Master of His Own Domain: President Declares Government Will Slash Emissions over Next Decade; Isn’t Quite As Clear Who Will Pay For it

Washington, DC – Earlier this morning, President Obama promised that over the next 10 years, the federal government will reduce its carbon emissions by 28 percent – and issued an executive order to make it so. “Actions taken under this Executive Order,” the White House declared today, “will spur clean energy investments that create new private-sector jobs, drive long-term savings, build local market capacity, and foster innovation and entrepreneurship in clean energy industries …”

Following the announcement’s release, the Institute for Energy Research (IER) conducted its own fact-check of key assertions contained in the statement. What follows is what we found:

WH Presser: “Achieving the Federal GHG pollution reduction target will reduce Federal energy use by the equivalent of 646 trillion BTUs, equal to 205 million barrels of oil, and taking 17 million cars off the road for one year.  This is also equivalent to a cumulative total of $8 to $11 billion in avoided energy costs through 2020.”

IER: While it’s not entirely clear from where the 646 trillion BTU number was derived (no citation given), the notion that this initiative will result in the “cumulative total of $8 to $11 billion in avoided energy costs through 2020” is difficult to substantiate. What will this initiative cost? Will expected costs exceed “avoided” costs? To argue that this is a cost savings measure is not only disingenuous, it is misleading.  A proper accounting of costs and benefits would include a recognition that there’s no such thing as a free lunch – especially when dealing with renewable energy resources that are, by their very nature, expensive, unreliable and intermittent.

WH Presser: “As the largest energy consumer in the United States, we have a responsibility to American citizens to reduce our energy use and become more efficient,” said President Obama.  “Our goal is to lower costs, reduce pollution, and shift Federal energy expenses away from oil and towards local, clean energy.”

IER: That the U.S. Government is the largest consumer of energy in America is accurate; beyond that, very little of this statement seems to reflect the reality of the present world. It is indeed easy to cast demagogic aspersions on oil – and then leave the podium to board an aircraft that runs entirely on fuels derived from it. More difficult – but more representative of the actions of a leader – is to admit that any attempt to radically restructure the means by which the federal government secures it energy will necessarily require higher costs, higher taxes, and the potential for significant disruption owing to the use of an unreliable, but politically correct, product. Framed in that context, some Americans may still support the broader program – but at least none would be deluded into thinking it can be secured without cost.

WH Presser: “Federal Departments and Agencies will achieve greenhouse gas pollution reductions by measuring their current energy and fuel use, becoming more energy efficient and shifting to clean energy sources like solar, wind and geothermal.”

IER: At its core, this initiative is nothing more than a renewable electricity mandate and a cash for caulkers program wrapped into one, sweet-sounding cipher. While the President cites “avoided” costs, he fails to mention the untold additional costs such a program like this will cost the taxpayer. According to Energy Information Administration (EIA) statistics, wind and solar energy will continue to be the most expensive way of generating electricity for years to come. Click HERE for a levelized cost analysis of all generating technologies.

For additional information, please contact Patrick Creighton, 202-621-2947, or Laura Henderson, 202-621-2951.


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