CEI in OCR on Energy Regs

by William Yeatman on January 23, 2012

in Blog

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Last week I spoke with an editorialist at the Orange County Register, about the silliness that is the California Energy Commission’s latest efficiency mandate, for battery chargers. On Saturday, the paper ran an editorial about our conversation. The entire editorial, “Bureaucrats Eyeing Your Device Chargers,” is reprinted below. Afterwards, I have two extra thoughts on energy efficiency policy.

It’s enough to make the Energizer Bunny pound his drum in protest. This month the California Energy Commission imposed new regulations – the Appliance Efficiency Standards for Battery Chargers. According to the CEC’s website, “The purpose of this rulemaking is to adopt efficiency standards, certification and marking requirements for large and small battery charger systems.”

The CEC website states that, starting in 2013, new battery chargers will be “more efficient and waste less energy.” It claims electricity ratepayers will save $306 million a year, enough juice to power 350,000 homes. And, of course, the environment also supposedly will be improved

We’re doubtful the savings could be reached. More-efficient battery chargers likely will cost more; otherwise they’d already be available. “There’s a fluid market for batteries and chargers on the Internet,” William Yeatman told us; he’s an energy policy analyst at the Competitive Enterprise Institute, a free-market think tank. “Who knows to what extent consumers will circumvent the regulations?”

Indeed, people already shop online for batteries, chargers – and everything else – to seek a price advantage. Mr. Yeatman said it’s unlikely California regulators could prevent the import of contraband battery chargers from other states. That would mean inspecting the literally millions of items listed at Amazon, eBay and other online stores, or intercepting U.S. Postal Service, FedEx and UPS packages at the points of entry into California.

Another problem for the CEC regulators is that federal courts have come down in favor of a broad interpretation of the Commerce Clause of the U.S. Constitution. The clause grants to the federal government, not the states, the regulation of goods and services that cross state lines.

Mr. Yeatman pointed out that, just last December, a federal judge halted California’s low-carbon fuel standards. In the words of Judge Lawrence J. O’Neill, “The purpose of the Commerce Clause is to protect the nation against economic Balkanization.” The case is on appeal.

Mr. Yeatman also pointed out that dictates of market activity often have unintended consequences. For example, he said, federal conservation standards for washing machines means “they don’t clean clothes as well.” And the federal Corporate Average Fuel Economy standards for cars have yielded smaller cars, which are inherently less safe than larger vehicles.

Finally, we’re again troubled by how yet another unelected government agency issues these edicts. If this is a good idea, the Legislature should enact it. Or it should be put on the ballot for voter approval. To recharge democracy, California should unplug unaccountable agencies like the CEC.

I’ve two extra thoughts.

First, energy efficiency mandates are illogical. Consumers have every incentive to conserve energy. They don’t need the government to tell them to do so.

Second, energy efficiency mandates aren’t nearly as effective as their proponents claim. Fetishists of energy efficiency in California invariably cite the fact that per capita electricity consumption in the State has remained steady since the 1970s, when then (and now) Governor Jerry Brown started implementing regulations. Of course, the implication is that the mandates caused this outcome. But they’ve got it backwards. California’s green energy policies have been effective—in raising the price of energy. Citizens of the Golden State have long been subject to some of the most expensive utility bills in the country. And as a result of obscenely high electricity rates, electricity consumption has remained low. According to an important study by two Stanford researchers, policy accounts for only 20 percent of the fact that per capita electricity rates have remained flat in California. The study is available here.

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