Nobody likes higher prices. But higher prices for an absolute necessity like energy are more than just an annoyance.
Energy price increases have been outstripping seniors’ Social Security cost of living adjustments for a decade now. Unfortunately, that trend is likely to get worse, with much higher electricity prices on their way right here in Colorado.
Since oil, natural gas and coal prices have all been falling recently, it may seem odd to be predicting another energy price hit. But it’s not the market that will drive prices higher.
The U.S. Environmental Protection Agency has announced a plan to cut carbon dioxide emissions from America’s power plants by 30 percent by 2030. Colorado’s target is even higher, at 35 percent. The impact of this and other rules coming out of Washington on climate change is unknown. But the impact on the electric power industry and prices is all too clear.
In the first half of 2014, American household electricity prices jumped by more than 3 percent, according to the U.S. Energy Information Administration.
Colorado succeeded in holding the line and keeping power prices below the national average, mainly because the state gets almost two-thirds of its electricity from low-cost coal. That is likely about to change.
Since 2012, six of Colorado’s coal-fired power plants have shut down. Two more are scheduled to close by 2017. Together, those eight plants account for 1,000 megawatts of generating capacity, enough to power about a million households. The EPA’s new plan will only accelerate the closures and the result will be a rapid rise in electricity prices.
To be clear, Colorado’s utilities won’t bear the burden of higher electricity prices — instead that cost is going to be passed right onto you.
How much is the cost of electricity expected to rise? A recent study from Energy Ventures Analysis —an energy consulting firm that supports the electric natural gas and oil, coal and renewable power industries — shows that under the EPA’s new plan wholesale electricity prices in Colorado are expected to spike at least 26 percent by 2020.
All the while, as Coloradans and Americans across the country pay the price of EPA action, global carbon emissions will continue to rise.
Emerging economies are connecting tens of millions to the electricity grid for the first time each year. Millions more are purchasing their first cars. China, not the U.S., is the world’s largest carbon emitter.
Believing regulatory action in one country can address a global challenge is foolish, dangerous for our economy and unfair to those, like so many of our seniors, who are already struggling to get by.
According to a 2010 survey conducted by the nonprofit the Applied Public Policy Research Institute for Study and Evaluation, high energy prices already have forced more than 40 percent of low-income seniors to go without needed medical or dental care, and even to skip meals or shut off the heat on cold days.
The EPA’s narrow focus on reducing carbon emissions, despite the costs, is a grave mistake. Affordable, reliable energy must always come first.
Jim Martin is chairman of the non-partisan 60 Plus Association, a seniors advocacy group with a free enterprise, less government, less taxes approach to seniors’ issues. He has submitted comments to the EPA regarding the agency’s proposed carbon emission regulations for power plants and has advocated for of seniors having access to affordable and reliable electricity on Capitol Hill and at the National Press Club.
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- On January 13, 2015