Renewable energy is good for the future, but the decision of cuts to renewable energy subsidy makes sense as well

The UK cuts to renewable energy subsidies is criticised by a top UN environmental scientist. Renewable energy is good for our future, this is agreed by all of us. However, it does not mean that the subsidy for renewable energy needs to continuously rise forever. Subsidy exists because there is a external benefit. An external benefit is a benefit that the market does not realise and take account into its price. The value of renewable energy is now better understood by the public and most people are more willing to use renewable energy if the prices are similar. Keeping the same level of subsidy might cause a negative externality. This means the external benefits of renewable energy have reduced. In addition, solar energy firms had been hot spots of many investors recent years.Technology of renewable energy develops at an incredibly fast rate, the cost has been reduced to a great extend. Cutting in renewable energy subsidy is sensible and good for the market and the government budget, as this encourages competition between the renewable energy industry and the traditional energy industry. Renewable energy is good for our future, but this does not mean that it needs unlimited support. This is how an economist and a scientist think differently.