The “Energy Efficiency Excise Tax”
In January 2007 newly elected Senate leader Peter Shumlin declared war on the Menace of Global Warming. Shumlin said that failure to act boldly to combat the Menace will make our grandchildren’s lives “unspeakably horrid”. The leading component of that war on the Vermont front was to have been the creation of a new “thermal efficiency utility”.
This new governmental bureaucracy was to parallel the electric efficiency utility, Efficiency Vermont, financed since 1999 by a tax on electric bills. Instead of (logically) taxing heating fuel, propane and natural gas, the utility would raise $25 million through a new tax on Vermont Yankee. This sum, Shumlin explained, would curtail waste, create jobs, and curb greenhouse gas emissions.
The 2007 legislature obligingly passed the thermal efficiency utility bill. But Gov. Jim Douglas, not sharing the Shumlin-VPIRG alarm at the Menace of Global Warming, vetoed it. The legislature let Shumlin’s signature issue drop for the moment.
But now the Shumlin administration has revived the thermal efficiency utility as the centerpiece of next year’s battle against the continuing Menace of Global Warming. The Public Service Department’s Thermal Efficiency Task Force has unveiled a comprehensive draft report proposing sweeping new programs to educate, persuade, regulate, subsidize, mandate and tax Vermonters into spending less money on heat.
It’s curious that the Shumlin administration is so determined to use all these tools to get Vermonters to spend less on heat, all the while declaiming against the very climatic effect – global warming – that, to the extent that it’s occurring, is allowing Vermonters to spend less on heat.
A leading concern of the Task Force is that present weatherization programs only serve lower-income people. Upper-income households can afford to invest in thermal efficiency, but what about middle income families, with 80-120% of median income? How can the state in good conscience fail to subsidize them too?
To close this subsidy gap the report proposes a wide range of programs and services. But of course this requires new money. The Task Force’s leading proposal for raising that money is a new “energy efficiency excise tax” on fuel oil, propane, kerosene and natural gas (but not biomass, since there’s no easy way for the state to tax your woodpile.)
The Task Force proposes that the state collect $260 million from this new tax over next seven years. The tax would be paid by businesses, schools, hospitals and state and local governments, of course, and by the seventy percent of Vermonters who heat their homes with fuel oil or propane.
Matt Cota, executive director of the Vermont Fuel Dealers Association, pointedly argues that “we should not use a regressive tax that hurts the lowest income Vermonters, in order to fund retrofits for the richest.” It’s likely that the legislature would have to include yet another new rebate program to alleviate yet another regressive tax burden.
Back in 2007 Sandra Levine of the Conservation Law Foundation said “for every dollar you invest in energy efficiency, you save two or three dollars [on energy] that you would have had to buy.” If so, the logical next step is for “you” to take charge and act.
But Gov. Shumlin, his Task Force, CLF, VPIRG and their Green friends in the legislature are determined that not “you”, but the government, must take charge of making everyone’s energy decisions – and send “you” the tax bill.
In a free society, people manage their finances in their own self-interest. Vermonters have been making energy efficiency investments at least since the 1973 oil shock suddenly raised their fuel oil and gasoline prices.
But in present-day Vermont, there are always voices clamoring to create new government programs to mandate and subsidize what government decides is the next “good thing” for everybody, and in this case extracting $260 million in new taxes over seven years to pay for it.
The Vermont Constitution states that “previous to any law being made to raise a tax, the purpose for which it is to be raised ought to appear evident to the Legislature to be of more service to community than the money would be if not collected.” The “energy efficiency excise tax” on your heating fuel bill fails that test.
Pirates of the Winooski
The highly popular Disney movie series Pirates of the Caribbean, starring the lovable rogue Captain Jack Sparrow, has captured the imagination of a new generation, as Errol Flynn and Burt Lancaster pirate movies did half a century ago.
In Montpelier a similar but less appealing series has been playing for the past several years. Its current lead character is the less lovable Captain Pete Shumlin. Now he and his crew are deeply engaged in a scheme to loot millions of dollars from the people of the state.
Captain Pete is far more devious than the earlier generation of swashbucklers. Instead of boarding treasure ships to take their chests of gold, Captain Pete has a penchant for relieving people of their money in ways that they are far less likely to notice.
Also, Captain Pete isn’t in the piracy game to enrich himself. He wants to collect the gold to underwrite the ventures of his favorite cause, the renewable industrial complex. But straightforwardly taking the money from people at sword point produces resistance. So Captain Pete has concocted all sorts of devices to relieve Vermonters of their money without letting them know what is being done to them.
For a decade Vermont’s Captain Petes focused their piratical urges on a non-voter, Entergy Nuclear. They extracted millions of dollars from the company in return for permission to produce more electricity, and to store spent fuel rods on its own property.
The prime beneficiary has been Captain Pete’s Clean Energy Development Fund. This body, created in 2005, was charged with passing out the revenues collected from Vermont Yankee to a variety of renewable energy projects, all in the name of making Vermont a world leader in combating the Menace of Global Warming. Notable among these are tax credits – later outright grants – to upscale homeowners who install expensive solar electric systems.
But with Vermont Yankee now free from further extortion by Captain Pete, the Fund will quickly run out of money to distribute. That would require the renewable energy purveyors to sell their products in a competitive market where, unsubsidized, they are simply not competitive.
Since most of the money raising schemes promoted by Captain Pete during his Senate leadership have fizzled out – the $150 surtax on the purchase of minivans, SUVs and pickup trucks, the “heating fuel savings charge”, the “unanticipated revenues” tax on nuclear electricity, and the cap and trade plan come to mind - the desperate search is on to find something, anything, to continue funding the CEDF.
Captain Pete’s mates in the legislature have ginned up one solution: force Vermont’s utilities to buy lots of renewable electricity at four times the market price (“renewable portfolio standard”), or pay the value of any carbon credits required to cover a shortfall into – yes! - the Clean Energy Development Fund. This is contained in Rep. Tony Klein’s H.468, now before the Senate.
But that’s complicated and uncertain. The ingenious Captain Pete has a better idea. In 2001 the Public Service Board allowed a struggling Central Vermont Public Service Company to raise its rates, but on the condition that if the company were sold, ratepayers would receive a rebate of (now) $21 million.
Now CVPS is being sold to Gaz Metro of Montreal, and will be merged with Green Mountain Power. Captain Pete and his Department of Public Service are the leading cheerleaders for this acquisition.
But Captain Pete doesn’t want Gaz to have to dribble out $21 million by “sending back small checks to people we can’t find”, and has denounced – no other verb seems adequate – “quibbling” over the matter. All those little ratepayers don’t need the money! The renewable industrial complex needs the money! Don’t quibble with Captain Pete!
This intricate – some might say underhanded – scheme was brilliantly explained by Rep. Oliver Olsen on vermonttiger.com (April 6). Concludes Olsen, “After forking over more money in our rates to pay for these [mandated renewable energy] investments, we get the ‘benefits’ and they [Gaz] keep the money… In effect, it’s a clever way of raising revenue to fund state programs that came up a little short in this year’s budget. In other words it’s a hidden tax.”
Of course it is. Worse yet, it’s a tax designed not to help the poor, sick and struggling. It’s a tax to benefit Captain Pete’s cronies who will wax fat while ratepayers forego the rebate and pay higher electric bills to boot.
Maybe someday someone will make a modern pirate movie about this misadventure, hopefully after all the parties to it have been (figuratively) keelhauled.
The Doleful Road to $6 Gas
Vermonters are alarmed at $4 gas, and terrified at the prospect of $5 or $6 gas to follow. That alarm has contributed mightily to the descent to 41% in President Obama’s job approval rating. The Obama Administration is thus working feverishly to transfer the responsibility to somebody – anybody – else.
The President argues that the prospect for an Iranian conflict causes speculators to drive up the price of crude oil on world commodity markets. That’s certainly true, but that’s far from all of the story.
The price of oil futures, like every other commodity, is based on forecasts of future oil demand and supply. In addition to the looming Iranian interruption, market participants – both oil refiners and speculators – look at many other factors, including government policies relating to supply.
In a January 2008 interview with the San Francisco Chronicle, candidate Obama explained his cap and trade plan to cut greenhouse gas emissions from carbon-based fuels. Under it, he admitted, “electricity costs would necessarily skyrocket.” And so would gasoline, diesel and heating oil prices, subjected to the same cap and trade regulations.
Once in office, Obama ‘s energy policies have clearly been based on the belief that humans, in our insatiable urge for the convenience and comfort made possible by inexpensive carbon-based energy, are propelling the planet toward Al Gore’s heat death.
Ever higher prices discourage energy consumption. Obama named as Secretary of Energy Steven Chu, who had then recently said “somehow we have to figure out how to boost the price of gasoline to the levels in Europe”, currently $8 a gallon. A month ago Chu informed a House committee that he was not working to lower gasoline prices, but to wean the US off of oil. With U.S. gas prices pushing $4 a gallon, Chu is now squirming to reinterpret those statements.
But Steven Chu’s statements don’t drive up gas prices. Policies designed to choke off petroleum production do.
The Obama administration, backed by the entire environmental movement, is dead set against allowing oil production from a 2200 acre tract –the size of tiny St. George, Vermont - of a desolate plain in the Arctic National Wildlife Refuge. Not only will the billions of gallons of oil stay in the ground, but the lack of oil production will eventually require shutting down the Alaska Pipeline.
The administration, again backed by the environmental movement, has been hostile to increased oil production in the Gulf and on the Outer Continental Shelf. Almost all of the welcome surge in natural gas production made possible by fracking technology has occurred on private land where the administration can’t stop it.
The Obama Environmental Protection Agency is also imposing Tier 3 gasoline standards that are predicted to increase gas prices by 25 cents a gallon. The Obama EPA refuses to recognize that at some point the claimed benefits of ever-cleaner gasoline can cause more economic damage then they are worth.
Under strong enviro pressure the President has, astonishingly, blocked the Keystone XL oil pipeline from crossing into the US from Canada. Denied a transit route to Texas refineries, the Canadians are about to build their own pipeline to convey the Alberta oil to their Pacific coast, for export to the Far East.
According to the environmental groups backing the Obama policies, the alternative fuel to gasoline is ethanol. But the Federal mandates and subsidies that caused the conversion of 40% of America’s corn crop into ethanol have also produced engine damage and higher food prices. Cellulosic ethanol has turned out to be an embarrassing bust.
Then there’s the electric car craze. When the Obama administration became the largest shareholder in General Motors, it pushed the company into marketing an electric car. The new Chevy Volt will reduce demand for gasoline by running 100% on electricity (so long as their batteries last.)
Despite a federal subsidy of $7,500 per car, GM announced last month that it was suspending Volt production after selling only 8,000 cars. The President is now proposing that the subsidy be increased to $10,000 to attract more buyers (with average household incomes of $170,000).
The current crown jewel in the President’s energy tiara is a new program to replace petroleum fuel with alcohol from algae. Sure, it could probably be done, with enormous federal subsidies. So could Newt Gingrich’s city on the moon.
Can we get real here? If Americans don’t want to face Steven Chu’s European gas prices any time soon, the President should forget about the dubious Menace of Global Warming, tell his appointees to back off ever more subsidies and mandates, and let American industry produce the energy the American people need, at prices they can afford.
Federal Judge Strikes Down Legislative Extortion Ploy
On January 20 Federal District Judge J. Garvan Murtha ruled that federal law preempts the state from regulating the Vermont Yankee nuclear power plant over safety concerns.
Well down in the media reports it was mentioned that the judge also found that the interstate commerce clause of the U.S Constitution precludes the state from conditioning Vermont Yankee’s continued operation on Entergy offering below market power prices to Vermont’s utilities. What the news accounts did not do was explain how Judge Murtha reached that second conclusion. It’s not a pretty story.
Beginning on page 91 of the court’s 102 page decision, the Judge quoted verbatim a February 9, 2009 letter to Entergy from then-Senate leader Peter Shumlin and House Speaker Shap Smith. The two lawmakers stated that “It was our expectation that a power purchase agreement would be reached between the negotiating parties no later than December, 2008 and in advance of the legislature convening for the 2009 session.”
The Shumlin-Smith letter continued that the General Assembly intended to consider “the terms of such a contract,” including “its length, the price to be paid for electricity products under the contract, and an analysis of its costs and benefits to our constituents.”
The letter concluded: “Accordingly, if [Entergy is] unable by Wednesday, February 18, 2009, to provide the General Assembly with a power purchase agreement between the parties, it will be nearly impossible for the legislature to make a judgment on the continued operation of the plant before we adjourn in May, 2009.”
After that adjournment Shumlin and Smith again wrote to Entergy’s Jay Thayer, stating that “it will be exceedingly difficult for the Vermont General Assembly to act in 2010 on the question of continued operation of the Vermont Yankee Nuclear Power Station unless a power purchase agreement between Vermont utilities and Entergy is filed with the Vermont Public Service Board before November 1, 2009.”
The letter noted that state officials “established this firm deadline” to permit review “by the Public Service Board and then by the Vermont General Assembly.” Furthermore, the “contract and its details are critical to the central issues of economic [sic] relative to the Vermont Yankee nuclear plant that the legislature must consider.”
Here, the judge stated, “there is evidence Vermont Yankee would be required to sell a portion of its output to Vermont utilities at below-market rates, rates that would not otherwise be available to the utilities if they were negotiating on the same footing as customers in other states, or the plant must suffer the consequences of closure. The New England Power decision makes clear that a state’s requirement that a wholesale plant satisfy local demands and provide its residents an ‘economic benefit’ not available to customers in other states runs afoul of the Commerce Clause, because it impermissibly burdens interstate commerce.”
He concluded, “this Court will permanently enjoin Defendants [Gov. Shumlin and the PSB] from conditioning Vermont Yankee’s continued operation on the existence of a below-market Power Purchase Agreement with Vermont utilities.”
What are we to make of this? First, Judge Murtha is describing an unmistakable political shakedown. The 2006 law interjected an unique legislative approval requirement before the applicant (Entergy) could obtain a final order from the Public Service Board to continue plant operation. Unlike the PSB, whose non-political decisions are guided by volumes of statute and case law, Act 160 allowed legislators to vote Vermont Yankee off the island for any reason, or no reason.
Shumlin and Smith made it clear that their price for allowing the PSB to rule on Entergy’s application was below-market power contracts. To put it in bold relief, this is only a little different from a Chicago ward boss demanding payment from a contractor seeking a building permit.
That leads to the second point. By using their political muscle to force Entergy to give them a political benefit – lower power costs – the two politicians cast a dark shadow over Vermont’s hitherto nearly spotless record of equality before the law and probity in public service.
Vermont is still ethically far removed from Chicago, but the judicially-rejected Shumlin-Smith extortion attempt can only damage Vermont’s attractiveness as a place to engage in productive economic activity. This state has enough obstacles to job-creating economic growth without adding that one on top.
Unicorn Power for Vermont!
Four years ago the VPIRG plan for the Extreme Green Makeover suffered a severe setback when Gov. Jim Douglas vetoed Sen. Peter Shumlin’s bill to levy a $25 million tax on the state’s leading generator of clean electricity, Vermont Yankee, to fund a new state entity to go about persuading Vermonters to stop wasting money on heating fuels.
The Democratic legislature failed to override the veto, but the Senator from VPIRG vowed to come back with an even more far reaching Green plan in 2008. And he did.
Shumlin’s S.350 of 2008 proposed creation of a climate supergovernment to mastermind what has been called a Manhattan Project for Green Social Engineering. It also featured strict “smart growth” land use control strategies, cap-and-trade control of greenhouse gas emissions, , new Act 250 rules to impose “carbon neutrality” on developments, mandates for the protection of “dead and dying wildlife trees”, doubling (heavily subsidized) passenger rail traffic by 2028, getting all single-occupancy vehicles off the highways, steeply increased vehicle sales and use taxes and registration fees on low-mpg vehicles, energy efficiency standards that must be met before homeowners could sell their houses, and biofueled bus tours to visit biofuel producing farms.
Happily, cooler heads prevailed, and the bill was reduced before passage to report making and a continuation of various working groups.
But now Peter Shumlin is Governor. Together with his Climate Cabinet, he has in place the supergovernment envisioned in 2008. He has enthusiastically adopted the ambitious plan of his Department of Public Service to make Vermonters get 90% of their energy from renewable sources by 2050.
His administration is committed to forcing ratepayers to subsidize a vast increase in renewable energy. That is largely because it needs some new power sources to replace Vermont Yankee’s 280 Mw of dependable low cost base load electricity.
Shumlin’s key legislative allies of 2008 have now introduced bills (S.170 by Sen. Ginny Lyons, H. 468 by Rep. Tony Klein) to move more quickly in the direction of the bill he championed back then.
The main feature of both bills is adoption of a “Renewable Portfolio Standard”, whereby Vermont’s utilities will be required to buy ever more electricity from “renewable” sources, regardless of price.
Under current law, the Clean Energy Development Fund subsidizes favored renewable energy producers. The state also mandates that the utilities make a “standard offer” to buy up to 50 Mw of in-state renewable energy (wind, solar, landfill and farm methane, biomass) at prices ranging from three to four times the market price.
The Lyons bill doubles the standard offer to 100 Mw, and levies a 3 cents/kwhr penalty tax on utilities that fail to meet the fiendishly complex requirements of the new Renewable Portfolio Standard (their ratepayers will pay it, of course.) The tax proceeds will go directly into the Clean Energy Development Fund, now almost out of money since the Vermont Yankee cash cow will stop making forced contributions in March.
What a sweet strategy! Extinguish the low-cost competition (Vermont Yankee) to drive electricity prices higher, then subsidize favored renewable energy producers, then mandate that utilities buy their product at far above market prices, and send the bill to their captive ratepayers!
The Lyons bill dropped the gas guzzler tax of the earlier Shumlin bill, but found suitable replacements in the requirement that every residence in the state obtain its hot water from solar collectors 13 years from now, plus a 5% “fossil heating fuel efficiency tax” to make heating oil, propane and natural gas more expensive. This new tax will take effect two months after the 2012 election.
Another feature of the reborn 2008 Shumlin bill is the all-out taxpayer financed “climate change educational campaign”, also known as the “Green Madrassah”, through which the next generation of Vermonters will be thoroughly indoctrinated in Al Gore and Bill McKibben’s apocalyptic climate theology. This is designed to reduce resistance to the increasingly desperate tax and regulatory schemes that will likely be needed to push Vermont to the goal of 90% of energy from renewables by 2050.
One recent blog comment on the Shumlin energy plan hit the mark: “These people believe they can power the state on the combustion of unicorn flatulence.” One might note that the collectors and sellers of unicorn flatulence will make out handsomely in the process, while Vermont’s energy consumers take a hell of a beating.
A Pro-Growth State Energy Plan
The guiding principle of the Shumlin administration's draft Comprehensive Energy Plan is "to set Vermont on a path to attain 90% of its energy from renewable sources by 2050."
The plan also advocates for moving toward "energy independence" by requiring Vermonters to reduce their consumption of imported fossil fuels that now comprise two thirds of the state's total energy consumption. It also supports reducing greenhouse gas emissions to 25% below 1990 levels by 2012, and 50% below by 2050, to "lower the state's contribution to global warming."
The most startling omission in this voluminous plan is the absence of any chart or graph showing the sources of Vermont's electrical energy now, and the sources we can expect to enjoy in future decades if the Plan's recommendations are acted upon.
Vermont now obtains 33 percent of its electrical consumption (GWhrs) from Vermont Yankee. If that safe, reliable base load plant is closed down in March 2012 - as Governor Shumlin directed this Plan to assume - one-third of our electricity supply will disappear. How then will this be made up?
In particular, what level of rate-payer and taxpayer subsidies - tax credits, rebates, government financing, mandates, Feed In Tariffs, Renewable Portfolio Standards, and outright capital subsidies - will be required to achieve the required efficiency, and attract this amount of renewable electricity into the market?
How many acres of solar panels? How many more 450 foot wind turbines? How many gas-fired backup plants to keep grid load reasonably level? Will the resulting price of that electricity keep Vermont businesses competitive and residences affordable? This information is not included in the Plan.
In short, the Plan's vision of a state with 90% of its total energy produced by renewables by 2050 can only be achieved by heroic, costly government intervention into the energy market, over the growing protests of taxpayers and rate-payers called upon to finance the ever-expanding renewable industrial complex.
There are some useful proposals in the Plan, but overall the Plan resolutely heads off in the wrong direction. It anticipates enormous taxpayer and rate-payer costs, ever-growing bureaucracies, and ever more extensive controls over the choices of the ordinary Vermonter, all to send Vermonters galloping after a wrong-headed goal of "90% renewable energy by 2050".
The Ethan Allen Institute submitted twenty recommendations for a realistic energy plan. The first is to abandon the "vision" of this Plant hat requires state government to use its coercive powers to see that Vermont gets 90% of its energy from renewable sources by 2050 or any other date.
Instead, the state should adopt a vision like this: "to set Vermont on a path to assure safe, reliable and competitively priced energy that will make possible a strong, competitive and growing economic base, both for creation of new wealth and income for the people of the state, and for expanded tax revenues to enable the state to meet its fiscal obligations."
In addition, the legislature should repeal the requirement that Vermonters be forced to reduce their greenhouse gas emissions to 50% below the 1990 baseline by 2050, or any other year, and also the state's "climate action plan", inasmuch as nothing the people of Vermont can do, even at crippling economic cost, will ever have any detectable effect on any metric of climate change (formerly "global warming").
While they're at it, they should repeal the SPEED and Feed In Tariff requirements; abolish the Clean Energy Development Fund; repeal the rate-payer-financed PSB energy efficiency program; abandon consideration of Renewable Portfolio Standards for Vermont utilities; and review all existing energy regulatory schemes to remove barriers to creative energy innovations by a free people.
Legislators, bureaucrats and Governor need to consistently remind themselves that markets work, and that ordinary people usually turn out to make better use of their resources than what is prescribed for them by the experts who prepare "comprehensive energy plans."
The New Climate Change High Command
Three years ago Senate President Peter Shumlin was the lead sponsor of a bill, ardently promoted by the Vermont Public Interest Research Group, to "make global warming the top priority of everything we do, not only in government, but in our own personal and private lives." Shumlin's conviction to this peculiar notion is so intense that he later declared that "any other conclusion is simply irresponsible." (So much for reasoned debate.)
Now, as Governor, having set Vermont state government off on the road to raising $3 billion in new taxes to pay for single payer health care, Peter Shumlin is again turning to the his top priority of 2008. (The advocates now describe the issue as "climate change", because Mother Nature dropped the ball on "global warming".)
On May 17 the governor announced establishment of the Vermont Climate Cabinet, composed of nine state officials appointed by Gov. Shumlin. The new body, chaired by ANR Secretary Deb Markowitz, will seek to ensure that "Vermont continues to be a national leader [in addressing] the challenge of climate change."
The new Cabinet's primary duty is to "leverage interconnectedness" by coordinating climate change efforts across all state agencies and departments. It will also tend to a long list of informing, strategizing, partnering, promoting, propagandizing, fostering, advising, and of course, looking for federal funding for "climate change mitigation.”
To get some idea of what the nine Shumlin appointees are likely to recommend, it's worth looking back to the original Shumlin bill of 2008, S. 350. That bill actually passed (Act 209), but only after the House, to the intense disappointment of VPIRG and presumably its lead sponsor, had pulled almost all of its teeth.
S.350 proposed to create VPIRG's heart's desire, a climate super-government with duties equivalent to those of the new Shumlin Climate Cabinet, but with a broader composition. That "climate cooperative" of 2008 would have been charged with supervising a bewildering array of task forces and working groups to produce a host of reports advocating new regulations, controls, mandates, plans, rules, standards, taxes and subsidies.
The bill would also have mandated - and enforced compliance with - a statewide greenhouse gas emission inventory and a state cap and trade program. This latter scheme would require emitters of the dreaded greenhouse gases in excess of a state-determined cap to buy emission tickets from other emitters operating under the cap. The bill prescribed gas guzzler taxes on vans, SUVs, and pickups to finance subsidies for $41,000 electric cars. These provisions were dropped from the bill that was enacted.
Other complementary proposals either adopted or considered in the past few years are the Clean Energy Development Fund (to be funded by a new tax on electric bills); a Renewable Portfolio Standard, to require utilities to buy electricity from favored producers; a feed-in tariff, to require utilities to pay as much as five times the market price for renewable electricity; and tax benefits for people who install renewable energy systems. Act 168, enacted in 2006, actually declared a state goal of reducing of greenhouse gas emissions to an unimaginable 50% below 1990 levels.
Also urged are new subsidies for commuter rail (after the state threw away $28 million on Howard Dean's now-defunct Champlain Flyer); the Shumlin "thermal efficiency utility" to subsidize businesses to save money on heating fuel; an ever-increasing electricity tax (now at $40 million, on its way toward the $81 million demanded by VPIRG) to expand Efficiency Vermont's services to more needy people like Green Mountain Coffee Roasters; a carbon tax; stringent building codes to reduce carbon footprints; and Act 250 amendments to put a stop to developments beyond walking distance of work, store and post office.
Now let's be clear: it makes good sense for families, businesses, and governments to take cost-effective measures to reduce wasteful energy consumption. It makes good sense for vehicle buyers to consider the tradeoffs among speed, weight, power, safety, and fuel consumption. It may make good sense to install a renewable energy system where sun, wind, wood and water are favorable. Free people make those decisions all the time.
What makes no sense at all is this infatuation with the increasingly untenable notion that human-caused greenhouse gas emissions produce any detectable effect on the Earth's climate - or that any conceivable collection of Big Brother regulations, taxes, mandates, and subsidies could achieve anything besides turning Vermont into an even less free and more taxed enclave of bureaucracy, servility, and economic stagnation.
Shumlin’s Vermont Yankee Coercion Scheme
Entergy, the owner of the Vermont Yankee nuclear plant, and the state are now locked in judicial combat in Federal court.
In 2002, when buying Vermont Yankee from its utility owners, Entergy agreed that it would seek a new Certificate of Public Good from the Public Service Board if it sought federal approval to continue to produce power after the plant’s license expiration date (March21, 2012.) It also agreed not to attempt to bypass PSB jurisdiction by invoking Federal preemption – the doctrine that a state cannot regulate federally-licensed economic activity serving an interstate market in a way that contravenes Federal regulatory authority.
Four years after this agreement, the Vermont general assembly passed a bill (Act 160), opposed by Entergy, that required general assembly approval before the PSB could issue a final order on Entergy’s application for a new certificate. This March Entergy received an extended 20 year license to continue producing power from Vermont Yankee, but Vermont’s legislative leadership refused even a vote on approving Yankee’s continued operation.
So Entergy went to Federal court seeking a declaratory judgment that by approving Yankee’s continued operation for twenty years, the Federal government has preempted state regulation of nuclear plant operation. It also asks the Court to find that the legislature’s political interposition, ardently supported by Senator and now Governor Peter Shumlin, constitutes a deliberate scheme to extract money from Entergy for the benefit of Vermont utilities and ratepayers.
On the first point, Attorney General Sorrell, defending the state, holds up a 1983 Supreme Court case, PG&E v. State. In that case a California statute required legislative approval of a proposed but unbuilt nuclear plant, based on the applicant’s satisfying a state commission that spent fuel rods would be acceptably handled. The Court upheld the statute.
But in doing so, the Court held that “ the statute does not seek to regulate the construction or operation of a nuclear power plant.” Clearly the Vermont statute seeks to completely deny the operation of an existing nuclear power plant that has given Vermont businesses, farms, and homeowners low cost baseload electricity for 39 years. Furthermore, since the plant is a merchant generator, no longer owned by Vermont utilities, the traditional concerns of state regulators no longer apply.
Of particular interest is Entergy’s charge of political coercion. From the brief:
“Vermont officials have further stated that they might condition any favorable exercise of the state’s supposed licensing authority upon the wholesale sale of power generated by the Vermont Yankee Station to Vermont retail utilities at preferential rates compared to the rates charged by non-Vermont retail utilities.”
“This condition coerces Plaintiff [Entergy] to enter into below market power purchase agreements with Vermont’s retail utilities that will effectively result in [Vermont Yankee] and out of state consumers subsidizing the electric bills of Vermont’s consumers.”
The brief supports that charge with several Shumlin statements, such as this one in January 2009, when he was Senate President: “There’s no way we’re going to vote to relicense the plant unless Vermonters are getting a great deal.”
The Court may well reach a conclusion favorable to Entergy’s preemption claim. If it does so, the Court may not choose to consider Entergy’s claim that Act 160’s political coercion of electricity generators violates the Federal Power Act. But Vermonters need to take a hard, clear look at the game that certain politicians, notably Peter Shumlin, have been playing.
That game comes down to a political ultimatum to Entergy: “unless you agree to sell power to Vermont utilities at a sufficiently below-market price, we’ll block you from obtaining the certificate you need to stay in business in this state.”
This practice of selling valuable government permission has the rotten smell of every political machine from Tammany Hall to Boss Tweed to modern day Chicago to any number of today’s despotic Third World regimes. As the brief argues, the statements of Peter Shumlin and the general assembly’s politicization of the regulatory process have “irremediably tainted” the authority that Shumlin and Sorrell claim the state has to shut down Vermont Yankee.
Moreover, the growing perception that the politicians now leading Vermont are practicing extortion – for their political advantage, if not for personal under the table payments – can only become an “irremediable taint” on the integrity of our state, and an increasingly troublesome obstacle to Vermont’s future economic prospects.
A Better Idea for Renewable Energy
The long running saga of Vermont’s “Clean Energy” subsidies took another interesting turn last week, featuring the duo who gave us last summer’s distasteful rent seeking exhibition, Peter Shumlin and David Blittersdorf.
Then, it will be recalled, the Clean Energy Development Fund was preparing to hand out tax credit subsidies to wind and solar electricity projects. The available credits came from $12 million extorted from Entergy as the 2005 legislature’s price for allowing Vermont Yankee to store spent fuel rods on its own property at its own expense, over the six years that remained to the nuclear plant before the 2011 legislature voted it off the island forever.
Actually, Vermont Yankee is now being non-voted off the island, since the leadership of the present legislature refuses to risk a recorded vote that might come back to haunt some anti-nuclear legislators when their constituents examine their electric bills in the months just before the 2012 election.
Then-Sen. Shumlin had named entrepreneur David Blittersdorf to the board of the Clean Energy Development Fund. There was some logic to this, since Shumlin had earned the nickname “senator from VPIRG”, Blittersdorf had been a major VPIRG fundraiser, and VPIRG had aggressively lobbied for ever more renewable energy subsidies.
As a Board member, Blittersdorf was in a position to influence the awards process to favor enterprises linked to his company. When that became apparent, the CEDF chairman asked Blittersdorf to leave the room when the awards policy was under discussion. Taking note of the potential conflict of interest , Shumlin asked Blittersdorf to resign from the Board.
Blittersdorf did so, but only after voting to direct the executive director to set the preference policy for tax credit awards. That official promptly established the first come, first served policy that favored Blittersdorf’s enterprises. Two months later CEDF announced the award of $4.3 million in tax credits to those enterprises.
Now the Clean Energy Development Fund is running out of money. With Vermont Yankee scheduled to go out of business in March 2012, it can’t be made to pay millions more when it will no longer have the revenues earned by selling Vermont’s lowest cost baseload power to the state’s utilities.
To the Fund’s rescue came Rep. Tony Klein, the very green chair of the House Natural Resources and Energy Committee. On April 5 he brought out a bill to replenish the dwindling CEDF subsidy coffers. It proposed to levy a regressive 55 cents a month tax on everybody’s power bills. The Republicans protested. No matter. The Klein plan handily advanced to third reading.
But then the media asked now-Gov. Shumlin if the Klein electric poll tax violated his campaign pledge not to increase broad based taxes. Ouch! Shumlin quickly reversed course. He told his legislative friends to scrub the 55 cent a month tax, and declared that he would come up with a better plan shortly. So the House that voted 99-39 for the new tax on Tuesday, enthusiastically voted 134-0 to delete it on Wednesday.
Five days later Shumlin unveiled his new plan. Instead of the CEDF making annual payments over five years to successful subsidy seekers, he proposed that it offer them half the amount of their credits on Day One. The other half would then be available for the Fund to hand out in later years. This would replenish the Fund and make the Klein tax unnecessary.
Who thought this up? Shumlin’s friend and former CEDF board member David Blittersdorf. And what’s the advantage to the Blittersdorf-linked clean energy credit applicants? They can’t get private financing for their installations, because commercial lenders rightly think that projects so heavily dependent on deep subsidies are not creditworthy investments. To most applicants, getting even as little as half of the subsidy value as a grant up front, instead of tax credits that may not turn out to be useful in the future, looks like a bird in the hand.
Rep. Patti Komline has reported that of the 68 (of 92) approved tax credit applicants responding to a query, four preferred the tax credit and 64 wanted the upfront grant. Of those 64, 62 are Blittersdorf's projects.
There’s a far better path out of this ever more complicated politically infected subsidy swamp. Forget taxing everybody’s electric bills, scrap the Clean Energy Development Fund, approve twenty more years of low cost nuclear electricity from Vermont Yankee, and let David Blittersdorf’s upscale customers pay for their boutique energy investments out of their own pockets.
End Game for Vermont Yankee
Three months from now Entergy Nuclear Vermont Yankee (VY) will be forced to make a fateful decision: whether to give in to the furious anti-nuclear campaign led for years by Vermont’s anti-nuclear new Governor, and abandon a safe, reliable, low-cost, nuclear plant that generates about a third of Vermont’s electrical consumption.
VY’s federal operating license expires in March 2012. In 2006 the company applied to the Nuclear Regulatory Commission for a twenty year license extension. Slowed to a crawl by the torrent of regulatory interventions by anti-nuclear groups, the NRC has yet to release its recommendations for extension. But based on its approval of extensions for dozens of similar plants, there is little doubt but what it will give VY a green light.
Anticipating that, the 2006 legislature passed a law unique among the fifty states. It declared that the Public Service Board cannot take any final action to authorize continued operation of nuclear plant without an affirmative vote of both houses of the legislature.
It is now clear that the legislative leadership – Speaker Shap Smith and Senate president pro tem John Campbell – have absolutely no intention of allowing a resolution of approval to come to a vote. That resolution would likely be voted down, but not allowing anyone to vote on it will shield the anti-nuclear legislators from having to answer to their voters for the likely consequences of a shutdown.
Those consequences are potentially grave. VY produces 620 Mw of baseload power. It’s currently the lowest cost 24/7 power purchased by Vermont utilities. IBM, with its $35 million annual electricity bill, is deeply concerned that without VY, its power costs will rise by as much as 30%. That concern is shared by other manufacturers, hospitals, colleges, local governments, and ski areas.
Opponents argue that VY’s capacity is only 2% of the total New England power grid, and will scarcely be missed. What they don’t want to discuss is that the loss of regional generation requires finding replacement power from distant sources. That creates grid stability problems and possibly construction of expensive new transmission lines to move the power into the region.
The anti-nuclear activists’ pipe dream of wind turbines and solar PV notwithstanding, the replacement power will largely come from coal and gas fired plants - just the kind of plants that enviros staunchly oppose because they release the carbon dioxide that they believe leads to the dreaded “climate change”.
Suppose the legislature sneaks out of Montpelier in May without voting to allow VY to seek PSB approval for its continued operation. Then what?
VY operates with an 18 month fuel cycle. After 18 months online, the plant is shut down, the reactor head pulled, the spent fuel moved to a cooling pool, a new fuel load put in, the head put back on, and the plant starts a new power run. The next scheduled refueling falls in or around November.
When a refueling shutdown takes place, a new fuel load must be on site. The lead time for purchasing fuel assemblies is about five months. So VY will have to place its order in June.
But by the time the refueling is completed, the plant would have only three months to live. What company is going to spend millions of dollars on 18 months’ worth of new fuel, when thanks to anti-nuclear politicians the plant would have only three months of operation left?
Unless the legislature turns around on this issue by May, and the PSB (as widely expected) issues a Certificate of Public Good by June, Entergy is almost certainly going to have to abandon VY.
The only uncertainty has to do with a possible Entergy appeal to Federal courts to invalidate the 2006 statute. It’s not clear just what legal argument Entergy might advance to get Federal courts to overturn the 2006 statute, but the litigation might well continue long enough for VY, with a stay of execution, to run through another fuel cycle to mid-2013.
If VY is forced to shut down next March, the New England grid operators may find some way to replace VY power, though at a significantly higher price. Perhaps more seriously, what business would be willing to locate or expand in a state where a legislature, answering to the demands of anti-nuclear activists, insisted on shutting down a safe, reliable, low cost source of electricity, vital to the state’s economic future?
The Coming Shumlin Green Police State
Gov. Peter Shumlin laid down a little noticed but important policy marker in his inaugural address. After a highly questionable recitation of the alleged magnitude of environmental change, he went on to say: “While leaders across America, influenced by the extraordinary economic power of oil, coal, and automobile companies, equivocate about climate change. We must not. That our planet is warming at an alarming rate is undeniable.”
Whether or not a global average increase of one degree F over the next century – most of it at high altitudes and latitudes - is “alarming” is a matter of one’s sensitivity to very small changes. Clearly it alarms Gov. Shumlin, though, and he wants it to alarm us. Because once we are alarmed, we’ll be much more likely to buy into his ambitious agenda to make Vermont the world’s leader in reversing greenhouse gas emissions.
This, he appears to seriously believe, will bring renown to little Vermont (and its governor). It will make this state a magnet for all sorts of green enterprises, which will locate here, import productive families with children, and provide a much needed (by him) rationale for expanding our public school system to save the jobs of VT-NEA teachers with an average of 12 pupils in their classrooms.
So Vermonters will certainly hear again from the new Governor: The planet is racing toward Al Gore’s Heat Death! Desperate big-government “solutions” must be implemented! Here! Now!
That agenda, introduced and promoted by Sen. Shumlin in 2008, calls for an energy super-government, the “climate collaborative”, to “coordinate statewide activities on climate change and all related energy activities.”
This unprecedented nine-member public body would supervise a bewildering array of task forces and working groups to produce a host of reports advocating new regulations, controls, mandates, plans, rules, standards, taxes, and subsidies. Among them:
- strict “smart growth” land use control strategies,
- mandated universal registration of greenhouse gas emissions,
- a state managed “cap and trade” scheme covering CO2 emissions
- aggressive implementation of Act 200’s planning mandates,
- new Act 250 rules to impose “carbon neutrality” on developments,
- doubling (heavily subsidized) passenger rail traffic by 2028,
- getting single-occupancy vehicles off the highways,
- steeply increased sales and use taxes and registration fees on low-mpg vehicles,
- energy efficiency standards that homeowners must meet before selling their homes.
Add to this other Shumlin favorites – the thermal efficiency utility funded by new heating fuel taxes, subsidies to the makers and users of approved renewable energy, and mandates on the utilities to buy “renewable” electricity at four times the market price – and you have a detailed blueprint for the Extreme Green Police State.
Some might not agree, so the proposed collaborative would also develop a indoctrination program: a “public education and engagement framework to encourage behavior change”, through “social marketing strategies with broad ethical goal.” An example: “in-depth, science-based in-school programs on energy efficiency and climate change at all level.”
Fortunately, in 2008, cooler heads prevailed. Most of the truly costly and dangerous provisions of the VPIRG agenda, including the super-government, shrank to relative insignificance in the House.
The collaborative was to have been funded through the inexhaustible General Fund. But since the General Fund now faces a $150 million deficit that nobody has yet explained how to cover, that seems problematic.
And if Gov. Shumlin and VPIRG achieve their heart’s desire of shutting down Vermont Yankee, that favorite Shumlin target of extortion won’t be generating any more revenues after 2012. So it’s a good question what combination of mandated business spending, forced purchases, hidden taxes, and “fees” Gov. Shumlin can cobble together to finance this veritable Manhattan Project of Green Social Engineering.
Vermonters need to grasp the fact that after eight years of Gov. Jim Douglas agreeing in principle with most of the Green arguments, but leaning against action steps that would undermine the economy, jack up tax rates, and invade people’s liberties, they now have a governor eager to lead us out of the slough of inactivity.
The only countervailing force is the people of Vermont. They need to say, loudly, that efficiency is good, cost-effective renewable energy is good, but the VPIRG-style Green Police State is a threat to our prosperity and liberties, and the legislators who vote for any more of this stuff will pay for it dearly two years hence.
The Renewable Industrial Complex
In the past month Vermont newspapers have published several banner headline stories that lifted the veil on the activities of the Clean Energy Development Board. Here’s some useful background.
For years Sen. Peter Shumlin’s main political cause has been banishing the Vermont Yankee nuclear plant from the state. In 2006 the legislature gave itself the power to prevent the Public Service Board from considering an extension of the plant’s “certificate of public good” to operate beyond 2012. Under that act, Senate President Shumlin engineered a Senate vote last February to in effect shut down Vermont Yankee.
It’s politically awkward to clamor for the shutdown of a clean, safe, reliable low-cost nuclear plant without explaining how to fill the hole caused by the loss of its 600 Megawatts of base load power. The first answer is conservation: persuade people to consume less electricity. Beginning in 1999 all ratepayers have been explicitly taxed on their electric bills to finance a state “energy efficiency utility” to subsidize selected ratepayers (for instance, Green Mountain Coffee Roasters) to get them to conserve electricity.
But that’s not enough. This strategy requires lots – some would say a staggering amount – of renewable electricity from wind, solar, hydro, and methane produced by cattle and landfills. This electricity costs much more to produce than power from Vermont Yankee or the New England power grid, which includes coal and gas fired plants. How to make people enthusiastic about paying lots more for electricity? Not a problem. Make their competition more expensive.
Senator Shumlin and his allies at VPIRG raised the Menace of Global Warming, to justify raising the costs of fossil fuel energy. They determined to get rid of the nuclear plant altogether (even though it emits almost none of the feared greenhouse gases.) Until that can happen, in 2012, they imposed all sorts of new taxes on the owner of the plant. The $28 million thus extorted was assigned to a new Clean Energy Development Fund. It would then distribute grants and tax credits to renewable energy producers, without which nobody would buy their high priced and unreliable electricity.
Shumlin named to the board David Blittersdorf, founder of NRG Systems and a leading advocate for renewable electricity produced by his company’s customers. The board hired the executive director of the renewable energy business association to manage the distributions to producers. Any notion that the funds distributed by the board should benefit ordinary ratepayers was explicitly repealed in 2009.
But just subsidizing renewable energy producers isn’t enough. The electrical utilities must be required to buy the high-priced electricity they generate. Thus Shumlin twice pushed through strengthening amendments to the SPEED program, that essentially requires the electric utilities to meet their demand growth by buying renewable energy. On top of that, the Shumlin-backed “feed in tariff” provision instructs the Public Service Board to tell the utilities how much they must pay for this power that they would otherwise not buy: 20 c/kwhr for wind and 30 c/kwhr for solar photovoltaic.
A crowning step would be enactment of a cap-and-trade system to tax fossil fuel users and use the proceeds to subsidize the producers and purchasers of renewable electricity. This, however, came up short in the 2009 session. Still to come, promised by candidate Shumlin, is the issuance of “renewable energy bonds” to further feed the industry.
So here it is in a nutshell. Shut down the nuclear plant. Impose higher costs on fossil fuel electricity. Hand out grants and tax credits to subsidize producers to produce higher priced renewable energy. Require the utilities to buy that energy at prices up to six times that of nuclear electricity. If this isn’t enough, have the state borrow to keep the game going.
Since Shumlin is running for governor, the fact that Shumlin’s appointee Blittersdorf sat on a board that handed out subsidies that advanced Blittersdorf’s business interests put the story on page one. To his credit, Shumlin asked Blittersdorf to resign from the board. Blittersdorf eventually did so, after having approved a tax credit distribution policy that later handed out $4.3 million in valuable tax credits to solar PV generators economically linked to his own businesses.
Shumlin, Blittersdorf, VPIRG and their allies have promoted a remarkable combination of junk science, polar bear hysteria, nuclear phobia, business mandates, hidden taxes, price fixing, corporate welfare, government debt, and subsidy handouts to benefit – well, mainly themselves.
If you wonder why Vermont is so often viewed as a state afflicted with all sorts of government interventions to promote politically correct liberal enthusiasms – and thus unfriendly to the workings of a normal market economy – look no further.
Saving the Planet Through Higher Taxes
“Our planet’s destruction” could be the consequence of Congress’s failing to pass a sweeping energy tax, carbon regulation, and subsidy cornucopia bill this session, according to Senate leader Harry Reid.
The House has already passed the Waxman-Markey bill with all these features. In May Senate Democrats unveiled their version, called Kerry-Lieberman. Both sound a shrill alarm about greenhouse gas “pollution” and the Menace of Global Warming, but that increasingly derided term has now been replaced by “climate change”, after Mother Earth refused to validate the UN’s bogus computer models.
Both bills authorize the government to force Americans to reduce their carbon dioxide emissions by 17% (of 2005 emissions) by 2020, and by 83% by 2050.
Both bills feature new hidden taxes on electricity and products produced from the combustion of coal, natural gas, and oil. This mechanism was formerly called “cap and trade”, but when the public figured out that this meant “cap and tax”, the sponsors retreated to using more obscure phrases such as distributing “allowance values”.
However the sponsors disguise their energy tax scheme, when you flip on the lights, heat your home, or drive to work, you’ll be paying – dearly – to help this left wing Congress deal with this imaginary problem.
Perhaps a case could be made for it, if there were an observable menace of human-caused global warming, and if the proposed energy tax measures were actually likely to flatten out a global temperature curve before the planet suffers destruction. But there is no observable human-caused “climate change”, and no likelihood that the cap and trade scheme would produce any significant positive climate effect even if there were.
The proposed legislation will, however, extract trillions of dollars in energy taxes, collected first from utilities, industries, and carbon fuel suppliers, but ultimately paid for by consumers of energy. For example, reaching that 2020 emissions level would require gasoline taxed to sell at more than $7 a gallon, according to a Harvard Belfer Center study.
The Kerry-Lieberman bill attempts to deal with this unpleasant effect by requiring utilities and industries to buy carbon dioxide emission allowances – thus raising energy prices – and then giving them free allowances to offset a claimed two-thirds of the government-created costs of the allowances they are required to buy.
It also offers refundable tax credits and direct handouts to low-income families and some social security recipients. If you qualify, that will ease the pain of the Kerry-Lieberman taxes. If you’re not in those categories, you’ll get the full dose with no anesthetic for the first 13 years. After that, you might get a Universal Trust Refund handout, assuming Congress has by then solved the deficit problem, rescued Social Security and Medicare, and has no further use for the extra money. You might also have won PowerBall by then.
A notable feature of both bills is the host of new subsidies included to buy the support of big business. Leading the corporate welfare parade is the nuclear industry, which would get more loan and insurance guarantees. The bill gives the gasoline and jet fuel industry a partial escape hatch, called a “linked fee”, that would limit the threat to them from a rising carbon allowance market.
The renewable energy and vehicle industries would get new billions in subsidies, which accounts for support from Al Gore’s venture capital firm and General Electric. As the Wall Street Journal observed, “every business or interest that could afford a half-competent lobbyist stands to benefit, at least until cap and tax is in place and environmentalists crack down over time.”
Whether or not the cap and tax bill will have any effect at all on “climate change” or “energy independence” – almost certainly not - the measure will assuredly achieve a major objective of its sponsors. It will dramatically expand government regulation and increase tax revenues. Once that happens, energy sector businesses can be constantly shaken down for political support, and the new tax dollars can be used to hire more unionized government bureaucrats and buy even more votes.
Given the darkening mood of the electorate toward the party in power in Washington, a vote for cap and tax, like ObamaCare, could well be a career-ending act by many members of Congress (current public approval rating: 20%), who the country will be far better off without.
Vermont’s Looming Energy Sinkhole
A sizable and vocal group of Vermonter activists can’t wait to see the legislature shut down the Vermont Yankee nuclear plant. Alas, they have no idea how to replace its energy and economic contribution to the state.
Voting Yankee off the island will not get rid of the need for the 285 megawatts of dependable base load power that it delivers to Vermont utilities each year at bargain prices. Despite over $30 million extracted each year from electric ratepayers to finance Efficiency Vermont, energy savings from conservation are not likely to cancel the growth in electricity consumption as the region emerges from the recession. Tell us again, where will that energy come from?
“Wind power!” they proudly declare. Well, let’s see. Proposed wind projects have already been stymied by local opposition in Londonderry, Sutton and Ira. A strong proposal for four turbines at the abandoned radar base on top of East Haven Mountain was killed off by a PSB requirement that the promoter spend tons of money to assess the potential threat to birds and bats.
VELCO, the state’s transmission utility, estimates that inland wind turbines deliver about 15% of their rated capacity. That means the New England ISO power grid operators have to have lots of reserve power readily available when the wind inconveniently stops blowing.
Howard Axelrod, an independent power grid consulting engineer, has estimated that Vermont would need at least 800 Mw of installed wind power to replace Yankee’s 285 Mw. That indicates at least 400 2 Mw-rated turbines would need to be erected on Vermont ridgelines, plus all the transmission lines and access roads.
It would take at least five years to replace Yankee with a combined cycle natural gas plant, burning gas brought up by nonexistent pipelines from Massachusetts. Such plants work well, but put the grid at the mercy of fluctuating Midwest or Canadian natural gas prices. Past proposals to extend natural gas lines northward into Vermont have been hooted down by the enviros.
Yankee now supplies 6% of the electricity in the New England grid. Unless demand nosedives, that 6% (600 Mw in all) of baseload power will have to be found somewhere. Where? Coal-fired plants in the Ohio Valley? Somebody else’s (unbuilt) nuclear plant?
When the New England ISO is unable to put enough juice into the grid to meet the New England Reliability Commission’s performance standards, either some large users have to be cut off, or New England will suffer a brownout. To avoid this result, the ISO has to make desperation purchases at, frequently, astronomical prices.
Bringing in power from distant generators brings its own set of problems. There is presently not enough long-distance transmission capacity to keep 285 Mw of additional power flowing reliably into Vermont. Building more high-voltage transmission lines, of course, brings out the enviros and their lawyers.
What will happen to Vermont’s economy if Yankee winks out in 2012? Its 669 employees (average wage: $104,000) will start disappearing. The $93 million Yankee injects into the Vermont economy will start heading south. The state’s desperate General Fund will lose $7.6 million a year, and the Education Fund will lose $6 million a year.
These economic facts, and more, are contained in a report prepared last January for the International Brotherhood of Electrical Workers Local 300 by the highly reputable Vermont Economic Consulting Inc. The study used payroll data in a well-established economic model, and did not inflate its findings by adding in speculative benefits.
Vermonters should be shocked at the militant attitude of one of the three anti-nuclear Democratic Senators running for Governor on promises of creating good new jobs for Vermonters. According to George Clain, head of the IBEW Local, the unnamed Senator (it’s doesn’t take a genius to figure out which one) informed the labor leader that “your members [at Yankee] have two years notice – they should be looking for other jobs.”
Former Gov. Tom Salmon, a Democrat, told a Vermont Energy Partnership conference in Montpelier last month: “The loss of Vermont Yankee would be a profound and unmitigated blow to Vermont and its people.” Next January the 2011 legislature will have one last chance to avert that blow. Voters concerned about living in a brownout world ought to put every candidate on the record early on. The size of this looming economic and energy sinkhole is far too important to overlook.
Think Again: Vermont’s Nuclear Future
On February 24 the liberal Vermont legislature voted a potential death sentence for Vermont Yankee, the source of a third of the state’s electricity. In doing so it became the first time in American history that politicians voted to shut down a safe, reliable operating nuclear reactor. In fact, Vermont is the only state in the union where legislators have ever given themselves the power to order a shutdown.
The anti-nuke people, led by Senate President Peter Shumlin, have for years been trying to shut down Vermont Yankee solely because they believe nuclear energy to be an unsafe and indeed immoral blight on humanity.
In recent years Entergy Nuclear Vermont Yankee, since 2002 the licensee of the plant, has given encouragement to its opponents. The Vernon plant has had a series of maintenance embarrassments – none of them consequential, but together enough to give the public the idea that the plant is a threat to fish, groundwater, bystanders, and future generations. Most recently, the opponents seized on a careless statement by an Entergy vice president (now departed) to charge that the company was lying about the existence of underground piping.
Let’s look at the consequences if Shumlin’s forces ultimately succeed in voting Vermont Yankee off the island.
By late 2012 the cheapest and most reliable third of Vermont’s electricity will disappear. There is zero possibility that it can be replaced by any believable combination of conservation, wind turbines, solar panels, cow power, and landfill methane. Moreover, the wind and solar kilowatts come with a price tag from three to five times the price of Vermont Yankee’s nuclear electricity. Furthermore, keeping the power grid steady when a third of the supply comes from unreliable sources remains an unsolved engineering problem.
We might be able to double the power purchased from HydroQuebec – if its management has forgiven Vermont for its ill-advised lawsuit aimed at breaking its supply contract after the ice storm of 1998. But that would leave Vermont with 2/3 of its power from a single supplier, not a good idea.
More likely, we would end up going to the New England electric grid operator (ISO) and asking it to send up whatever we need from wherever they can find it – mainly coal burning plants – at whatever price they can get it for. This would not only be expensive, but it would defeat our self-imposed goal of cutting carbon dioxide emissions back to 75% of 1990 levels (!) by 2012, and 50% by 2028.
In 2002 ENVY and the PSB agreed that after decommissioning the Yankee site would become a “greenfield”, such as the Abenaki once roamed. That will cost an estimated $900 million.
Since there is only $427 million currently in the decommissioning trust fund, the plant will have to go into SAFSTOR for a decade or two until the fund’s earnings grow to cover the work. That might produce an opportunity even after an ill-advised legislative death sentence.
SAFSTOR is estimated to cost about $40 million per decade, for monitoring and security. Ten years after 2012, when much of the residual radioactivity has disappeared, the reactor core and piping systems would be removed. All the spent fuel rods would be removed to a storage area.
By 2022 new Generation IV nuclear systems ought to be on line. With the Yankee site’s good location, 125 acres, rail spur, cooling towers, switchyard, security, shops, and land use permits intact, what better place to site an Integrated Fast Reactor, coupled with a pyroprocessing facility to recover the 95% of energy stored in spent fuel rods? Or a high temperature Pebble Bed Modular Reactor, whose very hot steam facilitates efficient electrolysis to produce hydrogen for our non-polluting fuel cell vehicles?
Thirty four Republican legislators, led by Rep. Pat O’Donnell of Vernon, have introduced a resolution (JRH41) that envisions such a conversion, notes that President Obama is a new fan of advanced nuclear energy, and recognizes the importance of the high-skill jobs that would come with a new generation reactor station in Vermont. It calls on the legislature and PSB to start planning for it now – regardless of whether Vermont Yankee is relicensed.
And here’s a kicker: not having to “greenfield” the plant in Vernon in, say, 2022 would make it unnecessary to spend a ton of money – possibly into the hundreds of millions of dollars. If the current PSB order remains in force, the licensee would have to return any leftover funds after decommissioning to ratepayers. If the plant is converted to a new use, that provision could be amended, and the excess used to restore the Unemployment Insurance fund for years.
The Collapse of the “Global Warming” Scam
Ever since Prof. James Hansen’s 1988 testimony before a Senate committee featuring Al Gore, Americans have been treated to a steady drumbeat of alarm over the Menace of Global Warming. Hansen, Gore, and a host of enviro organizations have proclaimed that human addiction to carbon combustion is causing global temperatures to rise alarmingly, and that governments must take unprecedented and desperate measures to reduce emissions.
The alarmists’ central argument was, and is, that a doubling of the present atmospheric concentration of CO2 will produce global temperature increases of as much as 8.6 degrees C by the end of this century. This would produce unimaginable catastrophes: droughts, flood, hurricanes, drowned coastal cities, plague, species extinction, and more.
Skeptics noted that the Medieval Warm Period (900-1200) brought better weather, improved nutrition, and a wonderful flowering of civilization. More atmospheric CO2 would spur plant growth, and warmer winters would help New Englanders by lengthening their growing seasons, reducing their heating bills, making their travels easier and safer, and disadvantaging the competing ski areas further south.
The warming zealots scorned such observations. Their technique was to spend billions of taxpayer dollars on computerized climate models. The scientists who controlled both the models and the input data churned out scary scenarios aimed at terrifying politicians into approving the taxes, rationing, subsidies and penalties needed to curb greenhouse gas production worldwide.
The fact that the models failed to reproduce the known temperature record of the past century gave them no pause whatever. The charlatans simply invented unobservable climatic effects that magically led to the positive feedback that assured the approach of Al Gore’s Heat Death.
The United Nation’s climate body, the IPCC, issued periodic reports attributed to “over 2,000 climate scientists”, but actually produced by a very small number sucking up millions in research dollars, plus the ever-present political flacks who actually crafted the “summary for policymakers”.
In 2007 Al Gore received a Nobel Peace Prize for his films and lectures, that were so bad that a British court held that they could not be shown to schoolchildren without correction of the nine glaring scientific errors contained therein. Gore shared the prize with the IPCC itself.
All the while the warmists were conspiring to deride any scientist who failed to buy into the warming hysteria. They denied them space in scientific journals, kept them off of conference agendas, and shouted “the science is settled” whenever skeptics raised an objection.
But the Earth refused to cooperate. Since the El Nino temperature spike of 1998, the computer predicted global warming failed to appear. Just as the critics had said all along, the climate models are billions of dollars worth of rubbish.
In mid-November unknown persons hacked into the files of the Climate Research Unit at the University of East Anglia, one of the leading research centers that the IPCC relied upon for its scary predictions. This brought to light over three thousand email messages among the most prominent scientists engaged in this scam.
In them the conspirators discussed how they falsified the models to “hide the decline” and preserve the threat of Al Gore’s Heat Death. They discussed keeping dissenting science out of prestigious journals and, it turns out, reported that they had deleted some raw data used in their modeling before anybody used the Freedom of Information Act to review it.
Now scientists not in on this scam have begun to penetrate the data. In the leading instance, Darwin Zero from North Australia, they discovered that the CRU “adjusted” the data not just to allow for relocating weather stations, but by simply adding degrees to make cooling trends into warming trends. Wrote one Australian scientist, “they are indisputable evidence that the ‘homogenized’ data has been changed to fit someone’s preconceptions about whether the earth is warming.” There’s a name for this: fraud.
And since the whole edifice of human-caused “global warming” (rechristened ”climate change” when warming failed to appear) is erected upon essentially the same raw data, the discovery of the deliberate corruption of that data destroys the alleged scientific basis for anthropogenic global warming. It also fatally undermines the political pressure for supranational controls over energy and economies so long urged by socialists and special interests of various stripes.
This is very bad news for the global warming crowd, from President Obama to Sen. Sanders, the big business Climate Action Group, Vermont Senate President Peter Shumlin, VPIRG, propagandist Bill McKibben, and the nuts in polar bear suits roaming the state house lawn.
But it’s good news for the inhabitants of Planet Earth, who will now likely be spared a new world energy government promulgating economically destructive mandates, taxes and rationing on the world’s struggling economy. Not a moment too soon.
The New Solar Electricity Ripoff
One of the most intense concerns of the enviro-laden majority party in recent legislatures has been to find some invisible way of subsidizing its favorite corporate welfare recipient, “renewable energy”.
The 2005 legislature created a “Clean Energy Development Fund” to make grants and loans to qualified wind, solar, biomass, methane, small hydro and other renewable energy promoters. The solons funded it by socking Vermont Yankee to the tune of $28 million, in return for permitting the nuclear plant to store spent fuel rods in concrete casks on its own property.
But that wasn’t enough. The follow-on idea is called SPEED. It requires electric utilities to purchase up to 50Mw of wind, solar and methane-generated electricity at shockingly high rates.
Vermont has already had a bad experience with this kind of corporate welfare game. A 1978 Federal law called PURPA, now mercifully expiring, required Vermont utilities to purchase power on long-term contracts from a dozen Independent Power Producers (small hydro plants and one big woodchip plant). The government calculated the purchase price in the belief that fossil fuel prices would soon reach $100/barrel of oil equivalent. (Even after two decades of dollar depreciation, oil is now around $80/bbl). That’s why IPP power (8% of Vermont’s consumption) has been the most expensive part of every utility’s portfolio.
But never mind that experience. When the legislature can’t tap some handy pot of money to promote this fetish, it forces the Public Service Board and the utilities to do its dirty work in the hope nobody will notice the increase in electricity rates.
The 2009 amendments to the SPEED program forced the utilities to purchase up to 50Mw of qualified renewable electricity through a “feed in tariff”. Willem Post, an experienced mechanical engineer from Woodstock, has performed a detailed analysis of the economics of commercial solar photovoltaic electricity.
Post took as his model a one Mw rated system (83,333 sq. ft., roof- mounted on a big box store). He assumed, generously, that the system would have a 25-year service life and no component replacement. The system’s installed cost at today’s prices would be $6.5 million ($6500/kw). Thanks to the 30% federal tax credit, the amount to finance drops to $4.55 million.
Of course the sun doesn’t shine all the time. Post assumed, realistically, that in Vermont the panels would receive peak sun 4.3 hours per day on average, at 80% conversion efficiency. That projects to 1,255,600 kwhr/year.
Under the SPEED program, the legislature decreed that utilities must purchase solar electricity at a rate of 30 cents/kwhr. This is about five times what the utilities are now paying for wholesale nuclear-generated electricity. Post assumed that the 30-cent “feed in tariff” would continue through 2029. For the remaining five years the utilities would pay the seller 2/3 of the prevailing rate.
Over the 25 years this Big Box PV system will produce $8.574 million in revenues. The financing cost for the system (at 6% interest) comes to $8.9 million. From this the big box owner can deduct 10-year depreciation and interest paid ($3.796 million) from its other income, leaving a net gain to the owner of $3.47 million.
From Post’s spread sheet one can calculate that over the 25 years the utility’s other ratepayers will pay an extra $2.19 million for the Big Box PV kilowatt hours, assuming a current wholesale retail market price of 12 cents/kwhr increasing by 4.7% a year to 37.8 cents/kwhr in 2034. (From 2029 to 2034 the PV electricity will be less expensive than the market rate – unless the PV producers can persuade a future PSB or legislature to increase their FIT rate to keep the subsidies coming.)
So here’s the 25 year scorecard: utility rate payers – IBM, Killington, small businesses, town governments, farms, churches, and Grandma – will pay $2.19 million in higher electricity costs. Federal and state taxpayers will pay $1.95 million in up-front tax credit subsidy, plus $3.796 million to make up for the depreciation and interest deductions (at a combined Federal and state income tax bracket rate of 35%).
Big Box PV pockets $3.47 million after all expenses – for installing and operating less than one tenth of one percent of Vermont’s electricity capacity. No wonder the Public Service Board received 200 Mw worth of feed in tariff proposals, four times the (current) 50Mw cap.
For whom is this a good deal, again?
The Return of Reactionary Liberalism
Some years ago the columnist Charles Krauthammer penned a column on the evocatively-labeled “reactionary liberalism”.
The old and true liberalism identified a social good – welfare, nutrition. housing assistance, health care for the aged, etc. It boldly declared that no civilized society could neglect such essential ingredients of social justice.
When old and true liberalism gained a legislative majority, it enacted government programs to meet those perceived needs – and it unashamedly raised taxes on the better-off to pay their costs.
“Reactionary liberalism” recognizes the same needs, but its practitioners lack the political courage to raise the taxes to pay the bills, and face the wrath of the taxpayers.
So reactionary liberalism contrives to use the power of government to force third parties to shoulder the costs of its liberal agenda. Those third parties – usually private businesses – are then forced to raise their prices to cover the additional burden of supporting the mandated benefits.
Those additional costs are thus transferred from the business to its customers or ratepayers. And the perverse beauty of this, from the reactionary liberalism standpoint, is that the victims who are paying can’t figure out who to blame for having less money in their pockets. What a sweet deal!
A flagrant example of reactionary liberalism is now moving through the state house. This year’s chosen program is the forced promotion of renewable energy.
Enviro-liberals love the idea of renewable-source electricity for several reasons. Most of them believe, with far more fervor than evidence, that human carbon dioxide production has created the Menace of Global Warming, and will eventually boil the planet in its own juices.
Coal-fired power is anathema, due to its acid rain-causing emissions and environmentally destructive mining practices.
There are no significant hydroelectric sites left in Vermont, and liberals have always been uncomfortable with HydroQuebec’s giant power dams because they alter the environment (in northern Quebec) and discomfit the Cree Indians.
Nuclear power? Certainly not. Liberals hate everything about the Vermont Yankee plant and the Louisiana-based corporation that owns it. Thirty-seven years of producing clean, reliable, low-cost, zero-carbon electricity weighs nothing in their scales.
Thus the electricity of choice comes down to renewable wind, solar, and to a lesser extent, landfill methane. And reactionary liberalism has a nifty technique for promoting these hopelessly inefficient energy sources. Its House majority just passed a bill (H.446) that requires the utilities to purchase all the electrical output of small scale (2.2 Mw or less) wind and solar projects, up to a cumulative total of 50Mw.
This the utilities must do at a price, fixed by politicians, that guarantees the renewable power operators enough revenue to pay off their investment and operating costs, and yield a “reasonable” profit.
Of course, the renewable operators cannot produce electricity at anywhere near the going market price. So the House proposes to mandate that the utilities pay wind power operators 20 cents/KWhr, and solar electric generators 30 cents/KWhr, for twenty years. This is four and six times the price the utilities are now paying for a KiloWatt-hour from Vermont Yankee.
If this turns out to be not enough to produce ”sufficient incentives for the rapid development and commissioning of plants,” the Public Service Board, wholly unaccountable to rate payers and voters, can jack up the mandated prices. And the next legislature can easily remove the 2.2 Mw and 50 Mw cumulative caps.
Who will eat the cost of this mandated high-cost electricity? Everyone who uses electricity – but they will not understand why their power bills went up three percent (for openers), and who to hold accountable at the polls. That’s the beauty of reactionary liberalism to its practitioners. It combines hidden taxation with corporate welfare.
The House bill also provides that if a utility experiences grid reliability difficulties due to erratic generation from a mandated flock of off-again, on-again wind and solar plants, as recently happened in wind-intensive west Texas, “the state is not liable for the consequences”. Very thoughtful.
Meanwhile CVPS, under full-throated pressure from the enviro groups, grudgingly agreed to tear out the sixty year old Peterson Dam in Milton. Good riddance to that clean, renewable two-cent/KWhr power plant! Hurray for the fish! Is it any wonder that Vermont has become the butt of jokes among people with some grasp of economics, energy, and common sense?
Gov. Douglas has said that he does not support this shabby scheme. If there are enough reactionary liberals in the Senate to advance the House bill to his desk – highly likely – hope for another veto.
The Mother of All “Global Warming” Scams
One of the first acts of the new Obama administration was to jump start a regulatory process that, if carried through as urged by Vermont’s Attorney General, will put a crushing new burden on America’s beleaguered auto industry and impose enormous regulatory costs on Vermonters.
Since 1967 the Clean Air Act has regulated air pollution from motor vehicles: nitrogen oxides, particulates, ozone, and other products of petroleum combustion that have harmful effects on human health.
The Act reasonably provides that individual states can’t create a patchwork of regulations that would impose much higher costs on automakers, and therefore higher prices to consumers. But the act authorized California, with its Los Angeles smog problem, to seek a waiver to cope with its extraordinary conditions.
In 1975 Congress adopted nationwide corporate average fuel efficiency standards (CAFÉ) for motor vehicles, and significantly stiffened them in 2007 (to 35 mpg in 2020.) That act specifically forbids states from imposing fuel economy standards of their own.
In the 1990s Al Gore and the enviro groups invented a powerful new political tool for seizing control of global energy production and consumption, and thus of the world economy. That was the Menace of Global Warming: the urgent conjecture – backed only by computer projections – that human combustion of carbon is cooking the planet.
To battle this supposed menace, California enviros got their legislature to pass a bill in 2002 authorizing state regulation of carbon dioxide emissions from motor vehicles. Years of improved engine efficiencies have reduced emissions per ton-mile, but now the only practical way to further reduce CO2 emissions is to push motorists into ever smaller vehicles that use less fuel per mile, or expensive hybrids and other exotic vehicles powered by fuel cells, compressed air, or batteries.
In 2005 California applied for an EPA waiver to impose its emissions regulations. Hypergreen Vermont rushed to get in on the California action. The Douglas administration approved a California-type emission regulation. The automakers sued to enjoin its application, even though California still hadn’t won its EPA waiver. In 2007 Federal Judge William Sessions ruled that if EPA gives California a waiver, the California regulations can be applied in Vermont. (The case is on appeal.)
In 2008 Congressman Peter Welch, with a California colleague, introduced a bill to force the despised (by them) Bush EPA to issue the California waiver. When that failed, California Gov. Arnold Schwarzenegger and Attorney General Jerry “Moonbeam” Brown went back to court to try to force EPA to act. Attorney General William Sorrell quickly joined the parade.
Now Bush is gone, and President Obama has directed his EPA to reconsider the Bush EPA’s waiver rejection. Governor Jim Douglas issued a statement praising Obama for his “action on his pledge to address climate change.”
Let’s assume the Obama EPA gives Schwarzenegger, Brown, Sorrell, Douglas, and Welch their heart’s desire. What will it mean for Vermonters?
It will mean that about six years from now many Vermonters registering a new car will have to pay more – probably a lot more – for an exotic upscale hybrid, or cram themselves into a smaller and less crashworthy car, van or truck.
Will that solve Vermont’s air pollution problem? No, because sparsely populated Vermont doesn’t have an air pollution problem caused by tailpipe emissions.
Will that defeat the Menace of Global Warming? No, because for eight years the planet has been steadily cooling, and the complete disappearance of sunspots predicts a couple of cold decades ahead. In any case, human-caused emissions of carbon dioxide have no detectable effect on climate change.
But the cost, inconvenience and utter folly of implementing this motor vehicle emission scam is far from the whole story. An Obama administration determination that EPA must regulate CO2 as a “pollutant” will almost certainly cause a regulatory cascade.
It will bring into play Prevention of Significant Deterioration regulations, not just on vehicles but on stationary businesses, buildings, road construction and farms (with over 25 cows) that emit 250 tons of CO2 per year. That will force hundreds of Vermonters to obtain EPA permits requiring the installation of Best Available Control Technology.
It will probably trigger new National Ambient Air Quality Standards governing carbon dioxide “pollution”, requiring that the present atmospheric concentration of CO2 actually be reduced. And it would surely drag thousands of Vermonters into a complex, costly, drawn-out and maddening permit process.
In short, this regulatory madness will hammer the already desperate auto industry and impose severe burdens on any significant CO2-producing activity. It will, as intended, depress petroleum consumption, but it will contribute nothing toward combating the illusory Menace of Global Warming.
“This is a big victory for clean air, “ Congressman Welch said of the Obama action. He should – and probably does - know better. EPA regulation of CO2 emissions would have nothing whatever to do with cleaning up air pollution. It would have everything to do with strangling the reeling U.S. economy with complex and costly regulations, and bestowing a political victory upon bad science, big government, partisan politics, and unscrupulous enviro groups and their political allies.
The remaining question now is whether the Obama administration, which now owns this problem, will have the backbone to say no to all the enviros and kindred politicians now playing out their final act of pounding lumps on the departed George W Bush. It’s not out of the question that it will. Let’s hope so.
George W. Bush’s Last Sorry Gift to America
To the relief of a majority of Americans – and a very large majority of Vermonters – the presidency of George W. Bush will terminate on January 20. But President Bush will likely leave America with one final gift, one that if carried through by the Obama administration will wreck what’s left of our productive economy.
The wrapper on this improvised explosive device reads “Environmental Protection Agency Advance Notice of Proposed Rulemaking: Regulating Greenhouse Gases Under the Clean Air Act.”
This ugly story began back in 2003 when a bunch of hyper-enviro attorneys general, predictably including Vermont’s William Sorrell, petitioned EPA to regulate carbon dioxide emissions under the Clean Air Act. They did so because the Bush Administration had reversed a finding by a Clinton-era EPA lawyer that CO2 was a “pollutant” subject to regulation.
Unlike the pollutants regulated under the Clean Air Act - things like sulfur dioxide, nitrogen oxides, volatile organic compounds and ozone – CO2 is no threat to healthy lungs. In fact, and fortunately for human life, healthy lungs produce CO2 with every exhaled breath.
The petitioners argued that CO2 may not produce diseased lungs, but a higher concentration of it will endanger human health and welfare. That’s because, so “scientists” say, increased emissions will bring on the Menace of Global Warming, the ice caps will melt, sea levels will rise, malaria will spread, and the polar bear population will shrink.
The Bush EPA denied the petition. Sorrell & Co. went to the D.C. appeals court. It ruled against them. They then appealed to the Supreme Court. And in one of the most ludicrous (5-4) opinions of the past century, the Court’s most liberal justice decreed that despite the lack of any legislative history supporting CO2 regulation, and despite the fact that twice the U.S. Senate voted down proposals to require CO2 regulation, EPA had to decide whether CO2 emission was a danger to the public, and if so, regulate it.
At this point a real President would have announced, “Look. When Congress, on the record, passes a law to require EPA to regulate greenhouse gases as pollutants – over my veto – I will faithfully execute that law. In the meantime I have no intention of letting EPA bureaucrats wreck our battered economy by issuing sweeping regulations over activity that Congress has never voted to regulate.”
“If Justice Stevens and his four friends believe so strongly that CO2 emissions should be subject to Federal regulation, they are free to work to elect a Congress that will do what even Nancy Pelosi and Harry Reid don’t dare to do. Good luck. And if the five honorable justices think that’s beneath their dignity, they can retire to their chambers and pound sand.”
Unfortunately this country does not have such a President.
Instead, the Bush EPA put out this Notice that the Wall Street Journal observed “would [if finalized] trigger an economy-wide cascade of new rules and mandates. Just about everything that emits carbon [dioxide] would be affected, including cars, factories and power plants, but also farms schools, hospitals, restaurants, and office buildings.”
Michigan Congressman John Dingell, the venerable Democratic chairman of the House Energy and Commerce Committee, said the proposed regulations had “the potential for shutting down or slowing down virtually all industry and all economic activity and growth.” It would surely wreck what’s left of the U.S. auto industry.
The Notice governs not only industries, power plants, cars, trucks and airplanes, but also greenhouse gas emissions from dairy herds of more than 25 cows. It would regulate logging and farms with over 500 acres of crops, farm tractors, and lawn and garden equipment. EPA even proposes regulations for snowmobiles and dirt bikes.
The Competitive Enterprise Institute, which has followed this issue carefully from the beginning, points out that an EPA finding of “endangerment” could also compel the agency to establish new National Ambient Air Quality Standards for CO2. Since Sorrel and the enviros contend that existing greenhouse gas concentrations are already harming public health and welfare, EPA would have to issue NAAQS below current atmospheric levels. To reduce those concentrations would almost certainly require a carbon tax built into the price of every product, and a tariff to assess a similar charge on imports.
Enviros can harmlessly amuse themselves by prancing around the state house lawn in polar bear suits, but this is serious business. Vermonters, whose state gave Barack Obama such a huge margin of victory, might want to suggest to the new President that this economy-wrecking madness ought to be thrown out along with other unpopular policies of the departing Bush administration.
Moonbeam Lawsuits to Stop Growth
The little mountain town of McCloud, high in the Cascade Range of Northern California, is a long way from Vermont. But recent events centering on McCloud may be a forerunner of what can easily happen here.
The McCloud area is famous for its natural springs. That abundance of pure water attracted the attention of Nestle Waters North America, a division of the Swiss-based Nestle corporation. Nestle entered into an agreement, accompanied by environmental impact studies, with the local government to pump 195 million gallons of spring water a year, and ship it off in three billion plastic bottles from a large new plant built in the former lumber town.
In 2006 California voters elected as their attorney general Jerry Brown, known during his two erratic terms as governor as "Gov. Moonbeam". Brown's current obsession is to save Planet Earth from the supposed evils of manmade global warming.
Brown has aggressively pursued a state lawsuit to force the Environmental Protection Agency to give his state a waiver to allow it to regulate carbon dioxide emissions from motor vehicles. He has also sued automakers and coal plant manufacturers for damages (floods, fires, etc.) that Brown believes were caused by CO2 emissions.
For all this, Brown has become the hero of the most radical enviros. The policy director for the Center for Biological Diversity, one Kieran Suckling, says Brown is "taking the strongest action of any attorney general in the country", an accolade that must sorely chagrin Vermont's William Sorrell.
On July 29 Brown plunged into the McCloud project with a ten-page letter to the Siskiyou County planning department. The letter denounced the draft environmental impact statement, demanded that it be done over, and made it clear that he would take legal action to block the water project in court if Nestle failed to comply.
Certainly there are important environmental issues here that would be of concern to any district environmental commission in Vermont: water withdrawal, electric power demand, and truck traffic come to mind. But to the hyperGreen California AG, the fatal defect in the McCloud project is the failure of the local government and Nestle to propose some way to stop greenhouse gas emissions from the manufacturing process, the electricity to run the factory and pumps, and the motor fuel burned to move trucks in and out.
The specific authority for what the local newspaper called Brown's "war on carbon" is his state's Global Warming Solutions Act of 2006. This act requires action to reduce California's greenhouse gas emission levels to pre-1990 levels by 2020. Brown takes that as a license to threaten legal action whenever he spots a suitable target - manufacturing, road construction, shopping centers, rural housing, whatever.
In 2006 the Vermont legislature passed a sister bill to California's act. Act 168 established the state's goal of reducing greenhouse gas emissions not just to the 1990 baseline, as California's does, but 50% below that baseline by 2028. This Greenie feel-good legislation passed 25-0 in the Senate and 132-6 in the House.
Act 209 just signed into law this summer requires that every new state government rule include a greenhouse gas impact statement. Rules shall be "crafted to reduce the extent to which greenhouse gases are emitted."
Act 250 requires that a project will not result in undue air pollution. For its first 30 years that was taken to refer to the pollutants regulated under the Clean Air Act. But now the attorney general has made the state a party to a lawsuit aimed at forcing the federal EPA to regulate what the enviros call "greenhouse gas pollution", that is, carbon dioxide.
Add all this up, and sprinkle liberally with AG Sorrell's enthusiasm for joining enviro lawsuits initiated by publicity-seeking AGs in other states, and it should come as no surprise when the AG blocks a development because its electricity, heating and motor fuel consumption would - when added to everybody else's - make it impossible for Vermont to meet its declared greenhouse gas reduction goals.
When Act 168 passed, Rep. Joyce Errecart (R-Shelburne) voted No. Said she, "the goals in this bill will be impossible to meet, and we don't know what the consequences are of placing unattainable goals in statute."
Now that Attorney General Moonbeam has blazed the trail in the McCloud controversy, Vermonters may find out those consequences soon enough.
The Multibillion Dollar Energy Tax
This week the U.S. Senate begins debate on the Lieberman-Warner “greenhouse gas cap and trade” bill. The bill proposes what the Wall Street Journal has called “the most extensive government reorganization of the economy since the 1930s”.
If that formulation doesn’t alarm you, try this one: Last year the Congressional Budget Office – controlled by the Democrats - reported that, depending on the final version of the bill, it will tax from $50 and $300 billion per year (in 2007 dollars) out of the economy by 2020.” Every dime of this is a hidden tax that will ultimately be paid by consumers: industries like IBM, OMYA, and the Vermont ski industry, plus Joe’s Machine Shop, Farmer Brown, Marilyn Motorist, and you.
The stated reason for this economy-wrecking bill is the supposed need to reduce carbon dioxide emissions to save the planet from The Menace of Global Warming. Never mind that there is heated debate among scientists as to whether human-caused greenhouse gases have any detectable effect on the planet’s climate. Never mind that even the advocates of the UN’s Kyoto greenhouse gas limiting protocol admit that its ambitious carbon dioxide reduction goals would, if (improbably) achieved, reduce global temperatures by less than a third of a degree Fahrenheit by 2100.
The VPIRG Green socialists want action now. And even if there proves to be no climate benefits at all, there will be other benefits: the Lieberman-Warner legislation will impose broad new government controls over America’s energy-intensive economy.
If burning carbon is the problem, an economist would argue that the straightforward method of cutting back emissions would be a carbon tax. But a carbon tax has this fatal political flaw: it’s a tax that everyone can see and get mad about, and legislators who vote for it will pay the price. The great advantage of the cap and trade scheme is that its victims can’t figure out how and by whom they are getting screwed.
Here’s how it works. U.S. government bureaucrats will somehow decide how much carbon dioxide emission will be allowed for every enterprise. That’s the cap.
Then the enterprises can either cut back their emissions to get under their assigned cap or, if it’s cheaper, they can buy emissions credits from other emitters who have credits left over. That’s the trade.
The bill now before the Senate specifies that the government would set aside an average of $20 billion a year to 2050 for consumer tax relief, which will be far too little to compensate consumers for the higher prices they’ll pay for everything made with energy, including notably gasoline, diesel, and home heating fuel.
The aforementioned CBO report found that the “impacts would be regressive in that poorer households would bear a larger burden relative to their income than wealthier households would”. Strangely, the party that constantly wails about the evils of regressive tax policies is now rushing to impose this regressive energy tax on poorer American families.
Much of the impetus for enacting Lieberman-Warner comes from certain big corporations that believe they can make big bucks by pocketing free credits for emissions they have already reduced “voluntarily”, and selling them to other energy users. These include Duke Energy, Alcoa, General Electric, BP, Dupont, Shell, and Marsh.
Strangely, the party that constantly denounces Big Business for earning “obscene” profits thanks to misguided public policies has welcomed these energy-rationing profiteers into their cap and trade coalition. The VPIRG climate guru Bill McKibben has even declared Sen. Bernie Sanders a “hero” for pushing to the front of this screw-the-consumer corporate welfare parade.
Six years ago Gov. Howard Dean put Vermont on record in favor of a cap-and-trade scheme when he bought into what became the Regional Greenhouse Gas Initiative. Gov. Douglas has shown no signs of backing off, and is about to sign a bill (S.350) that instructs the secretary of natural resources and the public service board and department to advocate before “regional or national entities” in favor of “a national cap and trade program for greenhouse gas emissions.”
This political exercise is aimed at dramatically expanding government control over the U.S. economy. The cap and trade scheme obscures the tax it will impose on every consumer. It will require the hiring of untold thousands of new government functionaries to staff a new energy IRS, to inventory every emission, supervise every trade, and punish every cheater.
It will extract trillions of dollars from the economy, and it will yield huge profits for the corporations already organized to game the system. And besides wrecking the economy and screwing the poor, it will punish every motorist already suffering from $4 gasoline, every trucker and equipment operator suffering from $4.75 diesel, and every homeowner suffering from $4.55 heating oil.
And what will the public gain for enduring all this economic misery? One thing is for sure: that misery may dramatically enlarge government and make consumers poorer, but it will produce no detectable effect on the supposed Menace of Global Warming.
The Green Police State Averted… For Now
After the House upheld Gov. Jim Douglas’s veto of Sen. Peter Shumlin’s $25 million “thermal efficiency utility” last July, the author of that measure vowed to come back in January with even stronger legislation. That threat appeared to have fallen by the wayside in March when the House, on a 136-2 vote, passed and gained Senate acceptance for a far more modest bill (S.209). The bill authorized the Public Service Department to spend millions more of our tax dollars to explain to Vermonters that they can save money by practicing energy conservation, but it did not create Sen. Shumlin’s yearned for utility, nor did it levy taxes on his victim of choice, Entergy Vermont Yankee.
But on April 8 the Senate Natural Resources and Energy Committee, a hotbed of anti-global warming enthusiasm, disgorged another bill on the subject. As reported, the bill (S.350), initially authored by Sen. Shumlin, aka the senator from VPIRG, was somewhat shrunken down from its original scope. It nonetheless sought to lay the groundwork for program upon program that, when implemented, would assure Vermont’s place at
y another VPIRG enthusiast, Sen. Ginny Lyons, backed off that grand idea for now. As reported, the bill deleted the climate supergovernment in favor of a new “Vermont Resource Trust”. Ordinarily a trust holds funds or land interests. This “trust” had no such function. It was apparently to be a taxpayer-funded advocacy group charged with promoting the VPIRG green agenda to the 2009 legislature.
Also deleted in the reported bill was Sen. Shumlin’s
proposed tax on SUVs, vans and pickups for not being sufficiently energy efficient, and Act 250 amendments to make sure nobody develops anything in an inappropriate location. But the bill still contained plenty to worry about.
Are you ready to compute and register with the state your carbon dioxide emissions? A key feature of the bill required just that. The bill directed the Agency of Natural Resources to develop rules for emission reporting and verification applicable to every farm, small business, factory, hospital, school, vehicle owner and Grandpa who burns a brush pile after the first snow. A floor amendment inserted the modifier “significant” before emitter, but left it to the rule makers to define “significant”.
The bill stated that the agency rules would “monitor and eventually enforce compliance with this program.” This ominous provision would give thousands of Vermonters their first experience with the coming Green police state.
A floor amendment by Sen. Vince Illuzzi to postpone the greenhouse gas inventory until after five other nearby states had authorized the same – that is, postpone forever – failed 11-18.
A centerpiece of the bill reported to the Senate would have created a new “cap and trade” program, stating that “it is crucial to manage Vermont’s consumption of fossil fuels for transportation, residential and commercial heating, and industrial processes, so as to maximize the state’s contribution to lowering carbon emissions.”
Under a cap-and-trade program, the government first establishes, by a rule that no legislator votes on, “a set of annual carbon budgets for emissions associated with transportation, space heating, and industrial processes.” Then it distributes “right-to-emit” tickets to every fossil fuel user in the state, by auction, current emission levels, or possibly political influence.
If an emitter overproduces the evil substance, it must pay cash to obtain excess tickets held by those emitters operating under their cap. This is something that every single farm, small business, factory, hospital, school, and vehicle owner would have to cope with.
Of course the initial rules might apply only to major fossil fuel users, and let off Grandpa and his brush pile. But with the planet (supposedly) facing Al Gore’s heat death, how can hyper-Green Vermont for long ignore reckless carbon dioxide production of any sort?
Under pressure from nervous senators, Sen. Lyons secured adoption of a last-minute amendment to delete her own cap-and-trade section. In its place she offered new language directing the natural resources and transportation agencies and the public service department to adopt rules to do most anything needed to reduce greenhouse gas emissions. This was obviously an attempt to smuggle the Shumlin-Lyons cap-and-trade program back into the bill by hiding it in bureaucratic language.
As passed the Senate bill also contained a host of mandates on state agencies to report next year on how they propose to force an extreme Green makeover on the state. This includes, for example, finding ways to keep homeowners’ garbage out of landfills and forcing motorists off the roads and into commuter trains (as if we learned nothing from Howard Dean’s failed $28 million Champlain Flyer experiment.)
Now comes the good news. S.350 was referred to the House Committee on Natural Resources and Energy. When it emerged on April 21 it was a mere shell of the ambitious and indeed menacing Shumlin-Lyons Senate bill.
Gone was the intrusive greenhouse gas inventory requirement. In its place the House bill requires that Agency of Natural Resources merely compile publicly available data on emissions. The ominous “monitor and enforce” language also disappeared.
Gone too was the ambitious “Vermont resource trust”. In its place appeared a “climate change oversight committee”, to invite public input, form task forces, and work with various groups – but without any regulatory power or funding.
Most importantly, the broad agency rule making power contained in the Lyons amendment, designed to allow unaccountable bureaucrats to impose an extreme green makeover on the state, fell by the wayside. This deletion was made over howls of protest from the VPIRG lobbyists in the committee room.
In sum, the version of S.350 now likely to become law contains a lot of declarations of policy, numerous feel good suggestions, a bevy of reports required from state agencies, and not a little foolishness. What it does not do is place a serious burden on Vermont’s economy, or impose a Green Police State on persons and businesses not as enthusiastic about saving the planet from the Menace of Global Warming as Sen. Shumlin, Sen. Lyons, and VPIRG.
This outcome is a tribute to the common sense of practical leaders like House Natural Resources and Energy Chair Robert Dostis (D-Waterbury) and vice chair Joyce Errecart (R-Shelburne), and the respect in which they are held by their fellow Representatives.
But the forced shrinkage of S.350 by level headed legislators is no guarantee against another bout of global warming madness in another session, spurred on by the same actors and pressure groups. Vermont businesses – and indeed all Vermonters - need to remember clearly the astonishing breadth, depth, and cost of the Shumlin-VPIRG grand Green plan for our state, and be ready when its elements begin to reappear.
The Green Police State
On March 19 Gov. Douglas signed a bipartisan bill to have the Public Service Department spend millions more of our tax dollars to explain to Vermonters that they can save money by practicing energy conservation. With that, one might have thought that the VPIRG-inspired global warming craze had spent its force. Unfortunately one would have been wrong.
The Senate Natural Resources and Energy Committee, a hotbed of anti-global warming enthusiasm, has disgorged another bill on the subject. The bill (S.350), initially authored by Senate President pro tem Peter Shumlin, aka the senator from VPIRG, has been shrunken down from its original scope. It nonetheless lays the groundwork for program upon program that, when implemented, will assure Vermont’s place at the head of the honor roll of global warming warriors.
As introduced, the bill would have created a climate supergovernment – the “climate cooperative” – to ”coordinate statewide activities on climate change and all related energy activities.” The supergovernment would supervise a bewildering array of task forces and working groups to produce a host of reports advocating new regulations, controls, mandates, plans, rules, standards, taxes and subsidies.
The extremely liberal committee backed off that grand idea for now. As the bill now stands, in place of the supergovernment appears a new “Vermont Resource Trust”. Ordinarily a trust holds funds or land interests. This “trust” has no such function. It is apparently to be a taxpayer-funded advocacy group charged with promoting the VPIRG green agenda to the 2009 legislature.
Also gone from the current bill is the tax on SUVs, vans and pickups for not being sufficiently energy efficient, and the Act 250 amendments to make sure nobody develops anything in an inappropriate location. But there is still plenty to worry about in this bill.
Are you ready to compute and register with the state your carbon dioxide emissions? Get ready, because a key feature of the bill requires just that. By January the Agency of Natural Resources is directed to develop rules for emission reporting and verification applicable to every farm, small business, factory, hospital, school, vehicle owner and Grandpa who burns a brush pile after the first snow.
The agency rules will “monitor and eventually enforce compliance with this program.” This ominous provision will give thousands of Vermonters their first experience with the coming Green police state.
The bill as reported also created a new “cap and trade” program, stating that “it is crucial to manage Vermont’s… consumption of fossil fuels for transportation, residential and commercial heating, and industrial processes, so as to maximize the state’s contribution to lowering carbon emissions.”
Under a cap-and-trade program, the government first establishes, by a rule that no legislator votes on, “a set of annual carbon budgets for emissions associated with transportation, space heating, and industrial processes.” Then it distributes “right-to-emit” tickets to every fossil fuel user in the state, by auction, current emission levels, or possibly political influence.
If an emitter overproduces the evil substance, it must pay cash to obtain excess tickets held by those emitters operating under their cap.
This is not just something for electric generating companies to worry about, as under the Regional Greenhouse Gas Initiative. This is something that every single farm, small business, factory, hospital, school, and vehicle owner will have to cope with.
Of course the initial rules may apply only to major fossil fuel users, and let off Grandpa and his brush pile. But with the planet (supposedly) facing Al Gore’s heat death, how can hyper-Green Vermont for long ignore reckless carbon dioxide production of any sort?
Under pressure from nervous senators, Sen. Ginny Lyons offered a last-minute amendment to delete her own cap-and-trade section. In its place she offered new language directing the natural resources and transportation agencies and the public service department to adopt rules to do most anything needed to reduce greenhouse gas emissions. This is obviously an attempt to smuggle the Shumlin-Lyons cap-and-trade program back into the bill by hiding it in bureaucratic language.
The bill also contains a host of mandates on state agencies to report next year on how they propose to force an extreme Green makeover on the state. This includes, for example, finding ways to keep homeowners’ garbage out of landfills and forcing motorists off the roads and into commuter trains (as if we learned nothing from Howard Dean’s failed $28 million Champlain Flyer experiment.)
It’s about time Vermonters woke up to the astonishing breadth, depth, and cost of the Shumlin-VPIRG grand Green plan for our state. If fully carried out, the prescription contained in the initial and current versions of S.350 will leave the state a politically correct Arcadia for affluent Greenies who want to feel good about themselves. The rest of us will have to move on, if we can.
Note: On April 4 the Senate replaced the cap and trade language with an authorization for state agencies to use rulemaking powers to achieve the sweeping goals of the act, and inserted "significant" before the emitters required to register for the emissions inventory.
The Fanatic Anti-Nuclear Movement
Over Vermont’s 230 years several strange political movements persisted long enough to enter the history books. Among them, anti-Masonry, the anti-Catholic and anti-immigrant Know Nothing movement, and the Prohibition crusade all fizzled after initial successes.
The most notable fringe movement still alive today is the crusade against nuclear energy. It is, naturally, focused on Vermont’s lone nuclear reactor, Vermont Yankee, that went on line in 1972.
In the face of all science, reason, and experience, the anti-nuclear zealots fiercely maintain that the Vernon nuclear power plant is a standing death threat against the population for miles around, that its pall of radiation will produce deformed children, and that the plant’s present owner Entergy is a reckless and sinister enterprise making enormous profits while scornfully dismissing the concerns of its likely Vermont victims.
In recent years the New England Coalition Against Nuclear Pollution has been joined by the Vermont Public Interest Research Group. VPIRG wants nuclear energy terminated so that its preferred alternative, 420 foot wind turbines, will become economically competitive.
The attack on Vermont Yankee has escalated since 2003, and especially since 2007, when the champion of the anti-nuke/VPIRG forces, Windham County Sen. Peter Shumlin, returned to the Senate and again became its president pro tem.
In return for the state’s non-objection to an increase of Vermont Yankee’s electricity output by 20%, the legislators in 2003 demanded that the company pay $7.8 million to clean up algae in Lake Champlain, and another $2.1 million to subsidize low income home heating.
In return for state permission to store its oldest and least radioactive spent fuel rods in dry casks instead of in a water pool, the 2005 legislature required Entergy to pay $28 million into a “clean energy fund”, from which subsidies would be distributed to wind, solar and methane projects.
The 2006 legislature required that before Entergy can take operate under a 20-year Nuclear Regulatory Commission license extension likely to take effect in 2012, it must come back to Montpelier to be forced to make yet more extortion payments.
Last year, to fund his coveted $25 million “thermal efficiency utility”, Sen. Shumlin tried to break the 2005 agreement and impose a new tax on the plant’s stored fuel rods. When other legislators balked, Sen. Shumlin then invented an “excess revenues” tax falling only on Entergy. A House-Senate conference committee dropped that in favor of a new tax on Yankee’s electrical output. That in turn fell to Gov. Jim Douglas’s veto.
This year’s attack is twofold. One is a bill (S.364) to require Vermont Yankee to undergo an independent “comprehensive vertical audit and reliability assessment”. The cost of this lengthy and unprecedented procedure would far exceed the cost of periodic NRC inspections, and it would be borne by electricity ratepayers.
That’s bad enough, but the real show stopper is S.373. Entergy is undergoing a rational corporate restructuring that will separate its nuclear reactor fleet from any lingering connection with regulated public utilities. This bill demands that in return for Public Service Board approval of a new corporation’s acquisition of Vermont Yankee, Entergy must immediately pay as much as $400 million more into its Yankee decommissioning fund, or produce a credit guarantee for the same amount.
This is on top of the $440 million already in the fund earning interest, which will grow to be more than enough to decommission the plant when its extended license expires in 2032. This requirement would of course force hundreds of millions of dollars onto the backs of Vermont’s ratepayers.
The Associated Industries of Vermont put it succinctly: “S.373 is a fairly transparent attempt by anti-nuclear legislators to precipitate a financial crisis for Vermont Yankee to jeopardize its continued operation. In pursuing this bill, its supporters are threatening Vermont’s most valuable, clean, and reliable source of electricity in the years ahead.”
The great irony is that Sen. Shumlin and his VPIRG allies are pressing legislation (S.350) to force Vermonters to stop emitting greenhouse gases that supposedly threaten the planet with Al Gore’s Heat Death. Yet they are also working hard to shut down the nuclear plant that produces dependable lowest-cost electricity without emitting any greenhouse gases at all. This contradiction simply does not compute.
The anti-nuclear activists will not be satisfied until every trace of Vermont Yankee is gone, and the Vernon site is returned to the peaceful wilderness it was when only the Abenakis roamed.
This constant warfare against nuclear energy is, to put it plainly, mindless fanaticism. The sooner it goes the way of anti-Masonry, Know-Nothingism, and Prohibition, the better off Vermonters will be.
Extreme Green Makeover
Terrified by the supposed horrors of global warming, Vermont's Green legions are geared up to make 2008 the year of the state's Extreme Green Makeover.
That momentous event was to have been set in motion last year,but it suddenly expired with Gov. Jim Douglas's veto of Sen. Peter Shumlin's bill to lay a $25 million tax bill on the state's leading generator of clean electricity to fund a new state entity to go about persuading Vermonters to stop wasting money on heating fuels.
In July the Democratic-controlled House sustained the veto by 13 votes. That caused the ambitious Senator from VPIRG to declare that he would be back in the 2008 session with an even stronger bill. Now it's 2008, and he's back as promised.
Earlier this month the House Natural Resources and Energy Committee, ably chaired by the greenish but realistic Rep. Robert Dostis, brought out its version of an earlier Senate-passed energy conservation bill (S.209). The bill recites the Senate's global disaster mantra that "global climate change is threatening our environment and perhaps ultimately our existence". It then sets forth forty-seven sections of policy changes, including the creation of a non-monopoly energy efficiency program to meet the goals of the vetoed bill.
The bill expands the carbon cap and trade system under the Regional Greenhouse Gas Initiative. This is a multistate program where electric ratepayers of the other states will send money to Vermont to reward us for having such a green electrical energy system.
The bill also sets in motion the process for increasing the gross receipts tax on heating fuels, and creating a state public power authority. But all in all, the House version was restrained enough to pass that body on a 136-2 vote.
The Senate has in waiting the new bill Sen. Shumlin promised last July, S.350. Modestly titled the "energy independence and economic prosperity" act, the bill incorporates the entire radical agenda put forth by VPIRG.
The central feature of the Shumlin-VPIRG wish list is the creation of what can only be described as an energy super-government, the "climate collaborative", to "coordinate statewide activities on climate change and all related energy activities."
This unprecedented public corporate body would be controlled by nine "stakeholders" jointly chosen by governor and legislature. It would consist of one public official, two higher education representatives, two "business" representatives (presumably from the Vermont Businesses for Social Responsibility lobby), one from "conservation interests" (presumably VPIRG), one from low-income interests, one from "sustainable rural development" (presumably Rural Vermont), and one from Efficiency Vermont. Notably not included: taxpayers.
This super government would supervise a bewildering array of task forces and working groups to produce a host of reports advocating new regulations, controls, mandates, plans, rules, standards, taxes, and subsidies. The bill envisions or imposes
- strict "smart growth" land use control strategies,
- greenhouse gas emission inventories,
- aggressive implementation of Act 200's planning mandates,
- new Act 250 rules to impose "carbon neutrality" on developments,
- mandates for the protection of "dead and dying wildlife trees",
- doubling (heavily subsidized) passenger rail traffic by 2028,
- getting all single-occupancy vehicles off the highways,
- steeply increased vehicle sales and use taxes and registration fees on low-mpg vehicles,
- energy efficiency standards that must be met before homeowners could sell their houses, and
- biofueled bus tours to visit biofuel producing farms.
The collaborative would develop a "public education and engagement framework to encourage behavior change", through "social marketing strategies with broad ethical goals." An example: "in-depth, science-based in-school programs on energy efficiency and climate change at all levels."
This proposal emerged from a lobby group (VPIRG) that strenuously insists that all scientific questions about climate change have been settled, no dissent can be deemed credible, the planet is racing toward Al Gore's heat death, and only desperate wide-ranging big-government "solutions" will be considered!
And how will all this be paid for? In addition to the various taxes levied, the collaborative would create a working group to come up with ways for funding greenhouse gas reduction efforts. The collaborative itself, a veritable Manhattan Project of Green Social Engineering, would apparently be funded through the inexhaustible General Fund.
The far more reasonable House-passed bill contains numerous useful provisions, such as expansion of net metering, passthrough of federal tax incentives, and relaxation of some government-created barriers to energy enterprises. It also has some questionable inclusions, but it has strong bipartisan support, including that of Gov. Douglas.
If Sen. Shumlin and his VPIRG allies now try to load up the House-passed bill with selections from their sweeping Senate bill - especially the unaccountable global warming super government - it may well stimulate a backlash among a lot of average Vermonters.
It certainly should.
The Big VPIRG Climate Scare
On December 4, Vermonters were treated to a well-orchestrated media event designed to terrify them into endorsing a very expensive special interest policy agenda.
The occasion was the release of a new report by the Vermont Public Interest Group (VPIRG) claiming that “global warming will substantially increase the odds of extreme precipitation… scientists predict that warming temperatures will increase the frequency of major storms with heavy rainfall or snowfall.”
And since VPIRG urgently believes that human emissions of greenhouse gases are forcing catastrophic global warming, the report predictably contained all of its policy recommendations as a last desperate effort for humankind to fend off climate disaster.
Those recommendations include land use controls to create dense settlements, mandatory limits on fossil fuel emissions, more expensive renewable electricity from wind and solar, and an interesting item called “stabilizing vehicle travel”. This latter category includes incentives or penalties to promote walking, cycling, and public transit riding, to get people out of those awful private cars and trucks.
The report, entitled “When It Rains, It Pours”, was prepared by the Environment America Research and Policy Center created by US PIRG with funding from the Pew Charitable Trust. (Imagine the flip side: how much credibility would you give to a report on climate change produced by the National Coal Association?)
The key finding of the report for Vermont is a finding that our state “experienced a 57% increase in extreme rainstorms and snowstorms during the period studied” (1948-2006). It turns out, though, that since there were only 15 Vermont stations reporting, the actual increase at the customary 95% confidence level could have been 33% or it could have been 81%.
The report defines an “extreme” rainstorm as a storm that dropped as much precipitation in a 24 hour period as the smallest of the 59 biggest storm days of the 59 years observed, at the 3440 weather stations in the continental U.S. The VPIRG report is silent on this, but the Free Press story reported that the extreme storm threshold for Vermont was 1.51 inches of rain in a 24-hour period. Over the period studied this happened on the average about three times every two years.
Why did VPIRG choose the period 1948-2006? The report says its conclusions rest on the authority of Dr. David Easterling of the National Climatic Data Center. But the 2003 report cited to Easterling covers the period 1895-2000. In it, incidentally, Easterling observed that “[extreme precipitation] frequencies at the beginning of the 20th century were nearly as high as during the late 20th century for some combinations…suggesting that natural variability cannot be discounted as an important contributor to the recent high values.” (Emphasis added.)
Former Lyndon State professor of meteorology Joseph D’Aleo offers this explanation: the first half of the period studied was the beginning of the last cold phase of the Pacific Decadal Oscillation, an ocean current pattern that strongly affects storm tracks and thus precipitation over North America. Half way through the VPIRG study period the PDO flipped to its warm phase. VPIRG carefully picked a period where it could hardly have avoided getting the higher precipitation frequency that it wanted for shock effect.
D’Aleo believes that current global warming (and thus warming-related precipitation) is far more influenced by PDO and other ocean current changes than by any contribution produced by human activity.
The fact that VPIRG and its sister activist groups in other states waited to release the report until the eve of a Senate committee vote on sweeping climate change legislation (emphasized at the VPIRG news conference) adds weight to the suspicion that this report is more a political document than any kind of scientific revelation.
The report constantly refers to “global warming pollution” – a favorite enviro characterization of the emission of harmless carbon dioxide from fossil fuel combustion. This lends more weight to that suspicion.
To their credit, the Vermont news media (Free Press, Vermont Press Bureau, WCAX) sought out some expert opinion. Andy Nash, the National Weather Service lead meteorologist at Burlington, was clearly not buying the VPIRG climate fright. The Free Press reported Nash as observing cautiously that the data could be artifacts of the natural variability of the weather. WCAX quoted Nash as saying that the report does not present new data and raises more questions than it answers.
This won’t be the last time that enviro organizations pump up an enviro-scare to promote their political agenda. Vermonters need to greet these continual revelations with a lot of skepticism.
The New Green Regime
The report of the Governor’s Commission on Climate Change calls upon the Governor, the legislature and all Vermonters to make sweeping changes in the way Vermonters live. Not coincidentally, it recommends adoption of virtually the entire agenda of the state’s environmental movement dating back to 1970.
The foundation of this sweeping program is the supposed Menace of Global Warming, resulting from – so the report eagerly assumes - the human-caused emission of greenhouse gases. Declares the Report, smugly: “The time for debate over the realities of global climate change is over.” Vermont is at “grave risk”. Reducing greenhouse gas emissions is “the major challenge facing Vermonters in years to come.”
This alarming pronouncement reflects a deeply ingrained Green Theology that unshakably believes that selfish, greedy consumption-crazed humankind is turning the planet into a steaming hothouse, to avert which our governments must force us to make painful and costly sacrifices.
If Vermonters were the primary cause of the planet’s ills, it might make some sense to force us to mend our ways. But we aren’t. In fact, Vermont is already the greenest of the 50 American states. We are the invisibly tiny tail on the global carbon dioxide dog.
Long before they discovered The Menace of Global Warming, Vermont’s environmental movement had pursued a well-defined agenda. At the head of it was controlling and reducing air and water pollution. This was and is a sound policy. Except for agricultural runoff, it has largely been accomplished.
But after that, the more controversial goal was land use control. The Perfect Little State, they said, must have a State Land Use Plan to prescribe the correct use of every single acre of land.
The first attempt at enacting such a plan was beaten down after a four-year battle ending in 1976. A second attempt produced Act 200 in 1988, which by the mid-1990s had effectively expired. Always there were proposals for preserving “historical settlement patterns” - “development centers” with “traditional downtowns” - as the alternative to the evils of “sprawl”.
In every land use battle, the enviros heaped scorn on the human right of private property ownership. They view it as an obsolete relic of Dark Age selfishness and a unjustifiable nuisance to public-spirited planners.
Now the enviro land use control agenda is back again. In the name of fighting greenhouse gas emissions, the climate change report urges high-density development centers surrounded by CO2-absorbing pastoral landscapes and connected by public bus and rail transportation.
To suppress greenhouse gas emissions by private vehicles, the report favors “feebates” (penalty taxes) on low miles-per-gallon cars, vans and trucks, and a percentage-based sales tax to make motor fuel more expensive.
One might favor that latter proposal to raise funds to rebuild Vermont’s deteriorating roads and bridges, but that is clearly not the intent of the report. It wants to raise more money to subsidize public transportation, not to pay for better and safer highways for undesirable private driving.
The report urges that state government assess itself a carbon offset fee for having a “carbon footprint”. Thus not only would taxpayers pay for the state highway crews to plow the roads and state police to patrol them, but they would also pay additional taxes to the state to subsidize favored renewable energy producers. Wind turbines are mentioned..
The report advocates the creation of a “vigorous, proactive, public/private partnership to promote “enormous, systemic and long-term cultural, cross-generational change in our awareness and behavior through the efforts of our formalized K-12 public and private school systems.” (Whew!) Cynics will doubtless refer to this as the “Green Madrassa” proposal, whereby our environmentally-certified schoolteachers are instructed to fill up their pupils with certified Green Theology.
To direct and supervise these momentous changes, the report advocates creation of another public/private partnership to be called the Vermont Climate Collaborative. This centralized super-government would “insure coordination of efforts and development of cross-cutting initiatives to address climate change.” Creating the Perfect Little State requires no less!
There are, admittedly, some things in the report well worth doing, whether or not Vermont is threatened by The Menace of Global Warming. But throughout the report one looks in vain for any candid discussion of the costs that would be imposed on Vermonters. We are only told that the costs of not doing all this will be even greater. Maybe, or maybe not.
The enviros insist that the greatest challenge facing Vermont is The Menace of Global Warming. A far more serious challenge will be the capture of public policy by a well-organized and well-funded movement eager to seize upon an imagined climate crisis as the excuse for enacting the entire enviro agenda, regardless of what it might cost the taxpayers, and regardless of how their Green Regime might overpower our local communities and diminish our freedoms.
The Statehouse Polar Bear Pageant
Last week saw some political pageantry on the statehouse lawn. The occasion was the legislative session to override Gov. Jim Douglas’s veto of H.520, Sen. Peter Shumlin’s bill to battle the Menace of Global Warming. The statehouse carnival was orchestrated by the Vermont Public Interest Research Group (VPIRG), who Sen. Shumlin represents in the upper chamber. The override effort failed; the House majority fell 13 votes short of the required two thirds.
The pageantry on the lawn and in the halls featured Middlebury College’s noted climate activist in residence Bill McKibben, plus a VPIRG functionary prancing about in a polar bear costume, bearing a sign reading “Why doesn’t the Governor love me?”
The cuddly, lovable polar bear has become the political symbol of the global warming alarmist crowd. To them, Gov. Douglas’s veto of a bill tripling the tax on Vermont’s cleanest electrical energy plant to finance $25 million worth of advice to fuel users is tantamount to consigning our grandchildren, in Sen. Shumlin’s memorable phrase, to a future “unspeakably horrid.”
Left out in the pageantry were the baby seal people. Twenty years ago, before the Menace of Global Warming, they were riding high in their campaign to stop the killing of cuddly baby seals by brutal men with clubs. You’d think they would be out clamoring in support of the alleged demise of polar bears that brutally feed on baby seals. But strange to say, they seem to have morphed into polar bear protectors.
It’s worth taking a closer look at the “majestic polar bear”, as Greenpeace describes this savage 1200-pound carnivore. The global warming alarmists demand that we “cut global warming pollution” (sic) because the polar bear is threatened by receding ice packs in the Canadian Arctic. There are a few false notes about this story.
It began with a widely disseminated Associated Press photo of three polar bears “stranded” on an ice floe. Al Gore declared that these animals were “literally being forced off the planet.”
Research by the Australian TV network ABC turned up some interesting facts. The photo was actually taken over two years earlier, by an Australian marine biology student named Amanda Byrd, in August, at the height of the Arctic summer. Said Ms. Byrd, when queried later, “They did not appear to be in danger… I cannot say either way if they were stranded or not.”
Denis Simard, a bear expert at the Canadian equivalent of our EPA, said, “the bears are not in danger at all. They were not that far from the coast, and it was possible for them to swim. They are still alive and having fun.”
Dr. Mitchell Taylor is a Canadian biologist who has spent twenty years wandering around Nunavut checking up on polar bears. In testimony to the U.S. Fish & Wildlife Service, Taylor said that modest Arctic warming may benefit the bears since it creates better habitats for their main food sources. Where bear numbers and weights are declining, Taylor says, warming isn’t the cause. It’s too many bears competing for food.
On the other hand, a report from an international group called the Arctic Climate Impact Assessment claims “global warming could cause polar bears to go extinct by the end of the century.” But the group’s own report shows that the Arctic temperature was higher in 1940, well before the surge in industrial carbon dioxide emissions that so terrifies McKibben, Gore, Shumlin, and VPIRG.
The ACIS report says that 200 years worth of manmade greenhouse gas emissions have produced a 0.6 degree C increase in average global temperature, and that Arctic temperatures seem to change in 40-year cycles unrelated to carbon dioxide emissions. This pretty much undercuts the concern expressed in the group’s press release.
Biologist Taylor says that polar bear numbers are increasing worldwide. An aerial survey of Alaskan polar bears in 2003 reported more bears than any previous survey since 1987. Another study of the Davis Strait population reports that it has increased from 850 in the mid-1980s to 2,100 today. Inuit hunters concur, and three villages have sought permission to shoot more bears because they are prowling into the villages.
But never mind all that. The Menace of Global Warming, like a bad B movie, isn’t about science or truth. It’s about generating enough public hysteria to justify putting governments in charge of taxing and rationing all human energy use and thus controlling the world’s economy.
Some gullible Vermonters will fall for VPIRG’s image of the cuddly polar bear, and keep on clamoring for Sen. Shumlin’s legislation. Hopefully, a majority will soon come to recognize this scam for what it is.
Sen. Shumlin’s Desperate Search for New Taxes
A shabby, desperate attempt to find something new to tax is now playing itself out in Montpelier. The principal actor is the Senate president pro tem, Sen. Peter Shumlin.
As every legislator who campaigned last fall well knows, the number one issue afflicting Vermonters all across the state is the rising cost of public education. Those rising costs translate into rising property tax rates. The people demanded action.
But Sen. Shumlin opened this year’s legislature, not with a focused effort to deal with education costs, but with two weeks of “seminars” on the menace of global warming. Once everyone was suitably indoctrinated in the urgent need for action to save the planet from Al Gore’s heat death, Sen. Shumlin planned to push through the sweeping environmental program of the Vermont Public Interest Research Group, VPIRG.
There were several key ingredients in the VPIRG anti-heat death program. One was to get people out of big, gas-consuming vehicles. That was the rationale for a $150 surtax on the purchase of minivans, SUVs and pickup trucks, coupled with a subsidy for the purchase of upscale hybrids for people who can afford $35,000 cars, plus little teeny-weeny cars for everybody else. That scheme collapsed in mid-April when even enviro Democrats were too nervous to do it.
Another key ingredient was creating a permanent “efficiency utility” to explain to businesses and homeowners how to get by using less heating fuels. This “thermal efficiency” program was to be paid for with a new tax on heating oil, propane, and natural gas. That scheme – deceitfully labeled a “heating fuel savings charge”- crashed when people who heat their homes and businesses found about it.
By late April the senator from VPIRG was getting desperate to find new tax dollars to fund his environmental initiatives. So he turned to a favorite shakedown target that, unlike car owners and heating fuel users, doesn’t have a vote: Vermont Yankee. Sen. Shumlin also represents Windham County. Hitting Vermont Yankee with a new tax is popular with that county’s anti-nuclear activists who rightly view him as their favorite politician.
Recall that in November 2003, in return for Public Service Department support for its application to the Nuclear Regulatory Commission for a reactor power uprate, Entergy, the owner of Vermont Yankee, agreed to pay the state $7.8 million to clean up algae in Lake Champlain, 180 miles away, plus $2.1 million to pay for more low income home heating assistance. (The Public Service Board later decided that funding algae cleanup was inappropriate, but diverted the money to other energy related projects.)
Two years after making that deal, Entergy sought regulatory permission to store spent fuel rods in concrete casks, instead of a cooling pool. “Aha!" cried the legislature. “Entergy needs another approval. Let’s make it pay us $4 million a year from now until 2012, and we’ll decline to object to how the plant stores its used rods (on its own property, at its own expense).”
So, to avoid a long and uncertain political and legal battle, Entergy, the state’s lowest cost, most reliable energy producer, agreed to pay the state’s new Clean Energy Fund as much as $28 million over the next seven years. The state will use the money to subsidize VPIRG’s favorite renewable energy projects, chief among which are legions of already-subsidized 420-foot wind turbine towers marching along Vermont’s mountain ridges.
Now it’s 2007. The senator from VPIRG, observing that he was not a party to the 2005 agreement, proposes to tax the spent fuel rods that Vermont Yankee already agreed to pay $28 million for permission to store. He also proposes to impose a special tax on any revenues the company might make by selling on the spot market the 20% of its power not already under a long-term contract. This dishonorable stunt would shatter the 2005 agreement that Entergy, acting in good faith, thought it had sealed with its $28 million.
But on April 26th that scheme collapsed from legislative opposition (notably from the more conscientious Speaker Gaye Symington, who had been a party to the earlier agreement). So the senator from VPIRG proposed another even more far fetched new tax: a 35% tax on any “unanticipated revenues” that only one particular business – Vermont Yankee - might earn from selling its product. On May 1 the Senate bought Shumlin’s scheme on a 15-14 vote, with eight liberal Democratic senators as well as six Republicans voting against it.
Both the 2003 and 2005 deals between the state and Entergy are examples of government extortion. For enough protection money, the state agreed not to strangle Entergy’s plans to produce more cheap, dependable power and improve the management of its waste. This is just what any Mafia racketeer would do if he had the power.
That’s bad enough. But the senator from VPIRG has now persuaded the Senate to break the latest deal, and hammer Entergy again. Even the Mafia wouldn’t do that.
The New Tax for “Thermal Efficiency”
Relief is in sight for those Vermonters who, inexplicably, have never been offered a government program to “meet fully the thermal efficiency needs of consumers who rely on heating oil, kerosene, propane, and coal upon which no efficiency charge has yet been assessed.” At last the government will assist these consumers by taxing their heating fuel purchases.
First, a bit of background. In 1999 the legislature became disappointed with the power companies’ efforts to persuade their customers to stop buying their product. The legislature authorized the Public Service Board to contract with a company called Efficiency Vermont to explain to electricity users that saving electricity would reduce their electric bills, and the savings could pay for the energy saving improvements.
To obtain the needed funds for the “efficiency utility” program, the legislature authorized the PSB to tax everyone’s electric bills as much as it cared to. This it has cheerfully done ever since. The current take is $29 million a year, but the enviros want to increase the tax to extract $51 million.
Note that the 1999 legislature chose to delegate its constitutional authority to levy taxes to a three-member appointed board. That’s ingenious, because it allowed legislators to say, “Hey, I didn’t vote to tax your electric bill.” Yeah, right.
But until now the efficiency utility has done nothing to similarly benefit people who heat their homes with oil. This oversight will now be corrected by a bill now before the Senate (S. 94).
The bill authorizes the PSB to create an ‘expanded energy efficiency utility” to explain to Vermonters how not to use so much heating oil as well as how not to use so much electricity. And like the electricity scheme, the bill authorizes the PSB to levy another new tax on heating fuel to pay for this service. The new tax is in addition to the one half percent gross receipts tax on heating fuel enacted in 1990 to finance weatherization for low income Vermonters.
The bill also provides that the efficiency utility program will no longer be put out to bid. Instead, the PSB will just automatically give Efficiency Vermont as much money as it cares to, unless the utility misbehaves.
Last January Senate President pro tem Peter Shumlin responsibly observed that state government is spending too much, and has used up its capacity for taxation. Accordingly this bill, ardently desired by the people eager to use the headlong rush of Planet Earth toward Al Gore heat death as an excuse to grab millions in new tax dollars, carefully avoids any suggestion that the new tax is actually a tax.
No, it’s only a “heating fuel savings charge”. Heating oil consumers must pay it just as car and truck buyers must pay the purchase and use tax, hardware store customers must pay the sales tax, and restaurant-goers must pay the meals tax, but no, this not a tax.
In addition to deceiving the voters, calling this tax a “charge” is an attempt to finesse the problem of Ch. II Art 6 of the Constitution: “All revenue bills shall originate in the House of Representatives.” So although this bill will extract $5 million from Vermonters the first year, and more later, it is not a revenue bill. And Bill Clinton never had sexual relations with that woman.
The Senate tried this at least once before. In the 1972 debate over the bottle deposit bill, the Senate invented a one–year “litter levy” to raise money for recycling centers. When the Senate bill arrived in the House, constitutional objection was made. The House leadership conscientiously put the Senate’s tax provisions into a House bill. It’s not likely that this legislature, whose majority has shown little respect for the constitution, will be so conscientious.
This legislature’s favored tax-raising technique is to hype the menace of “global warming”, invent new spending and regulatory programs to combat this menace, authorize an unelected board to levy a new tax, label that tax a “charge”, ignore the constitution in a rush to get it passed, all the while declaring to taxed-out Vermonters that our state is at the end of its tax capacity.
This is a rush to more Big Government, premised on highly dubious science, and paid for by a tax deceitfully disguised as something else, all in violation of a plain provision of the Constitution. One would hope that Vermonters would demand better from their elected representatives.
Big Money from Big Wind
Suppose you wanted to make a bundle in the electric energy business in the little state of Vermont. How would you go about it? The old-fashioned way would be to generate electricity at a lower cost than your competitors. But forget that – too demanding. Here’s another way: get the federal and state governments to rig the deal in your favor.
A good time to begin would be 1980, just after Congress, egged on by liberals and enviros, enacted a bill called PURPA. Under PURPA, states were required to coerce their electric utilities into buying the electricity from small hydro plants, at prices based on the price of oil reaching $100 a barrel by 2000. With your hydro plant up and running, the utilities would have to pay you two or three times what turned out to be the spot market price.
With that money machine working for you, it would be time to look for greater rewards. That would lead you to Big Wind.
The technology is there. The current industry standard wind turbine has a rated capacity of 1.5 Megawatts, with blade tips reaching 330 feet above the base. (Even larger units are coming soon.) The windy ridgelines are there. And most importantly, the subsidies are there – lots of them.
First, a wind project owner can write off his capital costs from federal and Vermont taxes over five years. This rapid depreciation feature means that he can get back over half of the cost of the capital investment in two years. Not bad.
Then the federal government gives you a really nice bonus, a 1.9 cent credit for each kilowatt-hour produced. Hmmm, very good.
To top it off, the power you produce qualifies as “green power” and can be sold at a nice premium to utilities required to buy “renewable energy credits” by state-imposed “renewable portfolio standards” or state or regional “cap and trade” schemes.
To ease your path toward big profits, a friendly Governor like Howard Dean can get a $50,000 federal grant to underwrite an advocacy organization to peddle the merits of renewable energy, of which your variety will be by far the major beneficiary.
Through your generous support, you can get enviro groups like VPIRG to clamor for Big Wind. You can hire VPIRG’s executive director to be your chief political operative. You can even write a newspaper commentary explaining how welcoming industrial wind farms into Vermont is equivalent to earlier Vermonters’ demand for the abolition of slavery.
And there’s our wonderfully liberal legislature. There your friends can push through a “renewable portfolio standards” bill to require the utilities to buy your wind power regardless of its cost to the ratepayers (Act 61 of 2005). They can persuade the solons to extort $15 million from the state’s one dependable, efficient, but unpopular (with enviros) nuclear plant to create a “Clean Energy Development Fund” to subsidize among other things wind energy projects (Act 74 of 2005).
They can also make sure that the expected revenues from the Regional Greenhouse Gas Initiative are used to subsidize renewable energy causes like Big Wind, instead of just reducing everybody’s electric bills (Act 123 of 2006).
Even with all these successes, there are still some annoying obstacles. Lots of rural Vermonters don’t want to look at gigantic wind towers marching along their ridgelines – especially when tax incentives are the main reason for their being there. A PSB hearing officer recommends against the East Haven project because it would somehow detract from the eco-values embodied in the nearby Champion Lands. The Agency of Natural Resources objects to the effects of wind turbines on birds and bats.
But with the generous tax benefits, the utilities forced to buy your power at above market rates, the profitable market for selling “green power” credits to out of state utilities, and the prospect of handouts from the Clean Energy Development Fund and the RGGI program, winning the Big Wind game may still worth the political investment.
There is however one threatening idea to worry about. That is the idea of the state levying a 1.9 cents per kwhr tax on industrial wind energy production. That would neutralize the federal production tax credit incentive and make wind projects compete in the energy marketplace. That would bring Big Wind down overnight. But maybe no one will think of it.
The Regional Greenhouse Gas Scam
One of the most intricate and ingenious scams ever conceived by state governments is marching forward in Montpelier, well under the radar.
Like all such scams, certain favored interests will make good money off of it. If you are unlucky enough not to be such a favored interest, you will pay. This particular scam is called the Regional Greenhouse Gas Initiative (RGGI).
In perhaps his last gift to Vermont, Gov. Howard Dean in August 2002 signed an executive order pledging Vermont to cooperate with other states in the region in a scheme to reduce carbon dioxide emissions by an astonishing 75% by 2050 (“if practicable using reasonable efforts”). Gov. Douglas replaced that order a year later, but retained all of its enviro theology and emission targets.
The focus of RGGI is carbon dioxide emissions from power plants. This is not power plant pollution, caused by sulfur dioxide and particulate emissions. Those are already under fairly strict EPA regulation. Carbon dioxide is the result of carbon fuel combustion. It becomes a vital feedstock for crops and forests essential to the Northeast’s economy.
For the past decade an astonishing coalition of enviro groups has passionately advocated government taxation of carbon dioxide emissions. Why? Because they want more government control of our energy-based economy. Because they want government to confiscate more of people’s incomes, to be showered as subsidies on their favorite industry, “renewable energy”. But since these candid arguments won’t sell politically, the enviros have wrapped their advocacy around the supposed perils to humanity of “global warming”.
Here’s how the argument comes together. “Global warming is a mortal threat to the future of the human race! People – not dear old Mother Nature – cause global warming by burning carbon, thus emitting the evil greenhouse gas carbon dioxide.”
“So the government must force us to cut back our carbon dioxide emissions. Since that nitwit Bush won’t impose carbon controls from Washington, a bunch of states in a region like the Northeast must get together and do it. They’ll require their coal, oil and gas-fired power plants to buy emission tickets. That will make those fuels more expensive, the electric ratepayers will pay higher prices, and big money will turn up in government coffers.”
The RGGI scheme distributes the emission tickets among the state governments that thought it up. This is like printing monopoly money, and requiring energy generators to buy it with real money. Where will they get the real money? By increasing the price they charge for electricity. And who pays that price? Energy intensive industries like IBM, OMYA, and the Vermont ski industry, plus Joe’s Machine Shop, Farmer Brown, and Aunt Maude.
The energy tax and price effect was candidly conceded two years ago by a leading advocate, Marc Breslaw of the Massachusetts Climate Action Network. “We want to start off with a modest program,” he said, “so we don’t raise the price of electricity too much and freak everyone out, and have them say this is a bad idea.”
Since Vermont has only one very small part-time oil-fired power plant (in Berlin), the state government will pocket all of the proceeds from selling its emissions tickets to power plants located elsewhere in the Northeast. The prices paid by Vermont consumers for carbon-fired electricity will rise slightly, and the money from auctioning off the emissions tickets will come pouring in from non-Vermonters. Free money!
So what will the state of Vermont do with this new money? The legislature addressed that question in a House-passed bill (H. 860) that is awaiting certain Senate approval. It directs the Public Service Board to use the RGGI windfall funds to make “energy efficiency and other low carbon power system investments”. That will almost certainly work out to finding even more ways to subsidize wind farms and methane generation from manure and landfills.
If one is not too picky about using junk science theories of “global warming” to extract more tax dollars, one can defend Vermont’s participation in this scam by pointing to the “free” revenue flow into state coffers. That said, the only question then is how to best to spend the money.
Here’s an idea. The Public Service Board is already extracting $18 million a year from electricity ratepayers to finance “Efficiency Vermont”. So in 2009 when the “free” RGGI emissions tax money starts rolling in, the PSB could use it to offset or eliminate the tax on everyone’s power bill.
Will the PSB do that? Certainly not, unless forced to by the legislature. And the legislature won’t do that, because the majority is eager to generate a new pot of money to shower more corporate welfare on their friends in the “renewable energy” business, notably industrial wind farms. No wonder that VPIRG, the most vocal backer of heavily subsidized wind farms, is an equally vocal backer of the RGGI scheme.
As Sir Walter Scott once observed, “Oh, what a tangled web we weave, when first we practice to deceive.”
New State Revenue Technique: Simony
Pope Gregory VII remains a towering figure in Roman Catholic Church history today, because of two major accomplishments. One was creation of the Council of Cardinals to choose new popes. The other was a ban on simony.
Simony was the practice of churchmen selling ecclesiastical favors, notably indulgences. Indulgences were the “get out of jail free” card of the medieval Monopoly game. The difference is that in today's Monopoly you have to draw the card. In the Church, you had to buy it from a priest or bishop.
Gregory saw that this practice was corrupting the Church, and decreed an end to it. By the 16th Century his prohibition had lost some effect; simony was a major complaint behind Martin Luther’s protestant rebellion.
Why is this of any current interest? Because the Vermont legislature has hit upon the practice of simony as a new way of extracting sums from sinners (and fatten the state’s coffers.)
The run up to the present practice began in the early 1990s. The environmental regulators seized upon the idea under the guise of “mitigation.” The Environmental Board or the Agency of Natural Resources would identify a heretofore unsuspected sin. It would then allow a permit applicant to commit the sin upon payment of an appropriate penance.
For example, a Barnet landowner was required to preserve a reputed deeryard as the price of extracting gravel from a gravel bank. A Kirby business was required to build earth berms between his truck yard and the Moose River as the price of getting an Act 250 permit. Bonneville Pacific in East Ryegate was required to buy the development rights to 14 acres of farmland far away from its power plant to atone for making use of 14 acres of abandoned farmland adjacent to the plant.
These instances did not however exhibit full-fledged simony. The penitents were required to spend money, but the state environmental priesthood that mandated the spending did not enrich itself with the proceeds. That had to wait until 2003, when Entergy Nuclear Inc., new owners of the Vermont Yankee power plant, applied for permission to increase the plant’s energy output, and to store used fuel rods in dry casks instead of in pools.
A lawyer’s error in the transfer of the nuclear plant to the new owner was interpreted by the state to mean that Entergy had to apply all over again for what its predecessor company was entitled to. “Aha!”, cried state officials and legislators. “Now Entergy needs permission! Entergy has money! Before we give them permission, we shall make them give us their money, and we shall use it to our advantage.” An 11th century bishop could hardly have summarized it more concisely.
In November 2003, in return for Public Service Department support for a reactor power uprate, Entergy agreed to pay $7.8 million to cleanup algae in Lake Champlain, 180 miles away, plus $2.1 million to subsidize low income home heating. The deal was criticized not only by the anti-nuclear activists, but also by state Auditor Elizabeth Ready: “(Vermonters) health and safety could be placed at risk if utility regulation is allowed to become a pay-to-play endeavor, fueled by extracting millions from applicants for pet projects in order to get the Public Service Department’s stamp of approval.”
Now the legislature is about to pull the same trick again. It has discovered that storing used fuel rods in concrete and steel casks at Vernon is a sin that can be expiated only by the payment of more millions of dollars to the state. “Aha! Entergy needs permission! Let’s make a deal! They shall pay us another $2.5 million a year! We shall allow them to store their waste (on their own property, at their own expense), and we shall get to spend it!”
On what? To capitalize the favorite enviro-liberal corporate welfare program, a “clean energy fund”. Most likely, the state’s lowest cost, most reliable, and least conspicuous energy producer will be hit up for as much as $28 million to subsidize the corporate owners of legions of 220 foot wind turbine towers marching along Vermont’s mountain ridges.
It’s time to call this scheme for what it is. It is simony, the selling of indulgences by a political priesthood as ethically compromised as the priests who aroused Martin Luther’s ire at Wittenberg in 1517. This legislative extortion is not to offset the public costs of dry cask storage, which are essentially zero. It is extortion to subsidize the politically correct “renewable energy” industry that will never come anywhere close to replacing the dependable electric energy generated at Vermont Yankee, and which would scarcely exist at all but for the life support of Federal production tax credits.
Where is Pope Gregory when we need him?
Pay More for Electricity!
Surprisingly, there are some people in the state of Vermont who believe that Vermont industries, small businesses, farmers and homeowners aren't paying enough for their electricity. Even more surprisingly, 24 of these people currently inhabit the Vermont Senate. Their most recent handiwork was the approval, by a 24-3 vote on February 23, of the Renewable Portfolio Standard (RPS) bill (S. 52).
The RPS bill says that no Vermont utility can sell less renewable energy in any future year than it did in the 1995-1997 base period. Further, starting in 2013 each utility has to sell as much renewable energy as its load growth between now and then.
What is renewable energy? It is basically any electricity that does not come from coal, oil, natural gas, nuclear, or waste incineration. So that means wind, solar, tides, landfill and cow barn methane, wood chips, and hydro, right?
Not quite. Under a law passed in 2003, hydroelectricity is "renewable" only if it comes from facilities of less than 80 megawatts capacity. Little hydro is renewable, big hydro somehow is not. Why the distinction? Because if hydropower from HydroQuebec's huge facilities at James Bay and Churchill Falls is counted as "renewable", Vermont would already be among the nation's most "high-renewable" states. Then the enviros would have to find some other argument for inflicting their preferences on everybody else.
The problem with the RPS requirement is that "renewable energy" almost always costs more than the market price for electricity - sometimes twice as much. To increase sales of renewable energy to meet load growth, electric utilities will almost certainly have to buy higher priced electricity. Since utilities pass their higher costs on to consumers, it is consumers who must ultimately pay for the higher cost of renewables.
The difference in cost between market-priced power and renewable-mandated power will simply be corporate welfare for the renewable energy industry, notably the subsidy-sucking wind turbine promoters eager to send 220 foot towers marching down various Vermont ridgelines
Thus the RPS bill mandates that utilities market more expensive electricity instead of less expensive electricity. One would think that the Senate would have found a really compelling reason for mandating higher electricity costs. Alas, an examination of the findings in the bill is somewhat depressing.
The bill earnestly declares that its enactment will "ensure that to the greatest extent possible the economic benefits of renewable energy in the state flow to the Vermont economy in general, and to the rate paying citizens of the state in particular." This requires one to believe that "economic benefits" will flow from consumers paying more for their electricity. This is not at all obvious. Nor is it obvious that any conceivable switch to renewables will "contribute to reductions in global climate change."
There is much more in the bill than just requiring utilities to sell higher priced electricity. It plans to ban the sale of a wide range of electrical items deemed energy inefficient as soon as enough other northeastern states can be persuaded to adopt the same efficiency standards. Violators will be sniffed out through periodic government inspections, and fined $250 per day per violation until they cease sinning against the planet.
This brings to mind the infamous Act 259 of 1992 - happily never enforced - that would have hired a roving state bulb inspector to get injunctions and fines against the users of contraband fluorescent light bulbs.
There's also a thought-provoking provision that allows utilities that suffer reduced sales because their customers reduce usage through conservation to increase their rates so they can remain fiscally solvent.
One would have thought that some Senator, heeding the voice of Vermont companies like IBM whose competitive position is threatened by its high electricity bills, would have moved to strike the 80 megawatt hydro restriction. At one stroke that would have made Vermont the renewable energy model for the nation. None did. Just before passage Sen. Ann Cummings (D-Washington) tacked on an amendment raising the 80 Mw to 200 Mw - high enough to let in energy from Connecticut River hydro dams, but not high enough to include power from HydroQuebec.
Last year the Republican-controlled House buried a Senate-passed bill with the RPS requirement. This year's House will certainly pass S. 52. Gov. Douglas has announced his opposition to the high-cost RPS mandate. Let's hope there are enough legislators in the House to sustain his veto.
Senate Votes for Higher Electric Bills
This year’s Big Idea for energy policy can be summed up this way: ratepayers aren’t paying enough for electricity, so state government needs to make it more expensive. That, in translation, is the argument that persuaded 24 senators to vote on February 26 for the “renewable portfolio standard” (RPS) mandate (S. 261).
The RPS mandate says that first, no Vermont utility can sell less renewable energy in any future year than it did in 1995-1997. More importantly, in 2013 an amount equal to all of each utility’s additional energy sales between now and that year must come from renewable sources.
Why is it necessary for the state to force utilities to buy more renewable source energy? Because utilities naturally buy the cheapest power they can find, and renewables are not the cheapest. They are almost always the most expensive.
The bill defines renewable energy basically as energy that does not come from coal, oil, natural gas, or nuclear. So that must mean solar, wind, landfill and sewage plant methane, wood chips, and hydro, right? Not quite.
The bill reiterates the language of last year’s Act 69 that only hydroelectricity that comes from facilities of less than 80 megawatt capacity qualifies as “renewable”. There’s an important reason for this arbitrary restriction.
The 80Mw cutoff naturally includes all the small hydro dams in Vermont and on the Connecticut River. What it excludes is electricity from the giant HydroQuebec plants at James Bay and Churchill Falls, Quebec. Why? Because if the electricity from the big HQ dams is recognized as “renewable”, Vermont would already be getting fifty percent of its power from renewable sources, making it among the “greenest” energy states in the nation.
Then there wouldn’t be any reason to have a renewable portfolio standard. So the renewables advocates simply defined HQ power out of the calculation.
There is one straightforward way to get Vermont utilities to buy more qualified renewable energy. That is to find it on the market at a price lower than “conventional” energy (nuclear, fossil fuels, and HQ hydro). Utilities would run to sign up for any such lower cost power. Unfortunately there isn’t any, and there’s not likely to be much of it for a long, long time.
That being the case, the RPS bill simply mandates that the utilities buy more expensive electricity instead of less expensive electricity. The utilities, of course, pass the extra cost on to their ratepayers, as allowed by the Public Service Board.
IBM, the state’s largest private employer and largest user of electricity, has been outspokenly opposed to any mandate that forces it to pay more for its power. Since 1990 Vermont electricity consumers have paid over $2 billion more than they would have paid for electricity at U.S. average rates. This is a major burden on homeowners, small businesses, schools, hospitals, ski areas, and local governments, but it’s especially threatening to Vermont manufacturers whose products must be sold in a global market.
The renewables political game is to use the government’s power over the utilities to force them to buy power from politically favored independent sellers. Those sellers produce electricity from solar, wind, minihydro and other marginal technologies.
Vermont already had some very bad experience with this kind of corporate welfare game. A 1978 Federal law called PURPA required Vermont utilities to purchase power on long-term contracts from a dozen small hydro plants and one big woodchip plant (Ryegate). The government calculated the contract price on the prediction that fossil fuel prices would reach $100/barrel of oil equivalent. (Even with two decades of dollar depreciation, oil is now around $32/bbl). That’s why IPP power (8% of Vermont’s consumption) is the most expensive part of every utility’s portfolio.
So the RPS bottom line is this: 24 senators were pleased to pass legislation to require Vermont utilities to charge higher electricity prices to businesses, farms, schools, local governments, and ordinary ratepayers, all to benefit a handful of politically active entrepreneurs whose more expensive product would find few buyers in a free marketplace without government compulsion.
Like the costly IPP experience, this is, once again, renewable corporate welfare. It would be gratifying if the many House liberals who regularly – and rightly – decry corporate welfare would show enough spunk to act on their principle, and turned thumbs down on this latest example.
Sorrell’s Carbon Dioxide Lawsuit
Hey you! Quit exhaling! You’re melting the polar ice caps!
That’s the message, at least in principle, that the federal Environmental Protection Agency could be sending if Vermont Attorney General William Sorrell gets his way.
Sorrell has signed the state of Vermont onto a lawsuit against the EPA brought by Massachusetts and nine other states. Its purpose is to force EPA to declare carbon dioxide to be a “pollutant”, and subject it to strict regulation and control under the Clean Air Act.
It’s important to understand the politics of this issue. The Clinton administration was eager to expand national and international controls over fossil fuel combustion. President Bill Clinton had an urge to regulate anything and everything within the government’s reach. Vice President Al Gore had made a huge political investment in combating the supposed menace of “global warming”.
So Clinton and Gore pushed for ratification of the UN’s Kyoto Protocol, to create a treaty-mandated tax and control regime over fossil fuel use, and thus economic growth, by “developed” countries, while exempting “developing” countries like China, India, and Brazil. That train was derailed by a labor-backed 95-0 U.S. Senate vote in 1997 that denounced any protocol containing a Third World exemption. (Sens. Leahy and Jeffords voted Yes.)
With the Kyoto strategy sinking, Clinton-Gore got the idea of declaring carbon dioxide a “pollutant”. As such, the EPA could regulate it under the Clean Air Act along with harmful things like sulfur dioxide, nitrogen oxides, ozone, and hazardous chemicals. So in 1998 the then-counsel of EPA dutifully declared that carbon dioxide was indeed a “pollutant” subject to EPA regulation.
After some fumbling the Bush administration, which does not support the Kyoto Protocol, reversed that opinion. This action on August 28 is what set off the attorneys general and their partners like the Sierra Club and Natural Resources Defense Council.
Sorrell and his colleagues have filed a petition for review in federal court to force the EPA to go back to the Clinton-Gore position. If the court buys the argument, the door would be open to EPA regulation of power plants, industries, cars, snow machines, lawnmowers, chain saws, brush pile burning and other sources of carbon dioxide emission.
Unlike the EPA regulations on sulfur, nitrogen oxides, ozone, and hazardous chemicals, regulating carbon dioxide emissions has nothing whatever to do with protecting human health and welfare. It’s all about protecting Mother Earth against “global warming”. The argument is that human production of “greenhouse gases” like carbon dioxide is causing potentially catastrophic “global warming”. As Sorrell’s assistant AG for environment states it, “there is no longer any reasonable dispute among the scientific community as to whether or not anthropogenic [i.e. human-caused] CO2 emissions are warming the climate.”
This is enviro bunk. There is a large and accumulating body of evidence, supported by thousands of scientists, that human contributions to naturally occurring global temperature change are insignificantly and probably indetectably small. There is also accumulating evidence that the United Nations climate study body has been doctoring the data and creating computerized “global warming” scare scenarios, to frighten national legislatures into ratifying the Kyoto Protocol. But without a “global warming” hysteria, the Clinton-Gore-UN-Sorrell idea of strict government control over carbon dioxide emissions- that is, over energy usage and thus economic growth - is a dead duck.
Furthermore, Congress has never conferred any conceivable authority upon EPA to impose controls over carbon dioxide production. Starting in 1990 enviro legislators – notably including Leahy and Jeffords - have made several attempts to confer such authority, and every effort has decisively failed.
The current AG’s lawsuit is built on junk science in the service of partisan politics. How much Vermont taxpayers are spending to make their attorney general a player in the national enviro lawsuit game is not readily available, but anything is too much.
Vermonters would be much better off if their attorney general confined himself to supervising the state’s legal business. That was what attorneys general dutifully did until 1966, when one after another of them started using their office to try to propel themselves into higher elective office. (Only Jeffords, after two years out of office, finally succeeded.)
The straightforward solution is a simple statute to authorize the Governor to appoint the attorney general, subject to confirmation by the Senate like a cabinet officer. That would end the temptation of ambitious attorneys general to use their office as a taxpayer-financed public interest law firm.
On August 26 New England’s Governors will meet with their Eastern Canadian counterparts in Quebec to agree to force on their states and provinces a sweeping environmentalist agenda founded on a ridiculous lie. That lie, diligently promoted by enviro groups, is that our planet is experiencing dramatic warming caused by human activity – namely, burning carbon fuels to produce energy.
The governors and premiers have already bought this line. In the words of the Action Plan they adopted last year, “average rates of warming by 2100 will be greater than any seen in the last 10,000 years. Such instability will increase the incidence and severity of extreme weather events such a storms, droughts, floods and heat waves; cause sea levels to rise, shift and or expand certain disease or pest vectors; and further stress already vulnerable species and ecosystems.”
So at their August meeting they will put their signatures to Resolution 27. It will commit their states and provinces (by what authority?) to reduce their greenhouse gas emissions (principally carbon dioxide) to 75% below current levels.
How will they do this? By imposing the entire enviro agenda: Stop their utilities from buying fossil fuel-produced electricity. Subsidize or require “renewable energy sources”. Cap industrial energy use by enforcing “cap and trade” allocation permits. Crack down, through regulation or taxes, on people buying SUVs and pickup trucks. Force the adoption of “smart growth” zoning codes to produce dense, congested urban centers. Spend millions of taxpayer dollars on supposedly energy efficient mass transit, like the celebrated Champlain Flyer. And this is only a sampler.
The rationale for this sweeping government action to force the enviro agenda on everybody else is not that it would be cost-effective, since rational people and businesses have long been taking cost-effective steps to reduce energy expense. The rationale is simply that “We despicable humans are cooking our planet and our governments must stop us!”
What we know about global climate change is this: Human produced greenhouse gases constitute less than two percent of total greenhouse gas emissions. The human contribution is dwarfed by natural water vapor, clouds, forest fires, and methane produced by cows and termites. Carbon dioxide concentrations have risen from 280ppm in 1900 to 360ppm today. But global temperatures rose steadily until 1940, then went back down for 40 years (in the late 1970s scientists were predicting a new Ice Age), and then started to slowly rise again at the rate of three quarters of one degree F per century. No real scientist would conclude cause and effect from this data record.
NASA’s very accurate lower troposphere satellite temperature record has been available since 1979. It shows virtually no increase in global temperatures, other than the 1998 El Nino spike which is not related to the supposed global warming phenomenon. What little temperature increase has occurred has been mainly at night, in winter, in high latitudes.
The enviro “evidence” for “global warming” is based on two UN IPCC computer simulations. However these programs completely fail to reproduce the known temperature history of the past, and are therefore worthless. In addition, the government-influenced IPCC public relations flacks have shamefully misrepresented what its scientists actually said, and have promoted ridiculous “scenarios” predicting climate catastrophes by 2100.
The enviros’ favorite remedy for this nonexistent threat is the UN-instigated Kyoto Protocol. This agreement, signed by President Clinton but spurned by a 95-0 vote of the U.S. Senate, would allow the Third World to combust unchecked, while the industrialized countries shut down their coal-, oil-, and gas-based industries. Even the otherwise liberal AFL-CIO has gagged on this scheme to transfer American jobs to Brazil, India, and China.
There are some desirable “Action Items” in the governors’ “Little Kyoto” program. It calls on state governments to become more energy efficient (better insulated buildings, higher mileage vehicle fleets, more telecommuting, etc.) and thus save taxpayer dollars. On the other hand, it directs governments to “develop coordinated outreach programs for schools”, to brainwash the next generation with politicized, enviro-falsified “global warming” science, instead of helping them to understand real science.
How fine it would be if Vermont had an independent-minded Governor with the brains and courage to go to Quebec, lay out the real science, scorn enviro-falsified scare scenarios, defend the freedom of his state’s people to make their own decisions about energy use and cost effectiveness without heavy handed government controls and mandates, and get in his taxpayer-friendly 52mpg Toyota Prius and drive back to Montpelier.
None of those things are likely to happen this month.
Renewable Corporate Welfare
For the past year Vermonters have been the target of a sophisticated full court press by one particular for-profit industry. It's an industry that does not now enjoy a strong and lucrative market. And so, naturally, the people who own the companies involved want the government to fix a deal for them that will make them rich.
There's nothing new about manipulating government to enhance private profit. Economist Adam Smith noted it disapprovingly in The Wealth of Nations (1776). What's interesting about the current Vermont push is that it comes from a young industry trying into get its snout into the trough for the first time. The new entry is the renewable energy production industry.
The drive began a year ago. Newspaper readers noted a steady, organized drumbeat of letters to the editor. In October there was a statehouse conference on "sustainable energy". At this daylong event the sponsoring Vermont Sustainable Energy Coalition presented its manifesto. It was replete with recommendations to jump-start the fledgling renewable energy industry.
Now that effort is about to pay off for its promoters. By a 27-1 vote the Senate has passed a bill (S. 264) containing much of what the industry has asked for. If the House follows suit, these particular corporate interests will enjoy a well-earned celebration, as well as a stream of future profits.
The bill would do some useful things. It would allow electric customers to arrange to buy electricity generated by wind, solar, hydro, or sewer gas, paying the extra cost out of their own pockets. It authorizes home and farm generators of renewable energy to sell their excess electricity to the utilities through reverse metering. So far so good.
Now comes the beef. The bill requires the big utilities to supply to their customers a government-specified percentage of energy produced by the renewable energy industry. This is explicitly to ensure that industry a big enough market share to make it commercially viable. In other words, the promoters of the bill want the government to give them a guaranteed cut of the electricity action, at ratepayers' expense. Very nice.
There's more. The bill appropriates $750,000 to allow the Public Service Department to subsidize the customers of the renewable energy industry. This funding was urged by Gov. Dean in this year's state of the state address. Lt. Gov. Doug Racine, even more enthusiastic, has advocated switching budget money from economic development programs to support "sustainable energy".
Obviously $750,000 is not enough to underwrite the renewable energy industry, but its salespeople can certainly make good use of it to install their solar panels and windmills cheap at the homes of their friends.
The campaign for "sustainable and renewable" has many appealing arguments. Energy conservation can provide significant cost savings, as every homeowner and businessperson ought to know. The point of the present campaign is wave the "sustainable and renewable" flag to mesmerize legislators into putting the power of the government at the service of a relatively small number of people eager to make money.
It's an admirable thing when entrepreneurs take a product or service to market, satisfy customers, and make money. These renewable energy folks, however, want the government to force utility ratepayers to buy their more expensive electricity. They want the government to take other people's tax dollars and give them out to selected homeowners who will then buy the higher cost renewable product.
Every industry, including the renewable energy corporations, can plausibly claim that their profit-making activities offer some public benefit. When they demand that the legislature rig deals and hand out subsidies to benefit a favored few, the duty of legislators is to resist their special pleadings. Twenty-seven of 28 Senators, seemingly transported by the "renewable and sustainable" dream-weaving, flunked that duty.
House members need to see the corporate welfare part of this bill for what it really is, and earn a passing grade by saying no.
Vermont’s Debt to Nuclear Power
“Vermont, “ writes William Tucker in the May/June issue of The American Spectator, “is the East Coast’s answer to Ecotopia”. The reference is to a popular novel of the 1970s describing life in a fictitious environmentally correct state in the Pacific Northwest.
Tucker writes of Vermont’s advanced environmental practices: energy conservation, recycling, clean air, secondary sewage treatment, development rights purchase, eco-tourism, and organic farming. “The engine that keeps this Ecotopia running,” he notes, “is nuclear power.”
This is doubtless a very distasteful reminder to Vermont’s anti-nuclear enviros (essentially all of them), but documentably true. “An amazing 70 percent of the electricity generated in Vermont is nuclear,” Tucker observes, “ the highest proportion of any U.S. state. Reliable Vermont Yankee’s reactor in Brattleboro [actually, Vernon] supplies a third of Vermont’s own power and exports the rest to neighboring states.”
“Coupled with cheap hydroelectric power from Quebec, this enables Vermont to keep its lights lit, yogurt cold, and computers humming, while burning almost no coal, oil or natural gas to generate electricity.”
One would think this would thrill environmentally concerned people. For thirty years the Yankee reactor has been quietly humming along, delivering a reliable 540 megawatts to New England’s grid. No smoke. No ashes. No noise. No acid rain. No coal trains, pipelines or barges. No limestone scrubber sludge. Just cheap, dependable kilowatts.
Ah, but wait: what about the dangerously radioactive used fuel rods? They are safely cooling in pools at the plant, awaiting the long-overdue completion of the federal government’s multi-billion dollar storage cave under Yucca Mountain, Nevada. (In 70% nuclear France, used fuel rods are reprocessed into new fuel, but enviro opposition has made that useful alternative impossible in this country.)
If nuclear power is so dependable, cost effective, and benign, why hasn’t there been a steady growth in nuclear plant construction? Especially when new nuclear plants would free us from dependence on petroleum imports from dangerous and unstable places?
Fifty years ago the nascent environmental movement welcomed the age of “the peaceful atom”. Within a few years the movement changed its mind and began to wage unremitting war against anything nuclear.
Nuclear energy is necessarily produced by large utilities and large corporations like Entergy, the prospective purchaser of Yankee. Enviros, who dislike capitalism on a scale larger than that of the village blacksmith, have a problem with that. They also dislike Big Technology generally. And they have managed to terrify themselves and the public generally at the thought of any exposure to radiation, even at levels far below what Vermonters get from living on top of uranium-rich Green Mountain granite.
The Three Mile Island accident in Pennsylvania in 1979 was a godsend to the antinuclear movement. However the TMI bottom line was that five people died from heart attacks and accidents brought on by media-induced stress and frantic (and needless) evacuation. Zero people died, and zero were injured, by the accident itself. Dozens of people also died in accidents while mining, moving, and burning the coal used to replace TMI’s lost megawatts. What was learned at TMI has dramatically improved reactor safety in the years since.
Tucker analyzes the various enviro energy dreams, such as conservation, wind, solar, and fuel cells. All have some utility, but taken together those sources can’t come remotely close to what’s needed to power a modern energy-consuming society. Nuclear, Tucker concludes, “is mankind’s best energy hope”, and it will make a comeback whether the enviros approve or not.
Vermonters should make it a point to read Tucker’s convincing article. While they‘re at it, they ought to give thanks to the far-sighted people who built Vermont Yankee, and also to those who are leading the new wave of clean, cheap and environmentally friendly nuclear technology.