Bond-Hutchison
Report Gives Distorted View of American Power Act
June 24, 2010
Trillions and trillions of
dollars in new gasoline taxes! That is supposed to be the take-home
message of a report on the American Power Act that was put out by
Senators Christopher Bond (R-MO) and Kay Bailey Hutchison (R-TX).
The authors want readers to believe that the American Power Act would
impose crushing costs on American consumers. The authors don't want
readers to look at the American Power Act objectively and in its
entirety, because if they did, they would see that the Bond-Hutchison
report is an unbalanced polemic designed to inflame, not inform.
The American Power Act would do many things to accomplish its goals of
reducing carbon pollution and lowering America's dangerous dependence
on oil. The bill would use a mix of standards, consumer protection
provisions, and incentives to build an energy economy that is more
efficient and makes greater use of low-carbon energy sources, such as
nuclear and renewables.
You wouldn't know any of that by reading the Bond-Hutchison report,
which covers only one element of the American Power Act and ignores the
rest, giving readers a grossly distorted picture.
What would the American Power Act – in its entirety – mean for
consumers overall? Objective analyses published by the Massachusetts
Institute of Technology and others paint a far different picture from
the Bond-Hutchison report.
One such analysis was published by the non-partisan Peterson Institute
for International Economics, one of the nation's top independent
research organizations. It reported that the American Power Act would
yield a net jobs gain between 2011 and 2030, taking into account the
negative impacts of higher energy prices and the positive impacts of
increased investments in energy efficiency and low-carbon energy
technology.
Peterson estimated that household energy cost impacts would range from
a net gain of $35 per year to $136 per year in additional costs.
In any event, Peterson found that higher household energy costs would
be offset by higher income from increased employment and rebates of
emissions allowance revenues. Compared to business as usual, families
would be better off economically, with a slight increase in spending
power, if the American Power Act were enacted, Peterson estimated.
Peterson also analyzed energy security impacts. The study estimated
that the American Power Act would reduce oil imports nearly 10 percent
below business-as-usual, reducing revenues to oil exporting regimes by
$263 billion per year by 2030, including a revenue reduction for Iran
of nearly $19 billion that year.
The Bond-Hutchison report ignores the energy security benefits and also
ignores the environmental benefits of reducing fossil fuel combustion.
The Peterson Institute's analysis projected that the American Power Act
would yield significant reductions in local air pollution, including a
43 percent reduction in the neurotoxin mercury emitted by coal-burning
power plants.
As power generation shifts away from old, inefficient coal plants, the
American Power Act also would result in significant water conservation
every year, totaling 1.7 times America's average annual consumption of
bottled water.
As far as the Bond-Hutchison report is concerned, lowering carbon
pollution and shifting towards a more diversified, cleaner energy
portfolio would be all pain and no gain. Citizens and lawmakers should
look at the facts and not be fooled by such a gross
distortion.
