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Does Europe Really Need an Emissions Performance Standard to Keep from Falling Behind America?

Last month at the European Parliament, the WWF held an event that was titled: “Fighting Coal CO2 Pollution: Is the EU Falling behind the US?” The event was held to discuss the United States’ use of an Emission Performance Standard (EPS) as a part of the climate change regulations that it will be effecting under the Clean Air Act. The event raised the question of whether such a policy could be a helpful compliment to Europe’s climate change policies, particularly its troubled Emissions Trading System (ETS) whose excess permit supply has allowed Europe to return to burning cheap coal.

Where ETS had failed to keep coal from the market, the event’s conveners hoped that an EPS might succeed. After all, in the United States there is no carbon price, but coal-burning fell off a cliff after 2008 in the face of stricter carbon dioxide standards for power plants under the Clean Air Act. Europe, meanwhile, remains irrevocably addicted to coal. Is the United States is doing something right while Europe’s policy has run amok?

Not really. Carbon intensity in the United States currently stands at just above 0.5 tons of carbon dioxide per MWh. Europe’s carbon intensity—in the midst of its coal bacchanalia—is 0.31 tons of carbon dioxide per MWh. That number has actually declined in the past few years even as coal use in Europe has increased, and done so despite the fact that Germany has taken on the order of fifty terawatt hours per year of zero emissions nuclear offline. If Europe instituted an EPS just like the United States has, it would have to increase its carbon intensity by 45% by 2030 in order to meet the target that the United States has set for itself for that year of 0.45 tons of carbon dioxide per MWh.

To which one might say, but of course that’s not what anyone is talking about. Even in the United States, 0.45 tons per MWh is the country average; some states have stronger targets, others weaker.  Europe’s EPS could be selectively applied to coal-offending countries in order to drive down coal consumption. Perhaps. But this is not the way that the EPS has been applied in the United States, where coal burning states, due to the pragmatic realities, have been given the highest per-megawatt hour emissions quotas, whereas states with a cleaner emissions profile have the tightest targets. This speaks to a reality of climate change policy—that countries and governments do what they can, given the barriers that are created by powerful incumbent industries and their influence in governments. But put that aside for a moment and consider that in Europe some of the countries with the highest renewable energy generation percentages also are major coal offenders—namely, Germany.

Would an EPS really fix the problem? In Germany, coal is being burned as a bridge fuel to the fill the power demand while it continues to bring more renewable energy online, and retire its nuclear power plants. That the United States is using gas, not coal, as a bridge fuel is an indication of the comparatively low gas price in the United States, not its comparative virtue with respect to Europe, or the comparative success of its carbon dioxide regulations. Indeed, despite impending regulations on coal in the United States, coal emissions continue to fluctuate with gas prices; in 2013, coal generation increased by 71.6 TWh, an amount greater than the 50 TWh per year increase that European environmental organizations are trying to prevent with the introduction of an EPS.

Rules for the US EPS under the Clean Air Act are not yet finalized. But one of the many options being discussed for their implementation is trading of carbon efficiency between over-performing and underperforming regions. Such a measure would mean that when gas prices increase in the United States, American generators will have plenty of room to continue using coal as a bridge fuel in the same way that Germany is using it now. Indeed, even without trading, with the target as high as 0.45 tons per MWh, There will be room in United States for using coal as a bridge as in the same manner that Europe is now as gas  prices increase.

More dangerous still for the United States, while coal is clearly a bridge in Europe, it may be a long-term strategy for the United States, which, in the absence of the renewable targets that exist in Europe, is already starting to replace its retiring coal-fired power plants with gas plants, rather than building renewable energy. This will lock the United States into a long-term relationship with natural gas that will prevent it from meeting the emission reductions targets required to mitigate climate change. It is true that Europe has a number of new coal-fired power plants coming online, but these are the result of legacy policies, and—with the possible exception of Poland—new plants are very unlikely to be permitted in EU countries in the future. The average age of a coal fired power plant in the United States is 40 years old, in Europe it is 34 years. In both regions, much of the coal fleet will be retired in the next 20-30 years. For both regions, the critical question is what will replace coal. Europe’s use of coal in the mid-term, unlike the United States use of gas, does not hold the danger of massive new investments in long-lived energy technology that is incompatible with a stable climate.

Of course Europe could design an EPS with a target that was so tight, say 0.2 or 0.1 tons of carbon dioxide per MWh, with tight geographical boundaries, no concessions for coal regions, and no trading that would make it harder to burn coal, and drive an accelerated retirement of coal-fired power plants. But if Brussels could pass this without giving concessions to the member states and industrial interests that will lobby against it, one might ask why it couldn’t simply tighten the ETS, or increase its renewable energy targets and get the same effect?

In some ways the focus on the EPS is strange preoccupation with form over function. The political economy and civil society of a region, more than the particular policy levers it chooses, shape the substance of climate policy and the ultimate strength of its outcomes. That there is such debate over coal burning in Europe despite the comparative strength of its climate policies is already an indication that it is a leader in emissions cutting. Coal burning or no, there is no other region of the world where there is such concern both within environmental organizations and the government not just with cutting emissions, but cutting them enough to matter.

This post was also published on The Energy Collective.

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Did The “People’s Climate” March Leave Conservatives on the Sidelines?

“I wish they wouldn’t call it The People’s Climate March.“ I said to a friend in the weeks before taking the bus up to New York City to attend the march. The messaging seemed out of line with the organizers’ stated intentions to include everyone. But my friend insisted that getting conservatives to attend the climate march was more than just a matter of words. The science was there; if people wanted to fuss about words and not believe the science, that wasn’t his problem. But it isn’t simply denial that keeps people from turning out for a demonstration.

Katherine Hayhoe, climate scientist turned political science professor and evangelical Christian, clarified the problem in a recent television interview, “It’s not a scientific issue…The answer has much more to do with who we are as humans, and how we function politically.”

“Would your father attend The People’s Climate March?” I asked him. Both of us have conservative fathers who believe that inaction on climate change is a serious failure of both the Republican and the Democratic leadership. He conceded that his father would not. And nor would mine. But the truth is, demonstrating is uncomfortable for many people, regardless of political affiliation, who perceive it as something that other people do—people more emotional, idealistic, and perhaps less rational than they are. My experience in trying to recruit people to attend the march was that, right out of the gate, the name on the fliers seemed to confirm their biases about who marched and how their values were different.

The march, of course, didn’t have any attendance problems—the crowd of an estimated 311,000 outstripped the organizers’ reach estimates by a factor of two, and it was about six-eight times larger than the previous best-effort in Washington, D.C. only a year and a half ago. A lot of work went into reaching out to labor groups, churches, and organizations that had never before identified climate change as a key issue, and that work was a striking success. But I’m not sure it was necessary to leave conservatives behind in the process.

I was made to revisit my concerns when at the march in New York I looked at the logistical material for the line up at the front of the march, in which participants were encouraged to group by six different affiliations—solutions, front line communities, building the future, a section entitled “we know who is responsible” under which  “anti-corporate campaigns” were encouraged to line up.

Anti-corporate? “Corporations” are not one thing. Renewable energy companies and electric car companies are corporations. Whether the future is full of centralized or distributed, community, or utility owned power, the technology will be developed and delivered by corporations. I do not doubt that powerful incumbents in the fossil fuel industry use their political and economic power to block legislation on climate change. Their behavior is unconscionable, and it is not limited to oil companies. But the government has also participated in the corruption of American democracy, and it is there that conservatives tend to direct their outrage. There were no anti-government campaigns under the “We know who is to blame” section. For a movement that wants to be broad-based, would it not be better to welcome both sides and let them bring their own messages instead of sending unsubtle queues about who the march is really for?

Several days after the march this message came across my twitter feed, “I can think of few ways to marginalize a movement seeking to rally mass support faster than giving Naomi Klein the microphone. #sigh.”

Author and activist Naomi Klein is a board member of, the most prominent and successful grassroots climate change organization. is a small group of people that has done tremendous work bringing an awareness of climate change and helping to organize and publicize participatory actions for people all over the world. A brief twitter exchange with the tweet’s author led me the radio interview that had elicited his lament—an hour long segment on Boston’s WBRU that Klein was giving in connection with the march and her new book, “This Changes Everything: Capitalism vs. The Climate.”

When I moved back to the United States seven years ago after having spent many years working on investment in clean energy projects in Asia, one of the stranger things for me to discover as I familiarized myself with the cultural debate around climate change was the accusation made by certain elements of the right wing that climate change was a plot dreamed up by liberals to destroy capitalism. Having worked in a commercial enterprise with the goal of stopping climate change, the two things were unrelated in my mind. The roots of this fear are now more obvious to me even if it remains, in my mind, as unwarranted as ever.

But for Naomi Klein the fear is not unwarranted. On the contrary, she seeks to validate it. The title of her book is a provocation, meant to meet the opposition head on, reclaiming its territory as her own. Yes, she says, capitalism is to blame for climate change, and yes, conservatives were justified in their fears. But these two things, capitalism and climate change, are unequally matched. The climate can be specifically defined, capitalism cannot be; it is an economic system that takes many shapes in different societies, and can be modified or restrained to fit the needs of the future. As with the term ‘corporation’, a blanket condemnation of capitalism is hard to make sense of.

Many of the things that Klein calls for—small, locally owned energy enterprises, government control of dangerous activities, strengthened homeowners rights, and the end of predatory banking, breaking the link between economic growth and resource depletion—are not inimical or intrinsic to capitalism. The same is true for radical deregulation which, in her interview on WBRU, Klein conflates with capitalism. Radical deregulation is a trend that in past thirty years has seized both Democrats and Republicans alike. Not even Adam Smith advocated for it, and it has been criticized by Anat AdamtiDavid Moss, and Simon Johnson respectively of Stanford, Harvard, and MIT Business Schools, to name a few.

Even Klein’s statement that some profits are illegitimate is far from anti-capitalism. The mere existence of markets in a society does not imply that the amoral transactions that constitute them need to rule, unchecked, in its every aspect. On the contrary, it is important for a healthy society to evaluate where markets belong and where they don’t. Different societies will have different lines, but the need to establish a line is in itself uncontroversial. Even Milton Freidman would have balked at selling babies.

Klein demurs when it comes to solutions, saying that she is a journalist diagnosing a problem, and she will leave solutions to others. She is clear that she does not think that communism is the solution, acknowledging that the record of communist societies in dealing with the environment is terrible. In many ways, this acknowledgment negates her thesis. It’s not capitalism vs. the climate; it is destructive human activities vs. the climate. And these destructive activities can be mediated through any number of government systems. However we choose to organize society in order to deal with climate change, it will be some combination of market and non-market activity. Unless, of course, one is advocating full-throated communism, which Klein certainly isn’t.

And so it is not clear to what this language serves, coming from someone on the board of such a prominent climate change activism organization, except to alienate a vital section of the grassroots. This is a pity because there is much in Klein’s message—particularly in her eloquent detailing of the harm that major industrials run amok cause to human and infant health—that is important and underreported. It is a message that would resonate with almost anyone, regardless of political affiliation.

It would be one thing if none of this mattered, but it does matter.

In a column last week, entitled, “Why the [Awesome] Climate March Won’t Change America,” Grist writer David Roberts rightly pointed out that the climate march is hobbled in its ability to effect change because, diverse though it was on the liberal side of the spectrum, the right, by and large, did not turn out.

“[march organizers] would have been over the moon to have more Republicans. They deliberately kept the march’s message broad, avoiding specific policy demands, to allow a wide range of people to participate. I’m not one of the many back-seat drivers who blames the climate haws for the right’s intransigence of the issue. The right is to blame for the right. And right now, the right is unreachable on climate change. But the fact remains that the diversity on display was, broadly speaking, diversity within the left.”

Of course people are to blame for their own actions, but reasonable people can disagree on whether not turning out for the march is blameworthy if one is conservative.  The march’s message might have sounded broad to Robert’s liberal ears, but it wasn’t terribly. Further, not joining the People’s Climate March is not synonymous with climate denial. Roberts says that, “The right is unreachable on climate change,” a characterization that is both inaccurate and dehumanizing.

Roberts confuses the denial and inaction of conservative members of Congress with the broad base of conservative voters, whom he dismisses as a bunch angry and entitled southern white men.

Let’s look at the numbers. The Yale Climate Change Opinion Survey details that of 726 self-identified conservative voters, 52% of them believe that climate change is happening, 26% percent do not, and 22% don’t know. Seventy percent of conservatives believed that the United States should increase the use of renewable energy “immediately”. Forty-two percent of those people believed that that the benefits outweighed the costs of greater government regulations. Two-thirds of respondents believed that America should take action to reduce its fossil fuel use. Only one third of respondents felt that the Republican Party’s position on climate change reflected their own, and a majority believed that their congressional representatives were unresponsive to their views on climate change.

So that doesn’t sound like unreachable on climate at all. It sounds like the Republican Party has a position on climate change that is increasingly untenable, and that there is a disconnect between the desires of the electorate and the actions of the Congress. It is not just a problem with climate change and the Republican Party. A recent Rasmussen poll showed that 53% of Americans believe that neither political party represents them, and the most recent numbers for Gallup’s confidence in  Congress poll show that number to be at a new historic low for the poll’s forty-two year history; seven percent of the public reports having a high degree of confidence in Congress, while two-thirds of the voting public has ‘very little’ or ‘no’ confidence in the Congress. All of this seems to indicate that Americans vote, but are not entirely happy with either options or the results, and that it wrong to categorize the public as a whole in terms of broad swaths of red and blue.

William J. Becker, Executive Director of the President’s Climate Action Project, has already taken Roberts to task for ignoring the data on conservatives. In a column yesterday, Robert’s breezily dismissed Becker’s data, saying he doesn’t trust polling and message testing because data doesn’t represent the way that people will act in the real world. He then goes on to describe how he believes the real word does act by citing the Ph.D. research of Irina Feygina, who…seems to have done a lot of work with polls and message testing. The first line of her Ph.D abstract reads, “Despite extensive evidence of climate change and environmental destruction, polls continue to reveal widespread denial…” It appears some polls and message tests are more equal than others.

That said, of course polling and message testing are limited and are not predictors of political behavior. They are a grain of insight, nothing more. And that is an important insight, if you need polls to get it. I do not have the same, incredulous reaction to these polls as Roberts because, for me, they reflect realities that I see in my personal and work life. But from Robert’s descriptions of how ‘the conservative’ behaves, one gets the impression that his only exposure to conservatives is what he reads in the liberal media; that he is both the purveyor and the product of the very polarization he calls himself “obsessed with.”

I give you this:

Put a conservative in a room with a poll and ask him whether he supports cleaner air. Why of course he does! More efficient energy use? Sure! More solar energy? Yes, please! People like cleaner, more, and better, generally speaking.

Now imagine that conservative in his living room, watching Fox or listening to talk radio. Is he hearing about cleaner air? No, he’s hearing about job-killing regulations, which he hates. Is he hearing about efficiency savings? No, he’s hearing about Big Government coming to take his lightbulbs, and he hates that. Is he hearing about the recent flourishing of solar power? No, he’s hearing about Solyndra, about government boondoggles and giveaways. He hates those.

Would Robert’s dare refer so categorically to any other group but conservatives? And also, did it occur to him that his own reaction towards optimistic polls about conservatives and climate change is not far off from the behavior of ‘the conservative’ that he so grotesquely caricatures?

In the service of his Manichean depiction of America, Roberts shows a map of the United States, color coded red and blue by the straight majority of the districts that voted Democrat or Republican in the 2012 Presidential election.  He contends that liberals exist in what he calls ‘urban archipelagos’ with the rest of the country awash in rural angry-white redness. This picture is radically oversimplified. Even a slightly color coded map shows a more nuanced and accurate picture. This map from the Chicago Sun Times is a good graphical representation of the margins of victory between Republicans and Democratic in congressional districts, making it clear that margins of victory are slim in most states. The geographical divide is also far more nuanced than Roberts would have us believe

There are people who vote for both parties all across the country, and they encounter each other every day in school, as neighbors, and at family gatherings. Contrary to what some pundits in rarefied circles would have us believe, we are not, as Americans, binary-red-and-blue-bots who avert our eyes from The Other on the rare instances that we happen to pass on the sidewalk. Among our ranks are Republican voters who believe in broad access to inexpensive healthcare and strong action on climate change and Democratic voters who believe in fiscal conservatism and second amendment rights. But for both parties, their decisions at the voting booth are restricted in primaries and congressional campaigns run by well-funded and organized groups with a few, narrow priorities. Few individuals are so involved in the political process that they can, or even would consider, participating in picking their political candidate, or even forming a relationship with their already elected official by way of writing, visiting, or demonstrating in order to influence that official to act on certain issues. Just because Republicans—and for that matter Democrats—care about climate change does not mean that it is an issue that they are organized to vote on.

The implication is that there is plenty of room to activate people who care about climate change. This is what has been and doing well, but it appears to be triaging a critical constituency as a hopeless case.  David Robert’s bombast is extreme, but the risk is that the prejudice behind it, “Forget them, they’re hopeless. They might as well be from Alpha Centauri. Their values are not ours. Their very brains are wired not to care,” is, in fact, endemic to a large section of the environmental movement. Robert’s solution for funders—which appears to mirror the strategy of the grassroots movement—is to fund liberal causes, and build a passionate and active liberal movement. That’s what appeared to be happening at The People’s Climate March. But Robert’s strategy is internally inconsistent, doomed to failure by his own analysis. He himself points out that odds are that conservatives will continue to control the House of Representatives for any timeline that matters to climate change. So what, exactly, are we trying to accomplish?

It’s good news that some climate change advocacy groups still put science before politics. Groups like the Citizens Climate Lobby, which organized lobbying visits to more than five hundred Senate and House offices on this last summer to lobby for a revenue neutral carbon tax, has a non-partisan membership and has an fanatical ethos of respect for all people involved in the organizations, regardless of their political affiliation.

Others would do well to follow suit. No one movement will be enough, and the organizations putting people in the streets are powerful. They could be more so. The environmental movement has repeatedly claimed that “climate change is not a left or right issue.” If that’s true, they need to walk the walk. More alarming still, that truth—that climate change affects us all— seems to be threated in the minds of some by the creeping notion with that it really is a liberal issue after all. That is a pity not just because it is wrong and is in itself a fundamentally illiberal idea, but also because it is a dead end.

This post was also published on The Energy Collective

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Why We March

March Picture

We left at six in the morning from Washington, D.C., bleary-eyed and unresponsive to the bus leader who gave us the run down on how the day would go. But by ten o’clock, when the bus rolled into New York City, people were introducing themselves, chatting about their points of origin, reasons for coming. The bus came from D.C., but it pulled its passengers from a wider radius. This four-hour trip was just the last leg for many of them. At one point a giddy, grinning, middle-aged man, there with his college-aged daughter took over the PA system to share a few upbeat lines of climate-march doggerel that he composed on the ride up.

I started demonstrating three years ago when, more than a year after I had turned thirty, I found myself getting arrested outside the White House to protest the approval of the Keystone Pipeline. In college, studying for my economics degree, I remember watching fellow students from the window of the library as they protested World Bank lending policies. I thought they were silly. I thought that anyone who really knew what she was talking about could make a chart and find a reasonable person to listen without needing to make so much of a fuss out in the street. If you didn’t know, you had to yell. It took me almost a decade of chart making before reality sank in. There were fifty thousand students at the rally yesterday. Whenever I see youth out at demonstrations, I am impressed with them for having an understanding of government and individual responsibility far superior to what I had at their age.

Joining a movement takes you outside of yourself in ways big and small.  Yesterday morning when the bus leader stood up and said that we were going to go around the bus and introduce ourselves, I curled up in my seat, looked at one of my companions and grumbled, “Noooooo.” I don’t do well on little sleep, and I don’t do well on long, lurching, over air-conditioned bus journeys either, but that morning I’d done both of these things and didn’t want to be bothered to do much else. But after everyone on the bus had introduced themselves to the group and I heard how much farther many other people had come, I was forced to remember that I had come out to be something more than my every-day, ineffectual self. I introduced myself to the man behind me, who had just come back from seven years of democracy-building work in Afghanistan, was traveling by himself and had said that he, “wasn’t affiliated but was looking to be.” I was affiliated, a part of a nationwide grassroots lobbying effort on a carbon tax, and traveling with a group of people from my local chapter in D.C. I told him about our work and he ended up marching with us.

We got off the bus at around 86th and Amsterdam. I noticed, looking through the windshield as I stepped down off the bus, that most of the people on the street appeared to be carrying signs and heading towards Central Park. A marching band made their way across the immediate intersection, their percussions announcing their way. They were one group of dozens of bands come to show their support and help move people along, as drummers have always have done with armies. We were told to expect one to two hundred thousand people. No one knew yet that that the actual numbers were three to four hundred thousand. But it looked like there were a lot of people on the move.

At about 11 am we stepped into the staging area that stretched along Central Park West from Columbus Circle and up into the eighties. We were at 73rd. Standing in the middle of the street waiting to move, it was hard to know who was in or out, or if even those people themselves knew. We were shoulder-to-shoulder inside the police lines, but there were almost as many people in the wings, lining up along the sidewalks, kids climbing the scaffolding of buildings to get a better view, people sitting on the rock embankments of Central Park taking photos, assembling signs, and floats. We were in the middle of a lot of vegans carrying signs saying, ‘Ask a vegan why you’re not a real environmentalist if you eat meat.” I eat meat, and I do give a damn, so I didn’t bother to ask. Lots of livestock is pretty bad for the planet, no argument there. Another sign said, ‘What’s the ROI on a dead planet?” But it’s the dead planet that’s the ROI on fossils and reckless agriculture, I think. Behind us, a group of people launched a ten-by-fifteen foot inflatable Holstein cow and started moving it into the center of the column. We made way.

The vanguard started walking at 11:30. Less than halfway up the staging area, we were still stock-still by 12:30, and a little restless. It was a cloudy, swampy day for late September and uncomfortably warm. Some of us sat down on the pavement to give our legs a break before we started walking. Beneath the street, the subway rumbled by at regular intervals, and overhead the police helicopters made routine sweeps. But no one complained about the long wait because we all knew that it meant that the crowd was huge. Each one of us had come with the burning ambition to be only the tiniest possible fraction of the whole. It was that that would make us powerful. So as we sat and waited amidst the masses, we had the sense that we had succeeded.

‘It doesn’t make a difference.’ I have heard the criticism more than once when trying to corral friends to join me at demonstrations. They talk about the ignored Iraq war protests. They point to global governments that are becoming increasingly insensitive to democracy. But like it or not, at the time that the United States invaded Iraq, the majority of Americans saw Iraq as a security threat and were in favor of U.S. action. And the millions who took to the streets against the Iraq war, feeling the sting of their failure a few months later, did not return.

A majority of Americans now believe that climate change is real, man-made, and want the global governments to do something about it. The New York climate march is a reflection of what most of the public feels. But of course the public can be ignored. In the coming days and months global leaders will continue to talk about climate change within their countries and between other countries. They will likely continue to put forward actions that are not strong enough. The public will have to stay on top of this every step of the way. The march is not the culmination of the movement; it is the beginning still. It is a way of showing how many of us care enough that we are willing to get up early, to pay for planes and trains, sit on uncomfortable bus rides, stand in line in swampy weather and to march in huge crowds for hours in order to be heard. The significance of this march is not just that it happened and was huge, but also that it is almost ten times larger than the last largest American climate change march that happened in Washington, D.C. just a year and a half ago.

And in democracies we will also vote the way we walk. But it is hard to vote when leaders of all countries and parties have been complicit in inaction. And so we are in the streets en masse, because it is a time-tested way of making governments uncomfortable in their complicity. No one wants to rule a country where something like that keeps happening.

At about four o’clock, we marched through midtown and, having stood for hours, a friend and I ducked out of the march to get something to eat. The pizza line was full of marchers and non-marchers alike. I was in line behind a set of the latter. A man wearing a Mets sweatshirt tapped his finger on the pizza in the window, “This is the stuff. This is a good New York slice right there.”

“Not as good as a New Jersey slice,” the friend said. The man snorted and the friend defended himself, “Hey, I’m from Jersey, gotta stick up for it.”

The man still shook his head. I am of midwestern origins and can’t parse the difference in Eastern pizza types, but they both had accents that indicated they knew their territory. Then a few marchers coming up the sidewalk, walking counter to the flow of the main parade, overwhelmed the conversation with their chanting, “What do we want? End climate change! When do we want it? Now!”

The men listed for a second, tilting their heads and then bouncing them in rhythm to the chant. And then as the demonstrators passed they joined in, responding, “End climate change!” And when do we want it? “Now!”

The nodded to each other as the marchers faded away, and the man from New York said, “Yeah. Ain’t gonna end it though.”

The friend shook his head in agreement, “Nope.”

“You can slow it down, but you can’t end it.”

They saw me watching them, recognized me for what I was, and shrugged. I met their eyes nodded my head. Atlantic shore locals would know. They were still recovering from the floods.

As we rejoined procession the police, having double the people they had anticipated, had stopped giving full right of way to the demonstrators and started breaking the march at intervals to let traffic through. As we waited at a light to get back into the flow, a barfly stuck his head out into the street and shook it in a mix of wonder and exasperation. “They’ll still f—ing marching!”

And they will continue to be.

This post was also published on The Energy Collective.

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Energy Prices on Both Sides of the Atlantic Still Not Responsible

Earlier today at the Center for Global Development, IMF Director Christine Legarde gave a talk promoting ‘responsible’ energy pricing, defined as pricing reflects the environmental costs of fossil fuels, by way of launching the IMF’s new publication, Getting Energy Prices Right, From Principle to PracticesMeanwhile, developed countries on both sides of the Atlantic were busy demonstrating how put into practice climate policies that that get energy prices dead wrong.

Last week, the EU decided on targets of increasing energy efficiency by 30% by 2030, a percentage that is well below the 40% targets that many environmental groups were hoping for. The debate around energy efficiency targets in Europe has been fraught with accusations that the Commission is using opaque modeling to justify efficiency targets kept deliberately low in order to prop up the carbon price in the ETS. Brook Riley of Friends of the Earth has called the debate ‘bizarre’.

It would indeed be bizarre if the E.U. were keeping efficiency targets low to protect the carbon price. Efficiency and carbon pricing should be complementary, not competing policies. Energy efficiency targets are designed to mandate action on the negative end of the cost curve that is entirely insensitive to carbon pricing. If an economy is so energy inefficient that mandatory targets significantly reduce the demand for fossil fuels, then the logical implication is that there is plenty of room to increase reduction targets without causing the carbon price to spike. In essence, the best way to protect the carbon price is to reduce the cap. And energy efficiency policy should have no ambitions beyond efficiency. It is a pity that the EU-ETS cannot manage to solve its oversupply problem through a steeper or permanent set-aside, but treating efficiency as a back door to the carbon price is the wrong way to rectify the problem.

As the EPA closes out the Washington, D.C. public comments period for its Clean Power Plan, it is worth asking what the total global impact of the Obama Administration’s climate policies will be. The administration is mandating national emissions targets of just over 1100 lbs per MWh of generation by 2029. The size of this target is synonymous with locking in natural gas as the fuel of choice for the U.S. power sector.  The Obama Administration has made no secret its intention to use natural gas as a bridge fuel for emission reductions. The appeal of this strategy is easy enough to see—having let cheap natural gas set up the ‘bridge’, the administration need not bother itself about how to get to the other side—a question the Clean Power Plan certainly doesn’t address.

A recent report by Rhodium Group and CSIS shows that the Clean Power Plan will cause a 15% increase in natural gas generation over the reference scenario by 2030 versus a 1% increase in renewable generation. Environmental groups lauding the Climate Action Plan tend to focus on its impact on coal, which will indeed decrease. To what end? More exports for China, evidently. The developed world has a long history of exporting its pollution to poorer countries, but the act takes on unusual perversity when the pollutant is carbon dioxide, which doesn’t stay out of the proverbial back yard if one chooses to burn it there.

But can the government be blamed that the coal is going to China? It can be. As the above article from Vox highlights, 40% of U.S. coal comes from public lands, and the Obama administration has presided over the leasing of 2.2 billion tons of coal to private companies in non-competitive auctions. That is to say, it is practically giving away the coal to allow private companies to profit by selling environmental destruction to China. A real climate policy would put a price on the carbon dioxide in coal at the mine mouth to close the export loophole. Some may protest that such a policy is out of reach of the Obama Administration, but setting a higher reserve price for the auction, which would have the same effect, is far from politically impossible. And yet the U.S. government continues to ask for plaudits for reducing coal, and all the while it is giving it away.

Whether in coal or carbon pricing, if the U.S. and Europe want credit for strong climate policy, they should put their money where their mouths are.

This article was also posted on The Energy Collective.

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Model Governance and Emissions Models, Transparency and Climate Policy in China and the EU

Last week Reuters published a brief article updating the public on the status of Beijing’s emissions trading system, with its thinly traded volumes and largely opaque transactions. The crux of the article comes in the last paragraph, Without transparent data, it is hard for investors to position themselves,” said another trader, who asked not to be identified because he is not authorized to speak to the media. It doesn’t bode well for the strength of China’s emissions trading system that the person willing to speak out about its core problem, lacking the State’s imprimatur to open his or her mouth, prefers to remain anonymous. This is not the kind of environment in which strong climate policy can prosper.

But opaque climate policy is not just the purview of post-communist oligarchies.  Earlier this month at a meeting on modeling for climate policy at Breugel, a Brussels-based economic policy think tank, attendees were privy to the spectacle of Peter Zapfel, Assistant to the European Commission’s Director General for Climate Action, telling the crowd that they should ask themselves how much transparency the public really needed. The issue in question was the closed-source PRIMES model, the partial equilibrium model used by the European Commission to determine the impacts of different climate policies and to justify the policies selected by the Commission for the achievement of their own 2030 targets for climate clean energy. Attendees representing environmental NGOs in the room, including Friends of the Earth, WWF, and Greenpeace were demanding that that the basic assumptions of the model be made public.

Zapfel’s response, in essence, was that the top line outputs of the model were all that mattered; civil society didn’t need to worry its little head about the inputs. To illustrate his point, Zapfel added that he used to want to know all of the technical specifications of his camera or computer, but then he realized that that was too much information, and all he really needed to know was whether the camera or computer was good or not.

It was a strange analogy from a technocrat, given that revelations about unbounded reach of the United States NSA have recently left the whole world to learn the hard way the dual perils both of not fully understanding the capabilities of their own high technology and of taking a government that says, “just trust us, it’s for your own good” at its word.

Complex systems create the possibility for magnification of small error; therefore, as societies increasingly rest on complex systems, they have a greater, not lesser need for transparency and for civil society organizations to observe and translate the importance of the small details to the public. Whether those details are the discount rates or technology assumptions used in a model, or the quality of continuous emissions monitors used to measure the integrity of an emissions trading system, they have the potential to create consequences of national and even global significance when climate change is what is at stake.

The European Commission has listed “new governance systems” as one of the key elements of the policy framework for its 2030 climate and energy goals. As the Commission sorts out exactly what this means, it would do well to remember just how foundational transparency is to good governance. Both China and the European Union are making real attempts to find the best solutions—both in policy formation and implementation—for the reforming their energy systems, but gagging or blinding their best watchdogs is the wrong way to be spending their efforts.

This article was also posted on The Energy Collective.

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Short Commentaries 5/31/14

China, EU launched three-year cooperation on “Carbon Emissions Trading Scheme” from English People’s Daily. Cooperation will include exchange of experts and sharing of experiences and best practices. One wonders what the EU, plagued with endemic oversupply, can offer the Chinese system. Chinese regional schemes are still young, but a major problem seems to have been lack of price clarity and transparency. On the surface, price problems in China come from a different are different to those in the EU, but the problems have a common root—lack of will to create real reductions. In the idealized world of global emissions trading, cooperation and harmonization should begin early, but as yet there is no indication that ambition or leadership on either side is enough for this cooperation to amount to anything more than trading around the margins.

U.S. eases risks for $134 million forest protection fund from Reuters. USAID moves way from direct payments to projects to a model that, on its face, is more private sector oriented—using its money to leverage investments rather than to directly fund them. The press release gives very little indication of the kind of activities that will be funded or how loan recipients will repay the loans—either traditionally through business activities, or through the sale of voluntary forest credits. It also does not indicate the terms on which Althelia is offering the credit, or the price at which it is buying this insurance from USAID. All of these things would be useful in knowing if Althelia is engaging in actual commercial-style transaction or, or merely giving out donor money with commercial attributes. There is nothing wrong with the latter per se, but there is a question of what it will be proving to the private sector if it is successful. If the transaction is successful under terms that the private sector could not accept or replicate, then leverage effect of the USAID guarantee will have no effect beyond it’s immediate disbursement. This would be a missed opportunity because forest protection needs more money than the public sector can currently offer. While USAID has called Althelia the first private sector fund of its kind, its backers are all development banks. This is, in fact, USAID insuring the European Investment Bank. But if the projects are successful on terms attractive to the pure private sector, perhaps it will follow.

Wonks Collide as Obama Climate Plan Prompts New Ideas from Bloomberg. Great River Power proposes a carbon price that is set according to a level of desired abatement and collected by regional ISOs, who then refund to the fee to the load serving entity on a pro-rata basis per hours of generation. Set up in this way, the price acts directly on the dispatch order of electricity, pushing coal, which would have the highest carbon price, further down the queue. Authors of the study claim that cost relief for consumers will be provided through refunding the revenues to the load serving entity. But in deregulated markets,  load serving entities, will be likely both keep the refund and pass through the price increase anyway. That said, this is not a bad way to arrange a carbon price for power. It would be a step forward for the EPA if, under the carbon regulations for existing power plants to be that will be announced this Monday, it allows for states to creatively implement their carbon limits through use of this pricing plan, or another one link it.

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Between Drilling and the Deep Blue Sea

““Unlike most of the planet, the Arctic still contains uncharted mysteries,” Bloomberg yesterday quoted Scott Minerd of Guggenheim Partners LLC as saying.

The statement is no doubt true. The Arctic is among the last pristine wildernesses on the planet. There are elements of the global influence of its climate and the local details of its ecosystems and geology that science has not yet attempted to record, let alone understand. But Minerd was being loose with the language—by ‘uncharted’ he meant ‘unexploited’, and by ‘mysteries’ he meant ‘resources’. His investment management fund is looking at investing in heavy industry in the Arctic region.

Guggenheim Capital Partners is not the only investor interested in exploiting the Arctic. A 2012 report from Lloyd’s of London identifies around $US 400 billion of committed and projected funds for the development of potential Arctic oil and gas projects. Four hundred billion dollars is not a spectacular sum when it comes to the oil and gas investment—Ernst & Young reports that 75 non-national oil companies representing only 9% of oil and gas reserves worldwide invested $US 540 billion in 2012 alone.  Investment numbers for national oil companies, which hold 90% of reserves, were omitted. Lloyd’s numbers are quotes of preliminary estimates and crude approximations as such. The U.S. Geological Survey estimates that around 22 percent of the world’s untapped oil and gas reserves are in the Arctic. If a sizable fraction of reserve prospects for Arctic development proved exploitable, total investment would well exceed $US 400 billion.

What else could be done with this money? A timely transition to renewable energy will require at least US$ 1 trillion in investment a year. But total renewable energy investment was down by 11 percent last year to $254 billion dollars—some considerable change shy of the trillion-dollar mark. Even if $1 trillion isn’t an exact figure, it’s beyond dispute that more money is needed.

Investment in Arctic Ocean oil is an interesting analog to renewable energy investment. In the logic of the last decade, risk-adverse financial investors would flock to fossil fuels over renewable energy because with fossil fuels, they were confident of a steady return due to its low risk profile and steady returns.

But Arctic Ocean oil turns that argument on its head. Early this year, after spending $US 6 billion dollars and not drilling a single well, Shell announced that it was suspending its operations for drilling in the Arctic for fear that the investments were damaging its bottom line.

Shell’s $US 6 billion dollar loss was buried in a portfolio of higher return projects so their shareholders, while affected by the loss, did not feel the bite in the way they might have were they taking a stake in an Arctic-only private equity fund as Guggenheim Partners is considering doing. Renewable projects, due to uncertain regulation and comparatively newer technology, are considered a risk. But average returns on renewables, in the low single digits, are better than Shell’s Arctic Ocean prospect that on account of regulatory issues, legal hang-ups and technology immaturity has until now offered only negative yields. When risk capital is the rasion d’etre for investment, it is worth asking why, when given a choice, one would invested in destroying the environment rather than preserving it?

But returns are not the end of the story, even though it is easy to get lulled into thinking of them that way. Yesterday evening, Harvard students blockaded the office of the University President Drew Faust in protest of the University’s decision not to withdraw the endowment’s investments in fossil fuels. This morning, a number of them were arrested. In a statement to the Harvard Community written last October, Faust stated that, ‘The endowment is a resource, not a tool to impel social or political change.” In so writing, Faust perhaps unwittingly, invoked the backward view of finance that recently resulted in the Great Recession by way of robbing a line from Machiavelli’s playbook— In actions of all men, especially princes, where there is no recourse to justice, the end is all that counts.

The purpose of debt and equity finance is to facilitate capital accumulation, which in turn defines the structure of the society in which it exists. Returns are fees, the project is the purpose. In a healthy financial system, financers are mere middlemen. The great disasters of modern finance, including the 2008 financial crisis, were a symptom of a financial sector that came to conceive of returns as the purpose and, in the most recent crises, deliberately created ways of divorcing those returns from the projects that they intermediated with catastrophic consequences. While it is true that investors evaluate projects on the basis of returns, it simply incorrect to imply that the decision to stop or go ahead with projects will not have social or political consequences. The ends are a resource, but the means of getting them shapes the world.

Those who say that divestment can’t strangle the fossil fuel industry ignore the fact that it can crowd much-needed capital away from the renewable sector. And why not shape a world of renewable resources that provides us with power while leaving the climate and the Arctic intact?

This article was also posted on The Energy Collective.

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Why Richard Tol is Wrong about the Upside of Climate Change

“It’s pretty damn obvious there are positive impacts of climate change,” Reuters reports Professor Richard Tol saying on his way to disassociating himself from the Fifth Assessment Report for the Intergovernmental Panel on Climate Change that he helped to author. The report is the international, comprehensive assessment of the state of human caused climate change and its impacts, which was released last week. The report, in summary, says that the rate at which the climate is changing will be very, very bad for life on Earth.

Tol doesn’t think so, but Tol is an economist, not a scientist. His expression of risk is reflective of the flaws in economic thinking. He appears to conceive of climate risks as linear and additive, basing his climatic unconcern on the outcome of a cost-benefit style of economic analysis where you count up the pros and cons and then consider if you have broken even, are ahead, or are in the red.

He points out that in the much-discounted positive side of the climate change equation, some regions will be able to grow new crops. Potatoes in the tundra! Booyah! So why all the frowny faces about impending disaster? “They will adapt.” Tol is quoted as saying, “Farmers aren’t stupid.”

No, they are not. But unfortunately for Tol’s argument, neither is climate risk linear and additive. It tends towards discontinuous and geometric. If you happen to be a farmer in India who can no longer produce food for lack of water, no amount of non-stupidity will help you think up a way to make rain. If you happen to be a farmer in Africa, you might find weather conditions forcing you to switch from farming agriculture and raising livestock to raising livestock alone. Which would be fine until you discovered you had nowhere to feed your livestock but a wider and wider range of degraded land, creating further erosion and irrigation problems for your already-stressed environment.

Of course the picture is complicated. Some crops will thrive where they didn’t before. But the known unknowns should keep us from running out and celebrating just yet. Pests will also thrive where they didn’t before. The mere existence of a substitute for a failed crop doesn’t imply that even the clever farmer will have access to the seed, or the experience to grow it, or insight into how to keep it growing in the rapidly changing and more erratic weather patterns that we are to expect with sudden climate change. These transitions take time and money and room for trial and error. The regions where much of the harm will occur do not have the money or the margin to endure these changes.

Tol’s argument in some ways echoes that of the nouveaux climate change denialists who say, “But it was warm when the dinosaurs walked the earth, and there was still life, plenty of life!” Not human life though. All the changes in past temperature took place over the course of geological time—slow enough for adaptation to occur in the biological sense of the word. Except in the case of the dinosaurs, that is, when the climate did indeed change quite quickly. Man-made climate change is happening in time frames sensible to, well, man.

This means that we are placing ourselves in conditions to which life—in both the biological and cultural sense—has never before had to adapt. We know plenty well enough to know that, given the fragility and interdependence of our existence in nature, such changes run high risks of causing catastrophe.

Tol is an economist not a scientist, but even economists ought to know better by now than to make these mistakes. After all, the catastrophic failure of economists to predict the 2008 financial crisis was in no small part a result of overreliance on models that underestimated the impact of interconnectedness and coordinated failures.

Of course farmers aren’t stupid, but Professor Tol is dead wrong to be so glib.

This article was also posted on The Energy Collective.

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Short Commentaries 02/28/14

Global Carbon Markets to Reach Record Volumes By 2016 from Business Spectator. Carbon markets need a different measure than volume for success. Article cites a point carbon analyst expecting EU-ETS market value to increase by two thirds to 7.5 Euro per ton. Increasing value drives increasing volume, but what does it mean? Permits are rising again off the back of the enactment of back loading measures and the release of a clear schedule for withholding permits from auctions. The price increase is indicative of nothing more than irrational exuberance betting on irrational exuberance. With the EU-ETS still more than 1 billion permits long, the fundamentals for a real appreciation aren’t there. The real value of these permits remains near zero. Optimists might argue that this represents a first step by the EU and that the next step is that backloaded permits will be cancelled, or further permits will be withheld from the system. Given the two-year fight over pulling out less than half of the long permits out of the system, holding permits in hope of another policy breakthrough is bound to be a bad bet. Also, more is now riding on the permits than the EU-ETS. Europe has staked out 40% reductions for its 2030 targets. As Greenpeace has pointed out, 2.3 billion banked permits in the system means that only 33% reductions are required to meet that target. Would the Commission have settled on 40% rather than the less ambitions 30% or 35% targets in play if the escape valve of banked permits weren’t present? Perhaps they would have, but as this blog has pointed out before, bells-and-whistles climate policy has a way of making it easy for countries to take strong positions in name only.

U.S. Coal Exports Jump Three-fold Since 2005 from Oil Price. This is the entirely predictable result of falling coal consumption due to the shale gas boom.  This announced just a day after a kerfuffle about Norway’s Store Norske opening a coal mine in its artic regions even as its sovereign wealth fund bans investment in coal companies. Robbing Peter to pay Paul is a nice way to appear current in sovereign carbon cutting; unfortunately given the global nature of carbon emissions, the collector will soon come around for us all.

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The U.S. Government Should Pay Attention to Uncertainties in the GHG Budget

Cornell professors Robert Howarth, Renee Santoro, and Anthony Ingraffea ignited a controversy in 2011 when they published a study claiming that, due to escaped methane, emissions from hydraulically fractured natural gas were worse than coal. Their study showed that the escaped gas amounted to four to eight percent of total gas production, more than twice the EPA’s estimate for the same figure.

Two different studies, one from Cornell and another from MIT, produced their own analyses criticizing Howarth et. al.’s claims on the grounds that their data set was too small, their assumptions incorrect. Both studies concluded that hydro fracturing leaked little gas. But both studies criticized Howarth et. al.’s assumptions by way of offering new assumptions, but no new data or measurements. Nothing was settled.

Carbon dioxide emissions—with the exception of emissions from transportation—come from large, industrial sources. By contrast, methane emissions leak out of hundreds of thousands of sources that include valves, pipes, landfills, and waste pools.  In oil and gas production, these emissions, known as ‘fugitive’, are just that; they steal out of the equipment and infrastructure and go uncounted into the atmosphere. The Environmental Protection Agency requires gas production, processing and transmission facilities to report fugitive emissions using emissions using estimates based on a predetermined calculation for leakage rates for each piece of equipment. But actual leakage rates can vary depending on the type of equipment, how it is maintained, the type and pressure of the gas that it conveys, and the geology of the formation from which it is withdrawn. The estimations are necessarily inexact. There are no direct measurements, and so much room for controversy.

Recently, the Environmental Defense Fund attempted to fill the data gap by coordinating a study that took direct measurements of gas flow back from wells. Results showed that wells constructed using advanced technology leaked only 0.42 percent of production—much less than Howarth et. al.’s or EPA’s estimates. But the study settled nothing due to skepticism due to over sample bias—companies that voluntarily cooperate with fugitive emissions studies are likely to be the best actors.

Then last month yet another study of fugitive methane emissions lead by Harvard claimed that emissions for the 2007-2008 period were 50 percent above the estimates used by the EPA for that year. The Harvard study is different to preceding studies in that it doesn’t rely on estimates or incomplete measurements, but rather uses to cell phone tower and airplane mounted instruments to detect the mass balance of methane in the air. The data is harder to quibble with.

The findings prompted Henry Waxman to call for hearings on methane emissions and global warming consequences of natural gas extraction. Given the current leadership of the House Energy and Commerce Committee, hearings are unlikely to happen. But methane emissions need more oversight. Uncertainties over methane leakage are just part its underreporting. New science on the global warming impacts of methane also point to it being a much larger portion of U.S. emissions than is currently reflected in U.S emissions inventories.

Methane emissions in the EPA inventory are not given in terms of tons of methane, but tons of carbon dioxide equivalent, or the potency of any gas a greenhouse forcer compared to carbon dioxide. Carbon dioxide equivalent is calculated through a conversion factor called Global Warming Potential (GWP). Estimation of the Global Warming Potential of a gas is complicated. The single number of Global Warming Potential is meant to capture the gas’s comparative power to absorb infrared radiation, its lifetime in the atmosphere and its indirect effects, including induced changes in tropospheric ozone, water vapor levels, and CO2 production. Most recently, the Intergovernmental Panel on Climate Change (IPCC), which sets the international standards recommended GWPs for gasses, has added climate feedback effects to the calculations.

The value of methane’s GWP has constantly changed as the science behind its derivation has evolved. In 1996 twenty-one was the IPCC’s recommended GWP for methane. Next year, the IPCC will revise its recommendations for methane’s GWP for the third time since 1996 from its current twenty-five to thirty-four. Methane numbers in the United States Inventories for Greenhouse Gasses and sinks, meanwhile, are still reported using the 1996 value of twenty-one. The EPA is in the process of updating the GWP for methane to twenty-five, the value recommended by the IPCC in 2007. The change will bring the United States emissions inventories up to the best available science of seven years ago, but leave methane emissions underreported by thirty-seven percent compared to the best available science of today.

The EPA decided to update to 2007 values in part to standardize with the recommendations of the United Nations Framework Convention on Climate Change (UNFCCC), which sets guidelines for international reporting. While it is valuable to be able to accurately compare the United States’ emissions to the rest of the world, it is arguably more important to have a realistic assessment of the comparative size and impact of different sources on a national level. Abatement decisions are not made on an international level, but driven by domestic energy interests and domestic regulatory assessments of significance, harm, and abatement costs within national borders. When numbers are skewed, there is a danger that decision-making will be skewed as well.

According to the EPA, total net emissions in the United States in 2011 were 5.75 billion tons of carbon dioxide equivalent. Of those emissions, methane constitutes 580 million tons, accounting for ten percent of total U.S emissions. If methane emissions in the United States are indeed underestimated by 50 percent, that would make them just over fourteen percent of total emissions. Incorporating the most accurate GWP—thirty-four—into the upward revised number for leakage, total methane emissions become 1.4 billion tons of carbon dioxide equivalent, or 2.4 times higher than emissions listed in the current national inventories, and twenty-one percent of total emissions. Even in the most conservative case where EPAs leakage rates are entirely accurate, if thirty-four were used as a conversion factor, methane would be reported as fourteen percent of total emissions.

Control of fugitive methane emissions is simpler than the control of carbon dioxide emissions. Halting carbon dioxide emissions in the United States will require that trillions of dollars infrastructure currently locked into fossil fuels be retired and further trillions of dollars be invested in development and construction of non-emitting energy technologies. By contrast, controlling fugitive methane emissions requires that simple and already existing technologies be installed at a profit to the companies that install them.

The failure to control fugitive methane despite the obvious benefits is a typical failure of energy efficiency to be effected. There are many reasons why large industries waste energy—and therefore money—including poor incentive structures, higher rates of return on an investment in the company’s main line of business than on investment in efficiency improvement, or poor understanding of where and how the gains are to be made.

But in addition to wasting private money, energy inefficiency imposes a cost on the public through higher emissions and climate change. In the case of methane emissions through natural gas losses, the cost is thirty-four times higher than that of carbon dioxide for every ton of emissions wasted.

Given the high cost to the public of methane emissions, the low cost of regulation to the emitters, and the continued failure of the market to stimulate action, there is a clear case for controlling emissions through regulation. President Obama has highlighted methane as a problem, saying a June 2013 speech, “We’ll keep working with the industry to make drilling safer and cleaner, to make sure that we’re not seeing methane emissions…” But the President’s Climate Action Plan has no specific plans for controlling methane. It calls in general terms for interagency partnerships to reduce methane emissions in agriculture, oil and gas. Concrete plans for controls are yet unarticulated.

In referencing cleaner drilling, President Obama was referring to the EPA’s promulgation of New Source Performance Standards for the oil and gas production. The new regulation puts controls on certain wells, compressors, valves, and storage tanks upstream of processing. Gas wells with ‘green completions’ are the type of infrastructure that the Environmental Defense Fund monitored in its study showing a loss rate of 0.42 percent. The study is also the reason why many companies are claiming that Harvard study showing high leakage from the 2007-2008 period is outdated. The EPA’s New Source Performance Standards are not designed to control methane. They are designed for the control of hazardous and toxic pollutants such as benzene and xylene that are components of natural gas when it is extracted, but are removed during processing. Some methane is controlled as an ancillary benefit, but it is not the principal intent of the regulation. Thus, upstream of processing only very specific installations with high air toxics emissions are targeted. Installations downstream of processing are not affected by the regulation at all.  But about half of methane leaks from oil and gas production occur downstream of production. But EPA’s own estimate, this regulation will prevent between 1 and 1.7 million tons of methane emissions in the future, or between 3 and 5 percent of present day volume as reported by the EPA.

The EPA reports that emissions have dropped 12 percent since 2005. But even through conflicting reports, it is clear that the real magnitude of reductions remains unknown. Information increasingly points to methane emissions being a more serious component of the U.S. emissions than previously believed. The government needs to start taking the problem seriously, first through accurately reporting the emissions, and then through promulgating methane-targeted policy that controls emissions, rather than relying on regulations that were written without methane in mind.

This article was first posted on The Energy Collective.

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