My Take On Ohio’s Energy Efficiency Fiasco

DUKE001Robert Michaels wrote an interesting post on Mercatus called Ohio’s Energy Efficiency Fiasco. Since I complained about rising electrical rates in 2012 and 2013 I was fascinated that a Northern Virginia college would publish a paper by a professor of economics at California State University about Ohio electrical rates. Talk about strange bedfellows! In 2012 I was ready to complain to state officials about the electric rate increase when I realized that my problems were pretty minor compared to problems faced by several public school districts whose budgets were blown out of the water with the rate increase. Despite all of the fervor I can say that not much has changed. My bill is much higher and Duke is inordinately interested in getting me to buy light bulbs from them. Here is the junk mail I got from Duke last week. So what could have gotten Mr. Michaels and Mercatus all upset?

It seems that Mr. Michaels is concerned about free riders. Here is an example.

Free riders are subsidized by higher bills for other consumers. Despite hopes that the EERS would encourage efficiency innovation that would produce “green jobs,” since the EERS became law there has been very little such innovation. Instead, utilities have relied heavily on lighting-related discounts for compliance. For some utilities in some years these discounts have accounted for more than 80 percent of EERS expenditures.

RateChange1The problem for these utilities is that I still have plenty of CFLs I bought three years ago so I do not need anymore. He also complains about “riders” added to the distribution portion of the electrical bill to satisfy the whims of certain advocacy groups. My latest Duke electric bill shows that the combination of the delivery and generation riders is now 42% of my delivery charge. It really irks me that my electric bill keeps going up despite lower fossil fuel costs and improvements I made in energy efficiency. The problem is with distribution rate increases. Here is a graph of my annual electrical rate increases. It looks like the stupidity has subsided so why is Mercatus still interested?

I think Mercatus is interested in the legislative fight to alter the renewable and energy efficiency mandates in Senate Bill 221 enacted by legislators in 2008. Many states have similar mandates but Ohio seems to be particularly foolish in writing S.B. 221. The supporters of S.B. 221 say these subsidies have created a renewable energy industry and the bill was about creating jobs. State Senator Bill Seitz begs to differ and told members of the Senate Public Utilities Committee, “Simply put, the economic projections upon which (S.B. 221) was based have turned out to be wrong.” I think the quickest way to get up to speed on the economic predictions upon which S.B. 221 was based is to read Jonathan Lesser’s study, Ohio’s Electricity Usage Reduction Mandate: The “Free Lunch” Paid for by Ohio Consumers. In that article Mr. Lesser says that since S.B. 221 mandates reduced electrical usage, it expects that electrical generation rates will go down. The economic logic used to justify S.B. 221 is that since the retail customer is saving money on these presumed generation rate decreases they can easily afford to subsidize renewable energy and energy efficiency projects paid for by the riders included in the distribution rates. The problem is that delivery rate increases far exceeded any savings I got from generation rate decreases. If the only renewable energy job created is to send me junk mail about CFLs, I think we can safely say that it has failed and it is time to work with businesses to change the renewable and energy efficiency mandates. The good people of Ohio can only go so far with bad legislation.

Half of the particulate pollution in North America comes from other continents

According to a new study by researchers at the University of Maryland, College Park, NASA Goddard Space Flight Center, University of Maryland at Baltimore County and the Universities Space Research Association:

Roughly half the aerosols that affect air quality and climate change in North America may be coming from other continents, including Asia, Africa and Europe, according to a new study.

Most of the pollution migrating into the North American atmosphere is not industrial emissions but dust from Asia, Africa, and the Middle East, , Yu found. Out of the total annual accumulation of foreign aerosols, 87.5 percent is dust from across the Pacific, 6.25 percent is composed of combustion aerosols from the same region and 6.25 percent is Saharan dust from across the Atlantic.

Although they did not discuss the ratio of dust to combustion aerosols from North America, I would not be surprised if the ratio was even larger for particulate pollution in North America. In a previous post, The Battle over Clean Air Standards, I found it easy to conclude from the EPA site on asthma that combustion aerosols have a weak link to asthma. If dust is the major contributor to our problem with particulates then the regulations on coal plants are a very small part of the solution. Every time I look at the science behind the increased coal plant regulations is I find the argument for stronger regulations is just not there.

Half of the particulate pollution in North America comes from other continents
Wed, 22 Aug 2012 23:07:07 GMT

Why are Distribution Costs going up so fast?

In my last post of energy conservation, June Follow up on Green Technology that pays for itself, I was surprised to find that my energy savings were being overwhelmed by electrical rate increases. This bothered me on several different levels. Naturally I was disappointed I was spending more for the same amount of electricity while my wages stagnate. The more curious problem was why did my rate go up when the price of natural gas and coal go down?

Yesterday I went through my electrical bills and added up my delivery and generation costs for the first five months of the year. I divided these two numbers by the total electricity used to come up with an average delivery and generation rate. I did the same for the first five months of last year, too. My delivery rate went up 18.3% while my generation rate went down ”“17.7%. The lower generation rate makes since it was highly influenced by the higher winter rate in January and February of 2011. The higher delivery rate does not make sense. This increase is much higher than inflation. What did Duke spend the money on?