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Missourians could see energy bill rise under cap-and-trade

Tuesday, November 3, 2009 | 12:01 a.m. CST

COLUMBIA — According to a study commissioned by AmerenUE, federal cap-and-trade legislation would cause Missourians' energy rates to increase by more than $200 annually if the state doesn't take steps to improve current energy procedures. The Joint Committee on Missouri's Energy Future heard testimony Monday on dangers of increased rates and ways to offset potential costs from the Waxman-Markey bill, also known as cap-and-trade. While a number of alternatives were discussed, all testimony touched on Missouri's main source of energy: coal.

"We're married to coal whether we like it or not," Public Service Commissioner Jeff Davis said during Monday's meeting in Columbia. Cap-and-trade would "double rates" within five to six years, Davis said, adding the legislation would provide "the largest wealth transfer in the history of mankind."

The "rate impact will be immediate and significant," said Shawn Schukar, vice president of energy delivery technical services for AmerenUE. While Schukar testified that "no silver bullet" exists to blunt the cost increase, he added that it is important to have a technological infrastructure — such as ensuring the grid is structured well — in place to deal with the new regulations.

AmerenUE Vice President of Regulatory Affairs Steve Kidwell said the "current legal and regulatory framework" of the state provides a hurdle to infrastructure investments. A partnership is necessary in order for utilities to begin investing in new technologies, Kidwell said.

Under cap-and-trade, energy companies would be required to pay the government for permits to emit carbon dioxide — a bi-product of burning coal — Schukar said in a presentation to the committee.

Gary Pendergrass, director of the Missouri Carbon Sequestration Project in Springfield, said that his project was developing ways to capture carbon emissions from coal and store them underground — an alternative to releasing them into the air.

Missouri has similar geology to other Midwestern areas that already store carbon emissions underground, Pendergrass said.

Sen. Kurt Schaefer, R-Columbia, described the project as "one of the most important projects going on in the state of Missouri right now."  The ability to store emissions from burning coal "substantially changes the dynamic" when it comes to cap-and-trade legislation, Schaefer said.

Another alternative proposed to the committee was for Missouri to rely more heavily on energy derived from landfill waste.

"It just takes trash, and we all have that," said Tom Dunne, president of waste management services for Fred Weber Inc., a landfill in Maryland Heights.

Columbia Water and Light recently made a deal with the state and Ameresco in which it will receive electricity generated from energy released by a Jefferson City landfill.

Schaefer noted that landfill gas is considered renewable under proposition C, a ballot initiative passed last November that requires utility companies to eventually use 15 percent renewable energy.

Proposed cap-and-trade legislation would affect all energy consumers in Missouri, not only those serviced by AmerenUE.

"We're all in the same boat," said Duncan Kincheloe, general manager of the Missouri Public Utility Alliance, when asked by Schaefer how cap-and-trade would influence Columbia residents.

The Joint Committee on Missouri's Energy Future plans to present its findings to the Missouri General Assembly when the next legislative session begins in January.


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Comments

Steven Hanson November 3, 2009 | 8:06 a.m.

$200 a year at current rates of consumption; ACES also gives back in the form of assistance for residential and commercial building retrofits among a host of other efficiency initiatives. So unless you don't do anything to increase your home's efficiency, you will be saving money in the long run. US EPA's analysis puts Missouri's price increase at about $85 annually, but with efficiency upgrades a savings of $750 per household by 2020. Whether it's $200 or $85, it is a small investment that should reap decent rewards.

(Report Comment)
Don't Cap and Trade November 3, 2009 | 9:52 a.m.

Tell Congress NO to largest U.S. Tax Increase Ever! Learn more at www.dontcapandtradeourjobsMO.com

(Report Comment)
Marie Fischer November 3, 2009 | 10:52 a.m.

I agree with Steven Hanson--even the highest cost estimates don't seem that high in comparison with the benefits and savings from this bill. The US Department of Energy and the Congressional Budget Office estimates--the only truly reliable, non-partisan estimates we have--put the cost of the clean energy bill at three to four dollars a month for the average American. And that doesn't include the money saved from energy efficiency measures that the bill would encourage, not to mention the income from almost 36,000 new jobs flowing into Missouri's communities.

And the only reason we're "married to coal" is that the coal companies are powerful lobbyists in Congress and our Senators and Representatives have looked out for their interests rather than ours. Coal only seems so cheap because of the millions of taxpayer dollars that have subsidized it over the years. What about the money we spend on health bills and slurry cleanup, not to mention the money we lose in property values and tourist revenues from coal pollution and ash spills? And even though our power companies want to hang on desperately to this old and dirty form of energy, Missouri's clean energy industry has already generated almost 12,000 jobs and is growing at 5.4%. No, we may not be finished with coal for a while, but that's no reason to stall on investing in wind, solar, hydro, geothermal, and the other advanced clean energy technologies that the rest of the world is far ahead of us in developing. The clean energy bill would encourage this kind of investment and innovation.

The bill also includes specific provisions for power companies that will prevent utility rates from rising
for the first few years while customers and companies make the transition to energy efficient measures and cleaner energy sources.

The national and international momentum is toward clean energy use. It's time for Missouri's power companies to face up to this reality and start innovating, rather than whining about coal. And it's time for Claire McCaskill to take leadership in the Senate, stand up to Kit Bond's dawdling, and push to pass the clean energy bill as soon as possible.

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