In early 2010, when I first read of the T. Boone Pickens' plan
to subsidize the conversion of 18-wheelers to run on natural gas I
thought it was a great idea. Clean-burning, abundant, cheap nat gas
would be a triple-crown winner for the environment, the economy,
and new industries, to say nothing of national energy security with
less dependence on the Middle East.
I thought Boone was one of the more honest types in the energy
patch for having the guts to take this stand for our country when
it could just as easily hurt some of his petroleum investments. But
obviously, lots of other big oil guys would be hurt worse. In fact,
one of his buddies and fellow fossil-fuel billionaire, Charles
Koch, publicly slammed Boone for his plan.
But the Wall Street Journal ran an editorial piece a couple of
weeks ago that challenged the man's plan as simply more
corporate welfare.
"Proponents put the cost at about $5 billion over five years,
but many energy experts believe it would be multiples higher.
Eight million trucks are on the road today, and if each got a
$15,000 average tax credit, the price tag grows to over $100
billion.
The history of energy subsidies is that they become an
industrial and political addiction that is difficult to stop, no
matter the results, and may even inhibit innovation and
profitability by providing a crutch."
My take is that we've subsidized just about every other industry
that needed it or not. And this one seems like it's worth a try in
some way, on some level. I'm not for wasting money and creating
dependent industries that don't really serve broader objectives.
The details need to get hammered out and compromises will have to
be made.
The Journal suggests letting free markets work their magic to
eventually find the best solution. I couldn't agree more because
while Congress fiddles and fights about it, American companies (and
Norwegian ones) will probably be busy selling the technology and
infrastructure to China and other markets. Why do you think
Cummins, the biggest maker of nat gas engines, already
does business in 190 countries?
So, should we subsidize nat gas engines, or not? And why or why
not?
Cooker
CLEAN EGY FUELS (
CLNE
): Free Stock Analysis Report
CUMMINS INC (
CMI
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FUEL SYSTEM SOL (
FSYS
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GOLAR LNG LTD (
GLNG
): Free Stock Analysis Report
WESTPORT INNOV (
WPRT
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