Thursday, February 2, 2012

How many economists does it take to get people to switch from oil to gas?

ANSWER: None, the market will do it.

For the fiscal year that ended in September, the gas utility UGI completed more than 7,300 residential and 1,600 commercial fuel oil-to-gas conversions, a company record. Yet, the record pace accelerated by another 57 percent in October, November and December, the first quarter of UGI’s 2012 fiscal year.

Prices, not government regulations or mandates are driving the change. Is anyone listening in Washington? How much more evidence do you want that prices deliver change?

If you really think that global warming is a problem and want to find a way to reduce carbon, tax the hell out of it, and then get out of the way.

HT: Carpe Diem


  1. They tried to tax the hell out of carbon dioxide, but that quickly turned into a payoff scheme for connected interests and then was stillborn in congress.

  2. Also, taxes aren't as effective as supply and demand forces, as taxes can be evaded or politicked away.