Two Stumbling Blocks on the Road to Regeneration: Externalities and Subsidies

By understanding the key reasons why the global economy behaves as it does today, we will be in a better position to discern the core patterns underlying economic behaviour and, if we choose, to change them. Two key drivers of today’s global economy are externalities and subsidies.

A Blessing or a Curse?

Researchers estimate that the global fossil fuel industry is subsidised to a tune of $5.3 trillion (6.5% of global GDP) every year yet this raises few eyebrows. We believe that subsidies for energy access related projects are not an outlandish proposition and in fact, if implemented correctly could be the catalyst that tips the nascent rural off-grid sector into rapid scalability.

The Crocodiles of Reality

I’ve suggested in several previous posts that the peak oil debate may be approaching a turning point—one of those shifts in the collective conversation in which topics that have been shut out for years or decades finally succeed in crashing the party, and other topics that have gotten more than their quota of attention during that time get put out to pasture or sent to the glue factory.