Tuesday, November 12, 2013
Energy bills could fall by 7pc if Brit. Government cuts green tax
Leading members of the “Big Six” energy companies promise to cut prices if Government scraps or delays green tax scheme
Britain's energy giants are to offer to cut bills by up to 7pc if the Government agrees to remove the cost of multi-billion-pound green schemes.
In a move which could seize the initiative from critics of the rising cost of bills, leading members of the “Big Six” energy companies have laid out two options to the Government.
One would see the costs of the Energy Companies Obligation (known as the ECO scheme) removed entirely.
If that is agreed, energy leaders have said they could immediately reduce bills by between 6pc and 7pc.
The second option is to delay the implementation of the ECO scheme by 18 months and allow a wider range of energy efficiency measures which are not as expensive.
At present, the ECO scheme demands that houses should be provided with solid wall insulation, which can cost up to £10,000.
Delaying the scheme will lead to only a 3pc fall in bills, the energy sector has calculated.
It is not thought that such a small fall will be seen as sufficient by the Government, which wants consumers to notice a significant fall in bills.
A 7pc drop, even if it funded by some increases in taxes, could see the average bill of £1,300 pounds fall by £91 a year.
The Telegraph revealed in September that energy companies were in late-stage negotiations with the Government over the ECO scheme.
Companies face fines of up to 10pc of turnover if they do not hit the environmental targets and have said that the total cost of the scheme could be as high as £3.1bn, or £125 on the average bill.
Energy companies have assured the Government that if there is any deal – which now looks increasingly likely – they will announce immediately that they will pass on the savings.
The Chancellor could make an announcement on a deal as early as the Autumn Statement, which is scheduled for the first week of December. The Government is keen to act after the Labour leader, Ed Miliband, announced plans for an energy price freeze if he were to win the next election.
In a recent appearance before MPs, William Morris, SSE’s managing director, said the price cut could happen “in a matter of weeks” from taxes being taken off bills and suggested that the regulator Ofgem should oversee the process.
It is also believed that Sam Laidlaw, chief executive of Centrica, the owner of British Gas, has given a personal assurance to the Prime Minister that the energy supplier will reduce bills straight away.
The proposals come as both Centrica and SSE are due to update the market this week on their financial performance. Centrica is expected to give details of Mr Laidlaw’s thinking on the possible ECO deal.
SSE is expected to announce that its household electricity and gas supply business fell to a £100m operating loss for the six months to the end of September, strengthening its arguments over the need for price rises which energy companies have blamed on rising commodity and environmental costs.
The company reports half-year results on Wednesday. It has already announced an 8.2pc price rise in bills, affecting about 4m customers, which comes into force on Friday.
Analysts at Exane BNP Paribas forecast that the SSE group’s adjusted, pre-tax profits will fall 19pc to £321m.
Despite the £100m operating loss forecast for the retail arm, SSE group is still expected to return operating profits of £504m – down 15pc on last year – thanks to its power generation and energy networks businesses, where profits have risen.
The company has previously pointed to the fact it expects its retail arm to be loss-making as justification for its price rise.
The company’s financial year-end of March means its profits are usually skewed much more heavily to the second half when customers use more gas to heat their homes in the winter months.
'Going Green' Costing US Greenbacks for Little Reward
President Barack Obama has shown that he is willing to ignore reason and logic time and time again in order to further to his philosophical agenda. This has been evident in the predictably failed rollout of healthcare reform, but it is also seen in the president’s inexplicable and constant support of so-called “green energy” – at the expense of consumers and without any evidence of success.
The Washington Examiner conducted an analysis of the tangible impact of LEED standards in New York City, asking the one question that matters: do LEED certified buildings use less energy on a relative basis than non-LEED certified buildings? The answer: No. The Examiner analysis found that buildings with LEED certifications use more energy per square foot than buildings without the certification.
LEED certification was developed and championed by the U.S. Green Building Council (USGBC) – which is not a government entity, but a private group – which profits from this faux certification boom and describes themselves as being "committed to a prosperous and sustainable future for our nation through cost-efficient and energy-saving green buildings."
In fact, I would have no problem with LEED standards if they were completely voluntary within the private sector – that is, if those builders that wanted LEED certifications were able to get them and those that didn't were not forced to comply.
But the USGBC managed a coup - somehow convincing (or bullying) the federal government, as well as more than 400 state and local communities that LEED standards were in the public's interest. Such is not the case. First, the National Research Council estimates that this green building mandate adds 8 percent to design and construction costs.
But, beyond strict costs, LEED standards have two main flaws: they are impractical and ineffective.
On the impractical front, LEED standards prevent buildings from using certain safety materials, including bulletproof glass, in courthouses, prisons and other government buildings. LEED standards don't account for the fact that government buildings are high-profile targets, and safety measures should be determined by public safety professionals not by environmental profiteers like those at the USGBC.
The USGBC also arbitrarily mandates that the wood used in LEED buildings be certified by the Forest Stewardship Council (FSC), a favorite standard of fringe environmental groups, including Greenpeace. Most American forests are certified using two other standards – the American Tree Farm System and the Sustainable Forestry Initiative. May seem like semantics, but it is not. As a result of this deliberate decision, 90 percent of timber used is from foreign sources. In effect, LEED standards are shipping jobs overseas.
But these standards are also less effective. Some environmentalists are critical of the FSC - noting that the FSC is biased towards large conglomerates and that shipping timber from afar increases consumption of gasoline and emits more greenhouse gasses.
Fewer jobs alongside dubious results - these are not outcomes federal, state and local governments should mandate. Reversing strict adherence to LEED standards, in addition to other arbitrary “green energy” initiatives, will help leaders realize these programs are impractical and ineffective in their goal of reducing energy consumption, while the regulations also negatively impact thousands of workers and families in their area.
Study: Fracking Cuts Energy Costs, Raises Living Standards
The recovery of natural gas through smart drilling and hydraulic fracturing is cutting energy costs and raising living standards throughout the United States, a newly published study has found. Economists at IHS Inc. report hydraulic fracturing, also known as fracking, will likely raise average U.S. household income by $2,700 per year and create 1.2 million new jobs by 2020.
Hydraulic fracturing is the process of extracting oil and natural gas from shale rock layers deep within the earth. Engineers drill thousands of feet below the earth’s surface and then create cracks in the shale formations by injecting water, sand, and trace chemicals under high pressure. Although energy producers have utilized fracking since the middle of the last century, Americans are benefiting from a fracking revolution today thanks to recent technological advances and new oil and natural gas discoveries.
Widespread Economic Benefits
“A revolution is under way in the production of unconventional oil and natural gas that is transforming America’s energy future and strengthening its overall economy,” the study reports.
IHS economists report fracking, by increasing energy supplies and lowering energy prices, is creating extensive benefits in the U.S. manufacturing industry. By 2020, total manufacturing production will increase 3.5 percent over baseline levels thanks to the lower energy costs, the IHS study concluded.
The study also found the increase in manufacturing production will create a $51 billion increase in annual revenue for federal, state, and local governments by 2020.
The United States leads the world in shale oil and natural gas resources, and fracking is giving American entrepreneurs a new edge in global economic competition, the study observes.
“The unconventional [energy] revolution is also contributing to a shift in global competitiveness for the United States by unlocking new production cost advantages for U.S. industries benefitting from lower prices for raw materials and the energy they use,” according to the study.
Government Threats Loom
The only appreciable danger to this increase in production and revenue, the authors state, is government regulations or prohibitions. Although top EPA officials have repeatedly testified they have never found a single incident of the fracking process contaminating groundwater, environmental activists claim fracking endangers groundwater and seek to ban or severely restrict fracking.
Merrill Matthews, a resident scholar with the Institute for Policy Innovation, says both taxpayers and tax collectors benefit from fracking.
“Fracking has dramatically increased the supply of natural gas, which has, one, turned the U.S. into one of the top producers—if not the top producer—of natural gas in the world, and, two, reduced costs so much that natural gas has become cheap,” said Matthews.
“The energy boom has also been a windfall for states and the federal government. In 2012 the energy industry, gas and oil, paid $9.7 billion in federal royalties, rents, and bonuses. And in 2010 the energy industry paid $8.5 billion in federal income taxes. That's money that the federal government doesn't have to take from taxpayers or borrow,” he explained.
Despite the huge economic windfall, environmental activists would like to smother the baby while it’s still in the crib, Matthews said.
“Ironically, it is the increased use of natural gas in power generation plants that has reduced our energy-related carbon dioxide emissions to near 1990 levels. While most countries that signed the Kyoto Protocol promising to dramatically reduce their CO2 levels have increased their emissions, the U.S. has been reducing its energy-related CO2 emissions—and the U.S. never signed the treaty,” Matthews explained. “Limiting fracking, which would reduce U.S. natural gas production, would likely have the effect of increasing CO2 emissions.”
Boon to Manufacturers
Josiah Neeley, a policy analyst at the Armstrong Center for Energy & the Environment at the Texas Public Policy Foundation, says reliable energy is the lifeblood of businesses and manufacturing.
“If you manufacture or ship products and goods, you use electricity to produce and deliver them. There will be nationwide benefits from fracking due to resultant lower energy costs. Businesses will expand, and new plants will open. What this all means is there will be more jobs,” said Neeley.
International Security Benefits
Fracking also offers international and national security benefits, Neely observed.
“U.S. natural gas production and exports will undercut Russia’s role as a dominant natural gas producer. Accordingly, other nations will no longer be at Russia’s energy mercy. Also, by stabilizing the world’s energy reserves, America and other nations won’t have to do business with odious and unstable regimes,” he explained.
Politics Could Jeopardize Benefits
H. Sterling Burnett, a senior fellow with the National Center for Policy Analysis, says the United States could increase oil and gas production even more, and further reduce its need for foreign oil, if the federal government would remove barriers to increased production and forego new ones.
“The Obama administration is considering more stringent regulations, despite numerous studies showing fracking has few, if any, negative environmental consequences. Additionally, the EPA has already tried to halt a number of operations, but they’ve had to back down when challenged in the courts,” said Burnett.
SCOTUS Revisits EPA Regulation of CO2
On October 15, 2013, the US Supreme Court (SCOTUS) granted ‘Certiorari’ to Petitioners who have been suing the EPA over regulations to control CO2. In 2007, SCOTUS had ruled that CO2 may be considered a pollutant under the Clean Air Act (CAA), provided EPA could demonstrate that continued emission of CO2 would harm ‘human health and welfare.’ In 2009, EPA published the required Endangerment Finding, which was subsequently attacked on scientific grounds by a collection of plaintiffs. [Full disclosure: SEPP is one of the many plaintiffs involved in this lawsuit.]
However, in June 2012, the Court of Appeals for the DC Circuit ruled against plaintiffs, giving deference on the science to EPA. EPA had proceeded to institute emission limits for motor vehicles, essentially by setting mileage standards. EPA is now arguing that, having successfully set CO2 limits for motor vehicles in May 2010, the CAA requires that emission limits be set on all other emitters of CO2. Using their statutory authority to set New Source Performance Standards (NSPS), EPA has proposed stringent limits on new power plants that will make new coal plants virtually impossible to construct. The EPA also wants to limit emissions from existing coal plants, arguing that EPA can set guidelines which the states would have to follow in regulating emissions from existing plants.
In the coming case, plaintiffs are essentially appealing the decision of the DC Circuit Appeals Court and hope to prevail — even though SCOTUS is not likely to listen to scientific arguments — although publication of the authoritative NIPCC report “Climate Change Reconsidered-II” (Heartland, 2013) cannot be ignored. In fact, the Supreme Court has restricted its Cert to the single question: Is EPA permitted to extend its authority to regulate emissions from motor vehicles to stationary sources?
The EPA is likely to use a section of the Clean Air Act called Prevention of Significant Deterioration (PSD). They have a strong case; it will require considerable ingenuity for the plaintiffs’ lawyers to prevail over the EPA. One sees at least two possibilities.
A. NAAQS (National ambient air quality standards)
The CAA requires the setting of NAAQS. However, it is a fact that
1. EPA has not set a NAAQS for CO2
2. EPA does not know how to set a NAAQS for CO2. There is no scientific basis for doing so.
3. Even if EPA were to set a NAAQS, there is no way in which EPA can demonstrate that its regulations can achieve it; further, there is no way whereby EPA can enforce it — since CO2 is global and EPA cannot control emissions from other nations, like China.
4. But without a NAAQS as a goal, any effort to set emission limits must be judged to be ‘arbitrary and capricious.’ In other words, without a specific target, there is no rational way for setting emission limits for power plants or other emitters.
B. Tailoring Rule
In the regulation of ‘criteria pollutants’ (of which there are currently six) the arcane provisions of the CAA require EPA to regulate emissions from sources that emit more than either 100 or 250 tons per year.
These limits are ok for CO2 from individual small sources, motor vehicles and even big trucks. But when applied to stationary sources, there would be millions of them, including apartment and office buildings, hospitals, schools, prisons, etc.
Clearly, EPA is unable to muster an effort to issue controls for all such sources. They have therefore arbitrarily raised the lower limit to 75,000 to 100,000 tons per year — by issuing a so-called ‘Tailoring Rule.’ It would permit regulation of major sources, such as power plants, refineries, and other large industrial installations.
However, EPA cannot simply change the law to suit its convenience. This cannot be done by administrative action; it must be done by the author of the law — which is Congress. Again, EPA’s revised lower limit may be considered “arbitrary and capricious”
What to do?
The sensible course for EPA is to go back to Congress and suggest an amendment to the Clean Air Act to permit continuing without setting a NAAQS for CO2 and for allowing a ‘Tailoring Rule’ that makes CO2 regulation more manageable. But it is unlikely that EPA will choose to do this. Because once the matter goes back to Congress, it is no longer under the control of the executive branch of government.
Congress, in its wisdom, could decide to do away with the PSD (Prevention of Significant Deterioration) requirement for CO2 and thus not permit EPA to extend emission controls to power stations. Or, going even further, Congress may decide that CO2 is not to be considered as a criteria pollutant and cannot be regulated at all under the Clean Air Act. In other words, Congress may decide that CO2 is not a ‘pollutant’ — and thus overturn and make irrelevant the Supreme Court decision of 2007.
There is little doubt that the House, as currently constituted, would choose one of these routes. It is entirely possible that the US Senate will go along — even though it has a Democratic majority. But 16 Democratic senators are up for re-election in 2014 — with some from coal states in the Midwest. So there is a strong possibility that the Congress will consider CO2 to be a non-pollutant. Even if the White House were to apply a veto, there is a good chance that it will be overturned — which would constitute a big defeat for the Obama Administration.
But political futures are hard to predict. Much may ride on the outcome of Obamacare and other snafus that might affect public opinion about the White House and thereby the mood of Congress. One thing for sure: public policy should not be set by unelected bureaucrats.
One of the most common claims made by those who warn of an anthropogenic global warming crisis is that increases in temperature have led to unusual melting in mountain glaciers, Arctic sea ice, and polar icecaps. Known collectively as the cryosphere, these are areas on or near Earth’s surface so cold that water is present in solid form as snow or ice in glaciers, icecaps, and sea ice.
A report from the Nongovernmental International Panel on Climate Change (NIPCC), an independent group of some 50 scientists from 15 countries, titled Climate Change Reconsidered II: Physical Science, summarizes the large, significant body of research examining the effect of global warming on the cryosphere. The research shows changes in glacier and sea-ice extent occur in ways that frequently contradict and rarely concur with the claims of the United Nations’ Intergovernmental Panel on Climate Change (IPCC) and the projections of its climate models.
Although the NIPCC report finds some melting of mountain glaciers, it notes melting is not occurring in other areas of the cryosphere. The current state of Arctic sea ice and polar icecaps is not “unnatural” and does not constitute evidence of a human impact on climate.
Information on the global ice budget collected from satellite and airborne resources, methods that are still in the early stages of development, suggest both the Greenland and Antarctic Ice Caps are close to balance. The global extent of sea-ice cover remains similar to what it was at the start of satellite observations in 1979, with ice shrinkage in the Arctic Ocean being offset by growth around Antarctica.
Contrary to claims by the IPCC, the research examined by NIPCC finds changes in the cryosphere occur in natural multidecadal, centennial, and millennial time-scale cycles independent of any human-related carbon dioxide (CO2) emissions. Historically, glaciers have been both considerably larger and substantially smaller than they are today; over the past 25,000 years, glaciers around the world have fluctuated widely in concert with changing climate, at times shrinking to positions and volumes smaller than today.
Although shrinking mountain glaciers make for popular propaganda videos, one mountain glacier is not indicative of the climate as a whole, and they do not respond to global temperature change in a simple, uniform way. Recent research indicates the observed changes in temperature, snowfall, ice flow speed, glacial extent, and iceberg calving in both Greenland and Antarctica lie within the limits of natural climate variation.
CCR-II concludes new research finds less melting of ice in the Arctic, Antarctic, and mountain glaciers than previously feared, and no melting at all that could be uniquely attributed to rising carbon dioxide levels.
More HERE (See the original for links)
Australia: Greens protest killed my father, man says
GREEN protesters will be subject to workplace safety laws after a Forestry NSW worker was killed while standing guard between demonstrators and a logging site.
John Creighton, 59, who worked in forestry for 39 years, was hit by a falling log while overseeing the work on private land in Whian Whian in the state's north.
His son Russell said while he didn't want to lay blame he knew work practices on the day were changed as a result of the protesters on the site. "He was standing where he was because of that," he said. "He was called into these areas because of his experience - because he followed the letter of the law. That impacts us as a family."
Initial investigations revealed Mr Creighton was standing between a group of protesters and the logging site when he was hit in the head by the log on October 9. He died two days later in hospital.
As a result, Finance and Services Minister Andrew Constance said he and Primary Industries Minister Katrina Hodgkinson would move to make protesters subject to the workplace and safety laws of any site they enter.
"Enough is enough," Mr Constance said. "Forestry activists need to understand they are entering the worksites of one of the most risky industries that operate in NSW."
Mr Creighton Jr said, while his dad had spent the majority of his career in forestry, he understood the right of people to protest against it.
"He said the majority of people out there had good intentions - but then there's the radical element," he said.
He said he would support any law change that forced protesters to follow work safety rules: "If it was a union picket and blokes invaded a work site they would be hauled away by police and face fines."
Coffs Harbour MP Andrew Fraser last week blamed the protesters for Mr Creighton's death and called them "ratbags".
"Mr Creighton should not have been there. However, because of work health and safety concerns it was deemed necessary for Mr Creighton to be there,'' Mr Fraser said.
"A family has lost their father because greens failed to comply with health and safety regulations."
For more postings from me, see DISSECTING LEFTISM, TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC and AUSTRALIAN POLITICS. Home Pages are here or here or here. Email me (John Ray) here.
Preserving the graphics: Most graphics on this site are hotlinked from elsewhere. But hotlinked graphics sometimes have only a short life -- as little as a week in some cases. After that they no longer come up. From January 2011 on, therefore, I have posted a monthly copy of everything on this blog to a separate site where I can host text and graphics together -- which should make the graphics available even if they are no longer coming up on this site. See here or here
Posted by JR at 1:58 AM