OPINION:
Green energy has long suffered from a lack of consistency, leaving its customers powerless when the wind isn’t blowing or the sun isn’t shining. But renewable energy is amazingly consistent in one regard: It makes everything much more expensive. Whenever a government policy designed to combat climate change promotes greater use of renewables, Americans are as certain to get as soaked as a weekend in a water park. It is simple economics we see every day.
Electricity generated by unsubsidized renewables is still more expensive than market-driven resources. Heavily subsidized electric vehicles (EVs) can cost as much as 40% more on average than gasoline-powered cars and trucks and are far more expensive to repair. The ideological push for renewable energy has depleted domestic oil production, resulting in skyrocketing fuel prices and President Biden begging dictators for more oil. In nearly all instances, the green energy agenda gets its oxygen from squeezing consumers and soaking taxpayers.
Traditionally, the Environmental Protection Agency has led the federal government’s assault for greater use of renewables, but now the Securities and Exchange Commission, charged with policing securities transactions and protecting investors, wants in on the fun. Through its activist chairman, Gary Gensler, the SEC is promulgating a 300-page rule requiring publicly traded companies to meticulously account for and report the impact of climate change on their business operations and financial statements.
This is, by far, the most ghastly and unprecedented corporate reporting mandate so far created, and if upheld, will permanently saturate the economy in a vat of green regulations that will weaken U.S. industry and raise costs on nearly everything produced. It will further force numerous companies out of business and vacuum wealth and savings from Americans’ pockets.
Mr. Gensler argues that investors have a right to know how the companies they are investing in are handling the risk of climate change through “consistent, comparable” data. In response, an ever-growing parade of economists and financial analysts have produced rivers of commentary justifiably slamming Mr. Gensler for acting well beyond the SEC’s statutory powers and investor interests. He has also faced withering criticism for saddling U.S. companies with billions of dollars in new compliance costs, undermining corporate accounting standards, and forcing companies to report meaningless non-standardized data that will be anything but “consistent” or “comparable.”
None of what Mr. Gensler is demanding relates to the SEC’s primary task of overseeing corporate financial operations. Mr. Gensler’s goal is to initiate the creation of a government scoring system to judge how “green” companies are across our economy, something until now relegated only to specific industries. One prevalent example is the auto industry’s CAFE standard, which forces automakers to pay enormous fines if their lineup of vehicles does not achieve a target score for fuel efficiency.
Mr. Gensler’s rule threatens the creation of just this kind of CAFE standard across our entire economy: Be green or pay the price. “Official” company numbers on carbon usage (scrutinized and audited by Uncle Sam) will pave the way for the government to impose or coerce an increasing number of costly restrictions on U.S. industry that will carry all of the inefficiencies and higher costs that are the hallmark of renewable energy.
If the idea of a Big Brother green score concerns you, you are not alone. In a clear sign that Mr. Gensler has gone too far, a dozen Democratic senators wrote to him calling for this proposed rule and others to be delayed pending further review. West Virginia Sen. Joe Manchin is especially (pardon the pun) energized on this issue, rightfully asserting that Mr. Gensler’s rule is a frontal assault on fossil fuels. When lawmakers from the party that heartily cheers nearly every green energy initiative begin to get nervous, that strongly indicates the dire consequences of Mr. Gensler’s disastrous overreach.
Despite Mr. Gensler’s plea that he is trying to help investors reduce risk, the reality is that the government doesn’t collect data, meaningless and inaccurate as it may be, to just shove it in a drawer. The SEC reporting rule would soon become a weapon for Washington to selectively regulate and harass disfavored businesses and industries that they oppose, raising their operating costs across the board and making our nation less competitive globally. It is a price that our businesses, our economy, and consumers cannot afford.
• Gerard Scimeca is an attorney and serves as chairman and co-founder of CASE, Consumer Action for a Strong Economy, a free-market-oriented consumer advocacy organization.
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