Climate 411

A Cap on Carbon is a Private Sector Stimulus Bill

About one million new jobs in the clean energy field have been created by the American Recovery and Reinvestment Act, better known as the stimulus bill. That’s according the latest report from the Council of Economic Advisers.

That’s good news for the clean energy economy, and for those Americans who are looking for work. But we can’t rely on tax dollars to finance growth indefinitely. The stimulus bill is a jump start, not a long-term fix.

We need to harness the power of private sector investment if we hope to see long-term growth and job creation. And the best way to do that is through a clean energy bill with a limit on carbon pollution.

That’s what EDF’s president Fred Krupp says in today’s column by New York Times writer Tom Friedman:

As Fred Krupp, the president of Environmental Defense Fund, notes: U.S. utility companies today “are sitting on billions of dollars in job-creating capital — but they will not invest in new energy projects until they have certainty on what their future carbon obligations will be. In just one state, Indiana, there are 25 power plants 50 years old or older. The fleet needs to be modernized, and Senate paralysis is keeping it from happening. A recent study from the Peterson Institute projects annual investment in the sector in the next 10 years would rise by 50 percent as a result of climate legislation — an increase of nearly $11 billion a year.”

That’s new employment from a private sector stimulus.

Political analyst Joe Lockhart is saying almost the same thing. Lockhart is quoted in the Atlantic’s blog in a piece, Cap-and-Trade: The Next Best Stimulus?

We’re rapidly approaching the end-date of our near-term economic solutions – and it’s not clear that we have a policy to get private dollars moving again once those solutions end. That makes movement on a utility-first cap on carbon emissions essential.

The bottom line: If we pass a climate and clean energy bill with a carbon cap, we’ll create jobs without increasing deficit spending.

Also posted in Greenhouse Gas Emissions, News / Comments are closed

From the blogosphere: new green jobs, a proposal on low carbon fuel standards, and VoteVets supports clean energy legislation

Treehugger and CleanTechnica both wrote on the new Council on Economic Advisors report finding that nearly 1 million new jobs were created by the stimulus bill, and “one of the areas where Recovery Act funds are stimulating the most private investment is the clean energy sector.”

In response to reports that senators are considering adding a low carbon fuel standard (LCFS) into the pending climate and energy bill, Michael Levi blogged about what impact this might have on the legislation, potential obstacles and opportunities. While he lauds the goal of reducing emissions, he recommends adding a price ceiling on the tradable permits refiners, blenders, and importers would be required to hold.

Grist posted the new ad from VoteVets, in which Brigadier Gen. Steven Anderson, “who served under Gen. David Petraeus in Iraq, calls clean energy legislation not only a military priority, but an American mission.”

Also posted in Cars and Pollution, Climate Change Legislation, News, Policy / Comments are closed

The Evidence Continues to Pile Up: Climate Legislation is Affordable. The Time to Cap Carbon is Now.

As the debate on climate legislation gears up in the Senate, evidence continues to accumulate that a climate bill will be affordable and provide a much-needed boost to our economy.

A new analysis released by the Department of Energy’s Energy Information Administration (EIA) of the comprehensive climate and energy legislation introduced by Senators Kerry and Lieberman (the American Power Act or APA), confirmed that under the bill, the American economy would continue to grow robustly, and the cost to households would be minimal.  Here are the facts:

  • Under climate policy, U.S. GDP would grow by a third over the period 2008-2020, and would nearly double by 2035. A “business as usual” scenario with no climate policy would add only a tiny fraction to output — just two-tenths of a percent (0.2%) in total over the next two decades.  To put this in perspective, GDP is projected to reach $27.8 trillion by New Year’s Day 2035 under business as usual; under climate policy, it will get there by the middle of February.
  • Under climate policy, U.S. employment is projected to grow 8% by 2020 and 22% by 2035, relative to 2008.
  • The estimated cost to the average American household is $167 in the year 2020 (in 2009 dollars) – less than six dollars a month per person.  (The EIA also reports an annualized figure of $206 over the entire period.)
  • Estimated electricity prices would be only 4% higher in 2020 under the policy than they would be without it.
  • Allowance prices in 2020 and 2030 are even lower than EIA projected under the House-passed climate legislation (HR2454).

The EIA’s analysis also points out that the vast majority of reductions would come from the electric power sector.  That’s relevant to current debates, as the Senate is currently considering a scaled-down version of the cap included in APA that would only cover the power sector.  Under such a policy, allowance prices would be lower — making household costs and other economic impacts even smaller.

All of EIA’s projections are consistent with an array of estimates from the most credible analyses available, in particular, the Environmental Protection Agency (EPA) and the Congressional Budget Office (CBO).  EPA’s estimates for the cost to the average American household are comparable to EIA’s (amounting to just a few dollars a month for the average individual American).  And just last week, CBO reported that APA would reduce future deficits by approximately $19 billion over the next decade.  It also estimated even lower allowance prices under APA than under HR2454, which CBO also projected would cost the average American just a few dollars a month by the year 2020.

That is a small investment in a clean energy economy that will create jobs, reduce pollution and increase America’s energy security.  And it’s always important to remember that all of these analyses only look at one side of the ledger – they do not take into account the huge costs of inaction on climate change.

Studies like those from EIA, EPA, and CBO confirm that we can readily afford a comprehensive climate and energy bill that would boost our economy, reduce our dependence on imported oil and help avert dangerous climate change.  There is no more time to waste – the Senate needs to pass a cap on carbon now.

Also posted in Climate Change Legislation, News, Policy / Comments are closed

Five Denier Myths about the Climate & Energy Bill

Originally appeared on Huffington Post

Like the summer weather outside, the fight over a strong climate bill is heating up. The next three weeks will reveal which Senators are serious about fixing the world’s biggest crisis, and which are worried about short-term political advantage.

At stake is whether the Senate will consider a strong bill that caps America’s carbon pollution and ends our over-dependence on oil and other fossil fuels. Or whether the Senate will pass yet another energy-only bill that won’t solve the problem.

Predictably, the “No Can Do” climate action naysayers continue to oppose to setting hard limits on America’s climate pollution. And they’re trotting out the same worn-out old arguments they’ve been using to oppose action for the last decade.

As we approach the Senate endgame, we want to use this opportunity to respond forcefully and directly to these scare tactics. Here are five reasons climate action opponents are wrong:

1) They claim a strong cap on America’s carbon pollution will wreck our economy.

FALSE: This is the bogeyman of every effort over the last century to protect our environment and defend public health and safety. Power companies said limits on acid rain pollution would wreck the economy. Oil refineries said taking lead out of gasoline would wreck the economy. Car manufacturers said installing seat belts would, you guessed it, wreck the economy. History has shown that in every case, America’s economy has not only survived but thrived under tougher environmental and public health and safety standards.

On this one, our opponents aren’t just wrong. They’re dead wrong. A cap on carbon didn’t cause the current economic disaster. A cap on carbon didn’t lead to one billion dollars a day going overseas to oil exporters. A cap on carbon didn’t raise electricity rates for the average American home 42% or increase the average cost for a gallon of regular gasoline 138% over the last 20 years. A cap on carbon didn’t slash American manufacturing jobs over the last half century.

It’s the status quo that got us into this mess.  The best way out is to jumpstart the new green economy by ending our addiction to oil and other fossil fuels with a strong limit on carbon pollution.

2) They claim a strong cap on America’s carbon pollution will undermine our economic recovery.

FALSE: They’ve got it backwards. Many notable economists, including Nobel Prize-winning New York Times columnist Paul Krugman and White House Economic Council Director Larry Summers, argue that strong climate action is the key for promoting economic recovery. It will encourage economic and entrepreneurial innovation and finally clarify how America will proceed with carbon limits. Without strong legislation, the uncertainty of EPA regulation and the threat of litigation will continue to freeze much-needed investments to modernize our energy infrastructure.

If you don’t believe these economists, remember this: even if we pass a strong cap on carbon pollution this year, it won’t go into effect for a couple years. That’s how long it will take before the regulatory rules are written. This is one of the most compelling reasons for passing a bill now so we can set the regulations and begin cutting emissions in time to meet the 2020 limits.

We should also note that most short-term emission cuts will come from the “low hanging fruit” of promoting energy efficiency and investing in carbon offsets. Indeed, the House-passed climate and energy bill earned the support of a wide range of businesses, including several power companies, because it made environmental and economic sense.

3) They claim that America can transition to a cleaner energy future without limiting carbon pollution simply by passing an energy-only bill.

FALSE: This is the popular, easy-out position for politicians — just throw money at the problem. But, there are several major flaws with an energy-only bill.

Congress has passed 10 energy bills over the last 40 years, and none of them have even come close to launching the energy revolution we need to end our over-dependence on fossil fuels and transform our energy economy.

The math simply doesn’t add up. Unleashing our clean energy future will require trillions of dollars in new investment in our energy infrastructure and technologies over many years. Such a large-scale transition will only be possible when private investors are given a clear market signal that the days of treating our atmosphere like an open sewer for unlimited carbon pollution are over. Without a strong cap on carbon pollution, we will remain addicted to the dirty energy of the past.

Finally, those in favor of promoting clean energy technologies without a carbon cap typically support taxpayer investments in handpicked energy technologies and programs. There are two main problems with this approach:

1) There is no way we can subsidize our way out of this problem — we are already running huge deficits, but even if we could find billions of dollars in taxpayer funds for clean energy subsidies, it will not come close to transforming our energy economy; and

2) This is a top-down, command-and-control, federal-government-picks-winners-and-losers approach that many legislators object to, and it will fail to achieve the most efficient clean energy investments.  A carbon cap will unleash the ingenuity of America’s entrepreneurs, and they will find the most cost-effective technologies for reducing global warming pollution.

4) They claim this is nothing but an energy tax that will limit freedom in America.

FALSE: A cap on carbon is a pollution limit, not a tax. It is a proven way to ratchet down pollution in a cost-effective, efficient, sensible way. As pollution levels decline and we begin to end our addiction to fossil fuels, new, cleaner, more efficient technologies will fill the void.

Think of it this way — let’s say you’re a smoker. One way to help you end your tobacco addiction would be to tax cigarettes and increase the cost of smoking. If smoking cigarettes gets more expensive, you may smoke less. Then again, you may just pay the extra amount and find other ways to save money. This is how a carbon tax would work, and it’s not what we’re advocating.

A better way to ensure that you stop smoking would be to set a declining limit on number of cigarettes you can smoke each day so that over time you gradually kick the habit. This is how a cap on carbon would work.

As for limiting freedom in America, this may be a popular claim by Rush Limbaugh, Glenn Beck, and the Tea Party crowd. But this flips the issue on its head.

Right now, we import nearly 60% of our oil and are beholden to the whims of the petro-dictators. We sit on only about 2% of the world’s proven oil reserves, but we consume nearly 20% of the world’s oil. Drill Baby Drill won’t change the basic math in this equation.

What freedom-loving American would choose to be dependent on Middle Eastern oil or while relying on the finite and dwindling resources of the world’s fossil fuels?

5) They claim that the environmental threat from climate change is overstated.

FALSE!: This one needs an exclamation point. The National Academy of Sciences and the science advisors to the last four presidents of both parties have looked at the data and are unequivocal in their warnings that global climate change is a potentially catastrophic environmental threat to the planet.

The next time someone questions the science of global warming, ask whether he denies that carbon dioxide is a heat-trapping gas. Or whether she denies we are emitting billions of tons of it into our atmosphere every year. Or whether atmospheric concentrations of carbon dioxide are higher today than at any time in at least the last 2.1 million years. Or that we just completed the warmest decade on record and that 2010 is on pace to shatter the record as the warmest year.

Each of these facts are measurable, verifiable, and not in dispute.

As a result of our 100 years of unlimited carbon pollution, we are witnessing the first symptoms of a planet that is transforming before our eyes. And what we have already seen should be enough to demand action.  Polar sea ice melting at alarming rates, seasons coming earlier, migration patterns shifting, the oceans acidifying, corals bleaching, glaciers retreating, wildfires raging out of control, mega-floods and severe droughts – these early symptoms are becoming the norm.

And this is merely the opening act. Over the coming decades, the planet will get warmer and warmer and warmer. Without a strong cap on carbon, there is no reversing this devastating trend.

On these and many other claims, the “No Can Do” folks are just plain wrong. The time for a strong climate and energy action is now. Please email your Senators today and urge them to support the strongest possible bill.

Also posted in Climate Change Legislation, Jobs / Read 3 Responses

July 6th, 2010 – The voices of a new clean energy future

Kansas City StarGrowing Green Jobs: A Conversation with Mark Izeman

Greening the economy – and creating new green jobs – is absolutely critical to successfully tacking climate change and many other global environmental crises we face. And these new jobs can at the same time jumpstart our economy and address our distressing unemployment rates around the country, especially in low-income communities. So, hopefully in 40 years, green jobs will be such an integral part of our economy that we won’t even need to label such jobs as “green.”

Indianapolis Star – Seize the moment to embrace clean energy

By Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development.

At HUD, we recognize that homes are responsible for 20 percent of America’s carbon emissions, and that the long distances families have to drive to get to work and schools contributes to our dangerous dependence on oil. That’s why we’re coordinating with the Department of Transportation and the Environmental Protection Agency to reduce our carbon footprint at the same time we connect where we live to where we work.

The Huffington Post– “July 4th: Hope and Freedom in America”

By Representative Earl Blumenauer, D-Oregon

While we have not yet achieved freedom from our addiction to oil, the dramatic BP spill in the Gulf coupled with unprecedented investments in conservation and alternative energy make it more likely that we have a sustainable path for the future.

The House passed historic legislation to combat global warming and survey after survey show a majority of Americans still support comprehensive climate legislation. We all still have hope for the Senate.

The Voices of a New Clean Energy Future is a series from individuals who understand the importance of passing comprehensive climate and clean energy legislation – business leaders, politicians, policy experts, and concerned citizens like you. EDF is proud to highlight their voices and contributions to the climate and energy debate.

Also posted in Climate Change Legislation, Jobs, News / Comments are closed

July 1st, 2010 – The voices of a new clean energy future

The Huffington Post“A Knockout Blow to Gulf Production”

By Jeffrey Rubin, economist

“If raining oil on New Orleans doesn’t curb America’s appetite for crude, the resulting price shocks may.”

“The environmental consequences of Deepwater Horizon will take millions of barrels of oil out of future production. But the hurricane season threatens to rob us of even today’s production. Between the two of them, America will no doubt be looking elsewhere to meet its energy needs.”

The Huffington Post“Stuck on Stupid: Big Oil Says NO to Green Jobs”

By Robert Greenwald, Filmmaker, Brave New Films

“We’re trapped in a destructive cycle of cleaning up after Big Oil, and this cycle is hurting our environment and our economy. It’s time we break free and demand Clean Energy and Green Jobs Now!”

 “America has led in innovation before. We went from horse and buggy to the automobile. We went from the telegraph to the telephone. And now we must lead in transitioning from oil addiction to a clean energy economy. The solution to our destructive addiction to oil is clean energy, and Congress must show true leadership in creating it.”

The Voices of a New Clean Energy Future is a series from individuals who understand the importance of passing comprehensive climate and clean energy legislation – business leaders, politicians, policy experts, and concerned citizens like you. EDF is proud to highlight their voices and contributions to the climate and energy debate.

Also posted in Climate Change Legislation, News, Policy / Read 2 Responses