New Issue Brief: An Economically Rational Energy Policy for the United States
New York, NY – European energy shortages and price increases have compromised the continent’s manufacturing and agricultural sectors, exposing the consequences of an energy approach built around curtailing hydrocarbons. Might America be in for the same fate? In a new Manhattan Institute issue brief, adjunct fellow Jonathan Lesser offers an alternative path and highlights the urgency of taking it.
Lesser demonstrates that the predominant framework for American energy policy—as well as its core policies—falls drastically short of even its own purported goal: net-zero greenhouse gas emissions achieved through a supposed transition away from fossil fuels. Further, the mandates, subsidies, and restrictions stemming from alarmism about climate change have had negative economic consequences, including increased goods prices and the transfer of costs onto low-income Americans. Lesser’s issue brief is a tightly evidenced argument for adopting a new energy policy framework—aimed at plentiful, reliable, affordable energy with minimal environmental impact—and policies capable of fulfilling that goal. These include:
- Eliminating the Renewable Fuel Standard: By subsidizing ethanol and biodiesel, the RFS has increased air and water pollution, and decreased the percentage of corn used for food, thereby increasing food prices.
- Increase domestic fossil fuel production: Without economically viable substitutes for fossil fuels, restricting their domestic production means increasing dependency on imports. This results in no environmental benefit, and significant energy security risks. Further, promoting domestic natural gas production would reduce greenhouse gas emissions.
- End electric vehicle mandates and subsidies: So long as fossil fuels generate the electricity required to charge them, EV’s hold limited promise for decreased greenhouse gas emissions. More consumers are opting for electric vehicles, and they should remain free to do so without the expensive inducements of public subsidies or mandates.
- Bet on nuclear energy: Streamlining regulations, investing in research and development, and embracing recycling for spent nuclear fuel would all promote nuclear energy, which holds great potential for reliable, plentiful, affordable, and clean energy.
Read the full issue brief here.
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