Oklahoma Decides Your Energy Independence Should Cost You

In what could only be described as one of the strangest rationalizations for a cash grab by a local government, the state of Oklahoma yesterday, with little fight whatsoever, decided that they would tax people (through public utilities) for installing solar or wind power on their property.

That’s right, folks.  You’re going to be taxed for the mere privilege of installing power generation apparatuses that make you more energy independent.   The argument in favor is as dumb as the idea itself.

Representatives of Oklahoma Gas and Electric Co. and Public Service Co. of Oklahoma told The Oklahoman that the surcharge recovers “some of the infrastructure costs to send excess electricity safely from distributed generation back to the grid.”

We’re not anti-solar or anti-wind or trying to slow this down, we’re just trying to keep it fair,” Oklahoma Gas and Electric Co. spokeswoman Kathleen O’Shea told the Oklahoman. “We’ve been studying this trend. We know it’s coming, and we want to get ahead of it.”

Of course they’re not against either, but when you say you want to “keep it fair” and then you get government legislation to level that playing field, I’d hardly call that fair in any fashion.

Utility companies are a funny breed.  Usually they’re some sort of legal monopoly in the areas in which they operate.  Even in cases where the relationship is more adversarial, local governments often act as rubber stamps to the utility company whims because they enjoy the taxes and fees that are collected on their behalf.  It’s a cozy agreement that often ends up screwing customers over simply because…  Well…  What are you going to do?

As we’ve learned in Oklahoma, you aren’t just going to switch off and provide your own power because you’re gonna be taxed, ostensibly because it costs money for you to give free surplus energy back to this giant energy provider.   Imagine the audacity of that?  You’re being taxed because it costs money to give energy back to the power company that’s going to resell it at full price and the government will charge its usual taxes on.

The mind boggles.

What if you didn’t want to let them have that excuse and just kept yourself disconnected from the grid and supplied your own energy and didn’t net it out to the utilities? In states, like Florida, you can’t even opt out if you want to.  In fact, a recent case, a woman was penalized for not being hooked up to the local sewer system (after she was dragged to court for not being hooked up to the water, electric, or sewer system).  She was later found not guilty for not having water and electricity from the local utility, but was penalized for not being hooked up to the city sewer, because as you know, without government who will transport the crap?

This is complete and utter madness, but this is what happens when government gets cozy with any business or industry.  They regulate all competition out of business, or make it so difficult to compete that potential competitors just don’t bother.  They charge licensing fees, make “franchise agreements” and then wink and nod when utilities ask for a rate increase, usually putting up token resistance but often rubber stamping any requested increases.  In fact, for all the talk about how regulation is needed, often the regulations are put in place in such a way that not only do they not protect consumers, they are actually antagonistic toward them.

In New York State right now, United Water, one of the largest water providers outside of New York City is making their case for a major rate increase.  Politicians in the area are flocking to get in front of cameras to condemn the increase for its impact on families, the children, pet lizards, and paper dolls.  If anyone is willing to listen, one can find one of these guys blathering on and on about how it would hurt the local economy to have a rate increase.

So what are they planning to actually do?  Introduce competition?  Fast track permits for new providers?  Allow competing sources and delivery methods?  Encourage rainwater collection?

Of course not.  If you’re New York State Senator David Carlucci, you’re getting petitions signed.  That’s right, the State Senator in one of the areas most affected by a rate increase has decided that the best way to put fear in the hearts of the largest company providing water in the area is a petition drive, and, you guys, he has like 500+ signatures.

I can see United Water’s terror upon that news.

Governments have no idea how to run an economy, how to promote competition, and how to protect consumers.  If United Water knew that David Carlucci was working to fast track another provider, change regulations to make it easier to compete, or even allow out of state providers to pipe in new water, United Water would change their mind out of fear of losing customers.  Instead, Carlucci, devoid of innovative real solutions is getting petitions signed like someone who wants to get their local condemned house made into a landmark.

If Carlucci really wanted to flex some muscle, he could make a case that United Water would get their license revoked, their preferred status removed, and so on, but that would only work if he wanted to back up his tough talk on a rate increase with actual effective action.  Petitions and talking, as everyone with a brain understands, are all symbolic.

I don’t know what the perfect answer is, but in the case of Oklahoma, Florida, and soon New York, the one common element is government regulation.  In fact, without government regulation, or with a government who wasn’t in bed with the utilities for mutual benefit, things could grow, and expand.

It reminds me of the old saying libertarians have come up with when people say “Who would build the roads?”  One libertarian famously replied, “If we didn’t have government, we’d have flying cars and wouldn’t need roads.”

In Oklahoma, the government has essentially told people their independence, while being less of a strain on both the grid and the environment, is to be punished.  This is a clear example of the government interfering in a market and manipulating outcomes.

At some point we have to learn that regulation and licensing does not protect consumers, and maybe with these three recent cases so close together people will wake up to it.

 

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