Environment and Energy

Weekend Reading

Brad Plumer — Sat, 04 Jul 2009 02:13:00 GMT

Fine, you probably want to read about Sarah Palin. But on the off-chance you also want to read a nerdy piece on, uh, climate science, Edge has a terrific in-depth interview with NASA climate modeler Gavin Schmidt, who lays out the history of his field and really delves into the challenges in trying to understand something as complex as the world's atmosphere. If you've ever wondered what climate models do, how they work, what their strengths and weaknesses are, this is definitely worth a click.

--Bradford Plumer

Harry Reid, Not Very Pugilistic Ex-Boxer

Brad Plumer — Thu, 02 Jul 2009 16:57:00 GMT

As everyone's heard by now, the House climate and energy bill passed last week by a narrow 219-212 margin. And by all accounts, Nancy Pelosi's arm-twisting skills were one major reason the controversial bill eked through, as she worked overtime exhorting colleagues to vote for the thing. Here's a typical anecdote from Politico:

One of Pelosi's first targets was Rep. Rush Holt (D-N.J.), a key fence-sitter who wanted more money generated from the carbon trading to be directed to the research and development of green technology.

Pelosi talked to him again and again, but he wouldn't budge. Her message to him was the same as it was to others: It wasn't worth voting against the bill because of what wasn't in it. According to witnesses, Pelosi perched herself on the arm of Holt's chair and went nose to nose with him for a half-hour warning him that his no vote could scuttle the entire climate change effort — and that liberals would have another chance to make their case once the bill came back from the Senate.

Around 2 o'clock, he became a "yes."

You can find similar tales in this colorful Hill piece. At one point, Texas Democrat Lloyd Doggett ignored personal appeals from the White House before Pelosi convinced him to vote yes. Another Texas Dem, Ciro Rodriguez, told Pelosi he'd vote yes, voted no, and then had to sprint out of the chamber to avoid her wrath.

So... next question. Is there a Pelosi-type figure in the Senate? This CQ profile of Harry Reid suggests maybe not:

Reid says he expects the tactic of gentle persuasion to work best, given the size of his Senate Democratic flock and the political divergences within it. "I don't dictate how people vote," he said in an interview this month. "If it's an important vote, I try to tell them how important it is to the Senate, the country, the president ... But I'm not very good at twisting arms. I try to be more verbal and non-threatening. So there are going to be—I'm sure—a number of opportunities for people who have different opinions not to vote the way that I think they should. But that's the way it is. I hold no grudges."

It's not clear Reid's methods are totally ineffective, or—maybe a better way of putting it—that giving everyone the Pelosi treatment would work as well in the Senate. But the contrast in styles is certainly striking.

--Bradford Plumer

Quick Hits: Chestnuts Will Save Us Edition

Brad Plumer — Wed, 01 Jul 2009 23:02:00 GMT

It's been awhile since we had an old-fashioned link roundup, so here are a couple enviro stories from around the Web that caught my eye:

* Nate Silver works his magic to figure out who voted for the House climate bill and why. Most of it's what you'd expect (ideology and the prevalence of carbon-intensive industries in one's district matter a lot), but a few surprises lurk: "Although the nuclear energy lobby is small, and the alternative energy industry lobby is very small, they nevertheless appear to have had some influence"—lobbying for the bill, of course.

* Speaking of K Street, the Center for Public Integrity surveys the feeding frenzy over climate and energy legislation and finds that Southern Company, an Atlanta-based utility with a carbon-heavy fleet, is leading the charge with a staggering 63 lobbyists in tow. Old-school power companies, automakers, and Big Oil still dominate the top ten, although the Environmental Defense Fund had 24 lobbyists and the Solar Energy Industries Association had 24.

* Kevin Drum has a great post on why cost-benefit analysis isn't the best way to think about action on climate change. Economist Marty Weitzman took a similar view in a NBER debate a few months ago, noting that with a few reasonable tweaks of assumptions, you can argue that we should spend anything from 2.5 percent of our income to stop climate change to 99 percent. Of course, we can't just abandon cost-benefit altogether—the best approach is probably to say it's worth considering, but it's not the only thing to consider.

* Kate Galbraith pleads with cliché-mongers to retire the phrase "the Saudi Arabia of…" (As in, "Nevada is the Saudi Arabia of solar!"). She's soliciting replacement ideas.

* With all the squabbling over the climate/energy bill, Mark Muro reminds us not to forget about innovation.

* Can it be? Actual good news about global warming? Maybe! Phil Taylor reports that the lovable chestnut tree, which once dominated the eastern United States before falling prey to a deadly fungus in the twentieth century, could make an excellent CO2-absorber, if scientists can just figure out how to fend off the fungus. Chestnuts suck up carbon a lot faster than walnut or oak trees, and while they can't solve our emissions woes on their own, every bit helps.

--Bradford Plumer

Is A Half-Assed Climate Bill Worth Supporting? Probably.

Brad Plumer — Wed, 01 Jul 2009 16:34:00 GMT

Among people who think we need strong, rapid action to curb greenhouse-gas emissions and avoid dangerous climate change—and I'm one of them—there's been a great deal of hand-wringing over whether or not to support the House climate and energy bill, which is now cruising on over to the Senate.

The warts on the House bill are big and hideous: The renewable-electricity standard would require utilities to do little more than what existing state laws already require. The short-term targets for reducing emissions (nominally 17 percent below 1990 levels by 2020) fall well short of what the IPCC recommends to avert a climate fiasco (try 25 to 40 percent). The carbon cap-and-trade program relies on potentially shabby offsets that could weaken the targets further and will now face even less scrutiny thanks to a last-minute deal Collin Peterson struck on behalf of farmers. And it's quite likely the Senate will produce an even more diluted bill.

Still, in his New York Times column today, Tom Friedman lays out the case for why a watery, badly compromised bill is still better than nothing. Baby steps are important! In particular, Friedman argues that even a modest price on carbon will start steering our slow-turning supertanker of a country in a cleaner, greener direction:

More important, my gut tells me that if the U.S. government puts a price on carbon, even a weak one, it will usher in a new mind-set among consumers, investors, farmers, innovators and entrepreneurs that in time will make a big difference—much like the first warnings that cigarettes could cause cancer. The morning after that warning no one ever looked at smoking the same again.

Ditto if this bill passes. Henceforth, every investment decision made in America—about how homes are built, products manufactured or electricity generated—will look for the least-cost low-carbon option. And weaving carbon emissions into every business decision will drive innovation and deployment of clean technologies to a whole new level and make energy efficiency much more affordable. That ain't beanbag.

Hey, no need for Friedman to ask his gut. As Jon Gertner reported last year, the first item on the wish list of every venture capitalist working in clean tech is a simple price on carbon. Lay that down, they say, and money will start spilling into energy innovation. Likewise, Chuck Gray, executive director of the National Association of Regulatory Utility Commissioners has said that "climate-change legislation is essential no matter what the economic situation," because "it will remove many of the uncertainties that are preventing state regulators, utilities, and others from planning and financing new electricity investments."

One critical point to recognize is that this bill is only a first step. Looking back through history, every single piece of major environmental legislation in the United States evolved in fits and starts. The original Clean Air Act in 1963 dealt rather lightly with air pollution. But it kick-started innovation in scrubber technology and was expanded little by little, in 1965, 1966, and 1967, as awareness of the dangers of air pollution grew. Finally, by 1970, a new, much more comprehensive Clean Air Act was passed into law. (To be sure, that was a somewhat novel situation, as Richard Nixon was jockeying with Congress to see who could support the strongest environmental law.) Similarly, Europe's cap-and-trade system has been bolstered over time, its weaknesses patched, its targets tightened.

It's easy to envision a similar dynamic with global warming. A climate bill will give the Obama administration a better negotiating hand in the international talks at Copenhagen this December. If that helps us persuade China to take bolder action, and if reducing emissions proves as dirt-cheap as the CBO and EPA expect it to be, then combine those two things with the growing body of evidence that the dangers of climate change are more dire than we thought, and there should be fresh momentum down the road to augment and improve climate and energy laws here in the United States.

Indeed, that's essentially what happened with the push to curb CFCs and prevent the destruction of the ozone layer during the 1980s and '90s. As Michael Kraft, an environmental-policy expert at University of Wisconsin recounts, early moves on CFCs were modest, but the Montreal Protocol included a provision allowing countries to revisit the treaty every five years. As the science of ozone-layer destruction became clearer, and as people realized that transitioning away from CFCs didn't cost nearly as much as industry spokesman had warned, it became easier to accelerate the cleanup. "This sort of incremental decision-making is how the United States usually proceeds," notes Kraft.

Now, mind you, we could also see things careen in very much the other direction. It's possible for Congress to design a climate bill so malignant that electricity rates quickly spike, polluters buy up shady offsets by the truckload, and Goldman Sachs makes a fortune manipulating the carbon-trading market. In that case, public support for action on climate change would evaporate. Now, I don't think the House climate bill will lead us to that fate, and neither do the EPA and CBO analyses, but it's a definite concern.

--Bradford Plumer

Ugly Critters Need A Little Love, Too

Brad Plumer — Tue, 30 Jun 2009 22:39:00 GMT

When it comes to saving dwindling species from oblivion, the federal government has actually done a halfway decent job. Since 1973, when the Endangered Species Act passed, more than 1,300 U.S. species have been listed as threatened or endangered, and only nine have totally vanished. Then again, it's also true that only 15 of those listed species have fully recovered—the whole point of the law in the first place. And the species that do recover tend to be cute animals that capture the public imagination: bald eagles, gray wolves, Yellowstone grizzly bears. That hasn't been a coincidence.

David Fahrenthold has a great story in The Washington Post about how, for decades, "charismatic megafauna" got all the love and attention when it came to conservation. Even today, the 50 protected species that get the most funding include eagles, bears, sea turtles—but few plants or insects or crustaceans. And that's a problem, since if you're looking at preserving a broad ecosystem, many of the less-cuddly plants and insects are often underpinning the whole edifice. Recently, however, that bias has started to evaporate—homely organisms like beetles and mussels that are key to a larger habitat are now getting the emphasis they often require.

One ever-nagging question, though, is what happens to all these painstaking conservation efforts if nothing's done to slow the pace of global warming. According to the IPCC, a 3.5°C global average temperature rise would likely kill off 40 to 70 percent of the world's species. According to recent MIT projections, we're on pace for a 5.2°C, rise by century's end, so expect an even higher carcass count. And a new Science study finds that "mass biodiversity collapse" has historically accompanied the sort of increases in carbon-dioxide that we're currently shoveling into the atmosphere. (In case you're curious, yes, this would be terrible for humanity—see this old TNR piece by Jerry Coyne and Hopi Hoekstra.)

In this grim scenario, focusing on "charismatic megafauna" obviously won't accomplish much at all. We're well beyond gray wolves being hunted to annihilation. In fact, even the twentieth-century strategy of trying to cordon off parks and wildlife reserves could prove futile, if temperature increases start shifting entire habitats around. (As one example, the protected areas in Mexico where monarch butterflies spend their winters may soon be uninhabitable as the climate transforms.) So it's worth asking if there's any conservation strategy to stop what would essentially be the sixth mass extinction in world history—apart from trying to curb emissions and prevent large temperature increases. It doesn't appear so.

--Bradford Plumer

Japan Heeds Enviro Criticism. And Russia? Not So Much.

Brad Plumer — Tue, 30 Jun 2009 16:36:00 GMT

Global climate talks tend to involve all sorts of peer pressure. Europe urges the United States to do more. The United States presses China to do more. Developing countries ask wealthy countries to do more. But does all this nagging ever work? Sometimes yes, sometimes not at all. Consider Japan and Russia.

Earlier this month, the Japanese government divulged its plans to cut greenhouse-gas emissions 15 percent below 2005 levels by 2020, an announcement that was greeted with… near-universal derision. After all, those goals are even weaker than U.S. targets—even the much-criticized House climate bill would still cut emissions 28 percent below 2005 levels by 2020.

Now, Japan got a slightly unfair rap, especially since, unlike the United States or Europe, it was planning to meet those targets without relying on (often shady) international offsets. Still, it's true that Japan's new goals were only a fingernail more ambitious than what the country had earlier pledged under the Kyoto Protocol, and they were nowhere near what scientists have deemed necessary to prevent catastrophic temperature rises (for wealthy countries, the IPCC has urged a 25 to 40 percent below 1990 levels).

Turns out, all that criticism may have done the trick. As Noah Buhayar of The Wall Street Journal reports, Japan's environmental minister, Tetsuo Saito, recently said that the country was reconsidering its goals and may seek deeper cuts. On the downside, some of Japan's additional cuts through… international offsets. Still, it's a sign that all this gabbing at all these international forums, however slow and frustrating, might actually work to push countries to do more.

Or at least those countries that mind what the world thinks of them. On the other side, there's Russia, the world's third-largest emitter, which recently announced plans to increase emissions 30 percent by 2020. Dmitri Medvedev argued that doing so would still put his country 10 to 15 percent below its 1990 emissions levels, thanks to the massive shrinkage of heavy industry that came with the collapse of the Soviet Union. That's not promising, though environmental groups just seem pleased that Russia's saying anything at all about the issue and engaging in talks, which was far from assured.

(Flickr photo credit: Avaazorg)

--Bradford Plumer

Fake EPA Scandal Of The Day

Brad Plumer — Mon, 29 Jun 2009 21:38:00 GMT

Earlier this year, when the EPA was putting together its finding that carbon-dioxide endangers the public health, an economist at the agency named Al Carlin drafted a short report disputing the scientific consensus on global warming and asked his bosses to consider it. The bosses heard him out, but decided, in the end, to leave climate science to actual scientists. And with good reason: As NASA's Gavin Schmidt explains, Carlin's "critique" makes a bunch of very basic errors—no surprise, given that he's not a climatologist and was mostly just parroting right-wing pseudoscience.

Anyway, you'd expect the story to die there. Alas, no: The rogue's gallery of climate deniers—from the Competitive Enterprise Institute to James Inhofe—is now shrieking that the Obama administration suppressed The Truth about global warming. Inhofe has ordered a full investigation. You know how it goes. Over at Grist, Jonathan Hiskes has the whole sordid tale if you're in the mood. Personally, I'm holding out for a better fake scandal—this one's a little disappointing.

--Bradford Plumer

Carbon Trading: What Europe Can Actually Teach Us

Brad Plumer — Mon, 29 Jun 2009 20:19:00 GMT

Of all the questions about climate policy, one of the biggest is whether a cap-and-trade system for greenhouse gases will even work. Will it actually and tangibly reduce emissions? The only real-world example we have is the EU's Emissions Trading System, set up in 2005. Conservatives take it as a given that the ETS has failed—see Martin Livermore's Wall Street Journal column last week. But on closer inspection, the ETS seems to be working pretty well after a few early miscues, and there's plenty that American policymakers can learn from Europe's experience.

It's helpful to divide the ETS into phases. In Phase I (2005-2007), the cap only covered about 45 percent of EU emissions, including electric utilities, mining, and the steel and chemical industries. Crucially, according to a 2007 Lehman Brothers analysis, the European Commission had no good data on EU emissions, so they initially relied on industry estimates. As a result, member states gave out way more permits than there was actual pollution—meaning, in effect, the cap was set way too high at first. The price of carbon crashed to nearly zero, and emissions increased in some countries.

In another early stumble, the EU gave away nearly all of the pollution permits for free, rather than auctioning them off. Policymakers hoped that if electric utilities didn't have to pay for their carbon allowances, they would pass the savings on to ratepayers and consumers. But utilities didn't do that. Instead, they jacked up electricity prices and simply kept the value of the permits for themselves, earning windfall profits.

Happily, the United States should be able to avoid many of these blunders. For one, the Energy Information Administration has much more comprehensive data on U.S. carbon-dioxide emissions than Europe did in 2005. And, while the House climate bill only auctions off 15 percent of its allowances, it does give a hefty number to heavily regulated electricity distributors, which are required by law to pass on savings to ratepayers. Some watchdog groups like Public Citizen are worried that these distributors will wriggle free of oversight, and that's a real concern, but in theory, there's a mechanism to avoid windfall utility profits.

Moving on, in Phase II, the EU tightened its caps and started auctioning off a greater chunk of the pollution permits. According to Lehman, once the initial kinks were hammered out, the system "succeeded, and fairly quickly, in imposing a price on carbon." Emissions have now fallen for four straight years. According to the European Environment Agency (EEA), the EU-15 has slashed emissions 5 percent below 1990 levels, and is on pace for a 11.3 percent cut by 2012—easily exceeding the 8 percent goal required by the Kyoto Protocol. Here's a graph:

For the final batch of cuts, the EEA estimates that 7 percent will come from actual reductions, 1.4 percent from stuff like planting trees, and 3.3 percent through clean-energy projects in the developing world. Even if you consider the latter two actions somewhat dubious (I agree), that's still a significant real reduction driven by the cap. And, to be sure, some of the recent drop has been due to the global recession, but not all of it. In 2008, the EU economy shrunk 0.8 percent, but emissions fell much faster—3 percent. The European Commission credits the ETS with much of that drop.

There's also anecdotal evidence that Europe's carbon cap is having an effect. The U.K.-based consulting firm GHK recently studied more than a dozen companies in Europe and found that the cap-and-trade system was driving real changes in business behavior:

The reviewers found that these companies' major moves so far have been aimed at improving energy efficiency. "Energy efficiency is the first thing they look at," said James Medhurst, director at GHK Consulting. Power plants have become more efficient, companies have invested in new fleets of cars, airlines in new planes and transport companies in new trucks. ... [I]n internal operations, these companies have taken widespread measures to substitute high-energy-intensity goods and services with services that burn less energy. ...
As for jobs, the study shows that climate change policies among the companies reviewed have an impact on skills rather than on actual employment levels. "It's essentially a greening of existing jobs," said Medhurst. The researchers found a widespread need for new skills and a general need for upskilling, which companies are attempting to meet by gearing up the introduction of new training programs....
Switzerland-based Holcim (90,000 employees), one of the world's largest producers of cement, told researchers that the E.U. ETS and other market instruments such as the Clean Development Mechanism are key players in driving the company to reduce CO2 emissions. Holcim said it has achieved a 16.3 percent reduction in net CO2 emissions per ton of cement in 2007 from 1990 by optimizing products and processes, and investing in research and development such as bringing out new types of cement and using alternative fuels.

Now, it's true, a few special circumstances have helped Europe meet its targets more easily. Germany is well below 1990 emission levels thanks, in part, to the collapse of Eastern German heavy industry. And Britain's cuts came, in part, because Margaret Thatcher broke the coal-miners' union in the late '80s, which eventually led the country to shift to cleaner natural gas. That said, Europe has long had higher energy taxes and stricter efficiency standards than the United States, so you could argue that we have a lot more fat to trim, and that making initial cuts will actually, in many respects, be easier for us than it was for Europe.

My biggest caveat is that, when you look at Europe's "outsourced" emissions, the picture looks much grimmer. According to the Stockholm Environment Institute, Britain's carbon emissions have actually grown by 20 percent when you factor in imports from China. No domestic cap-and-trade system can fully work unless it's placed in a global context. But on the bright side, an international treaty would also make cutting emissions far cheaper. A recent analysis by PointCarbon found that EU permit prices—and hence the cost of reducing carbon emissions—would drop dramatically if the EU and the United States could link up cap-and-trade systems.

Bottom line: The EU cap-and-trade system suffered a slew of early mishaps, but the United States has been watching and learning, and we should be able to avoid most of those fumbles. What's more, now that the problems have been ironed out, Europe's cap genuinely appears to be working, spurring companies to become more energy-efficient and making meaningful cuts in emissions. That said, the China factor is still huge: Europe obviously can't stop global warming all by itself, and there's no substitute for an international treaty.

--Bradford Plumer

Analyzing The House Vote On Waxman-Markey

Brad Plumer — Mon, 29 Jun 2009 15:57:00 GMT

Over at National Journal, Ronald Brownstein has a great rundown of last Friday's House vote on the Waxman-Markey climate bill. Not shockingly, pure political considerations mattered most: By my count, of the 219 "yes" votes, 198 came from districts Obama won last November. Of the 212 "no" votes, 170 came from McCain districts. Indeed, seven of the eight Republicans who voted "aye" hailed from Obama districts—and some of them, including Illinois's Mark Kirk and Delaware's Mike Castle, are gearing up for a blue-state Senate run. (The only other Republican yes-vote was Mary Bono Mack, who comes from a California district with a ton of renewable energy resources.)

The other big factor was coal, although it seemed to matter somewhat less than the red-state/blue-state divide:

Thirty of the 121 Democrats from states that generate at least 40 percent of their power from coal voted against the bill; just 14 of the 134 Democrats from states that are less reliant on coal joined them in opposition. That means about one-in-four of the coal state Democrats voted no, compared to only a little over one-in-10 of everyone else.

It's actually noteworthy, though, to see how many coal-state Democrats voted for the bill. That's mostly because Henry Waxman and Rick Boucher bent over backward to make concessions for the coal industry—for instance, giving allowances away to local electric-distribution outfits so as to cushion the blow for ratepayers that get much of their power from burning coal. Environmental groups decried these measures, and there's certainly much to grumble about, but given that only a thimbleful of Republicans were going to vote for the bill, it's hard to see how any climate bill ever passes without concessions to coal-staters.

Looking on to the Senate, there are a whole heap of coal-state senators nervous about how a cap on greenhouse-gas emissions will affect their district. As soon as the House bill passed, Claire McCaskill wrote, "I hope we can fix cap and trade so it doesn't unfairly punish businesses and families in coal dependent states like Missouri." As Waxman proved in the House, it's possible to design a climate bill that can allay those concerns and satisfy coal-state Dems. The question is whether there's anyone in the Senate who can handle these delicate negotiations as deftly as Waxman did, while still ensuring that the bill isn't crippled to the point of uselessness.

--Bradford Plumer

Can House Protectionists Strengthen Obama's Hand?

Brad Plumer — Mon, 29 Jun 2009 15:15:00 GMT

John Broder of The New York Times has a story today about a provision in the House climate and energy bill that was tucked in at the last minute, requiring the White House, starting in 2020, to impose a carbon tariff on China or any other country that doesn't adopt its own limits on greenhouse-gas emissions. (The White House would have to get explicit congressional approval to waive these tariffs.) This comes on the heels of a new WTO ruling giving tentative approval to these sorts of border-adjustment taxes.

Officially, Obama is against this provision, saying, "I think we have to be very careful about sending any protectionist signals there." I've written about this before, and I agree: It would be infinitely preferable to cooperate with, say, China on a constructive climate agreement than to strong-arm the country via import restrictions. A global trade war, with tariffs and counter-tariffs and retaliation left and right, really could be disastrous. So I doubt this provision will survive the Senate. (One possibility: Lawmakers would go back to the original language, which gave the White House the option of imposing tariffs, but didn't require it to do so.)

That said, a number of China experts have suggested to me that China's eagerness to talk with the United States about climate change stems, in part, from their fear of a gory trade war. So it's perfectly conceivable that the House may have strengthened the Obama administration's position in its ongoing talks with China. U.S. negotiators can say, "Look, we don't want a trade war, but we're having a hard time restraining Congress, so it's important that we work these issues out before protectionists in the House and Senate do something really stupid."

(Flickr photo credit: Edward Horsford)

--Bradford Plumer

House Climate Bill Squeaks Through

Brad Plumer — Fri, 26 Jun 2009 23:30:00 GMT

The Waxman-Markey climate bill just passed through the House on a narrow 219-212 vote. Eight Republicans vote for it, while 44 Dems voted against it. Here's the roll call. Of course, the Senate's the big mousetrap, and I did a post a few days ago that previewed some of the clashes we can expect to see, both within the Senate, and between both chambers. I'm not convinced this thing is dead in the Senate (more on that later), but it's obviously a much steeper challenge.

--Bradford Plumer

Live, uh, Tweeting The Climate Debate...

Brad Plumer — Fri, 26 Jun 2009 17:44:00 GMT

All right, following Jon Cohn's fearless lead, I'm trying an experiment: I'll be watching the climate bill debate in the House all afternoon and covering it on (oh yes) Twitter. Feed's at @bradplumer.

--Bradford Plumer

Last-Minute Tweaks To House Climate Bill

Brad Plumer — Fri, 26 Jun 2009 16:33:00 GMT

Brad Johnson takes stock of the final version of the House energy and climate bill (well, final unless it gets altered further by whatever floor amendments come up today). As we noted a few days ago, and as Steve Pearlstein discusses today, the bill was weakened slightly to appease Collin Peterson and some of the farm-state Dems. But there were also a slew of additional changes that were made, and many of them actually strengthened the climate provisions in this bill. Among other things, the federal government would be required to get a certain percentage of its power from renewable sources.

In any case, it'd be awfully nice if we had more time to read through this 1,200-page bill before it got voted on. (Sure, most members of Congress won't read it no matter what, but some of us would!) But the House wants to finish this up before they leave for the July 4 recess, so everything's being accelerated.

--Bradford Plumer

Today's Vote, New EPA Analysis, Plus Bonus Infighting...

Brad Plumer — Fri, 26 Jun 2009 16:01:00 GMT

If you're dying to watch the House debate on the Waxman-Markey energy and climate bill this afternoon, it's being televised on CSPAN, with a live feed here. The final vote will likely go down at around 5 today, though I assume that if Pelosi still doesn't have the votes, she'll wait until tomorrow. On that, Politico had a great piece today on the swing-vote Dems who are being pressured in both directions.

On a substantive note, here's a recent EPA analysis of the bill. Everyone wants to know about cost, and, according to the agency's modeling, the energy-efficiency measures for homes and appliances in the legislation will actually lower electric-utility bills 7 percent by 2020. Overall, the average household will likely pay $80 to $111 extra per year by 2020 to reduce greenhouse-gas emissions—mostly in the form of slightly higher prices for energy-intensive goods. That's in line with the recent CBO study finding very small costs for the bill.

And what will the cap on greenhouse-gas emissions do to the nation's energy mix? The EPA expects that coal use will decrease slightly by 2020; carbon capture and storage will become viable by 2015; and about 65 percent of new energy generation built by 2025 will be renewable. Joe Romm thinks the EPA's way too bullish on the prospects for carbon capture and nuclear power, but he also argues that the cost of cutting emissions might be cheaper than the agency predicts, as electric utilities switch from coal to somewhat cleaner natural gas. (A recent study found that the United States may have 30 percent more natural gas than previously assumed, which could have a big impact on emissions.)

Meanwhile, Josh Harkinson surveys the intra-green debate over this bill. Some groups, including Greenpeace and Friends of the Earth, argue the bill's emissions targets are much too weak. According to the World Resources Institute, the bill would cut emissions 17 percent below 1990 levels by 2020 (that's when you include the cap plus complementary measures), while many scientists are urging a 25 to 40 percent reduction. And the bill is riddled with dubious offset provisions, as we've been chronicling. On the other hand, if this bill fails, it's unlikely Congress will touch the climate issue again for years, which could cause the global climate talks in Copenhagen this December to collapse. So a number of green groups believe this is their best shot at a carbon bill—and are hoping it will erect a basic framework that can be bolstered over time.

--Bradford Plumer

Last-Minute Frenzy Before House Climate Vote

Brad Plumer — Thu, 25 Jun 2009 18:41:00 GMT

The House is voting on the Waxman-Markey climate bill either tomorrow or Saturday, which means the Democratic leadership is working overtime to wrench arms and whip up enough votes to assure passage. Darren Samuelsohn takes a peek at those efforts. At the moment, there are 183 or so "yes" votes in the bag, and Democrats need at least 35 more:

Concerns are coming from all corners. Ways and Means Committee member Ron Kind (D-Wis.) said he still wants to see a district-by-district assessment of the climate bill's economic implications, either from the Congressional Budget Office or the Congressional Research Service. "I've got more questions than answers now," Kind said. "I don't know what's going to transpire in the next 24 to 48 hours to move someone like me and others who have equal concerns."

Kind said he was also struggling with how to publicly defend his vote -- should he opt to support the legislation. "It's a big bill," he said. "It's complicated. You've got to be able to explain this in 30 seconds to a minute with folks back home for them to feel comfortable with it. I haven't been able to figure that out yet."...

Amid all the chaos, several top Democratic leaders expect a victory. "I think we're going to have the votes, yes," said Majority Leader Steny Hoyer (D-Md.). ...

Only a handful of moderate Republicans remain in limbo, and none of them are showing their cards yet. "Lot of details, lot of moving parts, doing a lot of listening right now," said Rep. Frank LoBiondo (R-N.J.). "No decision made." "I'm still in the investigatory stages," said Reichert, citing his former line of work as a detective. "We're still in the process of gathering facts. This was a great meeting."

Here's a useful E&E chart listing the definite "ayes," the surefire "nays," and the fence-sitters. The terrain looks favorable for passage, but nothing's certain. Technically, 27 Republicans are "maybes" (and two—Mary Bono Mack of California and Chris Smith of New Jersey—will likely vote yes), although it's doubtful that more than three to five Republicans end up backing the bill. The GOP leadership is working hard to unify the opposition, since they'd like to make cap-and-trade a campaign issue in next year's midterms. See Lisa Lerer's excellent Politico story today for more on the climate swingers.

One thing to watch will be how the House results affect the Senate's calculus on energy issues. In Indiana, for instance, Democrat Barron Hill voted for the bill in the energy committee, while the state's three other Dem representatives—Brad Ellsworth, Joe Donnelly, and Peter Visclosky—are now hemming and hawing. If all or most of Indiana's Democratic delegation votes for Waxman-Markey, that makes it a lot harder for Evan Bayh to oppose a climate bill in the Senate. A similar situation could apply in Ohio and Michigan.

Meanwhile, this afternoon, President Obama held a press conference and strongly urge the House to pass the bill, which he touted as "jobs bill." (Incidentally, Obama's brief remarks, which went light on the dangers of global warming and heavy on the economic upsides of promoting clean energy, pretty closely mimicked a recent Third Way polling memo.) So the White House is going out on a limb for this bill. Plus, there's the usual lobbying onslaught by both greens and industry groups. Kate Sheppard has a great piece on how some environmental groups, dissatisfied with the House bill's weak emission goals, are now hoping to get it strengthened in the Senate...

--Bradford Plumer

How Popular Is Cap-And-Trade? It Depends.

Brad Plumer — Thu, 25 Jun 2009 16:46:00 GMT

A new Washington Post/ABC poll tries to gauge the popularity of a cap-and-trade program for carbon emissions. Ezra Klein made a graph of one notable result:

So most people would be willing to pitch in and help avert a climate crisis if it cost the just $10 per month; but raise that price tag to $25, and they're tapping out. That's good to know. (For reference, the CBO estimates that the cap portion of the House climate bill will cost about $14 per month.) But there's one aspect of this poll I wonder about. Past surveys have found that most Americans haven't the foggiest idea what cap-and-trade is or what it does. So the WaPo/ABC pollsters decided to describe the policy, and then ask people what they think. Like so:

There's a proposed system called "cap and trade." The government would issue permits limiting the amount of greenhouse gases companies can put out. Companies that did not use all their permits could sell them to other companies. The idea is that many companies would find ways to put out less greenhouse gases, because that would be cheaper than buying permits. Would you support or oppose this system?

Now, 52 percent supported the idea, and 42 percent opposed. That's fairly favorable, but the above also seems like an overly convoluted way of describing the policy. Why not just say, "Congress would set an overall limit on greenhouse-gas emissions, and then companies would have to work out for themselves the best way of meeting that limit"? Or something along those lines. You could also come up with a more scary-sounding summary, if you wanted to. But I assume different descriptions would yield vastly different poll results.

--Bradford Plumer

Peterson Relents, Big Climate Vote Set For Friday

Brad Plumer — Wed, 24 Jun 2009 03:09:00 GMT

It would appear that the big Waxman-Markey climate bill will finally come up for a vote on the House floor this Friday. According to Politico, Henry Waxman just banged out an agreement with Collin Peterson, chair of the Agriculture Committee, who's now given the legislation his farm-state benediction. And that means House Dems likely have the votes to pass this sucker.

On first glance, the last-minute deal that Waxman struck with Peterson doesn't look very appealing from an environmental perspective. For one, the USDA will now get primary oversight over what sorts of agricultural projects qualify for offsets under the cap-and-trade program. The EPA will have an undefined role that the Obama administration will have to determine later. (Basically, the EPA takes a much stricter view of what farm projects—from methane capture to no-till farming—actually reduce carbon.)

Waxman also agreed to exempt ethanol from indirect-land-use analysis for five years. In other words, if corn or soy in the United States is grown for fuel and that, in turn, prompts farmers elsewhere to clear a patch of forest and grow their own corn, well, the EPA can't consider that in its assessment of the impacts of ethanol. Joe Romm deems this a minimal concession, since corn-based ethanol is already exempt from this sort of scrutiny, and newer biofuels like cellulosic ethanol—where this rule could do a lot of damage—are more than five years away anyway. That's the optimistic take, at least

Finally, Waxman consented to grab a sliver of the permit money that was slated for renewable energy and give it over to rural coal generators. This won't affect the overall carbon cap, but it's a pretty sleazy giveaway. On the other hand, Waxman really needed farm-state Dems support (since few Republicans will vote for this bill), so he had little choice. More liberal Dems and environmental groups, meanwhile, don't seem interested in playing Peterson's brand of hardball, so it's unlikely the bill will get strengthened. It's also noteworthy that Obama didn't intervene in this last-minute bull session, the way he did earlier when the climate bill was stalling in the energy committee.

--Bradford Plumer

Why Enviro Rules Tend To Be Cheaper Than Expected

Brad Plumer — Tue, 23 Jun 2009 16:23:00 GMT

Yesterday, I mentioned that, looking back historically, pollution regulations often end up costing much less than initially projected. When Congress created a cap-and-trade program for sulfur-dioxide emissions back in the 1990s, for instance, the EPA predicted that permit prices would hover around $750 per ton. Instead, by 1997, they were selling for around $100 per ton. All told, the program ended up costing about one-fourth of what was predicted. The EPA's original forecast was way off. And there are plenty of similar examples.

So when the CBO recently found that the cap on carbon emissions in the Waxman-Markey climate bill would only cost the United States about $70 per person per year by 2020, there's decent reason to think even this modest amount might be an overestimate. But Jim Manzi isn't buying it:

Presumably the same awareness of the track record of asserted prior under-estimation of environmental costs was available to both the EPA and CBO as they prepared their cost estimates. Unless we wish to assert that they are biased or simply irrational, why would we assume they failed to incorporate this information into their (very similar) forecasts of costs by 2020?

This is a good question. If the EPA and CBO and other analysts consistently keep overestimating the cost of environmental rules, why can't they just factor this into their models? Why do they keep making the same mistake? One possible explanation, given by economists Eban Goodstein and Hart Hodges back in 1997, is that these forecasters have a hard time predicting the sorts of technological and market innovations that enable companies to comply with pollution controls so cheaply:

So, for example, the much lower than expected costs for the acid rain program can be explained in retrospect by the increased flexibility that firms were given to achieve their mandated reductions in sulfur dioxide emissions. Rather than install expensive scrubbers (or buy extra permits), many more firms than expected have met their sulfur dioxide targets by switching to low-sulfur coal, or developing new fuel-blending techniques. Railroad deregulation, along with economies of scale, led to an unexpected decline in low-sulfur-coal prices. And with the increased competition from coal, scrubber prices fell by half from 1990 to 1995.
All this is easy to see after the fact, but would have been very hard to predict. Hahn got his 20,000 lost jobs from air toxics regulation following this same practice—ignoring innovative market responses. While parenthetically noting that "technological improvements could reduce the direct economic impacts," the study explicitly ignores the possibility "because of the difficulties in predicting how technology will evolve." Because in the mid- to late 1980s, available control technologies for coke ovens seemed to be quite expensive, Hahn assumed that regulating air toxics would simply shut down much of the industry. ...
Peering into the future is hard work. It is, in fact, close to impossible for economists to predict the specifics of how technology will evolve. This is especially true since much of the information about potential innovations consists of closely held trade secrets, which industry has little incentive to reveal. But basing cost predictions on scenarios that assume no technical evolution is guaranteed to produce gross overestimates. Innovation is indeed something at which markets are very good. When given a narrowly defined task—to produce commodity x emitting less of pollutant y—short-term substitutions and long-term shifts in technology guarantee large cost reductions over current practice.

The basic point is that markets almost always tend to be smarter than forecasters, and adjust in ways that no one expected. (As such, this can be difficult to account for in an economic model.) So, while we have to make policy using the best estimates we have available—and the CBO's approach is highly, highly respected—some additional optimism may, in fact, be warranted. Yesterday, Megan McArdle argued that, "[u]nless Waxman-Markey serendipitously leads to the development of some clean technology that makes carbon obsolete, I'm pessimistic about how much it will accomplish." But that's the whole point of putting a price on carbon. And I wouldn't call it serendipity. If past examples are any guide, there's very good reason to think a climate bill will accomplish exactly that.

P.S. To be clear, the CBO and the EPA do go to great lengths to try to model how markets and technology will react to a price on carbon, and the models keep improving. The CBO explains its methodology here. It's just that, in the past, these predictions have tended to err on the cautious side.

--Bradford Plumer

Psychotic Shark Of The Day

Brad Plumer — Mon, 22 Jun 2009 18:38:00 GMT

As it turns out, great white sharks have a lot in common with Hannibal Lecter. That's according to Seth Borenstein's luridly fascinating AP story today:

Great white sharks have some things in common with human serial killers, a new study says: They don't attack at random, but stalk specific victims, lurking out of sight. ...

The sharks feeding at Seal Island could have just hovered right where the seals congregated if they were random killers-of-opportunity, Hammerschlag said. But they weren't.

The sharks had a distinct M.O.

They were focused. They stalked from a usual base of operations, 100 yards from their victims. It was close enough to see their prey, but not close enough to be seen and scare off their victims. They attacked when the lights were low. They liked their victims young and alone. They tried to attack when no other sharks were around to compete. They learned from previous kills.

We do, however, learn one key distinction: "The great whites attack to eat and survive, not for thrills." Or at least that's what they'd have us believe....

--Bradford Plumer

Razing The Amazon--Not So Lucrative After All

Brad Plumer — Mon, 22 Jun 2009 18:12:00 GMT

Deforestation in the Brazilian Amazon is an ongoing ecological disaster, causing massive biodiversity loss and major carbon-dioxide emissions. But unfortunately, there are also strong economic incentives for rural Brazilians to hack down rain forest. Not only can they make money selling the timber, but they can then raise cattle and plant crops on the cleared land. But here's a question: Has all this deforestation produced any sort of sustained economic growth in Brazil’s hinterlands? A recent paper in Science, based on a study of 286 Brazilian municipalities with varying histories of deforestation, has concluded that it has not. Areas that cut down their rainforest do see a short-term boost in per-capita income, life expectancy, and literacy rates. But once the trees are gone, those gains disappear, leaving deforested municipalities just as poor as those that preserved their forests.

It’s a stunning find. After all, shouldn’t cleared rainforest land that’s been converted to farming or ranching continue to produce income more or less indefinitely? As it turns out, no. Soil in the Amazon region is fairly poor and starts to decline in productivity after a few years of farming. This depletion of the soil is a major reason why per-capita income generally ends up dropping to pre-deforestation levels.

So if deforestation in the Amazon is a lose-lose proposition in all but the most shortsighted of timeframes, what can be done to stop it? There’s no shortage of proposals for forestry-based carbon offsets and other systems of paying people to leave the forest intact. But in order for these payment systems to work, it’s necessary to determine who actually owns which parts of the forest in the first place. In Brazil, that's easier said than done. A recent Economist article cited a study finding that only 14 percent of private land in the Amazon is backed by a secured title. The rest of the privately controlled land in the region is either “owned” on the basis of fake documents or simply occupied by squatters.

The Brazilian legislature recently passed a land-reform law that would attempt to bring some order to this free-for-all by granting formal titles to most of the current occupants of land in the Amazon, while returning the largest squatter-occupied parcels—those in excess of 1,500 hectares—to the government. Brazil’s president, Luiz Inacio Lula da Silva, is likely to sign the bill, though he plans on vetoing provisions that would allow corporations and foreigners to receive titles to Amazonian land. Environmental groups are divided on whether land reform is a good idea. On the one hand, it’s difficult to regulate land use—or incentivize conservation—in the absence of clear land ownership. On the other hand, giving titles to squatters could encourage others to start squatting on remaining government land even deeper into the Amazon.

The key to making land reform work will be figuring out how to keep these future squatters at bay. It won’t be easy: As this New York Times article relates, the Brazilian environmental protection agency is almost comically understaffed for cracking down on illegal logging and settlement in an area as large as the Amazon. But until Brazil can get control of its forest frontier, the environmental devastation will continue, leaving nothing but the same old poverty in its wake.

--Rob Inglis