Electric & Natural Gas Customer Impact
Electric Customer Impact:
Direct Cost Increase for Customers
- In Waxman-Markey, restrictions begin in 2012. Allocations—credits provided to utilities to cover a portion (but not all) emissions—would be phased out by 2030.
- Considers only cap & trade impacts through the allocated credits & allocation shortfall.
- The CO2 “tax” would result in an increase for electricity bills for all residential, commercial and industrial customers.
Indirect Cost Increase to Customers
- Does not include costs of other provisions of the bill such as Renewable Energy or Energy Efficiency Standards.
- Does not include changes the bill would cause in the broader economy energy resource demand resulting from fuel-switching cost, or demand-side management.
- Does not include cost of new generation to meet demand growth or production needs.
Climate Change Legislation Projected Cost Impact on Cheyenne Light, Fuel & Power Customers |
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|
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Residential
Annual Impact
|
|
2012
|
$0.029 |
33% |
$212 |
$3,810 |
2030 |
$0.059 |
66% |
$427 |
$7,690 |
Notes:
Future power generation and emissions based on BHP & CLFP 2008 Integrated Resource Plan.
Assumes average rate of $0.089/kWh; 605kWh/mo residential, 10,900 kWh/mo commercial.
Assumes cost of $50 per emission credit per metric ton of CO2 emitted. |
Climate Change Legislation Projected Cost Impact on Black Hills Energy - Colorado Electric Customers |
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|
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Residential
Annual Impact
|
|
2012
|
$0.010 |
12% |
$83 |
$620 |
2030 |
$0.015 |
17% |
$111 |
$900 |
Notes:
Future power generation and emissions based on BHE-Colorado Electric 2008 Resource Plan.
Assumes average rate of $0.092/kWh; 605 kWh/mo residential, 4,890 kWh/mo commercial, 469,450 kWh/mo industrial.
Assumes cost of $50 per emission credit per metric ton of CO2 emitted. |
Climate Change Legislation Projected Cost Impact on Black Hills Power Customers |
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|
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Residential
Annual Impact
|
|
2012 |
$0.036 |
47% |
$349 |
$2,030 |
2030 |
$0.061 |
82% |
$601 |
$3,490 |
Notes:
Includes emissions from Wygen III for purposes of calculating emissions for the allocation formula.
Future power generation and emissions based on BHP & CLFP 2008 Integrated Resource Plan.
Assumes average rate of $0.075/kWh; 820 kWh/mo residential, 4,760 kWh/mo commercial, 863,400 kWh/mo industrial. Assumes cost of $50 per emission credit per metric ton of CO2 emitted.
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Cost of Climate Change Legislation for Black Hills Power Customers
Estimated Electricity Cost Percent Increases from CO2 costs associated with climate change legislation as passed by the U.S. House June 26, 2009
Natural Gas Customer Impact:
Direct Cost Increase for Customers
- In Waxman-Markey, the climate change legislation for natural gas would go into effect in 2016.
- This federal CO2 tax would result in a bill increase for all natural gas customers including residential, commercial and industrial.
Indirect Cost Increase to Customers
- Fuel-switching: new power plants would have to be built to replace coal power plants. Second to coal, the most viable energy choice to produce reliable electricity is natural gas.
- Further increases in natural gas costs: Switching to natural gas-fired electric generation will increase the demand for natural gas. Laws of supply and demand suggest when demand for a commodity (such as natural gas) increases, the cost of that commodity will increase as well.
Cost of Climate Change Legislation for BHC Natural Gas Customers On Average
Projected Natural Gas Cost Increases from CO2 costs associated with proposed climate change legislation as passed by the U.S. House June 26, 2009
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Percent Increase on Billing Rate*
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Annual Increase Residential**
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Annual Bill Increase Commercial***
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2016 |
$0.06 |
8% |
$44 |
$186 |
2130 |
$0.27 |
33% |
$191 |
$798 |
Assumes cost of $50 per emission credit per metric ton of CO2 emitted.
*Based on $0.80 per therm billing rate
** Based on residential customer using 720 therms per year
** Based on commercial customer using 3000 therms per year
Estimates do not factor in: natural gas price volatility, increased demand due to the lower CO2 emission rate of natural gas, supply constraints or inflation. |
Cost of Climate Change Legislation for BHC Natural Gas Customers On Average
Estimated increases per therm from CO2 costs associated with proposed climate change legislation as passed by the U.S. House June 26, 2009
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