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Quote of the Day, July 2nd 2009
"As it stands now, the amount of money dedicated to coal in [the Waxman-Markey climate] bill is remarkable, and the future of coal will be intact."-Phil Smith, communications director, United Mine Workers of America union [via Coal Tattoo] Quote of the Day, July 1st, 2009
"There is no way India is going to accept any emission reduction target, period, between now and the Copenhagen meeting and thereafter... India will not accept any emission-reduction target -- period. This is a non-negotiable stand." --Indian Environment Minister Jairam Ramesh, June 30, 2009 (Bloomberg News) Regulate to Innovate?
President Obama's top energy aides repeated the well-worn myth that past regulation has been a major driver of energy innovation while neglecting to mention the wholly inadequate clean energy R&D investments in the ACES climate bill.
Flanked by Energy Secretary Steven Chu and Carol Browner, the administration's Energy and Climate 'Czar,' President Obama discussed his thoughts Monday on the House of Representatives' recent passage of the ACES energy and climate bill. Secretary Chu stuck, for the most part, to his favorite talking point: comparing US energy policy to the hockey playing of Wayne Gretzsky. We need to play policy like the latter played hockey, Chu is fond of saying, by concentrating on where the puck is going to be rather than where it is at the moment. Browner (joined at one point by Chu) continually, and almost dogmatically, asserted that prior regulation had successfully spurred rapid innovation and transformed industry. According to Browner: "That story can be told time and time again about environmental rules, that's probably the clearest -- same thing for CFCs. The Senate decided to ban -- the bill banned CFCs, there wasn't a replacement via the guaranteed market -- the investments were made, the replacements came forward, it was cheaper, much more quickly than we thought." (via NYT) Browner believes it was the Senate that regulated CFCs and, thereafter, industry that responded. Regulation breeds innovation and successful policy goals, Browner clearly maintains. The truth of the matter is far subtler. The Clean Air Act Amendments of 1977 only banned non-essential use of CFC's, and it was not until the Dupont Corporation had long acknowledged that it had developed a CFC substitute that the international Montreal Protocol banned their use entirely. The real story here was that innovation bred (or at least enabled) regulation, not the other way around. Critics Condemn ACES Climate Bill
After the House passed the ACES climate bill last Friday, several critics are questioning the strength of the bill.
By Johanna Peace, Breakthrough Fellow The American Clean Energy and Security Act passed in the House this Friday by a narrow margin of 219-212, and US lawmakers immediately began patting themselves on the back. Rep. Henry Waxman touted the bill as "decisive and historic action to promote America's energy security and to create millions of clean energy jobs that will drive our economic recovery and long term growth." Some international observers joined in the praise, expressing levels of support varying from China's cautious endorsement to the EU's enthusiastic approval; some hailed the bill as a sign of commitment by the US, likely to encourage efforts toward a workable international climate treaty in Copenhagen. Coverage in the UK's Guardian introduced ACES favorably as "a milestone," "the first time either house of Congress had acted to reduce the carbon emissions that cause climate change," and quoted environmentalists who called the bill "a signature achievement." Criticism of Cap and Trade But not everyone's so excited. Among the critics speaking up against Waxman-Markey, Todd Darling wrote in the LA Times that the newly passed climate bill is full of "smoke and mirrors." We only have to look to Europe to see the "critical weakness" of a cap and trade plan that gives away too many pollution credits, Darling argues; and since ACES gives 85% of credits to polluting industries for free, it won't establish a strong carbon market, won't result in emission reductions, and won't generate money to fund new technology. Brookings Institution: Senate Must Strengthen Clean Energy Funding in ACES
The American Clean Energy and Security Act (ACES) needs a major makeover in the Senate to redress its critically insufficient provisions for funding clean energy R&D, according to Mark Muro, policy director at the Brookings Institution's Metropolitan Policy Program.
By Johanna Peace, Breakthrough Fellow The American Clean Energy and Security Act (ACES) that passed by a margin of 219-212 in the House on Friday needs a major makeover in the Senate in order to redress its critically insufficient provisions for funding clean energy R&D, according to Mark Muro, policy director at the Brookings Institution's Metropolitan Policy Program. In a Brookings article criticizing the climate bill, Muro argues: "While a $20 to $30 billion a year R&D outlay would be optimal, Waxman-Markey would invest just 1.5 percent of the 40-year revenue stream of the cap-and-trade system in the R&D efforts of ARPA-E and the innovation hubs--which comes to just $1.4 billion a year or so at accepted permit price forecasts... The bottom line: Reps. Waxman and Markey did well to install several crucial innovation provisions in the House bill, but the political trades that were required to pass it have left far too little revenue behind for the most crucial use of cap-trade money--investments to catalyze a radically cleaner energy future."Muro's points reaffirm Breakthrough Institute's analysis, which has shown how ACES invests far more cap and trade revenue in polluting industries and foreign offsets than it does in building new clean energy industries in the U.S. Muro mentions that some ACES provisions -- such as the funding it would direct toward ARPA-E and the eight regional "Energy Innovation Hubs" it would establish -- constitute a modest start toward the kind of public investment that will promote the development and commercialization of clean energy technologies. Breakthrough Institute, too, has pointed to some of the same provisions as promising -- but only if they are adequately funded. Continue reading "Brookings Institution: Senate Must Strengthen Clean Energy Funding in ACES" » Rep. Waxman Responds to Breakthrough Institute, Criticizing Public Investment and Praising Offsets
On a morning radio show, Congressman Waxman responded directly to the Breakthrough Institute. His response raises concerns about whether ACES can be significantly strengthened in the Senate.
Earlier today, Congressman Henry Waxman was asked to directly respond to the Breakthrough Institute's analysis of the American Clean Energy & Security Act (ACES) during an interview on the Montel Williams Across America radio show. His segment came after my interview on the same show, where I highlighted Breakthrough's analysis and spoke about some of our concerns with the bill. Listen to Teryn Norris interview with Montel: Listen to Rep. Waxman interview with Montel: Below is a transcript of Waxman's response (starting at 8:00 minutes, podcast also available here). Rep. Waxman is Chairman of the House Committee on Energy and Commerce and lead author of the ACES climate bill: Montel Williams: "Teryn Norris from the Breakthrough Institute and several other people say that this [bill] is based on credits that would be given out and traded by companies to meet their carbon footprint - I'm being told that 85% of these are being given away when they could have been auctioned off, which would have been a revenue source that could have been put toward more forms of renewable energy. Why did we decide to give away these credits rather than auction them off?" Democratic Congressmen on ACES Climate Bill: "Doing nothing actually results in more renewable energy than approving ACES"
Rep Doggett (D-TX): "Doing nothing actually results in more renewable energy than approving ACES... I cannot support it."
Representative Doggett (D-TX): "Doing nothing actually results in more renewable energy than approving ACES... Largest corporate welfare program in US history... I cannot support it." Rep. Doggett is citing analysis by the EPA, which found that ACES would reduce the amount of renewable energy deployed in the United States relative to business-as-usual, increase the amount of coal-fired electricity generation relative to 2005 levels, and provide no incentive for a move to cleaner cars. Update: After intensive pressure from the House Leadership, White House and advocates of Waxman-Markey, Representative Doggett later decided to cast his vote in favor of the bill, although he did not rescind any of his statements about the flaws and inadequacies of the legislation. Representative DeFazio (D-OR): "Wall Street predicts this is the new trillion dollar market." Rep. DeFazio echoes a recent study by Friends of the Earth, which found that "the federal cap and trade proposals put forth so far would create a system that poses almost identical challenges as those in the mortgage-lending industry." And, finally, tried and true progressive Dennis Kucinich (D-OH), who ultimately voted against the bill, had this say: "I oppose H.R. 2454, the American Clean Energy and Security Act of 2009. The reason is simple. It won't address the problem. In fact, it might make the problem worse. "It sets targets that are too weak, especially in the short term, and sets about meeting those targets through Enron-style accounting methods. It gives new life to one of the primary sources of the problem that should be on its way out- coal - by giving it record subsidies. And it is rounded out with massive corporate giveaways at taxpayer expense. There is $60 billion for a single technology which may or may not work, but which enables coal power plants to keep warming the planet at least another 20 years. "Worse, the bill locks us into a framework that will fail." (get the full text of Kucinich's address here) Letter to Obama & Congress: $30 billion Annually Needed for Energy Technology
Leading energy experts from across the country sent a letter to President Obama and members of Congress on Thursday calling for a massive increase in clean energy investments included in the American Clean Energy & Security Act.
Leading energy experts from across the country sent a letter to President Obama and members of Congress on Thursday calling for a massive increase in clean energy investments included in the American Clean Energy & Security Act. "We express our profound concern about the abysmal funding for energy technology innovation in the Waxman-Markey American Clean Energy and Security (ACES) Act," the energy experts wrote. "As it stands, this Act ignores President Obama's consistent call for investing $150 billion over ten years in energy research and development." Analysis by the Breakthrough Institute has shown that ACES invests only one-fifteenth of what President Obama has consistently promised for energy R&D. As Michael Shellenberger and Ted Nordhaus wrote today, "While the White House web site still promises $15 billion annually for clean energy R&D alone, the House climate legislation would invest just $800 million to 1.4 billion in R&D." The energy experts called for a clean energy RD&D budget of $20-30 billion annually. "Moreover, we believe that at least $30 billion will be needed annually to research, develop, and demonstrate low- and no-carbon energy technologies, with the aim of achieving breakthroughs that can make them much cheaper." This letter echoes the recommendations of the Brookings Institution, International Energy Agency, Apollo Alliance, Breakthrough Institute, and others. In late 2007, 30 energy experts including several Nobel Laureates wrote a letter to Congress calling for $30 billion of annual investments in clean energy RD&D. The full letter is here: Continue reading "Letter to Obama & Congress: $30 billion Annually Needed for Energy Technology" » Obama Energy Promises Not Matched by House Energy Bill
While the White House web site still promises $15 billion annually for clean energy R&D alone, the House climate legislation would invest just $800 million to 1.4 billion in R&D.
Since he launched his campaign for president in 2007, President Barack Obama has promised legislation that would deliver more clean energy jobs through the creation of new and larger clean energy industries, like solar and wind manufacturing, to drive future economic growth. On Tuesday and again yesterday, Obama claimed that climate legislation to be voted on as early as tomorrow in the House of Representatives legislation "will create a set of incentives that will spur the development of new sources of energy, including wind, solar, and geothermal power." But analyses by the Environmental Protection Agency, the Union of Concerned Scientists, the Breakthrough Institute, and others show that the Waxman Markey climate legislation will not significantly grow the number of clean energy jobs or industries. The EPA analysis released on the same day as Obama's speech shows that the deployment of renewables could be less than without the legislation. An analysis of the renewable energy standard (RES) provision of the legislation by the Union of Concerned Scientists, whose model of various RES exemptions is the most thorough, finds that the legislation could actually require less renewables deployment than projected to occur under the U.S. Energy Information Administration's conservative business-as-usual forecasts. And EPA says the impact of the legislation on gasoline prices ($0.13 a gallon in 2015, $.25 in 2030) will be too small to motivate consumers to drive less or buy smaller cars, or provide incentive for the automotive industry to produce more fuel efficient and technologically advanced vehicles like plug-in hybrid cars. Continue reading "Obama Energy Promises Not Matched by House Energy Bill" » Climate Bill Analysis Part 18: Understanding EPA's Analysis of the ACES Renewable Electricity Standard
The U.S. EPA projects renewable energy sources like wind, solar and biomass will generate just 9% of U.S. electricity by 2020 under the Waxman-Markey renewable electricity standard.
The U.S. Environmental Protection Agency projects renewable energy sources like wind, solar and biomass will generate just 9% of U.S. electricity by 2020 under the Waxman-Markey renewable electricity standard (RES). This contrasts with the bill's nominal 20% combined efficiency and renewable electricity standard due to numerous exemptions in the standard. Total renewable electricity generation under EPA's modeling of Waxman-Markey with the renewable electricity standard is just 41 terawatt-hours (or 7%) higher than the Agency's business as usual projections. Yesterday, the Breakthrough Institute examined several of the surprising assumptions and projections underlying the EPA's "core scenario," which projects the impacts of the Waxman-Markey bill's efficiency and cap and trade provisions. This core scenario's conclusions about the likely cost impacts of the Waxman-Markey bill have been widely cited, and Breakthrough delved into this scenario in our last post. As we reported, EPA concludes that the expansion of new wind farms, solar arrays and other renewable energy power plants will actually be somewhat slower under their core scenario for Waxman-Markey than under their BAU projections [p. 27]. Total renewable electricity generation under their core scenario is somewhat higher (3%) in 2025 under Waxman-Markey than in their BAU scenario, but this extra generation comes in the form of biomass co-firing at existing coal-fired power plants, EPA predicts [p. 26]. However, EPA's core scenario does not attempt to model the impacts of the Waxman-Markey bill's RES. EPA apparently decided they were not confident enough in their results to include the effects of the RES in their core scenario and chose to model it instead as a "sensitivity analysis" for the power sector only. Here we look at their projections for the impacts of the bill's RES. | |
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