the Air Vent

Because the world needs another opinion

It’s Simple

Posted by Jeff Id on June 29, 2009

Climate Bill Helps Utilities More Than Oil Companies

The bill, which creates a market for carbon dioxide permits potentially worth more than $100 billion a year by 2020, regulates the way the allowances could be traded to guard against speculation with derivatives that lawmakers say might drive up the prices of electricity and gasoline.

“This bill tries to help utilities and manufacturers move to a low-carbon economy without harming consumers, draw farmers into the carbon market and keep that market transparent to prevent improper profit-taking,” Tim Profeta, director of the Durham, North Carolina-based Nicholas Institute of Environmental Policy Solutions at Duke University, said in a telephone interview. “The oil industry got fewer free permits because lawmakers believe these firms can pass the relatively low cost to their consumers without affecting their bottom line.”

Well the bill has nothing to do with not harming consumers, but you can say anything these days.

More than 70 percent of the allowances would initially be given away.

The buyoffs begin. It’s about control people.

The legislation, passed 219 to 212, largely rejected President Barack Obama’s plan to raise revenue for the federal government by selling the permits at auction and instead doled out free credits to win the support of Democrats from coal, manufacturing and farm states. Oil companies got many fewer free permits. The proposal now faces action in the Senate.

Oil refiners would receive just 2.25 percent of the allowances for free, while having to acquire nearly 40 percent of the available permits each year to cover the emissions at refineries and the carbon dioxide produced when fuels like gasoline are burned by cars and trucks, according to data from the Environmental Protection Agency.

The tax we were promised wouldn’t happen….

The oil companies received only a small number of free permits relative to their emissions so the federal government would still have some left to sell at auction, Drevna said. Oil firms, which argue the measure could lead to capacity cuts at U.S. refineries and a 77-cent increase in the cost of a gallon of gasoline, hope “cooler heads prevail” in the Senate, Drevna said.

Giving China more advangage:

Oil refineries have been blocked from getting any of those free allowances, Drevna said. As a further protection for U.S. industry, the legislation calls for carbon-based tariffs if countries like China and India don’t adopt their own greenhouse gas controls by 2020

Tightening the rules of added taxes to…. protect manufacturing?

Senator Sherrod Brown, an Ohio Democrat, said in a phone interview he wants to “tighten up” the House-passed tariff provisions “to do more in terms of protecting manufacturing.”

Banker excitement at making more money:

European emission traders are encouraged by the passage of the House climate-change bill because a U.S. cap-and-trade program would give a “huge boost” to the size of the international carbon market, Abyd Karmali, Global Head of Carbon Markets at Bank of America Merrill Lynch, said in an e-mail.

What happens when congress tightens the restrictions — How the money is made, simple eh?

The bill’s proposed ban on over-the-counter, or privately negotiated, deals for futures and other derivatives based on cap-and-trade permits and offsets, is a “significant concern,” Karmali said.

During the House debate over the bill, Democrats fought back Republican attacks that the cap-and-trade market would be open to manipulation by pledging severe restrictions on carbon- based derivatives.

“This bill tries to help utilities and manufacturers move to a low-carbon economy without harming consumers, draw farmers into the carbon market and keep that market transparent to prevent improper profit-taking,” Tim Profeta, director of the Durham, North Carolina-based Nicholas Institute of Environmental Policy Solutions at Duke University, said in a telephone interview. “The oil industry got fewer free permits because lawmakers believe these firms can pass the relatively low cost to their consumers without affecting their bottom line.”

8 Responses to “It’s Simple”

  1. AEGeneral said

    Today’s idiot: “It’s big oil’s fault! Price gouging!”

    Tomorrow’s idiot: “It’s big utilities’ fault! Price gouging!”

    Next generation’s idiot: “It’s big alternative energy’s fault! Price gouging!”

    Shampoo. Rinse. Repeat.

  2. timetochooseagain said

    1. Unfortunately said idiots get goaded on by “Number one Cable News Show” “conservative” idiot Bill O’Reilly. That “gouging” crap really makes me fly off the handle, I’m glad someone else seems to get it.

  3. Kenneth Fritsch said

    I do not judge that the bill in question would do much for CO2 emissions even without the politics included in it. And I do not judge that we have sufficient information or confidence in that information to say that limiting CO2 emissions would in turn be beneficial. However, when the politics that are played to favor some over others is pointed out, even those with great faith in government have reason to pause. Can you connect the color of the states to whom will be favored and whom will not?

    Unfortunately the intellectuals and MSM will rationalize all this favoritism as a political expedient required to get the US on board for CO2 emission reductions. Everything is an emergency and the current administration is playing that for all its worth in getting their agenda through without debate.

    Politicians are having their way despite low ratings among the voting public, I judge, because the intellectuals and MSM have suspended critical comments. They seem content to see the world ending as we know without government action even when that action has been shown to cause very serious hangovers that can be of life threatening proportions.

    Jeff, while negative thermometers may be unphysical I do not think that negative opinion poll numbers for politicians should considered that way.

  4. Ryan O said

    Politicians are having their way because the rest of us are too lazy to do anything about it. Not criticizing you, Kenneth . . . just a general comment. By and large, the public is just too lazy – or too indifferent – to care enough to take any kind of real action.

  5. Roy Sites said

    #4 Ryan O
    You are correct, we the people have let this happen and now we are barrelling towards the abyss of bankruptcy.

  6. Kenneth Fritsch said

    Politicians are having their way because the rest of us are too lazy to do anything about it. Not criticizing you, Kenneth . . . just a general comment. By and large, the public is just too lazy – or too indifferent – to care enough to take any kind of real action.

    I judge that the common folk get their information from the leanings of the current crop of intellectuals and what gets disseminated down through the MSM. The MSM certainly takes it lead from the current consensus of intellectuals. The public can appear lazy because they see no good alternatives in the political process. And I think they are correct as the process will not change until the intellectual consensus changes.

    I see some encouraging signs in the intellectual world and particularly with some younger members, but I do not think that we will see any significant changes until we have reaped what we have sown and there is a good understanding of what was sown and who sowed it.

  7. Jeff Id said

    I like your optimism Ken. I don’t see enough thinking from our youth to give me any comfort that even after the fact it will be recognized. How will this mess ever be undone…

  8. kmye said

    “As a further protection for U.S. industry, the legislation calls for carbon-based tariffs if countries like China and India don’t adopt their own greenhouse gas controls by 2020″

    Assuming we’ve managed to change WTO rules and other applicable law to make the tariffs legal by 2020, I wonder if there’ll be anything left worth “protecting”…

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