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Archive for May, 2009

Nature: Hurricanes ARE getting fiercer — and it’s going to get much worse

Sunday, May 31st, 2009

cycloneHurricane season officially begins tomorrow.  So I’m updating one more 2008 post on the science.  Last September, Nature published a major analysis that supports my 2-parter (Why global warming means killer storms worse than Katrina and Gustav, Part 1 and Part 2).  As Nature explained:

scientists have come up with the firmest evidence so far that global warming will significantly increase the intensity of the most extreme storms worldwide.

The maximum wind speeds of the strongest tropical cyclones have increased significantly since 1981, according to research published in Nature this week. And the upward trend, thought to be driven by rising ocean temperatures, is unlikely to stop at any time soon.

The team statistically analysed satellite-derived data of cyclone wind speeds. Although there was hardly any increase in the average number or intensity of all storms, the team found a significant shift in distribution towards stronger storms that wreak the greatest havoc. This meant that, overall, there were more storms with a maximum wind speed exceeding 210 kilometres per hour (category 4 and 5 storms on the Saffir–Simpson scale)….

“It’ll be pretty hard now for anyone to claim that cyclone activity has not increased,” says Judith Curry, an atmospheric researcher at the Georgia Institute of Technology in Atlanta, who was not involved in the study….

“People should now stop saying ‘who cares, storm activity is just a few per cent up’,” says Curry. “It’s the strongest storms that matter most.”

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Van Jones on Clean Energy Jobs from “humble hard-working energy efficiency”

Sunday, May 31st, 2009

greenlanternrebirth6.jpgThe Center for American Progress Action fund had a recent event on clean energy jobs keynoted by Van Jones, who is not the President’s “green-jobs czar,” but “the green-jobs handyman.”

Besides being the administration’s point person on clean energy jobs, he is is the best speaker on the subject — because he studies rhetoric and persuasive speechmaking (see “Van Jones and the English Language“).

So he is worth hearing, and for the video click here, which is where the rest of this post was first published.

“[The report] ‘Green Jobs/Green Homes New York’ looks at the big picture [of retrofitting homes for energy efficiency] and all the dynamics that are impacted and influenced. It speaks to the boldest and greenest terms of community, making sure that those who are the weakest amongst us will have that hope of growing out of poverty,” said Rep. Paul Tonko (D-NY) at CAP Action’s Friday event “Green Jobs/Green Homes New York: Expanding Home Energy Efficiency and Creating Good Jobs in a Clean-Energy Economy.”

Keynote speaker Van Jones, Special Advisor for Green Jobs, Enterprise, and Innovation at the White House Council on Environmental Quality, also addressed the new report from the Center for American Progress, the Center for Working Families, and Half in Ten. CAP Action Senior Fellow Bracken Hendricks moderated a follow-up panel discussion with New York State Laborers Local 10 Community Affairs Officer Lavon Chambers, Half in Ten Campaign Executive Director Lisa Donner, Conservation Services Group Senior Vice President Mark Dyen, and Center for Working Families Director of Green Policy Emmaia Gelman.

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Has Obama saved Detroit from itself — or is that simply impossible?

Saturday, May 30th, 2009

You’re all gonna own a part of GM, so please, fellow owners, let me know what you think!

peak_oil2.jpg

Readers of Climate Progress understand two inescapable realities that the overwhelming majority of policymakers, the status quo media, and the car companies (with one exception) do not:

  1. Peak oil is inevitably going to drive up gasoline prices to record levels within a few years, driving an inevitable switch to much more fuel-efficient vehicles and non-oil-based alternative fuels, of which by far the cheapest per mile is electricity.
  2. Avoiding catastrophic global warming requires sharp increases in fuel economy and a switch to low carbon fuels — of which there is only one available in quantity:  electricity (as explained here).

Reality #1 is a more imminent day of reckoning for the car companies.  After all, the only way to stop oil demand from outstripping the peaking of oil production is massive demand destruction, which is itself possible in only two ways.  The first way, pursued by the Bush administration, albeit (mostly) unintentionally, is to destroy the global economy.  Let’s call that the short-term “non-optimal” approach.

But in the medium and long term, for oil to be significantly below $200 a barrel and gasoline to be significantly below $5 a gallon in 2020 would take a miracle — or rather 6 miracles see “Science/IEA: World oil crunch looming? Not if we can find six Saudi Arabias!” and “IEA says oil will peak in 2020“).  See also “Merrill: Non-OPEC production has likely peaked, oil output could fall by 30 million bpd by 2015,” which noted,

Steep falls in oil production means the world now needed to replace an amount of oil output equivalent to Saudi Arabia’s production every two years, Merrill Lynch said in a research report.

A March McKinsey report concluded, “the potential looms for liquids demand growth to outpace supply creating a new spike in oil prices as soon as 2010 to 2013, depending on the depth of the economic downturn.”

Heck we’ve hit $65 a barrel and we’re still in the middle of the worst global economic collapse since the Great Depression.

Detroit has not only willfully ignored the obvious oil and climate trends as evidenced by the cars they sell (or, rather, used to sell) — but they actually joined with conservatives in blocking every major attempt by progressives to help them develop cleaner cars and to require they build more fuel-efficient cars (see “Why bail out the car companies when they bailed out on us?“)

The Obama administration certainly understands that “the equivalent to Saudia Arabia’s production every two years” can’t be found underground.

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GOP wants 100 new nukes by 2030 while “Areva has acknowledged that the cost of a new reactor today would be as much as 6 billion euros, or $8 billion, double the price offered to the Finns.”

Friday, May 29th, 2009

In Finland, around the globe, and in every state, the nuclear industry makes people sing the same old song:  “What do you get when you buy a nuke? You get a lot of delays and rate increases….

This year, authorities permitted Florida Power & Light to start charging millions of customers several dollars a month to finance four new reactors. Customers of Georgia Power, a subsidiary of the Southern Co., will pay on average $1.30 a month more in 2011, rising to $9.10 by 2017, to help pay for two reactors expected to go online in 2016 or later.

As an aside, if Public Utility Commissions allowed on-bill financing of energy efficiency, which is under half the cost of any new power generation — and 5 times cheaper than new nukes — we could stop electricity demand growth in this country for two decades while lowering consumer electric bills by tens of billions of dollars a year (see “Energy efficiency is THE core climate solution, Part 1: The biggest low-carbon resource by far” and “Part 3: The only cheap power left“).

Back to the delays and high cost of new nukes.  It isn’t just this country (see “Turkey’s only bidder for first nuclear plant offers a price of 21 cents per kilowatt-hour“), and, of course, Finland — see my February post, “Nuclear meltdown in Finland” and today’s remarkable New York Times story (excerpted above):

In Finland, Nuclear Renaissance Runs Into Trouble

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Energy and Global Warming News for May 29: Global warming causes 300,000 deaths a year. Global warming must stay below 2C or world faces ruin, scientists declare.

Friday, May 29th, 2009

Global warming causes 300,000 deaths a year, says Kofi Annan thinktank

Climate change is already responsible for 300,000 deaths a year and is affecting 300m people, according to the first comprehensive study of the human impact of global warming.

It projects that increasingly severe heat waves, floods, storms and forest fires will be responsible for as many as 500,000 deaths a year by 2030, making it the greatest humanitarian challenge the world faces.

Economic losses due to climate change today amount to more than $125bn a yearmore than the all present world aid. The report comes from former UN secretary general Kofi Annan’s thinktank, the Global Humanitarian Forum. By 2030, the report says, climate change could cost $600bn a year….

Civil unrest may also increase because of weather-related events, the report says: “Four billion people are vulnerable now and 500m are now at extreme risk. Weather-related disasters … bring hunger, disease, poverty and lost livelihoods. They pose a threat to social and political stability”.

If emissions are not brought under control, within 25 years, the report states:

• 310m more people will suffer adverse health consequences related to temperature increases

• 20m more people will fall into poverty

• 75m extra people will be displaced by climate change.

Climate change is expected to have the most severe impact on water supplies . “Shortages in future are likely to threaten food production, reduce sanitation, hinder economic development and damage ecosystems. It causes more violent swings between floods and droughts. Hundreds of millions of people are expected to become water stressed by climate change by the 2030. “.

The study says it is impossible to be certain who will be displaced by 2030, but that tens of millions of people “will be driven from their homelands by weather disasters or gradual environmental degradation. The problem is most severe in Africa, Bangladesh, Egypt, coastal zones and forest areas.”

See also “Memorial Day, 2029” and The Lancet’s landmark Health Commission: “Climate change is the biggest global health threat of the 21st century”

Global warming must stay below 2C or world faces ruin, scientists declare

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Big oil made $600 billion under Bush, but invested bupkis in clean energy, Part 2: Details on BP, Chevron, Conoco Phillips, Shell and ExxonMobil

Friday, May 29th, 2009

In Part 1, Center for American Progress’s Dan Weiss and Alexandra Kougentakis pointed out that despite green marketing campaigns, oil companies are investing just four pennies on clean energy for every dollar of profit. This post, first published  gives five short case studies of how the major oil companies have consistently cut investments in clean energy and continued to violate basic environmental quality laws while lining the pockets of executives and shareholders (see also “Shell shocker: Once ‘green’ oil company guts renewables effort).

BP

BP has an entire division devoted to “alternative energy.” Investments include biofuels, solar energy, wind energy, hydrogen power, and carbon capture-and-sequestration. The company’s most recent sustainability report pledges to invest $8 billion over a period of 10 years in alternative and renewable energy technologies. This $800 million annual investment is a paltry sum compared to the $125 billion made since 2001.

bp logo

SOURCE: AP/Charles Dharapak

Recently, employees in BP’s renewable energy division in the United Kingdom were laid off with the cancellation of several clean energy projects, such as two power plants that would have captured and stored their carbon dioxide emissions. It is expected that global operations will be affected as well, and proposed wind farms in the United States may be delayed. Interestingly, the apparent investment caution has not prevented BP from pursuing a tar sands project in Canada, announced at the end of 2007.

Oil from Canada’s tar sands is the most expensive form of crude oil to produce. The extraction and conversion of tar sands to a usable energy source can cause as much as five times the greenhouse gas emissions compared to conventional crude oil. Contamination of waterways by pollution from tar sands development is suspected of causing bizarre mutations of marine organisms. The pollution from these developments is also suspected of causing the high cancer rates and other health problems in the surrounding areas.

BP recently agreed to pay $180 million to settle a lawsuit filed by the federal government for “putting air quality and public health at risk.” BP’s refinery in Texas City, TX, violated federal health safeguards for benzene, asbestos, and ozone-depleting chemicals. The settlement includes the installation of pollution controls to the refinery as well as a civil penalty and for a pollution reduction project.

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Climate politics scoop and question of the week

Thursday, May 28th, 2009

Okay, I don’t know if it is a scoop, heck, I don’t know for certain it is true, but  very reliable source tells me that speaker Pelosi wants the climate bill on the House floor the last week in June.

That is consistent with what Steny Hoyer (D-MD) said (see “House Majority Leader says climate bill will see fast action“).  But it will require a lot of speedy deal-making.  Still, it suggests the speaker does not see any deal breakers in the path to House passage, even though, as Wonk Room reports, “Brown Dogs Poised To Block Green Economy Legislation.”

And Sen. Boxer (D-CA) can certainly get something close to the Waxman-Markey bill out of the Environment and Public Works (EPW) Committee by the fall.  And let’s assume for now it doesn’t get mired in any other committees

And that brings me to the climate politics question of the week:

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Yes, the House climate bill helps make a deal with China possible, and yes, the New York Times got the story wrong

Thursday, May 28th, 2009

We have a real chance of a deal with China before the big international talks in Copenhagen this December (see “Exclusive: Have China and the U.S. been holding secret talks aimed at a climate deal this fall?“). But it won’t be easy, especially since the 2020 target in the Waxman-Markey climate bill falls far short of the 40% cut from 1990 levels that China recently demanded developing nations achieve by 2020.  A confused New York Times story yesterday noted, “A leading Beijing expert on climate change economics, Zhang Shiqiu, said Wednesday that she was optimistic that the two nations would reach some accord on global warming before the Copenhagen meeting,” but then misreported, “The Center for American Progress, a Democratic-leaning research organization, said in a report published Wednesday that the House legislation was unlikely to win enough Chinese support for the two nations to present a united front at the Copenhagen talks in December.”  In fact, leading international experts from CAP also believe a deal is doable — and that Waxman-Markey helps — as they explain in a post first published here and reprinted below (along with their response to the NYT).

UPDATE:  The Times has agreed to correct the mistake in their story.  The squeaky wheel does get greased!

We are now entering the six-month period before the U.N. climate change negotiations in Copenhagen, which are intended to hammer out a successor treaty to the Kyoto protocol that expires in 2012. Progress on climate policy domestically will increase U.S. leverage in these talks, but President Barack Obama should look for additional ways to improve the American negotiating position than what we currently have on the table.

In particular we need a better accounting of what the United States—and other countries as well—are doing to achieve meaningful carbon reductions. Importantly, a more detailed analysis would reveal that the American Clean Energy and Security Act, or ACES, recently passed through committee by Congressmen Henry Waxman (D-CA) and Edward Markey (D-MA), would achieve more carbon reduction than first meets the eye.

The soft underbelly of ACES is its 2020 midterm carbon cap targets, which have been assailed by some environmentalists. At 17 percent below 2005 levels these targets apparently give the Obama administration precious little to meet global expectations about U.S. action on climate change. For starters these caps fall below the European Union’s agreed-upon 20 percent reductions below 1990 levels by 2020. If we were to meet our allies at these goals then the European Union will increase their midterm reductions to 30 percent. At its current levels ACES does not trigger this critical shift.

More troubling, there are already clear signs that ACES’s targets are far less than we need to garner China’s full engagement in an international agreement on capping emissions.

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Energy and Global Warming News for May 28th: Exxon Mobil says transition from fossil fuel is century away, China plans tougher fuel standards than U.S.

Thursday, May 28th, 2009

Climate change and peak oil mean nothing to the blinkered, bloated oil behemoth.

Exxon Mobil Says Transition From fossil fuel Is Century Away

Exxon Mobil Corp., the world’s largest refiner, said the transition away from oil-derived fuels is probably 100 years away.

Petroleum-based fuels including gasoline and diesel, as well as hydrocarbons such as coal and natural gas, will remain the dominant sources of energy for factories, offices, homes and cars for decades because there are no viable alternatives, Chief Executive Officer Rex Tillerson told reporters today after Exxon Mobil’s annual shareholders meeting in Dallas.

No surprise that the oil giant spends bupkis on renewable energy — and that, as a different article reports, “Shareholders of Exxon Mobil rejected proposals on Wednesday to prohibit its chief executive from serving as chairman and to increase spending on renewable fuel.”

And here’s another non-shocker.  Tillerson says:

“If we’re going to place a price on carbon, let’s do that in the most efficient way. A carbon tax is more efficient than a tax that’s applied by way of a cap-and-trade mechanism.”

Carbon politics makes strange bedfellows!  see Nobelist Krugman strongly endorses Waxman-Markey: “The claim that carbon taxes are better than cap and trade is, in my view, just wrong.”

And here’s yet another non-shocker from the leading funder of climate denial advocacy over the past decade:

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Robert Stavins: “The appropriate characterization of the Waxman-Markey allocation is that more than 80% of the value of allowances go to consumers and public purposes, and less than 20% to private industry.”

Thursday, May 28th, 2009

… let’s be clear that, first, for the most part, the allocation of allowances affects neither the environmental performance of the cap-and-trade system nor its aggregate social cost….

Third, we should be honest that the legislation, for all its flaws, is by no means the “massive corporate give-away” that it has been labeled.  On the contrary, more than 80% of the value of allowances accrue to consumers and public purposes, and less than 20% accrue to covered, private industry.  This split is roughly consistent with the recommendations of independent economic research.

Some commenters here and elsewhere have described the Waxman-Markey clean energy and climate bill as a big giveaway to polluters.  The most credible progressive experts I know on energy economics dispute that description (see “Preventing windfalls for polluters but preserving prices — Waxman-Markey gets it right“).  Now a more detailed analysis from an unlikely source makes the overall case stronger.

Weighing into the whole debate is Harvard University’s Robert Stavins — who is certainly not anyone’s idea of a progressive economist (see here and here), although he is obviously one of the country’s leading economic experts on cap-and-trade.  I am excerpting most of his long analysis, first posted here:

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Concentrated solar power goes mainstream: Lockheed-Martin to build large CSP plant with thermal storage in Arizona

Thursday, May 28th, 2009

What is the best evidence that concentrated solar thermal power (CSP) aka solar baseload is indeed a core climate solution with big near-term — and very big medium-term — promise?  One of the country’s biggest companies, Lockheed-Martin, with 2008 sales of $42.7 billion, has jumped into the race to build the biggest CSP plant with thermal storage.

http://www1.eere.energy.gov/solar/images/parabolic_troughs.jpg

The CSP market was already exploding (see “World’s largest solar plant with thermal storage to be built in Arizona — total of 8500 MW of this core climate solution planned for 2014 in U.S. alone“).  Now big players are getting on board, as Phoenix’s East Valley Tribune reports:

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Do the 2 billion offsets allowed in Waxman-Markey gut the emissions targets? Part 1

Wednesday, May 27th, 2009

The flaw in the Waxman-Markey bill is not the too-many offsets that domestic polluters are (potentially) allowed to purchase in lieu of actually reducing their own emissions. The flaw in Waxman-Markey is the too-mild 2020 target — a 17% reduction from 2005 levels — which will be so easy to achieve with various low-cost clean energy strategies that it’s hard to see why polluters would avail themselves of the higher-cost offsets option.

Yes, my thinking on rip-offsets has evolved, primarily because I have spent the last few months talking to leading experts, domestic and international, including the chief climate negotiator for a major European country.  Also, I’ve actually started to look closely at the international offsets market — and at how Waxman-Markey would dramatically change the domestic rip-offset market — something that the journalists and think tanks who have written critiques of the offset provisions do not appear to have done.  And I’ve looked closely at the lowest cost clean energy strategies — again, something the critics don’t appear to have done.

Since Waxman-Markey is the vehicle by which President Obama and Congressional Democrats have decided to pursue action on clean energy and global warming — and since it will take all of our efforts just to ensure it is not substantially weakened by the time it reaches the president’s desk — I think progressives need to understand exactly what they are getting here.  More importantly, we need to understand what is worth fighting hardest to preserve or change in the bill, and what is not worth expending significant political capital on.

As I think will become clear, trying to curtail the quantity of offsets allowed in the bill is simply not a high priority (or even medium priority) activity.   Keeping the 2020 target as strong as possible is.

As I wrote back in January, a U.S. climate bill should set a target of reducing U.S. greenhouse gas emissions 20% to 30% below 1990 levels by 2020 (see “Is 450 ppm politically possible? Part 8: The U.S. needs a tougher 2020 GHG emissions target“).  I won’t repeat that science-based analysis here, since, if anything, the science has only gotten more urgent (see recent posts in “Uncharacteristically Blunt Scientists“).  One point I will elaborate on is the assertion from that earlier post that the United States has the technology and resources to reduce its emissions levels substantially below 1990 levels by 2020.

After all, if a much tougher target was straightforward to achieve, then the relatively mild target of Waxman-Markey, which takes us just a tad below 1990 levels by 2020, must be pretty damn easy.  And when you throw in the huge clean energy push in the stimulus, Obama’s aggressive fuel economy standards decision, peak oil, the provisions of Waxman-Markey that accelerate clean energy into the marketplace, and the apparently much greater domestic supply of natural gas than anyone thought even a few years ago — suddenly the target because very easy to meet indeed.

The analysis that I am going to present is not something that any major economic/energy model can reproduce because none of them — including EPA’s — model clean energy well nor are they designed to look at things like the full impact of peak oil or how the electric grid’s dispatch order will change  with even a modest carbon price.  These models have historically overestimated the cost of reducing pollution and are doing so again.  Because there is no reliable model, my analysis is necessarily approximate, and it will take a number of posts to spell out exactly how the U.S. energy and economic systems will respond to Waxman-Markey.  This post will serve primarily as an overview of the key issues of how we will meet the 2020 target.  Later posts will explore individual issues — such as fuel switching from coal to natural gas — as well as what I think will happen in the 2020s and beyond.

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Big oil made over $600 billion during Bush years, but invested bupkis in clean energy, Part 1

Wednesday, May 27th, 2009

[This article is reprinted from the Center for American Progress website.]

It should come as no surprise that last year’s record high oil prices also led to near record profits for big oil companies. The price of oil climbed from January 2 to July 14, 2008, repeatedly setting new price records until it peaked at $147 per barrel—more than twice the price of the previous year. The big five oil companies—BP, Chevron, Conoco Phillips, ExxonMobil, and Shell—made record profits during the first three quarters of 2008 due to these record prices. When oil prices collapsed along with the world’s economies, the oil companies’ profits were reduced, too. However, the big five companies still made a combined profit of $100 billion for 2008 ^ (see note below).  The sum is the second-highest combined big oil profit on record, exceeded only by the 2007 combined total of $123 billion.

The 2008 big oil profits bring the grand total under the two terms of the Bush administration to $656 billion, which is nearly two-thirds of a trillion dollars. Given the urgency to restart the economy with clean energy investments, and the need to slash U.S. oil use, you would expect these wealthy energy companies to be taking steps to develop new clean-energy technologies and fuels to address these economic and security concerns. Despite their soaring earnings, the big five companies were very stingy with investments in renewable and low-carbon energy technologies and fuels that would reduce oil dependence. In fact, a CAP analysis of their investments reveals that the big five oil companies invested just 4 percent of their total 2008 profits in renewable and alternative energy ventures. This reality contrasts with their ads that promote greener, cleaner images.

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Energy and Global Warming News for May 27th — GE plans $1.5 billion in cleantech R and D by 2010

Wednesday, May 27th, 2009

GE eyes $1.5 billion in cleantech research by 2010

General Electric Co aims to boost its investment in clean-tech research and development to $1.5 billion a year by 2010, the largest U.S. conglomerate said on Wednesday in its annual “Ecomagination” report.

The maker of products ranging from electricity-producing wind turbines to energy-efficient compact-fluorescent lights, wants to grow green-business revenues to what it called a “stretch” target of $25 billion next year, up from $17 billion in 2008 and $6 billion in 2004….

GE said it expects stimulus spending in the United States, China and elsewhere around the globe to create about $400 billion of new demand for green technologies and clean-energy products, including wind turbines and solar panels.

The company earlier this month said it was building a plant near Albany, New York to build a new generation of high-capacity batteries that would power its upcoming hybrid railroad locomotive. Last month, it said it was working with Florida utility company FPL Group on the roll out of a “smart grid” system intended to encourage homeowners to lower their electricity consumption during peak demand times.

Global CEOs back greenhouse gas cuts, carbon caps

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UPDATED exclusive report: Preventing windfalls for polluters but preserving prices — Waxman-Markey gets it right with its allocations to regulated utilities

Wednesday, May 27th, 2009

UPDATE:  The authors have clarified a key example with a figure and answered some of the questions, so I’m reposting this:

As the U.S. makes significant progress towards enacting a cap-and-trade system to control greenhouse gas emissions, some are worried that the new Waxman-Markey bill (W-M or H.R. 2454) may enable polluting utilities to reap windfall profits.  We disagree.  The allowance allocation provisions of this bill have been thoughtfully crafted to avoid a repeat of Europe’s experience.  There certainly are issues and challenges remaining with the legislation, but windfall profits arising from allowance allocations isn’t one of them.

So begins an exclusive analysis of Waxman-Markey for Climate Progress by two of the country’s leading experts on the electric utility industry and energy economics, Peter S. Fox-Penner and Marc Chupka.  The debate over the large amount of allowances given to utilities is certainly heated (see “Greenpeace’s indefensible attack on the House clean energy bill perpetuates myths about the European carbon trading system“).  But very few are expert on the economics of regulated electric utilities — including me.  That’s why I asked for this analysis from two former colleagues from the Clinton Energy Department.  Fox-Penner is an internationally recognized authority on electric power industry issues, whose forthcoming book is The Future of Power (Island Press).  He held the position of Principal Deputy Assistant Secretary for Energy Efficiency and Renewable Energy right before I did.  Chupka is an economist with two decades of public and private sector experience analyzing the market impacts of both domestic and international energy and environmental policy.  He was Acting Assistant Secretary for Policy when I was at DOE.  This analysis examines the likely impact of the allowance allocation to utilities and includes an extended Q&A at the end.

The key to W-M’s success in this area is that it is careful to give the overwhelming majority of free utility allowances to the electric or gas retail distribution company, not the generator or the entity that sells wholesale gas or power itself.  Whether or not you have electric or gas deregulation in your state, you still receive your power or gas deliveries from a regulated distribution company.  If you are served by a rural electric co-op they are your distributor, and similarly for a government-owned utility like LADWP.  All distributors are either state-regulated, customer-owned, or government-owned.

While you may not know it, every monthly power or gas bill that customers pay separates the cost of delivering gas or power from making or buying the energy itself.  State regulators, city managers, or coop management boards — who have full access to the accounts of distributors –  set distribution charges so as to manage the profits earned by the distributor.  This is a key point.  Unlike some other parts of the utility industry, distributor profits are strictly controlled.

W-M specifies that the bulk of free allowances given to utilities can be given only to a gas or electric distributor — not to a standalone retailer or generator.  Furthermore, the law says that “the allowances distributed to an electric or gas local distribution company … shall be used exclusively for the benefit of retail ratepayers of such…company.”  Each state regulator or manager of a coop or municipal utility must conduct a proceeding to determine how the value of allowances will be treated – for example some of the proceeds might help fund energy efficiency if the regulators decide that represented benefits to retail customers.  But, W-M does not allow the size of individual customer rebates to reflect that customer’s metered energy consumption.

With these provisions, it will be awfully hard for any utility to harvest a windfall from the free allocations — especially a shareholder-owned utility.  Yes, the free allowances given to the distribution utility will be worth a lot.  But the law is pretty clear that the benefits of receiving the free allowance go to the utility’s customers, not their shareholders.

As folks who’ve been involved in utility regulation for a long, long time, we see this as pretty straightforward and transparent.  State regulators will all know the number of allowances each utility gets and their value. [See the Q and A below for more on this] They will see the accounts books of utilities (as they do today).  To give ratepayers the value of the allowances, they will probably do one of two things:

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Energy Secretary Chu: Paint roofs white to fight global warming

Wednesday, May 27th, 2009

I have been pushing white or reflecting roofs as the lowest cost climate strategy (see “Geoengineering, adaptation and mitigation, Part 2: White roofs are the trillion-dollar solution“).  Indeed, it is almost certainly the single cheapest of the 12 to 14 wedges needed to stabilize near 2°C total warming — the equivalent to taking the world’s approximately 600 million cars off the road for 18 years, while quickly paying for itself in direct energy savings!

cool-roofs.jpg

[100 m2 (~1000 ft2) of a white roof, replacing a dark roof, offsets the emission of 10 tonnes of CO2.]

So I was delighted when a reader sent me this amazing Agence France-Presse story from Tuesday:

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Why future Katrinas and Gustavs will be MUCH worse at landfall, Part 2

Tuesday, May 26th, 2009

Part 1 discussed why global warming means killer storms worse than Katrina and Gustav.  This post looks in more detail at Katrina and Gustav, and why they weren’t as strong and hence as devastating at landfall as they could have been.

My key point here is one that is rarely discussed in the literature dealing with global warming and hurricanes: All things being equal, if a storm taking the same track of Gustav (or Katrina) occurred in 2050, then, rather than weakening before making landfall, it would probably have strengthened considerably, creating far more havoc.

Let’s look at the region in 2050, assuming BAU (business-as-usual) warming, or no effort to reverse current emissions trends.

ornl-final.jpg2050-ornl-final.jpg

Now that is bad news for New Orleans, the Gulf Coast, and the South Atlantic. The average warming in the Gulf, Caribbean, and coastal Atlantic is 1°C to 2°C, but this model has an enormous body of very warm water 2°C to 3°C over much of the typical storm path for a hurricane like Katrina or Gustav. There are two relevant points to recall:

  1. The National Climatic Data Center 2006 report on Katrina notes that the surface temperatures (SSTs) in the Gulf of Mexico during the last week in August 2005 “were one to two degrees Celsius above normal.
  2. In the case of both Katrina and Gustav, they hit colder water before hitting the coast — a key reason they were far weaker at landfall than they might have been, as these pictures make clear:

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Salt Lake Tribune: Jim Matheson (D-UT) “picked political expediency over science” voting against climate bill and thus “failed Utah and the country”

Tuesday, May 26th, 2009

When Waxman-Markey passed out of committee on Friday 33-25, only three Democrats voted no, along with every Republican but Bono Mack [see "House committee approves landmark (bipartisan!) clean energy and climate bill"].

One of those Democrats was Jim Matheson of Utah.  The state’s largest newspaper, The Salt Lake Tribune, wrote a strong editorial Sunday criticizing that decision, “Vital energy bill deserves support“:

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The United States of Waste

Tuesday, May 26th, 2009

The U.S. economy is incredibly energy inefficient, a key reason even strong climate action has such a low total cost — one tenth of a penny on the dollar.

This inefficiency is summed up best in one remarkable statistic that I first learned at the U.S. Department of Energy and then reprinted in my 1999 book, Cool CompaniesHow the best businesses boost profits and productivity by reducing greenhouse gas emissions:

The average fossil-fuel electric power plant converts only one-third of the primary energy it burns–coal, oil, or gas–into electricity.  More energy is lost distributing it from the power plant to the end user.  The energy lost by U.S. electric power generators equals all of the energy that the entire country of Japan uses for all purposes:  buildings, industry, and transportation.  Most of this lost energy is in the form of waste heat that is literally thrown away by electric utilities:  Thus, more fossil fuels must be burned in your company’s furnaces and boilers to generate the heat and steam needed to run your business.

The key to reducing most of that waste is the simultaneous generation of electricity and heat, called cogeneration, combined heat and power (CHP) or recyled energy. You can read the basics here.

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I have included CHP as one of the 12-14 “stabilization wedges” we need to stabilize at 350 to 450 ppm (here). Some people, like my friend Tom Casten, Chairman, Recycled Energy Development, think it could be multiple wedges.  In an interview I recommend all readers watch (here) or read (here), Casten asserts that in this country alone:

We could take the 42 percent of carbon dioxide that comes from electricity and cut it in half and save $70 billion.

For more details on the U.S. commercial and industrial CHP potential — estimated to be some 160,000 MW (!) — and the policies needed to achieve it, see “Recycled Energy — A core climate solution.“  For a September profile on Casten with a fascinating case study of recycling energy, see this Forbes article.

The rest of this post excerpts the second half of the introduction to Cool Companies, which presents numerous case studies of manufacturing companies that have cost-effectively employed CHP and other low-carbon strategies to boost profits and productivity — strategies that are still available to the overwhelming majority of US companies, strategies that will become the norm once the nation is committed to strong climate action.

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Judge Sonia Sotomayor on Energy & Environment

Tuesday, May 26th, 2009
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President Obama has chosen federal appeals judge Sonia Sotomayor for the Supreme Court.  The African American Environmentalist Association has an extended discussion of her energy and environmental views, reprinted below:

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