We can see the t-shirt slogan already: I paid $58,000 for solar panels and all I got was a $21 carbon credit that bought me this t-shirt. It’s not very catchy, but that’s the story of a Harrisburg couple, Tami and Randy Wilson, who installed solar panels in their home to reduce their electricity bill:
The Pennsylvania couple has sold the world’s first carbon credit awarded for a reduction in personal carbon emissions. About 1,800 others have signed up to follow suit – underlining the US public’s readiness to press ahead on the issue. The Wilsons began by getting rid of their son’s heated water bed, turning off power to computers and televisions when not in use, changing to energy-efficient light bulbs, hang-drying their laundry and, finally, investing $58,000 in a solar panel system – until they reduced their electricity bill to zero.
Then they signed up on the MyEmissionsExchange.com site to have their energy savings calculated. They found that they had already saved one tonne of carbon, which earned them a carbon credit. The exchange sold the credit for $21.50 to Molten Metal Equipment Innovations of Ohio, taking a 20 per cent commission.”
Make that $17.20 for the t-shirt after subtracting the exchange’s take. But if we wanted to have some truth to a t-shirt for the Wilsons, it would read: Thank you taxpayers for paying for $36,000 of our investment and thanks federal government for creating an artificial market for carbon dioxide credits. The Wilsons received an $18,000 federal tax credit and an $18,000 rebate check from Pennsylvania’s state government and also expect to collect $2,700 in renewable energy certificates.
If the Wilsons or any other family wants to invest in solar panels or windmills to save money, they should be permitted to do. But they shouldn’t do it with the taxpayers’ help. There’s a reason renewable energy only meets a very small portion of our energy needs. Wind and solar cannot survive without preferential treatment through subsidies, mandates and tax breaks. Take away those government handouts; do the Wilsons still make that $58,000 investment? There’s a big difference between a $19,000 investment and a $58,000 investment.
Tami Wilson said, “It takes a trigger point to get people involved. For us it was the announcement of a 30 per cent increase in our electricity bill.” That’s the point of government policies like cap and trade; after all, President Obama said that under his cap and trade plan, “electricity prices would necessarily skyrocket.” The goal is not only to raise the price of energy high enough for people to use less of it, but also to distort the market in such a way to make renewable energy prices able to compete in the market.
The Wilsons expect to sell renewable energy certificates to carbon-emitting companies that need to meet government mandates and will recover their investment in six years. Unfortunately, the American taxpayers cannot make such a claim.
Other people are getting paid by the federal government so why shouldn’t we? That’s the sentiment coming from the forest industry over reducing carbon dioxide emissions. This is how a bad bill becomes a bad law. When there’s money up for grabs, special interests and their lobbyists swarm like bees to honey seeking to protect or improve their bottom line. Inevitably, few win at the expense of many. And when you can get paid not to do anything, all the better. Jessica Leber of E&E (password required) reports:
About 15 of the 50 coalition members are spending this week arguing that 5 percent of cap-and-trade revenue be devoted to domestic forest and land conservation. That’s compared to about 1.2 percent proposed by Sen. John Kerry (D-Mass.) and Sen. Barbara Boxer (D-Calif.) and on par with the money slated to protect rain forests outside of U.S. borders.
Advocates say they want the funding to stem decades of forest losses fueled by struggling landowners facing intense pressure to harvest their trees or sell to housing developers. [..] Landowners already stand to gain through a climate bill’s offset program, under which they could sell credits to balance fossil-fuel emissions under a carbon cap. A proposal by Sen. Debbie Stabenow (D-Mich.), which could be folded into a final Senate bill, includes a beefed-up domestic offset program with a specific carve-out for farm and forest projects.”
Laurie Wayburn, president of the conservation group Pacific Forest Trust said, “In the energy and alternative energy sectors, the public is investing a great deal in helping entrepreneurs develop technologies that reduce carbon emissions. Land does this naturally, but it doesn’t do this for free. Landowners can’t do this just out of their goodwill.” Wade Mosby, a senior VP for a timber company echoed Wayburn’s sentiments, saying, “I think we’re providing a lot of environmental benefits to the entire public, but we don’t get paid for it.”
So who would get paid for and who wouldn’t? Do you only qualify if you have more than ten acres of forests? Are trees that capture more carbon than others worth more? Do synthetic trees count? With the trillions of dollars in carbon (energy tax) revenue available through a cap and trade system it’s no wonder the forestry industry is chomping at the bit.
If there’s a market for conservation, it should be driven by the private sector, not a newly-created, artificial market for a clear, odorless gas that will be funded by all Americans. Pacific Forest Trust, for instance, makes payments to a tree farm “in return for an agreement to never subdivide its land and always maintain a sustainable forest.” Nature Conservancy and Ducks Unlimited purchase land to create and protect habitats and establish wildlife preserves. Ironically, environmentalists are challenging Ted Turner’s attempt to save wildlife. The billionaire is seeking to restore bison wildlife through buying property in Montana before the remaining 88 bison from Yellowstone National Park are slaughtered.
This rent-seeking strategy of invested companies and individuals is keeping the idea of reducing carbon dioxide emissions alive and well. Now it’s just a matter of convincing the queen bee they deserve more honey.