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State of the State: Our daily habits drive the state's economy with private property

Bethany Jaeger
WUIS/Illinois Issues

Worrying about the environment seems rather trendy these days. That's not to demean former Vice President Al Gore's new global warming film, An Inconvenient Truth, nor is it to belittle increasing awareness of global warming. But the reality is that we often don't start caring about an issue until we learn how it relates to our checkbooks or, worse, our health.

Between doctor's visits and high energy bills, consumers are starting to care. By now, many know that coal-fired power plants release mercury, which falls into rivers and lakes, combines with bacteria to form methylmercury and accumulates in fish. Eating the contaminated fish poses a risk of developing learning disabilities and neurological problems.

Yet we don't know how to wean ourselves from environmentally unfriendly energy sources.

We also know that gas-guzzling cars create a demand for oil and contribute to air pollution that seeps back into our lungs and puts us at risk of developing asthma, heart disease or cancer. 

But we continue to pay the $40 to $50 it costs to run our cars so we can get to work and to grandma's house.

We consider ourselves aware because we know about the problems. But, in this case, knowledge hasn't necessarily brought power. We all know there's no magic pill or life-size bubble that can shield us from environmental hazards. So we sit and wonder when, and how, the government will relieve us from these threats to our health and income.

That's part of the problem. It's too easy to dismiss the challenge as a federal or state policy issue. It's far more difficult to figure out what we, as individuals, can do about it.

In reality, what we eat, drive and throw away has an impact on the environment, which has an impact on our health, then our wallets. Eventually, our daily habits have an impact the state's economy.

The price tag includes the public cost of preventive care, including access to routine checkups. If we do get sick, the state helps foot the bill for our treatment in emergency rooms, hospitals or long-term care facilities. 

There's a social cost, too: decreased productivity, increased unemployment and more demand for governmental assistance. And, of course, there's the cost of implementing regulations to change our behavior. In essence, our tax dollars are being used to protect us from self-inflicted vulnerabilities.

What we eat, drive and throw away has an impact on the environment, which has an impact on our health, then our wallets. Eventually, our daily habits have an impact on the state's economy.

The Catch-22 is that what we do and consume drives the state's economy. For instance, our demand for heating and lighting benefits the state's coffers.

The more energy we use, the more money is generated through the state's electricity excise tax. Electric suppliers pass the tax on to residential customers by tacking it onto their electric bills. In fiscal year 2005, that tax revenue totaled $348 million for the state's general fund, according to the state's Commission on Government Forecasting and Accountability. That's down from $351 million in fiscal year 2000, but up $55 million from a decade ago.

One environmental group argues state policy sets a bad precedent because it encourages more energy production and consumption. A 2003 report by the Illinois Public Interest Research Group says, "The mantra for energy policy over the years might read, 'More is better. The more energy we're using, the better our economy is doing.'"

The environmental consequence is air and water pollution. The U.S. Environmental Protection Agency's Toxics Release Inventory for 2004, the latest available, says electric utilities reported 67 percent of all air emissions of mercury in 2004. Those emissions increased by more than 4,200 pounds, from about 90,330 pounds in 2003 to 94,600 pounds in 2004.

In Illinois, we draw nearly half of our energy from coal-fired power plants and less than 1 percent from renewable energy sources.

The state's 21 coal plants emit 71 percent of the state's mercury emissions, according to Jim Ross, manager of the Division of Air Pollution Control at the Illinois EPA. He filed testimony as part of a June hearing held by the Illinois Pollution Control Board regarding Gov. Rod Blagojevich's proposal to tighten standards and limit mercury emissions.

Deborah Rice, who studies how exposure to environmental chemicals affects the nervous system, also filed testimony as an independent expert for the Illinois EPA. A toxicologist at the Maine Center for Disease Control and Prevention, she said exposure to the hazardous form of mercury — called methylmercury —  can cause deficits in attention, language, memory and muscle coordination.

Health problems associated with exposure to methylmercury include a lower IQ, which has implications for the economy in terms of lost wages and increased dependency on welfare, among other social consequences, she said in her testimony.

Marie Tipsord, an attorney with the Illinois Pollution Control Board, says the panel received about 6,000 comments in response to the governor's proposal. The plan is intended to reduce mercury emissions from Illinois coal-fired power plants by 90 percent before mid-2009, a stricter regulation than the federal government's standards. The 2005 Clean Air Mercury Rule is designed to reduce mercury emissions by 70 percent when implemented.

If the governor's idea wins approval, then the state could pay about $33 million more a year in control costs, according to Ezra Hausman, senior associate with the research and consulting firm Synapse Energy Economics Inc. In his testimony, Hausman said the estimated price tag reflects the power companies' cost to retrofit and operate the new mercury controls. 

"It does not translate directly into electricity prices and costs to consumers," he said. He estimated the annual cost to consumers as a whole at up to $11 million. But, he added, each ton of mercury emissions removed from the air would save in health care costs.

Hausman cited a 2005 report by the Northeast States for Coordinated Air Use Management that shows the country could save about $182 million to $194.5 million per ton of mercury removed each year. Over 10 years, savings could amount to billions of dollars.

The Illinois Public Interest Research Group agrees that spending now could save later. 

Rebecca Stanfield, state director of the research group's environmental program, Environment Illinois, says energy efficiency is the most cost-effective way to reduce cancer-causing carbon emissions, and it's a necessary step for lowering our energy demand. "It can displace a lot of the more polluting and increasingly expensive sources of power that we rely on," she says.

The state, for instance, saved about $4 million between November and April just by setting a standard temperature for operating and nonoperating hours in state-owned and -leased buildings, says Donald Barnes, energy manager for Central Management Services.

That $4 million helped offset the anticipated $20 million increase in natural gas bills, he says.

But it's actually the residential sector that has the greatest potential for more efficient lighting and water heating, according to the Chicago-based Environmental Law and Policy Center. Its Repowering the Midwest report says Chicago-area residents who swap conventional incandescent lights with compact fluorescent lamps could save about $50 in electricity costs over the life of the lamp.

Other energy-efficient appliances are available in Illinois. The center gave an example: Lake Zurich's Osram Sylvania, which manufactures efficient lighting.

Environment Illinois hopes the state will join others in enforcing energy efficiency standards for residential buildings, Stanfield says. If businesses and homes used the most energy-efficient appliances, they could save about $1.7 billion between 2005 and 2030, according to the 2003 report by Illinois Public Interest Research Group, the Illinois PIRG Education Fund, the Appliance Standards Awareness Project and the American Council for an Energy-Efficient Economy.

"This is money right now that's going out of state to pay for imported natural gas from the Gulf or from Canada, Stanfield says. "Keeping that $1.7 billion in the state would be a big economic boost to the state's economy."

While she says consumers can use their purchasing power to choose efficient ceiling fans, refrigerators, air conditioners and set-top boxes for digital cable, to name a few instances, our instinct, unfortunately, is right in some regards — the long-term solution does need to come from policymakers.

Until the state figures out how to encourage us to be energy efficient, drive fuel-efficient cars or take mass transit, we all foot the bill to protect the environment and ourselves from our self-inflicted cycle: consume, pollute, get sick, pay; consume, pollute, get sick, pay. 

 


Bethany Carson can be reached at capitolbureau@aol.com.

Illinois Issues, July/August 2006

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