Editor: Reuters’ warning that ending wind and solar subsidies will raise electricity prices is the latest version of a familiar argument. Lisa Linowes (WindAction) challenged this argument when it was used to defend the Production Tax Credit in 2012 (Wind Energy Without the PTC) and in 2014 (AWEA Spins Price Distortions to Save PTC). More than a decade later, Reuters is again defending the undefendable.
“Wind and solar developers naturally want the public to equate nameplate megawatts with reliable supply, subsidized bids with total costs, and rapid deployment with technical necessity. They are selling projects. Reuters should be doing something different. The press should test industry claims, not launder them into economic common sense.”
Once again, a major media outlet is laundering the renewable-energy industry’s sales pitch through the authority of its news brand. In “Killing wind and solar subsidies will make US electricity more expensive,” Gavin Maguire, global energy transition columnist at Reuters, argues that phasing out federal wind and solar tax credits will raise prices, weaken reliability, and leave the United States unable to meet rising demand. The premise is simple: America needs more electricity; wind and solar make up much of the capacity now being added; therefore, slowing their development must make power scarcer and more expensive.
That conclusion is assumed, not demonstrated. The column treats nameplate capacity as dependable supply, heavily subsidized prices as evidence of low cost, federal renewable-energy tax credits as comparable to modest provisions for other resources, and batteries as though they generate electricity. These are not minor errors. They are the argument.
Nameplate Capacity vs. Dependable Power
A megawatt of solar is not equivalent to a megawatt that can be dispatched on demand. Solar declines late in the day and disappears at night. Wind follows weather, not system needs. A wind project may produce substantial annual energy while delivering little during a heat wave, cold snap, evening peak, or regional emergency. That does not make wind and solar useless. It means their nameplate capacity cannot be treated as dependable capacity.
Yet Reuters slides among capacity, generation, supply, and power as though they were interchangeable. It cites large numbers of proposed renewable megawatts and assumes they will strengthen reliability. But the relevant question is not how many turbines or panels developers install. It is how much dependable electricity the system can deliver during its most constrained hours. Reuters’s Maguire never asks that question.
Subsidized Prices Conceal True Cost
The Reuters column also presents wind and solar as inexpensive because they can bid into wholesale markets at very low prices. But a low bid is not the total cost of electric service.
Wind and solar receive substantial subsidies at both the federal and state levels. The federal Investment Tax Credit (extended 14 times since 1978) becomes available when a qualifying project is placed in service, while the federal Production Tax Credit (extended 12 times since 1992) is earned after the project begins generating electricity. In both cases, taxpayers shoulder a significant share of project costs, helping projects pencil out and allowing developers to sell power at prices that omit much of the cost taxpayers have already absorbed. What is advertised as cheap electricity is, in reality, heavily subsidized electricity.
The claim that “every energy industry is subsidized” is equally misleading. Wind’s PTC is an uncapped production subsidy: qualifying projects receive a federal credit for every eligible kilowatt-hour produced during their ten-year eligibility periods. Every new qualifying project creates another ten-year stream of credits.
According to the Energy Information Administration, tax subsidies to renewables between FY 2016–22 totaled $83.8 billion versus $9.3 billion for oil and gas and $15.3 billion for coal. In 2022, renewables received almost five times more tax reduction than that of oil, gas, and coal ($15.6 billion vs. $3.2 billion).
Even after Congress last year accelerated the termination of these subsidies for new wind and solar projects, Treasury estimates that the ITC and PTC in FY 2026–35 will reduce federal revenues by $156.4 billion, while the newer clean-electricity production and investment credits add another $73.1 billion—a combined total of approximately $229.5 billion. Although the newer credits are nominally technology-neutral, wind and solar dominate the development pipeline and are positioned to receive most of the benefits. Without this, the wind and solar industries as they are known today would not exist.
Federal subsidies are only one layer. State policies impose additional costs through renewable mandates, renewable-energy certificates, above-market contracts, net-metering programs, transmission expansion, and other mechanisms. In Massachusetts alone, these state-mandated climate and energy programs cost ratepayers more than $4 billion annually. Many of these costs are collected through delivery charges, public-policy riders, and other portions of electric bills rather than through the energy-supply line, making them difficult for customers to identify.
Moving costs into the federal budget and less visible portions of electric bills does not eliminate them. It disperses and obscures them. A low contract or wholesale price is therefore not proof that wind or solar is inexpensive. It reflects only the portion of the cost left in the advertised price after taxpayers and ratepayers have absorbed the rest elsewhere.
“Everyone receives subsidies” is qualitatively true but quantitatively not. The argument also neglects that fossil-fired generation has been punitively regulated for several decades, making their net subsidy arguably negative. In any case, the disproportionate welfare for wind and solar is an argument for eliminating all explicit subsidies for all energies and their technologies.
A Contrived Choice
The article also groups batteries with wind and solar as resources capable of filling the electricity gap. But batteries do not generate electricity. They store power produced elsewhere, have finite duration, incur losses, and must be recharged. A 500-megawatt battery lasting four hours is not equivalent to a 500-megawatt generator capable of operating for days.
Reuters’ Maguire then asks, “If not renewables, then what?” and quickly disposes of every alternative: gas is constrained by turbine shortages, nuclear takes too long to build, hydropower has limited room to expand, and geothermal remains small. Having defined the alternatives out of contention, the column presents wind, solar, and batteries as the only practical answer–a contrived choice.
Is There Ever a Right Time?
Reuters insists that now is the wrong time to end wind and solar subsidies. But the rationale for those subsidies changes with the circumstances. During more than a decade of stagnant electricity demand, renewable advocates insisted subsidies were necessary to force a transition away from fossil fuels. Now that demand is growing, the same subsidies are portrayed as essential to prevent shortages.
Under this logic, there is never an appropriate time to end them: stagnant demand requires subsidies for decarbonization, while rising demand requires subsidies for resource adequacy. That is not a timing-sensitive economic analysis. It is an unfalsifiable defense of permanent government support.
Policymakers can retain existing nuclear, coal, and gas plants that would otherwise retire, uprate facilities, reform markets to value dependable capacity, require large new loads to secure firm supply, improve demand response, and procure resources based on performance during critical hours rather than nominal capacity.
The claim that every cancelled renewable project creates a permanent shortage is just as weak. Existing thermal plants may remain open, other generators may be built, and different technologies may become economical. The Reuters column assumes no substitution and then declares the shortage inevitable. That is advocacy, not forecasting.
Reuters identifies the article as commentary. That does not excuse the absence of serious analysis by columnist Gavin Maguire. The piece offers no regional capacity analysis, no examination of critical-hour performance, no alternative resource portfolio, and no accounting for total subsidies, transmission, or integration costs. Instead, it reproduces the renewable industry’s script and presents continued government intervention as an economic necessity.
Wind and solar developers naturally want the public to equate nameplate megawatts with reliable supply, subsidized bids with total costs, and rapid deployment with technical necessity. They are selling projects. Reuters should be doing something different. The press should test industry claims, not launder them into economic common sense.
The United States does face rising electricity demand. But the objective should not be to maximize subsidized turbines, panels, batteries, or nominal megawatts. It should be to secure a portfolio capable of delivering power during critical hours, in the locations where it is needed, at the lowest total cost to consumers and taxpayers.
Reuters mistakes the renewable industry’s political success for technical necessity. That serves developers well. It does not serve readers trying to understand the grid.
Lisa Linowes is executive director and spokesperson for WindAction, a trusted resource regarding the costs of large-scale renewables, where this post recently appeared. Her previous posts at MasterResource can be found here.