The phenomenon you aptly describe, Absalom, is a real concern among industry analysts. They call it the "Cubanization" of the market. They're afraid that people will hang onto their old cars instead of springing for new ones.
Define 'subsidy'. On-the-road gasoline has road taxes (vs. farm gasoline). The natural gas for your residential furnace and water heater does not have road taxes. So if you are not paying road taxes on the CNG fuel for your vehicle, is that not effectively a subsidy ?
I agree, dubues, driving a Tesla Roadster is an incredible experience. I need to add, however, that I didn't pay a penny to take the Roadster for a spin. And I can't afford to plunk down $109,000 to buy one.
Compressed Natural Gas has a much lower energy density than gasoline. And it requires (relatively) high pressure; e.g. propane is a liquid at 70 F and about 200 psi. So refilling a CNG tank requires a trained operator and specialized equipment vs. refilling a gasoline tank. Propane was also used (briefly) as a motor vehicle fuel. The relative scarceness of propane stations vs. gasoline stations, and having road taxes added, eventually killed the propane option. The CNG fill station would probably be at the fleet yard only.
Any kind of Government subsidy effectively distorts the markets. This is especially true of late in the Wind Power business. It is all but impossible to get a accurate picture of the cost of producing electric energy for the grid from wind power.
Ethanol subsidies have a similar effect just like milk price supports and any kind of government intervention. Free market Capitalism works really well when it is Free, a real Market of competing products, and the profit motive drives the business.
Frequently the environmental impact is cited as a reason to perturb the Free Market. this is incorrect. Teh true cost of the effects on the environment must be included in the product cost.
Imagine an electric car with the performance of a muscle car, the best energy efficiency and the best environmental impact. There is almost zero chance a product like that can emerge from our current system of subsidies and big corporations trying to maintain their status quo and huge investments in infrastructure.
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