Posted: 11/18/2004
Regional Climate Change Proposals: High Costs For No Gain
NCPA Report Examines Common Flaws Among Efforts to Reduce Greenhouse Gas Emissions
November 18, 2004 – Abandoning hope that the Kyoto international treaty on climate change will ever be adopted by the U.S. government, environmentalists have focused their energy on pushing a series of national and regional initiatives to reduce domestic greenhouse gas emissions. Yet according to a new report from the National Center for Policy Analysis (NCPA), none of these proposals would prevent climate change but each would come at a high economic cost. The NCPA analysis can be accessed online: Regulating Greenhouse Gas Emissions.
“All of these proposals have one thing in common, they would significantly raise energy costs,” said NCPA Senior Fellow H. Sterling Burnett, author of the NCPA report. “Unfortunately, the costs will not be equally felt. The poor and seniors on fixed incomes will feel the brunt of the higher costs as they spend a greater portion of their disposable income on food and fuel than the average household.”
In 2003, Senators John McCain (R-AZ) and Joe Lieberman (D-CT) cosponsored the “Climate Stewardship Act,” a bill to require greenhouse gas reductions from the commercial, industrial, utility and transportation sectors. The goal of the legislation would be to reduce emissions to 2000 levels by 2010, and to 1990 levels by 2016.
According to a June 2003 analysis by the U.S. Energy Information Agency of the probable economic effects of the bill found that by 2025:
- Gasoline would cost 40 cents more per gallon than it would otherwise.
- The average household would spend $444.00 more per year on energy, including a 46 percent increase in electricity prices.
- Gross domestic product would be $675 billion to $1.63 trillion lower, in present dollars.
In lieu of federal action, a number of Northeastern states – Connecticut, Delaware, Maine, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Vermont, and possibly Pennsylvania and Maryland – are considering both individual and coordinated policies to reduce greenhouse gas emissions. Their ambitious goal is to cut emissions to 1990 levels by 2010; 10 percent below 1990 levels by 2020; and by 75 percent to 85 percent of 2000 levels by 2050 – a 90 percent reduction over what they otherwise would be.
“Every economic sector – transportation, industrial, commercial and residential – would experience drastic energy reductions, imposing substantial costs on participating states,” said Burnett. “Drivers in those states would pay 61 cents more per gallon by 2010. Add the rise in electricity and natural gases prices by over a third, and the cost of just about everything will sky rocket in these states. It’s difficult to imagine a more disastrous economic initiative.” The NCPA report also noted that none of the state initiatives would have any measurable impact on future warming.