Saturday, February 20, 2010

A worthwhile meeting

Yesterday, I met with Congresswoman Lynn Woolsey and two of her senior staff members. The meeting far exceeded my best expectations. While I have previously blogged in negative fashion about my lack of representation vis a vis energy policy, I am pleased to report both the Congresswoman and I have turned a new page. A week ago I communicated to the Congresswoman’s staff my expectation of the meeting and had sent a PowerPoint deck that illustrated the limitations of bio-fuels, and the painfully slow learning rate photo-voltaic cells, lithium batteries, and fuel cells will enjoy in the future. I suggested that we institute the position of Engineering General of the United States. I also suggested that we rely much more heavily of diesel cars and dual fuel cars but not plug ins with a range greater than 10 miles. I suggested we institute a carbon value added tax at a sufficiently large rate (perhaps as high as $100 per ton of carbon dioxide) on all items manufactured in the USA. Food would be the only item excluded from the carbon value added tax. Imported items would also have a duty imposed on them that is proportional to the carbon emissions in their manufacture abroad and the carbon emissions in their transportation to the United States. No subsidy for the items manufactured in China with their heavy reliance on coal, in fact the duties on Chinese made items would be the highest because of the heavy usage of coal in that country. French manufactured items that used nuclear power would enjoy the lowest duty.

As an example let’s discuss the manufacture of bio ethanol (a pet peeve of mine). The conversion of corn to ethanol requires some 50,000 BTUs of external energy per gallon. If these BTUs are derived from natural gas this equates to approximately 55 cubic feet of natural gas and the carbon dioxide emissions in the process of manufacturing ethanol approximately equals 6.3 pounds per gallon. At $100 per ton or 5 cents per pound the carbon value added tax on ethanol would be 31.5 cents per gallon. I would scrap the 50 cent per gallon subsidy that ethanol now enjoys and this would mean an 81.5 cent per gallon increase in the wholesale cost of ethanol. All transportation fuels would also have a carbon value added tax levied on them. This would be in the form of a fuel tax at the pump. Gasoline and ethanol should be taxed at about one dollar per gallon. Diesel, propane, and compressed natural gas would be taxed at a lower rate of say thirty cents a gallon. A friend of mine in New Zealand has told me that diesel sells for 50 Kiwi cents a liter less than gasoline. The New Zealand government levies far higher taxes on gasoline than on diesel. A significant fraction of the personal cars in New Zealand are diesel. While the Kiwis are really wrong on nuclear power they are certainly right on diesel.

I closed the meeting with the Congresswoman that I would write a policy essay that details my ideas and also details why advanced batteries and cellulosic bio ethanol is destined to be a waste of tax payer money. The Congresswoman will then take my policy essay to the Chairman of the House Subcommittee on Energy that she sits on. My ultimate expectation is to be invited to testify before the committee and go on record with the laws of thermodynamics. The members of the committee may in fact be refreshed to hear this rather than the junk big oil, big ethanol, and the once big three have lobbied for as energy policy that only serves their special interest and simply prevents real policy to be adopted. I must say I felt proud to be a citizen of the United Sates after the meeting and do thank the Congresswoman and her staff for listening to me. While I have been harsh on Lynn Woolsey, I do believe she is a person with principle and passion and is no doubt very honest. Kind of like the Green Machine except like my Kiwi friends she keeps to the left when she drives. The Green Machine drives on the median and is therefore always crashing.


  1. Lindsay --

    I can't agree more with your idea of having a CO2 tax. It will force an even playing field from a green perspective; not only should the tax be levied -- but every product and service should be required by law to disclose how many tons of CO2 went in to delivering the product/service, allowing consumers to make green choices.

    Have you thought about how much additional revenue would be generated by such a levy; and the implications on our multi-trillion dollar deficit, not to mention trade deficits. This would make for an interesting addition to your presentation to congress. Here is a politically palatable idea to climb out from our mountain of debt while boosting our local economies and doing so in a way that is environmentally responsible.

    Go Lindsay!!

  2. Hi Rael

    Thanks for your comment.

    I actually did do a back of the envelope calculation that the $100 per ton of CO2 VAT would add $700 billion to the tax revenues of the USA. The carbon import tax would add about $400 billion and the trillion dollar deficit then goes away. I think you should join me in preparing the essay on policy.


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