Regulation = Green Subsidies - Really?

The nationalization of banks, investment firms and the automotive companies in the US and elsewhere might lead one to think that the large scale energy industry might be next. Apparently, this is what David Victor thinks in his Newsweek article. Well, I've simplified his argument but essentially what he says, is the market based approaches that have been tried to encourage green energy are not working and only regulation and government subsidies will be able to do it.

Whereas the old view of green tech was based on many small, decentralized sources of power and a green economy that harnessed the power of the marketplace, the new version will rely more heavily on regulation and subsidies.

Really? What business leader (if they are not bankrupt) wants to accept government money to influence how they do business. Clear, long-term and an effective regulatory structure can serve business, society and the environment more than subsidies for the long-term deployment of generation and transmission technology. I won't argue the point about subsidies needed to prime the technological pump to get things going, like R&D, but the large scale deployment of any green technology will have to be self sustaining. Lest we forget that the world economy is structured around oil: modes of transport, troop deployment, urban planning, there are more elements that go into underpinning the success of an energy source than government money.

The transition towards a post-carbon world depends on the use of large scale electrical infrastructure. Nuclear power, solar farms in the desert and large transmission systems to move the electricity from high production areas to high demand areas are needed. Distributed generation sources like rooftop solar panels and local gas turbines will contribute, but will not be the only answer, Victor gets it right in the last part of his article by pointing this out. But not only does the regulatory bar have to be raised, but society and the wider economy must be transformed to meet and compliment the new energy infrastructure. Throwing taxpayer money continuously at 'green' projects does not build a sustainable future, economically viable green projects do.