On Fri, Nov 16, 2001 at 10:31:22AM +0100, Hentrich, Steffen wrote: > I think that this could only be if subsidies payed up to the exquilibrium > price of all exhaustable ressources. But this is not the case. Only a small > part of renewable energies gets subsidies and this not in all countries. > This implicates only a slow progress of back-stop-technologies and a > reduction of exquilibrium prices for exhaustible ressources. The theory of > exhaustible ressources predicts a lowering of marginal user costs and a > extraction path that cause a complete exploitation if marginal costs of > renewable will reached.
I don't completely understand this paragraph since several sentences don't seem to make sense. (What is "exquilibrium"? Is that a typo of equilibrium? What does "marginal costs of renewable will be reached" mean? Reached by what?) >From what I can figure out, a subsidy on renewable resources has two effects. One, it reduces the total amount of exhaustable resources extracted over all time. Two, it shifts some of the remaining extraction closer in time to the present. So it's not clear that the subsidy is beneficial overall. Is that what you mean?