Duke Energy Corporation CEO James Rogers, left, believes President Obama's auction component in the proposed cap-and-trade program will significantly increase electricity bills. Although Rogers supports the cap-and-trade program, which would set a mandatory limit on global warming pollution and let companies trade emissions allowances on an open market, he opposes an auction of the allowances. He is right. We believe the allowances should be allocated free to utilities to prevent the automatic and immediate increase in utility bills. The Center recommends that President Obama should use the successful example of the Acid Rain Program, which reduced sulfur dioxide emissions in a cap-and-trade program that did not significantly increase electricity prices.
Although Rogers supports an auction of as many as 20 percent of the trading permits, with the revenue going toward research and development of low-carbon technologies, we believe that the ceiling for auctioning permits should be no higher than 5 percent. It is half that percentage in the Acid Rain Program. (Bloomberg.com)
Although Rogers supports an auction of as many as 20 percent of the trading permits, with the revenue going toward research and development of low-carbon technologies, we believe that the ceiling for auctioning permits should be no higher than 5 percent. It is half that percentage in the Acid Rain Program. (Bloomberg.com)
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