A state by state analysis by Eugene Trisko, an attorney who often represents the United Mine Workers, conducted for American Coalition for Clean Coal Electricty (ACCCE), estimates electric power prices will rise substantially should the Environmental Protection Agency’s (EPA) clean power plant (CPP) rule be finalized.
A 2014 study by NERA Economic Consulting estimated the CPP will cause double-digit electricity rate increases in 43 states, an increase seniors’ on fixed budgets and the poor, a large percentage of which are minorities, have little room to absorb. Escalating costs could force seniors and the poor to forgo meals and doctor visits just to afford electricity – a devastating consequence that could seriously impact their health.
Trisko took NERA’s study a step further. Rather than looking at the macro-economic effects on the states, he produced a state-by-state breakdown of the costs of the CPP.
Maryland Ratepayers Hit Hard
Despite substantially lower natural gas prices and an increasing portion of electric power being provided by natural gas, Maryland has already seen its residential electric power rates climb by more than 61 percent since 2005, largely due to its renewable power mandate and its participation in a regional greenhouse gas initiative. The CPP will add to ratepayer’s burden, increasing electric power costs by approximately 11 percent annually per household. The rise in electric costs fall hardest on the poor. Households with income greater than $50,000 per year spend 7 percent of their income after taxes on energy, while households with income of less than $30,000 per year (representing 20 percent of Maryland households) spend 25 percent of their after tax income on energy. The 34 percent of Maryand household earning less than $50,000 per year spend 18 percent of their after tax income on energy. Thus, rising energy costs due to the CPP represent a particularly regressive tax.
According to Trisko’s analysis, in state after state, the impact on energy costs are the same, higher prices particularly impacting the poor.
High Costs in Florida and Beyond
In Florida, for example, where average incomes are 11 percent lower than the national average, consumers electricity prices are estimated to rise by 13 percent annually due to the CPP. While Floridians with pre-tax household incomes greater than $50,000 per year, spend 7 percent of the post-tax income on energy, households with incomes $30,000 per year or less — 32 percent of Florida’s households — spend 21 percent of their after tax income on energy.
From Alabama to Wyoming, Texas to Ohio, and Montana to Georgia and most the states in between, Trisko reports the story is the same, the CPP will increase electric power prices with the poor, minorities and those on fixed incomes bearing the brunt of higher electricity prices increased fuel costs.
Addressing the impacts of the rules on senior citizens, Jim Martin, chairman and founder of the 60 Plus Association, explained seniors are already having to make tough choices thanks to rising energy costs, but EPA’s plan “will make choices like these all too common, and will push too many of our seniors…across the line from struggling to impoverished.”
H. Sterling Burnett, Ph.D., ([email protected]) is the managing editor of Environment & Climate News.
NERA Economic Consulting, “Assessing Economic Impacts of a Stricter National Ambient Air Quality Standard for Ozone,” July 2014: http://heartland.org/policy-documents/assessing-economic-impacts-stricter-national-ambient-air-quality-standard-ozone
Eugene Trisko, “State Energy Costs for Families,” April 2015; http://www.americaspower.org/federal-issues/state-energy-cost-for-families