if the energy companies are paying their customers, won't the companies run out of money eventually?
and if they run out of money, then won't they have to be subsidized by the government? and if that happens, isn't that basically people paying taxes, which go to the electric company, which go back to the people?
In the United States, for example, we have an extremely complicated mixture of local and state-level economic, infrastructure, and supply regulations, environmental regulations that are mostly federal (though also state), zoning, eminent domain, and other kinds of permitting. Then, alongside all those, we have massive subsidies of electricity distribution infrastructure, extraction of coal and oil, transportation, and "homeland security." Finally, we also have relatively small subsidies for wind and solar.
Germany made a policy decision some years ago that public subsidies of renewables would create large positive social externalities. So, yes, the money goes around in a circle, but -- to over-simplify -- in theory creates more money (technology development, improved resistance to economic shocks, jobs, public health) and better outcomes of various other kinds (public health, reduction of climate change risks of various kinds, reduction of risk from nuclear plants, perceived electoral advantages by the political parties in power) as it goes around.
- Only the major industrial customers actually see the negative rates (residential customers are still paying retail)
- In many regulatory environments the electric utility and power generators are different companies, so only the generators are at risk of losing money and shutting down plants