Horsepower or Kilowatt Hour?
Published January 16, 2025
Americans show limited interest in clean energy initiatives and electric vehicles despite significant government investment and political push. Fossil fuel consumption actually increasing between 2020-2022. American reluctance towards clean energy stems from practical concerns - higher costs, long charging times for EVs, and expensive replacement parts compared to traditional gas-powered vehicles. Successful energy transitions, historically, must been driven by market forces and consumer preferences rather than government mandates.
Terry Anderson is a senior fellow at the Hoover Institution and is one of the founders of “free market environmentalism,” the idea of using markets and property rights to solve environmental problems.
Check out more from Terry Anderson:
- Watch "Markets vs. Mandates" from Terry Anderson and Dominic Parker here.
- Read "From horsepower to electric vehicles, the market always beats mandates" by Terry Anderson here.
- Read "Environmental Incentives vs. Environmental Mandates: Lessons for Educational Policy" by Terry Anderson and Dominic Parker here.
The opinions expressed in this video are those of the authors and do not necessarily reflect the opinions of the Hoover Institution or Stanford University. © 2025 by the Board of Trustees of Leland Stanford Junior University.
>> Narrator: Despite significant financial investments from the federal government to create a clean energy economy, Americans have largely shown little interest. Between 2020 and 2022, the share of fossil fuels in US energy consumption increased while renewables declined. Why? The simple answer is economics. American consumers are reluctant to switch to clean energy when it may lead to higher energy bills or require significant lifestyle changes.
Electric vehicles are not as cost effective convenient as gas powered cars. Charging EVs at home can take more than 10 hours and charging stations can take 20 minutes to an hour. While replacement batteries have come down in price, they still cost thousands of dollars. Conventional automobiles, however, have cheaper replacement parts and take only minutes to fill with gasoline.
Successful energy transitions are driven by economic factors and consumer preferences, not government intervention. In the 1920s, farmers switched from horses tractors to make plowing more cost effective. Remote farms and ranches transitioned to electricity with convenient and affordable wind chargers. However, the Rural Electrification act of 1936, which subsidized power line construction, ended this market driven transition.
Political agendas and subsidies may stifle innovation and consumer friendly sustainable energy options in the future. Understanding consumer preferences and concerns can guide policies that foster innovation, spur competition, competition, create widespread adoption. And ultimately lead to environmentally friendly options affordable to all Americans.