Higher Fuel Costs Will Fuel Higher Food Costs

The General James M. Gavin coal plant on the Ohio River

This year has seen the largest food price increases in 3 years, which are up 22% for the first quarter of 2014.

Now, there is a new factor in the equation that will exacerbate increasing food prices, causing them to go up EVEN MORE.

That factor is the new EPA regulations being imposed on the coal industry.

You know, the Cap-and-Trade regulations that would not pass Congress in 2010, given the overwhelming pressure from Americans’ displeasure with the legislation?


In an article on Fox Business on June 4, 2014:

“After cap-and-trade legislation was defeated by Congress in 2010, President Barack Obama directed the EPA to work on rules that would regulate carbon dioxide emissions.

The EPA opened the door to regulating carbon in 2009, when it declared that “greenhouse gases” are harmful to human health and the environment. As a result, the EPA has sought to reduce carbon emissions through the Clean Air Act.

Legal challenges to the Obama administration’s carbon rules are widely expected, with opponents of the move arguing the Clean Air Act was not passed to regulate carbon emissions.

Many companies, most notably Patriot Coal, have turned to bankruptcy amid the industry’s struggles. Meanwhile, shares of coal miner Peabody Energy (BTU) are down 17% over the last year.

The proposal received sharp criticism from Republicans and coal-state Democrats on Capitol Hill.  Senator Joe Manchin (D-W.Va.), issued a statement saying the EPA’s proposal shows “little regard for rising consumer prices, the effects on jobs and the impact on the reliability of our electric grid.”

Manchin also cited data from the Energy Information Administration, which has forecasted that coal will account for nearly a third of electric generation through 2040.

In an interview with FBN’s Rich Edson, Senate Minority Leader Mitch McConnell (R-Ky.) said:

“My point is, why did they think it took legislation in 2010 and it doesn’t take legislation now?” McConnell asked. “This is the kind of executive branch overreaction to everything, and the belief that they can do anything by themselves.” Well, because they tried to do it the right way the first time and didn’t get their way. So now they are going to do it the wrong way. What else is new these days?

“Peabody Energy also came out swinging. The St. Louis-based company called coal “the most reliable and affordable baseload fuel,” adding that coal provided 90% of America’s increased electricity needs during the cold winter months.”

“Energy inequality in the U.S. is an enormous challenge, and access to low-cost energy is a basic need. Yet proposed regulations will make energy more scarce and more expensive without any material improvement in emissions,” said Peabody Energy.

And what is “energy inequality” anyway? It is that familiar mantra that “Americans use more energy than everyone else in the world.” I’m suspecting that this whole Cap-and-Trade scheme is another way to equalize Americans’ use of energy to be more in line with the rest of the world. In other words, bring us down to poverty levels, like other third world countries.

Why do we need to be brought down?  I like air conditioning-especially living in Florida! It is terrible that people in Africa have dirt floors and no a/c, but really – it’s not my fault, and why should we collectively (sorry to use that word) have to suffer because the rest of the world does?

If we are all going to be completely equal, then we need a communist system, where NO ONE has ANYTHING, BUT EVERYONE IS EQUAL!

“Peabody offered an alternative policy path that would increase investments in energy efficiency and promote research and development toward new coal technologies like carbon capture.”

Carbon capture? Where-in hot air balloons? For heaven’s sake, we BREATHE OUT carbon dioxide! Now the government wants us to pay for that? “Capture” a little common sense!

Future for Utility Bills

“S&P’s Jeffrey Panger, who covers public sector utilities, noted how companies will have less flexibility to manage volatility in energy prices without coal to fall back on.

He also said rate increases in the past have been fairly manageable, but unlike other emissions, “there is no commercially viable way to remove carbon. Under a cap-and-trade system, companies would then be required to pay for excess carbon emissions.”

So there it is. There is no way to remove carbon. So, just PAY for it.

If that isn’t an obvious excuse for a massive tax, then I don’t know what is. The government wants to tax carbon emissions, which can not be remedied, and hasn’t proven to harm anything.

Next thing, they’ll want to tax us on the amount of air we breathe. After all, we do breathe out carbon dioxide!

It reminds me of the Science Fiction movie “I Robot”, where the robots are so smart, they determine that in order to save the planet, all humans must die, to avoid the inevitably of humans killing themselves through nuclear war. I seriously think the philosophies of the so-called master minds in this country are on that train of thought.

“The EPA is projecting compliance costs of $8.8 billion a year by 2030, under the assumption that energy consumption will decline.”Here we go again, with a government agency making cost predictions based on consumption projections.

They predictions are almost always wrong, and the costs always come in higher. So, if $8.8 billion a year sounds onerous, then you can count on it being more.

The Chamber of Commerce estimates $51 Billion a year,which is probably more accurate than the EPA, that is implementing the rules. They have to downplay the costs, so people will accept it. And once it’s done, there’s no going back. By the way, that $51 Billion a year – that’s coming out of YOUR pockets, mind you.

“Analysts at Goldman Sachs suggested the direct economic effects of compliance “do not appear to be large.” In a note sent to clients on Wednesday, the investment bank said utility-related construction and equipment investment, as well as a rise in retail utility prices, should help offset a GDP decline of 0.1% or less.”

Just how does a rise in our utility prices offset a GDP decline? Oh, you mean, because the entire GDP of the US is down, because we are in a recession/depression, it will make that GDP number HIGHER, because WE will be dishing out more money for electricity. Oh, that makes sense now!

“However, Goldman Sachs also expects much of the costs to get passed down to consumers. Regulated utilities are typically able to pass through the costs of complying with environmental rules to rate paying consumers,” the analysts wrote.

“Some of the higher utility costs could be passed through indirectly through higher prices for other goods and services, which would increase the effect somewhat.” Increase what effect? The effect of us not having enough money?

So, Obama directed the EPA to do what the American people DON’T WANT- after all, who wants higher electricity prices and fewer jobs? Yes, our dear leader has given the go ahead for massive regulations on the coal industry via the EPA…with no Congressional approval whatsoever.

Not only will these new regulations kill thousands of jobs in the coal industry, but will also shut down plants that can’t afford to keep up with the costly  regulations. Not only will electricity costs go up significantly, perhaps even skyrocket, like Obama planned all along (nice guy that he is- just looking out for the common man), but food prices will increase even MORE.

Food has to travel on refrigerated trucks and sit in electricity- fueled refrigerator cases in the supermarkets. So get ready for ever-increasing inflation on food prices. And if you’re not on a diet now, watch out, you may have to be on one in the near future.

Article authored by Carol Serpa. You can find the original story right here.