DIYbanter - View Single Post - Fueling your car with natural gas from home

Smitty Two

In article
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wrote:

Exactly. Just because the government hands out subsidies, it doesn't
change something that is economically unviable into something that
is. Take a look at what's going on with solar electric here in
NJ. With all the subsidies between the feds and state, a $50K
residential 6KW system can cost the homeowner only $25K to put in.
The rest of that comes from the taxpayers and a surcharge placed on
everyones electric bill. And after that, the power companies here
are being forced to buy clean energy credits to meet their clean
energy reqts, so you can get a few thousand a year in income on top of
it. The only problem is, it only works with small numbers of people
doing it. Which in turn means it can't amount to any substantial real
impact on generating electricity to change anything. If more people
did it, there would not be enough money to subsidize it. That is the
paradox.

My take on this is that technology becomes substantially less expensive
(IOW more economically viable) with increases in volume. Economies of
scale, and continued refinement and improvement. So the gov't subsidies
are a way, hopefully, to kick-start the alternative energy R&D and help
to scale up production methods to the efficient level.

I think this is a good example of the principle: Not everyone is aware
that they have Apple to thank for low-cost LCD computer displays (and
now LCD TVs.) Apple committed to LCDs by discontinuing all CRT displays
a number of years ago. The first computer I bought for my son had a 17"
LCD display that cost $800. Apple created an instant demand for millions
of LCD displays, and single-handedly drove the cost down.

It takes a small but significant commitment to a technology to make it
economically viable. I think it's reasonable for the government to
subsidize that commitment.