With Democratic Senators Boxer and Kerry preparing to launch their Climate Bill salvo into the Senate, opponents are gearing up for a fight.
According to USA Today, "Sen. James Inhofe, R-Okla., one of the Senate's most vocal opponents of climate-change action, predicted the bill won't even be debated on the Senate floor before the end of the year, let alone come up for a vote."
The New York Times reports that "...the 684-page Senate draft bill (pdf) diverges from the House measure in its push for a 2020 emissions target of 20 percent, compared with the House's bill's 17 percent limit.
Both the House-passed bill, H.R. 2454 (pdf), and the preliminary Boxer-Kerry proposal contain the same longer-term emissions limits of 42 percent below 2005 levels by 2030 and an 83 percent cut for 2050."
I haven't had a chance to read the Senate draft bill, but will try to have a look at it in the next day or so.
But it sounds like Senators on both sides may want to get out their boxing gloves.
LONDON, April 1 - US President Barack Obama today told the leaders of the G20 that he was "putting a gag order on greenhouse gas emissions" and that the US was going to start at home, with Congress and members of his own Administration.
"Today I have imposed a gag order on the most harmful greenhouse gas polluters in the United States," President Obama told the group of leaders gathered in London. "I have put a gag order on certain members of Congress and on members of my own Administration."
In an unusual move, the President revealed details of his plan, which many are calling the "Greenhouse Gag-order," specifically referencing some of the most wasteful CO2 polluters in Washington.
"I have put Representative Barney Frank on notice," Mr. Obama told an enthralled crowd. "Look, it's as simple as this: If he opens his mouth again, he will have to pay a hefty fine."
In addition to Congressman Frank, Chairman of the Financial Services Committee, Mr. Obama named Timothy Geithner in his gag order, suggesting that his Treasury Secretary will only be allowed to speak during the work week. This move may be designed to help curtail the Secretary's long-winded explanations on weekend television news media, which have only exacerbated the financial picture.
"Look, we have to do something about the windbags in Washington," Mr. Obama said. "It is my hope that the Secretary and Mr. Frank will be leaders in putting a cap on the greenhouse gas emissions in our own hallowed halls."
Mr. Obama went on to say that he hoped others in Washington would follow suit, and that he was considering a voluntary carbon credit option to be implemented as early as this summer.
Secretary Geithner, when asked for comment on the President's plan, said, "This is consistent with the Administration's plans to tax wealthy individuals across the board. We feel a carbon cap on loquacious individuals is totally within our reach."
A person close to the Office of the President indicated the Administration was considering similar sanctions on vociferous celebrities, such as Rush Limbaugh, Oprah Winfrey, and Robert Scoble.
Calls made to Rep. Frank's office for comment went unanswered.
President Obama wants to help fight climate change by capping emissions of greenhouse gases such as carbon dioxide, or CO2, from big industries -- and now individuals -- and allowing them to trade rights to pollute. Such systems are commonly called "cap and trade."
My friends over at Red, Green and Blue report that President-elect Obama is a big presence at the Climate talks this week in Poznan, Poland, even if he's not actually there:
It's the fourteenth session of the Conference of the Parties to the UN Framework Convention on Climate Change (COP14), and the fourth meeting of its kind this year.
"The pending change in American leadership is palpable in Poznan," writes Timothy B. Hurst of RGB. The "global climate conferees see the potential of president-elect Barack Obama ushering in a new era of U.S. leadership on the environment."
Obama didn't send an official delegation; after all, the US still has only one president, according to some. But Massachusetts Senator John Kerry did go to observe the 12-day conference.
President-elect Obama's plan is getting props at the sessions, according to Hurst and other reports.
"It's ambitious," Yvo de Boer, the UN’s top climate official said of Obama's target of slicing CO2 emissions to 1990 levels by 2020, with a further 80 percent by 2050.
He'll have 11 months to work his magic on the global stage and hammer out an agreement that includes the US. The deadline for a new agreement to replace Kyoto is December 2009.
Perhaps Obama could even show up for one of these COP meetings.
Now THAT would send a strong message that change has come to the climate change stage.
That's true, at least, if you believe the New York Times. In an article yesterday, Clifford Krauss took a decidedly dour view of the prospects for renewable energy in the near future.
"The central questions facing renewables now," according to Krauss, "are how long credit will be tight and how low oil and natural gas prices will fall. Oil and gas are still relatively expensive by historical standards, but the prices have fallen by half since July."
Indeed, oil tumbled more than 5 percent Tuesday, according to Reuters, "amid worries a global recession will crush fuel demand, limiting the impact of any supply cuts by OPEC."
U.S. oil for November delivery tumbled $3.98 a barrel to $70.27 by 12:33 p.m., after hitting a session high of $75.69. Natural gas has also pushed down by close to half to $6.79 per thousand cubic feet from $13.58 in early July.
OPEC is set to meet on Friday, which has many analysts scrambling to anticipate what they will do. Some analysts close to the situation cite Iran's assertion that "drop in demand could push OPEC to cut output by 2 - 2.5 million barrels per day, while other members have said a smaller cut may be needed."
Energy analyst Gregor MacDonald is "not convinced they need to cut that much."
"Remember," Gregor wrote in his blog yesterday, "this meme of demand destruction is is very much perception related right now. There is not alot of data to support it. US demand numbers revived very quickly in July and August when petrol prices fell. The new demand data showing US is down again actually has alot to do with people in the South simply being unable to obtain petrol, after hurricane Ike."
The forces do seem to be aligning against alternative energy, despite the $17 billion tax credit rider attached the Paulson-Bernanke rescue blanket.
Seemingly, a perfect storm is brewing against alternative energy development: low fuel prices, lack of credit, and the government shelling out money it doesn't have to shysters and speculators who took on too much risk.
But at the end of the day, we're still going to have several problems with which to deal, including a dwindling and more difficult to access (read costly) oil and gas supply, renewable energy portfolio standards in many states, global pressures to deal with greenhouse gas emissions, and continued increases in global demand for energy.
Unlike the collapse in oil prices in the 1980s, when the nascent renewables market evaporated, renewable energy today is a big business. The total investment in the sector increased to $148.4 billion last year, according to a New Energy Finance analyst quoted in the Times.
While this year investment is likely to be lower than last, the upward trend may be hard to stop.
And if you think low oil prices are be back to stay? Think again, says MacDonald.
"Already, these price levels around 70.00 are the set-up to a new price high next year," MacDonald writes. "At 100.00, we can have lots of steady supply without much need to go higher. At 70.00, supply is killed off and then we ramp again. Next time above 150.00."
John Whitehead, a professor in the Department of Economics at Appalachian State University, thinks that it's essential we price nonrenewable energy in a way that accounts for the associated negative externalities. He suggests, as others have, that cap-and-trade or a carbon tax can "keep the demand for renewable energy going strong."
"Since we can't much afford renewable energy subsidies with a big budget deficit," Whitehead writes. "I will go so far as to say that high nonrenewable prices are the only way to reach the point where we significantly shift to renewable energy."
But others argue that cap-and-trade and carbon taxes are market distortions (although the subsidies fossil fuels have been receiving for years may be equally so) and, in the end, will do little to spur the level of economic activity that is needed.
A temporary slip in oil prices, however, that leads to a higher spike may shift the floor yet again.
"Let's make this simple," Gregor writes. "If OPEC cuts big and gets the price back up to 90.00 or 100.00, then the chances of a new price high in oil next year will diminish. But if price, for whatever reason, stays at 70.00 into the middle of Winter, then prepare for 160.00 by next August."
And this time, it may just be game-changing levels in favor of the new green economy.
Steve Rayner, climate policy expert and lead author of The Wrong Trousers: Radically Rethinking Climate Policy(PDF), is featured in this month's Wired Magazine. He's on the "2008 Smart List: 15 People the Next President Should Listen To" (no matter who wins).
Read this carefully, for Rayner is onto something. He declares that cap and trade won't work and that new technology investment is critical. Here is Professor Rayner's letter:
Mr. President:
The outgoing administration failed to come to grips with climate change out of fear that reducing greenhouse gas emissions would damage the economy. But the decision to deal with climate change doesn't lend itself to cost-benefit analysis. It is a strategic choice, like the decision to get married. You have an opportunity to define the nation's character and upgrade its infrastructure -- and bold action would be consistent with America's historical role as a leader in innovation. It would also encourage India and China to participate in the effort. Here are a few points to keep in mind.
Cap and trade won't work. The market for carbon offsets is widely touted as the best way to curb greenhouse gases. This would be fine if time were unlimited. However, the best available science suggests that we need to stabilize emissions by mid-century. That's too soon for carbon prices to rise enough to drive the R&D necessary to enable cleaner alternatives to compete with fossil fuels. It doesn't help that the cap-and-trade approach relies on underdeveloped monitoring and accounting systems that inevitably leave plenty of wiggle room for unscrupulous speculators to work the system, amassing fortunes while achieving nothing for the atmosphere.
New technology is critical. The only plausible way to curb emissions in the next few decades is to accelerate the development and adoption of low-carbon energy sources. Rather than setting targets for greenhouse gases, we should establish goals for installed technology, beginning with the most energy-intensive sectors, like electricity generation, ground transportation, and cement manufacturing. Similarly, international cooperation on emissions reduction should focus on the handful of countries responsible for the lion's share of the problem. In the US and elsewhere, R&D funding should be directed toward technologies that otherwise might not come online for up to 20 years. This would fill the gap between the turnaround timeline for venture capital (three to five years) and for basic research (beyond 20 years).
Let the market decide. No amount of public investment will succeed if politicians are allowed to pick the winners. The program must be designed to widen the choices available to the market, not to preempt them. There is no silver bullet, but we can develop silver buckshot. The point is to ensure that money flows to a variety of options from which the market can select, not just the one that's being developed in the district of a powerful member of Congress.
Mr. President, this strategy is not just about throwing money at the problem. It will be necessary to review a wide range of policies that affect technology development and deployment, including intellectual property, defense procurement, taxation, and performance standards. Moreover, stabilizing the atmosphere does not address the legacy of past emissions. It is equally important to invest in infrastructure that will head off damage from extreme weather events caused by the climate change we've already set in motion.
Twice in the past century, the US dragged its feet before confronting threats to our civilization in the form of two world wars. But when it finally committed itself, it shot straight into the leadership position and dealt decisively with the problems. Climate change poses the same sort of challenge -- and opportunity -- at the beginning of the present century.
Sincerely,
Steve Rayner
Steve Rayner is Professor of Science and Civilization at Oxford University.
Reggie Jackson may have been Mr. October, but there's a new RGGI in town.
The states participating in the Regional Greenhouse Gas Initiative (RGGI) recently announced that the auctioning of carbon dioxide (CO2) emissions allowances in North America is off to a strong start.
All of the 12.5M allowances offered for sale on September 25, 2008 were sold at a clearing price of USD$3.07 per allowance, which is about 65 percent more than the minimum set price of $1.86. $2 per ton had been a reasonable estimate of what a RGGI CO2 allowance is really "worth" in 2009, according to energy consultants at Webb, Scott & Quinn.
RGGI, Inc. reports that 59 participants from the energy, financial, and environmental sectors took part in the first-in-the-nation auction, starting the first of many CO2 allowance auctions.
Demand for the allowances appeared to have been strong with a total of 51,761,000 allowances demanded or four times the available supply for this first auction.
The USD$38.5M in proceeds produced from the auction will be distributed to Connecticut, Maine, Maryland, Massachusetts, Rhode Island and Vermont, the six RGGI states that offered allowances for sale during the first auction. The states are expected to invest those funds in energy efficiency and renewable energy technologies, along with programs to benefit utility rate payers.
Pete Grannis, Commissioner of the New York State Department of Environmental Conservation and Chair of the Regional Greenhouse Gas Initiative, Inc. "RGGI’s example shows that an open and competitive carbon market can be implemented."
Any CO2 allowances purchased at the first auction can be used by a regulated facility for compliance in any of the RGGI states, even if that state did not offer allowances in the first auction. Four out of the ten did not participate in this first auction.
The next allowance auction is set for December 17, 2008. These early auctions, combined with the others being held in the first compliance period, according to RGGI, will ensure an ample opportunity for bidders to obtain the allowances they will need for compliance across the entire 10-state region. RGGI intends to hold quarterly auctions during the first RGGI three-year compliance period, which runs from January 1, 2009 to December 31, 2011.
James Letzelter of Webb, Scott says that "RGGI is indeed a real cost. At $3 per ton, a 10,000 Btu/kWh coal plant faces about $3 per MWh. A 7,000 Btu/kWh gas-fired combined cycle faces a cost of about $1.50 per MWh."
While that's not onerous, Letzelter concludes, "these prices will increase power market prices slightly (figure about $1.50 per MWh). Count that as "RGGI Bonus" revenue picked up by all market players, especially nuclear, hydro and renewable players with no RGGI costs."
The Regional Greenhouse Gas Initiative (RGGI) is the first mandatory, market-based effort in the United States to reduce greenhouse gas emissions. Ten Northeastern and Mid-Atlantic states will cap and then reduce CO2 emissions from the power sector 10 percent by 2018.
Image by Getty Images via DaylifeThis is not a political blog and I am not going to make an endorsement of either the Obama-Biden or McCain-Palin ticket. (Not yet, anyway.) Cop-out? Nada. Why?
I am decidedly Independent, with a capital "I." I've never been a party man and have never voted a straight party ticket or platform. I have friends on both sides of the aisle -- and more who are in the middle, like the majority of Americans. I have both moderate-Republican (Teddy Roosevelt is my favorite president) or Reagan-Dem leanings (Lincoln and Jefferson share second place).
I believe in free and fair trade; am for free market capitalism and early supports (credits, incentives) for market creation. I think the playing field should be level; so, if we're going to give huge subsidies to one group in a sector, the others should be given the same or similar benes, or no one should. I believe in the production tax credit and am against a windfall profit tax (better to just get rid of the oil subsidies).
I am a globalist who wants to see America lead the new green economy. I believe the US was right not to ratify Kyoto Protocol without concessions from China and India; but I also believe that those countries deserve to accelerate their economies by virtually any means necessary to get their people out of poverty. (And further, I think they can leapfrog their way to it without destroying their environment.)
I also believe that we need a multitude of solutions, what British economists Gwyn Prins and Steve Rayner called a "silver buckshot" rather than "silver bullet" approach to energy independence and reducing climate change risks and impacts.
That means wind and nuclear; solar and natural gas; biofuels and clean coal; cellulosic and corn-based ethanol; smart grid and more oil drilling; it means hybrid electric vehiclesand stricter CAFE standards; it means a tax credit for R&D and promoting energy efficiency.
In other words, as is true with my politics, it's not an either/or question, but an and/both question.
Which is why I was intrigued by Neal Dikeman's assertion in his Cleantech Blog that the McCain-Palin ticket is the best choice for cleantech investors.
Wow, how can that be? From what I've heard, Obama has the most aggressive energy plan going. He will (according to his website)
Provide short-term relief to American families facing pain at the pump
Help create five million new jobs by strategically investing $150 billion over the next ten years to catalyze private efforts to build a clean energy future.
Within 10 years save more oil than we currently import from the Middle East and Venezuela combined.
Put 1 million Plug-In Hybrid cars -- cars that can get up to 150 miles per gallon -- on the road by 2015, cars that we will work to make sure are built here in America.
Ensure 10 percent of our electricity comes from renewable sources by 2012, and 25 percent by 2025.
Dikeman calls Obama's plan the "shiny copper penny" plan, by which he may be referring to the negotiator's art of persuading your opponent to take the nice shiny copper penny and give you the wrinkled old paper money, which has more value.
His conclusion? That while Obama's plan is indeed the most aggressive, that is also one of its faults. Dikeman argues that Obama's plan puts green goals ahead of costs to the economy or the American people and has the US tackling climate change solo, rather than bringing the world together to solve it.
He also notes that Obama has a "very limited resume of actually authoring any legislation on energy or the environment; no experience in domestic energy policy; and was anti-drilling (or was until he realized that like two-thirds of Americans support it)."
Obama, in Dikeman's view "supports [a] climate change plan that would represent a wealth transfer from the central US to the coasts and result in a several hundred billion dollar per year new tax on energy (that's on the order of the Iraq war size)."
Creating a permanent Tax Credit equal to 10 percent of wages spent on R&D;
Proposing a Cap-and-Trade system that sets limits on Greenhouse Gas Emissions while encouraging development of low-cost compliance options;
Greening The Federal Government A Priority Of His Administration.
Move The United States Toward Electricity Grid And Metering Improvements To Save Energy.
Addressing Speculative Pricing Of Oil , but not imposing a windfall profits tax.
Dikeman's conclusion? McCain's "energy plan is balanced, focuses on the force multiplier's like R&D tax credits, batteries, and smart grid, and cleaning up cheap domestic resources like gas, coal, nuke, and ethanol, not the shiny copper pennies like a US Venture Capital Fund, PHEVs, and cool sounding names like 25x25." (Wow, tell us how you really feel, Neal!)
He also notes that McCain is the "only candidate to actually author a climate change bill...[and has] picked a VP with lots of domestic energy experience (the state of Alaska is basically an oil company) who while pro drilling is not pro Big Oil."
Where Dikeman faults McCain is for his spotty legislative record on environmental protection and the fact that he hasn't pushed CAFE to the extent that he should. McCain could also be more aggressive on the production tax credit, according to Dikeman; where Obama supports a five-year extension.
The bottom line, according to Dikeman, a founding partner at the boutique merchant bank focused on cleantech sector, Jane Capital Partners LLC, and chairman of Cleantech.org, is that McCain's plan gets "the crown on energy and cleantech, because it's real and focuses on the long term force multipliers that will keep us competitive, clean and safe in the most economic manner, not Obama's shiny copper penny plan."
Mark Burget, Chief Conservation Programs Officer of the Nature Conservancy announced his departure last Friday. It came as a surprise to me, as it may have to others, because, frankly, Mark is one of those people who personifies the Conservancy.
The core values of TNC are integrity beyond reproach, respect for people, community, and culture, and commitment to tangible, lasting results; all of these can be used to describe Mark. Oh, and one other: "One Conservancy," which was John Sawhill's way of saying a collaborative spirit that works for the whole of the organization, not just its parts.
In fact, Mark always kept the whole of conservation in mind when he set strategy, whether as program director for the Upper Colorado River Basin, state director in Colorado and California, or in his more global responsibilities over the past few years.
And I gather it is this consideration of the whole that is once again in his mind as he decided to leave TNC. He is heading to ClimateWorks, a San Francisco-based non-profit that is focused, as Mark put it in his letter to colleagues, "on the most pressing environmental issue of our time: the need to dramatically reduce the greenhouse gas emissions that threaten to disrupt and destroy the miracle of life and the human experience on Earth."
TNC will miss Mark's leadership, vision, and sheer brilliance -- he is one of the most thoughtful and strategic thinkers in the field of conservation. But Mark would not have made this decision without a whole lotta soul-searching. I applaud Mark's decision and will look forward to his success at ClimateWorks.
Mark Burget joined the Conservancy in 1992 as the Program Director for the Upper Colorado River Basin. He earned both his J.D. and M.B.A. from the University of Virginia and his BA in Government from Dartmouth College. Since joining the Conservancy, Mark has held several leadership positions including Director of the Colorado Program, Director of the Global Priorities Group, and most recently Director of the California Program. Mark assumed his current position as Chief Conservation Program Officer in 2007 and leads the Conservancy’s eight conservation regions worldwide.
No matter what your company does or where it's located Climate Change is going to have an impact on your business.
As CEO, it is imperative you understand the potential impacts and opportunities presented by the issue.
But with the tremendous amount of noise out there, on both sides of the issue, it may be difficult to sift through it to find the right information to inform your business decisions and strategy.
Short enough to read on your next transcontinental or international flight, this book provides all the background, current thinking about impacts and opportunities, and upcoming policy decisions that will affect your business.
You will also learn how some of the most successful companies are getting ahead of the game. Companies like SwissRe, which has come up with a three-tiered approach to reducing greenhouse gas emissions (GHG), or Duke Energy, which is anticipating regulations to come and making sure they have a seat at the table when they are secured.
Beginning with understanding your company's carbon footprint and taking action to reduce its size, Hoffman and Woody walk you through assessing the business opportunities and how to influence policy as it's being developed.
"Some business associations and lobbyists still dispute the science of climate change, but their numbers are dwindling," the authors conclude. "And businesses themselves are focusing on the undeniable economics of the problem. While some companies are adapting out of near-term operational necessity, others are acting to mitigate long-term strategic vulnerabilities, and the most forward-thinking are seizing on new business opportunities created by climate change and devising ways to make money from clean energy and efficient technology."
Pick up Climate Change: What's Your Business Strategy? and read it, have your management team read it, and then decide what your company needs to do to stay ahead in the game.
US companies and State governments are not the only ones trying to get ahead of the curve on greenhouse gas emissions (GHG). Industries in developing countries like Brazil and India are also getting in the game.
WRI announced today that it is launching a new program in India to help companies from a range of industries, including cement, pharmaceuticals, and engineering, address greenhouse gas emissions.
"The India Greenhouse Gas Inventory Program will allow our companies to consistently and credibly monitor their emissions," said Mr. K P Nyati, Principal Advisor, Confederation of Indian Industry (CII), in a press release today.
The India GHG Inventory Program will be implemented by the Sohrabji Godrej Green Business Center (GBC) of CII.
"This new program will help India establish a national model of emissions accounting," said Manish Bapna, executive vice president of the World Resources Institute (WRI). "You can't manage what you don't measure."
WRI partnered with CII-GBC and the U.S. Environmental Protection Agency (EPA) to establish the program, which is modeled after EPA's Climate Leaders.
"By adopting greenhouse gas management strategies that make business sense, India's industry leaders are demonstrating that a healthy environment and a healthy economy can, in fact, go hand-in-hand," Jim Sullivan, director of the EPA's Climate Leaders program, said in a press release issued by WRI.
India ranks seventh in the world in terms of annual GHG emissions and is responsible for nearly 3.6 percent of world emissions. That doesn't sound like a heck of alot, but it is growing with the country's economic expansion.
"A GHG inventory will improve the company's understanding of its GHG emissions profile and thereby its potential GHG liability or exposure in a carbon constrained economy," noted Mr. A. K. Kaul, Ex-Chairperson, CII Delhi State Council.
Mind you, as a developing country, India has no GHG reduction obligation under the Kyoto Protocol. Corporate GHG reporting is also voluntary, but is becoming almost de rigeur as industry tries to grapple with the potential impacts of climate change on their businesses.
Smart companies are choosing to inventory their emissions and areas of possible efficiencies, which may also improve their bottom line.
India's program is similar to one recently launched in Brazil and is based on the standardized framework of the GHG Protocol.
The GHG Protocol was created by WRI and the World Business Council for Sustainable Development (WBCSD) and is considered the global standard for accounting of GHG emissions by governments, businesses, and other organizations.
WRI reports on a new study by the Corporate Register, which found that sixty-three percent of Fortune 500 companies use the GHG protocol to disclose their emissions.
The roster of member companies of the India GHG Inventory Program sports some big names in Indian businessn including Ashok Leyland, Bosch Ltd, Capricon Food Products, Century Rayon, Control Techniques India, Godrej Industries, HIRCO, Infosys Technologies, NICCO Corporation, Tata Power, Tata Iron & Steel, and Wipro.
Funding for the program is provided by the Asia Pacific Partnership on Clean Development and Climate and the U.S. EPA, according to WRI.
A move like this from India, which recognizes that growth doesn't have to come at the cost of the environment, sends a strong message to the rest of the world. India wants to lead.
Entrepreneurs can save the planet, but they need a cap-and-trade system to do it.
That's the premise of Earth: The Sequel, by Fred Krup and Miriam Horn, and published in March by W.W. Norton.
The authors, the head of Environmental Defense and a journalist now working for the same, respectively, argue passionately on behalf of emissions cap-and-trade as the solution to unleashing the entrepreneurial spirit of Americans (and others) to solve the climate crisis.
They also tell the story of some of "cutting-edge" innovators in the clean energy space, people like Conrad Burke of Innovalight, the solar nanotechnology company, Isaac Berzin, the chemical engineer who co-founded algae-farm biofuel developer GreenFuel Technologies, and the colorful Bernie Karl of Chena Hot Springs, who is trying to capitalize on geothermal energy found below the Alaska bush with the help of Fortune 500 company United Technologies Corporation.
The stories are simply told, some of them compelling, some bordering on boosterism, but the focus on entrepreneurs is welcome. There's nary a whiff of skepticism in these pages, however, which read like a virtual catalog of potential clean tech investments.
I realize the authors don't want to back one technology solution over another -- and the new green economy requires not just one silver bullet but a full chamber -- but a little more critical analysis of the full panoply would have been nice (see Pernick and Wilder's The Clean Revolution for more in-depth analysis of the sector).
Private investment is fine, the authors reason, whether entreprenuer or venture capitalist; however, it can't scale without a cap on carbon emissions. In their view, a cap is the only thing that will make alternative energy more affordable to generate. Without it, we will neither reduce emissions enough nor grow the burgeoning clean tech industry.
"To save the planet from calamity," write Krup and Horn, "innovation and deployment of known technologies must occur now at a pace as intense and a scope as vast as the settlement of the western frontier."
Scientists have determined we need to reduce CO2 emissions by 80 percent by midcentury to "stabilize the global climate." According to the authors, "we must produce at least 14 trillion watts of carbon-free energy by 2050 -- about as much power as we now get from the entire fossil energy business" to reach that goal.
The advantage of a cap is that it puts a true limit on total emissions; the problem is it can lead to higher prices for consumers and windfalls for certain companies.
Companies need the stability and predictability of a cap. As Dupont CEO Chad Holliday, whose company is part of a coalition calling for a national cap, says in a quote from the book, "You need some certainty on the incentives side and on the market side, because we are talking about multiyear investments, billions of dollars that will take a long time to pay off."
A national cap would provide that certainty. We just need to make sure it covers all the carbon economy and that the permits are sold not given away free, as in the current European Union scheme. There is even talk of a cap-and-dividend style program that would make equal payments to all Americans (along the lines of the Alaska Permanent Fund Dividend).
"We have before us an extraordinary opportunity," Krup and Horn conclude. "to harness the power of the United States of America's huge and dynamic markets to ensure a safe future...Enacting a cap on carbon will gather U.S. ingenuity and resourcefulness to serve a higher purpose: protecting this planet for generations to come. We have the talent and a brief window of time to create the world of possibilities. All we need is the resolve."
Higher purpose or base greed, I don't care; let's just get moving on the new green economy.
In the end, as NYC Mayor Michael Bloomberg offers in his advance praise blurb, "Earth: The Sequel makes it crystal clear that we can build a low-carbon economy while unleashing American entrepreneurs to save the planet, putting optimism back into the environmental story."
Nicholas Kristof challenges President Bush's latest statement about climate change in today's New York Times. According to his Facebook page, he was inspired to write the opinion piece by a recent study in the journal Nature, titled "Dangerous Assumptions" by Roger Pielke, Jr, Tom Wigley, and Christopher Green.
"Imagine if President Bush announced a plan for Iranian and North Korean nuclear programs that declared: They will cease accumulating nuclear weapons by 2025. We will accomplish this through incentives and voluntary action, without mandates.
"Mr. Bush would be ridiculed, but in essence, that’s the plan he announced for climate change on Wednesday. He set a target for halting the growth in carbon dioxide emissions by 2025, without specific mandates to achieve that, and in the meantime he blasted proposed Senate legislation for tougher measures as unnecessary.
"Unnecessary? When scientists detect accelerating melting in the Arctic and confidently predict centuries of coastal retreats and climate shifts, endangering the only planet we have?"
Kristof closes his piece with a call for a new green economy, even if he doesn't call it that:
"So the next president should start a $20 billion-a-year program (financed by a pullout from Iraq) to develop new energy technologies, backed by a carbon tax and cap-and-trade system. Each of the presidential candidates favors some form of a cap-and-trade and would mark a step forward from President Bush’s passivity — although John McCain’s recent proposal for a summer holiday from the gas tax would be a deplorable step in exactly the wrong direction, unless he hopes to turn his land in Arizona into coastal property.
"The bottom line is that none of the candidates focus adequately on climate change, for this will be one of humanity’s great tests in the coming decades — and so far we’re failing."
On the day that Richard Branson launched the first biofueled airliner, one of my favorite Canadians, the Toronto Star's clean tech writer Tyler Hamilton comes to the defense of the beleagured alternative energy source. It's such a good piece, I have to reblog it in full:
I'm getting tired of the doomsday views being spouted about biofuels lately, as much as there's an element of truth to them. Yes, biofuels from food or dedicated crops aren't a sustainable strategy, and yes, biofuels from cellulosic ethanol may be years away before they become economical, but is this reason to completely abandon the idea? To call it a scam? I'm also a little perplexed that people talk about biofuel like we're pinning the climate's hopes on it, rather than as part of a much larger solution.
Yes, we're seeing the hunt for palm oil sources devastating the rainforests of Indonesian. Bad. Bad. Bad. Makes for a great headline, eh? Does this suggest biofuels per se are bad or that we need to pay greater attention to how and where we get them? Is it not the government of Indonesia that's responsible for strictly regulating this domestic market? It's like saying we shouldn't use solar power because factories in China are using child labour. Solar isn't the problem -- it's the factory owners. Perhaps OECD countries should impose trade sanctions on any country that doesn't comply with strict environmental standards, as a recent BBC article suggests. A New York Times editorial at least sees the potential for biofuels, pointing out that it can be done if done responsibly.
The same reasoning goes for the energy balance of biofuels. We've seen report after report saying that producing ethanol from corn takes more energy than what you get out of it, and that changing lands to biofuel crops releases carbon into the air. This might be the case in some circumstances, but there are some huge assumptions here about irrigation (water use), fertilizer use, transportation, and they are often analyzed out of context -- that is, not compared apples-to-apples to the way we go about exploring, producing, refinining and transporting oil. Again, regulation can deal with these issues.
You think there isn't an army of scientists out there not trying to catalogue the best raw materials for producing biofuels, the best enzymes and bacteria for breaking them down, the best methods of transporting them, ways of growing on depleted lands, etc...? These are early days in the middle of a dramatic transition, and there are going to be some mistakes -- and much trial and error along the way. To suggest this isn't going to happen, and never happened in the early days of oil and coal, is simply naive.
So let's stop demonizing biofuels. It's at times like these that I'm ashamed of my own industry for oversimplifying the debate with sensational headlines. But I digress.
On a related note, I'd like to say I'm happy to see Richard Branson -- media stunts aside -- trying biofuels in airplanes. Virgin Fuels launched the world's first commercial flight powered by biofuel today and the company appears serious about studying the benefits and, based on that outcome, pursuing the biofuel option. Virgin contends biofuels could be a commercial reality in the airline industry within five years. Personally, I think this is an area we must aggressively pursue. In fact, I think we should devote most of our research and development on biofuels to their use in the airline sector.
Here's my reason: We can't run planes on batteries, so electric planes aren't in the cards. We can run vehicles on electricity, starting with plug-in hybrids as a transition, and there is great momentum at the moment toward this goal. It's my belief that a biofuel industry devoted strictly to fuelling air travel could be done sustainably without having an impact on food prices and, as cellulosic approaches become more affordable, by depending heavily on agricultural and forest waste.
Maybe I'm oversimplifying things, but it seems to me it makes more sense to target particular approaches to particular problems rather than have all approaches try to be all things to all industries.
I hope Tyler doesn't mind my reblogging his post from Clean Break. It's such a Green Skeptic viewpoint, I thought my readers would appreciate it.
Reuters reports that US carbon asset manager Natsource LLC has invested in the first forest-based greenhouse gas emissions reductions under California rules.
Natsource paid a private owner of a redwood forest, the Van Eck Forest Project, in Humboldt County, California, represented by the nonprofit Pacific Forest Trust (PFT) for credits representing 60,000 tonnes of carbon emissions.
The company declined to say how much it paid for the credits, but a source familiar with the deal said Natsource bought the credits for "well below" $10 per tonne.
"The deal illustrates the significant role that management of existing forests can play in addressing climate change," according to a press release from PFT. "The transaction is the first commercial delivery of certified emissions reductions under the Forest Protocols adopted last fall by the California Air Resources Board (CARB).
The Protocols represent the only rigorous governmental accounting standards in the US for climate projects embracing forest management and avoided deforestation, while ensuring emissions reductions are real, permanent, additional and verifiable.
"Today marks a significant milestone for the recognition of the real benefits of conserving and managing U.S. forests to enhance their climate contributions," PFT president Laurie Wayburn said in a statement. "Investing in the power of forests to protect our climate is a practical action that can and should be taken now to reduce CO2 in our atmosphere. We are hoping that deals like this will provide policymakers around the world with the confidence they need to ensure that forestry becomes part of the solution to address climate change."
CARB’s leadership in adopting the Forest Protocols is helping to stimulate a new asset class in global Green House Gas (GHG) emissions markets, validating forests as a cost-effective means to achieve real GHG reductions.
The Forest Protocols, which are administered by the non-profit California Climate Action Registry (CCAR), can be used as a model to ensure that forests be used to achieve enduring benefits and become a solution in the fight against climate change.
"Until now, forest sequestration has been an untapped asset in the effort to address climate change," said Jack Cogen, Chief Executive Officer of Natsource. "Forestry can and should be an important part of the portfolio of climate change solutions moving forward. This deal illustrates that when rigorous, clear rules are adopted, these investments can reduce costs for our compliance customers and provide what we believe are attractive investment opportunities.
In voluntary carbon deals, such as this one, payments are made for carbon credits, which investors "store" for the day when US government regulates GHG. That will, in theory, drive up prices for the credits.
Deals like this one are risky, however, as there is no guarantee the US will adopt a GHG regulatory scheme or whether they will recognize early actions.
Critics of so-called "avoided deforestation" argue that it is difficult to prove whether landowners would have protected the forest or slowed its harvest without an incentive. Others argue that it is difficult to measure the CO2 sequestered by a standing forest, with trees at varying levels of maturity, compared to a newly forested area with faster growing younger tree species.
Wayburn argues that paying the land owners to let the forest grow back more fully from the last time it was harvested is a valid option and will conform to the state's rules to ensure the reductions are verified.
Meanwhile, Wayburn told Reuters, "The additional revenue stream allows forest owners to take a long-term harvesting strategy rather than a short-term strategy."
Readers of this blog know that I'm a WB cynic (and I'm not talking the TV network). I'm not much of a fan of World Bank-directed solutions to the world's most pressing problems. If you haven't read White Man's Burden by William Easterly, you should, and you'll understand why.
So perhaps that's why I'm not jumping for joy at the announcement on Friday that "poor countries will soon receive billions of dollars from a new World Bank fund to help them cut pollution, save energy and fight global warming."
Industrialized (or post-industrialized?) countries like the US want developing countries to do their share to dramatically reducing their emissions. Developing countries want financial help to cut their growing emissions. And there's an obvious gulf between the two positions.
I believe developing countries should be allowed to develop their economies without too much interference from the likes of us. That said, why should those same countries have to do it the old fashioned way?
As with mobile phones and wireless networks, we should encourage developing countries to leapfrog tired, polluting and otherwise wasteful technologies for something better, cleaner, brighter -- and maintain their economic growth.
If the World Bank fund focuses on supporting "publicly and privately financed projects that deploy technologies that can cut emissions, increase efficiency and save energy in developing countries," as the US, British, and Japanese finance ministers said in the Financial Times on Friday, then great. If it goes the way of other World Bank interventions, then we're in trouble. At least the WB seems to be learning from its mistakes.
President Bush will cough up some of the US$2bn that he pledged last month to augment the World Bank clean technology fund, which will be combined with US$1.5bn more from the UK, and at least some of the US$10bn that Japan announced in January, according to Hank Paulson and his colleagues Alistair Darling and Fukushiro Nukaga.
"Without moving growth on to a cleaner technology path, climate change could have a devastating impact on the world’s poorest and most vulnerable people," wrote the 3 Tenors of Finance in FT. "The fund will be an important step towards meeting the challenge of creating an environmentally sustainable path to prosperity."
The World Bank says it will establish "a strategic climate investment facility that would accelerate and scale up low carbon and climate-resilient investments in developing countries."
Let's hope the fund focuses on appropriate, local solutions for leapfrogging rather than the large-scale planning exercises we've come to expect from the WB.
Last Christmas, we published this email from Santa, which arrived on the night before the night before Christmas. We had so much fun with it, we thought we'd share it again. Enjoy!
I received this email from Jolly, or not so Jolly St. Nick tonight: --------------- TO: Global Warming Skeptics FROM: Santa Claus DATE: A few nights before Xmas SUBJECT: My Christmas List ________________________________________________
This is Santa, writing from the North Pole. Soon I'll be gathering all the toys for all the good little girls and boys and packing them in my sleigh to begin our journey, our night of nights.
The reindeer, however, are starting to complain about hoof-rot. Apparently, they've been standing around in too much slush. This has put me in a decidedly prickly mood this Christmas.
You know me; I'm not a single-issue guy. I believe that as long as you are good, and I mean good for goodness' sake, you deserve some slack on the other stuff. I'm an equal opportunity distributor. I know whether you've been bad or good or just plain evil. You also know I'm not one to discriminate against one group of people or another, believers or non-believers.
But this year is different. This year, I'm making a few changes to my list. I'm checking it twice and have decided that the naughty include any one of you out there who do not believe in global warming. All you climate change skeptics out there, you are on the naughty list this year.
Oh, you know who you are. And I've got one special gift for you: Nothing but COAL. You like the stuff so much -- and it's such a big part what's leading to climate change -- you might as well have bags and bags of it and nothing more.
No, you don't have to convince me; I'm a believer. All I have to do is look out my window to my back yard, what's left of it! It's a soupy mess out there.
We usually have a good bit of ice up here at the North Pole -- and early. That's important, too; you see, every year the elves and I construct a temporary workshop up here where we make the toys and assemble the other goodies. The earlier the ice, the sooner we get started. Although I have figured out a way to deliver the entire shipment of gifts on my list in one night, I still haven't perfected the manufacturing process. I can't speed it up. (Some of that I blame on the unions.) We need all the ice we can get up here for there is no solid ground.
But this year, the ice cover was the lowest it's been in almost 30 years. And at least one of those science groups studying this stuff tells me that, according to their models, by 2040, we'll have mostly open water up here. (They sent me this short animation clip, which sends chills up my spine: Arctic Ice Melt.)
Mrs. Claus has even started looking for Houseboats on Craig's List!
So, dear boys and girls, you better not pout or cry or whine or deny climate change any longer. And I'm telling you why: because climate change is coming to town. Time's a wasting. We need to do something about this now, before it's too late. Or before I have to move all of my operations to the South Pole!
Here's wishing a carbon-neutral Christmas to all, and to all a good night.
The US Environmental Protection Agency (EPA) rejected the rights of California and 16 other states to set their own standards for carbon dioxide emissions from automobiles.
Claiming federal authority, EPA administrator, Stephen L. Johnson, said the proposed California rules are made moot by the energy bill (HR6) signed into law by President Bush on Wednesday.
According the the New York Times, "The decision immediately provoked a heated debate over its scientific basis and whether political pressure was applied by the automobile industry to help it escape the proposed California regulations. Officials from the states and numerous environmental groups vowed to sue to overturn the edict."
Johnson was quick to defend his agency's decision, stating, "The Bush administration is moving forward with a clear national solution, not a confusing patchwork of state rules. I believe this is a better approach than if individual states were to act alone."
For over two years California, New York, New Jersey, and Connecticut, along with 13 other states have waited as the Bush administration debated the issue of a state's right to adopt stricter air quality standards than the federal government.
The emissions standards California represented GHG emissions cut of 30 percent in new cars and light trucks by 2016, beginning with 2009 models. That's significantly higher -- 43 miles per gallon for cars and some light trucks and about 27 miles per gallon for heavier trucks and SUVs -- than the Energy Bill's 35 MPG.
I always find it interesting that state's rights are evoked inconsistently when its convenient. One wonders whether the Bush administration simply didn't want to be trumped by Schwarzenegger.
"It is disappointing that the federal government is standing in our way and ignoring the will of tens of millions of people across the nation," Mr. Schwarzenegger said. "We will continue to fight this battle."
President Bush is to sign a compromise Energy Bill (HR6) this morning, which will help reduce US dependence on foreign oil and scratch the surface on climate change impacts by cutting about a quarter of greenhouse gas emissions that scientists say the US must slash.
Highlights of the Bill:
-New auto fleets must average 35 miles/gallon by 2020 -- a 40 percent increase in fuel-efficiency standards
-Mandate use of 36 billion gallons/year of ethanol and other biofuels by 2022, a six-fold increase over today's ethanol production.
-Phase-out conventional incandescent light bulbs by mid-teens, replaced with CFs and LEDs.
Those of us interested in alternative energy development were disappointed by the failure of congressional supporters to roll back US$13.5 billion in tax breaks for oil companies. The savings were to be used to create incentives for wind, solar and biomass energy development, as well as energy conservation.
The Bill actually represents the first increase in auto fuel economy since 1975 and the compromises made on both sides represents a true bi-partisan effort. So the House, Senate, and President Bush should be applauded for making this happen.
Compromise is necessary in any negotiation, but in Bali, where delegates from 187 countries met to begin framing a new global warming treaty, the US and EU were holding a staring contest. In the end, everyone blinked.
Meanwhile, in Washington, the Senate settled for a compromise energy bill instead of one that sets out a clear path to a cleaner energy future.
The Bali delegates agreed to negotiate by 2009 a new and more comprehensive global treaty to replace the Kyoto Protocol, which expires in 2012.
The countries pledged to address deforestation, which accounts for one-fifth of the world’s carbon dioxide emissions. There was also a vague offering from China, likely to assume the lead as a producer of greenhouse gas emissions, that they will pursue "measurable, reportable and verifiable" emissions reductions.
The US delegate pledged only to participate in the forthcoming negotiations, but they rejected setting provisional targets for greenhouse gas cuts, and they flat-out refused to commit to reducing their own emissions.
"The Bali road map sets out a process but it doesn't tell us where we'll wind up," head of The Nature Conservancy delegation Andrew Deutz told Asia Times. "The science should have given us a clear picture of where we need to go. But the agreement doesn't paint a picture of the destination."
Indeed, it seems a bumpy road from Bali to Copenhagen, where the final deal will be sealed in 2009.
Despite the drama of extending the meeting by a day, the hard-line stand of the US -- its refusal to accept a target of 25-to-40 percent cuts in GHG emissions by 2020 -- was the headline grabber. It points to a bumpy road ahead, as the US continues to assert its muscle and insists on doing things its way.
White House Council on Environmental Quality chairman James Connaughton is quoted in Asia Times, saying, "The US will lead, and we will continue to lead, but leadership also requires others to fall in line and follow."
Fasten your seat belts; it's going to be a bumpy two-year ride.
Reuters reports that the Bali talks have achieved at least one positive outcome, and it has greens seeing REDD:
Reducing emissions from deforestation and degradation (REDD) is an indicator of the sense of urgency felt by developing nations in the face of global warming.
"The breakthrough might eventually allow poor but forested nations to turn conservation into a tradeable commodity, with the potential to earn billions of dollars selling carbon credits," according to the Reuters article.
"But," Reuters reports, "one of the scheme's key architects warned that, if successful, it will create such large emissions reductions that carbon markets could collapse unless rich nations take on more stringent reductions targets."
Forest destruction produces about 20 percent of human generated carbon dioxide emissions, and groups such as The Nature Conservancy have long argued that forest conservation, also known as "avoided deforestation," is central to reducing emissions globally.
"Deforestation had been left out of previous climate deals," such as Kyoto, "because of concerns about how to work out which trees were threatened, and that any scheme would reward countries destroying forests rather than those protecting their resources."
"'Forests have been the elephants in the corner of the climate change process,' said Andrew Mitchell, executive director of Global Canopy Programme, adding that markets were the only way to find the billions of dollars a year needed to protect forests.
"'We cannot expect philanthropy or governments to come up with this amount of money sustainably,' he said."
(Full disclosure: While with The Nature Conservancy, I was part of its Climate Change Strategy Team, which developed the strategy linked to above. I am no longer employed by the Conservancy.)
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