Biden’s fantastic claim of $500 in annual utility savings

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“A dozen CEOs of America’s largest utility companies told me earlier this year that my plan would reduce the average family’s annual utility bills by $500 and accelerate our transition from utility-generated autocrats.”

– President Biden, in an opinion piece titled “My Plan to Fight Inflation,” published in the Wall Street JournalMay 30

This line caught our attention. After all, the typical American family spends an average of $2,060 a year on utility bills, according to the latest estimate published by Biden therefore promises big savings.

But it turns out the White House indulged in some inflation.

If that $500 figure sounds familiar, it’s because you heard something similar in the President’s State of the Union address on March 1. He said his US bailout would “reduce energy costs for families by an average of $500 a year by tackling climate change.”

This figure referred to a report published in October by the Rhodium Group, a research company. Rhodium predicted that if Biden’s climate change policies were enacted, by 2030 the “national average annual household energy costs” would be “about $500 lower than current policy.”

First of all, that’s eight years from now – not much help with the current inflation problem, which was the setting for Biden’s op-ed. But the bigger problem is that “National Average Annual Household Energy Costs” is not the same thing as household utility bills.

John Larsen, partner at Rhodium and lead author of the report, said the estimate includes both home energy services and the cost of driving. The two are roughly equal in terms of energy costs at $4,163 — $2,126 for mobility and $2,037 for home energy. (Note that the home energy item is similar to the EnergyStar rating.)

But most of the estimated savings, Larsen said, come from the engine side of the equation. “Of the $495 in savings, $403 comes from mobility savings (spending less money on gas through more efficient cars or electric vehicles) and the rest is household energy savings,” a- he wrote in an email.

Indeed, the report notes that, if the Biden climate plan were adopted, household electricity bills by 2030 would be between a dollar more and five dollars less than under the current policy. It might pay for an extra ice cream cone during the summer.

Larsen noted that Biden, in the op-ed, was referring to learning that number during a conversation with utility executives, so he didn’t appear to be referring to the Rhodium report. “I can say that our numbers represent savings on all household energy expenditures and not just those associated with utility bills,” he said.

But when we located the transcript of Biden’s conversation with utility leaders on Feb. 9, we found no reference to $500 in utility savings. The figure was also not mentioned in the minutes of the White House meeting.

Somehow, as inflation became a hot political issue, the $500 figure quoted in the State of the Union address seems to have morphed into a reference to utility bills. public. A May 10 White House statement on the “Biden-Harris inflation plan,” for example, called on Congress to pass clean energy legislation that would “save families about $500 a year. on their utility bills.

Indeed, when we asked the White House for the source of the figure mentioned in the Biden op-ed, we received… a link to the Rhodium report.

The president wrote in an opinion piece on his inflation plan – presumably endorsed by staff – that utility executives told him “my plan would reduce the annual utility bills of an average family by 500 $”.

But he didn’t hear that from utility leaders.

And the report he cites is not about savings on household bills.

Most of the claimed savings come from reducing the cost of driving.

And the estimate is for 2030 – when he would no longer be president, even if he served a second term.

Is there any doubt that the president wins four Pinocchios?

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