Posted: 07/28/2005
Special Interests Drive Energy Bill
NCPA E-Team Scholars Say Bill Provides Little Help to Consumers
DALLAS (July 28, 2005) – Compromise national energy legislation due for a vote in Congress before week’s end is a good bill for special interests but not consumers, according to scholars with the NCPA’s E-Team project.
“This is not meaningful legislation; it is loaded with pork barrel and special interest projects,” said NCPA Senior Fellow H. Sterling Burnett. Rob Bradley, E-Team Adjunct Scholar and President of the Institute for Energy Research, agreed. “The legislation represents a transfer of wealth from taxpayers to energy producers,” he said.
Bradley noted, however, that “There are some free-market reforms and nods to the supply side that will help consumers over time.” And E-Team Adjunct Scholar and President of the Science and Environmental Policy Project S. Fred Singer said, “There are a few nuggets of sensible legislation in the areas of nuclear energy and electric power.”
But there are a lot of subsidies in the bill, most notably for ethanol production and renewable energy sources, such as wind and solar power. “The good news is that the Soviet-style quota known as the Renewable Portfolio Standard is out. The bad news is that the Soviet-style quota known as the ethanol mandate is in,” said Marlo Lewis, E-Team Adjunct Scholar and Senior Fellow for Environmental Policy and the Competitive Enterprise Institute.
“Ethanol is pure pork,” Burnett. “It doesn’t pay its way.” He also noted that the provision for renewable energy sources in the bill is consumer-hostile. “They’re not competitive without tax credits,” he noted, “and taxpayers shouldn’t have to foot the bill.” Burnett also noted that the provision for wind power is neither viable nor economically sound. “The bill is a sop to the green lobby,” he said.
Singer noted that subsidies for purchases of hybrid cars “will end up mostly with Japanese producers,” rather than consumers. He also explained that the bill ignores several important energy needs, such as “sensible expansion of oil and gas leasing, refinery construction, and protection for MTBE manufacturers from avaricious trial lawyers.”
Burnett and other E-Team scholars said that in the final analysis the bill puts special interests ahead of consumers’ interests. “Thirty years of subsidies haven’t worked,” Burnett said, “let the market do it.” Singer added, “The bill should be vetoed, but probably won’t.”