The editorial and your conclusions are wrong in several ways:

Calculations:

First, the calculation of the subsidy is not really that accurate, overlooks lots of externalities, and is (surprise!) just something plausible cooked up by the editorial page of the Wall St. Journal — an example of “lies, damned lies, and statistics.”

The World Resource Institute estimated (pre-Gulf War I) that the U.S. petroleum industry receives $300 billion in annual subsidies. This total far exceeds anything alternative fuels get, no matter how much it is per kilowatt for them.

FYI, The subsidy includes things like tax write-offs (the “depletion allowance”) and military protection for overseas oilfields and pipelines (estimated then at $50 billion, but clearly *much* more now). It does not include the cost of pollution, or climate change.

When you do the math, that WRI subsidy figure works out to roughly $2 per gallon — or about eight times the WSJ’s estimate. (Here’s one source for domestic consumption: http://genomicsgtl.energy.gov/biofuels/transportation.shtml)

The estimated subsidy for nuclear ($1.59/KWH v. $23.37 for wind) is similarly understated. Where’s the calculation of the effective insurance coverage provided by the Price-Anderson act that makes the taxpayers the insurers of last resort for nuclear plants? Or the cost of waste storage for 20,000 years? Sorry, this vastly understates the subsidy, never mind the fact that the U.S. did not charge the industry for the real Manhattan Project which was the basic R&D that created the industry.

Subsidies:

If we look past the bogus calculations promoted by the editorial pages of the WSJ, and the externalities they ignore, there still are real subsidies going to alternative energy here. Not very much in the context of a $3 trillion federal budget, but still not nothing.

And even if we grant the oil producers are getting orders of magnitude more in real dollars, per unit of energy produced, the alternative guys are clearly getting a substantial premium. How can one justify that?

The question is: Do you believe the government has a role to play in the research and development phase of alternative energy exploration?

And, for example, do you think NASA’s commission to Fairchild Semiconductor to produce silicon chips paid off in the end, even though Fairchild’s early research was clearly subsidized?

Or do you think the CDC’s grants for vaccine research and development are justifiable, or at least understandable?

I’m not a big fan of just throwing money at a problem (see the alternative energy research policy of the Carter administration) but I’d say most Americans believe government-sponsored research and development is OK.

I’ll go out on a limb here and say R&D in alternative fuels / energy sources is one of the areas of public concern where such spending is actually warranted.

On the other hand, subsidizing an industry making record profits with technology that, while sophisticated, is established, is *not* something to do.

Just my 2¢

Nuclear subsidies must be considered carefully. By law, only DOE can take possession of nuclear waste. There is currently (and has been for many years) a Federal tax on nuclear electric consumption to fund waste disposal. There are much lower subsidies in the form of government research etc. Some of these are in support or piggybacked on cleanup of the nuclear weapons program.

In all cases only the solar/wind crew get real subsidies that you could shake a fist at.