TPPF COMMENTARY: Unrealistic Energy Policies Harm Consumers

Earlier today, the Public Utility Commission of Texas approved a $5 billion plan to build new electric transmission lines from proposed West Texas wind farms to energy consumers in the eastern half of the state. In this week's commentary, natural resources policy analyst Drew Thornley discusses how this and other energy policies adopted by all levels of government in the name of the environment have harmed every consumer and every sector of the economy.

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Unrealistic Energy Policies Harm Consumers

By Drew Thornley

Later this month, the Environmental Protection Agency will rule on Texas Governor Rick Perry’s request for a one-year, 50 percent waiver from the federal ethanol mandates that are driving up feed costs for the state’s livestock and poultry producers. Granting the request would be a welcome break from three decades of unrealistic and counterproductive energy policies that have harmed every consumer and every sector of the economy.

The federal government’s costly energy missteps are plentiful — relying on foreign countries and an oil cartel for petroleum, refusing to tap our nation’s abundant natural resources, and burdening businesses and industries with billions of dollars in environmental-law compliance costs top the list. But the ethanol example is instructive.

Last December’s federal energy law requires annual increases in domestically produced ethanol. Within months, the folly of the ethanol mandate was clear: Corn prices have tripled over 2006 levels — contributing to global food-price shocks and food riots — while two scientific studies revealed corn-ethanol production increases carbon emissions rather than reducing them.

The ethanol mandate shows the potential harm when government makes decisions instead of markets and technology. Grocery bills and animal-feed prices are up, thanks to a fuel that has not lessened our foreign oil dependence, requires an inordinate amount of water for its production, and is less efficient than gasoline.

Unrealistic energy policy is not limited to Washington, D.C. Numerous states clamor for “green” status — picking energy-supply winners and losers and rushing to judgment in the ongoing and unsettled debate on greenhouse-gas emissions. Environmental groups have virtual veto authority over cleaner coal-fired power plants, nuclear facilities, and oil refineries, which can meet an exponentially larger portion of energy and electric demand than the heavily subsidized renewable energies.

Last October, Kansas’ environmental regulator denied air-quality permits for two 700-megawatt coal-fired electric generation plants over concerns about carbon-dioxide emissions. More recently, a state judge in Georgia ruled a proposed 1200-MW coal plant cannot move forward unless its CO2 emissions are limited. Environmental groups plan to use the Georgia ruling to block about 30 proposed coal plants currently subject to litigation.

In Texas, legislative mandates to increase the amount of renewable-energy consumption and the requirement of building transmission lines from West Texas wind farms to Central and East Texas load centers will cost Texas electric ratepayers at least $5 billion.

Cities also impose “green” costs on consumers and taxpayers. The Austin Climate Protection Plan is an overly burdensome attempt to “make Austin the leading city in the nation in the fight against climate change.” Never mind the fact that the Plan cites a non-existent climate-change “consensus,” is based on the findings of the thoroughly discredited United Nations Intergovernmental Panel on Climate Change, and seeks to achieve renewable-energy and climate-neutrality goals through the use of technologies not currently viable on a commercial scale.

The Energy Information Administration reports that, as of January 2008, the collective year-to-date contribution of coal, natural gas, and nuclear power to our nation’s total electricity generation was 89.6 percent. In 2030, non-hydropower renewables, including wind and solar, will contribute just 2.83 percent to the United States’ total energy production. Consumers deserve energy realism, not fanciful plans to replace fossil fuels with renewables.

When misguided environmental theory dictates energy policy, the result is high prices, unreliability, and inadequate supply. It is time to reverse course. As our energy needs grow, we must tap our domestic resources in smart and efficient ways. No longer should we send hundreds of billions of dollars to rogue regimes, burn our food for inferior fuel, and mandate insufficient renewables, while blocking the building of power plants that will give us clean, affordable energy.

The prospects for more substantial energy and environmental regulations, mandates, and taxes arguably pose the greatest threat to our economy and the well-being of our citizens. We need affordable, reliable energy, but we will never get it without a realistic energy policy.

Unless and until judges and policymakers begin making common-sense decisions, based on the efficacy of supply and demand and with the long-term health of the economy in mind, our nation, our states, and our communities will continue down a path of actions that do little to help the environment yet do much harm to those living in it.

Drew Thornley is a natural resources policy analyst at the Texas Public Policy Foundation, a non-profit, free-market research institute based in Austin.

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Truth is conveniently missing from global warming debate

On Monday, former Vice President Al Gore brought his "Inconvenient Truth" speaking tour to the Frank Erwin Center at the University of Texas at Austin. But no matter how many times he uttered his claim that "the debate is over" on man-made global warming, a sizable portion of the scientific community would beg to differ. In this week's commentary, Drew Thornley, a policy analyst in the Foundation's Center for Economic Freedom, notes the devastating effects on mankind if we make hasty and far-reaching policy decisions based on political pressure instead of solid science.

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Truth is conveniently missing from global warming debate
By Drew Thornley

If the popular press is your source for climate science, you are probably terrified the end is near—moving as far inland as possible and staying inside to avoid heat stroke. You might be altering your lifestyle to combat the effects of carbon dioxide emissions. But if you look at the facts about “global warming,” the picture is not as bleak as it may seem.

Whenever anyone refuses to debate an issue and repeatedly asserts the “debate is over,” red flags should go up. Al Gore, who brought his man-made global warming message to Austin on October 1st, claims the debate is over. But as MIT Professor Richard Lindzen says, this is “a clear attempt to establish truth not by scientific methods but by perpetual repetition.”

Findings released in September reveal more than 500 scientists have published research findings refuting one or more elements of man-made global warming theory. The climate debate is anything but over.

However, even if human-created global warming were proved, there would still be no need for alarm. Gore and other global warming alarmists insist increased global temperatures are bad. On the contrary, a warmer earth would be a net benefit to us all.

Uninhabitable and inarable land could become suitable for living and farming. More carbon dioxide in the air means healthier plants and trees. Better agriculture raises living standards and reduces poverty.

Warmer temperatures reduce energy bills, as savings on heating costs are estimated to exceed added cooling costs. Additionally, cold causes twice as many deaths as heat, worldwide; seven times as many in Europe. Warming is positive and shouldn’t be feared.

However, even if we ignore all of the evidence and allow that man is causing harmful warming, carbon dioxide-reduction projects are still terrible investments. The European Union (a party to the Kyoto emissions treaty) spends vast amounts of money to curtail emissions, but, since 2000, the EU’s increase in emissions is almost double that of the United States (a non-Kyoto country). Even if all Kyoto-signees curb their emissions, those reductions will be offset by massive increases from non-Kyoto developing countries, like China and India.

At the Copenhagen Consensus Center, top-level economists (including four Nobel laureates) evaluated 17 global priorities, from an investment standpoint. The three climate initiatives claimed the bottom three spots, all categorized as “Bad Opportunities,” meaning “for each dollar spent, we would end up doing much less than a dollar worth of good for the world.”

Pumping vast sums of money into global warming makes no sense, when the same money could lead to actual solutions to genuine global problems, such as malnutrition, dangerous water and unsanitary living conditions, HIV/AIDS, and malaria.

Cutting emissions will negatively impact the reliable, efficient energy supply that has been, and continues to be, crucial to Texas’ economic growth. A booming energy market has opened the floodgates of economic prosperity here, and decreasing the energy supply or artificially raising its costs will harm all sectors of our economy.

Measures proposed by climate scaremongers to reduce carbon dioxide emissions threaten our economic prosperity. That reality, rather than the possibility of melting ice caps and rising sea levels, is a genuine cause for concern.

Drew Thornley is a policy analyst in the Center for Economic Freedom at the Texas Public Policy Foundation, a non-profit, free-market research institute based in Austin.

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