“FERC Commissioner Tony Clark seems to be about the only person currently on record to see what’s coming…. In Commissioner Clark’s words, each state with an approved plan ‘will have entered a comprehensive “mother-may-I?” relationship with EPA that has never before existed’.”
If you’re an impressionable economist, the U.S. Environmental Protection Agency’s powerplant carbon abatement proposal looks like a winner. Different people have different costs of reducing emissions, and the draft rule proposes several alternative paths that a state might take in formulating its implementation plan. Flexibility allows a state (or possibly a group of them) to choose among direct limits on generator emissions, to implement policies that substitute renewables for coal, or to use a “portfolio” approach that includes increased end-use efficiency. Just get EPA to sign off on your compliance plan, adhere to it, and you’ll be part of America’s low-carbon future.…
Continue Reading“The chief reason BC is not an appropriate ‘model’ for the U.S. is that the province’s geology, climate, and electric supply system are dissimilar to those of most American states. BC’s peculiar electricity fuel mix sharply limits the damage that a $30/ton carbon tax can do to the province’s economy. Nearly all of BC’s base load electricity is zero-carbon hydropower…. Natural gas is the only part of BC’s electric supply system subject to the tax …. and generates less than 6% of BC’s electricity.”
To persuade Americans — especially conservatives and libertarians — that a carbon tax can “work” (reduce emissions) without harming the economy, some proponents tout British Columbia’s carbon tax, enacted in May 2008. How relevant is the British Columbia (BC) “model” to U.S. climate and tax policy debates?…
Continue ReadingWind energy development in the United States has slumped. Despite record installations in 2012, and eking out a 1-year, $12 billion extension [1] of the wind production tax credit (PTC), new wind capacity last year fell to just 1,087 megawatts, a level not seen in more than a decade. Development in 2014 is showing signs of improvement, but the year may not fare much better.
The industry blames Congress and the uncertainty surrounding the PTC for the slowdown. But such thinking is overly simplistic and ignores the fundamental challenges facing big wind. This slump, like others that plagued development in prior years, can be traced directly to generous government assistance, current energy prices, and the inherent limitations of wind power.
Slowdown Reasons
The Section 1603 cash grants enacted under ARRA fueled a wind bubble as developers raced to build and qualify their sites.…
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