Originally published at The Daily Economy. 

US Energy Secretary Chris Wright recently summed up the new federal approach: “We are unabashedly pursuing a policy of more American energy production and infrastructure, not less.” That’s a welcome shift after four years of Washington micromanaging energy markets, imposing costly regulations, and forcing unreliable sources into the grid.
 
But as someone who lives near Austin, Texas, I’ve seen firsthand that avoiding federal overreach is only part of the solution. States must also resist the temptation to control energy markets — something Texas is starting to get wrong.

Texas and California are the two largest US states by population and economic output. Their energy policies have produced starkly different outcomes. 

See endnote for chart references.

• California has some of the highest residential electricity rates in the country, averaging 35 cents per kilowatt-hour, compared to 10 cents in Texas.
• Texas produced 547 terawatt-hours of electricity— more than a quarter of US generation — while California generated 217 terawatt-hours.
• California’s renewable share is 57 percent, compared to Texas’s 30 percent.

But being more “green” doesn’t necessarily mean better. California’s grid is fragile and prone to blackouts, overreliant on intermittent sources. Texans benefit from lower prices and higher output, but Texas now leads the nation in wind generation — a title earned through decades of subsidies, not pure market forces.

That chart tells the story: Texas still delivers more energy for less money, but the policy gap is closing — in the wrong direction. Texas is in danger of losing its competitive edge by repeating California’s mistakes.

Texas Risks Becoming California

The Texas blackout during 2021’s Winter Storm Uri was a wake-up call. As energy economist Rob Bradley, policy expert Bill Peacock, and others have reported, frozen wind turbines and iced-over solar panels were unable to meet demand. Natural gas plants underperformed due to poor weatherization, and the state’s overreliance on intermittent sources magnified the crisis. 

Texas’s electricity market is not as “free” as many believe. While Texans can choose their electricity providers in a competitive retail market under the Electric Reliability Council of Texas (ERCOT), the generation side is riddled with subsidies and political interference. 

For years, Texas’s Chapter 313 property tax abatement program was heavily favored by wind and solar projects, distorting investment decisions. But that program expired in December 2022. In 2023, the legislature passed another version of property tax abatements in Chapter 403, and voters approved a new constitutionally dedicated Texas Energy Fund, with $5 billion in low-interest, taxpayer-funded loans for new natural gas plants. This year, the legislature passed another $5 billion in subsidized loans and could soon subsidize nuclear power.

This is still political favoritism — only the fuel source changes, leaving a flawed policy intact.

Subsidies Distort Energy Markets

Subsidies heavily distort Texas’s power generation market. Federal production tax credits and Inflation Reduction Act subsidies for wind and solar drive massive overbuilding, even when those sources couldn’t meet demand during peak stress.

​Now, Texas is repeating its errors with dispatchable generation — bolstering natural gas with state-backed loans rather than allowing higher market prices to attract private investment. As AIER research has shown, markets allocate resources more efficiently when prices reflect actual costs and risks. When the government guarantees a return, investors chase subsidies rather than consumer demand.
​
Gabriella Hoffman, director of the Center for Energy and Conservation at the Independent Women’s Forum and a recent guest on my “Let People Prosper” show, makes this point clearly: conservation and market-based energy policy can coexist, but only if the government stops trying to pick winners. Europe’s energy crisis serves as a warning about what happens when political goals take precedence over reliability and affordability.

Energy Freedom Drives ProsperityEnergy is a foundational component of economic growth. It powers manufacturing, health care, technology, and every part of modern life. Energy policy must be grounded in cost-benefit analysis and market principles — not central planning and political favors.

Secretary Wright is correct to warn that Europe’s “net zero” strategy has made energy more expensive and less reliable. The US should not follow suit, and neither should Texas. Instead, lawmakers should remove barriers to pipelines, LNG terminals, and power plants, while eliminating taxes and fees on oil and natural gas production that fund unnecessary government growth.

Living near Austin, I see every day how energy costs shape business decisions and family budgets. People continue to move here from California for lower costs and greater opportunities. But if Texas continues to copy California’s interventionist approach, that advantage will erode.

Power for the Future

Texas’s energy sector still outproduces California’s, delivering lower prices and greater reliability.

But government meddling — whether for wind, solar, gas, or nuclear — threatens to undo many of these benefits. The path forward is clear:

• End all tax preferences and subsidies for every energy source.
• Let ERCOT’s price signals work without political interference.
• Approve infrastructure quickly, but without taxpayer guarantees.
• Let consumers and suppliers, not politicians or regulators, decide the energy mix.

If Texas allows people in the market to navigate freely, the state can remain the energy leader that California isn’t. This would also ensure families and businesses continue to move here for the freedom and prosperity they can’t find elsewhere. If not, Texas could find itself with California’s prices, reliability problems, and dependence on politics to keep the lights on.

Chart references:

• US Energy Information Administration (EIA). Net Generation by State (2023).
• EIA – State Electricity Profiles: Texas (2023).
• EIA – State Electricity Profiles: California (2023).
• EIA – Electric Power Monthly, Table 5.6.A: Average Retail Price of Electricity to Ultimate Customers by End-Use Sector, by State (May 2025).
• EIA – California State Energy Profile (includes Renewables Share).
• *EIA – Texas State Energy Profile (includes Renewables Share).

​Economist Julian Simon said, “Energy is the master resource, because energy enables us to convert one material into another. As natural scientists continue to learn more about the transformation of materials from one form to another with the aid of energy, energy will be even more important.”
Energy powers our homes, fuels our industries, and drives the innovations that secure our future. However, when Washington attempts to micromanage the energy sector through regulations, subsidies, and political agendas, it distorts the market and drives up costs.
But it doesn’t have to be this way. When markets are free to work, America thrives. We’ve seen that energy abundance, competition, and innovation emerge naturally when government steps back and entrepreneurs step forward. The path to a stronger economy and a more reliable grid isn’t more government planning—it’s less!
In This Week’s Economy episode, I discuss how we got here, what’s at stake, and the four steps we must take to unleash America’s full energy potential. From ending regulations and subsidies, to rejecting ESG mandates, to fueling innovation, the blueprint is clear: trust markets, not bureaucrats, to power America’s future. 
You can catch the full episode on YouTube, Apple Podcast, or Spotify.
Visit: VanceGinn.com
Subscribe: VanceGinn.Substack.com

​We hear it all the time: the planet is doomed unless we regulate energy into the ground. But what if the real path forward is the opposite—more energy, fewer mandates, and stronger markets?

In this week’s Let People Prosper Show, I’m joined by Gabriella Hoffman, Director of the Center for Energy and Conservation at the Independent Women’s Forum and one of the most insightful voices in energy policy today. Gabriella brings a refreshing take to the conversation—rooted in liberty, informed by experience, and focused on prosperity through abundance.
We discuss her journey, from the daughter of Lithuanian immigrants to a leading advocate for market-based energy and conservation. We delve into the energy crisis in Europe, explore how over-regulation backfires, and discuss why America must resist the urge to centralize energy decisions in Washington, D.C.

For more insights, visit vanceginn.com. You can also get even greater value by subscribing to my Substack newsletter at vanceginn.substack.com. Please share with your friends, family, and broader social media network. 

(0:00) – Introduction to Energy and Conservation Policy
(4:56) – Gabriella Hoffman’s Journey into Energy Policy
(10:02) – The Role of the Independent Women’s Forum
(14:45) – Personal Stories and Perspectives on Energy
(19:51) – The State of Energy Policy in Europe
(24:59) – The Impact of Deregulation on Energy Markets
(29:53) – The Future of Energy in America
(34:48) – The All-of-the-Above Energy Strategy
(39:54) – The Next Generation of Leaders in the Liberty Movement

Originally published to Substack. 

How resilient is the diesel market when the government keeps distorting prices?

My latest peer-reviewed, co-authored research, published in Oil, Gas & Energy Quarterly, delves deeply into this critical question. In this post, I break down what the data show, how the market adjusts (or doesn't), and what policymakers need to stop doing if they want to help working families and truckers, rather than hurting them.

​Back to Basics: Supply, Demand, and Diesel
​
Diesel isn’t just another fuel—it’s the backbone of freight, farming, construction, and everyday logistics in America. When diesel prices spike or remain artificially volatile, the costs ripple across the economy, crushing families and small businesses.

In my newly published paper, “Structural Breaks and Longrun Adjustment in the Diesel Fuel Market” (with co-authors Chris Douglas, Mark Tuttle, and Don Bumpass), we investigate how diesel fuel prices respond to long-term disruptions and whether markets eventually return to their previous trends.

Key Finding:
Yes, diesel markets adjust over time—but not always smoothly. We find evidence of multiple structural breaks, points at which the usual relationships between variables (such as crude oil prices, supply shocks, and regulations) shift permanently.
That means policy shocks, such as regulatory mandates, price interventions, or geopolitical disruptions, don’t just cause temporary price spikes. They can change the market's behavior altogether.

Why This Matters Now:
The government has an annoying habit of thinking markets are machines to be fine-tuned. But markets adapt—and sometimes they break. Diesel is a textbook example.

• Diesel prices remain elevated and volatile despite some declines in crude prices.
• Regulatory burdens—especially environmental mandates—have permanently raised costs on refiners.
• Tariffs on global energy trade, like those pursued under the Trump administration and expanded now, distort input prices and ripple through to diesel.
• And bad monetary policy—whether through ultra-low interest rates or excessive Fed balance sheet expansion--inflates energy costs indirectly through demand misalignment.

Policy Implications:
We need less tinkering, more trust in price signals, and a better understanding that policy mistakes can leave lasting damage. Markets can adjust, but only if left free to do so. As our research shows, diesel prices don’t return to trend automatically, especially not when heavy-handed policy keeps shifting the goalposts.

My Take:
This paper is another reason why the government shouldn’t try to micromanage energy markets. Structural breaks don’t just happen—they’re often caused by policy itself. Politicians and central bankers would be wise to stop piling on distortions and let competition, innovation, and supply chains do what they do best.
Want prosperity? Let markets price energy. Stop the regulatory chokeholds. Scrap distortive tariffs. Shrink the Fed’s role in distorting credit and commodity prices.

Final Thought:
I’m proud to share this new research with both my academic and policy audiences. Diesel may not make headlines every day, but understanding it is crucial to grasping prices, supply chains, and how government failure can lead to market failure. If we get diesel right, we can get a lot else right, too.
Let’s keep pushing for policies that allow people—not bureaucrats—to prosper.