03.21.2011 - by Richard Kelly
We Need Real Energy Pricing

Fukishima nuclear plant Japan. Credit: Moneyweek

In “The Real Price of Energy”, which appeared in Friday’s Los Angeles Times, and can be read here, Ronald Brownstein argues that the price of oil, and electricity from nuclear or coal, fails to reflect the cost of catastrophic disasters, or chronic environmental harm.

Federal oil drillers are liable “only for $75 million in damages after a spill.” And attempts to raise this to a more realistic level have been blocked by politicians. In the case of a nuclear accident, the plant operator is liable for $375 million, and the industry picks up the next $12.6 billion.

In both cases, taxpayers pick up the remainder of the tab, which as we’ve seen with the Gulf oil spill, and the Fukushima partial meltdown, may be much higher than ever anticipated. So this cost is external to the price we pay at the pump or in our electric bill. But we do pay for it in our taxes and/or national debt.

We at Plug In America have long argued that plug-in cars are already more efficient than convential vehicles even using today’s grid. But they really shine when paired with renewable energy like wind or solar. (see our energy policy)

In light of Japan’s continuing unfolding nuclear catastrophe, and new reports that oil is still spilling in the Gulf, it’s worth considering what might change if realistic energy pricing was in effect.

  • All energy plant operators would have to run safer operations, because there would be no artificial limit to their liability in case of an accident.
  • Consumers would have the incentive to switch to cleaner energy, and to tackle those energy-efficiency projects that previously may not have “penciled out”.
  • Government subsidies, which are pretty unpopular in the current economic climate, could be ended. No need to subsidize wind and solar if you’ve leveled the playing field by pricing nuclear, coal, and oil-based energy properly.

Sounds like a win-win. Joseph Aldy, until recently the chief environmental economist for President Obama recently said of energy, “doing things that get the price right is a really important next step in our energy policy.” I too would like to see this happen.

4 comments on “We Need Real Energy Pricing”
  1. Anonymous says:

    I agree with your main premise. However, if we pay the true cost of energy, aren’t plug-in-hybrids with single occupants unsustainable? Isn’t the true answer to our energy problems to reduce our use to a fraction of current discounted consumption by decreasing commutes and eschewing the single occupant automobile as a transportation mode? Of course, the elephant in the room is overpopulation. Rather than suggesting that the solution to our energy and climate change problems is a mass die-off of 6/7 ths of the worlds human population, I would suggest that we embrace a sea change in our energy consumption paradigm.

    I used a converted electric vehicle 5 years ago. It consumed most of the electricity produced by my 4 kw rooftop solar panels. This brought into focus for me that driving around in a ton and a half vehicle doesn’t make sense.

    Find a job close to home or move close to your job. Walk to work or ride a bike. Use a scooter or moped to run errands. Or better yet walk. Leave the car at home. Plug-in hybrids will not unfortunately solve the poor choices we made as a society during an age of cheap energy. They will only delay the inevitable. However, I wish you, and all of us humans, the best of luck.

  2. I agree — we need real energy pricing. Oil spills, exploding mines, mountaintop removal, gas fracking, and nuclear waste storage, etc. all cost a LOT more than we think.

    http://www.wbur.org/2011/04/04/nuclear-waste

    Nuclear costs billions for even just “temporary” storage. The environmental costs alone of all these are staggering. We are “eating” oil, almost literally. Crop failures due to climate change are already a large cause of instability around the world.

    Sincerely, Neil

  3. Edwards EEV-3 EV Quantim Leap says:

    To: Whom it may concern
    For: The American People.
    From: Edward Heath Owner/Operator of New Ideas and Innovations, LLC
    e-mail: edwardselectriccar@yahoo.com address; P.O. Box 171, North Branford, Connecticut 06471 – 9998

    Hello Americans; my name is Edward and I believe that I have the technologies needed for “Sustained Ultra-Extended Electric Vehicle Travel”! (SUEEVT) If you are tired of paying $50.00 or more for a fill-up (gasoline or diesel) for your vehicle then I might have the solution and I am asking for your help. I am seeking a total of $ 4.8 million dollars for research / development and to build prototype vehicles (bought off the dealers lot, not custom made –like Tesla, Coda, Leaf, etc.) to prove my technologies work; (I know it sounds like a lot of money and it is, but it also goes quite quickly- but not to me but for the business, I can assure you of that). The funds would go to the shop, vehicles (initially named EEV-3 for Edwards Electric Vehicle, and the 3 stands for the three different energy forms saved or conserved while driving the EEV-3 and they are: coal, crude oil and natural gas), machinery, equipment, CAD/CAM software, international patent protection, components / parts / assemblies, employee payroll and other operating expenses. I request amounts between $1.00 and $100.00 or whatever amount you are happy with. Please send check or money order to address above with your name and address so that I may send you a thank you card. The U.S. Government, Venture Capital / Angel Investors, and vehicle manufacturers do not want to assist me in my endeavor so I humbly ask for your much appreciated assistance in this very serious matter! I have been pursuing financing for over a year now. They are all afraid of “big oil” companies. I am not. Big oil usually equates to big trouble. ‘Can you say’ “greed” and “Lobbyists” who are only concerned for their well being and not for the well being for us as a country, they are very selfish!
    If you have any questions, please feel free to send me an email to: edwardselectriccar@yahoo.com . I have a provisional patent on this project patents on other energy and / or natural resource conserving innovations and I am a serious innovator, I am not a nut, a scammer or a thief; far from it. I am trying to use my intelligence and engineering experience to make our country great again and to greatly reduce our dependence on foreign oil from countries that do not like us. This technology will not lose jobs (not even for the oil companies because we as a nation still need kerosene, heating oil and gasoline for small engines), but rather would increase jobs here in the States by having at least one electric vehicle conversion center in each state. That is something that we do not have right now. The conversion to mostly electric vehicles would take 5-7 years, not just a couple of years.
    I thank you for your financial assistance, especially during this recession and tough economic / financial times! The payoff would be fantastic for our country though if I can prove my technologies by driving across America in one of the EEV-3 retro-fitted vehicles in 3 or less charging cycles! People would not be afraid in purchasing electric vehicles equipped with this technology. By the way, in case you were wondering, my technologies are NOT based on the principles of “perpetual motion”. My company has been around for 5 ½ years, working on technologies that save good Americans as yourself, money, energy and / or natural resources like our clean fresh water. Please help the United States (U.S.) and us as Americans regain our strength as world leaders in national security and innovations that help all of us live better lives, now and for generations to come!

    Thank you all again for your understanding and assistance!

    Sincerely and Honestly Submitted: Edward Heath – Owner / Chief Design Engineer of New Ideas and Innovations, LLC

    Edward Heath _______________________________

  4. Paul Scott says:

    So nice to see this issue being discussed more and more. We absolutely need to price dirty and dangerous energy according to its cost to society and the environment. Unless and until this is done, we’ll make slow progress toward a renewable energy world.

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