Elon Musk: Politicians taking 'easy path' with fossil fuel subsidies

Tesla's chief executive Elon Musk has accused politicians of bowing to the "unrelenting and enormous" lobbying power of the fossil fuel industry, warning that a global "revolt" may be needed to accelerate the transition to more sustainable energy and transport systems.

Musk believes educating the public on the low-carbon agenda is essential in reeling back the fossil fuel industry’s ability to influence political decisions

Musk believes educating the public on the low-carbon agenda is essential in reeling back the fossil fuel industry’s ability to influence political decisions

Speaking at the World Energy Innovation Forum at the Tesla Factory in California on Wednesday (4 May), Musk claimed that traditional vehicles and energy sources will continue to hold a competitive edge against greener alternatives due to the vast amounts of subsidies they receive.

The solution to this energy dilemma, Musk says, is to introduce a price on carbon by defining a tax rate on greenhouse gas emissions or the carbon content of fossil fuels.

“The fundamental issue with fossil fuels is that every use comes with a subsidy," Musk said. "Every gasoline car on the road has a subsidy, and the right way to address that is with a carbon tax.”

"Politicians take the easy path of providing subsidies to electric vehicles, which aren’t equal to the applied subsidies of gasoline vehicles. It weakens the economic forcing function to transition to sustainable transport and energy."

Whilst reiterating these calls for a robust carbon tax, Musk acknowledged that introducing the concept would be “hugely and politically difficult - especially when you have enormous lobbying power on behalf of the fossil fuel industry". The business magnate therefore believes that educating the public on climate issues will be essential in reeling back the fossil fuel industry’s influence over big political decisions – which has already led to European climate policies being dropped over fears of a mass exodus.

“It is quite worrying, the future of the world," he added. "We need to appeal to the people and educate them to sort of revolt against this and to fight the propaganda of the fossil fuel industry which is unrelenting and enormous.”

Autonomous growth

Despite Musk's concerns, public demand for electric vehicles (EVs) is gathering pace and beginning to disrupt the automotive industry's biggest players. Last month, for example, pre-orders for Tesla's lower-priced Model 3 reached more than 276,000 within the first 24 hours of the car's unveiling.

Musk used his time at yesterday's forum to discuss how Tesla have had an “outside effect” on the industry, which has seen EVs grow from a “stupid idea” to the hallmark of company portfolios. With EVs set to represent 35% of all car sales by 2040, Musk predicts that half of all new car productions will be fully autonomous within the next decade.

“It’s going to be common for cars to become autonomous a lot faster than people think,” Musk said. “I think that seven or eight years from now, half of all cars produced will be fully autonomous, and it would be viewed as odd if it wasn’t in a car.”

Leading EV producer Nissan has already unveiled autonomous concepts, while Swedish car manufacturer Volvo last week revealed it will be trialling its own autonomous driving system in the UK next year.

Popular Powerwalls

Musk’s speech came on the same day that Tesla revealed that its pioneering Powerwall domestic energy storage system had hit 2,500 sales for the first quarter of 2016.

A letter to the company's shareholders states: “Tesla Energy posted strong growth in the quarter as well. During Q1, we delivered over 25MWh of energy storage to customers in four continents. We delivered over 2,500 Powerwalls and nearly 100 Powerpacks in the quarter throughout North America, Asia, Europe and Africa.”

The Powerwall sales – which Musk expects to surpass $500m in 2016 and 2017 – finally reached the UK this year, after SolarPlant engineers installed the first British Tesla Powerwall system at a home in Wales.

Matt Mace


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