Energy

California's Energy Regulations Hurt the Poor, While 'Green' Subsidies Benefit the Rich

Incentive programs for electric cars and solar panels mostly benefit those who can afford those things, while regulations that drive up the cost of energy hurt those who can't afford much to begin with.

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A prominent new study from UCLA researchers about California's energy policies is fascinating not so much for its Captain Obvious conclusions, but because it points to a growing rift on in the environmental world between those who favor the state's far-reaching "green" policies—and those who want to hector us to use less energy.

"Wealth is a prominent driver of demand for residential energy," the authors wrote. "Worldwide, wealthier groups lead more materially and energetically intensive lives than the less affluent, consuming in excess of what they require to meet their essential needs." That's stunning for its inanity. Is anyone shocked that those with higher incomes live in bigger houses, and spend more to cool them, than those with lower incomes?

"This level of consumption is clearly beyond what you need to provide for your survival, to allow you to be a functioning member of society," the study's lead author, Eric Fournier, told the Los Angeles Times. He and his fellow authors thought long and hard about their descriptions of "excessive" and even "profligate" energy consumption. Apparently, academics should decide how much electricity everyone else should use.

I've found a constant theme from the environmental community when it comes to every resource-related policy debate, from electricity production to fossil fuels to water availability. Activists talk about improving efficiencies and battling climate change, but they mainly seem offended that people aren't conserving enough. I'm going out on a limb here, but it's an undeniably good thing that we can use more energy than we need for our basic survival.

Nevertheless, the study has raised an interesting—albeit stunningly obvious—point, as California continues its headlong rush toward a green-energy future based on command-and-control edicts, subsidies and quasi-market mechanisms such as cap and trade. It found that incentive programs for electric cars and solar panels and some other costly energy policies, "have been found to disproportionately benefit wealthier individuals."

Well, poor people generally aren't installing solar panels or buying $50,000 cars. One need not peruse the study's charts of Los Angeles County to know that Electric Vehicle adoption is higher in Beverly Hills than Watts. I'm all for the development of alternative energy industries, but using public funds, and hobbling old-line energy industries with excess regulations and taxes, is a wealth transfer from poor to rich. As usual, the state's progressive policies have unintended consequences.

If the state's alternative energy policies are successful, they are "likely to greatly increase future electricity demand," the study laments. So far, those policies mainly are boosting prices, but if they do eventually reduce them, people will indeed use more energy. That's how supply and demand works. Cheaper energy allows everyone, rich and poor, to live more-enjoyable lives. It lowers the costs for businesses, which can then provide jobs and opportunities.

That brings us back to that above-mentioned tension. Are environmentalists mainly interested in cleaning up the environment or changing the way we live? It often seems to be the latter. As Fournier added, "At some point, you have to get to a place where you're using less energy." Why is that so? If energy becomes more abundant and more environmentally friendly, who cares if I use more of it to keep the hot tub toasty? It's no one's business but my own if I leave the lights on all day—as long as I pay my utility bill.

California is the world's fifth-largest economy. It's a land of unfathomable wealth, yet it also has the nation's highest poverty rate. That rate is above 20 percent, according to the Census Bureau's cost-of-living-adjusted model, even though California has the most-generous anti-poverty programs, also. One reason for those dismal numbers is our state's environmental policies, which increase that cost of living.

California has adopted slow-growth policies that limit housing construction by driving up the cost of developable land. The state imposes regulatory costs that, in some localities, comprise 40 percent of the cost of a new home. The result are median-home prices that are unattainable for low-income and even middle-class people. We all like open space, but every policy choice comes at a price, often a high one.

Similarly, our energy prices are among the highest in the nation. Thanks to California-specific formulations, our gasoline costs more than other states, except for remote Hawaii. Our water and electricity policies boost the costs of those necessary products—and the state adds to our sky-high tax burdens by doling out subsidies. California imposes alternative-energy requirements that force it to import 29 percent of our electricity, raising prices on those who can least afford it.

Then researchers are shocked to discover that California's energy policies impose disproportionate costs on poor folks. The solution is to promote energy abundance, freer markets and less regulation—rather than to create even more programs or to hector suburbanites who "overconsume" air conditioning to cool their homes.

This column was first published in the Orange County Register.

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  1. CA is heading for a major financial crisis. No bailouts for fiscal irresponsibility.

    1. No bailouts for fiscal irresponsibility.

      Remember that when you vote in November.

      1. Remember that when your vote is cancelled out by a voter who “deserves” the bailout.

        1. Some day, in a democracy designed for political sustainability, only people who pay net taxes will vote.

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        2. Just WHO deserves a bailout?

    2. Nope, we are doing better than most states and many nations.

      What you folk want to ignore is the development of technology allowed by early subsidies. My entire house hold and two electric cars are powered by the PV system on our roof. It paid back in three years in gasoline replacement alone,and now has given us free power for transportation and the household.

      1. Good for you! Now fund your own dead ends and fantasies…

      2. And while you drive on the highways with your electric car you are paying almost nothing for road maintenance and buildind new roads while those who drive the old gas driven cars pay a bundle. Incidentally the subsidies your got to pay for your PV system the POOR could not get for a couple of reasons. 1) not a home owner 2) could not afford the cost of the instilling the P V system even it they were a home owner. So all these these good ideas like most every thing else benefits the rich but not the poor.

  2. “Worldwide, wealthier groups lead more materially and energetically intensive lives than the less affluent, consuming in excess of what they require to meet their essential needs.” That’s stunning for its inanity. Is anyone shocked that those with higher incomes live in bigger houses, and spend more to cool them, than those with lower incomes?

    Uh, huh. But what about the “require to meet their essential needs” part?

    1. What about it? Pretty much everyone in the US lives well above their essential needs

      1. That’s why the world wants to emigrate here…

  3. Government is a parasite. We know.

  4. Wealth lies behind every advance in human life. The wealthier are healthier, happier, live longer. This is true for people and societies. It is true now and had always been true in the past, as any reading of history shows. No one other than Ralph Waldo Emerson and a few monks have ever felt better off by living in unhealthier filthier poorer conditions, although a lot of hippies pretended so.

    It continually amazes me how few statists understand this, and how their reaction to just about everything is policies intentionally designed to make people poorer, both as individuals and societies. Of course, it is always for others, never for them.

    1. The don’t understand the value of wealth because they have never been without it. Leftists are almost always from the upper middle and upper classes. There has never been an actual popular leftist revolution. They are always revolutions of a violent vanguard who are willing to like, cheat, and kill their way to power when the circumstances allow it.

      To be a leftist is to be someone who lacks the imagination necessary to understand the value and fragility of wealth. Leftists think wealth just magically occurs such that the problem in life is not how to create it but instead how to fairly distribute it among the population. Only someone from a very stable and privileged background could fail to understand that the real problem for society is how to create wealth.

      The left has always been a combination of intellectuals who lack the imagination to understand that wealth has to be created and just ordinary criminals who see leftist politics as a means of committing theft and murder on a massive scale. Think Lenin and Stalin and you have the archetypes that cover actual leftists, though they all are criminals and thieves to some degree.

      1. Nuh-uh. They are always people’s revolutions, people’s democratic republics. You can’t fool me. The people’s history by the people’s Zinn tells me the people’s truth.

    2. We have to face it. The human brain is programmed for negativity and egotism. It will always imagine that the individual and societal situation is the worst ever (and always the fault of someone else). And it will embrace every doomsday scenario provided by other corrupt maniacs. It is much easier to wallow in pity, both self and that provided by the hysteria media-political-industrial complex, than to take charge of one’s own life.

      Any attempt to demonstrate how (1) humanity is better off now in every way than it ever was, (2) that improvements will continue (unless deliberately thwarted by collectivist luddites), and (3) every individual needs to make some amount of effort to enjoy a prosperous life will run into powerful narratives of despair and gloom–and the need to fully submit to a new savior. And suffer for our sins.

    3. “Wealth lies behind every advance in human life.”

      Actually military improvements drive advances in human life. Da ‘net, the need for improvement in semiconductors, electronic communications (radar, etc.), and so on. Electric vehicles will only come about when the military figures out how to do it. (Just think about the fuel logistics involved in day-to-day military operations away from bases.)

      1. “Actually military improvements drive advances in human life.”

        Bullshit.

      2. Electric vehicles will only come about when the military figures out how to do it.

        You understand that electric vehicles already exist, right?

        1. Ours are a 2013 Tesla Model S P85, and a 2015 VW e-Golf.

      3. Military improvements lie behind more destruction of human life and societal capital resources than anything else…

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  5. They are offended that so many people in America live above subsistence level. They hate that our poor are relatively rich compared to the rest of the world.

  6. “California’s Energy Regulations Hurt the Poor, While ‘Green’ Subsidies Benefit the Rich”

    Tom Steyer, noted lobbyist for ‘green’ causes, also made his millions off of gov’t-subsidized ‘green’ scams.

  7. “If energy becomes more abundant and more environmentally friendly, who cares if I use more of it”

    Only every Green-nanny-Karen-puritan-communist-moralist ever.

  8. Electric Vehicle adoption is higher in Beverly Hills than Watts.

    How ironic.

  9. Are environmentalists mainly interested in cleaning up the environment or changing the way we live?

    Neither. They’re interested in virtue signaling and being part of the right group. And if “those people” can’t afford to pay their electric bill, that’s their problem.

    1. Ignorance. We produce all our electrical power for the entire household and both electric vehicles, a 2013 Tesla Model S, 85 and a 2015 VW e-Golf.
      No pollution, no noise, no intrusion.

      1. So you don’t live where solar can’t do that. Got it…

      2. I was going to congratulate you on owning coal-powered cars, but apparently you’ve got that handled – if you can keep that power system and those cars running long enough to make up for all the coal and oil used to produce them.

        Check your privilege. If you are charging your cars at home with solar power,
        1) You live in a very sunny place.
        2) You work at home (if at all), or else your cars wouldn’t be there in the day to charge. Most of us can’t do that.
        3) You are rich enough to pay a large premium for your cars and put up a very expensive solar system – even after the tens of thousands your government cronies have extracted in taxes from those not as rich as you in subsidies for the solar panels and electric cars.
        4) You are also going to eventually pay more in maintenance for those systems than I pay for my diesel car, maintenance, and fuel. Have you ever priced replacement batteries for your cars?

        And if you are charging your cars at home at night with renewable energy, how many birds did your wind turbine kill, or how many fish did your dam kill? (And how many Chinese humans were poisoned by pollution from the rare earth mines needed to build the generators?) You also must be quite rich. And maybe you haven’t learned this yet, but there are also high maintenance costs for those technologies – dams break and kill people downstream if you don’t keep them up, and I’ve seen a lot of wind turbines put up to collect government subsidies, and then shut down in a few years when the repairs needed would cost more than the electricity produced was worth.

        I hope you aren’t planning a road trip, ever. IF they put up a few more charging stations in the heartland, you might be able to duplicate the trip which my grandparents took in the 1920’s from Iowa to CA (and back when CA turned out no more hospitable than where they started) in only a few more hours – in spite of having interstate highways instead of a sketchy network of state and local roads, and of your car being much more reliable in every way other than depending on an outside electric power source.

  10. California is the third most expensive state to live in. And that’s become a status symbol as every policy is geared towards making it more expensive. Small businesses leaving the state is not a signal of failure, but the whole point. The number one religion is the Church of Higher Property Values. So long as there are enough quaint bodegas and people of color to serve as gardeners and maids, affluent white liberal Californians don’t give a shit how rough it is for the lesser classes.

    1. I’m beginning to think that was one of the goals of the coronavirus shutdown. Big businesses can have people work from home, and can take a financial hit for a few months, and can be bullied on Twitter into taking politically correct positions on the issues. Small businesses will go broke from extended shutdowns, but they are mostly owned by Republicans.

    2. My 1956 house was originally sold for $12k. It is now “worth” a million dollars more than that. Why? All the goobers who moved here to get part of what we built – California.

      We should send back most of those born in other states who just wanted to be cool like us.

      1. Just secede. We’ll all wave bub bye to the Democratic People’s Republic of CA…

  11. The worst part is the HOV lane free pass for Tesla drivers. They can show they care about the environment (enough to have a new car built and delivered for them, rare Earth minerals excavated for the battery, and electricity generated in coal burning power plants then transmitted over lossy power lines causing forest fires), and zip by the less woke in the “carpool” lane that causes more traffic jams and pollution for the less woke.

    1. Even more ironic, you probably helped pay for their car with tax breaks and subsidies. They’re passing you in the HOV lane, and you helped pay them to do it. That would piss me off too…

      1. I have yet to be thanked by a Tesla owner for my contribution to his virtue-signalling.

    2. Yeah – I remember when the purpose of those lanes was to relieve traffic congestion by encouraging people to carpool, rather than to reward people for purchasing the correct product.

    3. Nope, My Tesla is powered by the PV panels on our roof. We have no coal-powered electricity here. And EV s have not been able to use the HOV lanes now for years. Are you Russian?

      1. Sure. How much do you drive that car? About 20 miles a week?

  12. “California’s Energy Regulations Hurt the Poor, While ‘Green’ Subsidies Benefit the Rich.”

    Well, wasn’t that point in the first place, driving out the middle class so the rich can bask in the golden sunshine of California exclusively?
    After all, if you’re not a millionaire, then you don’t deserve to live in the socialist utopia of California anyway.

  13. California is literally a 3rd world state, the rich who are so wealthy they don’t care what the tax rate is on top, the poor that are given a subsistence living from the state, the governing class that live off the taxes and fines and the shrinking middle class that pay most of the taxes and fines.

    I keep reading how California has the 5th largest economy, I just don’t see it. If you count that by the amount of money the companies that are headquartered there make maybe but how much of their earnings are in the state and therefore qualified for taxation. Hewlett-Packard for instance has its headquarters in California but doesn’t produce anything there, they make their servers in Texas at the old Compaq plant, the printers in Idaho and the workstations in Mexico. Apple phones are made in Asia for the most part and does AMD or Intel even have plants there anymore. What you have are the uber rich execs there, and they all have tax lawyers to figure out how to hide the money from the tax man and the actual workers that pay most of the taxes are elsewhere. Even the movie industry has moved on. And if they really started going after these guys how fast could they move out of state completely? Tesla has a plant there but how many cars a year do they make and I am sure Elon got a sweet deal to build it there, and even with that his patience is wearing thin.

    1. I love it when folk in also-ran states give us advice.

      1. Not on how to create poverty, you lead the US…

        1. Don’t feed the troll, I have seen this ID on multiple sites, it claims among others to be an engineer, a medical professional etc. Just ignore it and the ChiComs that own it will move on.

  14. Nannies gotta nannie, don’t they?

    And California has a crazy overabundance of them.

    I bought the house I live in thirty years ago. My electric bill back then was between $22 and $24 per month winter and summer. I heat with wood, which I find, scrounge, salvage, haul for free, harvest from the land here and close by. No aiur conditioning.. if I had it I would not use it, Have had it in the last three cars, never used it in any of them. Don’t need/want it.

    Today, same house, my electriv bill runs $63 to $66 per month year round. Thinking I was somehow using more energy, I dug out some old $23 bills and checked. Nope. I am using almost exactly the same number of KwHrs now as I did then, and the graph comes each month for the past year, almost no change through the seasons. SO.. I can safely say the price per KwHr has TRIPLED over the past thirty years. WHY? In that time my crazy state government have mandated all manner of stupid things.. shutting down the remaining clean coal fired generator plants, mandating the building of insane solar arrays, and wind farms. I’ve seen some of those up close and personal.. half the towers on one two-section wheat farm I used to go to are mothballed, yet still standing. Large quantites of greenbacks were wasted making, transporting, assembling, brigning onl line, then shutting down and mothballing. And I believe ther are dollars in a eseve fund earmarked for the dismanting them soon. The eedjits runnig the state also mothballed a few nearly completed nuclear generating plants…. after spending begabux bringing them to near completion. The mothballling of those costs another cool $mn/year, added to our energy costs. Meanwhile theyve destroyed a few hydroelectric generators, because the Green Weeenies were on such a whinge. Again, part of the $40 eaxrtra per month I’ve been paying the last fifteen years or so.

    Think I like “green” energy? On and I have not even MENTIONED the added costs for motor fuel to comply with the “green” rules that don’t make a lick of difference. Not only does the fuel cost more per gallon, but it delivers less total energy per gallon, thus to get as far at the same road speed I have to burn MORE.

    Take your Green Giant and go drown him ih the Marianas Trench. Tomorrow.

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