A thoughtful, well grounded op-ed by former state rep Doug Gablinske in Thursday’s Providence Journal, who makes the reality case that the electricity to be generated by the proposed Burrillville power plant is very much needed.
Thanks to efforts to restrict the development of a piece of land in Tiverton, a government casino and hotel became its best use.
You may have been keeping half an eye on the proposed power plant that a firm called Invenergy would like to build in Burrillville. Friday, the Providence Journal reported that
Invenergy has failed to sell the second half of the power output of its proposed fossil fuel-burning power plant in Burrillville to the regional electric grid.
Opponents of the proposed plant understandably view this development as good news. However, it is not a fatal blow for the proposed power plant, as the article notes.
Further along, the article also notes that New England has had 4,200 megawatts of generating capacity taken off line (my observation: this happened in large part due to out-of-control EPA regulations by the Obama administration), and another 6,000 megawatts are at risk of going off line. Accordingly, many of us are concerned about the cost and continued adequate supply of electricity.
Environmentalists believe they have the answer.
But opponents of the plant say that renewable sources can fill in any need for new power in New England.
Yikes. Sorry, no, that is simply not the case.
Contrary to the implicit beliefs of environmentalist zealots, this is a good thing:
… rates for all of 2016 were generally low throughout New England. Mild weather and the lowest natural gas prices since 1999 drove overall wholesale energy prices to their lowest point since 2003, according to Gordon van Welie, president and CEO of ISO-New England, the operator of the regional power grid.
Despite the fact that low energy costs help people, especially the poor and working class, the Left wants to close down power plants, like the one at Brayton Point in Somerset and to prevent new sources of energy, like the proposed natural gas plant in Burrillville.
Unfortunately, it isn’t clear that the general public makes the connection between environmentalism and energy prices strongly enough for a reasonable balance to overcome heated rhetoric and numbers games.
Climate alarmism seems to raise more questions than it answers, and here’s one: If we should charge traditional energy companies for global harm, what other industries (e.g., Hollywood) do demonstrable harm and ought to be taxed accordingly?
In India innovation is turning coal exhaust into baking soda; in Somerset, environmentalists are turning waterfront property into a useless plot of land that is a drag on local taxes and the economy.
Ah, the tender extremism of the Environmental Protection Agency, as John Daniel Davidson writes on The Federalist:
… now comes the federal government to tell the inhabitants of Alaska’s interior that, really, they should not be building fires to keep themselves warm during the winter. The New York Times reports the Environmental Protection Agency could soon declare the Alaskan cities of Fairbanks and North Pole, which have a combined population of about 100,000, in “serious” noncompliance of the Clean Air Act early next year.
Read the whole thing, but in sum, according to Davidson this is a local problem isolated to an area that people can choose to leave. The writer, for one, is willing to take the health risks associated with some wood-fire-related pollution for the benefits of life in the area, but the distant federal government isn’t willing to allow him that option.
Like much progressive, big-government action, the effect of this regulation (intentional or not) will be to limit the places humanity can settle… except, naturally, those privileged few with money to burn. To be sure, it must be difficult for federal bureaucracies to tell people how to live their lives when we’re so spread out into the wilderness.
Indeed, one finds it difficult not to see a deliberate restriction of human freedom if the picture combines Davidson’s explanation of the energy challenges in the region…
Heating oil is too expensive for a lot of people, and natural gas isn’t available.
… with the EPA’s restrictions and President Barack Obama’s imperial ban on oil drilling along Alaska’s coast.
In The Titanic, one passenger laments that there aren’t enough lifeboats for half of the passengers, and the movie’s wealthy villain proclaims that it won’t be “the better half” who are stranded. Think of government as a crew both steering toward an iceberg and restricting access to escape and you’ll have something of the sense of how progressive policies function.
Much to the detriment of the state’s rate payers, Deepwater Wind began generating electricity on December 12. Less than three weeks later, one of its five turbines broke (oopsie). As though wind energy isn’t already expensive enough, now we have to add the cost of making repairs thirteen miles out on the ocean. (‘Cause the cost of water and seawater-related repairs is always very reasonable, right, boat owners …?)
It probably was not a coincidence that the company made this embarrassing admission on a day – the Friday before Christmas – sure to glean the absolute minimum amount of public attention.
A University of Rhode Island physics professor’s attempt to use environmentalism in Woonsocket to attack capitalism instead raises questions about his credibility and that of Marxist environmentalism worldwide.
The big dirty little secret about renewable energy is that it is very expensive. Pointing to the “extraordinarily poor value” of return BY THE EPA’S OWN STANDARD in carbon footprint reduction, the Rhode Island Center for Freedom and Prosperity earlier this year called on the State of Rhode Island to significantly roll back renewable energy mandates.
Fast forward to last week. The Empire Center for Public Policy’s Kenneth Girardin alertly spotted that the State of New York has done almost exactly that for 2017.
The state Public Service Commission has quietly reduced the amount of renewable energy that utilities will have to purchase next year by 94 percent, according to PSC documents.
Kudos to New York for quietly modifying their mandate to conform with reality, even if it’s just for one year. For the sake of their already over-burdened ratepayers who have no obligation to fund pointless, feel-good, very expensive energy sources, Rhode Island and all other states need to follow suit, and not just for one year.
By now, the Trump transition team has promised that it has “properly counseled” the staffer who asked for names of people involved in certain of the Environmental Protection Agency’s activities, but it remains a telling incident:
The official said questions about professional society memberships and websites that staff at the Energy Department’s national laboratories maintain or contribute to could raise questions about Trump’s commitment to scientific independence – a fundamental tenet at the agency. …
Democrats have called the questionnaire a modern-day political witch hunt that could have a chilling impact on federal workers.
Gee. If anything, that sounds less aggressive and presumptuous than the Obama administration’s treatment of Tea Party groups in the run-up to his reelection campaign. The main difference: Those were private citizens being harassed by the IRS on the president’s behalf. If there’s any harassment with the EPA request, it’s the people’s elected president harassing out-of-control agencies. That’s kind of how representative democracy ought to work.
Journalists put Republicans and conservatives on the record about a list of topics; why shouldn’t Democrats and progressives be challenged for association with racists who foment violence?
Most of the links I’ve collected over the last couple of days for further consideration and possible posting have had to do with national politics, and I’m not much in the mood to join the chorus, right now. I will say, though, that the implications of the election are encouraging, irrespective of the president elect (that is, if he stays out of their way).
A pivotal moment came for me the other evening when I heard Rudy Giuliani discussing possible appointments that might fill out the Trump administration. For most of them, it was a reminder that, before they backed Trump in the first place, I liked how most of these people approach policy issues. This positive reminder has been reinforced by talk from the other side. Here one clip from several local environmentalists’ press releases, which Alex Kuffner cut up and reprinted as a Providence Journal article:
“With an uncertain future and a federal government now determined to stop us at every turn, the innovative environmental work happening on the local and regional level is more important than ever,” said Josh Block, press secretary of the Conservation Law Foundation.
Sure, it’s a call to keep local funding going for crony projects and activism for economic deterioration, but if it’s not being pushed and largely funded from Washington, D.C., maybe Rhode Island can have an actual discussion of the policies. Similarly for education:
Tim Duffy, the executive director of the Rhode Island Association of School Superintendents, worries that Republicans, who now control the House and Senate, will make good on their threats to cut federal spending on education, and possibly move to abolish the Department of Education in its entirety. …
Another area of uncertainty is school choice. Trump has proposed $20 billion to expand school choice for low-income children. Students could use the money to attend private, charter and traditional public schools of their choice.
Even the possibility that the federal government might put families first by skipping over the corrupt and inefficient educational bureaucracy to give federal education resources directly to families who need them is tantalizing. As is this, via email, from Providence Mayor Jorge Elorza:
These results, and the current state of our nation, present a new opportunity and responsibility for cities to play a much larger role in shaping our democracy. As the mayor of Providence, I commit to doubling down on my efforts to advance a society that is inclusive, compassionate, and forward-thinking.
Yes, yes, he’s talking about “doubling down” on a worldview that is destructive and inimical to freedom and self actualization, but maybe without the federal government imposing progressivism from above and funding activists with tax dollars, we can actually make key decisions at the local level, where they ought to be made.
Nobody should be surprised when our dishonest president-elect looks for ways to back out of difficult promises, but even if his administration only partially reins in the corrosion and abuse of our civic system, we’ll be entering a new era.
I’ve been meaning to note this American Interest post, providing more evidence that the way forward — even if climate change alarmists have a point — is not to slow the economy, but to let it loose to advance and bring technology with it:
… it was coal’s sharp decline—a drop of 18 percent in the first half of this year as compared to 2015—that really moved the needle on America’s energy emissions. And let’s not forget that Old King Coal isn’t being dethroned by onerous regulations, but rather by market forces. More specifically, coal’s demise has been precipitated by the sudden rise in domestic natural gas production that has led to an oversupply (and, as a result bargain prices). This, of course, comes to us courtesy of the great shale revolution.
Anybody who insists that the environment’s salvation must come through heavy public subsidies of a few favored technologies and restrictions of everything else, along with increasingly centralized power to restrict people’s behavior, isn’t in it for the environment, but for power and, very likely, for a cut of the subsidized profits from those favored technologies.
Over the past few decades, multiple movies and TV shows have used plot devices in which the money men invested in old energy sources conspired to undermine fashionable technologies like wind and solar. I don’t think I’ve ever seen show that portrayed “renewable” industrialists conspiring to prevent fossil fuels from becoming less of an environmental problem of themselves.
Ask yourself this: How would environmentalists and progressives respond if some technological innovation made coal less carbon-intensive than wind and solar and still less expensive? Would they shift their support to that new technology or continue insisting that “renewables” were the only hope for humanity?
For most, I suspect, the question is rhetorical, because they’re either on the take or in a cult.
Here’s the sort of news (via Instapundit) that keeps a lot of us skeptical of efforts to use warnings about “global warming,” “global cooling,” or “climate change” as justification for radical changes to our economy and society:
In a new twist to waste-to-fuel technology, scientists at the Department of Energy’s Oak Ridge National Laboratory have developed an electrochemical process that uses tiny spikes of carbon and copper to turn carbon dioxide, a greenhouse gas, into ethanol. Their finding, which involves nanofabrication and catalysis science, was serendipitous.
Sure, this is a long way from techniques for capturing atmospheric carbon; the only application mentioned in the article is the conversion of excess energy from periodic energy sources (like solar and wind) for storage. But in a world in which alarmists declare that it’s already too late to avoid the harmful effects of human activity in the past, any action taken that slows the economy in the name of the environment will inevitably restrict research and development that may — serendipitously — solve the very problems about which we’re being warned.
Three Brown faculty members traffic in questionable statistics in an apparent push to end the deadly scourge of days that are “merely warm.”
In America, we must all remain free to voice our opinions without fear of state-sponsored persecution. It is reprehensible for any political elitists to collude to prosecute those who disagree with them on policy. For this reason, the Center is assisting a national nonprofit organization in a lawsuit demanding that the Rhode Island Office of the Attorney General release documents they have refused to make public. We believe that General Kilmartin, and his fellow enemies of debate, are seeking to maintain a cloak of invisibility over the national AG group’s attempt to crush dissent by those who disagree with their radical climate change agenda.
In June, the Center published an energy report that demonstrated how oppressive state renewable energy mandates, as part of the national climate change agenda, will cost taxpayers and ratepayers hundreds of millions of dollars. These mandates will cause job losses in the thousands, and artificially raise local electricity rates. It is research and advocacy such as this that Kilmartin and his AG group are seeking to muzzle and potentially prosecute as criminal. No matter where you stand in the climate change debate, citizens must have the right to speak freely.
This culture of silence in the Ocean State is chilling. Why do so many elected officials and prominent people want you to be quiet? The rigged system protects the corrupt insiders. As we saw in the recent 38 Studios political whitewash, the machine will do what it takes to keep you from knowing the truth. Rhode Islanders want a government that works for everyone not just the chosen few. Things do not have to be this way in our state. We can have an open state government that serves the real needs of our families, and protects our freedom to achieve our dreams.
Elected officials saying things are getting better in Rhode Island is not enough, they must take action. We need action. Unless the Ocean State adopts the proven free market reforms that can transform our state, we will continue to see the negative trends continue. You can change the status quo. You must not allow anyone to silence you. By speaking out on the issues that affect your family, you can make a powerful statement to the insiders that you have had enough. Now is the time to be bold, and have our public policy culture make a complete turnaround.
[Mike Stenhouse is the CEO of the Rhode Island Center for Freedom and Prosperity.]
Kevin Mooney has picked up, for The Daily Signal, the story about an open-records-related lawsuit against Rhode Island Attorney General Peter Kilmartin. In brief, Kilmartin’s office has signed an agreement to work with other attorneys general and environmental activists to target companies and organizations on the other side of public debate about climate change and related public policy, with a further agreement to keep the larger agreement and correspondence secret. One problem with that:
If Kilmartin and the other attorneys general prevail in the deal to keep select details secret, the ordinary citizen will be the loser, Chris Horner, a leading critic of climate change orthodoxy, said.
“It will mean that they can create privilege for what are otherwise public records, even when shared with ideological activists and donors, so long as everyone who wants to keep their scheming secret agrees in advance,” Horner told The Daily Signal.
That’s not the only way for government officials to keep things secret. I’ve been writing about the efforts of the Employee Retirement System of Rhode Island (ERSRI) and General Treasurer Seth Magaziner to withhold from me the total amount of pension promises to which the state is committed, efforts in which the attorney general’s office is now involved. In that case, the state government is making the ludicrous claim that, because a private actuary has the data, might have to perform a simple calculation, and might charge some price to produce the results, getting it would implicitly be an “undue burden,” thus creating an exemption from the law. That is, even if the costs would be small and the people requesting the information were willing to pay the fees, public agencies do not have to release public information as long as they use an outside company to process it.
With that massive loophole in mind, turn to an essay from May by Hans Von Spakovsky and Tiger Joyce. As part of this very same effort of state attorneys general to go after political opponents in the name of climate change alarmism:
Some state attorneys general are hiring profit-seeking, private-sector personal-injury lawyers to do their legal dirty work. Moreover, any contingency fees collected by these lawyers through settlements arising from these cases could be used, in part, to fund the campaigns of allied politicians who embrace the “one, true belief” of man-made global warming.
Unfortunately, the Department of Attorney General does not appear to be included in Rhode Island’s transparency portal, so there’s no immediate way to dig into Kilmartin’s expenditures with private firms, but even if the state has not yet reached the point of paying hired bounty hunters to track down those lawless climate change deniers, we can certainly include this whole corrupt effort on the list of ways in which government at the state and national levels has left the road along which the people can safely feel as if they are legitimately governed.
Mark Zaccaria suggests that Sen. Sheldon Whitehouse should back away from his attacks on Constitutional rights and focus on making a positive difference in people’s lives.
There’s a certain irony, here. Rhode Island’s far-left Democrat Senator Sheldon Whitehouse is leading the charge to criminalize research and expression of views that don’t fit his extreme ideological and political view and a gang of thuggish attorney generals have been coordinating legal attacks on fossil-fuel companies and conservative think tanks on the claim that they’re engaged in an anti-environmentalist conspiracy, and yet the attorneys general are hiding their coordination from the public.
A press release from the RI Center for Freedom & Prosperity (for which I work) notes its participation in an effort to ensure a little bit of transparency into this actual conspiracy:
The RI Center for Freedom & Prosperity (Center) announced that it assisted a national nonprofit organization in a lawsuit, filed today, demanding that the Rhode Island Office of the Attorney General (OAG) release documents they have refused to make public. The legal complaint calls for the release of documents related to AG’s United for Clean Power, a group comprised of politically-motivated AGs from about a dozen states, including Rhode Island, who have secretly teamed up with anti-fossil fuel activists to investigate dozens of organizations that have exercised their free speech by challenging the global warming policy agenda. …
In a series of April emails obtained by E & E Legal, the RI OAG consented to sign-on to an “agreement” among the larger AG cabal that is colluding to investigate if RICO statutes may have been violated. However, the Rhode Island AG now refuses to make public the group’s ‘Secrecy Pact’ documents related to that taxpayer funded activity.
That is, the attorney general will not release the terms of his office’s agreement or even the text of the documents pledging to keep that agreement hidden.
All eyes on Philadelpha and the Democrat convention, of course. Thanks to Wikileaks, by the way, for furnishing an interesting Rhode Island connection for us all to speculate on.
Meanwhile, it’s important not to totally lose sight of stuff going on back in Rhode Island. The debate about a natural-gas powered electric plant proposed for Burrillville, for example, moved into the arena of the PUC this week.
The hearings are set to run Monday, Tuesday and Wednesday and will differ markedly from the public hearings that have been held so far on the application, which gave Burrillville residents and others the opportunity to air their opinions and concerns about the power plant but didn’t allow for any back and forth.
On Thursday, Governor Raimondo called into the WHJJ Morning News with Ron St. Pierre to defend her support of the plant. (Podcast.) In doing so, she said
Well, I support natural gas because I support lower energy costs and lower electricity costs for Rhode Island.
That’s a pretty categorical statement. Yet only seven months ago, the Governor signed an Executive Order
… committing state agencies to get 100 percent of its power from renewable sources by 2025
Further, in February,
A bipartisan group of 17 governors, including Governor Raimondo, have signed a pact agreeing to work together to build modern, sophisticated transmission grids and to advance clean energy and transportation technologies. Called the Governors Accord for New Energy, the agreement includes commitments to diversify energy generation and expand clean energy sources …
All of these actions by Governor Raimondo are a big problem for everyone’s electric bill and a huge conflict with what she said on WHJJ. Because the dirty little not-so-secret about renewable energy is that it is far more expensive than conventional energy. Further and worse, as an important new report by the Rhode Island Center for Freedom and Prosperity demonstrates, the state’s continued pursuit of renewable energy would come at a high cost to ratepayers and taxpayers while providing an extremely poor return on greenhouse gases abated BY THE EPA’S OWN STANDARDS. In fact, the cost of renewable energy to Rhode Islanders could be as much as five times higher than the EPA recommends.
The Governor seems to want to manage her stance on energy in silos. “I’ll support the gas powered energy plant and say that I support lower electric rates and that will cover me with a lot of Rhode Islanders. Meanwhile, I’ll aggressively push renewable energy mandates onto ratepayers and taxpayers and that will satisfy the environmentalists.”
But it does not work that way, on any level. Firstly, the walls of the silos are not opaque. So everyone, whether inside a silo or outside of it, can see what she is doing in all of them. Far more importantly, the effect of her actions in one silo do not remain contained therein: what she does in one – the renewable energy silo, in this case – will most definitely have the effect – higher electric rates – that she claims to deplore as she’s standing in another.
Her words, to phrase it more plainly, do not match her actions. And that’s a real problem for the ratepayers (let’s remember, this category includes businesses) of a state that has some of the highest electric rates in the country. They very much need her actions – a wholesale repeal, not an expansion, of very expensive renewable energy mandates – to match her words when they open their electric bills every month.
Rhode Island Democrat U.S. Senator Sheldon Whitehouse has repeatedly shown that he’s got no problem using government to go after people and groups he perceives as political enemies. He’s sympathetic to the literal conspiracy of attorney generals to prosecute those who take a different view on the question of climate change, and now he’s coordinating a smear campaign from the floor of the Senate.
Whitehouse’s office circulated assignments for his fellow Democrat senators for a two-day extravaganza of attacking private center-right think tanks and advocacy groups, from the local (Nevada Policy Research Institute) to the national (Heritage Foundation), from the morally focused (Acton Institute) to the libertarian (Reason Foundation).
To be sure, much of this is the pure stagecraft of politics, but it ought to, in any event, make us a little uncomfortable. The senators are using a government podium to embark on a coordinated attack on Americans, dividing the country as if their domestic opposition is the real enemy. One could suggest that it would be incorrect to see Whitehouse as representing all of Rhode Island. He represents a specific worldview, and he’ll use our money and other resources to advance that worldview and impose its conclusions on everybody who live within the borders of his reach.
English has multiple words by which to describe that sort of behavior.
With one of our U.S. Senators’, Mr. Sheldon Whitehouse (Democrat, naturally), being a key figure in the fascist effort to pursue legal persecution of people who have a contrary opinion to him on the politically charged issue of global climate change, Rhode Islanders might be interested to hear that some of his allies are backing away from his level of aggression, as the Wall Street Journal notes (text here):
Virgin Islands AG Claude Walker recently withdrew his subpoena of Exxon Mobil. He was a leader among the 17 AGs charging that the oil giant defrauded shareholders by hiding the truth about global warming. That’s hard to prove when the company’s climate-change research was published in peer-reviewed journals.
Mr. Walker also targeted some 90 think tanks and other groups in an attempt to punish climate dissent. These groups and others, including these columns, pushed back on First Amendment grounds, and the Competitive Enterprise Institute counter-sued Mr. Walker and demanded sanctions. He pulled his subpoena against CEI last month.
The real shame, and the real warning sign, is that those AGs, and fellow travelers like Whitehouse, weren’t instantly lambasted by people across America’s political spectrum for even initiating such patently offensive-to-freedom steps .
In this podcast excerpt, I discuss with the Heartland Institute’s Donald Kendal and John Nothdurft the findings of the Rhode Island Center for Freedom and Prosperity’s new report on renewable energy that confirms a very poor cost-benefit return to Rhode Islanders of renewable energy. (Listen to the full podcast of our conversation here.)
Because 98% of Rhode Island’s energy is generated by natural gas, our state already has a comparatively small carbon footprint. Further reducing it to hit purely arbitrary renewable production targets would cost state ratepayers and taxpayers $141–190 million per year in production expenses alone – four to five times the EPA’s recommended cost standard.
Rhode Islanders also cannot afford the cost to the state economy in the form of lower employment levels or in the $670–893 million per year extracted in unnecessarily higher electricity rate payments by private sector businesses and families. When will the status quo learn?
Based on these findings, the Center has strongly recommended that lawmakers reject all proposed new energy mandates and, instead, repeal those that are currently written into law. The EPA’s own cost standard highlighted in the Center renewable energy report demonstrates that state officials can set aside all renewable energy mandates with a clear conscience.
It is well but perhaps not as widely known as would be desirable for a fully informed discussion on the subject that renewable energy is far more expensive than conventional (fossil fuel) energy sources. Further to this point, the RI Center for Freedom and Prosperity has released a report with the helpfully descriptive title: “Renewable Energy in Rhode Island: Big Cost, Little Difference”. (Link to the full report in PDF here.)
The report points out that by the EPA’s own standards, the cost of Rhode Island abating carbon from its energy supply would far exceed the benefits that would accrue to the state.
Because of this poor cost-benefit “value proposition,” up to five times less than the Environmental Protection Agency (EPA)–suggested standard, Rhode Island should reconsider its existing energy policy approach.
Let’s repeat this very important point and its source. By the measure of the EPA, not exactly a research arm of the vast right-wing conspiracy, it simply is not worth it, in terms of the carbon that would be abated, for Rhode Island to put renewable energy on its grid.
With this information, elected officials – Governor Raimondo and members of the General Assembly – can no longer in good conscience advocate or vote for renewable energy in Rhode Island. In fact, just the opposite, as the Center calls for: renewable energy mandates must be rolled back.
Based on this study’s findings, the Center strongly recommends that lawmakers reject all proposed new energy mandates in 2016 and, instead, repeal those that are currently written into law.
Here’s a quote from Speaker of the House Nicholas Mattiello (D, Cranston) that one doesn’t expect to read in Rhode Island. On the topic of a cut to funding of the Office of the Health Insurance Commissioner (OHIC), as reported by Lynn Arditi:
“When the money runs out the programs are off,” House Speaker Nicholas A. Mattiello said during a budget briefing last week. “Every time a federal grant expires everybody wants the funding to continue. You have a government that Rhode Island cannot afford.”
Of course, as Andrew’s charts make clear, the overall level funding of government arises only because an increase in local funding made up for a loss of federal revenue, but at least the speaker is articulating important points.
Also from Mattiello, yesterday, was a statement that the green-energy article of the House budget would be removed altogether. Many on the right have seen that as a good sign, but note this sentence in the statement (emphasis added):
Over the past several days, I have received feedback on Article 18 and have reached the conclusion that there are pieces of the article that do not need to be in the budget.
Most of the legislation in Article 18 was already submitted as bills in the House and Senate. For example, the RI Center for Freedom & Prosperity’s Freedom Index shows that the controversial energy-producer interconnect component of the article has already passed the House as H7006.
So, again, at least we’re getting evidence that sounds of reality and reason are penetrating the State House walls. Whether they’ll have a real effect (or produce consequences if they don’t), we’ll have to wait and see.
Despite disturbing new revelations and renewed public criticism about insider legislative grants, cronyism appears to be alive and well at the Rhode Island State House. And once again, Ocean State families and businesses would be asked to foot the bill.
In the budget that got voted out of the Finance Committee early Wednesday morning, alert observers spotted and brought to the attention of the RI Center for Freedom and Prosperity as well as the Ocean State Current on Friday an extensive revision to Article 18.
They are correct to loudly ring warning bells about it. If it stays in, state electric ratepayers are in for even higher electric rates than they currently pay.
Here’s a hypothetical: State legislators create an unaccountable bureaucratic board and, over time, invest it with power to make increasingly minute and economically significant decisions affecting private businesses. After an extended and costly ordeal, one such business resolves to address an abuse that its leaders see as affecting not only its own bottom line, but the future of its entire industry.
Lobbyists and political donations are almost universally despised, but they are the the way the system works, and the business utilizes them. Legislation it proposes to rein in the power of an insider-tied public utility and the unaccountable board make it nearly to the point of passage by being placed in the House’s revision of the budget.
How should free-market, small-government conservatives react to this sequence of events? Apparently, if the business in question is a renewable energy company, it’s a story of cronyism on the part of the business. I’d suggest that conservatives should temper the broad indictments of the system they’re making about the story of Wind Energy Development and House Finance’s Article 18.
Yes, there’s clearly an immediate benefit to Wind Energy if this article passes, but here’s the first provision of the relevant section of the budget article:
The electric distribution company may only charge an interconnecting renewable energy customer for any system modifications to its electric power system specifically necessary for and directly related to its interconnection. Any system modifications benefiting other customers shall be included in rates as determined by the public utilities commission.
I have to admit: that sounds reasonable to me. Switch the details around a little. Imagine a manufacturer wants to set up a new energy-intensive factory in the wilds of Southwestern Rhode Island, and the current practice of National Grid and the Public Utilities Commission (PUC) would be to force that company to pay 100% for upgrades to any part of the power grid that its increased usage might affect, even if a particular bit of the infrastructure were on track for a scheduled upgrade the following year, anyway.
Would we characterize it as cronyism if the company took its case to the General Assembly through the usual means, asking only to pay for modifications “specifically necessary for and directly related to” its business?
There is, of course, a bit of justice to the PUC’s ruling. National Grid should be making upgrades anyway (with the urging of the PUC), perhaps with money that it currently funnels to insider green-energy deals. That would create a healthier business and residential environment for all of us. One could see the Wind Energy ruling as a sly way of redirecting some of that cronyism to the public good.
But let’s be careful about our generalized proclamations. When a near-government entity like an electric company conspires with an unaccountable bureaucracy to tilt deals away from private companies, the recourse should be to the legislature. Maybe we don’t like the players in a particular case, but we shouldn’t attack broad principles for a particular contingency.
This part of Benjamin Riggs’s post in this space earlier this morning justifies some further thought, with an eye toward understanding how government spreads public resources to serve the public good:
Since the power to be generated would benefit everyone in New England, but the effects on quality of life, real estate values, and the rural nature of the area would be imposed mainly on the residents of Burrillville, clearly they are entitled to full compensation for the contribution they would be facilitating for the general good.
Put this idea of compensation in context of controversial legislation to give Burrillville residents a say on any tax deals that the government might enter with the energy plant. When one hears about tax deals between government and businesses, we typically think of special abatements that spread the business’s tax burden to other taxpayers, at least for an introductory period.
Even where the tax deal is a positive amount for taxpayers, one still must ask whether it’s positive enough, and other taxpayers should arguably have a say. That is, if the theoretical cost to the locals is higher than the negotiated tax windfall (or if that windfall is somehow redirected to government, not the people), then it’s still not a good deal.
Personally, I’m a big believer that government is not appropriately our mechanism for telling our neighbors what to do with their property, which is why some local conservatives see the aforementioned legislation as a naked attempt to kill the power plant. Presumably, though, there’s some point at which a majority of voters in Burrillville will assess any harm from the plant to be less than the benefit of accepting it.
Those of us who ponder policy for a living should come up with an innovative solution, here. Rhode Islanders, especially, have good reason to doubt the intentions of state and local politicians when they negotiate special deals with deep-pocketed corporations, so the power to negotiate such deals should be restrained. Perhaps the answer is to revisit the way in which we assess the value of property for tax purposes so as to incorporate the value of the plant to the entire region into its taxable property.
To be extreme for the purposes of illustration, imagine if the regional good of the energy that it could provide made the power plant worth 80% of the full value of the town’s total property. That would mean that other taxpayers’ property would only have to generate 20% of the tax revenue the town requires, which would theoretically drop its tax rate to about one-fifth of its current level. And if the assessment isn’t negotiated, but rather a formula founded on some underlying principle of value, the opportunity for corruption and abuse would be minimized.
Given the realities of economics and pollution, blocking a natural gas plant in Burrillville isn’t a very good strategy if the goal is to fight climate change.