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The Subsidy Gold Rush: How Green Energy Firms Profit from Your Pocket

The Subsidy Gold Rush: How Green Energy Firms Profit from Your Pocket

Apr 22, 2024

The Subsidy Gold Rush: How Green Energy Firms Profit from Your Pocket

An article by the Wall Street Journal casts a spotlight on the burgeoning green energy sector, highlighting how companies such as First Solar are reaping substantial benefits from government subsidies, largely funded by taxpayers.

The Wall Street Journal

First Solar, an Arizona-based solar panel company with a market valuation of $19 billion, is one such entity that has struck gold in the subsidy mine, with nearly 90% of its profits originating from taxpayer subsidies. According to industry analysts, the company is on track to receive over $10 billion in government handouts, an amount that quadruples its annual sales. This discrepancy between the revenue generated by the business and the subsidies it receives raises questions about the sustainability and dependency of green energy firms on public funds.

The company's aggressive lobbying efforts, which have nearly tripled in recent years, suggest that the political influence may play a significant role in securing these lucrative subsidies. First Solar's success story is part of a larger narrative in which hundreds of companies are feasting on the allocations from the Inflation Reduction Act – a legislative piece that, despite its name, focuses on funding green energy projects rather than directly addressing inflation.

This Act, initially known as the Build Back Better green scheme and endorsed by the World Economic Forum, is set to distribute over a trillion dollars to various green companies, ranging from wind and solar power to battery and lithium industries. Notably, a significant portion of this funding will end up in the coffers of foreign companies, raising concerns about the global distribution of U.S. taxpayer dollars.

Historically, the solar industry is no stranger to cronyism and government handouts. A case in point is Solyndra, a company that received $535 million in federal taxpayer loan guarantees during the Obama administration, only to file for bankruptcy shortly after due to a non-viable product and fierce market competition. The investigation that followed revealed not only financial mismanagement but also allegations of tax avoidance as a primary motive behind the bankruptcy.

As the green energy sector continues to expand, the specter of a "Solyndra industrial complex" looms, with the potential for more companies to follow in First Solar's footsteps, benefiting from taxpayer dollars at an unprecedented scale.


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