Is EPA Shutting Down Your Power Plant?

A recent report from the Institute for Energy Research revealed that 72.7 gigawatts (GW) of power have closed or are scheduled to close because of EPA’s Mercury and Air Toxics Rule (colloquially called MATS or Utility MACT), the proposed Cross State Air Pollution Rule (CSAPR), and the recently proposed restrictions on carbon dioxide emissions from existing power plants. This is enough electricity to reliably power 44.7 million homes, or every home in every state west of the Mississippi River, excluding Texas.

There are 37 states with projected power plant closures. View the interactive map below to see how your state is being affected by EPA regulations:

Public Enemy #1

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Secretary of State John Kerry needs to get his priorities straight. Recently he was quoted saying “threats posed by climate change should be addressed with as much ‘immediacy’ as confronting the Islamic State in Iraq and Syria (ISIS), and the Ebola outbreak.” Iraq is in shambles, the battle for Kobani rages on in Syria, and as Vox reports the Ebola epidemic could be even worse than we thought:

The World Health Organization projects that 20,000 people will be infected in November. HeathMap, put the number at about 14,000 if there’s no improvement in the situation.

But in worst-case scenario, the Centers for Disease Control and Prevention project that up to 1.4 million people could be infected by January.

Putting climate change in the same breath as nations ridden with civil wars and crippling diseases shows just how disconnected from reality Mr. Kerry is.

Using More Energy Helps the Planet

National Journal recently published an article with the somewhat exaggerated headline, “Why Natural Gas Won’t Help Save the Planet.”

The story cites a study in Nature which equates “saving the planet” to “slashing global greenhouse-gas emissions.” But what do they say about the role energy plays in improving the planet? The report goes on to state, “Lower natural gas prices accelerate economic activity, reduce the incentive to invest in energy-saving technologies, and lead to an aggregate expansion of the total energy system: a scale effect.”

National Journal’s headline implies that “accelerated economic activity” and “expansion of the total energy system” are threats to the planet. What those abstract terms really represent is the ability for human beings to live longer, healthier, more productive lives.

For example, the Institute for Energy Research analyzed the role that higher energy consumption and electricity generation played in human development in China and India. The following charts indicate that as energy use and electricity generation have risen, so have economic growth, access to improved sanitation facilities, and life expectancy at birth, while child mortality has dropped:

China Energy Use

India Energy Use

We should focus more on improving the planet for humans than on making sure humans alter the planet as little as possible. The reality is that using more energy to pump water, provide light, and refrigerate food and medicine makes social and economic development possible. “Saving the planet” should mean improving the lives of people on the planet.

 

No More Carbon Taxes in the Land Down Under

Australia’s carbon tax was so disastrous that some of its biggest supporters are hastily distancing themselves from it — and lawmakers in the U.S. should take note.

The Sydney Morning Herald reported this week that the democratic socialist Labor Party is officially bailing on support for a carbon tax. Party leader Bill Shorten announced:

“We will not have a carbon tax, the Australian people have spoken and Labor is not going to go back to that.” [Emphasis added]

The carbon tax was such a disaster that much of the 2013 Prime Minister election was centered around the tax. Then-candidate for Prime Minister Tony Abbott said, “More than anything, this election is a referendum on the carbon tax.”

Abbott went on to win the election in part by pointing out the damages caused by the carbon tax–including higher electricity prices and greater unemployment. A peer-reviewed study from 2013 by Dr. Alex Robson of Griffith University in Brisbane laid out the economic pains the carbon tax caused Australian families:

  • In the year after Australia’s carbon tax was introduced, household electricity prices rose 15%, including the biggest quarterly increase on record.
  • The job market had previously been stable, but after Australia’s carbon tax, the number of unemployed workers has risen by more than 10%.
  • Carbon dioxide emissions have actually increased, and will not fall below current levels until 2043, according to the Australian government.

The following chart from Dr. Robson’s study also maps the ways in which a carbon tax and similar “green” schemes have forced households in Queensland (QLD) and New South Wales (NSW), Australia to pay higher electricity bills:

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As a result of these negative impacts, Australians spoke loud and clear on election day when they voted in Tony Abbott as Prime Minister. And even the Labor Party, once a staunch supporter of the carbon tax, is distancing itself from the carbon tax.

Although Australians recognized that the carbon tax was destroying their economy, many U.S. policymakers and pundits continue to support implementing a similar system in the U.S. Just recently, Senator Mark Udall from Colorado touted his support for a price on carbon dioxide emissions:

Australia’s carbon tax brought higher energy costs and unemployment to its citizens. To prevent these same outcomes in America, our policymakers should heed the warning signs in Australia and drop their support for a carbon tax, or risk paying the political price of ignoring the priorities of the American people.

Engineering America’s Tomorrow at the Colorado School of Mines

America’s energy boom has created an abundance of high-paying and secure jobs in the oil and gas industry at a time when other sectors of the economy continue to struggle. As a result students are flocking towards degree paths that will help them break into the industry.

For example, the Colorado School of Mines has seen annual enrollment for undergrad petroleum engineering increase from under 300 to 900 in the last ten years. And it’s not alone. The University of Wyoming and the University of North Dakota have also seen record growth in petroleum engineering enrollment numbers.

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Students pursuing this degree path can expect a high-paying job in a rapidly growing field.

According to the Bureau of Labor Statistics (BLS) the median pay for a petroleum engineer in 2012 was $130,280 per year. That’s nearly four times the median pay across all occupations.

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Not only is the pay good–the demand for petroleum engineers is climbing. The BLS projects that employment of petroleum engineers is projected to grow 26 percent from 2012 to 2022, significantly higher than the 11 percent growth rate projected across all occupations.

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As many young Americans are investing their future in America’s energy boom, the oil and gas industry is investing in their education. For example, the industry is paying for new equipment and classrooms at the Colorado School of Mines. And the oil company Schlumberger is even paying one of its employees to be an adjunct professor at the school.

America’s energy boom is providing job opportunities that simply didn’t exist ten years ago.  In an economy where many recent college graduates face unemployment or underemployment, the oil and gas industry is an encouraging bright spot that will only continue to grow

Wind PTC Gives to the Rich at the Expense of the Taxpayer

In a recent speech, former U.K. Environment Secretary Owen Paterson compared the U.K.’s Climate Change Act to the policies of the infamous Sheriff of Nottingham in the story of Robin Hood:

“It amazes me that our last three energy secretaries, Ed Miliband, Chris Huhne and Ed Davey, have merrily presided over the single most regressive policy we have seen in this country since the Sheriff of Nottingham: the coerced increase of electricity bills for people on low incomes to pay huge subsidies to wealthy landowners and rich investors.” [Emphasis added]

Paterson specifically pointed out policies that subsidize wind, which are expected to cost the U.K. 1.3 trillion euros by 2050.

The United States faces a similar problem with the decades-old wind Production Tax Credit (PTC), which provides wind producers with a subsidy from the American people of 2.3 cents per kilowatt hour. Although the wind PTC expired at the end of 2013, Congress is under pressure from the American Wind Energy Association (AWEA) and the Internal Revenue Service (IRS) to extend the tax credit via a tax extenders package (the IRS has already given wind producers very favorable treatment on existing provisions). Senate Majority Leader Harry Reid has made it clear that passing tax extenders will be a top priority going into the lame duck session.

But an extension of the PTC would not come cheap. The Senate Finance Committee estimates that a two-year extension would cost taxpayers $13.35 billion.

Not only do Americans pay for the wind PTC in their taxes, but also through higher energy prices, as First Energy CEO Anthony Alexander explains:

“Subsidies such as the Production Tax Credit encourage developers to build whether or not the generation output is needed. This unneeded, excess capacity is not only uneconomic, but it puts additional pressure on baseload coal and nuclear assets that are essential to grid stability and affordable energy prices.” [Emphasis added]

Just like the Sheriff of Nottingham, the PTC gives to the rich at the expense of average taxpayer. As billionaire investor and Berkshire Hathaway CEO Warren Buffett said:

“I will do anything that is basically covered by the law to reduce Berkshire’s tax rate. For example, on wind energy, we get a tax credit if we build a lot of wind farms. That’s the only reason to build them. They don’t make sense without the tax credit.”

Reinstating the PTC will only put more of a financial burden on the American people while lining the pockets of billionaires and subsidy-chasing corporations. U.S. policymakers should echo the calls of Owen Paterson in the U.K. and put an end to subsidies like the wind Production Tax Credit once and for all.

Governator Encourages the World to Be More Like California — But Should He?

The Governator is back, only this time he’s here to promote California’s failed energy policies on a global scale. Two-term governor of California and Terminator legend, Arnold Schwarzenegger presided over a climate conference which was hosted by his group “R20 Regions of Climate Action”. The conference ended in an unbinding pledge by several regional groups to join the fight against global warming.

In his remarks at the conference, Schwarzenegger touted California’s success:

“Our organization, the R20 and I, we are big believers in a regional approach, in the sub-national approach, that while maybe the UN does not come to an agreement right away, and hopefully when they have the negotiations in Paris they will come to an agreement, but to utilize also the sub-national governments because we in California have been very successful without the help of the national government.” [Emphasis added]

In truth, Schwarzenegger’s policies in California have only continued the state’s legacy of expensive energy.

As governor of California, Schwarzenegger pushed hard for “green” energy policies in the name of climate change, including a mandate that 33 percent of retail electricity sales come from renewables by 2020 and a low carbon fuel standard (LCFS), which forces transportation fuel producers to reduce the amount of greenhouse gas emissions used in the manufacturing of fuel or to purchase credits to offset their impact.

As a result of California’s energy policies, the state now suffers from some of the highest electricity costs and gasoline prices in the U.S.:

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And if it weren’t enough to harm California’s energy situation, Schwarzenegger has taken it upon himself to promote these types of policies around the world through R20 Regions of Climate Action. The truth of the matter, though, is that a bigger global problem than climate change is energy poverty.

In 2011, 1.3 billion people did not have access to electricity, almost a fifth of the global population. Developing nations are focused on increasing access to affordable energy for their citizens, not on implementing policies that will make energy more expensive. In fact, the leaders of China and India skipped the recent UN climate summit because the UN’s renewables push would threaten reliable energy and human development in both countries.

We may not be able to go back in time, as Schwarzenegger did in Terminator, and warn Californians about Schwarzenegger’s disastrous policies, but countries should look to his failures as an example of what not to do.

Detour

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Kerry’s Crusade

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Massachusetts’ electricity rates to increase by 37 percent this winter

The National Grid, a utility that provides electricity and natural gas to 3.4 million customers in Massachusetts, New York, and Rhode Island, just announced they were increasing electricity prices by 37 percent over last year to their customers in Massachusetts:

“September 24, 2014 – National Grid recently filed with the Massachusetts Department of Public Utilities (DPU) to adjust electric and gas rates for the winter. The company’s electric customers will see a significant increase in their bills due to higher power supply prices (the cost of the electricity National Grid buys for customers and passes on without a mark up). Starting in November, a typical residential customer will see an electric bill that is 37 percent higher than last winter for the same amount of electricity used. ”

A 37 percent increase could make Massachusetts electricity rates the second highest in the country, behind only electricity rates in Hawaii. Currently, the average retail electricity rate in Massachusetts is 16.27 cents per kilowatt hour. An additional 37 percent would make the average retail rate 22.29 cents per kilowatt hour in Massachusetts.

As Roger Bezdek and Frank Clemente explained in a study earlier this year, ” policies  which hurt the U.S. coal fleet are placing the reliability, affordability, and security of  America’s electric supply system at risk.” Massachusetts is demonstrating, through it’s policies, what happens when coal is removed from electricity generation without sufficient infrastructure for backup. This 37 percent increase is just the beginning of electricity affordability issues for New England.