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House GOP proposes 25% national energy tax, recycles Cheney energy plan

By Joe Romm  

"House GOP proposes 25% national energy tax, recycles Cheney energy plan"

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Badly outnumbered and months behind in the debate on energy and climate change, House Republicans plan to introduce an energy bill on Wednesday as an alternative to the Democratic plan barreling toward a House vote this month.

The Republican proposal, drafted by a group led by Representative Mike Pence of Indiana, leans heavily on nuclear power, setting a goal of building 100 reactors over the next 20 years.

The GOP energy proposal, the American Energy Act (AEA), is nothing more than a good old-fashioned energy tax on consumers.  The House energy and climate bill, on the other hand could save $3,900 per household by 2030, thanks to its strong emphasis on energy efficiency, which is utterly absent from the GOP plan.

The cornerstone of the GOP plan — whose acronym just happens to be nearly identical to that of the IAEA (International Atomic Energy Agency) — is an $800 billion plan to build 100 nukes (see “Areva has acknowledged that the cost of a new reactor today would be as much as 6 billion euros, or $8 billion, double the price offered to the Finns”).  Taxpayers will assume the full liability for any default on those nuclear plants.   The Congressional Budget Office estimates the likely default rate of these loans at over 50% — so that’s $400 billion down the toilet right there.  And of course taxpayers already assume the liability for any catastrophic meltdown.

Now we know that if you even start building a nuclear power plant, electricity bills go up a decade before any customer sees a single electron (see “What do you get when you buy a nuke? You get a lot of delays and rate increases”¦.“  For customers of Progress Energy in Florida, which is trying to build twin nukes, bills jumped 25 percent in January “to cover early costs for the new reactors as well as increases in the cost of fuel Progress purchases to generate power.”

By spreading 100 nukes around the country and with no strategy to stop fuel prices for power generation from rising, the GOP plan would be the equivalent of a 25% tax on every American’s electricity bill.

But that’s not all.

The Atomic Energy Agency American Energy Act is “Identical To President Bush’s Failed Plan” as Media Matters demonstrates with a side-by-side comparison between AEA and the Cheney plan.  In April, the Center for American Progress (CAP) released a detailed analysis showing the main result of the Bush-Cheney plan was that energy costs rose more than $1,100 for the average American household:

Over this period, the typical annual American household expenditure on electricity rose more than $170, and the typical annual American expenditure on gasoline rose more than $960 (in 2007 dollars). Note that the gasoline price increases listed here do not include the unprecedented $147 per barrel of oil and $4.11 gasoline prices that occurred in the summer of 2008.

The new GOP plan is not just a 25% tax on electricity.  Since it does nothing whatsoever to deal with our dangerous and growing dependence on oil — whose global production is at or near the peak — it will inevitably lead to the same exact outcome that the Cheney-Bush plan did, a sharp rise in consumer fuel prices, the equivalent of a huge gasoline tax (except the “revenues” of this tax end up in the hands of OPEC).

The GOPs costly national energy tax plan is actually quite similar to the energy plan Joe Barton (R-TX) offered a while back (see “Contempt of Congress: House GOP reveals disdain for clean energy, livable climate with a more-of-the-same rehash of Cheney energy plan“)?  It still stops the EPA from taking any action whatsoever on global warming.  And yet, as you may remember, the GOP leadership dissed the Barton plan, as the Politico noted in a piece, “Leaders cool on warming skeptic“:

Republican leaders aren’t backing a Barton alternative to the Waxman-Markey bill that would gut the 1990 Clean Air Act to prevent the Environmental Protection Agency and other state agencies from regulating carbon emissions and other greenhouse gases as pollutants. Instead, they’re backing an alternative crafted by Indiana’s Pence “” who’s not even on the Energy and Commerce panel “” that seeks to expand nuclear energy production, improve clean coal technology and “drill, baby, drill” for oil and gas in this country.

Thankfully, this GOP plan exists only for the purpose of giving the party some talking points, although why 100 nukes and a national energy tax are positive talking points is a mystery to me.

Finally, since the GOP has seen fit to recycle the Cheney-Bush plan today, it seems only fair to recycle CAP’s analysis of its impact on US consumers:

Gas and electricity prices battered household budgets in the last recovery

America needs to invest in a diverse clean energy economy now instead of doubling down on dirty energy. The recession and the low prices of gasoline and electricity provide an opportunity to ensure the next period of economic growth is not like the last one.

Economic growth under Bush lasted from November 2001″”when the United States emerged from the first Bush recession””to December 2007″” the beginning of the second Bush recession, according to the National Bureau of Economic Research, which tracks and measures business cycles.

Over Bush’s period of economic growth, expenditures on electricity for a typical American family (earning the median income) grew 16 percent to $1,285 in 2007, up from $1,106 per year in 2002, an increase of $179. The typical family’s expenditure on gasoline grew nearly 70 percent to $2,418 in 2007, up from $1,450 in 2002, an increase of nearly $1000 (All dollar amounts in inflation-adjusted 2007 dollars.)

The price of gasoline and home electricity grew faster then general inflation because of the lack of diversity in our energy system and spiraling global demand for fossil fuels: 1.6 times faster in the case of residential electricity and a staggering 6.4 times faster in the case of gasoline.

Gas and electric prices grew much faster than inflation

These price spikes occurred despite the Bush administration’s massive public subsidies for dirty energy. The 2005 energy bill contained a token level of investment in renewable energy, but it also provided billions of dollars of support for dirty energy, offering $27 billion in subsidies for coal, oil, and nuclear energy.

Although the current recession has dragged down gas prices from the record $4.11 per gallon of July 2008, gas prices still averaged $2.01 in March 2009, up 67 percent from a $1.28 average in March of 2002. The fundamentals that created the huge increases in oil and electricity prices from 2002 through the summer of 2008″”after the recession officially began but before demand plummeted worldwide””still lurk, and will return with a vengeance once the global economy begins to rebound.

Less economically-developed countries such as India and China are now entering a phase in their development where their energy demands are growing toward the levels of industrialized nations. What’s more, demand is on the rise as populations and economies grow worldwide. World energy consumption is expected to expand by 50 percent from 2005 levels by 2030. The global economic slowdown has only stalled these long-term trends that are contributing to a rise in oil, coal, natural gas and other fossil fuel prices.

We can ease the dirty energy burden on American families by investing in efficiency improvements, winning the race for clean 21st century energy, modernizing our electricity grid, requiring utilities to produce more renewable energy from the wind, sun, and other renewable sources, and mandating that utilities boost energy efficiency instead of pollution. We can make sure that, during the next recovery, American families have access to energy that’s cleaner and cheaper.

‹ AP, Washington Times: “Experts suspect global warming may be driving wild climate swings that appear to be punishing the Amazon with increasing frequency”

UPDATE: Reuters and Greenbiz.com attack all federal clean energy technology development ›

13 Responses to House GOP proposes 25% national energy tax, recycles Cheney energy plan

  1. Rick Covert says:

    Joe,

    It sure looks like the Republicans are working hard to prove you right on the demerits of a carbon tax. Now if you could tell me more about Mother Jones story about the rip-offsets being written by the same banks that brought you the financial meltdown now lobbying and succeeding in creating a securitized sub-prime carbon market for its phoney financial instruments. Once the banks get addicted to that easy money Ponzi scheme they’re not going to want to let those rip-offsets sunset.

  2. Jim Beacon says:

    While you’re counting off the reasons not to build 100 new nuclear power plants, don’t forget to mention that we don’t even have a place to put the deadly waste from our existing plants, not to mention another 100 new ones. And if Nevada has its way, we never will have a place to put nuclear waste.

    And don’t talk to me about re-using and re-cycling nuclear waste. America can’t even recycle most of its beer cans.

    Since there is no state which actually wants a national nuclear waste dump inside its borders, we are never going to get one built because a state can tie up any construction of a dump in the courts forever. Meanwhile, the waste continues to pile up in steel drums in warehouses at our existing nuclear power plants in cities all over America. That’s right folks, right now all that waste is just sitting in warehouses in our cities — that *is* where they are putting it (and where they have been putting it for the last 30 years).

  3. James Newberry says:

    With high-level nuclear waste sitting at all nuclear plants today, can you imagine the future effect on national realestate valuations after an “event.”

    If we want to stop nuclear weapons proliferation, then what are we doing promoting the technology of nuclear power? Every reactor produces fissile plutonium and requires the technology of uranium enrichment.

    I say 100 reactors over time at $10 billion each is a one trillion dollar loan guarantee. The GOP (global oil party) has almost gone fascist. I pray that they are the only entity having an actual meltdown.

  4. Zeez says:

    Not only can we not find places to store the spent fuel from these reactors, the amount of fresh water consumed by the reactors would further deplete our rivers and supplies of fresh water. Given the droughts that we’re already experiencing in this country, we can’t afford to use our fresh water resources this way, especially as our climate continues to change. One reactor can take 4-6 billion gallons of water each year, and I’m going to guess that we won’t be able to sustain 100 more of them in this country without some serious consequence.

  5. David says:

    It’s also important to remember that nuclear energy is not clean. While the actual energy production does not emit GHGs, every other step in the process (mining, transportation, etc.) is highly polluting. And there’s always the problem of nuclear waste.

    The support of nukes is enough to discourage me from supporting the Republican energy plan.

  6. MikeN says:

    On the one hand people are saying the planet is doomed unless greenhouse gas emissions are brought under control. On the other hand, those same people are against low greenhouse gas nuclear power. I thought the point was to eliminate greenhouse gas emissions?

  7. MikeN says:

    Building 3000 nuclear plants only produces about 200MTCE.

  8. Col says:

    Side one of Republican mouth: we need small government which doesn’t pick technological winners.

    Side two of Republican mouth: we need to spend hundreds of billions of tax payer dollars on one particular technology.

  9. David says:

    Nuclear power is not low-GHG. While it is arguably better than coal, it is still not “clean.” It is also not economically sound.

    One thing I find funny, though is that the GOP says that Waxman-Markey is an energy tax, and now we’re saying the same thing about the AES.

  10. MikeN says:

    >Nuclear power is not low-GHG.

    Please explain this. It is at least an 80% reduction over coal. And I would think that a site that uses the word ‘progress’ would applaud having the party of obstruction willing to spend hundreds of billions to reduce electricity production carbon emissions by such a substantial amount.

  11. woolie says:

    There are alot of tired arguments here, it makes me wonder how serious people are about GHG reduction. Yes, the GOP is corrupt and lies on every topic imaginable (e.g. the climate denialism in their “plan”), so it’s frustrating to have them pushing nuclear, as they aren’t exactly credible. But from a dispassionate, technical perspective, the merits of nuclear expansion are hard to ignore w.r.t. GHG.

    The waste isn’t really an issue. It’s safely stored and monitored in secure, above ground dry-cask storage sites. If it’s really an issue, it can be reprocessed, or burned in advanced reactors. If U-235 supply becomes a major issue in the future, there are many fission alternatives to the once-through LWR fuel cycle that could run on alternative fuels basically forever. The water supply is also easily solved — it’s only used as a coolant, and is easily recycled, or otherwise mitigated with cooling towers, or we could use air- or gas-cooled designs.

    Sticking with credible sources, it’s generally agreed that LWR total CO2 production (including fuel cycle) is competitive with wind. After all, wind turbines use comparable (or greater, if capacity factor is taken into account) amounts of steel and concrete than LWRs.

  12. David says:

    Yes, nuclear is better than coal. I don’t know the exact figures on CO2 emissions of nuclear energy throughout the process, but I am still concerned about the mining.

    If we have to choose between coal and nuclear, I’d always choose nuclear. However, solar energy is more economically sound, and a large amount could be produced by individuals if a feed-in tariff were enacted.

    Even ignoring nuclear energy, the plan’s support of coal and oil is a problem.

  13. Chris Winter says:

    I differ with Joe in that I think nuclear fission power plants have a place in America’s energy future. But not existing plant designs: they use a “once-through” fuel cycle and hence are the most wasteful of fuel, requiring continuous mining, enrichment and transport of uranium as well as fabrication of the fresh fuel assemblies — all of which add to CO2 emissions. Also, the two plants currently under construction are following the too-familiar track to schedule stretchouts and budget overruns. I’d like to see more funding for advanced (generation-IV) reactor development in the U.S. But it is clear that such plants cannot go commercial much before 2030.

    The GOP energy plan does not even mention Gen-IV reactor designs (or at least the summaries don’t.) It calls for 100 new plants of existing design, which will essentially double the spent fuel volume. It proposes to deal with this by reopening and expanding Yucca Mountain (“without political interference” — so much for states’ rights.) Joe is right about this: the GOP plan would bestow upon us a fresh helping of all the problems attendant to commercial nuclear power plants from the beginning of the industry (except, arguably, the old AEC.) But I think some increase in funding for advanced reactor development would pay off in the long run.