Texas’ Light Bulb Law: Not the Brightest Bulb On the Tree

Each January brings with it a slew of laws scheduled to take effect on the first of the year, and 2013 is no exception.  As of Jan. 1, for example, it is now illegal to make or sell new 100-watt and 75-watt light bulbs that do not meet the efficiency standards of the federal Energy Independence and Security Act (nicknamed ERISA).  The plain old tungsten-filament argon-filled bulbs that Edison would have recognized don’t make the cut, so if you like them you’d better scout around and scarf up any old ones in stock, because when they’re gone, you won’t be able to find any more—except maybe in Texas.

Why Texas?  Because a year ago, in defiance of the federal ERISA law, the Texas Legislature passed a kind of anti-ERISA bill that specifically allows Texans to make and sell the old-fashioned inefficient kind of bulbs.  According to one of the bill’s sponsors, however, so far no one has rushed to Texas to set up a light bulb factory—possibly because the only U. S. market would be Texas, avoiding the interstate commerce that would be illegal under ERISA.  Of course, if somebody does eventually start making them here, we might find bordering states setting up checkpoints at El Paso and Texarkana, where tough-looking customs inspectors tell you to roll down your window and ask, “Excuse me, ma’am, but did you buy any live animals, plants, or 100- or 75-watt light bulbs not meeting the ERISA standards while you were in Texas?”

The ERISA standard for light bulbs is an example of how legislating technology can be a hazardous occupation.  The law’s name implies that one of its goals was to lower U. S. energy usage.  There are many ways to do this, but it’s harder to think of a more visible one than to banish a device known to every consumer who has ever changed a light bulb.  Law is fundamentally about justice, and laws should be passed to remedy an existing injustice.  Using slightly more electricity for lighting by using an established technology strikes me as one of the more remote kinds of injustice, so I personally regard this part of ERISA as misbegotten and counterproductive.  The public antagonism and loss of respect for legislative wisdom it has aroused have been a price that seems awfully high compared to the benefits in energy savings it may achieve.

On the other hand, the Texas anti-ERISA law is more along the lines of entertainment, which is something you can count on with the Texas legislature.  We have a very part-time legislative body here in Texas, one that meets only once every two years for a few months.  But what it lacks in duration it makes up for in spectacle.  The late long-time observer of Texas politics, Molly Ivins, liked to recall the 63rd legislative session back in 1973, which started out to reform some campaign laws and other things that genuinely needed reforming.  She reports that the effort petered out about halfway through the session, on Apache Belles Day. 

The Apache Belles are the cheerleading team from Tyler Junior College, and Ivins gives this idea of what the show was like:  “The Belles, all encased in tight gold lamé pants with matching vests and wearing white cowboy boots and hats, strutted up the center aisle of the House with their tails twitching in close-order drill . . . .”  Then the emcee instructed the august assembly of legislators (back then virtually all male) to “look up at the House gallery, where, sure enough, six extra Belles were standing.  At a signal. . . the six turned and pertly perched their gold-laméed derrieres over the brass rail of the gallery.  Upon each posterior was a letter, and they spelled out R*E*F*O*R*M.”  I don’t know if the Lege still has an Apache Belles day, but if they don’t, I’m sure they replaced it with something just as interesting.

The irony of the federal ERISA law is that since its passage, private invention and development has done something that stands a much greater chance of bringing energy independence to the U. S. than throwing away slightly less efficient light bulbs, and without any new meddling whatsoever by the federal government.  Hydraulic “fracking” and horizontal drilling have led to a gas and oil boom in this country which some observers believe will allow the U. S. to produce more oil than Saudi Arabia in a few years, and possibly achieve true energy independence in a few more years after that.  Of course, oil producers get various tax breaks that have been in place for decades, and in that regard they indirectly benefit from federal largesse, but it didn’t take a new federal law to get the inventors drilling.  New governmental restrictions on drilling could slow down or stop fracking, though.

The point is that there is probably an appropriate pace and type of legislation pertaining to technical fields such as energy production and consumption, but figuring out what is appropriate in a rapidly changing field is hard for legislatures to do—even mature, responsible ones, which seem lately to be in short supply.  By far the most influential force in the energy field is economics:  the price of various energy commodities and technologies.  Short of draconian things like rationing, the most that regulators can do is to hobble or accelerate certain industries or technologies with the hope that the desired result is not overwhelmed by unanticipated effects that can make the situation a net loss.

ERISA has another shoe in its hand that will drop next year:  40- and 60-watt bulbs will fall under the regulations, so even the dim little bulb in your old refrigerator will become contraband.  Fortunately, the prices of compact fluorescent lamps and even all-LED bulbs is dropping, and so switching to the new kinds may not be as much of a jolt as you might think.  But if anybody has a bunch of old light-bulb-making machinery in their garage that you’d love to find a use for, come on down to Texas.  I’ll introduce you to a state legislator, and there’s no telling what will happen after that.

Sources:  The Austin American-Statesman carried a front-page article by David Barer on the Jan. 3, 2013 edition entitled “Texas lightbulb law fails to spark makers.”  Molly Ivins describes the Apache Belles visit on p. 12 of her book Molly Ivins Can’t Say That, Can She? (Random House, 1991).

Ethanol in Gasoline: Unintended Consequences

Since 2007, virtually all gasoline sold in the U. S. has contained 10% ethanol, which is about as much as you can put in most cars without having to do a major redesign of the fuel system.  The reason is a federal law called the Energy Independence and Security Act (ERISA), which until last year also subsidized ethanol production to the tune of 45 cents a gallon and imposed a steep tariff on imported ethanol.  Why was this done?  As is often the case with politically-influenced actions, there were advertised reasons and not-so-advertised reasons.  And now that five years have passed, an economist at Texas A&M University has taken a good hard look at the effects of the ERISA mandate, and it is a lesson in unintended consequences.

The advertised reasons for the law were clear.  As the U. S. imports more oil, we become more dependent on the unstable geopolitical situations that prevail where much of imported oil is produced, our trade imbalance grows, and we make a bad situation worse, generally speaking.  The pipe dream of many environmentalists is to convert the entire energy economy to renewable sources:  wind, solar, and biofuels.  At the time, ERISA was passed, ethanol was the only biofuel that had any reasonable chance of making it into the nation’s gas tanks in a reasonable time frame.  While corn was the only practical biofuel feedstock in 2007, it was hoped that cellulose and other waste products could be turned into ethanol in the future.  So far, this hope has not been realized.

People have been making ethanol (grain alcohol) from corn ever since the first moonshiner ran his first still.  It is a fairly straightforward and cheap process, so even without the federal subsidy, so-called “E10” gas (90% gasoline, 10% ethanol) is cheaper than straight 100% stuff.  But instead of simply allowing refiners to mix in up to 10% ethanol if the market and production environment made it favorable, the law mandated a steep ramp-up to full sales of nothing but E10 in a very short time.  So on the surface, we would move that much closer to energy independence with this law.  Well and good.

The not-so-advertised reasons for the law have to do with the strength of the agricultural lobby.  The E10 mandate was a tremendous windfall for everybody who grows corn.  While some ethanol from corn was being used voluntarily as a fuel additive before 2007, the mandate caused this use to skyrocket.  By 2011, according to the Mosbacher Institute report by economist James Griffin, 37% of the entire U. S. corn crop went toward ethanol production.  And corn prices soared from $2.50 per bushel up to as high as $7.50.

If the only people hurt were U. S. food consumers (not everybody drives a car, but everybody eats), it would be bad enough.  But the U. S. grows and sells more corn than any other nation, and much of it is exported to poorer countries, where it is a staple in many diets.  While the rise in corn prices was not solely responsible for the worldwide inflation in food costs that led to food riots in many nations in recent years, the timing is suspicious, and there is no question that the ERISA law led to hardships for many poor people around the world who were now even less able to afford to eat.

Another argument in favor of the ERISA law had to do with global warming.  If you burn gasoline, that directly adds the carbon in the gasoline to the air.  On the other hand, growing corn actually absorbs carbon dioxide from the air, so at first glance you’d think adding ethanol would lower every driver’s carbon footprint.  But a closer analysis that includes all the mechanical energy (fuel-powered) to grow corn and make ethanol reduces ethanol’s edge to only about 20% less carbon emitted per gallon than gasoline.  So that benefit isn’t all it was advertised to be either.

Unintended consequences show up all the time in considering engineering ethics, and the ERISA mandate has plenty.  The parties who appear to have benefited are:  growers of corn and producers of corn-based ethanol (a lot), the U. S. driving public (a little), and the U. S. overall, from the viewpoint of slightly improved energy security.  The losers include refiners (who have had to fool with the mandate and change their processes), anybody who buys corn (U. S. food consumers, U. S. livestock growers, and millions of foreign food consumers, many of whom are poor), and the U. S. public in the sense that they have had to pay the 45-cent-a-gallon subsidy through the U. S. treasury.  Quite a mixed bag, to say the least.

The ERISA experience has shown that mandates of this kind always have unintended consequences, whether or not they are anticipated.  Whether the unintended consequences outweigh the intended benefits often cannot be decided until the mandate has been in place and people have had time to deal with its effects.  It appears to me that we could do without the mandate now that there’s a lot of production capacity in place.  I don’t think corn prices would collapse, and ethanol use in fuels might fluctuate around a reasonable value that would strike a better balance between the advantaged groups and the disadvantaged groups.  But it’s very hard to displace such legislation once it’s in place, so we may have ERISA with us for many years to come.

 

Sources:  All statistics cited are from economist James Griffin’s report “U. S. Ethanol Policy:  The Unintended Consequences” available at http://bush.tamu.edu/mosbacher/takeaway/TakeAwayVol3Iss1.pdf.