Climate Bill Needed to Help Economy Recover

Administration officials have warned that uncertainty over the future regulation of emitting greenhouse gases is preventing companies from spending capital on new power and manufacturing projects.

Only once those costs are laid out will investors feel comfortable pouring that money into green technologies and less CO2-intensive facilities, they say.

Dow Jones reported that at an Export-Import Bank conference in March, Energy Secretary Steven Chu said that this delay meant jobs were not being created. Joseph Aldy, special assistant to the president for energy and environment, said that the White House economic team is concerned about “the chilling effect on investment of not having legislation.”

EPA’s move to regulate large CO2 emitters--and attendant controversies--add even more policy uncertainty to the mix. The fact that the rules will likely face numerous court challenges will tend to discourage companies from adapting to them until the dust has settled. Industry players say this may result in delays to modifications to existing facilities and accelerate closures of CO2-heavy ones.

This year the Energy Information Administration factored into its forecasts a rise in the cost of capital for coal-fired plants based not on existing law but on “implicit” policy hurdles.

Return to April 2010 Western Energy News

To sponsor Western Energy News, please contact WEI at 503 231-1994.