The Atlantic, Mark Arbinder

On cap-and-trade, one can make an argument that a downpayment in the budget would have been helpful to the administration. But the political reality is a standalone bill — which would include, as the President himself hinted last night, money to account for regional differences in energy production and measures protecting Americans from spikes in electricity bills — would have a better chance at passage. So far as I can tell, other major difference is that where the White House provided guidance about how to fund and structure a 10-year $684 billion health care reserve fund; Congress provides for a similar facility, but does not specify gross savings — the White House was more specific. Under both proposals, appropriations committees will be tasked with coming up with legislation that nets to zero. That’s kind of exactly what the White House had hoped for. A minor difference: the farm-state senators won’t go along with the President’s agriculture subsidy cuts.

[JR: They haven't been aggressive, in fact, but they have reduced CO2.]

All that said, its very sad to see by how much our elected officials continue to fail us with regards to this threat – we totally can’t count on them. It seems the EPA is the only hope we’ve got in the US and we’d better pray the Admin here doesn’t horse trade the EPA’s power away to our coal/oil black democratic/republican representatives for something (which they’ve hinted at). In the end the EPA may be all we end up having to count on for much of this decade.

Sen. Boxer’s amendment says that revenues (presumably from auctions and fines) will go to offsetting the additional cost to consumers from rate hikes due to the revenue collection. So money is collected from the utilities, then paid to consumers, then paid to the utilities. Nothing will be done to mitigate CO2, but some money will be shuffled around.

The utilities will in effect buy licenses to profit from pollution as usual and make the utility customers assume the cost, reimbursed by the US government, so we can pretend that something is being done about global climate change.

What would happen to cap auction revenues remains the sticking point for future legislation. I hope the revenues can be put into a dedicated fund for transmission lines and CO2 mitigation technology development and deployment, instead of a consumer reimbursement fund.

Obama Administration/EPA:…

But after campaigning against Bush’s environmental record, Obama must be careful that he not be seen as dictating policy from the White House.

http://www.climateark.org/ shared/ reader/ welcome.aspx?linkid=123463

But even if electricity prices were increased by green economy legislation, that does not imply higher electricity BILLS for customers. This is a fact that is admittedly difficult to come to grips with at first.

Statistically, higher electricity bills, on a state-by-state basis, are correlated with lower electricity consumption, but not higher electricity bills. Why?

If you have a second, please take a look at these charts I put together last week (I’ve never linked to anything in a CP comment, hope this works!)

Price of residential electricity vs. annual residential consumption per capita in 2007: http://i42.tinypic.com/2r2pzwo.jpg

Price of residential electricity vs. electricity bill per capita as % of income: http://i44.tinypic.com/2irvq53.jpg

The first chart supports the logical assumption that higher electricity bills lead to lower rates of consumption. There are some aberrations to be sure, but the trend is clear.

The second chart shows that as electricity prices increase, electricity bills as a % of income are not statistically impacted in either direction. Bills hover between 1% and 2% of income, regardless of the price, and the trend line is almost exactly flat.

Progressive energy efficiency standards, as Joe has written about many times, reduce the demand for electricity consumption to the point that lower consumption outweighs relatively higher prices. California is a good example. In 2007 California paid the 8th highest retail rate for residential electricity in the United States, at almost 15 cents/kWh. Yet their per capita consumption was so low that they also paid the lowest bill in the country as a % of their annual incomes (well, they tied for lowest, with Colorado & Wyoming).