Regarding the $Billions the Obama administration is planning on levying against the carbon based power generation industry:
(1) Won’t this in essence turn out to be just a tax increase on the power consumer. The utility companies will surely just add the cost of these additional expenses onto your electric bill.
(2) Will it drive utility companies to build new plants in Mexico and export the power back into the US grid from there, thus escaping both the US emission controls and taxation.
How does either of the above help our current situation?
Most proposals for pricing carbon, whether they be cap/trade or carbon tax, are revenue neutral. Yes they increase the cost of power for the consumer who is using carbon intensive produced power (to the degree that the utility is allowed to pass it on - remember that rates *are *regulated) and the money raised by the pricing of carbon is used to offset those increased costs in various ways. Will any of those offsets be a perfect match? No, of course not. Some will benefit and some will end up paying more. The systems of how to offset are varied. But guess what? The waste that is carbon has a price. You’ve been getting away not paying for its waste management up to date but that garbage is still costing us and future generations and we have to pay for it sometime.
As far as importing power … hard in any case to transmit power from Mexico very far into the states so a minor issue overall but easy to make the carbon footprint of imported power count to their cap, just as it is also possible to participate in a global cap and trade system that allows offset to be accomplished anywhere else in the world as well.
Does anyone have a projection of how what % this plan will drive up the average consumer’s electric bill?
In lieu of the already shaky ability of the public to burden their current bills, isn’t this just going to hurt the one’s who can ill afford it the most?
Regulated power industry may not help the consumer… at all. Power companies are usually guarranted a certain safe return (which is why they do do the work). If their costs go up, they will pass it along, because they can and they are alloewd, or even functionally required, to do so. And demand for energy as a whole tends to be very inelastic (oil/gas can be reasonably elastic, but people can’t stop poewring their homes completely).
The biggest problem with this scheme is that it’s going to drive up the cost of goods manufactured in America. Obama can’t simply give the money back to everyone whose prices went up, because that would result in no effect at all (i.e. power companies raise their prices to maintain their profit margins, the government gives people affected by the price increases rebates equal to the prices, and nothing changes other than that the whole system becomes less efficient due to government involvement and deadweight loss in the tax increase).
The fundamental incoherency of Democratic policy is that on the one hand they talk about protecting jobs for American workers, and of revitalizing American manufacturing, but in practice their policies do the exact opposite. Letting the capital gains and business tax cuts expire, as Obama plans to do, will raise the cost of capital and the cost of American manufactured goods. The cap and trade system will further raise those costs, and the changes to union policy will raise them even further.
In addition, Obama says that there’s been too much deregulation of business, and he wants to start imposing more regulations.
This is all very irresponsible, and anti-stimulative. Implementing policies like these while at the same time saying the government needs to spend a trillion dollars on an emergency basis as an economic stimulus is fundamentally incoherent.
But companies making energy intensive products can, and will, move their operations out of the country.
Any moves towards alternative energies that have the effect of raising energy prices for Americans but not for other people around the world will accelerate the destruction of manufacturing jobs in America.
Shrug
Not all regulation is a bad thing, but the main problem is that once the government sticks it oar in, it comes under pressure to keep doing so; regulation breeds regulation.
A limited amount of regulation can actually increase efficiency though.
CEO compensation would fall under overhead expenses. As for limiting their compensation, not all costs can be controlled without a resulting risk. Plus I’m sure any regulation attempts will have more holes than a screen door.
There is yet no evidence that reducing CEO pay increases efficiency. If reducing CEO pay ultimately results in worse leadership, then it could be detrimental. We have no data so far indicating what will ultimately happen, so right now it boils down to an ideological claim, not fact.
Some consumers have moved away from coal-based electricity. Some have done so by choosing plans offered by electric companies which guarantee that their electricity comes from renewable sources. Others have installed windmills or solar panels on their own property. A tax on carbon-based power would not affect these customers; it would only affect those who still get their power from coal plants. So, in a way, Obama’s proposal would reward those who have already chosen to do the responsible thing.
One of the biggest current myths about science is the idea that we can make electricity anywhere and send it to anywhere else at light speed. We can’t. Electricity does not travel through wires at light speed, and as it travels, some of it is dissipated as heat. Somewhere between a third and a quarter of all the electricity generated in this country gets lost that way. For that reason, pumping electricity from Mexico will never be a viable option.
The bottom line is that we somehow need to reduce the amount of carbon dioxide we emit. Any method we choose will have costs, so we can’t simply cross off all the methods that have costs.
Today’s infrastructure can’t even handle current transmission and distribution needs. The costs to a power company to add on infrastructure to transmit power from another country would far outweigh the savings from avoiding carbon caps, even if they could. That said improved transmission should be on our wish list! One option is High Voltage Direct Current (HVDC) which has much less loss with transmission over long distances. I’ve often heard it discussed hand in hand with renewables that are occasionally intermittent - the wind is always blowing somewhere and the sun is always shining somewhere - a linked HVDC supergrid would help average out local variations in power production by transmitting from where it is produced at the moment to where it is needed at the moment more effectively, perhaps even tying into some large storage system (such as pumping water up reservoirs and using that to produce hydroelectric power when the wind is insufficient everywhere). It’s the opposite approach from going to true distributed generation, which also is an response to our current insufficient infrastructure.
Except the ones with the highest paid CEOs, the ones that just trashed our economy. retirement funds, investments, put people out of work, and on the street.