The Source - Spring 2009 - (Page 12)

Q&A One-on-one with Senator Jeﬀ Bingaman ON CLIMATE One large issue facing public gas systems is rising costs. A new regulatory program for carbon has the potential to signiﬁcantly raise natural gas prices if not designed properly. What are some of the actions that Congress will be considering to ensure that emission reductions are achieved without signiﬁcantly raising energy prices or hurting the economy? Most importantly, we need to recognize that the cost of unabated climate change will be severe and irreversible. For this reason, I believe it is important to regulate greenhouse gas emissions through a new program, but understand that this program will have costs associated with it as well. The best way to avoid large-scale fuel switching before the economy is to ensure that the design of a program makes sense and is transparent. Many different points of regulation have been discussed for natural gas, but because this fuel is so versatile and has so many different uses, it has been hard to find the perfect spot to avoid double counting and to also account for the majority of the fuels’ emissions. Most proposals have sought to regulate natural-gas processors, while others have explored distribution companies and major users. Better analysis and discussion needs to be had before we can pick an appropriate spot. I will be interested to review what the Energy Information Administration Senate Energy and Natural Resource Committee Chairman Jeff Bingaman (D-N.M.) shared with The Source his thoughts on carbon emission reductions, fuel switching, market transparency and more. “ The best way to avoid large-scale fuel switching before the economy is to ensure that the design of a program makes sense and is transparent. and Environmental Protection Agency say in their efforts to build greenhouse-gas registries. Public gas systems deliver gas for heating to a large portion of ﬁxed-income and elderly consumers who are more dramatically impacted by rising energy costs. How will Congress look to design a carbon-reduction program so that low- and ﬁxed-income consumers will not face dramatically rising energy costs? It’s unclear, but previous attempts to address these impacts have looked at the allocation of greenhouse gas (GHG) permits to assist with the transition. Some organizations have suggested that revenue raised from the auction of such permits could be used to protect lower income households, or others who are adversely affected, by sending them rebates. An effective GHG reduction program needs to send a price signal to the market that there is a cost associated with emissions, but this program needs to be designed so that those costs gradually present themselves and give people Congress needs to design a program that can begin the significant shift of our energy infrastructure to low-carbon fuels but protects consumers and ratepayers in the process. To do that, a number of items must be considered to ensure emission reductions are achieved in a responsible manner. Some of these actions will be the consideration of how stringent the targets are and how quickly we can achieve them. Others actions will be to consider the various cost-containment mechanisms that have been proposed, like banking and borrowing, offsets and price caps. Public gas systems are concerned that climate change legislation could lead to massive fuel switching from coal and other carbon intensive fuels to clean-burning natural gas to generate electricity. This could have dramatic impact on the supply and price of natural gas. Where is Congress considering regulating natural gas, and what will be the implications for fuel switching? 12 THE SOURCE | THE VOICE AND CHOICE OF PUBLIC GAS ” 

Table of Contents Feed for the Digital Edition of The Source - Spring 2009

The Source - Spring 2009 Contents First Person APGA Events Q&A: One-on-One with Senator Jeff Bingaman Great Malls Think Alike The Economy and Your Customers Member to Member New Technology: Saving Energy Never Felt So Good New Technology: Get Pumped! Legislative Outlook The Pipeline Advertiser.com Advertisers' Index At Last

The Source - Spring 2009

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