Energy is the “lifeblood of our economic system,” as the Nobel Prize-winning economist Milton Friedman noted.
Affordable, reliable, and plentiful energy is the foundation of economic growth and prosperity. People and businesses pay directly to purchase electric power and fuel for transportation, and the price of energy is a significant factor in the cost of the vats majority of goods and services traded in our economy. When energy is expensive, people and businesses have fewer resources available for food, education, health care, environmental stewardship, hiring more workers and paying them better wages, and expanding business operations.
Affordable energy, economic growth, and environmental stewardship need not be at odds with one another. Affordable energy and economic growth create the economic resources necessary for effective environmental stewardship. The energy sources that are most abundant and affordable are surprisingly environmentally friendly, especially given recent technological advances. In many ways, the best way to be pro-environment is to be pro-energy.
Energy issues are rising to the top of the agenda in many states, compelling elected officials to take positions on topics as wide-ranging as subsidies to biofuels producers and restrictions on mercury emissions from coal-burning power plants. Energy issues often are complex and frequently changing, with changes in technology, prices, and policies adopted in other states and other countries all affecting what policymakers do.
How do we balance energy and environmental concerns with the individual rights and freedoms we hold dear? Those who say we most not utilize our least-expensive fuel sources are putting small and hypothetical risks ahead of better-understood costs and benefits. We know that coal, natural gas, and nuclear power can be used to generate electricity safely and cleanly. If we fail to do so, we risk supply interruptions and rising costs, which in turn will reduce economic growth and job creation.
Unhindered and unsubsidized competition among energy technologies is the best means to discovering tomorrow’s new energy sources. Elected officials should not try to pick winners, even though doing so may score points with one group or another in the short term. In the long term, the individual choices of people and businesses, not governments, will lead to a more diversified fuel supply, reliable energy technology, and environmental protection that is effective as well as efficient. Market-driven energy policies will generate the wealth necessary to maintain a healthy environment and provide our homes and businesses with affordable and reliable electricity.
The Heartland Institute's experts on energy policy are available for legislative testimony, speaking engagements, and media interviews.