In recent years, Harrisburg politicians decided that Pennsylvania would play venture capitalist in the solar energy market. In an attempt to attract green jobs, the Commonwealth extended more than $180 million in loans and grants to develop solar panel production. Subsidies were so successful in creating an artificial market that solar energy credits completely collapsed in value leaving a surplus of solar panels. A Republican representative has decided to sponsor legislation to salvage the solar industry through more subsidies. This legislation defies the principles of limited government and free markets. Additionally, the legislation is projected to increase costs for both energy consumers and taxpayers.
Clearly the government caused the boom and bust of the solar market. The push by the Republican lawmaker for increased government intervention in this arena is ill-advised. The considered legislation is anticipated to cost Pennsylvania energy consumers more than $3 billion over the next decade and will prove costly to the taxpayer as well. Interestingly, ideological roles seemed to be reversed as the Democratic committee chair stands in opposition to the plan for increased solar subsidies. Despite Gov. Corbett’s objections, the Republican’s legislation has garnered enough co-sponsors in the House to pass. The legislation requires utility companies to triple their use of solar power by 2013. Over the course of the next decade, Pennsylvania’s Alternative Energy Portfolio Standards Act of 2004 requires that 18 percent of all energy sources from renewables.
The stringent mandates from the 2004 legislation and the current solar rescue package will be detrimental to the state’s already stagnate economy. The government sponsorship of solar and renewable energies diminishes the purchasing power of Pennsylvanians. Residential and commercial energy users will be coerced into paying more for their energy. The government is directly picking winners and losers in the economy as they buttress one sector at the expense of competing energy producers. Harrisburg’s mandates must be repealed as they are in opposition to free market competition which fosters innovation.
Providing more subsidies to fix an already distressed solar market is not the solution. There is another method to attract the green industry to Pennsylvania without imposing costly energy mandates on Keystone residents. By implementing policies to improve Pennsylvania’s business climate, policymakers can entice investment for not only green jobs, but all industries. Tax reform accompanied with a right-to-work law would be a catalyst to increase Pennsylvania’s economic competitiveness.
The government must stop playing venture capitalist with taxpayer money. Pennsylvanians should be given the opportunity to utilize the most affordable energy source. The Commonwealth is very fortunate to have an immense amount of coal and natural gas. These natural resources need to be part of the state’s energy portfolio for the future. Tremendous innovations have already occurred in recent years regarding renewables. Improving Pennsylvania’s business climate utilizing a free market is the best way to develop green energy technology and stimulate the Keystone economy.
Jonathan Humma blogs at Keystone Liberty: Limited government and free markets for a prosperous Pennsylvania.
Like PennDOT, the Pennsylvania Turnpike is yet another government agency that is experiencing a worsening financial situation. The Turnpike Commission has been attributing their financial woes to declining revenues and increasing costs. Despite increased tolls, Moody’s credit rating agency foresees an ongoing struggle for the turnpike. A Republican representative is now advocating for the allocation of Marcellus Shale natural gas taxes to ease the toll road’s funding burden of nearly half a billion dollars in state transportation funding. While this may offer a short-term increase in funds, the underlying problems associated with the turnpike commission remain. A superior policy alternative would be to lease the turnpike.
Despite tolls being raised by 20 percent in 2009, the Pennsylvania Turnpike has still lost$2.4 billion. In 2012, the commission has ordered another 10 percent increase in an attempt to balance the budget. The turnpike’s debt has escalated by more than 180 percent, or $5 billion, since 2007. The additional debt will be accompanied by more than $11 billion in interest payments over the course of the next several decades. This will place a significant burden on taxpayers. The turnpike commission is exacerbating Pennsylvania’s state of fiscal instability. The history of the Pennsylvania Turnpike Commission has been rifled with deficits, toll hikes, labor strikes, and corruption.
Unfortunately for Pennsylvanians, lawmakers continue to support the Turnpike Commission and all of its failures. A Republican representative is calling for natural gas taxes to be utilized to alleviate the turnpike’s funding of statewide transportation. This proposal is a common big government maneuver in which one program or revenue stream is utilized to fund another program. While the turnpike tolls are designed at funding the state roadway, its tolls on motorists are being directed to state transportation and mass transit. This is similar to immense alcohol markups by the PLCB that supplement the general fund instead of strictly financing law enforcement and regulation of the industry. Directing natural gas taxes towards state transportation initiatives is a similar ploy. These revenues should be earmarked solely for environmental regulation of the industry.
There is an alternative to the billions of debt and makeshift attempts by politicians geared toward raising new revenues on industries to fund troubled programs. Leasing the turnpike will flush the state with cash while improving the roadway for Pennsylvania motorists. If the Commonwealth would have proceeded with the lease agreement suggested by the Rendell administration, Pennsylvania would have received nearly $12 billion upfront and accrued a billion dollars in interest annually. In the leasing contracts, the state would have the autonomy to control toll hikes, receive payment for state police coverage and no longer be responsible for maintenance costs.
The Pennsylvania Turnpike continues to be a burden to taxpayers. The government owned roadway accrues billions of dollars in debt for taxpayers while continually raising tolls on motorists. Siphoning of funds from Marcellus Shale to turnpike commitments is only a short-term fix that maintains the status-quo. The Republican majority must take the lead and release the turnpike in order to turn the roadway form a costly liability to a profitable asset.
