When the Obama administration revealed a plan last week to force power plants to dramatically cut carbon emissions, some Californians gloated. “Climate plan should be a breeze for California,” read a front-page headline in the Los Angeles Times. The thrust: California has been throttling carbon emissions for years. We’re way ahead in all this.
Well, yeah. But California also is way ahead in charging its people and businesses much more for electricity.
According to stats from the federal government’s Energy Information Administration, if you were to move to Arizona, your residential electricity rate would be cut 27 percent on average. If you moved your commercial operation to Nevada, you’d save 36 percent. And if you moved your industrial concern to Texas, assuming your use remained the same, your electric bill would be chopped in half.
Cutting carbon emissions may be what a majority of Californians want to do, and many are proud of that. But what often gets ignored in all the pompon shaking is that green electricity costs a lot of green. And it will get even pricier in California as Gov. Jerry Brown is pushing his plan to double down on carbon eradication. Some day you may hear this: “Gramps, is it true that average electricity bills were only, like, $500? Boy, those must’ve been the good ol’ days.”
Very high electricity rates may seem a mere trifle to wealthier folks who live in the A/C-free zone along California’s coast. But for businesses, especially those inland and those that are big kilowatt consumers, it’s an important matter. Every additional dollar spent on electricity is a dollar it cannot spend on expansion, it cannot spend on an increase in wages, it cannot spend on a new hire. Every utility bill becomes a monthly reminder that financial struggles would be reduced, maybe eliminated, in another state.
(I know what some of you are thinking: If the Obama administration’s rules come to pass, then other states will have to raise their electricity rates, too, and they’ll be in the same proverbial boat as California. But that seems doubtful. After all, there is no guarantee that the new rules ultimately will be approved. And even if they are, they may be watered down in the process or overturned later. And even if they do pass as presently envisioned, California’s rules will likely be stricter, making the state’s electricity still more expensive.)
Higher electricity rates are especially tough on the poor. A report came out two weeks ago from the Manhattan Institute that focuses on what it calls “energy poverty,” which it defines as having to spend more than 10 percent of total household income on energy.
A high number – 4.9 percent – of Californians spend 10 percent or more just for electricity, the report concludes. Add in the cost of natural gas, and 7.4 percent of Californians live in energy poverty. Again, we’re just talking utility bills, here; the report didn’t touch the cost of gasoline.
Let’s underscore that: One in 20 Californians devotes 10 percent or more of their total household income each month just to pay their electricity bill. This is the flip side of cleaner electricity.
Not surprisingly, those living in energy poverty may be invisible to the state’s wealthier people because they are clustered in the central valley and other inland areas – places where incomes are lower and air conditioning needs are higher. Los Angeles County is about at the state average; energy poverty diminishes or disappears along the coast.
Reducing carbon may be a goal and really squeezing it out of our lives may be ideal. But this is just a reminder: It’s very expensive to do that. Paradise comes at a price.