Wednesday, June 22, 2005
Global warming is a hot issue in Congress right now, but not just because of pressure from the usual suspects in the radical eco-activist movement. Instead, a few businesses are leading the charge — which happens to be calculated to fill their coffers at the public's expense.
Though Americans already have successfully dodged the global warming bullet twice — the Senate rejected the international treaty known as the Kyoto Protocol (search) by a vote of 95-0 in 1997 and President Bush pulled the U.S. out of the treaty in 2001 — there are three bills in the Senate that supporters are trying to attach to the energy legislation moving through Congress.
The bill that looks like it has the most support — but not yet enough to pass at the time of this column — was introduced by Sen. Jeff Bingaman (search), D-N.M. It favors nuclear power, mandates limits on emissions of greenhouse gases, and would make consumers financially responsible for emissions in excess of permitted levels.
Bingaman's bill was developed from the recommendations of a group calling itself the National Commission on Energy Policy (search) — a somewhat misleading name since it has none of the federal government backing that its name implies. The NCEP, in fact, was established by a group of left-leaning private foundations, including the Pew Charitable Trusts, the MacArthur Foundation and the Packard Foundation.
These foundations have supported global warming alarmism for some time and so their support of emission caps is hardly unexpected. The NCEP, however, is co-chaired by John Rowe, the chairman of Exelon Corporation (search), the largest operator of U.S. nuclear power plants.
While it's understandable that Exelon supports increased use of nuclear power, what seems far less above-board is the company's effort through NCEP and the Bingaman bill to tax its competitors — producers and users of oil, natural gas and coal — thereby making consumers pay higher prices for energy.
Under the Bingaman bill, for example, power plants and industrial facilities whose emissions of carbon dioxide exceed allowances (to be determined in the future by government bureaucrats) would be forced to purchase “extra” allowances from the federal government at a cost of $7 per ton of carbon dioxide released.
For a coal-burning utility company like American Electric Power, which emits more than 220 million tons of carbon dioxide annually, the cost of extra allowances could be substantial and would most likely be passed on to consumers.
The Bingaman bill would make nuclear-generated electricity from the likes of Exelon more competitive price-wise with coal-generated electricity from the likes of AEP.
This might make sense if there were some tangible and worthwhile benefits to be derived from favoring nuclear power over coal, but in terms of global warming at least, there don't seem to be any.
The Competitive Enterprise Institute's Marlo Lewis estimates that the Bingman bill would cost $331 billion in lost productivity between 2010 and 2025 while perhaps avoiding an insignificant 0.008 degrees Celsius of potential global warming by 2050 — a projection in line with JunkScience.com estimates that the Kyoto Protocol has cost about $49 billion since its inception in February 2005 while possibly averting about 0.0005 degrees Celsius of warming by the year 2050.
Competing with the Bingaman bill is legislation introduced last year by Sen. John McCain, R-Ariz., and Sen. Joseph Lieberman, D-Conn., which, like the Kyoto Protocol, would establish a national cap on industrial emissions of greenhouse gases. This Kyoto-in-disguise legislation would also establish a trading system under which industrial facilities could buy and sell greenhouse gas emissions allowances.
But even with its absurd provisions for trading hot air permits as if they were valuable commodities, McCain-Lieberman is a bill that only appeals to environmental activist groups. Even global warming-friendly oil company BP opposes the bill's mandatory emissions caps, in favor of a third global warming proposal — a bill introduced by Sen. Chuck Hagel, R-Neb., that offers tax breaks to energy companies that voluntarily reduce greenhouse gas emissions.
But there is yet one more Senate bill — the Ratepayers Protection Act of 2005 — that would address global warming hysteria as the quintessential junk science phenomenon it is.
Some power companies, like Duke Energy and Cinergy, have embraced global warming-mania and are starting to take steps to address their carbon dioxide emissions, the costs of which will be passed on to ratepayers (consumers).
But the Ratepayers Protection Act (search), introduced by Sen. James Inhofe, R-Okla., would ensure that the costs associated with voluntary actions taken by utilities under the guise of global warming are not passed on to consumers.
“As the need for those reductions is not grounded in science, it is important that those costs are not passed on to electricity consumers,” stated the bill's media release. Sen. Inhofe's bill would rightly make utility shareholders, not consumers, responsible for footing the bill of corporate management folly concerning global warming.
While it's not likely that companies looking to profit from global warming alarmism will support the Ratepayer Protection Act, the rest of us should rally behind Sen. Inhofe rather than bear the costs of all this hot air scheming.
Steven Milloy publishes JunkScience.com and CSRwatch.com, is adjunct scholar at the Competitive Enterprise Institute, and is the author of Junk Science Judo: Self-defense Against Health Scares and Scams (Cato Institute, 2001).
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