Climate Policy

[kandrathe]

It seems rather bizarre that I'm advocating the economists' solution, to set up an incentive structure that reflects externalities, and then let the market do its work, whereas you're advocating the statist solution of having a gigantic government program to make direct decisions about energy production for the whole economy.

Maybe it's Freaky Friday?

:lol:

I would advocate a State approach that attempts to preserve the investment of the owner. For example, a power company really doesn't care what fuel it burns or how the power is generated. They care about the input costs, and maintenance costs, and the capital needed to convert from one source to another. Home owners (like me) would freely migrate (from Electric, NG or Fuel Oil) to geothermal, if we could borrow the capital needed with a low interest rate and if the expertise to help perform the conversion were freely available. For vehicles, I would start with heavy investments in research and development of applications oriented research using already proven technologies (e.g. steam, or Stirling engines).

If the proposition is true that we are fatally damaging the climate, then messing around with incentive based solutions that may be subverted for profiteers seems time consuming, and invests energy and capital in too wasteful a manner. The least painful way will be to bite the bullet, and convert off of fossil fuels in the most expeditious manner possible. I see three good reasons to do it; 1) limited supplies (peak oil) with increasing price and market uncertainty, 2) pollution, 3) climate change.