Utilities and Energy
Under the proposed measures to reduce carbon dioxide emissions by our current Congress, called cap and trade agreements, everyone should expect utilities and gasoline expenses to increase. This increase will primarily impact the low to middle income families as we expect substantial increases in utility bills. In addition, this will impact heavy users of electricity, primarily in manufacturing, resulting in either the costs to comply with the regulations being passed on to consumers or the transfer of these operations to countries where the cap and trade rules do not apply. This of course will cause more job losses in this country.
It is obvious the goal is not to reduce emissions. The United States has had more reduction of emissions without these agreements than have European countries, which already put these agreements in place. So what is the point? The real goal is to introduce a socialist agenda and to create another profit center for energy producing companies. Ken Lay, former CEO of the now defunct Enron, was a strong proponent of this plan because of the business opportunities and the profits it creates at the consumer’s expense.
As consumers, we should begin rethinking of ways to reduce utility bills. Those with low incomes may find there can be help through the Home Energy Assistance Program (HEAP). Additionally, newer appliances tend to be more efficient than older appliances. An eighteen year old air conditioner can use as much as twice the energy as a newer model.
For those in older homes, window replacement may have long-term savings, but measure how long you plan to stay in the home first. Another great value is to identify energy loss in remote places in the home including crawl spaces, under sinks, and though openings in the basement. Insulating in and around these areas and caulking around doors and windows offer great benefits in reducing heat and cooling loss.
Attic insulation will yield a high value because it reduces heat loss in the winter and cooling loss in the summer. It is also important to know that insulation settles over time reducing the R-factor, or energy loss resistance, and should be replaced. Insulating hot water pipes, changing filters on furnaces, adding hot water heater blankets, and using florescent bulbs rather than incandescent bulbs will also help. My books Saving Without Sacrifice and Saving Without Sacrifice In Action cover over forty more ways to reduce utility bills.
Energy cost should double in the next five years because of inflation and the new cap and trade agreements. As mentioned earlier, fraud is expected to be rampant based on Europe’s experience with these regulations. The environmental effect is considered so remote that it will not be measurable. The economic impact could be devastating. Preparation for what is coming is always the best cure.
Robert Ostrander, CFP®
SWS Advisors, Inc.
