What is the debate about?

Writing in today's Herald, state Rep. Floyd Nease says

Rep. Komline [she wrote an earlier piece  ($) in the Herald] writes that "global warming is a global issue, and it is noble that Vermonters want to do their part to help mitigate its effects." Actually, climate change is a Vermont issue, and most Vermonters who want to do something about it are motivated not by noblesse oblige, but by the bottom line

What is a local issue and what is a global issue? 

If Vermonters spend $10 million a year to reduce phosphorus going into Lake Champlain, the lake will be measurably cleaner.  If Vermonters spend $10 million a year to reduce carbon emissions, there will be no measurable change in the carbon content of the atmosphere.  That suggests to me that climate change is a global, not a local problem.

And, if Rep. Nease is going to use business terminology, like the "bottom line," he ought to consider that what ends up on the bottom line is a subtraction of costs from revenues, or more globally, costs from benefits.  That means we need to measure, or at least attempt to quantify, the benefits and costs of any action we take.  Since the costs of climate change, as well as the benefits, are measured over decades, if not centuries, it's hard to do that in 200 words, much less on a bumper sticker.

Rep. Nease goes on:

It also represents an opportunity to save money, create jobs, and grow an economy focused on renewable energy.

I've written on the saving money issue before here.   And if  saving the planet is going to create jobs in Vermont, the question is where are the people who are getting those jobs going to come from?  Currently unemployed Vermonters?  Unlikely.  Most have few marketable skills.  From people currently working? Then there will be job losses elsewhere and no net new job creation.  Rep. Nease could benefit from reading Frederic Bastiat's analysis of this from 150 years ago, or just my summary here. 

Rep. Nease wonders out lout (or at least in print) about the Governor's veto of the global warming bill, writing

Despite making past statements that praise Efficiency Vermont's role in saving Vermonters money on their electricity bills, they argued, as Rep. Komline does, that "Vermonters are savvy enough to figure out how to weatherize their homes" without the assistance of Efficiency Vermont.

If that was the case, why have so many Vermont residents and businesses such as IBM taken advantage of the services offered by Efficiency Vermont?

Here's one possible answer to that question.  Suppose I am planning to save energy and money by buying more energy efficient appliances, or buying a new more energy efficient machine for my factory.  It's going to cost me $25,000 but to me it's worth it because it will save me $5,000 a year in energy costs (I'm making up these numbers).  That's a 20% return on my investment, and the bottom line looks very good. 

I find out about Efficiency Vermont and invite them in to take a look at my house or factory and tell them what I'm thinking about.  They tell me they have a program that will pay for half the $25,000 cost.  The bottom line looks even better.  I give it about 2 seconds thought and agree to take advantage of their largesse and do what I was going to do anyway.  I save money and Efficiency Vermont claims they have helped save me $5,000 a year for only $12,500 investment on their part.  A great return on their investment.

Or as Rep. Nease puts it

In fact, savvy businesses across the state have enlisted Efficiency Vermont to advise them on ways to make their businesses more electrically efficient.

So have thrifty homeowners, who use Efficiency Vermont to find out where they are losing electricity as well as what actions to take to make their homes more efficient.  In the process, those homeowners and businesses have documented hundreds of thousands of dollars in savings.

Which is exactly what I just said.  We just used different words.

Comments

[Michael Quaid]

The actual practices of Efficiency Vermont are even more ridiculous than Art Woolf imagines. In two cases in which I was personally involved, I surveyed wastewater treatment plants that had already been constructed, checking off various boxes on the Efficiency Vermont-provided form for high-efficiency motors, LED exit lights, etc. Efficiency Vermont tabulated the results and sent a check to the municipalities - a new definition of the word incentive. But they got to claim more killowatts saved on their annual report!

[Judy Livingston]

The President of IBM stated in our committee (House Commerce)that of the $1 million they spent with Efficiency Vermont, $700,000 went to actual plant improvements and $300,000 went to EV - wondering (unhappily) why they didn't put that $300,000 into more improvements - something they know a bit about - all being engineers.
I have been watching my electric bill which pay toward EV @$5-7 per month makes me wonder, too.
Also overheard around the Statehouse - that EV comes into a new house, already constructed with the latest energy-saving materials required by Vermont law, and claims the projected future possible energy credits to their account.
Audit anyone?