Bipole disorder: It's not too late to go down the east side!!!

I am glad that Welch wrote her synopsis of Hydro's state of affairs. Allow me to comment of a few of her points:

on power rates:
"lawyer Williams said there could be a debate that starts percolating over just what Manitobans ought to pay for power -- the cheap rate we pay now or something closer to the real market value, which might spur people to conserve their megawatts."

Start percolating? Get with the program already. It's been debated on the internet many times already. YES we should be paying market rates, at least on marginal power consumption. If you maintain low rates on the first 200 kwh or so, and jack up the rates on the incremental consumption, you'll promote conservation without hurting the low incomers. You can employ market forces while feeling all warm and fuzzy about protecting the vulnerable people. That's the best of both worlds for a liberal province.

on wind power:
I don't know what's going on here, but there obviously isn't any motivation to make this happen. "The Doer government has promised to build another 600 megawatts of wind power." He also promised to get rid of hallway medicine. Next ...

The dams:
" 'We've got a lot of stuff going on, but everything seems to be under control,' said Hydro CEO Bob Brennan," who added: "NOT"

Cap and trade:
I am generally a fan of market-based mechanisms like this, but I was listening to a dude who works in the power industry in Vancouver and in his opinion there are major flaws with this plan. I must do more research to comment on this.

Bipole III:
"The province did finally table long-awaited legislation to help protect the east side's boreal forest from development, paving the way for a UNESCO World Heritage site and effectively killing any chance of a power line down the east side."

Grrrrrr. This is sooooo annoying. For those who are not familiar with the facts of the issue, let me summarize:
1. The east side of the lake aleady has development in the form of logging and mining and other such things. A new road is being proposed to access remote communities. The bipole line would not damage this area to any significant degree, and therefore this area does not need "protecting" any more than the Upper Fort Garry gates needed protecting.
2. The proposed west-side route will fell near as many trees as the west side route due to the longer distance. Some of those trees may be in protected aspen parklands. Plus, accoring to Jim Cotton (on some previous post), there is already a wide swath of land cleared down the side of the lake.
3. The Bipolee III power line does not preclude qualification for UNESCO membership, nor does the absence of said power line guarantee membership.
4. UNESCO membership means bugger all. What is it going to do? Fill the forest with eco tourists? No. The same hunters and fishers will visit the area then as they do now. Jake and Margaret from Vermont aren't going to vacation in the middle of a mosquito infested forest because it has a UNESCO designation. And the question has to be asked: do we even want tourists in this pristine area? Would it be better protected by keeping it below the radar? Why is this designation so important?
5. The proposed west-side route is far more expensive to build. According to Welch: the PUB "is a little worried about Hydro's financial future." As am I, by the way. Which is why I don't think we should be wasting hundreds of millions of dollars on a longer path for Bipole III.
6. The west-side route will waste thousands of megawatt-hrs of electricity per year, resulting in the loss of around $7-15m per year according to my calculations here, not to mention a shit load of GREEN power. If you are at all concerned about the environment, you should be outraged by this callous waste of green electricity. Every megawatt wasted will be replaced by dirty power somewhere down the line.

It's not too late to reverse this idiotic decision!!!

Carbon Tax: Part II

In my first post about the carbon tax we learned that

1. the conservatives initially seemed to be doing a pitiful job of fighting the carbon tax, but maybe good enough. (More likely, the Liberals are just not doing a good enough job of selling it.)
2. it takes me two months to draw a single-panel editorial cartoon.
   

In this post, I intend to talk about the actual program. In fact, I had intended to dig up some of my old studies and notes from Environmental Economics where we discussed this shit, but as usual I'm too damn lazy. It was mostly math anyhow.

If I can recall a few key things from those classes, one on them is that market-based mechanisms are far superior to non-market regulations. It is more efficient because the marginal cost of reducing emissions is determined by the market. Co. A may be able to reduce emissions at a lower cost than Co.B, therefore they will reduce more and Co.B will reduce less, to the point that their respective marginal costs are equal. In the end the same amount of emissions are reduced but at a lower cost than if the government regulates A & B to reduce X amt.

Put one check on the scorecard for carbon tax for being market based. (I should mention here that I am not going to get into the climate change debate. What matters here is that most people believe that climate change is happening, and is at least partly a result of emissions, so the question is: what it the best plan to reduce emissions?)

How well will the Carbon tax work? The plan proposes the following:

• $40/tonne tax on coal, natural gas, etc.. (after four years)
  
• 7 cents/l tax on diesel (after four years)
• no tax on gasoline.

With no tax on gasoline, the plan obviously will do sweet bugger-all to reduce emissions from cars. I suspect the tax on diesel will do likewise. I don't see trucking companies changing their behaviour for a 7 cent tax, given the large increases that they've already seen in the price of fuel. Indeed, the transportation sector is largely unaffected, even though they are a major source of emissions.

Most of the revenues will come from the $40 tax on other fuels. In particular, a "significant majority" will come from the larger corporate energy users. The degree to which this will cause them to reduce their emissions is difficult to say. It should have an impact, but there are lots of variables.

The "tax less of what we do want" part of the equation is what makes this plan "revenue neutral". While I don't disagree with the principle of a revenue neutral plan, this is hardly revenue neutral at the individual level.

The big losers: businesses. While a large majority of the tax revenue will come from businesses, they will benefit from less than 25% of the tax cuts.

Who are the big winners? Families and poor people. In addition to the lowest tax rate decreasing 1.5%, and the next two brackets going down 1%, we find these other items tucked away in the green plan:

• a child tax benefit of $350/kid
• replace $1000 employment tax credit with a $1850 refundable credit for incomes of less than $50,000
• increase in working tax benefit for low income workers.
• disability tax credit for low income disabled people.
• rural credit of $150
• increase in northern resident reduction
• increase in guaranteed income supplement ($600) for low income seniors
• new guaranteed family supplement for low income families (up to $1225)
• increase in National Child Benefit Supplement for families b/w $21k & $26k
  

I have to wonder: what is this really about? The tax excludes some of the biggest sources of emissions, has an unknown impact on actual emissions, but includes a big income shift from corporations to individuals. Is this really about saving the environment, or is this a robin hood scheme?

My personal opinion is that, if you want to reduce emissions, tradeable emissions permits are the way to go. Like carbon tax, they are market-based. Unlike carbon tax, they can produce specific results. What tradeable emissions permits do not do is give the government an opportunity to buy off low income voters under the guise of saving the environment.

Carbon Tax, Part 1

I had the idea to draw this cartoon about two months ago, shortly after Stephan Dion announced that he was hitching his wagon to the carbon tax, but I didn't get around to actually drawing it until now. The point at the time was to show that, while it is very admirable of Dion to commit to something that is very likely to be unpopular because he presumably believes it is the right thing to do, I thought it would sink his hopes of ever being PM. I saw it as being a hail Mary pass -- one last long bomb with the green football to see if he could pull out a miracle victory after letting the opponent run all over him for the first 59 minutes of the game.

That's not really how it's turning out. Dion and the Liberals are hanging right in there in the polls, and the "green shift" is not getting the negative reaction that I'm sure the Conservatives would love to see. Why? I think it's because Harper doesn't know how to fight it. Harper has ripped a page from the Hugh McFadyen campaign playbook by insulting the intelligence of the electorate with talking oil spots, and radio ads featuring a fake call-in show with bad actors. Harper is at his best when he approaches a subject in a cerebral and logical manner. Saying that the tax will "screw everybody across the country" falls far short of that. Unless he can find a way to explain the flaws of the carbon tax to average voters (without using the word "screwed"), or better yet - explain why his program is better, then this election battle will be a tough one for him.

I'll write a post a bit later (if I have time) about the carbon tax itself. À la prochaine ...

update: I may have spoken a little too quickly: Support for the Liberals' Green Shift dropping: poll