Members of the U.S. House of Representatives worked feverishly, albeit quietly, last week to pass legislation designed to reduce the county’s greenhouse gas emissions. The bill — HR 2454, The American Clean Energy and Security Act of 2009 — was passed by House members and will be voted on by the Senate, where it will needs 60 votes to move to President Obama’s desk.
The bill sets in place a market-based cap-and-trade system with the goal of reducing greenhouse emission by 17 percent from 2005 levels by 2020 and by 80 percent from 2005 levels by mid-century. The emission of greenhouse gases designated by Congress will be limited through the issuance of allowances to gas emitters. The government would assign about 85 percent of the allowances to companies and entities across the U.S. The remaining 15 percent of allowances would be auctioned off with the profits being used to defray energy expenses for low-income residents. There is much still unknown about the bill but several in Washington and lcoally are sure of one thing, consumers will be left paying the price for the billion-dollar piece of legislation.
Paying the Price
“The Cap and Trade bill passed by the House last Friday will drastically raise the cost of energy in our country, threaten our economic viability and lower our overall standard of living,” the National Cooperative Refinery Association said in a statement Tuesday.“It is important for the American people to be aware of bills such as these that impact our lifestyle and economy.”
The legislation is expected to be a major influence on anyone paying a utility bill and will largely influence the types of machines and energy people and businesses produce and use. With companies pressured to change their ways, many will forced to pass higher input costs onto consumers.
Initial studies completed by the Congressional Budget Office estimate the new legislation will cost an average household $175 a year. The EPA’s estimates are more conservative and range from $80 per year to $110 per year for a household.
Board of Public Utilities general manager Rick Anderson said preliminary figures from BPU suggest customers could see their utility rates increase from 25 percent to 50 percent per month because the utility derives a large percentage of its energy from coal. The increase would equate to a $13.70 to $27.40 monthly increase in BPU customers’ electrical bills. The figures are only estimates Anderson warns because emission levels and the price of carbon credits are still unknown.
For manufactures, the higher utility bills combined with the cost of upgrading their machinary will create a one-two financial hit. The Environmental Protection Agency currently monitors the emissions of about a dozen companies in McPherson County. Those same companies are now possible candidate for the gas-emission restrictions. NCRA is also expected to be largely impacted by the new legislation.
The National Petrochemical & Refiners Association says the legislation hurts refiners in two ways, by capping emissions from the refineries themselves and by limiting the acceptable level of emissions from the fuel the refineries produce and estimate the legislation costing U.S. refiners as much as $58 billion a year.
Some companies will be able to finance alternative energy projects to help decrease its greenhouse gas emission. But smaller enterprises, like BPU, won’t have the funding available and will be forced to deal with Congress’ new restrictions.
“We’ll be one of those captive groups,” Anderson said. “Right now we can only cry, complain and pay the bill.”
Profitable Changes
Despite anticipated financial hits for consumers, Congress’s environmental legislation has the potential to positively impact as many companies and individuals as it hinders. The wide-sweeping environmental legislation’s inclusion of vehicle emission standars and housing and building energy-efficiency levels means green energy and environmentally friendly technology will be in high demand.
Jill Strnad, director of public relations for Sunflower Wind of Hutchinson, which produces 100-kilowatt wind turbines, said the proposed legislation will boost people and companies’ interest in renewable energy but an overall trend toward green energy has many already looking to alternative energy.
“I think a lot of people are looking ahead and thinking how things will affect them five years down the road,” Strnad said. “I do think people wil be looking at renewables more as an overall trend not just becaues of the legisltation.”
The company’s turbines are designed to benefit small businesses, farms and schools. Wind energy is one of several forms of alternative energy that is expected to become a major player in Congress’s push for a cleaner environment.
Companies that sell energy-efficient house-hold items could also see a rise in demand from consumers looking to lower their utility bills and make their homes more efficient.
In a statement released by Johns Manville, which produces fiberglass insulation, Wednesday, the company noted the significant opportunities that could be made available to homeowners through the legislation.
"The weatherization aspect of the bill provides homeowners the opportunity to receive significant savings due to rebates of up to $1500 on energy efficency improves. That's good for the consumer, for companies like JM that sell products that improve energy efficient and it's good for the environment."
Gases defined as greenhouses gases in the clean energy legislation:
•Carbon dioxide
•Methane
•Nitrous oxide
•Sulfur hexaflouride
•Hydrofluorocarbons emitted from a chemical manufacturing process at
an industrial stationary source
•Others can be added by Congress, through petition, at a later date
