Environmental externalities: Thinking globally, taxing locally
Assigning monetary externality values to the airborne emissions of electric power plants is gaining the attention of state utility commissions as a means to measure the social costs of alternative energy investments. Some commissions are using environmental externalities to encourage utility investments in energy conservation and renewable energy technologies such as solar, wind, and biomass. However, the monetization of externalities through so-called adders to direct generation costs can lead to inefficient resource allocation and expose consumers to electric rate increases without corresponding environmental benefits. The addition of externality values to direct electric generation costs distorts the economics of power supply planning by creating artificial subsidies for generation sources that are not currently competitive in the market. Businesses and consumers will be forced to support higher-cost sources of electric generation as a consequence. Because pollutant emissions of all new sources of electric generation are stringently regulated, and generally are well below those of existing fossil-fired sources, little demonstrable environmental benefit would result from the expanded use of externality valuation.
- OSTI ID:
- 6499433
- Journal Information:
- Public Utilities Fortnightly; (United States), Vol. 131:5; ISSN 0033-3808
- Country of Publication:
- United States
- Language:
- English
Similar Records
Issues and methods in incorporating environmental externalities into the integrated resource planning process
Impacts on least cost planning and system operations of monetizing environmental externalities
Related Subjects
POLICY AND ECONOMY
ELECTRIC UTILITIES
PRICING REGULATIONS
TAXES
POLLUTION REGULATIONS
ECONOMIC ANALYSIS
STATE GOVERNMENT
BIOMASS
CARBON DIOXIDE
COAL
DIESEL FUELS
ENVIRONMENTAL IMPACTS
GASOLINE
GREENHOUSE GASES
HEATING OILS
NATURAL GAS
NITROGEN OXIDES
SOLAR ENERGY
SULFUR DIOXIDE
US CLEAN AIR ACT
WIND POWER
CARBON COMPOUNDS
CARBON OXIDES
CARBONACEOUS MATERIALS
CHALCOGENIDES
DISTILLATES
ECONOMICS
ENERGY
ENERGY SOURCES
FLUIDS
FOSSIL FUELS
FUEL GAS
FUEL OILS
FUELS
GAS FUELS
GAS OILS
GASES
LAWS
LIQUID FUELS
MATERIALS
NITROGEN COMPOUNDS
OXIDES
OXYGEN COMPOUNDS
PETROLEUM
PETROLEUM DISTILLATES
PETROLEUM FRACTIONS
PETROLEUM PRODUCTS
POLLUTION LAWS
POWER
PUBLIC UTILITIES
REGULATIONS
RENEWABLE ENERGY SOURCES
SULFUR COMPOUNDS
SULFUR OXIDES
296000* - Energy Planning & Policy- Electric Power