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Energy Dominance at Stake in the Midterm Elections

November 1, 2018

Climate Change Weekly #304

Editor’s Note: Promoting energy dominance and climate realism always features prominently in The Heartland Institute’s work, and they are also front and center in the 2018 midterm elections. This special issue of Climate Change Weekly is devoted to energy initiatives and ballot proposals being considered in this election that could harm people, jobs, and the economy by dictating people’s energy choices.

Voters in states all across the country will soon decide whether they want the economic gains achieved under the first two years of the Trump administration to continue and expand. It all comes down to how they vote on energy issues.

Steyer at Work

A former coal profiteer and now a progressive green energy maven, California billionaire Tom Steyer is trying to take California’s energy policies on the road. California’s energy prices are among the highest in the country, and Golden State residents suffer more non-disaster-related electricity blackouts and brownouts than any other state. In a vain effort to control the weather 100 years in the future, California has adopted policies restricting fossil-fuel use and severely limiting residents’ energy choices. The result: high energy prices and unreliable electricity.

At a time when residents and businesses are fleeing California to seek more affordable energy and homes, Steyer is trying to export California’s misguided energy policies to other states. Voters in Arizona and Nevada will consider ballot proposals mandating an increase in the proportion of electricity generated from renewable power sources to 50 percent by 2030. Both measures are bankrolled by Steyer.

Interestingly, as Steyer tries to spread his message of energy restrictions beyond California, Golden State voters will consider Proposition 6, a ballot initiative this November to roll back a 12 cents-per-gallon tax on gasoline passed in 2017 as part of Democratic Gov. Jerry Brown’s efforts to fight climate change. Earlier in 2018 in a recall election, California voters removed a state senator who voted to raise the state’s gas tax. Sen. Josh Newman (D-Fullerton) lost his state Senate seat when 59.5 percent of those voting in his district approved his recall on June 5. Newman had served half of his four-year term. With Proposition 6 on the November 6 ballot, California voters have a chance to rescind the gas tax increase.

Nevadans Consider Steyer Energy Mandate

In Nevada, the Steyer-funded climate interest group, Nevadans for a Clean Energy Future, gathered enough signatures to have Question 6 placed on the November ballot.

Currently, about 20 percent of Nevada’s energy comes from renewable sources. The state’s renewable energy mandate requires 25 percent of the electricity provided by utilities in the state come from renewable sources by 2025. If voters approve Question 6, the amount of renewable power utilities would be required to provide would double to 50 percent by 2030.

Because Question 6 would amend Nevada’s constitution, voters would have to approve the initiative a second time in 2020 before it becomes law, if they vote in favor of it this year.

Over the past five years, the average Nevadan’s electric bill rose by 11 percent, even though rates fell on average by 1 percent, nationally, and declined even more in states without green-energy mandates. This is due in part to Nevada’s existing renewable energy mandate.

A 2013 study commissioned by the Nevada Policy Research Institute showed simply meeting the current requirement (utilities get 25 percent of the electric power they supply by 2025) would probably raise power prices by 11 percent. This would cost the state more than 3,000 jobs. Requiring 50 percent renewable energy just five years later, after the low-hanging “inexpensive” power switching has already been accomplished, will make rates and job losses skyrocket even further.

Interestingly, also on Nevada’s ballot is an initiative to require the legislature to open up the state’s energy markets to competition. Nevadans passed this initiative in 2016, and if it passes again this time, it becomes part of the state’s Constitution.

As Texas’ example shows, when electric power markets are opened to competitive market forces, with multiple suppliers competing on fuel source, price, and terms of service, consumers win with greater reliability, more choice, and lower prices. If Nevadans adopt the 50 percent renewable mandate, the benefits of completion will be reduced because power suppliers will be unable to compete by using low-cost fossil fuel sources of electric power. Instead, prices will rise and reliability will suffer because the renewable sources are more expensive than traditional sources of electric power and the power they supply is intermittent.

Arizonans Consider Steyer Mandate

What’s true of Nevada is true of Arizona as well. Clean Energy for a Healthy Arizona, an organization funded almost entirely by Steyer, gathered sufficient signatures to get Proposition 127 placed on the November ballot. Proposition 127 would require Arizona utilities to generate 50 percent of their electricity through renewable energy sources such as solar and wind by 2030.

In an interview with Environment & Climate News, Arizona state Rep. Mark Finchem (R-Tucson) said the renewable power mandate was pushed to enrich a politically connected elite, not to benefit Arizona power users.

“Unfortunately for Arizona ratepayers, there is a campaign of dishonesty underway to promote the interests of a few, who stand to become even more insanely wealthy than they already are,” Finchem said. “This is not about clean energy; this is about the greed of the billionaires club.

“If adopted, Prop. 127 would tie Arizona’s future to technologies that do not deliver baseload electricity and are arguably worse for the environment as a whole than the dependable technologies we already have,” Finchem warned.

Research indicates Arizona’s electric power costs will rise if voters approve Prop. 127. Arizona currently produces 7 percent of its energy from wind and solar, which the state requires be increased to 15 percent by 2025. The Energy Information Administration reports meeting the 7 percent requirement has already added $304 a year to the average Arizonan’s electric bill. Meeting the 50 percent standard proposed in Steyer’s ballot initiative could cost Arizona residents an additional $2,100 annually.

In addition, The Seidman Research Institute (SRI) at Arizona State University found the requirements of the 50 by 30 initiative would cause Arizona to lose $72.5 billion in gross state product between 2018 and 2060, with Arizonans having $42 billion less in disposable personal income over that period. SRI’s analysis also predicts a loss of $5.8 billion in combined state and local taxes through 2060, including $1.7 billion in lost property taxes, causing an $858 million loss in school funding.

Carbon Dioxide Tax Rises Again in WA

If voters in the state of Washington approve Initiative 1631, the state the will become the first to impose a tax on carbon dioxide emissions and the first government anywhere to impose the tax through a direct popular vote. If 1631 becomes law, commercial, industrial, and transportation-related emissions of carbon dioxide will be taxed at $15 per metric ton on, with the tax rising by $2 per ton each year until the state meets its goal of reducing emissions 50 percent below 1990 levels by 2050. If the state fails to meet its 2050 targets, the tax could continue to increase indefinitely.

The state government has projected the carbon dioxide tax would increase gasoline prices by 13 cents per gallon and home heating oil costs by 15 cents a gallon in 2020, the year the tax takes effect. The results will be higher taxes, higher energy costs, and, if every credible analysis of carbon dioxide taxes is right, higher unemployment as companies relocate out of state or close due to lower-cost competition from companies out of state. That will reduce the state’s GDP. Only anti-growth, anti-progress zealots will win if Washington voters approve initiative 1631.

The state’s voters wisely rejected a carbon dioxide tax ballot initiative in 2016. In 2017, Washington state courts nixed a carbon dioxide regulatory fee Gov. Jay Inslee (D) attempted to impose through state agencies he controls, and the legislature declined to adopt its own version of a carbon dioxide tax in 2018. Yet, just like a vampire in a bad horror movie, carbon dioxide taxes keep being resurrected by anti-fossil fuel zealots in Washington state.

Colorado Initiative Against Fracking

Colorado’s days as a growing producer of oil and natural gas will be numbered if voters in the state approve a ballot initiative severely restricting extraction on nonfederal land on November 6.

Initiative 97, promoted by the environmental group Colorado Rising, would establish a minimum setback for new oil and gas wells of 2,500 feet, up from the current 500 feet from homes or other occupied dwellings and 1,000 feet from schools. The proposal would effectively place four out of every five acres of nonfederal land in Colorado off-limits to new oil and gas drilling. The setback limit would not apply to wells or to leases on federal land.

Because of the fracking boom, oil production in Colorado rose from an average of 10.4 million barrels per month in 2016 to 13.2 million barrels per month in the first quarter of 2018, making Colorado the seventh-largest oil-producing state in the country, the Colorado Oil and Gas Conservation Commission (COGCC), the state agency charged with regulating the industry, reports.

In July, COGCC announced Initiative 97 would eliminate drilling on 94 percent of all nonfederal land in Colorado’s top five oil-producing counties. The result: state and local tax revenues would decline by $201 million and 33,500 to 43,000 jobs would be lost in the first year alone. The Colorado Oil and Gas Association, which opposes Initiative 97, has estimated Colorado will lose 147,800 jobs, with people losing $147.6 billion in personal income by 2030, if voters approve the 2,500 foot setback. In addition, the state will forego $218 billion in state GDP, and state and local governments will not realize an expected $9 billion in tax revenue between 2019 and 2030.

With those implications for jobs and government revenues, Initiative 97 has garnered rare bipartisan opposition in the 2018 election campaign, with both candidates for governor—Republican Walker Stapleton and Democrat Jared Polis—opposing the initiative.

The cost to Colorado and the state’s taxpayers could be even higher because the measure would almost certainly face court challenges, including lawsuits from property owners newly forbidden from developing oil and gas projects on their land. Those with existing wells receive substantial revenue from oil and gas production on their lands.

On this point, it is particularly noteworthy property rights activists successfully placed an initiative on the November 2018 ballot, Amendment 74, which would allow property owners to make claims for just compensation for any reduction in property values resulting from new regulations. The proposal would protect water and mineral rights in addition to physical property. It could be applied to losses stemming from Initiative 97 if both propositions succeed, meaning Colorado taxpayers could face billions of dollars in compensation payouts.

Florida Offshore Drilling Ban

Florida voters are being asked to consider Amendment 9, which would encode in the state’s constitution the current state law banning offshore oil and gas drilling in state waters, making it harder to change.

Florida can’t block the federal government from allowing drilling in far-off federal waters, but it does ban drilling three nautical miles from the shore along the Atlantic coast and nine nautical miles along the Gulf of Mexico. Amendment 9 would the current state policy in place. Oddly, Amendment 9 would also ban workplace vaping, a completely unrelated issue.

Proponents of the offshore drilling portions of Amendment 9 say it is a way of preventing Florida’s legislature from allowing expanded offshore drilling, which the Trump administration is encouraging. The Florida House voted to repeal the ban on drilling in state waters in 2009, but the state Senate did not approve the measure.

Energy Dominance, Freedom on the Ballot

On the national stage, President Donald Trump’s plan for energy dominance could be furthered or set back based on the results of this midterm election. Recognizing energy is the lifeblood of the economy, Trump has taken concerted steps to reduce regulatory barriers to domestic energy production throughout his first two years in office. Trump’s policies have paid off with the highest economic growth and lowest unemployment in decades, tracking the growth of domestic energy production and use. This progress could be brought to a screeching halt if energy-hostile candidates for state and federal office are elected in November.

Rep. Tulsi Gabbard (D-HI) introduced the OFF Fossil Fuels for a Better Future Act (OFF Act) with relatively little public notice in September 2017. The OFF Act would require “100 percent renewable energy by 2035 (and 80 percent by 2027), places a moratorium on new fossil fuel projects, bans the export of oil and gas, and also moves our automobile and rail systems to 100 percent renewable energy.” The lobbying group Food & Water Action has called the OFF Act “the most aggressive piece of climate legislation ever introduced in Congress.” The bill has little support in the current Congress, having lingered in committee for more than a year without a hearing since Gabbard introduced it.

This his could change if partisan control of Congress switches after the midterm elections. Media darling and self-described socialist Democratic congressional candidate Alexandria Ocasio-Cortez of New York supports the OFF Act’s goals. The climate and energy section of Ocasio-Cortez’s website says, “Climate change is the single biggest national security threat for the United States and the single biggest threat to worldwide industrialized civilization.” To reduce that purported threat, Ocasio-Cortez proposes the United States transition to a 100 percent renewable energy system by 2035, which is what the OFF Act would require.

The OFF Act has received support from hundreds of Democratic Party candidates for local, state, and federal office in 2018, who have signed a pledge, developed by Food & Water Action, to push for passage.

The fate of U.S. energy dominance and continued economic progress are truly at issue in this election. It puzzles me that so many people are embracing the failed doctrine of socialism, and being lauded for it by so many in the press, when it is perfectly clear that socialist regimes around the world have perpetrated unmatched repression and reduced those nations’ economies to ash.

Socialism kills. From the former Soviet Union to Cuba to North Korea to Venezuela, anywhere socialism has been tried, it has robbed people of freedom and their property, produced economic stagnation and misallocation of resources, and directly or indirectly resulted in millions of deaths.

Energy socialism, as evidenced in state ballot initiatives limiting people’s energy choices and candidates embracing top-down, big-government energy diktats, would be just as deadly.

Truly, our vote matters, so support energy freedom! I know I am.

  • H. Sterling Burnett

SOURCES: https://ballotpedia.org/2018_ballot_measures; http://www.governing.com/topics/transportation-infrastructure/gov-florida-offshore-drilling-trump-ballot.htmll; Environment & Climate News; Research & Commentary; Environment & Climate News; Environment & Climate News

Author
H. Sterling Burnett, Ph.D. is a Heartland senior fellow on environmental policy and the managing editor of Environment & Climate News.
hsburnett@heartland.org

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