GUEST COMMENTARY: Unplug Hoosier tax for synthetic natural gas

2013-04-10T00:00:00Z GUEST COMMENTARY: Unplug Hoosier tax for synthetic natural gasBy Denise Abdul-Rahman nwitimes.com
April 10, 2013 12:00 am  • 

The Indiana NAACP Environmental Climate Justice Program advocates sustainability of our communities. We support energy production that is environmentally and economically cognizant. At the same time, we guard against energy projects that threaten Indiana’s communities, economy and job creation. Those are the very risks we all face with the proposed Leucadia Corp. tax to prop up a planned coal gasification plant in Spencer County.

A few years ago, Indiana entered into an agreement with Leucadia to purchase synthetic natural gas from its proposed coal gasification plant in Spencer County. The 30-year agreement forces Hoosier ratepayers to buy the plant’s expensive synthetic natural gas, even though natural gas today can be purchased for less on the open market, and covers 100 percent of the losses on the plant — amounting to a new tax on families.

From the self-employed entrepreneur to the small business owner to the local factory, Leucadia’s coal gasification tax will affect our entire economy, especially communities of color and low-income communities.

According to a recent study by the Kelley School of Business at Indiana University, the Leucadia contract “will act like an excise tax applied to natural gas customers.” For the average family, energy bills will go up by almost $400 over the first eight years of the Leucadia Corp. contract. Small businesses will be paying at least $2,000 more, and small industrial businesses could be charged as much as $250,000 more over the first eight years. On average, the IU study says, 1,800 jobs will be lost each year if the contract remains in place and the plant is built.

When you see the Leucadia tax on your natural gas bill, it will be a monthly reminder of two very simple things: higher bills and fewer jobs.

In 2009, African-Americans spent $49 billion nationally on energy and yet only held 1.1 percent of the energy jobs, according to the NAACP's Environmental Climate Justice Program. Access to affordable energy varies widely, and the proportion of one’s income spent on energy is higher for lower income communities and communities of color. This proposed Leucadia tax would force lower income communities and communities of color to spend even more of their hard-earned income to cover losses on the plant.

What we seek is “energy democracy” as referred by the Center for Social Inclusion, not a new tax on families that will saddle communities of color with additional burdens.

Before it’s too late, our elected leaders must ensure Leucadia’s tax never appears on our natural gas bills. It's time our leaders in the General Assembly stood up for jobs in Indiana by preventing this absurd, government-sponsored Leucadia coal gas tax.

Denise Abdul-Rahman of Indianapolis is environmental climate justice chair of the NAACP in Indiana. The opinions are the writer's.

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