Isramart : Winners and losers under a Carbon Cap and Trade Law

Isramart news:
Winners and losers under a Carbon Cap and Trade Law. Point Carbon, a market analyst firm, identified in a report released today the winners and losers of the Senate Carbon Cap and Trade bill. The power and oil sector represents 40% of covered carbon emissions. Southern Company is the biggest loser and Excelon Corporation the biggest winner.

The power sector is most vulnerable. Southern company would pay 12% of its operating income to comply with Cap and Trade, American Electric Power would pay 11% and Duke Energy would pay 5%. American Electric Power would pay $2.3 billion annually and Southern company $2.2 billion.

ExxonMobil is the largest carbon emitter in the U.S. at 6% of total national carbon emissions, but its operating income will only slightly suffer under a Cap and Trade law. Based on the price of a ton of carbon projected at $15 per ton, ExxonMobil would pay $5.9 billion annually to comply. Raising gasoline prices 5% would leave ExxonMobil’s total cost of compliance at $277 million per year out of its $84.1 billion operating income. A $15 per ton carbon price translates to an increase of $0.13 per gallon of gasoline.

Some power companies gain under a Cap and Trade system. Excelon would see a net increase of 36% in its operating incoming due to its large portfolio of low emission power generation plants. Other energy company winners are FirstEnergy and PG&E.