Scrap Solar Subsidies

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 Harrisburg’s mandates must be repealed as they are in opposition to free market competition which fosters innovation.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.

Tapping into PA’s Coal Reserves

In an overwhelmingly bipartisan fashion, the Pennsylvania House passed HB 1813 by a vote of 193-1. This bill gives the coal industry the ability to more easily tap into an estimated 6 billion tons of anthracite coal. The legislation enables coal companies to use more of their own capital to meet bonding requirements for mining reclamation while re-opening abandoned mine sites.

Environmental organizations, such as the Eastern Pennsylvania Coalition for Abandoned Coal Mine Reclamation, support the legislation. The profit incentive from available coal in old mine sites will entice many companies to start operations in the five county region. As a prerequisite of operation, companies will be held responsible for restoring damaged ecosystems from past mining. Ultimately, this will take the $10,000 per acre reclamation bill burden off the taxpayer tab and accelerate the restoration process.

According to the GOP release, in the past, the coal industry was a major employer with more than 150,000 employees. Today, after decades of downsizing due to increased federal and state environmental regulations imposed on mining operations and power plants, the coal industry employs a mere 1,000 Pennsylvanians. This new legislation boasts tremendous potential for the creation of new jobs in the industry.

Along with increased jobs comes an increased supply of coal. According to economic theory, an increased supply on the power grid equates to lower energy prices for struggling consumers. Unleashing the potential of Pennsylvania’s natural resources will be an invaluable component to the country’s growing energy needs and goals of becoming more energy independent in the future.

Sponsor Representative Mike Tobash proclaims HB 1813 to be a true “win-win” situation. The legislation will save taxpayers money in mining reclamation costs, create hundreds- if not thousands- of jobs in Pennsylvania, deliver affordable energy to consumers, and promises to far exceed the current $200 million contribution mark to the Keystone economy. The legislature can unleash the potential of the state’s immense natural gas and coal reserves while maintaining the environment. HB 1813 is a dynamic example of aligning proper incentives for both ecological and economic development. Policymakers must allow the industries to flourish in order for Pennsylvania to become a national leader in energy production.

Democrats Condemn 2011 as “GOP Failure”

Before adjourning for Christmas recess, Democratic leaders issued a press release lambasting Gov. Corbett and the Republican legislature for their “extreme ideological crusade” and “no leadership on jobs.” The scathing critique included overtones of commonplace class warfare rhetoric accusing Republicans of attacking workers’ rights and the middle-class. Representative Dermody, D-Allegheny, went as far as saying that Republicans made Pennsylvania’s job climate worse coupled with failures in transportation and Marcellus Shale tax policy.

Despite Democratic claims, Republicans accomplished several achievements for Pennsylvania’s job climate. The Corbett budget reduced spending and did not raise taxes. The Corbett administration no longer had federal stimulus funds and made substantial cuts. An end to the state’s runaway government spending brought tax stability for job creators and Pennsylvanians. In order to successfully curb Pennsylvania’s onerous tax burden, Republicans passed legislation to reduce loopholes in school district property tax hikes without voter referendum. Republicans refrained from imposing large Marcellus Shale taxes which will keep the industry booming. According to Democratic philosophy, taking action on jobs equates to more government spending. In stark contrast, Republicans are trying to keep spending and taxes low so that the private sector can prosper.

Senator Hughes, D-Philadelphia, asserts that budget cuts are “reverse investments at a time when we should be investing more in our roads, bridges, mass transit, and our workers.” Governor Corbett’s transportation report in August agreed that the state of Pennsylvania’s infrastructure is deteriorating. Third party state rankings report that Pennsylvania’s roadways and bridges are amongst the worst in the nation despite being at the top of the leader board in roadway spending per mile. Additionally, fuel taxes, which fund the roadways, are amongst the highest in the nation. Instead of raising fuel taxes which increase the burden for Pennsylvanians at the pump, there must be reforms dedicated toward getting more value for the current funding. Senate Republicans passed SB 344 which established more public-private partnerships in transportation. More efficient infrastructure spending means more projects, more jobs, and better roadways.

Lastly, state Democrats protested against the Republican’s impact fee on Marcellus Shale natural gas drilling. Democratic leaders contend that the tax on drilling companies is not high enough for companies to “pay their fair share.” Democratic legislators criticize Pennsylvania for having the lowest tax on natural gas drillers in the nation. For many Democrats, the economic boom associated with the natural gas industry equates to more revenue for government spending. Republicans must proactively highlight the billions of dollars in capital investments, royalties given to local landowners, and taxes generated from the industry. The industry is successfully providing jobs and cheap energy to Pennsylvanians. Taxing the industry will ultimately reduce its investment and growth potential, and impose higher energy costs on already struggling consumers.

Democrats continue to lash out at GOP leadership in an effort to score political points and defer blame of the stagnant, faltering economy. Republicans must keep focused and press forward to reduce the growth of government, provide tax relief, and create a business friendly climate for job creation.