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Electric car subsidies a bad deal for taxpayers

Envisioning cars that can go “coast to coast without using a drop of oil,” President Barack Obama last week urged Congress to authorize an additional $2 billion over the next decade to expand research into weaning automobiles off gasoline.

“The only way to break this cycle of spiking gas prices — the only way to break that cycle for good — is to shift our cars entirely, our cars and trucks, off oil,” the president said.

But the record of politicians attempting to fight the twin realities of physics and economics to force-feed such a change is littered with the bankruptcies of heavily subsidized enterprises. Fisker Automotive halted work on a Delaware auto factory to make plug-in sedans a year ago, after the U.S. Energy Department blocked access to its federal loan, citing unmet milestones.

Chinese automakers last week pulled back from talks to buy Fisker, the dispute hinging on that federal loan. A123 Systems Inc., a Massachusetts-based manufacturer of batteries for electric cars that received a $249 million grant from the Department of Energy, filed for bankruptcy in October. Also apparently gone are Bright Automotive, Aptera, Think Automotive (a Norwegian firm that hoped to build electric cars in Indiana) and battery maker Ener1.

In fact, energy prices are high right now in large part because this administration has worked to get them there. Mr. Obama told the San Francisco Chronicle in 2008: “Under my plan of a cap and trade system, electricity rates would necessarily skyrocket.”

Newly discovered reserves and shale fracture technologies mean there are lots of ways to increase the supply of gasoline and keep prices down. For starters, the administration could approve more drilling leases offshore and on federal lands, more refineries, more pipelines. But Mr. Obama declines to do any of this because it doesn’t help his goal of making fossil energy more costly.

It also turns out electric cars don’t really do much to help the environment. They run on electricity, which has to be generated somewhere. The source of most of that electricity will be coal and natural gas — carbon-based fossil fuels.

Writing in the March 11 Wall Street Journal, Bjorn Lomborg, author of “The Skeptical Environmentalist,” writes: “Electric cars are promoted as the chic harbinger of an environmentally benign future. Ads assure us of ‘zero emissions,’ and President Obama has promised a million on the road by 2015. With sales for 2012 coming in at about 50,000, that million-car figure is a pipe dream.”

Read John M. Broder’s account of the failure of his Tesla electric car — equipped with the highest-capacity battery available — to manage a modest trip from Newark, Del., to Milford, Conn., in the Feb. 10 New York Times Automobiles section. Or consider the Nissan Leaf. It has only a 73-mile range per charge. Drivers attempting long road trips, as in one BBC test drive, have reported that recharging takes so long the average speed is close to 6 miles per hour — a bit faster than your average jogger.

But for those who do own an electric car, at least there’s the consolation that it’s truly green, right? “Not really,” Mr. Lomborg explains. “Sure, electric cars don’t emit carbon-dioxide on the road. But the energy used for their manufacture and continual battery charges certainly does — far more than most people realize.”

Yet the federal government subsidizes electric-car buyers at $7,500 apiece, while more than $5.5 billion in federal tax-funded grants and loans have already gone directly to battery and electric-car manufacturers such as Fisker Automotive and Tesla Motors.

Electric cars should have a place in the market — provided they’re free of the subsidies that have been such a bad deal for taxpayers.

This editorial appeared March 25 in the Las Vegas Review-Journal.


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