Bush Administration Poised to Propose Hike in Electricity Costs Larger than Tax Cut

Washington, D.C., March 9, 2001—Senior Bush Administration officials are pushing regulatory energy policies that will cost Americans more than they will gain in tax cuts. According to Department of Energy estimates, declaring carbon dioxide a global warming pollutant when produced in generating electricity would cost consumers up to $115 billion per year. The tax cut bill passed by the House of Representatives yesterday averages out to $95.8 billion per year. <?xml:namespace prefix = o ns = “urn:schemas-microsoft-com:office:office” />


“If President George W. Bush accepts the advice of these senior cabinet officials, he will have adopted former Vice President Al Gore’s favorite cause—global warming—which Bush and the Republicans ridiculed in the campaign. Regulating carbon dioxide as a pollutant will completely undermine the administration’s energy plan,” said Myron Ebell, director of global warming policy at CEI. “This is a very large bone to throw to elitist Republicans from the Northeast States, which didn’t vote for Bush.”


DOE’s Energy Information Administration released a report in December that estimates the cost of regulating carbon dioxide produced by electric utilities at $60 to 115 billion per year. “This means that the entire tax cut would be swallowed up by higher power bills. But of course, utility bills are a much higher percentage of income for poor and middle class people than for the wealthy, so lower income people will be spending more on electricity than they get back in tax cuts,” said Christopher C. Horner, policy analyst at CEI.


“If the Bush Administration is going to buy into global warming theory, then this proposed step is only the beginning. In order to comply with the Kyoto global warming treaty, we will have to make similarly expensive reductions in carbon dioxide emissions by cars, planes, and industry,” Horner concluded. According to Horner, White House insiders indicate a deal was struck with some utilities that see a way to profit from such a regime, and environmental groups as a trade-off for not derailing efforts to drill in the Arctic National Wildlife Refuge (ANWR).


“What’s most worrying about the proposal to regulate carbon dioxide is that many in the Bush Administration don’t seem to realize that such a small step will be very costly, but will do nothing to address the alleged problem of catastrophic global warming. The administration should decide whether it believes in global warming or not. They shouldn’t take halfway measures that would do nothing but would still have to be paid for by American consumers,” Ebell concluded.



For interviews, please contact Jody Clarke or Richard Morrison with the media relations department at 202.331.1010. For interviews over the weekend, please call Myron Ebell directly at 301.322.6157 or Chris Horner at 202.262.4458.