Recent reports by the Associated Press and other news organizations depict a bleak future for American energy consumers. Electricity prices are on the rise, and your wallet will soon know it. Frustratingly, the reason those prices are going up have nothing to do with normal economics.
The problem isn’t that demand has been increasing – in fact, even as the U.S. population has grown, our energy consumption has leveled off over the past 15 years due to increased efficiency and conservation.
And the problem isn’t that prices for fuel have increased – coal historically has had amazing price stability, and today other fuel sources, notably natural gas, are at incredibly affordable levels.
The reason you and I and every other consumer will take a hit in our pocketbook with higher energy prices has nothing to do with the normal forces of supply and demand. This situation is entirely artificial and being imposed upon us by Obama Administration fiat.
AP reported this month that 69 coal-fired power plants across 20 states are expected to shut down between 2014 and 2017 due to current EPA standards – and this doesn’t even include effects of even more-draconian regulations expected soon.
The U.S. Department of Energy expects coal plants with the output capacity to supply 30 million homes to shut down by 2020. That supply will be replaced by more expensive energy sources. DOE expects prices to increase 13 percent by 2020, and that doesn’t even take into account additional EPA regulations on the horizon.
Does this look like progress towards a more energy-independent America?
Tens of thousands of Americans will lose jobs due to plant closures. As electricity prices rise, it will be more difficult for energy-intensive industries, like manufacturing, to add jobs. And most of the country will see serious negative impacts on their cost of living from rising electricity prices. Electricity is an input cost in virtually every consumer product we buy – these policies will literally affect the price we pay for everything.
Advocates of anti-coal policies point to alternative energy as the answer to fill the gap left by closing coal plants. Their claims ignore the data – even with rapid growth in renewables over the past several years, they can still supply only a small fraction of our coal output. And with the expiration of the renewable energy production tax credit at the end of 2013, the true cost of renewable energy sources will soon become apparent.
And what do we gain by shutting down American coal plants, killing American jobs, and sticking every American with more-expensive energy bills? From a carbon emissions standpoint, the gains are virtually nonexistent. The world is using increasing amounts of coal and other fossil fuels, and necessarily so – 1.2 billion people in the world still don’t have access to electricity.
President Barack Obama and his environmental allies are so blinded by their opposition to coal that finding an American solution through cooperation is no longer an option. Instead, they’ve pushed our country in the opposite direction by placing a de facto ban on investing in coal technology due to the regulatory overload enacted by the EPA.
Shutting off our cheapest and most efficient source of electricity is an irresponsible course of action, and does nothing to secure America’s future. If we really want to ensure the prosperity of our nation for generations to come, we must make responsible public policy decisions that aim for practical outcomes rather than relying on the power of wishful thinking.
Sen. Ed Walker, Republican
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