Appropriable Quasi-rents, Local Governments, and State and Federal Renewable Power Policy

Michael Giberson

State and federal policy provides substantial subsidies to renewable power producers, but just because the subsidies go to renewable power producers in the first instance doesn’t mean they receive the full net subsidy. Figuring out the exact distribution of the subsidy requires extensive additional analysis. For example, local governments are exercising their authority to capture some small bit of the action through inspection and permitting fees and local excise taxes.

Stories like this one, from Renewable Energy World, suggest that the renewable power business is feeling the sting just a bit.

I was reminded of John Neufeld’s economic history work on the role protection of quasi-rents played in the origins of state electric power regulation, discussed at KP here.