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Goldman Sees Cheaper Energy From Border Tax But Not in U.S.

  • Global coal and gas prices will fall because of dollar’s rise
  • U.S. LNG exporters would make deals to maximize tax benefit
Vapour rises from cooling towers as the sun sets on behind Drax Power Station, operated by Drax Group Plc, in Selby, U.K., on Tuesday, March 11, 2014. Drax Group Plc, the operator of the U.K.'s biggest coal-fired power station, reported a 23 percent slump in full-year profit as carbon prices rose and it prepared to convert two more units to burn cleaner fuel.
Photographer: Chris Ratcliffe/Bloomberg
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A proposed U.S. border-adjustment tax would make fuels that provide half the world’s energy cheaper -- for everyone except Americans.

That’s the conclusion of Goldman Sachs analysts including Damien Courvalin. A tax like the one being discussed in the U.S. Congress would cause the dollar to appreciate, driving down the price of coal and liquefied natural gas, which are priced globally in the U.S. currency, they said in a Feb. 9 report.