Archive for the ‘Climate Policy’ Category

Good, Bad, or Worse Then Nothing

The case against the American Power Act from Gar Lipow:

1) Bills only getter better when they don’t make things worse from the beginning:

All the cases I can find of weak reforms that grew stronger over time avoided one flaw that is prominent in Kerry-Lieberman. No matter how weak they were, they contained no features that made parts of the problems they were trying to solve worse. The 1957 Civil Rights act did not increase Jim Crow in limited areas to buy off racist Senators. The original Social Security act did not repeal any existing pensions, nor weaken any existing protections for workers or old people.

And APA makes things worse:

The nominal target has already been more than halfway met just by emissions reductions from the current recession and existing “command & control” legislation. Most of the remaining target could be met by offsets, legal counterfeit do-it-yourself emission permits. So at best the bill would produce few, if any, real cuts – nowhere near the reduction claimed in the nominal cap. Worse, many types of offsets could end increasing emissions even before they served as permission to continue burning coal.

For example, we may see ethanol (which has higher greenhouse gas emissions per mile than gasoline) credited as a carbon offset. Or we may see types of forestry which might release centuries of banked carbon from trees and soil credited as carbon reductions. The protection of offset additionality is phrased in stern generalities with specifics left to regulators. So we don’t really know what would or would not be allowed. In an age of regulatory capture, that is not good news.

Even worse, the KL bill repeals the EPA’s authority to regulate greenhouse gases. The usual reply from KL supporters: “That old thing? We weren’t using it anyway. And that broom is missing a few too many bristles to sweep clean.” That misses two points. However weak or strong that authority is, it is the only leverage to get climate legislation through a 60-vote Senate. Pass weak legislation that eliminates the EPA, and what will you use as leverage to strengthen it? Especially after you start seeing big agriculture and forestry garnering massive profits from the counterfeit permit industry (otherwise know as offsets). And while EPA authority does not include the ability to reduce emissions in as optimum a path a we would like, the EPA certainly has authority to reduce emissions by more than the KL bill does.

I’d suggest the issue EPA reductions vs. KL really hinges on how far into the future you’re talking about. Since KL is so weak in terms of what counts as an emission reduction and how little reductions we get in the next ten years even modestly successful reductions created by EPA regulation, would result in a lower emissions path by 2020. But going further the dynamics would probably start to shift in favor of APA.

I say probably because the offset market could expand enough to nullify even the harder limits and the EPA path doesn’t involve cutting off any additional programs. Most people think the offset market couldn’t get that big/ineffective and in political environment where it did EPA regulation would have similar problems.

It’s hard to see either path making a strong case for improving the future, passing a bad bill would reduce the urgency for action, but another failed bill hurts the cause. The scenario I most want to avoid is a wide acceptance within the environmental community of a bad bill that doesn’t pass, laying the ground work for an even worse bill in the future.

-Chris

Climate Science and the Split Over the American Power Act

Good run down of the big green vs. little green dust up over the the American Power Act by Jonathan Hiskes. However, this passage isn’t really accurate:

It’s worth noting that all the groups involved have shown they understand the scientific urgency of an aggressive clean-energy plan.

Maybe off the record that’s true, but on the policy level there are real differences between what they’re saying. You’ve three camps:

1) The 450ppm is OK crowd,
2) 350.org saying the present levels are dangerous
3) James Lovelock and other pessimists saying we’re all doomed.

The 450ppm camp pretty much fell apart, in that most of them will basically say that 350 might well be the right goal. Saying anything else would seriously undermine their leadership position even more after all the flack they’ve taken from the little green groups calling their legislative agenda a big polluter give away. But it doesn’t really translate into a change in their agenda, it’s still based around the old idea that we’re in the safe zone and can safely keep going up. The emissions targets just aren’t strong enough to believe that the the plan isn’t to let CO2 reach 450ppm and only lower it slowly from there. The was the official plan 3-4 years ago and nothing has changed.

The 350.org folks start from the position that the science says danger is at the door step. Thus we need stronger emissions targets, more money, more effort and less compromise. Politically we need more effort around long-term movement building and to just forget about the current legislation. Use every tool, read pressuring for the strongest possible action by the EPA, in the short term.

James Lovelock is basically saying that only the unequivocally politically impossible action will avert climate change and even that probably wont be enough. He basically endorses the 350.org agenda, plus drastic life boat policies. I once wondered if he’d tell Obama to consider invading Greenland or telling young people with children to move to Canada.

Surely a lot of the differences causing the split are political, personal, and philosophical, but there’s science behind the policy and it’s not the same science.

-Chris

The Discounted Future

Note: The Carrots and Sticks Blog has been down for a bit, but we’re back now. Also let me apologize now for the long post.

I thought this was an interesting post by Brad Delong on the Costs and Benefits of climate action.

First a review Cass Sunstein and how he might begin to calculate when to act on climate change.

After all, if money depreciates at say, 3 percent a year, then spending $1 million today is the equivalent of spending only about $860,000 of today’s dollars five years from now. Over very long periods, like those involved in climate change, the discount rates that are applied to short-term problems like budgets build toward absurdity: using one common method, spending $1 million today to forestall climate change would be the equivalent of spending $2,300 in 2100. Calculations like this seem to argue against doing anything now. The problem, Sunstein says, is that we might do irreversible damage to the planet while blithely waiting for the price of action to drop just enough…. As an academic, Sunstein seemed to side with economists like William Nordhaus at Yale, who set the discount rate at about 5 percent, which would counsel patience. “It’s not clear what direction the risk of error cuts in,” he told me. “If we err, 7 percent could be bad,” he said, but “if we err, 1 percent could be bad also.” A low a discount rate might protect the environment by spurring us to sacrifice now — while damaging the economy, increasing poverty and putting more people out of work. The difficulty is that the experts are lined up “out the door and down the block on both sides of this issue,”

Brad Delong retorts:

Here we have yet another example of why law professors should simply not be allowed to practice law and economics or moral philosophy without a license–and of how Cass Sunstein has never bothered to do the work necessary to acquire a license to practice law and economics.

First, “irreversible damage”: we are doing irreversible damage to the environment every day in that every day human activity brings more species closer to extinction, and natural or artificial selection would never be able to resurrect them no matter how much money we would spend trying to do so. The question that must be asked: is how much we care–how damaging is the “irreversible damage,” and what other goods are we willing to forego in order to avoid it? What Sunstein implies–that “irreversible damage” is something that must be avoided and that trumps cost-benefit calculations–is simply incoherent, and does nothing other than perform the function of getting him onto Obama administration message without admitting that he does not understand why the cost-benefit analysis tools he loves so much are leading him to what is for an Obama administration official an off-message conclusion.

Delong goes on to suggest Sunstein is using the wrong type of discount rate since we’re discussing human lives and welfare. I don’t know why Sunstein thinks it’s “It’s not clear what direction the risk of error cuts in”.

Using either the pessimistic or optimistic scenarios at some point reach feedback loops where it’s either impossible or much more expensive stabilize the climate. Further the do something now approach proposed by the Obama Administration is really a do something over the next 30 years and probably longer approach and it’s back loaded towards doing more 2020-2040.

Pretty much all the scientific questions about energy research and development and ecology point towards some strategy, starting sooner then later. Economics doesn’t exist in bubble, if you’re positing we can wait and wait and wait you’re not looking at the whole picture.

Event Review: Joe Romm drops some wisdom

As Chris and many, many others have mentioned, Joe Romm is perhaps the most effective  climate blogger out there. Or as Rolling Stone says, the “fiercest”. He’s just released a new book, “Straight Up: America’s Fiercest Climate Blogger Takes on the Status Quo Media, Politicians, and Clean Energy Solutions” and is discussing his experiences that led to the book at Center for American Progress HQ.

Romm never naturally saw himself as a blogger. His dad worked at a newspaper, and he thought journalism simply wasn’t for him. He was a scientist, and focused on making the empirical case for action to stop climate change. He never even realized, however, how big a deal it was until the consensus started building among fellow scientists.

And that’s probably why I like him so much. He’s an empiricist in red alert mode, much like myself. And his insights about the failure of the old media establishment to dig down to the substance of the climate crisis are spot on, frankly not just with this issue but most others as well. The horse race, he-said-she-said dynamic just doesn’t work to get people the facts they need. With messaging gurus carefully crafting messages catering to those who wish to continue the status quo , “fair and balanced” simply cannot do justice to a very complicated issue. Romm believes his blog is different, because he can present real solutions without having to worry about presenting quotes from people he believes are full of it. He also tends to beat the media to stories, even hammering at a point until it shows up in mainstream coverage, and that’s his greatest satisfaction about being a blogger. I’ve gotta agree with him there, which is why I get most of my news from new media sources these days. As Kos and friends always say, it’s like getting the newspaper a week early.

The other major point that fascinated me was his repeated refrain that the climate scientists just aren’t well versed enough in messaging to combat the constant industry and right-wing disinformation campaign to vilify climate science. Scientists, of course, are terrible at messaging, practically by definition. Their natural inclination is to not report a conclusion until it’s 100% certain, and even then caveats must be recognized. That is a very valuable viewpoint to have, but it is decidedly poor in producing useful sound bytes that accurately capture the substance of the scientist’s conclusions. Then, when scientists are dead sure of something and actually very alarmed about it, their natural response is to repeat their point over and over again in the hopes that it’ll break through. Problem is, in the era of the spin doctor people will simply tune that message out unless it’s framed in a more accessible manner. So a new strategy is needed. In other words, they need a Media Matters style campaign to directly fight back.

At the same time, Romm also believes the move away from direct discussion of climate change and onto peripheral foci (“clean energy jobs”, “energy independence”, etc.) has had a detrimental effect on the push to actually do something about global warming. It’s made the substance of climate mitigation efforts reasonably popular, but the direction away from scientific reality has ceded too much ground to the smear merchants poking holes in the core of climate consensus.

Other notable insights:

  • The lack of significant progress in tackling global warming to date affects public opinion. When people hear that a problem exists but nothing happens to solve it, they tend to grow skeptical.
  • The Kerry-Graham-Lieberman bill will disappoint many progressives. The Senate faces the same issue it did with health care: how do you get to 60 without losing the left flank? It will be tough, and no guarantee that it can happen, but it’s not impossible.
  • At the same time, K-G-L probably not by itself be enough to fix global warming. But we saw the same thing with the ozone layer. The initial Montreal Protocol in 1987 wouldn’t have been enough either, but it was strengthened later as the forecasts became more dire, and we managed to save the ozone layer in the nick of time. This is a very similar situation, and we have to start acting now if we are to eventually get to a workable solution.
  • The old-school environmental movement has made a great mistake in their focus, ignoring their own past accomplishments to make the air and water cleaner in very direct ways.
  • Earth Day is also the entirely wrong focus. It’s downright silly to think we can or need to save the Earth. In fact, the planet will be just fine without us. We should be much more concerned about saving the people, which is really the point of stopping catastrophic climate change. (this is a point I very strongly agree with)
  • So what does catastrophic climate change look like? If we don’t drastically cut our emissions within the next half-century or so, we could see an ice-free world in a couple centuries, which would lead to roughly a 200+ foot sea level rise. Kiss all of the world’s coastal cities goodbye. Oh yes, and most of the western U.S. will become a dust bowl within a few decades.
  • There is a major difference between “weather” and “climate”. The fact that the past couple years have been rather mild in the United States does not mean the planet isn’t getting warmer. People who read the weather on TV often flippantly joke about climate change not being real because it’s cold today. They really need to STFU….in Romm’s words, asking a weatherman about climate change is like going to the dentist if your kid gets the flu.
  • It’s always easy to convince people to do nothing. Plus, when you don’t have to stick to the facts you can create a very compelling narrative.

Finally, I noticed Kate Sheppard was also livetweeting the talk. You can find her comments @kate_sheppard.

-Jeremy

The “War” Against Coal

It’s rare that you have a truly hostile Congressional hearing. Here’s Rep. Jay Inslee responding to big coal executives complaining about a war against coal:

“If there is a ‘war’ being waged here, it’s being waged by your industry against our grandchildren,” said Inslee at one point. “Is it fair for the coal industry to be able to put CO2 in the atmosphere at zero cost?”

As I understand it was also pointed out that Waxman-Markey contains upwards of 60 billion in coal giveaways. So apparently the strategy is to drop bags of money on big coal until they surrender.

It’s no wonder people are looking for an alternative strategy?

-Chris

Massey Energy Disaster Fallout

Via Brad Johnson at Think Progress.

The good news

Shareholders are calling on Massey Energy to seek the immediate resignation of chairman and CEO Don Blankenship in the aftermath of the West Virginia disaster that killed 29 miners, the worst in forty years. The Change to Win Investment Group — a union pension fund group with over $200 billion in assets — believes the Upper Big Branch mine explosion is the “tragic consequence of the board’s failure to challenge Chairman and CEO Blankenship’s confrontational approach to regulatory compliance.”

and the bad news:

Yesterday, Standard & Poors upgraded Massey to a “buy,” saying the tragedy’s “financial effect” was “immaterial.”

Clearly the legal system is failing when 29 employees dead, doesn’t rate as a financial problem. Massey energy has a long and exceptionally awful safety record and yet the S&P is confident that 29 deaths will have only external costs to the company.

-Chris

Climate Econ 101

Paul Krugman is wrong that a Pigovian tax and Cap and Trade systems are “more or less equivalent”*, but this article is a great read nonetheless.

The view from the Reality Based Community:

Just as there is a rough consensus among climate modelers about the likely trajectory of temperatures if we do not act to cut the emissions of greenhouse gases, there is a rough consensus among economic modelers about the costs of action. That general opinion may be summed up as follows: Restricting emissions would slow economic growth — but not by much. The Congressional Budget Office, relying on a survey of models, has concluded that Waxman-Markey “would reduce the projected average annual rate of growth of gross domestic product between 2010 and 2050 by 0.03 to 0.09 percentage points.” That is, it would trim average annual growth to 2.31 percent, at worst, from 2.4 percent. Over all, the Budget Office concludes, strong climate-change policy would leave the American economy between 1.1 percent and 3.4 percent smaller in 2050 than it would be otherwise.

And what about the world economy? In general, modelers tend to find that climate-change policies would lower global output by a somewhat smaller percentage than the comparable figures for the United States. The main reason is that emerging economies like China currently use energy fairly inefficiently, partly as a result of national policies that have kept the prices of fossil fuels very low, and could thus achieve large energy savings at a modest cost. One recent review of the available estimates put the costs of a very strong climate policy — substantially more aggressive than contemplated in current legislative proposals — at between 1 and 3 percent of gross world product.

And the we make up reality as go along community:

What you hear from conservative opponents of a climate-change policy, however, is that any attempt to limit emissions would be economically devastating. The Heritage Foundation, for one, responded to Budget Office estimates on Waxman-Markey with a broadside titled, “C.B.O. Grossly Underestimates Costs of Cap and Trade.” The real effects, the foundation said, would be ruinous for families and job creation.

This reaction — this extreme pessimism about the economy’s ability to live with cap and trade — is very much at odds with typical conservative rhetoric. After all, modern conservatives express a deep, almost mystical confidence in the effectiveness of market incentives — Ronald Reagan liked to talk about the “magic of the marketplace.” They believe that the capitalist system can deal with all kinds of limitations, that technology, say, can easily overcome any constraints on growth posed by limited reserves of oil or other natural resources. And yet now they submit that this same private sector is utterly incapable of coping with a limit on overall emissions, even though such a cap would, from the private sector’s point of view, operate very much like a limited supply of a resource, like land. Why don’t they believe that the dynamism of capitalism will spur it to find ways to make do in a world of reduced carbon emissions? Why do they think the marketplace loses its magic as soon as market incentives are invoked in favor of conservation?

* The Cap in the Cap and Trade proposals is a downward moving cap, which theoretically could eventually lead to the elimination of emissions all together. It’s only in the short term that C&T would act as a de-facto Pigovian tax, in the long term it looks more like a strict mandated pollution reduction.

Fight for CLEAN-TEA Still Alive and Well

Hopefully it’s been made pretty clear on this blog and in other Carrots and Sticks materials that if we were to write a comprehensive energy and climate package of our own, we would support a cap-and-dividend approach to carbon pricing akin to that of the Cantwell-Collins CLEAR Act accompanied by a Green Bank initiative to leverage up to $1 trillion of private sector investment in the new green economy. However, the Kerry-Graham-Lieberman framework that seems to be moving now is far short of that in terms of both simplicity and effectiveness. Both Chris and I still don’t think it has close to 60 votes and this all may be a moot point, but nevertheless it’s worth working to improve the KGL language as much as possible.

Part of our climate agenda, basically a backup plan if direct cap-and-dividend doesn’t happen, is allocations or investment of climate revenues in clean transportation projects. The now-defunct CEJAPA bill did a pretty good job of this, and we’d like to see that commitment be continued in this new initiative. On Monday, Transportation for America delivered a letter to its three chief architects reiterating this request, and we are proud to be one of the letter’s 41 co-signers.

Here’s the letter in full:

View this document on Scribd

-Jeremy