Saturday, October 22, 2011

Duke Power Rate Hike? –Or- Rate Hike by Politicos through the Mechanism of Government?

Buried in Duke Energy's rate hike are two items: legal monopoly position of Duke Power and the coercive acts by politicos through the mechanism of government to cause Duke to purchase from uncompetitive, subsided energy sources.

Public utilities such as Duke Energy are legal monopolies caused by policies and legislation sponsored in part and promoted in full by the FDR administration. Power was produced privately in a robust competitive market before the policies of the FDR Administration.

Monopoly practices speak for themselves. However, it is worth pointing out that certain politicos do not oppose monopoly; they only oppose private monopoly and welcome public or state monopoly.

The other item to consider is yet another government intervention into the market for electrical power, namely the coercive power of politicos through the mechanism of government to mandate purchase of electrical power from uncompetitive, subsidized energy sources e.g. solar and wind power. Solar and wind power cost per kilowatt hour are far above [in some case four times] the cost to produce power by other means: coal, natural gas, and nuclear where available.

Moreover, a second cost exists for consumers: the cost of tax payer subsidies to solar and wind power companies.

Hence the consumer of electricity is suffering from the effects of monopoly delivery, artificially inflated prices, and is subsidizing the artificially inflated price to boot.

Maybe consumers and taxpayers would be better calling for competitive electrical generation in the private sector, where private companies are free to choose their electric power supply source, and to end taxpayer subsidies to uncompetitive companies.

H/T Triadwatch blog

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