Industrial energy consumers object to language in the $816 billion House economic recovery bill that would require state governors to support decoupling of electricity and natural gas volumes from prices in order to get more stimulus funds.
Under decoupling, utility revenues from sales of natural gas and electricity would remain stable even if consumer demand for the commodities fall as a result of energy efficient practices. While the tactic is an incentive for utilities to push energy savings, it would be a “disincentive” for industrial energy consumers to invest in energy-efficient equipment, given that there would be no measurable change in their utility bills, said Paul N. Cicio, president of the Industrial Energy Consumers of America.
The decoupling language was in the House Energy and Commerce Committee portion of the House stimulus package (HR 1), which cleared the House by 244-188 Wednesday with zero support from Republicans. The decoupling provision is being “pushed” by Democrats and environmentalists, Cicio said.
“Decoupling is a direct disincentive for manufacturers to implement energy efficiency projects that improve our competitiveness and reduce greenhouse gas emissions. Decoupling means if we reduce our electricity and natural gas consumption, we will not see a reduction in the costs,” he wrote Thursday in a letter to Sen. Jeff Bingaman (D-NM), chairman of the Senate Energy and Natural Resources Committee.
The Senate is expected to take up its nearly $900 billion economic recovery package next week. Unlike the House, the Senate’s measure does not include a provision on decoupling. There are a number of differences in the House and Senate bills — particularly in the energy area — that will have to be reconciled before the package can be sent to the White House.
“For many manufacturers, the cost of electricity and natural gas is significant and can determine whether they are competitive in global markets. We urge you to not pass legislation that increase electricity or natural gas costs and put more jobs at risk.”
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