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Solar power subsidization

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  • Brady, Michael E.

Abstract

We provide a theoretical basis in microeconomic theory upon which to compare and contrast the role that subsidization has played in the past, vs the role it should play now and in the future, when a choice between fossil-fuel energy sources (oil, coal, gas) and solar energy is considered. Our model involves applications of nonlinear programming and control theory. The basic concept used is the production possibilities frontier (Transformation Curve). The major conclusion is that an energy policy for the 1980s requires a substantial reversal of the historical pattern of subsidy policy as it has evolved over the last 50 yr. The current U.S. plan to allow termination of producer and consumer solar power subsidies is questionable because of environmental impacts of fossil-fuel utilization.

Suggested Citation

  • Brady, Michael E., 1987. "Solar power subsidization," Energy, Elsevier, vol. 12(1), pages 67-73.
    • Handle: RePEc:eee:energy:v:12:y:1987:i:1:p:67-73
    DOI: 10.1016/0360-5442(87)90021-1
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