Climate 411

The Silver Bullet Of Climate Change Policy

By Gernot Wagner / Published: January 24, 2014

(This post originally appeared on Forbes)

By Bob Litterman and Gernot Wagner

Whenever the conversation turns to climate change, someone is sure to opine that there’s no silver bullet. The issue is simply too complex to have one solution. When you focus on all the changes that need to occur to reduce greenhouse gas emissions globally it seems like a multifaceted approach is the only way forward.

Most of the world’s vexing problems share that feature. Mideast peace, nuclear non-proliferation, Eurozone stability, and plenty of other national security problems have no single right plan of attack. Some past plans might have brought us tantalizingly close to a seeming solution, but then reality started interfering once again, reconfirming the complexity of it all.

Climate change must surely be in that category. No single country, no single technology, no single approach can seemingly solve this one for us once and for all. Picking a single technology will almost inevitably end in some form of disappointment. Bureaucrats, the saying goes, ought not to try to pick winners. Leave that to venture capitalists for whom failure is a way of life. For every Apple and Facebook, there are dozens who never make it out of the garage. And clean technology doesn’t yet even have a single Apple and Facebook as the standout approach revolutionizing the field.

Source: NYU

It turns out, though, that how you frame the issue is crucial. If you think like an engineer there are dozens of challenges. If you think like an economist, there is one. It’s guiding the ‘invisible hand’. How can you create the appropriate incentive to decrease the pollution that’s causing climate change? For that, the government need not be in the business of picking winners at all. What it should—and can—do is identify the loser that’s been clear for decades: greenhouse gas pollution. And the solution is equally clear: create incentives to reduce emissions by pricing it. If we make this one change, most other actions that are needed will follow.

That’s what the European Union has done by capping carbon emissions from its energy sector, including large industrials, covering almost half of total carbon emissions. That’s what California is doing with over 80 percent of its total global warming emissions. It’s what China is experimenting with in seven city and regional trials, including in Beijing and Shanghai. All these systems put a price on greenhouse gas pollution.

On the other side of the ledger, there are still much larger incentives to consume fossil fuels in many other countries. The International Energy Agency estimates that global subsidies are well over $500 billion. These subsidies, which incentivize emissions, sadly dwarf the paltry incentives to reduce them. Free marketeers, small government advocates, and others who dislike distorting government subsidies should be appalled at the tax money poured into fossil fuels.

There’s one simple principle that’s been around in economics for so long that no economist worth his or her degree would question the conclusion: increase the price, watch the quantity demanded go down. It’s such a universal truism that economists call it the “Law of Demand.” Generations of graduate students have estimated the effects of price on demand for anything from the generic widget to demand for car miles driven. People may be irrational at times, but one thing that we know for sure is that they respond to incentives.

Everything we know from decades of the study of human behavior would lead us to believe that carbon pollution will go down as the price on emissions increases. The only interesting question is by how much.

The prescription then for anyone seriously concerned about climate change is simple: price carbon to the point where its now unpriced damages are incorporated into the price, and get out of the way. It’s simple. It works. It’s conservative to the core.

It’s also a silver bullet solution if there ever was one.

Bob Litterman is a Partner at Kepos Capital, LP. Gernot Wagner is a senior economist at the Environmental Defense Fund.

Also posted in Economics, Greenhouse Gas Emissions / Read 1 Response

A Milestone in a Vitally Important Clean Air Act Case Before the Supreme Court

By Pamela Campos / Published: January 23, 2014

This week, we saw another milestone in a vitally important Supreme Court case about the Clean Air Act and our environment.

On Tuesday, EDF and a coalition of environmental groups joined with the U.S. Environmental Protection Agency (EPA) and 15 states in filing briefs to defend EPA’s rules requiring new and rebuilt industrial sources to use cost-effective technology to limit climate pollution.

(The states are New York, California, Connecticut, Delaware, Illinois, Iowa, Maine, Maryland, Massachusetts, New Hampshire, New Mexico, Oregon, Rhode Island, Vermont, and Washington, plus the City of New York. You can read all the briefs here.)

In October, the Supreme Court denied review of EPA’s historic endangerment finding and clean cars standards, and granted review of a single question: whether EPA permissibly concluded that the regulation of greenhouse gas emissions from motor vehicles triggered the application of the Clean Air Act’s Prevention of Significant Deterioration (PSD) and Title V permitting programs to sources of greenhouse gases.

The permitting programs at issue – PSD and Title V – ensure that large new industrial sources use modern cost-effective solutions to mitigate climate pollution in the same way they have effectively addressed other pollutants under the nation’s clean air laws, and facilitate compliance with the entire range of Clean Air Act programs.

The Clean Air Act is clear that both programs apply to large sources emitting “any air pollutant,” and EPA’s regulations have required PSD and Title V permits for large sources of air pollutants subject to regulation for decades.

The petitioners in this case and those filing amicus briefs on their behalf, many of whom are tied to a $900 million effort to obstruct progress on climate and clean energy, want to upend these long-standing protections.

In the process, they present readings of the Clean Air Act that would exclude common-sense modern pollution controls for climate pollution — as well as hydrogen sulfide, sulfuric acid mist, and other air pollutants long regulated under our nation’s clean air laws.

The central theme in their arguments? Someday, EPA might apply these clean air protections to too many emissions sources.

So let’s take a look at greenhouse gas permitting over the last three years:

  • As of this writing, approximately 140 permits have been issued nationwide.
  • Permits cover industries ranging from iron and steel plants to cement plants to power plants.
  • Almost all states are handling their own greenhouse gas permitting.

Meanwhile, EPA is carefully considering next steps for greenhouse gas permitting requirements, including options for lowering the number of sources that might require permits in the future.

The next milestones in the case are coming up soon. Reply briefs are expected on February 15, and the Court will hear oral argument on Monday, February 24.

In the meantime, you can read more about the case here.

Also posted in Clean Air Act, EPA litgation, Greenhouse Gas Emissions, News / Comments are closed

New Power Plant Rule: Strong, Smart, and Legally Sound

By Megan Ceronsky / Published: January 10, 2014

Yesterday EPA published its revised proposed Carbon Pollution Standards for new power plants. When finalized, these standards will be the first national limits on the amount of carbon pollution emitted by new power plants in the United States. The standards will finally require new coal-fired power plants — the largest source of carbon pollution in our country — to install carbon capture technology and sequester the climate-destabilizing carbon pollution they produce underground.

Back in 2011, after testing this technology at a power plant in West Virginia, American Electric Power’s former CEO and president Mike Morris told investors:

We’re encouraged by what we saw. We’re clearly impressed with what we learned and we feel that we have demonstrated to a certainty that carbon capture and storage is in fact viable technology for the United States and quite honestly for the rest of the world going forward.

It is now 2014. The technology is being deployed across the world, and here at plants in Canada, Mississippi, California, and at two plants in Texas. EPA’s standards will ensure that the United States is leading the energy revolution — in carbon capture technologies as well as in clean renewable energy and energy efficiency.

Of course these realities did not stop the attacks from industry lawyers.

Jeff Holmstead, Counsel to the Electric Reliability Coordinating Council — a coalition of coal-dependent energy companies — released a statement arguing that we just can’t do it … can’t produce clean, safe, affordable power. He is wrong. These standards are common sense and legally sound. Not only are carbon capture technologies — long in use in other industries — being deployed in the power sector across the world, but renewables are taking off.

Between 2011 and October of 2013, wind generation in the United States increased by over 40%.  In April of 2013, the United States had a record month for wind power with generation of over 17,000 gigawatt hours. In 2012, rooftop solar panels cost approximately 1 percent of what they did 35 years ago. Since 2008, as the cost of a solar module dropped from $3.80/watt to $.80/watt, solar deployment has jumped by about 10 times.

We can, and we will build the low-carbon power sector of the 21st century—and we will not let those companies still investing in the dangerous, harmful energy technologies of the past dictate our future.

Also posted in Clean Air Act, Greenhouse Gas Emissions, News, Setting the Facts Straight / Comments are closed

EPA Publishes Proposed Standards to Limit Carbon Pollution from New Power Plants

By Mandy Warner / Published: January 8, 2014

November of 2013 was the warmest November on record.

It was also was the 345th consecutive month (that’s almost 29 years!) with a global temperature above the 20th century average, according to the most recent data from NOAA.

So while some folks may be dismissing climate change because of the current blisteringly cold weather in parts of the U.S., we are still very clearly seeing the long-term trend of warming that experts at leading scientific and government agencies (like NASA and many, many others) agree is occurring.

This long-term trend of warming and the serious consequences at stake underscores the need to address carbon pollution now.

Here’s some good news on that front:

Today, the U.S. Environmental Protection Agency (EPA) published its proposed standards to limit carbon pollution from new power plants in the Federal Register.

There are currently no national limits on carbon pollution from power plants, the single largest source of this pollution in the United States.

The standards published today will help ensure that we get our power from cleaner sources, and that we reduce climate-destabilizing pollutants like carbon dioxide.

Cleaner power means healthier lives for millions of Americans.

We are learning more and more about the impact of climate change on human health. From increased asthma attacks to disease and sanitation concerns, a changing climate will have a significant impact on Americans’ health now and in the future.

  • In one recent study, Harvard researchers found that high temperatures correlated with more hospital visits for five conditions including kidney, glandular, and urinary tract problems; accidents; and self-harm.
  • In another study, researchers found that those suffering from allergies or asthma are likely going to have to cope with earlier pollen seasons for some allergenic species in a changing climate.

Health groups, states, moms, environmental groups, and businesses have all expressed support for common-sense limits on carbon pollution. About four million Americans have written to EPA in support of carbon pollution standards for power plants.

This opinion piece from the American Medical Association may best sum up the health risk if we don’t act:

If physicians want evidence of climate change, they may well find it in their own offices. Patients are presenting with illnesses that once happened only in warmer areas. Chronic conditions are becoming aggravated by more frequent and extended heat waves. Allergy and asthma seasons are getting longer. . . . Rising air and water temperatures and rising ocean levels since the late 1960s have increased the severity of weather, including hurricanes and droughts, and the production of ground-level ozone. That means more asthma and respiratory illnesses, more heat stroke and exhaustion, and exacerbation of chronic conditions such as heart disease.

Fortunately, we have the technology to meet our clean energy and human health goals, and EPA’s standards will play a key role in getting us there.

Cost-effective, low-carbon energy solutions are being deployed across the country now. They are creating homegrown, good jobs while protecting Americans health and prosperity.

In fact, ALL of the new electric power that came online in November in America was from renewable energy.

In 2012, wind power was:

[T]he number one source of new U.S. electric generation capacity for the first time—representing 43 percent of all new electric additions and accounting for $25 billion in U.S. investment.

However, there are opposition forces working to derail EPA’s efforts to address carbon pollution.

We need all of the support we can muster to ensure EPA goes forward with its commonsense standards that will help ensure the healthier, clean energy future we know we must achieve for the sake of our children and grandchildren.

Please tell EPA you support a clean energy future for our children

Also posted in Clean Air Act, Greenhouse Gas Emissions, Health, News / Comments are closed

EDF and Allies Defend EPA Emission Standards for Oil and Gas Pollution

By Tomas Carbonell / Published: January 7, 2014

(This post was co-authored by Tomás Carbonell, EDF Attorney, and Brian Korpics, EDF Legal Fellow. It originally appeared on EDF’s Energy Exchange blog.)

A new year may be upon us, but – unfortunately – some members of the oil and gas industry would prefer we roll back the clock on common sense, long-overdue emission standards for oil and gas equipment.

Oil and natural gas production continues to expand rapidly in the United States – and with it the potential for emissions of climate-destabilizing pollutants (especially methane), smog-forming compounds and carcinogenic substances, such as benzene. We urgently need rigorous national standards that comprehensively address the full suite of pollutants from oil and gas facilities, protect public health and the environment and conserve needless waste of our nation’s natural resources.

In August 2012, the U.S. Environmental Protection Agency (EPA) took a promising first step by issuing emission standards for new natural gas wells and other oil and gas equipment, including the thousands of large storage tanks built near gas wells, pipelines and processing facilities each and every year. These “New Source Performance Standards” (NSPS) were based on proven and highly-effective emission control technologies that leading companies have been using for years. Many of these control technologies also directly benefit a company’s bottom line by reducing avoidable waste of natural gas from vents and leaks – saving money while protecting our climate and air.

Regrettably, some industry associations have consistently attacked these common-sense standards. In response to industry petitions seeking to weaken vital clean air requirements for storage tanks, EPA proposed to revise these standards in April 2013. Among other things, the proposed revisions would have created a broad exemption for approximately 20,000 facilities built between August 2011 and April 2013. EDF and five other environmental organizations joined together to file extensive comments strongly opposing these proposed rollbacks, and highlighting the benefits of rigorous national emission standards. Our comments objected that the proposed exemption would lead to massive increases in emissions of harmful pollutants – over 3 million tons of smog-forming volatile organic compounds (VOCs) and 700,000 tons of methane over the lifetime of these storage tanks.

Fortunately, these and other comments prompted EPA to retract this broad exemption in its final rule issued in August 2013. EPA instead maintained its requirement that operators of all high-emitting storage tanks built since August 2011 reduce emissions by 95 percent. EPA noted that the supply of emission controls for storage tanks was adequate, and concluded that the broad exemptions sought by industry were not justified.

Industry responded to this development by taking EPA to court. On November 22, five industry groups – the American Petroleum Institute (API), Texas Oil and Gas Association, Independent Petroleum Association of America, Western Energy Alliance and Gas Processors Association – filed suit in the U.S. Circuit Court of Appeals in Washington, D.C. challenging EPA’s emission standards.

Just before the holidays, Earthjustice and EDF filed a motion to intervene in that suit. Along with several other environmental organizations, we are vigorously seeking to defend EPA’s action and safeguard these national emission standards.

While some industry players attempt to obstruct critical clean air progress, others are supporting common sense air pollution control measures. Last month, Colorado proposed new air regulations for oil and gas operations that, if adopted, will help dramatically reduce harmful air and climate pollution caused by oil and gas operations. The state of Colorado, EDF and three energy companies—Anadarko Petroleum, Encana Corporation and Noble Energy — worked together on these measures that could result in cleaner, safer air for all Coloradoans.

In places like Colorado, diverse interests are putting aside their differences and finding clean air solutions. It’s time for API and other oil and gas associations to do the same – and invest in clean air solutions for our nation, not litigation.

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

New Study — Web of Entities Invests Heavily in Obstructing Climate and Clean Energy Progress

By Vickie Patton / Published: January 6, 2014

A few days ago, the Wall Street Journal reported that Peabody Coal Company is one of the top five worst performing stocks of 2013.

In a year when the S&P 500 was up 29 percent and the Dow rose by 26 percent, Peabody Coal’s stock plummeted by 28 percent.

While most investors recognize the serious environmental and financial risks associated with coal and its pollution, not all do.

Drexel University Professor Robert Brulle reviewed IRS data from 2003 to 2010 and found a web of entities investing over $900 million annually in organizations dedicated to obstructing climate progress and fighting the deployment of safe, clean energy in America.

If you take a closer look at those specific organizations identified in Brulle’s study, you’ll find that several of them are involved – now – in extensive efforts to obstruct climate and clean energy progress under the nation’s clean air laws and leading state programs.

Take a look at these examples:

The Landmark Legal Foundation, Competitive Enterprise Institute and FreedomWorks all just filed briefs before the U.S. Supreme Court challenging the Clean Air Act’s requirement that, at the time of their design and construction, large industrial sources deploy cost-effective modern pollution control technologies to mitigate their climate pollution.

In its challenge to clean air measures for climate pollution, the Competitive Enterprise Institute and FreedomWorks brief (filed along with Southeastern Legal Foundation) relies extensively — and chillingly — on the tobacco industry case FDA v. Brown & Williamson Tobacco Corp. and the legal attacks on our nation’s efforts to eliminate the scourge of youth tobacco addiction:

The Court’s approach to FDA’s assertion of regulatory authority over tobacco products has direct relevance in the present case and should control the outcome here.

(That’s from page 7 of their brief. The Supreme Court has already considered – and rejected – this misguided legal attack in the context of EPA’s authority to regulate climate pollution.)

Earlier this year, the Landmark Legal Foundation unsuccessfully asked the U.S. Supreme Court to review EPA’s science-based determination that six greenhouse gases endanger the health and welfare of current and future generations. They tried to challenge EPA’s determination, anchored in extensive science reflecting decades of research, by ridiculously questioning whether this finding is a “scientific judgment.” (see page 11 of their brief)

The Competitive Enterprise Institute also litigated to overturn New York Republican Governor George Pataki’s leading efforts to cap and reduce the climate pollution from fossil fuel power plants in New York and to participate in a broader regional pollution control program, the Regional Greenhouse Gas Initiative.

On December 5th, New York’s appellate court affirmed the decision of the state’s trial court firmly rejecting these legal attacks.

In his study, Brulle also chronicles the “evidence of a trend toward concealing the sources of [climate obstructionism] funding through the use of donor directed philanthropies” such as the Donors Trust.

A closer look at funding by the Donors Trust through its most recent IRS Form 990 (2011) indicates $1,189,730 in grant funding provided to an organization called the Committee for a Constructive Tomorrow (CFACT).  CFACT is a major outlet for climate denialism.

CFACT, too, just filed a brief with the U.S. Supreme Court in which it asserts that the overwhelming scientific consensus on human-induced climate change is “tenuous, biased, inaccurate, incomplete, unsupported by actual observations, and lacking in scientific integrity.”

The recent scientific findings of the world’s leading scientists set out in the Fifth Assessment Report of the Intergovernmental Panel on Climate Change found that climate change is unequivocal and its impacts are unprecedented and profound.

Another organization that has received support from the Donors Trust according to the Trust’s IRS Form 990 (2011) is the Judicial Education Project.

They also just filed a brief with the U.S. Supreme Court challenging the federal government’s authority to regulate greenhouse gas emissions from the nation’s largest sources of such pollution. The brief alleges that the Environmental Protection Agency exceeded its authority under the U.S. Supreme Court’s 2007 landmark case, Massachusetts v. EPA, in which the Court stated that the “harms associated with climate change are serious and well recognized.”

Earlier this year, the Mercatus Center — another group identified by Brulle’s research — submitted adverse comments on proposed clean air standards for cars and gasoline by calling into question the extensive body of peer reviewed science linking particulate pollution and mortality.

It is well documented that these clean air standards for cars and gasoline will provide healthier, longer lives. They have also won the support of diverse interests, including the American Lung Association and the U.S. auto industry, because of the dual benefits of reducing health-harming pollutants and enabling more efficient clean car technologies.

Recently, the Landmark Legal Foundation joined by the Cato Institute — both groups identified in Brulle’s research — challenged the Department of Energy’s adoption of improved appliance efficiency standards for microwaves.

The microwave standards will lead to less energy use, consumer cost savings and pollution reductions. Landmark Legal Foundation and the Cato Institute objected to DOE’s consideration of the societal benefits of mitigating carbon pollution. Patrick Michaels, a well-known climate denialist, co-authored the Cato comments. Landmark asked DOE to immediately halt implementation and rescind the Rule.

DOE has denied the request to upend these common sense energy conservation standards for our nation.

And it is not surprising that Peabody Coal Company, too, has just filed a brief in the U.S. Supreme Court objecting to the Clean Air Act requirement that our nation’s largest industrial emitters use modern pollution controls to mitigate climate pollution.

Peabody’s brief begins by asserting that “[w]hether and how to regulate GHGs [greenhouse gases] remains a highly debated, contentious issue in Congress, agencies and the courts.” (Page 2 of their brief)

But Brulle’s research elucidates how Peabody’s assertion is a tautology. Through massive funding of groups dedicated to climate obstructionism, Brulle documents how climate change remains contentious because there is a vast climate change counter-movement dedicated to making it so:

[A] number of conservative think tanks, trade associations, and advocacy organizations are the key organizational components of a well-organized climate change counter-movement (CCCM) that has not only played a major role in confounding public understanding of climate science, but also successfully delayed meaningful government policy actions to address the issue.

Climate change is happening. The toll exacted from extreme weather — fueled in part by climate change — on human life and our economy is profound, and reaches from the ravages wrought on New York and New Jersey by Hurricane Sandy to the tragic flooding in the Rockies.

However, the solutions are at hand.

In 2012, wind power was “the number one source of new U.S. electric generation capacity for the first time—representing 43 percent of all new electric additions and accounting for $25 billion in U.S. investment.”

And even more recently, in November 2013, 100 percent – ALL – of the new electrical power in America came from renewable energy.

While Peabody’s stock falls and its rhetoric rises, and while the forces of obstructionism fight clean energy, the winds of change are blowing briskly.

Brulle’s study is a clarion call for moms, dads, grandparents, aunts, and uncles to resolve that in 2014 we will work together to fight for clean air and clean energy for our children — and for all children.

In spite of a well-funded group of obstructionists, we can prevail.

We can secure climate progress and clean energy for our nation, for our communities and for our future.

Also posted in EPA litgation, Greenhouse Gas Emissions, News, Setting the Facts Straight / Read 1 Response