[5]By Andrew Hillard
Cascade policy Institute [6]
If all goes as planned, July will be the start of a sunny future. Next month, Oregon Public Utilities will offer feed-in tariffs, or subsidies, for solar power. Under House Bill 3039 [7], homeowners will be eligible to receive 55 to 65 cents [8] for solar energy, compared to the usual cost of 10 cents per kilowatt-hour. The pilot project intends to boost jobs and clean technology by subsidizing 2,500 homes over 15 years.
However, legislative forecasts, like weather predictions, are often wrong; and in this instance, the sunshine will be short lived. The feed-in tariff has been tested in Spain and Germany. The result was, well, economic thunderstorms. Spain is now cutting 30% of solar incentives to prevent a Greek-style meltdown. Every subsidized “green” job cost Spain 2.2 jobs [9] elsewhere in the economy. Germany’s experience is no different. After 19 years of subsidies, solar only accounts for 0.5 percent of Germany’s [10] total electricity.
In Oregon, feed-in tariffs will be funded by electricity ratepayers, increasing power costs and destroying productive jobs. With 11% unemployment, this is not attractive.
Solar feed-in tariffs are neither new nor progressive. They’ve been tested and shown to have unintended, negative consequences. Even if record rains stop in July, this solar plan does not look bright.
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Andrew Hillard is a research associate at Cascade Policy Institute, Oregon’s free market public policy research organization.