June 2013

This week’s National Journal energy insiders blog poses the question: “Should Obama Go Big on Climate Agenda?” What I’m about to post here is I would have posted there, except that I don’t know how to operate the new and improved self-publication program!

My title would have been: “Obama Should Upend Climate Agenda.” Here goes.

In his address tomorrow at Georgetown University, President Obama is expected to lay out a climate change action plan featuring carbon dioxide (CO₂) emission limits for existing power plants, tougher efficiency standards for homes and appliances, and more renewable energy development on public lands.

There are strong reasons to oppose each element of this plan.

Renewable energy is costly, intermittent, and unreliable. If it weren’t a bad buy for consumers, Congress would not need to subsidize it (in perpetuity – if President Obama gets his wish), nor would 30 states and the District of Columbia need to mandate it.

Before environmentalists start cheering, they should remember that subsidized, mandated wind energy slices and dices vast numbers of bats and birds, including endangered species. The Obama administration has never fined or prosecuted a wind farm for killing a protected bird. As one former Fish and Wildlife official described the administration’s policy: “If you electrocute an eagle, that is bad, but if you chop it to pieces, that is OK.” Accelerating renewable energy development on federal lands will likely lead to more bat and avian mortality and a further retreat from honest enforcement of the Migratory Bird Treaty Act and the Bald and Golden Eagle Act.

As for appliance efficiency standards, the one thing they invariably do is limit consumer choice. From toilets that don’t flush to washing machines that don’t get clothes clean to automobiles that provide less protection in crashes, efficiency standards can make products less valuable even while making them more costly.

Proponents claim the payback in reduced electricity and fuel expenditures more than offsets the increase in purchase price. But if these technologies will save us money, why do we need a law forcing us to buy them?

Ironically, energy efficiency standards are an inefficient climate mitigation strategy.  A major review by the Breakthrough Institute concluded: “There is a large expert consensus and strong evidence that below-cost energy efficiency measures drive a rebound in energy consumption that erodes much and in some cases all of the expected energy savings.”

The administration’s proposed CO₂ emission limits for existing power plants pose the biggest risk to consumer welfare and the economy. Like it or not, coal still provides the largest share of U.S. electric power. At best, CO₂ emission limits make electricity more costly. At worst, they can destroy coal as an economically-viable electricity fuel and force coal power plants to shut down.

Let’s briefly review the unsavory history of this policy. [click to continue…]

On Thursday, the R Street Institute and the Heartland Institute held a debate in a Washington, D.C. auditorium on the proposition: “Resolved: Under no circumstances should conservatives support a tax on carbon emissions.” About 150 people attended.

Arguing for the proposition were James Taylor of Heartland and David Kreutzer of the Heritage Foundation. Arguing against were Andrew Moylan of R Street and former Rep. Bob Inglis (R-S.C.) of the Energy and Enterprise Institute.

After the debate, moderator and Reason Foundation science correspondent Ron Bailey called for a division of the house. A majority of the audience opposed the proposition. The next day Bailey reported on Reason’s blog that “About 60% of Conservatives Support a Carbon Tax.” When this headline provoked the ire of some conservatives, Bailey said it was meant to be somewhat tongue in cheek.

Whether offered in jest or not, Bailey’s headline is false. Had he put the question to the 150 or so movement conservatives who attend Grover Norquist’s Wednesday Meeting, the head count might have been 148-2 — with only Moylan and Eli Lehrer of R Street standing in favor of a carbon tax.

Most people who attend carbon tax events in D.C. are ‘progressives.’ I suspect many who came to the debate were staunch carbon taxers and would not have stood for the proposition even if Taylor and Kreutzer dazzled with the oratory of Abe Lincoln and Dan’l Webster.

An unfortunate word choice may also have tilted the straw poll against the proposition. Prudence counsels us never to say never. In some circumtances, bad choices are the only way to avoid even greater evils. The categorical formulation (“under no circumstances”) made the proposition literally unreasonable.

Here’s what the debate was really about: “Resolved, a carbon tax is a conservative idea whose time has come.” That proposition is almost farsical on its face. Even some greenies in the room might have had to swallow hard before standing up for it.

Let’s review some of the back and forth.

Do carbon taxes pick winners and losers?

Inglis led off by arguing that a conservative energy policy does not “pick winners and losers.” What conservatives want is an “impartial cop on the beat.” That’s a carbon tax, which applies equally to all forms of energy and then lets the “free market” decide. Not so — not even close.

A carbon tax discriminates against carbon-based (fossil) fuels. That’s its core function! Inglis might as well say that a nuclear tax applies equally to all forms of energy and lets the free market decide. Just because the market sorts out the effects of a discriminatory tax does not make the tax non-discriminatory. [click to continue…]