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    Leaving Michigan families out in the cold


    By Nick, Section News
    Posted on Fri Sep 19, 2008 at 06:45:55 AM EST
    Tags: (all tags)

    Still smarting over last year's $1.5 billion Democratic tax increase?  Are you one of the 20,000 people who lost her home last month or the other 16,000 who lost it so long ago you finally stopped looking for a new one?

    Do you know anyone who is having a hard time paying her bills?  Know anyone who has to choose between his prescriptions and groceries?  Anyone who can't afford to keep the lights on and food on the table?

    After yesterday's action in the Michigan legislature and Jennifer Granholm's eager cheerleading we're all about to know a lot more people in a lot worse shape.  Start chopping wood and getting that fireplace ready.  Before they tax that too.

    Just in time for another one of our legendary winters, the Democrats in the House of Representatives (and, sadly, a few Republican bums in the Senate) took a series of votes yesterday to dramatically raise the electricity rates on Michigan moms and dads while killing competition and guaranteeing an energy monopoly with zero oversight.

    The Ivory Tower reports:

    A package of three bills dramatically changes the way Michigan utilities are regulated, giving the state's two largest power generators -- DTE Energy and Consumers Energy -- near monopolies in the markets they serve and allowing them to raise rates with no oversight until after the fact.

    The utilities are guaranteed at least 90% of the state's electric market under the changes.

    But wait, there's more.  The package also shifts some fees away from businesses and directly onto residential consumers and imposes new tax hikes to fund "renewable" energy.

    Estimates vary but the average Michigan homeowner is expected to pay over $150 more a year to keep the lights on and the furnace running.  Testimony before the House indicated that 22% of the state's residents are already behind on their energy bills.  That number is about to grow and a lot of folks are literally going to be left out in the cold.  The Detroit News reports:

    The strict limits on competition "will create the largest residential rate increase in Michigan's history," said Barry Cargill, executive director of the Customer Choice Coalition, a group of businesses that favor competition. He estimates the overall impact of the two bills will be an increase of $475 million a year for utility customers, which amounts to $13 a month for DTE customers and a little less for Consumers ratepayers.

    Sen. Wayne Kuipers, R-Holland, who voted against the bills, said: "This will result in massive rate hikes at a time when we can least afford it." He said in the wake of 8.9 percent unemployment in the state "what do you say to those who " have just lost their jobs and now ask, 'How can I pay for this?'

    Well, Senator, you tell them to join the club.  It is expanding rapidly.  

    We've got the monopoly for Consumers and DTE.  We've got the new Democratic tax hike / surcharge to fund their government mandated "green" guilt projects.  We've got rapidly rising rates on residential customers.  But maybe worse than all of that is the lack of oversight.  The Big Two can now, literally, raise rates whenever they'd like and with the lack of competition we are left holding the bag.  There's no other game in town.  Pay their exorbitant rates or freeze in the dark.

    It is an especially cruel fate for families at or below the poverty line and seniors on a fixed income.  The same folks Democrats tell us time and time again they want to "protect" are going to pay just as large a rate increase as those who are more fortunate.  And while there are some who can cut back on their Christmas shopping or buy fewer back to school clothes for their kids, there are others just plain out of holes in their belt.  They can't tighten it any further.

    For those in Michigan who can least afford it, this is going to be one long, cold winter.

    < After Action Report: McCain/Palin Grand Rapids, MI | Friday in the Sphere, September 19 >


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    Not so fast on "deskewing" residential (none / 0) (#1)
    by Hayekian on Fri Sep 19, 2008 at 09:30:07 AM EST
    "But wait, there's more.  The package also shifts some fees away from businesses and directly onto residential consumers . . ."

    Actually, that part is the one surprising positive in a very dismal, destructive package. Businesses have been subsidizing residential customers all along, and Michigan just can't afford that anymore.

    The most dismal part is the completion of the repeal of electricity competition begun by the PSC in 2004. That shows the absolute moral bankruptcy in Lansing - those SOBs just sold Michigan's energy future to DTE for 40 pieces of silver deposited in their caucus campaign warchests.

    There are two silver linings to the "renewable" mandates. First, they're phony. I haven't dug in yet for the details, but the bill contains a circuit breaker to allow the mandate to be suspended any time it costs too much, which means an amount that will piss off middle-class rate-payers and voters. Which of course will be triggered every year, since the mandate is impossible.

    The other silver lining is that every other state is adopting the same form of dishonest nonsense, so Michigan won't be hurt as much as if we were the only one. If we hadn't adopted this it would give us a comparative advantage in one area, and this legislature appears determined to wipe out every last one of those. Exhibit 1: The water regulation package.

    Can you hear my know. (none / 0) (#2)
    by LookingforReagan on Fri Sep 19, 2008 at 11:33:47 AM EST
    More robbery sponsored by the left. More hardship imposed by the left. They think that if they continue to do this we will be more inclined to vote for them. Of course the MSM and the Governor will blame Bush and the pablum licking morons on on the east side of the state will accept it as gospel. At this rate with jobs and residents disappearing as fast as a roasted hog in front of Rosie and Rosanne this state will become a Social Service based economy in less then five years. When in hell is enough, enough?
    It is time to get the petitions printed and the voluteers enlisted. Granholm has to go. NOW not later NOW. John Cherry has to go. We need to recall every member of the legislature that voted for this garbage. Not only run out of office but out of the state as well. Remove them and send them into exile.

    Make them famous. (none / 0) (#3)
    by LookingforReagan on Fri Sep 19, 2008 at 11:55:41 AM EST
    Okay, so we need to know. Who are the gutless RINO's that voted for this garbage? PLease list their names. Also please include whether or not they voted for the Granholm/Dillion/Cherry tax increase.

    The list of RINO sellouts (none / 0) (#5)
    by LookingforReagan on Fri Sep 19, 2008 at 05:46:33 PM EST
    Taken from the Michigan Senate website. These names of Republican Senators are listed in the Journal of the Senate as voting yes on Granholm's criminal energy bill.
    Allen-Traverse City
    McManus- Lake Leelanau
    Stamas- Midland
    Gilbert- Algonac
    Birkholz-Saugatuck
    Richardville- Monroe
    VanWoerkon-Muskegon
    Bishop- Rochester
    Hardiman-Kentwood.
    Here they are. Let their names be known and remembered in 2010 when they come hat in hand asking for support and money to return to the Senate. These people didn't care about supporting the people of Michigan so it is only fair that we not care about supporting them in the next election cycle.

    Energy plan (none / 0) (#6)
    by WadeHM on Fri Sep 19, 2008 at 08:46:04 PM EST
    I am in my mid-forties and I have more income now than at any point in my life, yet I have a harder time living off that money than at any other time in my life. Now it is going to get worse. I guess I'll have to do the Jimmy Carter energy savings plan, dress warmer and keep the heat turned down.

    Reasons for energy cost increases (none / 0) (#7)
    by mcdirt on Fri Sep 19, 2008 at 11:01:50 PM EST

    A few observations:

    1. Had this package not passed, our utility bills would have increased substantially anyway. Energy legislation characterized as "raising your bills" often implies the alternative is not paying higher bills. This is a false choice. Coal costs are skyrocketing. Capital costs for plant construction...ditto.

    2. The cost of wind power is now very near, and in some projections lower cost than comparable generation of nuclear, new coal, and all other conventional generation. Even if that turns out NOT to be the case, this package has a safety valve that gives utilities an off-ramp should the cost of renewables be more than 5 percent more expensive than new generation.

    3. The fact that the "renewable" charge you'll soon see on your utility bill is a sad concession to the utility companies who like to deflect the blame for the higher costs on the "greens." The mix of renewables will actually lower bills in the long term, and be a valuable hedge against rising conventional fuel prices. When was the last time I saw a special line item on my DTE bill for capital costs of the coal plants? Why should I see a special line item for wind turbines?

    4. The energy efficiency program is the ONLY portion of this package that will reduce energy bills. Surely. Demonstrably. Unquestionably. Even Mike Bishop said so. It is a travesty that Michigan has not done this for more than a decade. THIS PROGRAM WILL SAVE YOU MONEY.

    I make these points to emphasize that the very modest renewable energy standard and the energy efficiency programming are the portions of this package that will help keep a lid on rising utility bills in the short- and the long run. The "deskewing" and skyrocketing cost of coal are the primary culprits for the rise in residential rates that you'll soon see.

    Nick labels efficiency and renewables "green guilt" projects -- an unfortunate and wholly inaccurate moniker that neither recognizes their huge economic value nor their job creation potential.

    The 1970s were fascinating. And fun. But this is 2008 and discerning observers should be able to stop parroting tired old cliches and recognize what has changed: Renewable energy is mainstream for economic reasons. Preventing power plant pollution has as much to do with public health and economic costs as with saving the planet. And the environmental movement has as many Phd's as hippies.

    Hugh

    More then enough proof (none / 0) (#8)
    by LookingforReagan on Sat Sep 20, 2008 at 11:04:27 AM EST
    That renewables are a joke. They don't work and many have a bigger Environmental footprint (God I hate that term) then what we are doing now. Example. We already know that the numbers put out by the whackos on the left are never questioned by the MSM. But an enterprising young man recentley ran some numbers for the proposed wind engery plan for California. I can't sight chapter and verse the figures he used but the end result was that California in order to replace fossil fuels with wind generation would have to buld a wind farm that covered 9000 square miles in order to generate as much usable energy as the current electric plants whether they be coal, nuclear or natural gas. How is that for environmental destruction?
    Ethenol is another farce. With corn at $8 a bushel and liabel to go higher where is the savings? There are none. Eight dollars a bushel for the corn, two dollars in production costs, transportation and then a little in for profit and your costs are about $11 a gallon. Makes $4.50 a gallon gas seem pretty cheap. But it also illustrates the unintened consequences that always seem to crop up with any of these "Save the planet" ideas that the left always come up with. They don't work or there is some sort of major flaw. I guess when you seek to skew the computer models with fautly data the results don't pan out in the real world. Let's look at electric cars. Just making the batteries for these stupid things is more environmentally unsound then making and running a vehicle with an enternal combustion engine. Most of this information is hidden or suppressed by the Liberal Socialists and the MSM. The biggest reason is that the public won't get on board because of the cost and the fact that this stuff in practice doesn't work. So they have to get the Government to "make" us do it. Whether by activist judges legislating from the bench or by other forms of coercion.
    The very name "Renewables" is in itself a lie. Once energy is used it is gone. It can not be renewed. The proper term would be replaceable. As in trees can be replaced by growing other trees so that I can cut them down and heat my home. How you like them apples ALGORE? You big dummy.

    How do we explain? (none / 0) (#11)
    by mcdirt on Sun Sep 21, 2008 at 03:20:15 PM EST

    How do we explain to the would-be mogul that they will be competing against a near-monopolistic utility that has built up an economy of scale aided by decades of government assistance, tax breaks, etc. etc.?

    But, sorry, "Fledgling Wind Energy Inc." you'll get no help whatsoever in competing on a level playing field with them.

    Energy efficiency is a case in point. EE will save everyone money, reduce the need for expensive new electricity generation and protect public health and the environment. But the utilities aren't going to do it themselves...their interest is selling more product. I think that's where its reasonable to require these near-monopolies to act in the public interest,

    McDirt (none / 0) (#12)
    by Ed Burley on Sun Sep 21, 2008 at 11:30:25 PM EST
    First of all, you are right about the "near-monopoly." Public utilities are virtual government-created monopolies. That's the real problem. Monopolies don't compete, so they can charge whatever they so choose. A true energy policy would be to break up the monopolies just like they did with AT&T back in the day. Look where communication has gone - and no one could have foreseen it way back then. Truly amazing, but only through the free market of ideas.

    Now, since I am unable, for some reason, to post a response to your last two posts, I must comment on both of them in this one Comment. With that said, you made the claim that NO ONE is saying that wind will replace fossil fuel en toto. Au contraire, mon ami.

    Obama has an ad which states that he can, 10 years, replace fossil fuel with wind. Will you join me in saying that he is a liar?

    In your response to Mr. Gillman, you talk about energy efficiency. Sorry to say, dear friend, that energy efficiency does NOT lessen our consumption of energy - quite the contrary. Energy efficiency causes prices to drop (that old productivity thing again), and entices people to use more of it. Thus, we need more of it.

    Let's look at a couple of examples. Cars of 30-40 years ago got between 7-20 miles to the gallon, depending on the make and model. Today's mid-size V-6s get easily 30 mpg (just went to Texas over Labor Day with my cousin in his 2003 Ford Taurus, and we got 31 mpg overall). Has this decreased the demand on fuel? Hardly, the average driver in America consumes more gasoline today than 30-40 years ago (when we were told that we had less than 40 years of oil left in the world).

    Let's consider electricity as our other example. All new appliances boast of being energy efficient. Has that lessened our demand for electricity? Again, not so much. Instead we fill our houses with new appliances. Whereas our parents had 1 TV, most Americans have 2 or more. We have DVD players and VCRs that our parents didn't know about. Central air is a relatively new invention. There's a whole host of other things we have in our homes now that consumes energy - even though we have become more energy efficient.

    Reader's Digest published a book years ago that I think is called "Back to Basics." (I could be wrong about the title). In it, they explain how to build your own windmill, and solar panels. What I encourage you, McDirt, to do is to do that. Go off the grid. Get yourself a couple windmills, cover your rooftop with solar panels, and replace what appliances you can with non-electric ones (the Mennonites have a catalogue full of all kinds of stuff like that). See how well you do.

    If you do well, let us know. I'll join you. If you don't, stop trying to take away my right to having a clean reliable source of energy.


    McDirt 2 (none / 0) (#14)
    by Ed Burley on Mon Sep 22, 2008 at 07:40:58 PM EST
    Was your message cut off for some reason? It seemed to end abruptly.

    A couple things: since you seem like a man who will at least consider a variety of positions on the subject, please read "The Bottomless Well," by Huber and Mills. They are NOT anti-alternatives, but argue instead that the technology is outpacing all these government mandates. Please take a shot at the book.

    In regards to my comments on wind and solar, I was not trying to be frisky, I was serious. I have known of a couple of guys who had two different experiences with wind in the past. One, a friend from Anaheim CA, had 3 windmills and had to supplement. Another, here in Michigan, was an acquaintance of a friend of mine, and he had one windmill and seems to have had more than enough power. Also, Karl Hess, the noted libertarian (backed Goldwater) and neo-leftist (would probably back Obama today), used wind and solar to help his communities that he founded; one in downtown Washington DC and the other in rural West Virginia. You can read about these experiences in his book "Community Technology."

    You see, I don't believe that the answers are to be found with large government-mandated monopolies, but in small investors and entrepreneurs who will find workable solutions to these problems. I personally like the Waste-to-Energy (burning trash for electric generation) that is being used successfully in a number of cities. With oversight, they have minimized (very much so) the pollution potential, and generate around 15% of each city's needs. Better than throwing it in a landfill or in the ocean, right?

    Thanks for your comments, I appreciate your civil tone, and your well thought out arguments.

    Ditto (none / 0) (#15)
    by mcdirt on Mon Sep 22, 2008 at 09:16:07 PM EST

    On the robust debate.

    I'll see about a wind turbine for our house. But first I'll probably need a big govt loan from Barack to make it happen :)

    H

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