Are Marylanders actually paying too little for electricity?
Are electricity rates in Maryland too low to promote conservation among consumers? That's what a local economist suggests. In an interview published in Maryland Commons, an online journal of news and commentary, Professor Tim Brennan at University of Maryland, Baltimore County argues that letting electricity rates rise is the best way to get consumers to conserve.
Brennan also says he favors putting a price on climate-warming greenhouse gas emissions, either through some kind of tax or cap-and-trade scheme.
"One of those may be better than the other for environmental or political reasons, but either goes a long way toward preventing all of us from regarding the atmosphere as a free dump for the exhaust from our burning," he said.
Brennan also questions the recent efforts by legislators and Gov. Martin O'Malley to re-regulate power generation, suggesting that the current political pressures to hold down prices while also trying to reduce consumption may be discouraging power plant construction.
What do you think? How many are cutting back because it's the right thing to do, and how many to save money? Have you done anything to conserve energy in your life? Increase insulation in your home, turn down the thermostat or drive less? Were you conserving more when prices were higher recently?
To read more of Carrie Madren's Q&A with Brennan, go here.
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I report on the environment and Chesapeake Bay. A native of West Virginia, I have focused mainly on Maryland's environment since moving here in 1983. Along the way, I've crewed aboard a skipjack in the bay, canoed under city streets up the Jones Fall from the Inner Harbor, and gone deep underground in a western Maryland coal mine. Recently, I have been covering the growth and development transforming the landscape. I love seafood, rambles in the country and good stories. I hope to share some here.
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Renewable energy providers understand that price drives behavior and consumers should be paying the real price of energy. That's why you heard them opposing the re-regulation bill in Annapolis - it would have eliminated choice, another critical component in the growth of renewables as an alternative to fossil fuel-based electricity generation. For the record, I've worked for the utility for 32 years. Electric restructuring was the right move but got unnecessarily politicized by the imposition of price caps. Not to mention the basic economic law that you can't sell something for less than it's cost for very long. The politicians like to point out that choice never developed as intended but always fail to point out that competition could not develop as long as mandated prices were artificially low. You are now beginning to see choice take root. See Jay Hancock's blog for a consumer perspective. If you're a BGE customer and want to reduce consumption and greenhouse gas emmissions and, yes save money in the process, take advantage of its demand side management program, Peak Rewards.
Posted by: Big Mike | May 8, 2009 2:57 PM