Investing in Cleaner Energy

Today’s Calamity: Cap and Trade Costs Fly Sky High is a blog entry of The Foundry which makes a valid point about the best route to cleaner energy technology. A bill passed by the House of Representatives known as Waxman-Markey or Cap and Trade would punish businesses with added taxes on energy useage to further environmental objectives based on assumptions that global warming would occur without these types of legal sanctions. According to a cited source Cap and Trade would add an additional five billion dollars in energy costs for the airline industry. That either makes airlines less competitive and more likely to engage in employee and other cutbacks, makes it likely that additional costs will be passed on to consumers or some of both.

The article raised another concern though, which might be an even more telling blow, based on the logic behind the bill. Income losses, in the form of increased taxes, will lessen capital available for reinvestment in more efficient energy technology. That would be the ultimate irony. A bill designed to reduce carbon emissions having the effect of making less funding available for newer and cleaner technology.

The assumptions related to effects on climate are dubious as well but that will be the focus of another blog entry.