Climate treaty will harm U.S. economy, study finds

Abstract

A new study concludes that complying with the Kyoto protocol would have major adverse effects on the U.S. economy. Gasoline prices—now below $1.00 per gal in many areas—would rise to between $1.39 and $1.91 per gal by 2010, and electricity prices would climb 20 to 86%, also by 2010, according to the report prepared by the Energy Information Administration (EIA), the Energy Department's forecasting arm. The EIA study stands in contrast to a forecast released in July by the White House Council of Economic Advisers (CEA), which predicted that implementing the protocol would cause only minor economic disruption. CEA estimated that reducing greenhouse gases 7% below the 1990 level as stipulated in the climate treaty would raise gasoline prices only 4 to 6 cents per gal. The two reports' predicted effects on the macroeconomy also differ. The EIA analysis finds that implementing the protocol would result in a gross domestic product 0.1 to 4.2% lower ...