Distributional Consequences of Natural Gas Decontrol. Appendix D to a Study of Alternatives to the Natural Gas Policy Act of 1978

摘要

This appendix supplements the discussion of the distribution of the costs and benefits of decontrol that appears in A Study of Alternatives to the Natural Gas Policy Act of 1978. It provides detailed estimates of the effect each of three decontrol policies would have on the gas expenditures of families living in houses heated with gas, the method used to estimate the expenditures, and the method used to estimate changes in producer income. Two key findings of the study of alternatives to the NGPA are that current policies have hidden costs and that on balance the benefits of both phased and full decontrol exceed the costs. These findings are discussed in the study itself and in other appendices to the study. This appendix covers only two aspects of the full array of costs and benefits-increased gas costs to households and increased producer income. The three policies considered in the discussion of the gas expenditures of households are current policies, full decontrol in 1982, and a phased decontrol policy, called the New-New policy. The discussion is in six sections. Section II describes the effect full decontrol would have on the gas expenditures of households that heat with gas. Section III provides a similar analysis of the effects of the New-New phased decontrol option. Section IV describes the method used to estimate residential gas bills of households in several economic and demographic groups. Section V describes the method used to estimate the amount of low income energy assistance that would be available to low income families that live in houses heated with gas. Section VI discusses the method used to compare the costs of heating with fuel oil, electricity, and natural gas. Section VII describes the method used to estimate the changes in the taxes and after-tax income of producers and royalty owners reported in the study of alternatives to the NGPA. (ERA citation 07:017375)