Wednesday, September 16, 2009

Cap (your electric use ) and Trade (your jobs for, well, nothing).

This is an older article but it has the figures I was seeking - costs per family if the Carbon Cap and Trade bill is approved by the Senate (it already passed the House). Basically, the idea behind cap and trade is to force you to use less energy by the simple expedient of demand destruction - making it too expensive for you to use. For most families, this will be most noticeable in the substantial hike in their electric bill (and natural gas/heating oil bill, if they heat with fossil fuels).

The Wall Street Journal Online
The Cap and Tax Fiction
Democrats off-loading economics to pass climate change bill.
June 26, 2009
Editorial Opinion

...Under a cap-and-trade system, government sets a cap on the total amount of carbon that can be emitted nationally; companies then buy or sell permits to emit CO2. The cap gets cranked down over time to reduce total carbon emissions...

As the cap is tightened and companies are stripped of initial opportunities to "offset" their emissions...The corporate costs of buying these expensive permits will be passed to consumers.

...The hit to GDP is the real threat in this bill. The whole point of cap and trade is to hike the price of electricity and gas so that Americans will use less. These higher prices will show up not just in electricity bills or at the gas station but in every manufactured good, from food to cars. Consumers will cut back on spending, which in turn will cut back on production, which results in fewer jobs created or higher unemployment. Some companies will instead move their operations overseas, with the same result.

When the Heritage Foundation did its analysis of Waxman-Markey, it broadly compared the economy with and without the carbon tax. Under this more comprehensive scenario, it found Waxman-Markey would cost the economy $161 billion in 2020, which is $1,870 for a family of four. As the bill's restrictions kick in, that number rises to $6,800 for a family of four by 2035...

...The reality is that cost estimates for climate legislation are as unreliable as the models predicting climate change. What comes out of the computer is a function of what politicians type in. A better indicator might be what other countries are already experiencing. Britain's Taxpayer Alliance estimates the average family there is paying nearly $1,300 a year in green taxes for carbon-cutting programs in effect only a few years.

Americans should know that those Members who vote for this climate bill are voting for what is likely to be the biggest tax in American history. Even Democrats can't repeal that reality.

Now, climate change is a real phenomenon - but there is little evidence that man's activities cause it. Solar radiation levels track much more closely with atmospheric temps than industrial activity. This is known to both energy and climate scientists, so we can guess that the real reason for the program to reduce energy usage has a lot more to do with peak oil than it has to do with trying to "stop" an unstoppable natural process. But the topic of Peak Oil is political suicide, for some strange reason, while climate change is not. So they package it however they need to - but the end result will be the same.

And, as the sponsors of the bill discuss plainly - the point is to make you reduce your energy usage, since you show no signs of doing so voluntarily.

Of course, like all other government estimates for anything anywhere, you need to cut the timeframe in half and double the amount. So if they're publicly saying almost $2000 a year for a family of four in ten years, that means in real life it will be about $4000 a year for a family of four in about five years. Of course, that is not some sudden increase that appears out of the thin blue air - the taxes added to your power bill will begin to rise immediately.

Let's do a little math. We'll presume no heart-attack inducing jumps in your bill, just a steady rise. First, let's presume their figures are correct - that your electric bill will rise $2000 over ten years (don't laugh, we have to start somewhere). That means if they haven't lowballed their estimates (and it would be a first, mind you) your bill will rise about $200 per year, or about $17 per month.

So, our current electric budget payment is $120 per month for our all-electric townhouse. So starting in 2010, the monthly budget would be $137 - annoying but doable. Then in 2011, the new budget would be $154, which would be difficult for us to pull off if take-home pay does not increase, which it is not likely to do. In 2012, the budget payment will be $171 per month and in 2013, the electric bill would be $188 per month. In 2014, the payment would be $205 per month - meaning it will have nearly doubled in only four years. And in 2015 the budget bill would be $222 per month.

So if we represent the "average family," then in only five years our electric bill will more than double, and according to their projection there will still be five more years of identical increases to go: 2016 would be $239, 2017 would be $256, 2018 would be $273, 2019 would be $290 and in 2020 our electric budget bill would be $290 a month, a 150% increase from where it is now.

But this looks great compared to what the ACTUAL results will probably be.

Now, if we use the "realistic" figures of a $4000 rise over 5 years, this is what will happen. If your electric bill is going to go up about $4000 over five years, that means your bill will rise about $800 per year, or about $67 per month.

Our all-electric townhouse has a current electric budget of $120 per month. That means for 2010, our electric budget will rise to $187 per month. Already, I can tell you I would be hard put to afford that. Then, for 2011, the budget will be raised to $254 per month. That's over twice what we're paying now in only two years. There's no way we're going to have raises or income to cover such a jump. Then, in 2012, the budget payment will jump to $321. For 2013, it will go to $388 per month. In 2014, the budget payment will be $455 per month, and in 2015, the budget payment will be $522, and there's no way on God's green earth we can afford that in five years, or even ten.

To summarize, right now we are paying about $1440 a year for electricity. In five years, if these more "realistic" figures are correct, we will be paying $6264, which is a little less than $4000 more than we are now paying per year. If the "official" projected figures are correct, in five years we will be paying $2664 per year, and in ten year we will be paying $5328 per year.

Either way, the average family's bill is going to be WAY higher in the coming years, whether the way goes steeply or somewhat more slowly.

Even if the Cap & Trade bill doesn't pass this year, it or something like it will pass eventually. So what we need to do now is to figure out ways to reduce electric usage. We have come up with several ways, and are already implementing some of them. So here are some ideas - in no particular order.

First - line dry clothing, even indoors. Dryers take up a huge chunk of your electric bill. We have installed two boards opposite each other in our dining room (painted the same color as the walls) with eye hooks in them, and cut laundry lines to length with hooks on the ends. We have a schedule for everybody to do their laundry - they wash and hang up one day, and take down and "fluff" for 15 minutes max in the dryer the next day (if necessary, otherwise they just take them down, fold them, and put them away). Friday afternoon, the lines and clothes pins are stored away until the next week. As an added bonus, lights and streamers can be hung up using the boards on Tom Tovim and birthdays and such. Any room that is not used everyday can have a set of laundry lines - and we also have one in our bedroom for undergarments and things. Again, simply unhook the lines and store them away when the stuff is dry or company is coming. Another option is to use folding laundry drying racks.

Second - vacuum cleaners. Convenient, yes. Energy efficient, no. Get rid of all wall-to-wall carpeting. Rugs can take an old-fashioned beating or go to the dry-cleaners once a year. The floor can be swept with a broom and mopped for zero cost in electricity.

Third - kitchen appliances. Granted, there are some I won't part with until I absolutely have to, such as my electric ice cream maker. Most of everything else can be transitioned to old-fashioned hand tools like Grandma used. They worked fine and produced food fit for kings and presidents, and still can.

Fourth - toys that require electricity. Ditch them. We had a "no toys that require batteries" rule from day one and our kids have never been deprived of having more toys than they could play with and very messy rooms, just like kids who need their battery fix or else...

Fifth - hair care. Electric dryers and stylers do more damage to your hair than the manufacturer's care to admit. I do have some, but I seldom use them more than once or twice a year, for VERY special occasions. And in reality, I could just as easily have my hair done professionally for those rare occasions as to waste more money on hair appliances. When the ones I have die they will not be replaced.

Sixth - emergency preparedness. Get some of those new-fangled no-battery needed wind up flashlights, a wind-up radio, and plenty of candles. Also, get a few old fashioned wind-up alarm clocks (metal, not plastic - the plastic ones are cheap junk and don't last). Get an old-fashioned washing board for your bathtub in case you end up having to do laundry by hand.

Seventh - Computers, TVs, etc. Plug these into power strips and make sure you turn the strip off when you're finished using them. These things are called "power vampires" because their "stand-by" modes use an amazing amount of electricity for things that are supposedly turned "off."

Eighth - a programmable thermostat for your HVAC. And turn off the air conditioning unless the temps and humidity are truly unsufferable, say over 85 outside minimum. Installing ceiling fans will use electricity, but far less than the A/C will. We have fans in every room. If your windows are painted shut, get out your putty knife and get them working. For a double hung window to work properly, the top of the window must be lowered for the heat (which rises) to escape, and the bottom part of the window must be raised to draw in cooler air - both at the same time. Most modern windows are strictly for decorative use and aren't designed to function properly, so you may need to install, by hand, screens or screen material to make this possible (unless you like bugs).

Ninth - weatherstripping. Have caulk, will apply it. Everywhere. Don't hold back. And plastic those windows in the winter - and then cover with heavy draperies, preferably insulated. An ounce of prevention is worth a pound of electric charges.

That's all off the top of my head. Feel free to make suggestions - we need to start thinking seriously about how to lower our bills. And with winter right around the corner, now is a great time.

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