Last week Erin, in support of the “People’s Climate March,” argued for policies called “cap-and-trade” which essentially set emission caps on companies and then allow them to buy and sell these emission permits with each other. However good or bad this program may be, it is not the only “pro-climate” program being proposed and implemented. When evaluating climate and energy policy, the most important component is a simple cost-benefit analysis. I will admit, all this information so far was covered last week; however what was never discussed were the costs and the benefits themselves.
I’m a fan of good news first, so let’s start with the benefits of cap-and-trade, renewable energy mandates, and other “green” initiatives. I’m going to go out on a limb and say that the goal of these programs is to actually combat climate change. Well, unfortunately that is hard to assess, but the inconvenient truth for the eco-liberals (cue Thomas Steyer) is that the science at best is inconclusive (I’m sure I will get an earful about this). I will be the first to admit that climate science is not my expertise, so let us consult the experts. The Intergovernmental Panel on Climate Change (IPCC) in 2013 produced a global report on this very issue. The IPCC estimates that by 2100 we will see a three degree Celsius increase in temperature. Obama, being a man with many strategies, has a plan to reduce emission to 17 percent less than 2005 levels. The American Enterprise Institute (a well-respected think tank in Washington, DC) has used the National Center for Atmospheric Research’s climate simulator to estimate that even if the entire world adopted Obama’s plan, it would only reduce warming by 0.15 degrees Celsius. Those are the long-term benefits. It is worth noting that the IPCC also mentions in their report that we have reached a “pause” in climate change, which contradicts original projections and trajectories cited by the aforementioned eco-liberals. The IPCC also failed to find any significant increase in extreme weather or evidence that would suggest sea-level increases in years to come.
The other side of the coin are the costs. Most environmental-protection plans, like cap-and-trade, seek to shift the “costs” to the firms themselves. This is essentially done by putting a price tag on pollution and the like. These new taxes and regulations can cause businesses to cut jobs, close altogether, or move. This is a simple explanation for the costs of measures like cap-and-trade and carbon taxes, but policies like the renewable energy mandates are harder to grasp.
Renewable energy mandates are programs in which states decide how much of their energy supply must come from renewable areas like wind, solar, and water. Sounds great, right? Well, renewable energy sources pose some issues. First and foremost they are reliant on the weather, which is unpredictable. In addition, wind and solar farms take up massive tracts of land.
In 2010, California generated 20 percent of its power from renewable sources, but California’s energy prices were double that of other states without such a mandate, according to the Institute for Energy Research. The biggest problem with these mandates is that they distort the markets and hamper competition. These mandates harm cleaner, but not renewable energy sources, like nuclear and natural gas.
Nuclear plants produce electricity with zero carbon emissions. We also have an abundance of natural gas, which burns much cleaner than other energy alternatives, like coal. Former House Speaker Nancy Pelosi (D-CA) is a big supporter of natural gas. The Democrat from San Francisco famously said: “I believe in natural gas as a clean, cheap alternative to fossil fuels”. The now minority leader is half right. These mandates, even though they promote certain sectors of our energy production, actually hurt our energy diversity, which is key to keeping prices down and insuring our energy security for the future. The increased energy prices, as an effect of energy mandates, result in an increased cost to households and businesses in California, which already face their fair share of economic hurdles.
Now that it has been established that heavy-handed governmental programs like cap-and-trade and renewable energy mandates are costly and won’t even come close to solving our possible climate problems, I feel it is important to discuss the direction we should be headed. I feel the goal of environmental policies should be to reduce local pollution, in order to keep our cities and neighborhoods clean. This task is best solved on the demand-side. In other words, because energy is a necessity, it is sounder to try to reduce consumption, and I think this is best done at the individual consumer level, through incentives. There are many things individuals can do to reduce their carbon footprint that the markets and the government should, and often are incentivizing. First and foremost, fuel efficient and electric cars. One thing the state of California does that is very good is it allows fuel efficient cars to drive in the carpool lane and avoid paying tolls in rush-hour. This law has incentivized my family to own a 2003 Prius (which is covered in stickers, including one for Romney), a 2012 Prius plug-in, and a Tesla Model S. On top of that, everybody likes saving money at the pump. The second is solar panels. A tax credit on solar panels for households could be an effective way to reduce carbon use as well as help families with their electric bills (given that will take time and depends on the upfront costs and value of the tax credit). I believe there are many things each individual can do as a form of environmental stewardship, which is very important in the battle to conserve our nation’s valuable resources. Many of these initiatives save individuals money on electric bills and at the pump, without harming our economy as a whole.
So far I have touched on a lot of issues, all of which are important. However, none of these issues will be deciding factors in any major 2014 race. Many Democrats in key states are backing away from climate issues all together. This list includes Mary Landrieu (D-LA), Natalie Tennant (D-WV), and Mark Begich (D-AK). And then there is Alison Grimes of Kentucky, who thinks she can campaign with coal-makes-us-sick Harry Reid (D-NV) and then claim to be pro-coal. Nevertheless, most Americans will make a decision in 2014 based on the state of the economy and other issues that affect their pocketbooks, not climate change.
Artwork by JENA RITCHEY
