Tom Joseph, Public News Service-PA
PHILADELPHIA - Pennsylvania is offering up substantial subsidies for natural gas production, and Gov. Corbett is leading the charge. Corbett sees natural gas, including the controversial practice of fracking, as a way the state can become an industrial powerhouse again. State subsidies to energy developers could top $1 billion in the next decade.
However, that money may be better invested elsewhere, according to Christina Simeone, director, PennFuture Energy Center.
"I think when you're talking about subsidizing mature, profitable industries and companies, it really, from the taxpayer's perspective, might not make sense," Simeone said. "If you're trying to support newer technologies, cleaner technologies that don't have a foothold in the market, I think that's where subsidies may be more appropriate."
There may not be a dollar-to-dollar correlation between subsidies given to natural gas and money not invested in renewable energy, but Simeone pointed out that the end result still changes the playing field.
"Whether subsidies are in the form of preferential tax treatment, grants or relaxed regulation, those all add to or subtract from the bottom line, making that resource more or less competitive," she explained.
Taxpayers may not realize that their money is being spent on both production and pollution control in getting natural gas to market, Simeone added.
"It's somewhat ironic that we're subsidizing the use of fossil fuels on one end, and then the taxpayer's also subsidizing to clean up," she said.
A study her group conducted just two years ago revealed subsidies for all fossil fuels in Pennsylvania totalled almost $3 billion dollars, Simeone said. Subsidies can sometimes result in lower costs to consumers, she noted, but if they are doled out as tax exemptions, they mean more money out of taxpayers' pockets.
The PennFuture report on fossil fuel subsidies is online at www.pennfuture.org.