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A noble purpose - at what cost?
By Kathy Hare

Here’s the dilemma.  America must reduce its carbon emissions while also developing a new energy policy that does not rely on foreign oil. Legislation designed to address both problems is now being debated in Congress. The “American Clean Energy and Security Act of 2009,” is a “cap and trade” bill chuck full of carrots and sticks to encourage the development of renewable energy sources while penalizing industries that pollute. It is sponsored by Rep. Henry A. Waxman, (D., Calif.), chairman of the House Energy and Commerce Committee, and Rep. Edward J. Markey, (D., Mass.), chairman of the Energy and Environment Subcommittee. But is the bill the answer to America’s energy woes? A lot of people on all sides of the political spectrum are screaming, “No!”

I’ve heard rumblings about the Waxman-Markey energy legislation for a while now. The bill is supposed to be the “starting point” in this country’s effort to stop global warming.  According to the current draft its purpose is: “To create clean energy jobs, achieve energy independence, reduce global warming pollution and transition to a clean energy economy.” All noble goals indeed - goals that I would like to see accomplished - but the devil is always in the details.

The U.S. Chamber of Commerce was the first to cry foul, saying the ACES legislation would overburden American businesses by imposing expensive regulations; thus costing American jobs while doing nothing to encourage developing nations to reduce their greenhouse emissions. In the Wall Street Journal, Governor Mitchell Daniels railed, “The Waxman-Markey legislation would more than double electricity bills in Indiana.” He said, “Quite simply, it looks like imperialism. This bill would impose enormous taxes, restrictions, and mandates on free commerce…” Greenpeace also weighed-in, belittling the bill by saying, “Despite the best efforts of Chairman Waxman, this bill has been seriously undermined by the lobbying of industries more concerned with profits than the plight of the planet.”

Ok, the U.S. Chamber of Commerce doesn’t like to see trade hindered one iota. Governor Daniels is a republican, and Greenpeace is never satisfied. So I wondered are these just political, “got to be against it” statements, or are the comments based on fact? I decided reading the Waxman-Markey bill was the best way to find out. Go to http://www.house.gov if you care to read it too; but let me warn you the bill is 932 pages of purely tedious legalese. My head hit the keyboard twice while reading the first 300 pages, so I resorted to liberally scanning the document. Even so, I read enough to assure you that all of these naysayers, including Greenpeace, are making valid points.

Two major components of the bill are the establishment of “renewable” electricity standards and the reduction of greenhouse gases. By 2012, six percent of all retail power sold must come from renewable energy such as solar, wind, hydroelectricity, or biofuels, climbing to 20 percent by 2020. If a power company can’t meet the goal it can buy “renewable credits” from other sources. The bill contains tons of rules governing the sale or trade of the credits, including attaching a unique serial number to each credit in order to eliminate fraud.

Mountain View Electric, member of the Tri-State Generation & Transmission Association, currently produces only 1 percent of its electricity from renewable sources. I asked MVE manager Daryl Edwards for his take on the bill. He said, “The Tri-State office is tracking the bill closely. I understand we need to decrease CO² emissions but I want to see it done fairly and in a way that will not impact our economy anymore than it has to.” However, Edwards added, “overall the Waxman-Markey bill may be better than more stringent regulations the Environmental Protection Agency was prepared to mandate to power companies.”

The goal of the second major component in the legislation is to reduce the amount of CO² and other pollutants every business produces. It “caps” greenhouse gases to the levels produced in 2005, and demands those levels be reduced 20 percent by 2020, and 83 percent by 2050. To reach this goal the government will sell or issue emission “permits.” If a company doesn’t use all of its pollution allotment, it can “trade” its unused portion to other industries who cannot meet the federal standards.

Originally, the sale of these permits was slated to finance $646 billion worth of clean-energy investment programs and tax rebates also included in this bill. Here are just a few of those programs.  Eight “innovation centers” will be established throughout the country to create all forms of “green energy products.” Funds are available for anyone who wants to build “plug-in” stations for electric cars. Industries will be rewarded for capturing carbon before it leaves the smoke stack and injecting it into the ground, even though the science behind this process has not yet been fully studied. Power companies also get financial breaks if their plant can link-up to the “Smart Grid.” The grid allows electric suppliers to meet peak power demands by purchasing electricity from other sections of the country. It also lets both large and small “green energy” producers hook into the power grid. So whether you own acres of solar panels or have a single wind turbine, the “Smart Grid” lets you sell green energy to local electric providers.

There are also rebates available for buying energy efficient and “Smart Grid” appliances, plus bonuses for retail outlets that sell these appliances. A “Smart Grid” appliance contains a microchip allowing it to determine when power demands in an area are low. The rebate will more than cover the earplugs needed to sleep as washers, dryers, and dishwashers are busy working at 2 a.m. However, you will need to look elsewhere for money if you plan on building a new home.

All new construction, including commercial and residential buildings, must be 30% more energy efficient by 2010. Therefore, the days of 2x4 walls filled with fiberglass insulation are probably over. Expect new homes to come equipped with compact florescent bulbs, because if ACES becomes law incandescent bulbs are scheduled for extinction. The Waxman-Markey bill even dictates the maximum wattage allowed for yard lights!

It really doesn’t matter if you plug it in or not, this bill will increase the cost of producing most items made in America. So the U.S. Chamber of Commerce is right, regulations imposed by ACES will cost American jobs. Meaning more goods will be made in China and other countries that don’t give a damn about global warming. And yes, the Greenpeace statement is correct. Eight Texas Democrats, who have oil refineries and cement plants in their districts, have already received special concessions for those industries. Governor Daniels is right too. Taxes have to increase if the Waxman-Markey bill is passed because 69 percent of those emission permits will now be given away. Another 15 percent will be auctioned off, with the revenue going to “low- and moderate- income families to protect them from other energy cost increases.” So get out your wallet, because the only revenue source left to fund Waxman-Markey’s herculean energy reform is you – the taxpayer.

I’m sure you will hear more about the “American Clean Energy and Security Act of 2009.” As far as I can determine, the jobs created by this bill will be in the form of more bureaucrats. And while it may reduce greenhouse emissions in the United States, it may actually cause levels to increase globally. If the bill stays on schedule, Congress will decide if it becomes law before Labor Day. Clean energy makes sense, but so does determining how much this one bill will cost Americans in both jobs and taxes.

First published in The New Falcon Herald
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