Climate 411

One year later: What’s next for the bipartisan infrastructure law’s historic investments in new climate tech?

A year ago, President Biden signed the bipartisan Infrastructure Investment and Jobs Act into law, the largest investment in infrastructure since the New Deal.

Among the many key climate investments included, the infrastructure law put a long-awaited down payment on several new and promising climate solutions including carbon dioxide removal, hydrogen, long-term energy storage and technologies to support clean industry.

We spoke with Natasha Vidangos, Senior Director for Climate Innovation and Technology at Environmental Defense Fund, about what’s next for these investments and how they can help us tackle the climate crisis.

Read More »

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

COP 27: The 3 issues we’re watching as the world gathers in Sharm El-Sheikh

Co-authored by Angela Churie Kallhauge, Executive Vice President, Impact; Maggie Ferrato, Manager, Global Climate; and Julia Ilhardt, High Meadows Fellow 

It’s been a year since countries and companies announced new climate pledges in Glasgow. 

Since then, war and economic disruption, on top of a still-raging pandemic and increasingly destructive natural disasters, have complicated those commitments – and arguably made them even more urgent. The latest report from the Intergovernmental Panel on Climate Change underscores that we have very little time left to meet even the upper limit of the Paris Agreement’s temperature goals. 

COP27 is expected to be a “working COP,” meaning we’re likely to see incremental progress on key issues rather than major announcements. But that doesn’t make it any less important. This COP is a chance for countries to take meaningful steps toward tackling the climate crisis.  

Here are the three issues to watch in Egypt both in the negotiations and on the sidelines to ensure we implement our existing commitments while raising our ambition.   Read More »

Also posted in Carbon Markets, Greenhouse Gas Emissions, Paris Agreement, United Nations / Tagged | Comments are closed

Widespread support for the SEC’s proposed climate risk disclosure standards

Photo by Jose Saenz

(This post was co-authored by EDF’s Director of Investor Influence Andrew Howell)

A proposal from the Securities and Exchange Commission (SEC) that would standardize public companies’ disclosures of climate risk information is getting strong support from the general public, investors, companies of various sizes across a wide range of sectors, law and business scholars, public officials, climate scientists, and environmental advocates – including EDF.

We joined the Institute for Policy Integrity at NYU School of Law to submit letters supporting the proposed standards. Our letters focus on three reasons why the SEC is on strong legal footing:

Adoption of the proposed rule would replace today’s inconsistent, vague reporting of climate risk exposure with comparable, specific information to strengthen investor and corporate climate risk management.

Here’s what other experts and stakeholders are saying about why they support the standards:

Read More »

Posted in News / Comments are closed

As Washington state sets the rules for its ambitious climate program, regulators shouldn’t overlook this policy tool

This post was co-authored by Natalie Hurd, Western states climate policy intern at EDF.

Landscape of Washington state

Photo Credit: George Dodd for Getty Images

Washington state is on the cusp of finalizing the rules to launch its ambitious new climate policy. This comes at an important moment of opportunity for states to lean into their climate commitments and increase their ambition. The passage of the Inflation Reduction Act will drive an unprecedented level of investment in fighting climate change and building a clean energy future, making it even easier for states like Washington to meet their climate goals. By enacting ambitious cap-and-invest legislation last year, Washington has taken an important step forward — but now it’s up to regulators to deliver the strongest possible cap-and-invest program.

The Climate Commitment Act (CCA) pairs carbon emission reductions with new tools to tackle local air quality disparities — all in the same policy framework. One of the valuable tools included in the cap-and-invest legislation is an emissions containment reserve (ECR) — a mechanism that guards against long-term uncertainty by ensuring that the program will be made more ambitious if prices for the program become lower than expected. Right now, Washington’s Department of Ecology is making decisions about the details of how to implement the program, including whether or not to include a functional ECR, and EDF has made it clear that Washington should include a well-designed, effective ECR in the state’s cap-and-invest program. Regulators once again have the opportunity to lead the way on the West Coast by including a functioning ECR in Washington’s program design.

What is an emissions containment reserve?

An ECR is a design feature for cap-and-invest programs that was first implemented by the Regional Greenhouse Gas Initiative (RGGI), a multi-state climate program on the East Coast. The primary role of an ECR is to ensure that, when demand for emissions allowances decreases, the overall supply of allowances is reduced. By reducing the supply, the ECR reduces the overall amount of climate pollution allowed under the program. In other words, allowances are reserved from the market and unable to be purchased, to make sure that the overall allowance budget is adjusted so that emissions are further contained. The amount of allowances that can be removed from the supply and placed in the ECR is relatively small ー for example, in RGGI, the size of the ECR is up to 10% of the allowance budget of participating states.

A figure describing how an ECR functions

Figure 1: Overview of an ECR (Adapted from Resources for the Future)

An ECR is activated when the allowance price hits a “trigger price”, which is a set price that would reflect lower-than-expected demand for allowances. In an auction, if demand for allowances is relatively low, the price of allowances at auction will decrease. If the price of allowances decreases enough to reach the ECR’s trigger price, then a predetermined number of allowances will be removed from the overall allowance supply available at the auction. By reducing the supply of allowances when the trigger price is reached, an ECR translates lower demand and lower prices into greater climate ambition.

One reason why demand for emissions allowances and allowance prices might drop, thus requiring the intervention of an ECR, is if regulated entities are able to cut emissions more quickly than expected.. For example, if a policy like a Clean Fuels Standard reduced emissions more swiftly than anticipated, then the entities impacted by that policy would have lower emissions and therefore require fewer emissions allowances than expected. An ECR helps create a supply for emissions allowances that is responsive to how demand for emissions allowances changes over time.

What does Washington’s program currently do?

Despite the added stability and climate ambition that an ECR would bring to Washington’s cap-and-invest program, as imagined in the Climate Commitment Act, the current proposed design for Washington’s program is missing a critical ingredient: an ECR trigger price. Without a trigger price, there is no way for the ECR to be activated, meaning that Washington’s proposed program does not include a functional ECR.

Why should Washington include a functional ECR in their program?

Economic modeling has shown that including an ECR in an emissions market improves performance by making the market more efficient and securing additional emissions reductions. On top of these benefits, an ECR would help ensure that a program like Washington’s will keep running smoothly long-term. For one, the inclusion of a functional ECR can reduce price volatility in the long run, which decreases uncertainty for market participants. Stable market expectations are important to the durability of the program. Cap-and-invest in the state is more likely to be successful going forward if market participants can better anticipate market behavior year-to-year and plan accordingly. In addition, an ECR provides a predictable, rule-based approach for supply adjustments, helping to avoid the need for other less predictable adjustments to supply by the Department of Ecology to keep Washington on track to meet its climate goals.

Finally, an ECR can increase the environmental ambition of the program by reducing the overall supply of allowances if demand for allowances falls, thereby reducing the total climate pollution that can be emitted by regulated entities. This is critical because Washington’s cap-and-invest program serves as a backstop, working alongside a suite of programs and investments that will help drive emissions reductions. As these programs and investments interact, it’s essential that the cap-and-invest program’s overall limit on emissions remains ambitious enough to incentivize continued efforts to address climate change, and an ECR can help do this by reducing the supply of allowances when demand for allowances is low.

Implications for linking with other carbon markets

In addition to enhanced environmental integrity and economic stability, a functional ECR with a trigger price may be an important factor in potential future program linkage between Washington and other carbon markets. Program linkage — or connecting carbon pricing systems across borders — can facilitate quicker reductions in emissions regionally. By establishing an ECR, Washington would set an important precedent for other states, as well as provide a strong example of climate policy. The ECR program design has already spread from its initial inception in RGGI, and Washington now has an opportunity to be a leader for states on the West Coast.

Market-based mechanisms to reduce climate emissions are not the only policies that need to be implemented to address the climate crisis, but they are a critical part of a suite of climate solutions, including sectoral strategies to deliver near-term reductions in climate pollution. In addition to maintaining the strength of its cap-and-invest system, it’s crucial that policymakers in Washington and elsewhere work meaningfully with communities to ensure that these policies are designed and rolled out in an equitable and just way, explicitly addressing the disproportionate burden of pollution that is primarily borne by low-income communities and communities of color. While cap-and-invest programs are only part of the solution, making them as strong and as stable as possible — such as with the implementation of an effective ECR with a trigger price — will help facilitate more ambitious and broad climate action for decades to come.

During the comment period for Ecology’s latest CCA rulemaking, EDF made it clear that Ecology should include a functional ECR with a trigger price in the final rules. Including a trigger price would help the program’s ECR function properly while driving greater reductions in climate pollution when prices are low. By building a strong ECR into its cap-and-invest program, Washington can continue to lead the way with effective, ambitious climate action that’s a model for other carbon markets.

Also posted in Carbon Markets, Cities and states, Climate Change Legislation, Economics, Energy / Comments are closed

EDF’s new calculator shows the dire impact of methane pollution

It’s been a brutal summer here in Texas. Parts of the state suffered through weeks of temperatures topping 100 degrees, and rarely dipping below 80 at night. It’s a strain on our power grid, agriculture and – most of all – people.

It’s not just Texas of course. Excessive heat and severe flooding has claimed thousands of lives across Europe, Asia, and Africa. The increasingly destructive heat, fires, hurricanes and droughts are all connected to climate pollution, including methane emissions.

But how much warming, exactly, is methane contributing? It is tricky to quantify because this potent gas has a short lifetime. The EPA has a good tool to calculate the climate impact of various greenhouse gases, including methane, but it only shows the impact over a long-term timeframe — 100 years — and that can downplay methane’s near-term warming power.

The Biden administration’s move to reinstate and strengthen methane emission rules, coupled with the Global Methane Pledge from COP26, put methane in the spotlight. But many remain unaware of its potency, and the potential benefits we could achieve by cutting methane emissions. If we don’t recognize the extent of the methane problem, we could miss a crucial opportunity to avert the worst heat waves and other climate disasters in the future.

That’s why EDF has developed a new calculator that converts abstract greenhouse gas emission numbers into equivalent activities from our daily lives to make the data more meaningful.

Translating methane leaks into everyday activities

Our calculator shows how different species of greenhouse gases warm the planet, because those individual impacts could vary dramatically over time. While we know that all greenhouse gases behave differently, scientists have historically measured them with the same rubric —comparing them to long-lived carbon dioxide over a 100-year timeframe. This metric — while simple to apply — obscures the much more powerful, but shorter-lasting, effects of some other greenhouse gases like methane.

Our new tool translates emissions into everyday activities, like driving cars, consuming beef, or charging smart phones. It also allows users to see the impacts of these emissions from the year they are released to 100 years in the future.

 

A look at our new calculator. Click the image to input your own data.

 

Our calculator shows how short-lived greenhouse gases like methane generate a lot of warming in the near-term, but their impact relative to carbon dioxide decreases as the decades wear on. This provides a fuller picture that reflects the nuances of short-lived gases. It also means that cutting emissions of short-lived gases can quickly slow down warming. Research shows that cutting methane from oil and gas operations, agriculture and other sources as much and as fast as possible could slow the rate of warming by a whopping 30% in the next two decades.

Taking action can have immediate impacts

Understanding the critical differences between short and long-lived gases can help us develop policies that will have profound impacts – both in the long-run and more immediately. This insight has led the U.S., Europe and countries around the world to focus on methane emissions

We have a variety of solutions at the ready. Limiting methane leakage from oil and gas development, for example, will both minimize pollution and save product. It’s affordable and immediately impactful.

According to the Intergovernmental Panel on Climate Change (IPCC), anywhere from 50 to 80% of methane emissions from oil and gas could be eliminated at a relatively low cost with technologies and practices that already exist.

We’re already experiencing dramatic impacts from warming in the form of stronger storms, more intense heat waves, and larger, more destructive wildfires. If we really want to see improvement, both today and for future generations, we need to act now on gases like methane.

Posted in News / Comments are closed

With one week to act, California needs to pass these policies to drive climate progress and protect communities

This post was co-authored by Caroline Jones, Analyst for U.S. Climate

photo of a wind farm in a western landscape

Photo Credit: Pixabay

The heat is on in Sacramento.

With less than a week left in the California State Legislature’s session (which ends on August 31), a set of potentially game-changing climate policies are on the table. Earlier this month, Governor Newsom released a series of proposals for the legislature, including a more ambitious goal for cutting climate pollution by 2030, codifying a carbon neutrality goal, interim clean electricity targets, safeguards from the health impacts caused by oil and gas drilling and providing direction on the use of carbon capture and sequestration — all of which are now being negotiated in Sacramento.

This push arrives amid a grueling year for climate change-fueled impacts across the state, with wildfires, heat waves and the worst megadrought the West has seen in over 1,000 years all underscoring the urgency for bold action. And with the new, massive down payment on climate and clean energy through the Inflation Reduction Act, California will have even more tools and investments available to drive down climate pollution further and faster.

Here are the key policies that can drive meaningful climate progress and protect communities — and need to pass the finish line by the end of the session.

Read More »

Also posted in California, Cities and states, Policy / Read 1 Response