Cooler Heads Digest 17 December 2010


The Cooler Heads Digest will take next week off, in order to celebrate the holidays. It will return the following Thursday, December 30. Have a Merry Christmas.

The Tax Foundation has released a new study that compares energy subsidies across nations. To read the report, titled “IEA Study Ranks Nations' Subsidies to Fossil Fuel Consumption,” click here.

The George C. Marshall Institute this week released a new paper examining the viability of electric cars. To read “Electric Cars: Not Ready for Prime Time,” click here.

In the News

The Congressional Research Service’s Dirty Little Big Green Secret
Ron Arnold, Washington Examiner, 17 December 2010

Duke Energy’s Bad Bet
Chris Horner, Planet Gore, 15 December 2010

Wikileaks Climate Cables Show Obama’s Desperation
John Rossomando, Daily Caller, 15 December 2010

Budget Hawks Oppose Nuclear Loan Guarantees
Jesse Emspak, International Business Times, 15 December 2010

7 Year Moratorium Is a Bad Idea
Phil Ciciora, Illinois News Bureau, 14 December 2010

Energy Policy: 5 Worst Governors
William Yeatman,, 14 December 2010

Ethanol Idiocy Will Not Die
Rich Lowry, National Review, 14 December 2010

Deutsche Bank’s “Corporate Irresponsibility,” Part 1
David Henderson, Financial Post, 13 December 2010

Deutsche Bank’s “Corporate Irresponsibility,” Part 2
Terence Corcoran, Financial Post, 13 December 2010

News you Can Use
Offshore Wind = Ultra Expensive Energy

In a Master Resource post on the economics of offshore wind energy, Lisa Linowes notes that Massachusetts regulators recently approved a contract to buy offshore wind energy for 18.7 cents a kilowatt, “a price that’s three times the cost of in-region natural gas and at least double the cost of other renewable options.”

Inside the Beltway
Myron Ebell

Congress Passes and President Signs Tax Bill with Goodies for Renewables

The Senate and House overwhelmingly passed and President Barack Obama signed the bill to extend the Bush tax cuts of 2001 and 2003 for two years.  There were a lot of other provisions in the bill, including one-year extensions of the 45 cents per gallon taxpayer subsidy and 54 cents tariff for ethanol and the section 1603 up-front taxpayer cash grants of 30% for renewable energy projects.  So we will keep throwing money away on dead-end renewables for at least another year.

Rockefeller Plays Games with Two-Year EPA Delay Bill 

Senator Jay Rockefeller (D-WV) suddenly started talking again this week about offering an amendment to delay implementation of Clean Air Act regulation of greenhouse gas emissions for two years.  Then he quickly blamed Republicans for thwarting his efforts by blocking consideration of the Omnibus Appropriations bill.  Having failed to pass any of the twelve appropriations bills for the various federal departments and programs this year, the Omnibus Appropriations bill is the Democratic majority’s last-ditch attempt to lock in colossal spending levels before the Republicans take over the House in January. 

Senate Majority Leader Harry Reid (D-Nev.) promised Rockefeller a vote on his amendment last June during the debate on Senator Lisa Murkowski’s (R-Alaska) Resolution of Disapproval under the Congressional Review Act.  Reid peeled enough Democrats away with that promise to defeat the resolution that would have blocked EPA from regulating greenhouse emissions permanently.  But of course, a promise from Senator Reid is not what is sometimes understood by that term.  Everyone knew at the time that Reid was not promising anything. 

Senator Rockefeller vowed that, “I will be back fighting hard for my two-year bill as my first order of business in the new Congress.”  That may be true, but events have passed beyond the Senator from West Virginia.  House Republicans will be looking to move a permanent suspension of EPA greenhouse gas regulations.

Across the States


By a 9 to 1 vote, the California Air Resources Board this week approved a state-wide cap-and-trade scheme. The adopted regulation is more than 3,000 pages long, but most of the details have yet to be worked out as the CARB rushed to meet a December 31 deadline set by the 2006 Global Warming Solutions Act, legislation that authorizes the CARB to reduce the State’s greenhouse gases to 1990 levels by 2020. In order to protect California businesses from out-of-state competition, the CARB will allocate emissions credits (a.k.a. energy-rationing coupons) for free. The European Union Emissions Trading Scheme is the only precedent for free allocation of carbon credits, and it resulted in windfall profits for politically-connected industries and higher electricity prices for consumers.


In October 2007, Kansas Health and Environmental Secretary Roderick Bremby denied permits for two proposed 700 MW coal-fired power plants in western Kansas. In 2008 and 2009, the State Legislature passed four bills to allow Sunflower to build the plants, but then-Governor Kathleen Sebelius (currently the Secretary of the U.S. Department of Health and Human Services) vetoed them all. After she left office to join the Obama administration, her successor Mark Parkinson immediately brokered a deal to allow for a scaled-down version of the project. This week, John Mitchell, the state's acting secretary of health and environment, issued an air-quality permit for an 895 megawatt plant. The permit was issued only weeks before the start of new EPA regulations for greenhouse gases. Environmentalists have promised to litigate.

Around the World

Cancun Wrap-up

Last week’s Cooler Heads Digest was published before the conclusion of the 16th Conference of the Parties to the United Nations Framework Convention on Climate Change in Cancun, Mexico; nonetheless, we predicted that the negotiators ultimately would “produce an agreement to meet again.” We were right. The “Cancun Agreement” achieved a near-consensus (Bolivia was the only country to object) by deferring all decisions to future negotiations. The parties agreed to meet in Durbin, South Africa for COP-17 in December 2011.

The Cooler Heads Digest is the weekly e-mail publication of the Cooler Heads Coalition. For the latest news and commentary, check out the Coalition’s website,