Central Planning at Energy

November 5, 2009

The U.S. Department of Energy recently awarded $2.4 billion in stimulus money to develop and manufacture electric vehicles. The ostensible purpose of the government’s effort is to set the nation on a path toward more environmentally friendly transportation. But as the USA Today notes, electric cars might not provide the environmental benefits that proponents cite: 

A report released in October by the National Research Council — a non-profit government-charted agency — questioned whether electric and plug-in vehicles’ impacts are better or worse than conventional gasoline vehicles, mainly because about half of the energy supplied to the electricity grid comes from coal plants, “which contribute to air pollution” said Dan Greenbaum, a member of the committee that wrote the report and CEO of the Health Effects Institute in Boston. 

Most of the money is being split up between about three dozen vehicle and component manufacturers. Not surprisingly, the big automakers aren’t passing up a free lunch. Nissan, Ford, Chrysler, and Government General Motors are getting a combined $500 million. Another $40 million will be spent on “electrical car education” programs, which has waste written all over it.
Are electrical cars the wave of the future? Policymakers in Washington are betting other people’s money that they could be. Then again, the Dept. of Energy is also dishing out almost a billion dollars in stimulus funds for the “next generation” of biofuels. Electricity, biofuels, or kryptonite, nobody really knows what will be the ideal energy for our future transportation needs. But instead of leaving the decision up to the marketplace, which has a pretty good record when it comes to providing for the wants and needs of billions of people, policymakers appear hell-bent on throwing billions of taxpayer dollars against the wall and hoping something sticks. 



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