Passing the Buck

The DNR conducted an analysis of We Energies’ large coal power plant in Oak Creek, Wis., and noted that the cost of installing CCS on the plant would be about $4.3 billion. The estimated pipeline cost to ship the captured carbon dioxide to Illinois for storage was $750 million of that total cost.

-Brian H. Potts in a column today

Mr. Potts, a partner at a long-established law firm in Madison and who specializes in environmental affairs, offers an insightful opinion today on new rules proposed by the EPA that could cost Wisconsinites a lot of money. Mr. Potts writes:

The U.S. Environmental Protection Agency recently proposed a rule that would require all newly built coal power plants in this country to install a new technology called carbon capture and storage, also known as CCS.

CCS removes the primary greenhouse gas (carbon dioxide) from the power plant’s exhaust and pipes it to underground storage reservoirs.

Let’s ignore the startling reality that an executive branch agency, in the hands of extreme-minded people, can essentially make these ground-shifting decisions unilaterally. For now.

As with all decisions like this one, the EPA is making these calls knowing with one hundred percent certainty that the massive costs will be shifted onto the backs of ratepayers if the onerous CCS regulations are imposed.

In economics a concept called externalities holds that every decision has a cost to the environment – human and natural – outside the organization in which the decision is made. But the impossibility of knowing what far-flung corners of the universe our decisions will affect, the infinite complexity of the ripple effect, makes realistic externality calculations mostly arbitrary.

The decision making of towering government regulation is packed with externalities, the most pressing of which are the pillaging of average Americans’ pocketbooks (or ETF debits, if I’m to not be square). CAFE standards result in crappier, more expensive cars. Energy efficiency mandates drive up home ownership costs and tighten the screws on expanding businesses. More broadly, an adversarial and intrusive executive branch that bases its decisions on unproven evidence – most science is as yet unproven (scientists don’t even agree that time is a thing) – forces higher compliance costs, disincentivizes the risk taking that leads to economic growth, and focuses resources away from pioneering economic activity and toward building a cocoon to protect from a hostile outside environment.

In short, regulation sells out future economic opportunity at the price of security today. Security based on iffy-at-best evidence by the same crowd that can’t even predict next week’s weather.

In shorter, the mandate Mr. Potts writes about sells out the cash-strapped ratepayer on the basis of dubious evidence that flipping a lightswitch will directly correlate to our grandchildren living in a real-life “Waterworld,” where criminal gangs pillage old oil platforms on grungy old PWCs and a Kevin Costner-reincarnate finds a big lost island using a map tattoo’ed on some girl’s back.

The proposed mandate targets coal power, which the Obama Administration hasn’t really hidden as a chief target of its policies. Most of our power is generated by coal, and though natural gas plants are burgeoning, the war on coal is a war on current energy rates. The EPA doesn’t really care if you consider today’s rate low or not – it wants them to be higher.

For those genuinely concerned about the emissions from coal power plants, take note: the new EPA mandate doesn’t require the sequestering of heavy metals like Mercury. Instead it does treat carbon dioxide in a similar fashion as nuclear waste, even though some 7 billion human beings, including those proposing these regulations, breathe the gas out every few seconds.

And what are the future externality implications of storing massive amounts of carbon dioxide underground? Do the left-wing environmentalists have the same concerns about this as they do to melting permafrost that they claim will release naturally stored carbon dioxide deposits?

Let’s not forget that even a potent greenhouse gas like carbon dioxide has a finite lifespan in the atmosphere; most of it is absorbed by oceanic algae (some by forests) within 100 years. Some is frozen into polar ice. Let’s also not forget that centuries years ago, a mini-Ice Age kept the River Thames frozen all year long. Unless Shakespeare drove a Range Rover unbeknownst to historians, that was unlikely the result of human activity.

The real point isn’t to discount the proposition that adding carbon dioxide to the atmosphere might result in the increased reflection of ultraviolet radiation back toward Earth’s surface. That very greenhouse effect, in all its epochal undulations, is the reason life can comfortably exist on Earth’s surface where it would both freeze and suffocate on the surface of a planet like Mars.

Our government and society must decide whether the evidence proposed by a group of mere moral scientists competing over federal grants is sufficient to warrant a fundamental re-working of the building blocks of our economies. At $4.3 billion for just one power plant in Wisconsin, that’s going to be a pretty big cost. We need to decide if we have a century or so to let the free market take its course toward higher-efficiency means of energy production, which I believe we do.

We also have to decide in whom we’re going to entrust such massive decision making power. To be so utterly convinced that human activity over a couple centuries amidst 500 million years of higher life on Earth can wreck the planet – from the perspective of just a couple generations of high science and reliable planetary temperature measurement – strikes me as quite arrogant in light of the giant cost it would place on everyday Americans (and not on everyday Chinese citizens, or citizens of any other emerging nation, mind you.)

I’m a proponent of vigorous research into next-generation energy sources, from fuel cells that power individual homes and decentralize the energy grid to nuclear-based prospects, even fusion power. That’s a long way off. So is – at the risk of sounding too out-there – antimatter – but we should work toward it.

That doesn’t equate to the unilateral dictates of an imperial EPA that forces multibillion dollar costs on today’s energy sources and requires cash-strapped middle Americans to keep their thermostats at 62.

Quote of the Day

“I like your company.” “Well, I like a good swig of gin at lunch but I’ve learned to do without.”

-Toby & Debbie in The West Wing, “Memorial Day”

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About the writer: Chris Rochester has worked in communications and finance for a state Senate and congressional campaign, consulted on numerous Assembly and local races, and has held leadership roles in his local Republican Party. He's communications director for the MacIver Institute. Commentary here is strictly his own.