"The energy market is not like most other markets. Indeed,
the economics of alternative energy are such that private
investors, left to their own devices, are bound to underinvest
in it, since the considerable social benefits - cleaner air, fewer
greenhouse emissions - accrue to EVERYONE, not just to
direct customers. That means that the economic rate of
return is significantly less than the social rate of return.
Despite the immense size of the energy market, as of 2005
spending on energy R&D accounted for just 2% of total
spending on R&D in the U.S. This creates an opportunity for
the government to add value by investing smartly, just as it
can add value by spending money on education or
infrastructure, other areas where the social returns are
greater than the economic ones " - James Surowiecki,
Columnist for the New Yorker Magazine's Financial Page
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