Climate 411

Second California-Quebec-Ontario carbon auction sells out, showing market’s strength

By Katelyn Roedner Sutter / Published: May 23, 2018

 

https://www.pexels.com/photo/golden-gate-bridge-san-francisco-61111/

San Francisco Golden Gate Bridge. Photo by Juan Salamanca.

The second California-Quebec-Ontario joint greenhouse gas allowance auction has sold all current allowances, just like the inaugural tripartite auction in February 2018. There was again strong demand for future allowances, all indicating that despite political and regulatory uncertainty from a key partner, Ontario, the market is on solid ground.

May auction at-a-glance:

  • All 90,587,738 current and previously-unsold allowances sold, clearing at $14.65, which is 12 cents above the $14.53 price floor. This is slightly higher than the February settlement price.
  • 6,057,000 of the 12,427,950 future vintage allowances offered sold at the floor price. This is 2,519,000 million less than sold at the February auction. The decrease is likely due to ongoing uncertainty in Ontario, but as these allowances are not available for use until 2021, it is still an indicator of confidence in the Western Climate Initiative market down the road.
  • An estimated $681,051,270 was raised for California’s Greenhouse Gas Reduction Fund to continue funding climate and equity priorities like urban greening, electric vehicle infrastructure, and affordable housing near public transit.
  • Ontario raised approximately $369,271,300 USD for funding public transit, electric vehicle incentives and energy efficiency upgrades.
  • Quebec raised approximately $151,353,660 USD to support the province’s transition to a green economy.

These results are encouraging because they show that despite ongoing political uncertainty in Ontario, the market is strong and stable. They also show the benefits of linkage to a larger market are real. All three linked jurisdictions have access to more trading partners through the Western Climate Initiative, which creates opportunities for even greater climate ambition. This kind of international cooperation shows that jurisdictions can have an outsized influence on global climate action, particularly at a time when federal leadership from the United States on climate is lacking.

Previously unsold allowances
The role of previously unsold allowances could also be impacting today’s auction results in two ways.

First, this is the third auction where held, or previously unsold allowances were offered for sale. These allowances increase the number of available allowances in the auction, which may contribute to keeping the price near the floor. This demonstrates the importance of that price floor. It is a central feature of the program that ensures stability of the market and the revenues.

Second, back in July 2017 the California Air Resources Board (CARB) adopted the so-called “24 Month Rule.” This establishes that any state-owned allowances that remain unsold for 24 months are either moved to the Allowance Price Containment Reserve (APCR) or retired. This has the effect of tightening the cap either temporarily (if prices were to unexpectedly jump) or permanently. The first significant retirement of allowances could happen after the August auction, so companies could be buying now in anticipation of decreased supply later.

Looking Forward
CARB is in the process of drafting a regulatory update for the cap-and-trade program post-2020. The program has been successful at reducing emissions, as demonstrated by current emissions being below the cap, even as California has grown to the fifth largest economy in the world. This emissions trend provides an important opportunity for California to continue driving increased ambition by setting a tighter post-2020 emissions cap, and continue showing that ambitious climate action can go hand-in-hand with strong economic growth.

Of course the biggest question in the linked carbon market right now is Ontario, which is having elections in June. Although two of the leading parties want to preserve the program, one party wants to end it, but would need to overcome a mountain of legal hurdles. The outcome of the June election could set up either increased confidence in the future of cap-and-trade in Ontario or lingering questions. But the results for both current and future vintage in this auction indicate that confidence is steady, and the California-Quebec-Ontario market remains a world leader in driving climate action.

Posted in California, Carbon Markets / Comments are closed

Sowing the seeds of a roadmap for agriculture

By Breanna Lujan / Published: May 16, 2018
Photo credit Dr Huynh Quang Tin

Low carbon rice production in Vietnam. Dr Huynh Quang Tin

At last November’s COP23 in Germany, Parties involved in the United Nations Framework Convention on Climate Change (UNFCCC) negotiations on agriculture celebrated a notable victory after agreeing to create the Koronivia Joint Work on Agriculture (KJWA). The KJWA marks a shift in focus from agricultural adaptation activities only, to a broader discussion of mitigation related activities. While COP23 Parties did not decide on the details of the KJWA, such as the “how” and the “when,” the outcome generated much needed momentum for the agriculture agenda of the UNFCCC.

In the lead up to the Bonn climate change negotiations that concluded last week, Parties and observers submitted their views on the “what”, “how”, and “when” of the KJWA. The Parties kept a very constructive – and even friendly – discourse in negotiation sessions, building off of last year’s positive COP23 outcome and increasing focus on implementation. The developing country group known as the G&77 + China, building off a New Zealand-led proposal, was very active in coordinating the creation of a roadmap for the KJWA. By the end of the first week, Parties agreed to draft conclusions outlining the roadmap.

Now with the UN secretariat for adoption, this roadmap provides an agenda of activities that includes workshops, topic submissions, and workshop reports every six months between now and the end of 2020. The series of workshops will cover the following topics:

  • How to implement the outcomes from the five in-session workshops on adaptation and resiliency held before last year’s COP decision;
  • Methods and approaches for assessing adaptation, adaptation co-benefits, and resilience;
  • Improved soil carbon, soil health, and soil fertility under grassland and cropland as well as integrated systems, including water management;
  • Improved nutrient use and manure management towards sustainable and resilient agricultural systems;
  • Improved livestock management systems, including agropastoral production systems and others; and
  • Socioeconomic and food security dimensions of climate change in the agriculture sector.

Submissions on topics for each workshop will be solicited prior to each session, followed by the preparation of a report after each workshop.

The first activity on the roadmap—submissions on implementing the outcomes of the five in-session workshops on adaptation and resiliency—is due on October 22, 2018. Considering that Parties in Bonn solicited external inputs for current and future discussions, organizations like the Environmental Defense Fund have the opportunity to help advance the KJWA roadmap. By providing technical assistance, content, and process inputs, EDF and other organizations will support the work of Parties under the KJWA and maintain momentum. It is imperative to use this time to determine what issues to focus on during this series of workshops and how to operationalize the outcomes.

As reflected by the nature of the KJWA itself, shifting focus to implementation and tangible actions to help actors in the agriculture sector respond to climate change is essential if we are to meet the climate goals laid out in the Paris Agreement.

Posted in Agriculture, International, United Nations / Comments are closed

Five things you need to know about the U.S. Clean Car Standards

By Alice Henderson / Published: April 30, 2018

Cars on a dealer lot, waiting to be sold. Photo: Every Car Listed

America’s Clean Car Standards are one of our biggest success stories, yet the Trump Administration is preparing to dramatically weaken them.

News reports say the Trump Administration is also taking aim at state leadership on clean cars, by preparing to challenge California’s and 12 other states’ authority to maintain more protective standards.

Here’s what you need to know:

Read More »

Posted in Cars and Pollution, Clean Air Act, Economics, Greenhouse Gas Emissions, News, Policy, Pruitt / Comments are closed

Pruitt admits lying, blames others, and leaves behind a cloud of questions: 3 takeaways from today’s hearings

By Elgie Holstein / Published: April 26, 2018

After a month of revelations and allegations about his tenure in EPA and in Oklahoma, Scott Pruitt finally had a chance to provide straight answers to Congress about his mounting ethics problems.  The results were not encouraging:

  1. Caught:

    The top story coming out of today’s hearings is that Scott Pruitt admitted that he lied.

    He told Members of Congress that he knew about his employee raises, despite having told Fox News on April 4 that “I found out this yesterday.”

    CNN reports:

    “Several senior EPA officials reacted in shock Thursday. One EPA official told CNN that a sense of ‘a collective “Oh sh**” came out of EPA HQ’ when Pruitt admitted he knew of the raises.

    Aides for weeks knew that Pruitt had lied in his Fox News interview, but were stunned that he contradicted himself so publicly on Thursday.”

    Added John Roberts from Fox News: “This may be the end of the line.”

  2. Says it not his fault:

    Asked about multiple accusations of ethical problems, Pruitt shifted blame to everyone else: Milan Hupp, Ryan Jackson, Kell Kelly, and anyone else carrying out his orders, and at one point, “the process.”

  3. Dodges the Questions:

     

    Many big questions were left unanswered, including:

    • $43,000 Phone Booth: Pruitt insisted that he asked for a “secure line” because of a single telephone call. What was so important about that incident? And Pruitt went on to admit that such calls are “rare”—if so, why can’t he go to one of EPA’s two other secure phones, as his predecessors did?
    • Illegal Use of Government staff: Pruitt said that he was “not aware” of Millan Hupp spending government time looking for his apartment. Unanswered: Did he ask Millan Hupp—or anyone else on his staff — to look for an apartment for him?
    • Demoting Staff: Did Pruitt tell his chief of staff not to come to travel planning meetings after he raised concerns about Pruitt’s travel?
    • Kell Kelly: Did Pruitt ever inquire why Kell Kelly was banned for life from banking by the FDIC when he hired him?
    • Condo: On the condo lease, why was Stephen Hart’s name originally typed in as “landlord,” but then scratched out and the name of his wife scribbled in?
    • Private Jet: Was it Pruitt who sought to have the EPA pay $100,000 per month to rent a private jet, as Trump campaign staffer and EPA employee Kevin Chmielewski claims?
    • Morocco Trip: Before traveling to Morocco, why was Pruitt’s only briefing before the trip conducted by political staff, not career staff in the agency’s international affairs office, which typically coordinates foreign trips?
    • Oklahoma Travel: As Oklahoma Attorney General, in January 2016 Pruitt traveled to Washington, D.C., costing taxpayers more than $1,000 to meet with the Federalist Society and Club for Growth. Did Pruitt reimburse taxpayers? Did he use taxpayer money for political or personal trips?
    • Enforcement: Why did Pruitt try to end EPA funding for Justice Department Superfund enforcement efforts, and cut EPA enforcement against criminal polluters?
    • Super-polluting trucks: EPA proposed a loophole for super-polluting glider trucks, citing an industry-funded study now being investigated for research misconduct. Will it withdraw the proposal?

There are many more unanswered questions .

Posted in News / Comments are closed

Proof that the Clean Power Plan’s strategy for cutting carbon pollution is the industry standard

By Charlie Jiang / Published: April 26, 2018

The public comment period is just about to close on EPA Administrator Scott Pruitt’s reckless attempt to repeal the Clean Power Plan, and thousands of Americans — including mayors, CEOs, energy experts, and citizens concerned about the threats Pruitt’s actions pose to our children’s health and future — have already spoken out in vigorous opposition to the misguided repeal effort.

There is a lot at stake. The Clean Power Plan would prevent 4,500 early deaths and 90,000 childhood asthma attacks each year. It would cut carbon pollution by 32 percent from 2005 levels, and would substantially reduce other harmful air pollutants from power plants.

By slashing air pollution and helping mitigate the threats of climate change, the Clean Power Plan would secure significant benefits to public health while growing the clean energy economy.

Yet, as Pruitt continues his misguided effort to turn back the clock on lifesaving climate protections, momentum is growing in states and the power sector to slash carbon pollution and usher in a clean energy future.

States and companies are moving away from carbon-intensive sources of electricity generation, and are increasing their use of cleaner technologies — deploying the same cost-effective strategies to cut carbon pollution that EPA relied upon when establishing emission reduction targets under the Clean Power Plan. Pruitt’s attempt to repeal the Clean Power Plan is putting this flexible approach to ambitious and low-cost emission reductions under attack.

Read More »

Posted in Clean Air Act, Clean Power Plan, Economics, Energy, EPA litgation, Greenhouse Gas Emissions, News, Policy, Pruitt / Comments are closed

86 Questions and Counting for Scott Pruitt

By EDF Blogs / Published: April 25, 2018

By Elgie Holstein

Spring has been EPA Administrator Scott Pruitt’s season of scandal, with each day bringing fresh allegations of the EPA Administrator’s reckless disregard for his boss’s promises to “drain the swamp.”

Worse for the country, he has adopted a sense of entitlement, which appears to have long pre-dated his arrival in Washington.  In so doing, he has broken laws, flouted ethics rules, ignored congressional intent and requests, and sought the trappings of power and prestige.

A maelstrom of scandals throughout the first year of Pruitt’s tenure surfaced questions regarding his first-class flights, a sweetheart condo deal from the wife of an energy lobbyist, unauthorized pay raises for close associates, his penchant for secrecy and love of perks, and the demotion of EPA employees who questioned his spending.

Since then, another flood of stories has generated even more questions:  An EPA inspector general report showing that Pruitt didn’t tell the truth when he said he knew nothing in advance about  the raises. A string of allegations by former deputy chief of staff Kevin Chmielewski.  An OMB investigation of his $43,000 phone booth (which the GAO says was illegally paid for, and which, in any case, was unneeded). A meeting with a lobbyist who co-owned the condo he rented.  Questionable insider dealings during Pruitt’s days in Oklahoma.

It is regrettable that each new story brings little surprise at how naturally Pruitt navigates and takes advantage of the swamp. But he has proven himself to be a man who shamelessly advances his own political ambitions and the desires of polluters at the expense of Americans who must watch a public official thumb his nose at ethical behavior while pursuing an agenda that makes our air, water, and land dirtier, and climate change worse.

In all, we now count at least 86 questions that need answering, with more seeming to emerge every day.  As Pruitt prepares to face two Congressional committees Thursday, lawmakers are noticing the scandals unfolding before them.

“If the allegations are true,” notes Rep. Bill Flores (R-TX), “they are troubling, and we should expect higher of any person in public office.”

Representative Flores is right—we should expect better. We should also expect that an individual tasked to lead EPA will prioritize the well-being of families and the environment over the wishes of close friends and industry. Pruitt fails on both accounts.

Two hearings may not be enough to cover all the questions.  But here are ten of the biggest questions to which Americans deserve answers:

  1. Why did Mr. Pruitt tell Fox News he had no prior knowledge of raises given to two staffers he brought from Oklahoma when an EPA Inspector General report now shows that Pruitt signed off on them?
  2. Did Pruitt sometimes pick travel destinations based on his personal desires, and ask his staff to “find me something to do” to justify the use of taxpayer funds, as a former EPA staffer alleges?  How many taxpayer-funded trips home to Oklahoma or elsewhere were justified on the basis of a single hurriedly scheduled meeting?
  3. If Pruitt needs to fly first class for security reasons, why did he fly coachon personal trips home to see Oklahoma football games—when he could not concoct a reason for the taxpayers to pay his way?
  4. Did Pruitt really text his chief of staff to tell him not to come to travel planning meetings after he raised concerns about the Administrator’s travel?
  5. Why were at least five EPA officials (four of them senior)reassigned or demoted, or asking for new jobs after questioning Pruitt’s spending priorities?
  6. Will EPA’s new #2 official, former coal and energy lobbyist Andrew Wheeler, be granted any waivers from his ethics pledge or other restrictions on helping former clients?
  7. Did one of Pruitt’s staffers spend weekshelping Pruitt search for an apartment, contacting agents and touring properties?  For what other personal chores did Mr. Pruitt enlist government workers?
  8. During Pruitt’s December 2017 trip to Morocco to promote natural gas — which is not part of the EPA’s mission — did he discuss Cheniere Energy Inc., which is partly owned by Donald Trump’s friend Carl Icahn?  (Icahn helped promote Pruitt for the EPA job.)
  9. Does Pruitt agree with EPA air chief William Wehrum that the Mercury and Air Toxics Standards, which protect children from serious harm, “may not be necessary?”
  10. What is the full story behind the lavish home of a lobbyist eventually making its way to a shell company of which Pruitt was a stakeholder? That same lobbyist’s client would receive favorable treatment from Pruitt in the future—were any backroom deals made during the transfer of the property?

As a cabinet-level official, Scott Pruitt is supposed to set an example for public servants.  Instead, he has created a growing cloud of questions about his ethics, his honesty and his fitness for public life.  On behalf of America’s taxpayers, Congress needs to start asking Scott Pruitt questions — a lot of them.

Posted in News / Comments are closed