Impact of Environmental Policy on Energy

While this is not an exhaustive look at the problems caused by what many would consider bad environmental policy on energy, it does touch upon some real world implications. The problem is that as this policy spreads and is whole-heartedly endorsed by the current administration, it has real world implications that affect our lives.

EPA Endangerment Finding

'Most of the observed increase in global average temperature since the mid 20th century is very likely due to the observed increase in anthropogenic GHG [greenhouse gas] concentrations.'

This is the core assertion in the EPA recent endangerment finding where it has declared carbon dioxide dangerous to human health. The EPA relied upon questionable reports generated by the UN International Panel on Climate Change (IPCC). The data is incomplete at best and 'cooked' at worst. These reports are so suspect that it's amazing that the EPA continues on its current path. Yet, the president and members of congress are dead-set on implementing energy controlling legislation. The emphasis is on energy controlling, because that's what it is!

Solar Power Scandal

The president and members of congress like to point to all the successes around the world regarding 'green' energy production, but the reality is quite different than what they profess. The reality is that the effects of state investment in inefficient and unreliable power sources is detrimental, including loss of jobs, higher energy costs, and reduced growth.

Spain was promoted by the president as the country we should look to regarding solar energy production. The 'green' jobs produced by Spain was a model of what we should work toward. Reality is that Spain’s efforts have been reduced to scandal. There have been a net number of jogs lost due to these efforts and solar power generation has resulted in a 23 percent increase in energy costs just over the last year! But, the scandal gets worse…owners of the solar fields have been placing oil generators next to their solar power plants to simulate more electricity production for which they are reimbursed at the highly subsidized power rate for solar.

New England's Suicide

The following is a reprint of an article from TheStreet.com website. It’s a really good article on how New England is allowing 'green' activists to control the energy debate and is committing suicide in the process. This is what we have to look forward to in the rest of the country should this insanity take hold.

New England's Green and Pleasant Land

Glenn Williams, 4/22/10

Perhaps the "one if by land" lantern was obscured by the shower of sparks flying from the 12 million megawatt hours that winged their way through the three "interfaces" located on the northern edge of New England's grid last year. Yes, according to trading reports, all this happened in 2009. And it continues in 2010.

It is not that the Canadians are bad, they are just taking advantage of the chaos in New England's state houses. Special interest groups are trying to shutter one power plant after another. They have gone after coal plants, large hydroelectric plants and now nuclear power. The only type of power plant that seems acceptable is natural gas -- and even that is being questioned.

For utilities, there are not many alternatives left. Sure, wind and solar are options -- just not in New England. Land-based wind power is impractical, as most locations are not windy enough. There is wind on New England's scenic mountain ridges, but nobody wants to litter them with big, ugly machines. As Rhode Island officials learned, ocean-based wind power is unacceptably costly. Realistically, the amount of wind energy that can be economically harvested in New England is miniscule.

Solar in New England is an oxymoron. New England is one of the grayest regions in the country and located at latitudes were power production is limited. When it is not gray, it is foggy or humid. It takes twice as many panels to produce a kilowatt of power in New England as it does in California. The economics are so bad that Massachusetts is offering developers production incentives of $400-plus per MWh to build solar facilities, more than 10 times current market prices. So when it is nighttime with no wind, where does New England find power? With everything taken off the table, New England has no generating options. And with its only neighbor short on energy, New England cannot look to New York for help. Its only option is to buy bulk power from a foreign country. So much for energy independence.

So, New Englanders are ceding their energy policy to the Canadians. Instead of building safe, economic and reliable plants to replace the retiring units, New England is losing thousands of new and permanent jobs to its northern neighbor, as $500 million a year leaves New England's economy. Not only are New England jobs evaporating, but local taxes have gone with them. Power plants provide communities with a huge tax base.

The problem is not limited to retiring power plants. Canada is providing bulk power that services New England's baseload. When new power comes in at the bottom of the stack, it displaces power at the top of the stack. When Canada supplies New England with nuclear and hydroelectric power, it is placed at the bottom of the stack. The result is that Canadian power frequently knocks off mid-merit and peaking units. It only takes a short time before revenue-starved companies have to shut down, lay off employees and shutter their facilities. Those that survive see lower margins and elusive earnings.

For New England generators, the future looks bleak. More Canadian power is heading their way. Vermont's governor and his state's two largest utilities just negotiated a 25-year bulk power agreement with the Canadians. New Brunswick's refurbished Point Lepreau nuclear generating station will be coming on line next fall. Point Lepreau is owned by state-owned NB Power (Énergie NB). Canada spent CAD1.4 billion to refurbish this plant, and it is sitting right next to a transmission line that is hard wired to New England. Furthermore, the Canadians initiated a multi-year study to build and operate a massive nuclear facility on the same property, with the intention of selling its output to New England.

It is not just energy jobs and taxes that are lost, though. New England consumers are taking a beating as states and activists trade in low-cost megawatts for gold-plated kilowatts. Already New England has some of the highest retail electric rates in the country, and those rates need to stay high to finance $400 per MWh solar projects. Of course, high rates will simply encourage more businesses to leave New England, putting even more pressure on jobs and the tax base.

As New England's activists seek to dismantle more power plants with near-zero carbon footprints and near-zero greenhouse gas emissions, they're effectively exporting their communities' future and economy. As they seek this version of green energy, it seems New England activists have lost their bearings with respect to the greater good.

It wasn't supposed to work this way. The greening of America was supposed to provide jobs, a tax base and energy independence. To America, not Canada.