Category: Regulations

Wind and Solar Power Prices Have Doubled Since Pandemic, Due Partly to Regulatory and Policy Challenges

(p. B1) After more than a decade of declining prices for wind and solar power, the cost of renewables has been ticking up, pushed by everything from macroeconomic forces to countries’ attempts to take control of their energy-supply chains.

The cost of large-scale solar and wind power rose as much as 20% last year versus the year before in most of the world, the International Energy Agency said in a June report. In the U.S., financial-services company Lazard’s widely watched report on the cost of power generation logged its first increase for renewables this year since it started (p. B4) tracking it nearly 15 years ago.

The whiplash has been particularly bad among renewables developers in the U.S., many of whom have rewritten contracts to stay afloat. The price they are charging long-term buyers for their electricity has doubled since the pandemic and risen nearly 30% in the past year alone, according to clean-energy marketplace LevelTen Energy.

. . .

The U.S. has . . . challenges, including policies that make it harder and more costly to import solar panels and other clean-energy components. Rising labor costs and delays in permitting or getting projects hooked up to the power grid have made building solar and wind projects more expensive.

For the full story, see:

Phred Dvorak. “Price of Green Power Is on the Rise.” The Wall Street Journal (Monday, Aug. 14, 2023): B1 & B4.

(Note: ellipses added.)

(Note: the online version of the story has the date August 13, 2023, and has the title “Green Power Gets Pricier After Years of Declines.”)

Long Waits for Italian Cabs Due to Regulations Limiting More Cabs and Ride-Sharing

(p. A4) Returning to Rome from Naples one Monday afternoon in June [2023], a train trip that takes just over an hour, Daniele Renzoni said that he and his wife waited for more than an hour and a half at Termini station for a cab under a blazing sun.

“Just image a long line of grumbling, frustrated people, complaining, cursing. Hot day, angry tourists, there’s not much else to say,” said Mr. Renzoni, who is retired. “Taxi drivers will tell you there’s too much traffic, too many requests, too much everything, but the fact is, the customer pays.”

The situation is “a disgrace to Italy,” said Furio Truzzi, president of the consumer rights group Assoutenti, one of several associations that protested the shortage.

. . .

Thanks to the taxi lobby, ride-sharing services are almost nonexistent in Italy, where Uber is the only platform in use, with many restrictions.

The government lost an opportunity for real change, said Andrea Giuricin, a transportation economist at a research center at the University of Milan Bicocca. He said the best way to meet consumer needs would be to increase the number of licenses for Italy’s chauffeur services, known as N.C.C., which work with Uber.

“It’s very difficult in Italy” because “there isn’t a culture of liberalization in general,” creating little opportunity for competition, said Professor Giuricin. Taxis “are a small but powerful lobby” that easily influences politics, “which is very weak” in Italy, he said.

Angela Stefania Bergantino, a professor of transportation economics at the University of Bari, pointed out that previous governments had tried to open up the taxi market. But they failed.

“The problem is that taxis are regulated by municipal governments, which can find themselves captive in the sense that it is difficult for City Hall to implement policies that the cab lobby doesn’t like,” she said. “These are lobbies that have effective strike tools,” like wildcat strikes or traffic blockages that can paralyze entire cities, she said.

. . .

Above all, though licenses are issued by the city, they can then be sold by the drivers, for sums that can reach 250,000 euros, or about $276,000, depending on the city — a retirement nest egg for many. With an influx of new licenses, the value of an existing license would depreciate.

City administrators fear cabbies could revolt and strike if the status quo changes. “If I decide to issue new licenses,” said Eugenio Patanè, Rome’s city councilor in charge of transportation, “I’m going to find 1,000 taxis blocking traffic in Piazza Venezia,” the downtown Rome square that taxi drivers habitually clog while protesting.

For the full story, see:

Elisabetta Povoledo. “Getting a Cab in Italy Is Hard. But Remedying That Isn’t Easy.” The New York Times (Friday, August 11, 2023): A4.

(Note: ellipses, and bracketed year, added.)

(Note: the online version of the story has the date Aug. 10, 2023, and has the title “Getting a Taxi in Italy Is Too Hard. Fixing That Is Not Easy.”)

To Cut Out Costs of Car Dealership Middlemen, Tesla Is Selling Direct from Indian Reservation Showrooms

(p. D6) Tesla is ramping up efforts to open showrooms on tribal lands where it can sell directly to consumers, circumventing laws in states that bar vehicle manufacturers from also being retailers in favor of the dealership model.

Mohegan Sun, a casino and entertainment complex in Connecticut owned by the federally recognized Mohegan Tribe, recently announced that the California-based electric automaker will open a showroom with a sales and delivery center this fall on its sovereign property, where the state’s law doesn’t apply.

The news comes after another new Tesla showroom was announced in June, set to open in 2025 on lands of the Oneida Indian Nation in upstate New York.

“I think it was a move that made complete sense,” said Lori Brown, executive director of the Connecticut League of Conservation Voters, which lobbied for years to change Connecticut’s law.

. . .

Brown noted that lawmakers with car dealerships that are active in their districts, no matter their political affiliation, traditionally opposed bills allowing direct-to-consumer sales.

. . .

Over the years in numerous states, Tesla sought and was denied dealership licenses, pushed for law changes and challenged decisions in courts.

. . .

Tesla opened its first store as well as a repair shop on Native American land in 2021 in New Mexico. The facility, in Nambé Pueblo, north of Santa Fe, marked the first time the company partnered with a tribe to get around state laws, though the idea had been in the works for years.

For the full story, see:

SUSAN HAIGH, Associated Press. “Tesla to Open Showrooms on Tribal Lands to Circumvent Laws.” Omaha World-Herald (Sunday, Aug. 13, 2023): D6.

(Note: ellipses added.)

(Note: the online version of the story has the date Aug. 5, 2023, and has the title “Automaker Tesla is opening more showrooms on tribal lands to avoid state laws barring direct sales.”)

Crisis in Wind Industry Due to Inflation, Regulatory, and Grid Connection Hurdles

(p. B5) The wind business, viewed by governments as key to meeting climate targets and boosting electricity supplies, is facing a dangerous market squall.

After months of warnings about rising prices and logistical hiccups, developers and would-be buyers of wind power are scrapping contracts, putting off projects and postponing investment decisions. The setbacks are piling up for both onshore and offshore projects, but the latter’s problems are more acute.

In recent weeks, at least 10 offshore projects totaling around $33 billion in planned spending have been delayed or otherwise hit the doldrums across the U.S. and Europe.

“At the moment, we are seeing the industry’s first crisis,” said Anders Opedal, chief executive of Equinor, in an interview.

. . .

The holdup of projects that could generate 11.7 gigawatts—enough to power roughly all Texas households and then some—likely pushes 2030 offshore wind targets out of reach for the Biden administration and European governments.

. . .

(p. B11) The list of woes is long: inflation, supply-chain backlogs, rising interest rates, long permit and grid connection timelines. The increasing pace of the energy transition has created a loop of escalating costs.

For the full story, see:

Mari Novik and Jennifer Hiller. “Wind Power Stumbles as Problems Mount.” The Wall Street Journal (Tuesday, Aug. 8, 2023): B5 & B11.

(Note: ellipses added.)

(Note: the online version of the story was updated Aug. 7, 2023, and has the title “Wind Industry in Crisis as Problems Mount. The online version says that the title of the print version is “Wind Power Stumbles as Cost, Logistical Problems Mount.” But my print version of the national edition had the shorter title “Wind Power Stumbles as Problems Mount.”)

Deregulation “Unleashed Powerful Forces of Innovation and Consumer Benefit”

(p. A13) The railroads harmed small merchants who were tied to the older system of roads and canals. But even those who benefited from railroads—notably farmers and producers of raw materials—feared the power of the enterprises that provided them with large new markets. The anxieties of innumerable small players generated powerful political energy, culminating in the Interstate Commerce Act of 1887, which created the ICC—and with it the template of the independent regulatory commission.

The historian Gabriel Kolko famously argued that the ICC was created by and for the railroads themselves, as a solution to a problem of intense competition. But more-recent research has shown that the interests of shippers were also at play, and by the early 20th century the ICC had essentially been captured by the shippers. The result for the railroads was absurdly low rates of return and an inability to raise capital. The ICC also became a bottleneck through which virtually all railroad business decisions had to pass.

Thus began the long and steady decline of the American railroad industry, which wasn’t arrested until surface freight was deregulated (and the ICC ultimately abolished) in the 1970s. Throughout its life, the ICC repeatedly stood in the way of innovation, including containerized shipping.

. . .

It is fashionable nowadays to dismiss unleashed powerful forces of innovation and consumer benefit of the late 20th century as an unfortunate if fleeting episode of “neoliberalism.” In fact, dismantling some of America’s rigid and retrogressive regulatory institutions unleashed powerful forces of innovation and consumer benefit. Before we attempt to rebuild those structures, we need to examine the lessons of history.

For the full commentary, see:

Richard N. Langlois. “Warren and Graham Emulate History’s Failed Regulators.” The Wall Street Journal (Saturday, Aug. 5, 2023): A13.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date August 4, 2023, and has the same title as the print version.)

Langlois’s commentary can be viewed as an application of the narrative in his book:

Langlois, Richard N. The Corporation and the Twentieth Century: The History of American Business Enterprise. Princeton: Princeton University Press, 2023.

Nimbly Use What Is Available Now Rather Than Wait for Adoption of Perfect Global Standards

(p. A9) For more than five decades, Don Bateman led teams of engineers at what is now Honeywell International in creating and enhancing technology that warns pilots of impending disasters.

The result is an array of software and equipment, much of it mandatory, that squawks warnings and flashes digital admonitions if a plane is heading into a mountain, a ridge, a radio tower or some other obstacle.

. . .

Rather than waiting years for global industry standards to be adopted, he always wanted to use whatever technology was available immediately. Ratan Khatwa, a former Honeywell colleague of Bateman, recalled his advice: “You’ve got to work like farmers,” using whatever is available now rather than waiting for perfection.

For the full obituary, see:

James R. Hagerty. “Safety Engineer Helped Pilots Avoid Crashes.” The Wall Street Journal (Saturday, June 3, 2023): A9.

(Note: ellipsis added.)

(Note: the online version of the obituary has the date May 30, 2023, and has the title “Don Bateman, Champion of Airline Safety, Dies at 91.”)

Socialist Alexandria Ocasio-Cortez (AOC) Buys Foreign Sunscreens Not Approved by U.S. Government F.D.A.

(p. 2) After months of prompting, I have finally managed to help my husband form a daily sunscreen habit. Whenever I see traces of paper white cream in his dark beard, I think, We’re halfway there.

Hoping to avoid the white cast, heaviness and greasiness common in many sunscreen products available in U.S. drugstores, some Americans, including Representative Alexandria Ocasio-Cortez of New York, have taken matters into their own hands, opting for sunscreens manufactured abroad. In a recent interview, the congresswoman said she toggled between Bioré in the summer and Beauty of Joseon in the winter — two Asian brands that employ active ingredients not approved for use in the United States.

“The technology is very sophisticated,” Ms. Ocasio-Cortez said. “You don’t feel like you have a layer of sunscreen on, and it kind of just feels like you’re putting on a moisturizer in that sense, which makes it easier to use.”

While sunscreen is regulated as a cosmetic in major skin-care hubs like South Korea, Japan and the European Union, in the United States, it falls under the purview of the Food and Drug Administration. Any drug product marketed to American consumers must be approved by the F.D.A., and because sunscreen “makes a drug claim” — namely, that it can prevent sunburn, decrease the risk of skin cancer and mitigate early skin aging — the agency regulates it as an over-the-counter drug.

The last time the Food and Drug Administration approved new active ingredients for use in sunscreens was more than two decades ago, and at times it can feel as if the rest of the world has surpassed the United States in the development of new sunscreen formulations and protocols. Skin-care influencers on TikTok and Instagram are in a near-constant state of frenzy over exciting new products and innovations that are nowhere to be found on American shelves. Currently there are 14 sunscreen filters approved for use by the F.D.A. The European Union employs more than 30.

Frustrated by what seems to be a wealth of more exciting options for sun protection overseas, skin-care-conscious Americans have been quick to point the finger at the F.D.A. for the delay in approving new active ingredients.

For the full story, see:

Sandra E. Garcia. “U.S. Sunscreen Is Stuck in the ’90s.” The New York Times, SundayStyles Section (Sunday, August 13, 2023): 2.

(Note: the online version of the story has the date Aug. 12, 2023, and has the title “U.S. Sunscreen Is Stuck in the ’90s. Is This a Job for Congress?”)

Regulations Block Flexible Transformation of Manhattan Buildings

(p. A1) There is an aging office building on Water Street in Lower Manhattan where it would make all the sense in the world to create apartments. The 31-story building, once the headquarters of A.I.G., has windows all around and a shape suited to extra corner units. In a city with too little housing, it could hold 800 to 900 apartments. Right across the street, one office building not so different from this one has already been turned into housing, and another is on the way.

But 175 Water Street has a hitch: Offices in the financial district are spared some zoning rules that make conversion hard — so long as they were built before 1977. And this one was built six years too late, in 1983.

“There’s nothing about that building — its construction, its mechanicals, its structural engineering — that prevents it from being converted,” said Richard Coles, the managing partner of Vanbarton Group, which has developed both conversions across the street.

. . .

Healthy cities must build new things and rehabilitate old ones. But they also perform regular tricks of transmogrification, (p. A13) turning existing building blocks into something new. Factories become loft apartments. Industrial waterfronts become public parks. Warehouses become start-up offices and restaurant scenes.

The pandemic forced American cities to make such transformations, temporarily. They turned sidewalks into restaurants, parks into hospitals, streets into open spaces. Now on a lasting and larger scale, they will need to convert offices into apartments, hotels into affordable housing, curb parking into bike lanes, roadways into transit routes, office parks into real neighborhoods.

“If these last few years have taught us anything,” said Ingrid Gould Ellen, a professor of urban policy and planning at N.Y.U., “it’s the need for flexibility, the need to be open to surprise in the way we’re going to use space.”

But over decades, that flexibility has eroded.

For the full commentary, see:

Emily Badger. “When Offices Ought to Be Apartments.” The New York Times (Tuesday, July 4, 2023): A1 & A13.

(Note: ellipsis added.)

(Note: the online version of the commentary was updated July 4, 2023, and has the title “American Cities Have a Conversion Problem, and It’s Not Just Offices.” The online version says that the title of the print version was “How Cities Are Getting In Own Way.” The title of my national edition of the print version had the title “When Offices Ought to Be Apartments.”)

Socialist Alexandria Ocasio-Cortez (AOC) Rallied with Poor Hispanic Entrepreneurs Who Were Shut Down by Government Regulators

(p. A21) Until last week, Corona Plaza in Queens was bustling: taqueros flipping fresh tortillas and vendors hawking Central American crafts over a soundtrack of cumbia and train traffic. There were produce stands, live bands and surging crowds, all in a public square that was named one of the 100 best places to eat in the city.

But last Thursday [Aug. 3, 2023] and Friday [Aug. 4, 2023], sanitation workers swept through the plaza, removing several stalls and threatening to penalize vendors who did not have a city permit to operate — nearly all of the more than 80 who regularly work there. In the days since, the grilled-meat stands and jugs of agua fresca have been replaced with protest signs.

It was the latest escalation in the city’s tense relationship with the plaza merchants — most of them immigrant women, many of them undocumented — who have helped revive one of the New York neighborhoods hit hardest by the coronavirus pandemic.

. . .

The City Council passed a law in 2021 mandating the release of another 445 food vendor permits every year for a decade, but the rollout has been slow.

There are 10,195 food vendors on the waiting list, according to a spokeswoman for the Department of Health and Mental Hygiene, which manages the applications. The agency has issued just 104 of the new licenses so far, and only four of the recipients have completed all the steps needed to sell food legally.

Ms. Calle is one of the few vendors at the plaza who has a permit — but only because she rents it from a third party for $16,000 a year, a prohibited but widespread practice.

Even so, Ms. Calle decided to close her stall this week, in solidarity with her neighbors.

“I know how hard it is” for new vendors, she said in Spanish, recounting how she had been arrested four times in 23 years for various permitting violations.

While few merchants at the plaza own the hard-to-obtain permits, most of them, including Ms. Calle, pay taxes on sales, and hold a license that certifies they have taken a food safety course.

At the rally at the plaza on Wednesday [Aug. 2, 2023], the dispersed merchants were joined by elected officials including Representative Alexandria Ocasio-Cortez and Donovan Richards, the Queens borough president, . . .

. . .

Nearly 4,000 people, most of them locals, have signed a petition in support of the vendors.

The plaza, once an underused service road near 103rd Street and Roosevelt Avenue, was redesigned in 2012 as a public square.

When the pandemic hit the surrounding neighborhood of Corona — harder than almost anywhere else in the United States — the plaza became an economic and cultural hub for recovering workers, said Carina Kaufman-Gutierrez, the deputy director of the Street Vendor Project.

For the full story, see:

Stefanos Chen and Raúl Vilchis. “Their Food Is Hailed; They Want the Right to Sell It.” The New York Times, First Section (Sunday, August 6, 2023): A21.

(Note: ellipses, and bracketed dates, added.)

(Note: the online version of the story has the date Aug. 5, 2023, and has the title “They Make Some of New York’s Best Food. They Want the Right to Sell It.” Where there are minor differences in wording between the print and online versions, the passages quoted above make use of the online wording.)

“Proud Symbol of Britain’s Welfare State” in “Deepest Crisis of Its History”

(p. A1) As it turns 75 this month, the N.H.S., a proud symbol of Britain’s welfare state, is in the deepest crisis of its history: flooded by aging, enfeebled patients; starved of investment in equipment and facilities; and understaffed by doctors and nurses, many of whom are so burned out that they are either (p. A6) joining strikes or leaving for jobs abroad.

Interviews over three months with doctors, nurses, patients, hospital administrators and medical analysts depict a system so profoundly troubled that some experts warn that the health service is at risk of collapse.

. . .

(p. A6) More than 7.4 million people in England are waiting for medical procedures, everything from hip replacements to cancer surgery. That is up from 4.1 million before the coronavirus pandemic began in 2020.

Mortality data, exacerbated by long wait times, paints a bleak picture. In 2022, the number of excess deaths rose to one of the highest levels in the last 50 years, and those numbers have kept rising, even as the pandemic has ebbed.

In the first quarter of 2023, more than half of excess deaths — that is, deaths above the five-year average mortality rate, before the pandemic — were caused by something other than Covid-19. Cardiovascular-related fatalities, which can be linked to delays in treatment, were up particularly sharply, according to Stuart McDonald, an expert on mortality data at LCP, a London-based pension and investment advisory firm.

For the full story, see:

Mark Landler. “After 75 Years, Health Service In U.K. Teeters.” The New York Times (Monday, July 17, 2023): A1 & A6-A7.

(Note: ellipsis added.)

(Note: the online version of the story has the date July 16, 2023, and has the title “A National Treasure, Tarnished: Can Britain Fix Its Health Service?”)

Perverse Medicare Pricing Incentives Drive Hospital Consolidation Inefficiency

(p. A17) Currently, Medicare pays hospital-owned facilities two to three times as much as independent physician offices for the same service, according to the Alliance for Site Neutral Payment Reform. This creates an enormous incentive for large hospital chains to acquire outpatient practices. Consolidation creates a vicious circle in which larger hospital systems can demand ever higher rates from insurers and also have the capital to buy up physician practices. Removing this perverse incentive will ensure that patients have access to trusted doctors and appropriate care at the same price regardless of treatment location and remove artificial pressure to consolidate.

These bipartisan reforms would deliver hundreds of billions in savings for families. Site-neutral payments would save taxpayers more than $153 billion in Medicare spending over the next decade and also substantially reduce premiums and cost-sharing for Medicare beneficiaries by $94 billion, according to CRFB. In total, these changes could save patients and taxpayers between $346 billion and $672 billion over the next decade.

Large hospital systems have exploited our nation’s outdated billing systems to foist gigantic bills on Americans. Bringing much-needed transparency in hospital billing will deliver more affordable care and put patients back in control.

For the full commentary, see:

Bobby Jindal and Charlie Katebi. “Doctor’s Office Care at Hospital Prices.” The Wall Street Journal (Thursday, July 27, 2023): A17.

(Note: the online version of the commentary has the date July 26, 2023, and has the same title as the print version.)