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By Joseph A. D'Agostino
© 2000, Human Events

Over 56 million American homes use natural gas for heating, a fact that may be painfully driven home to people if the Kyoto global warming treaty -- strongly backed by Vice President Al Gore -- is ever ratified by the Senate or implemented by presidential fiat.

Why? According to the U.S. Department of Energy, the treaty's protocols could help drive up natural gas prices in the United States by 147 percent in just 10 years.

Wholesale prices for natural gas have doubled in the past year, and the Energy Department's Energy Information Administration expects consumers to pay 25 percent to 40 percent more this winter than last for gas to heat their homes. That equals $200 to $320 more per household. But even discounting what is probably a temporary spike in energy prices, the EIA expects natural gas prices to increase 1.7 percent per year from now until 2020, for a cumulative increase of 50 percent after adjusting for inflation.

Demand for natural gas is growing as the U.S. population expands. And 90 percent of all new power plants scheduled to be built in the United States are designed to run on natural gas.

Natural gas is displacing heating oil, kerosene, propane and electricity as the home-heating source of choice because it is generally cheaper and, compared to oil and kerosene, cleaner. This year, only one-tenth of American homes are relying on heating oil or kerosene for heat, down from 22 percent in 1978.

If Kyoto is not implemented, predicts the EIA, increases in home-heating costs will be offset by lower electricity prices. This is because the next 20 years are likely to see a 0.6 percent-per-year drop in electricity costs as more efficient generating plants come on line and coal prices continue their long decline.

But implementing Kyoto changes everything, according to the Clinton-Gore administration's EIA. The treaty's strict cap on U.S. carbon dioxide emissions would force a drastic increase in the price of all fossil fuels.

The EIA's October 1998 "Impacts of the Kyoto Protocol on U.S. Energy Markets and the U.S. Economy" says, "Households would be faced with higher prices for energy and the need to adjust spending patterns. Nominal energy expenditures would rise, taking a larger share of the family budget for goods and service consumption and leaving less for savings."

This is where the post-Kyoto 147 percent increase in the price of natural gas factors in. Right now, the average American family, heating its home with natural gas, pays $800 per year. By 2010, if the Kyoto treaty is implemented, their annual heating costs will be almost $2,000. Kyoto, in other words, effectively imposes a $1,200 home-heating tax on American families -- no matter how rich or poor they are.

In the wake of the fear generated by the EIA's study, the White House Council of Economic Advisers released its own study, claiming that the Kyoto treaty would drive natural gas prices up only 5 to 9 percent by 2020.

Without Kyoto, U.S. carbon dioxide emissions should increase by 1.2 percent a year until 2020, meaning a 45.3 percent increase over 1990 levels, according to the EIA's study. But Kyoto mandates that the U.S. reduce carbon dioxide emissions to a level 7 percent below what they were in 1990. The only way to achieve that goal, says EIA, is to impose massive taxes on fossil fuels based on carbon emissions.

That would not only make fossil fuels more expensive in general, but also would increase demand for natural gas, which produces only one-third the carbon dioxide of coal, and two-thirds the carbon dioxide of oil, for the same unit of heat production.

Without Kyoto, consumers could switch to electricity to save money as gas prices rise. Residential electricity costs have dropped 20 percent since 1990 and are expected to drop more with deregulation as natural gas prices rise, but Kyoto would double the cost of electricity, according to EIA. That is because, according the electricity industry's Edison Electric Institute, half of the cost of electricity is the cost of the fuel used to generate it.

"We're a fossil fuel-based economy. We use carbon fuels as our primary energy source, period. If you restrict the use of carbon-based fuels, you restrict the use of energy," wrote Mark Mills in "Kyoto and Our Collective Economic Future: Economic and Energy Underpinnings," a study published by the Competitive Enterprise Institute.

If you leave out nuclear power, alternative technologies -- including those often pushed by Gore -- do not yet exist on a scale to power the country.

"There is simply no credible evidence in physical reality or technology to suggest that the enormous energy needs of the U.S. economy can be met for the foreseeable future in any other way," says Mills. "Carbon fuels have also been the primary source of energy growth and they're projected by the U.S. Department of Energy to constitute 90 percent of all new energy supplied for the next two decades."

Without Kyoto, declining energy costs have been a source of middle-income prosperity. According to the Bureau of Labor Statistics, families making less than $40,000 annually saw their energy costs as a percentage of their expenses drop 2 percent between 1985 and 1998.

Related story:

Coal miner: Gore presidency spells doom

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