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On Learn to Explain the Basics of the Power Grid

Sarah, it's true that solar panels don't explode (most deaths from solar are the result of falls from rooftops during installation). The fact is that while most people harbor an irrational fear of radiation, nuclear is five times safer than solar per unit of energy generated, it occupies a tiny fraction of the land area, and delivers power with six times the capacity factor, day or night, rain or shine.

While powering the world on renewables alone is theoretically possible, from a practical standpoint the chances of doing so are zero. It would cost hundreds of $trillions in 2014, and there's no evidence that the price will drop fast enough or that a buildout could happen fast enough to keep pace with the exploding global demand for energy. The graph below makes that evidently clear - wind's contribution to world electricity is the skinny purple line, and solar's contribution is invisible.

This is what I mean by reinforcing misperceptions. It's critical that we examine our energy options on a factual basis, and not one of popular culture myths which persist four decades after The China Syndrome if we're going to have a chance of getting a handle on climate change.

August 1, 2014    View Comment    

On Utility Industry: We Need to Promote Electric Vehicles in Order to 'Remain Viable'

Stephen, as challenging is it is for renewables to gain a foothold in current utility generation, their share will be even less when EV adoption is widespread (most EV charging occurs at night, when solar generation is conspicuously unavailable).

In the past you've taken it upon yourself to cheerlead the utility "death spiral". Does that place GTM solidly in the anti-EV camp?

August 1, 2014    View Comment    

On Fuel Stability Problems Challenge FAME Biodiesel

Ed, besides damage to engine components, it seems that degradation of any biofuel which has lived in a tank for a while would reduce engine efficiency, eventually resulting in higher emissions than burning pure diesel.

To your knowledge does emission testing on biofuels typically compensate for that effect?

August 1, 2014    View Comment    

On Learn to Explain the Basics of the Power Grid

Sarah, reducing the grid to simple terms is not an easy task, and overall I think you've done a good job. I will take you to task on

Some plants may also use nuclear power to generate electricity, but this method is relatively expensive and may be hazardous to human health and the environment.  To avoid burning through our supply of fossil fuels and possibly inflicting damage to the surrounding area, the hot new trend is clean energy.  Wind, solar, geothermal, biomass, and hydroelectric power are all forms of renewable energy that will keep our planet clean and functioning properly.

Here you reinforce several common misperceptions:

  • Every form of electricity generation may be hazardous to human health, and singling out nuclear doesn't accurately reflect statistics on its relative hazard to that of coal, natural gas, or oil. Per unity of energy generated, nuclear is comparable to solar in terms of safety, and thousands of times safer than coal.
  • Nuclear is relatively expensive compared to wind, hydro, and natural gas, but one-third cheaper than PV solar, less than half the price of offshore wind, and about the same price as conventional coal. While many consider clean energy from renewables a "hot new trend", nuclear has been generating 100% carbon-free energy since the 1950s.
  • The percentage of climatologists who believe wind, solar, geothermal, biomass, and hydroelectric power alone will "keep our planet clean and functioning properly" is roughly the same as those who believe anthropogenic global warming is a myth.

That those two views represent a similar share of consensus may or may not be coincidental.

August 1, 2014    View Comment    

On When Politics Constraints Carbon Pricing, Part 3: Why Carbon Revenues are Just as Important as "Putting a Price on Carbon"

Jesse, Van Hollen introduced a similar bill in 2009. It was referred to the House Energy and Commerce Committee, where it died. No surprise - chair Fred Upton has a solid pro-fossil voting record. We can expect the same result this time around.

It appears that Van Hollen was trying to create some kind of cap-and-trade/revenue-neutral hybrid, but the end product doesn't make a lot of sense. Exporters are effectively exempt from the tax, so coal exports would likely soar; simplicity - one of the B.C. law's best features - is mucked up with permits, auctions, exemptions, a cap, and convoluted rules like

If the auction price for carbon permits increases by more than 100 percent above the average auction price for carbon permits during the preceding two years (or, if before the third year for which auctions are conducted, the average auction price for carbon permits during the preceding auctions), the Secretary shall auction as many additional carbon permits as are necessary to stabilize the auction price, not to exceed 8 percent of the total amount of carbon permits otherwise available at that auction...

It doesn't have to (or should) be this complicated. With some well-crafted legislation, RNT's will stand a chance in a committee awash in fossil fuel influence.

July 31, 2014    View Comment    

On When Politics Constraints Carbon Pricing, Part 3: Why Carbon Revenues are Just as Important as "Putting a Price on Carbon"

Arthur, thanks for much useful information.

I believe WTP polling suffers from a negative bias about paying extra for anything, but particularly another tax. How would consumers respond to a 5% rise in gasoline prices, compared to the same expense labeled a "tax"? A better metric are satisfaction polls, which take the overall perception of the tax into account. Included is the satisfaction from making a contribution to the environment (although that's easy to overestimate: this study shows the environment was a primary purchase consideration for only 27% of Toyota Prius buyers). Most importantly, overall satisfaction is a metric with distinct advantages for political candidates, and a 2012 poll showed 64% public approval.

In response to

what ... will be needed to keep the price of fossil fuels high to mitigate rebound when we eventually successfully reduce demand on coal/oil/gas?

You raise the tax. There's no theoretical limit to how high such a tax could go as behaviors change, but all of the factors you cite: industrial/commercial competitiveness / first mover pain / carbon leakage / growing pains are potential obstacles, and at this stage of the game it makes sense to tread lightly.

Here, a recent article in the Guardian contrasting B.C.'s tax with Australia's ill-fated, revenue-positive one.

July 30, 2014    View Comment    

On InsideClimate News Responds to Steve Everley of Energy in Depth

Steve, after reading your rebuttal I agree Inside Climate's reporting leaves a lot to be desired. There's no shortage of fast and loose hyperbole flying about which, with the substitution of a few keywords, would be equally appropriate broadcast through the megaphones at an anti-nuclear rally.

I don't support any new fossil fuel development, but it's important to recognize that fracking is not the worst offender - by far - and ICN is going to have to come up with more substantive criticism if they want to win people over.

July 29, 2014    View Comment    

On When Politics Constraints Carbon Pricing, Part 3: Why Carbon Revenues are Just as Important as "Putting a Price on Carbon"

Jesse, regarding

If you tried to implement the BC tax shift approach elsewhere, in regions with a higher carbon footprint per household, you'd wind up with a much lower and thus less effective carbon tax.

It wouldn't be difficult to modify the tax to account for an area's generation mix, so that after incorporating taxes on all fossils - coal, natural gas, and gasoline - the overall "hit" to households would be more or less the same, generating the same per capita revenues and rebates. Nonetheless, some discrepancy between areas with a high percentage of coal generation vs. gas, nuclear, or hydro is a good thing. It's what will make clean energy more competitive - and thus more profitable for utilities and less burdensome on consumers.

The RGGI has been criticized for playing a carbon shell game which effectively exports emissions to other areas of the country or world, and I've seen estimates suggesting actual reductions in GHGs by 2020 will be less than 1%. This is the Achilles' Heel of cap-and-trade - its complexity is a magnet for loopholes, exemptions, and other shenanigans.

And if you spend all of your revenues on tax rebates instead of investing in clean energy R&D and additional abatement, you will accomplish little else.

I don't doubt that RGGI has raised billions in revenues and funded programs which have helped increase efficiency. What would be the effect of those $billions in the hands of homeowners, enabling them to make efficiency improvements to their homes and buy fuel-efficient cars? This point makes RNTs more saleable to conservatives: investment comes from the bottom up, puts spending in consumers' hands, and capitalizes on an incentive to save money.

July 28, 2014    View Comment    

On When Politics Constraints Carbon Pricing, Part 3: Why Carbon Revenues are Just as Important as "Putting a Price on Carbon"

Jesse, this is exceptional work you've done - all accurately sourced, notated, and explained. That you, Schalk, and other younger posters on TEC are applying your talents and intellects to the search for solutions to these grave problems is encouraging.

Those of us with a few more tree rings are perhaps more wary of theoretical constructions, and view the incorporation of real-world experience as more essential to the process. On the topic of revenue-neutral taxes, I admit I was disappointed when instead of discussing recent empirical data on B.C.'s economy and gasoline consumption you concentrate on Canadian polls and political failures of six years ago. A lot has changed since then.

As real-world experience comes in typically models undergo a process of refinement. Variables are re-weighted, and in some cases new ones are added which had gone previously unforeseen. I think you've missed some of these variables and they're important ones. Examples:

  • Willingess-to-pay surveys represent customer estimations of values. What evidence is there to suggest buying habits accurately reflect these estimates? It seems likely that respondents would view this question as relating to discretionary purchases, and not essentials like gasoline, utilities, etc.
  • In responses to the past two installments of your series, recurring themes are mistrust of government and the potential for fraud/diversion of funds to other uses. Complexity foments this mistrust by limiting accountability, and very few voters have any understanding of cap-and-trade is to begin with. Is their an assignable value to simplicity vs. complexity of public programs and its affect on public perception? If so, should it be included in the calculus?
  • To what extent does an income tax break or cash payout negate a perceived hit from taxation, especially when it follows in close proximity to the hit?

The success of B.C.'s carbon tax - a 16.1% reduction in gasoline consumption with no harm to its economy - could be the result of similar considerations which have largely been ignored to date. The strategy is getting good reviews from across the ideological spectrum, including this endorsement in The American Conservative, and a recent poll by the Pembina Institute showing 64% of business and community leaders believe the tax has been "a positive move".

Given B.C.'s impressive results the question we should be asking is not "How can we construct a carbon mitigation strategy which will be workable and effective?", but "What is it about B.C.'s program which might not translate to a similar effort in the U.S.?"

July 28, 2014    View Comment    

On Why Does Politics Keep Getting in the Way of Pricing Carbon? - Part 1

Durwood, that the study's authors admit other factors may be at work is a hallmark of good science. They're forcing themselves to come up with other plausible explanations, then procedurally investigating them and concluding that they're less likely to explain the decrease in consumption than is the tax.

Which one(s) do you find unconvincing (it's possible to justify any explanation, no matter how farfetched, on the basis of imaginary "unknowns")? Do you have evidence of a motive for bias in the study, or is your accusation a product of the authors coming to a verdict which challenges your preconceptions?

The report directly addresses declining driving miles by performing a comparison with other provinces, which are likely to have a similar incidence of online shopping and sales of fuel-efficient cars. To successfully advance your argument, you'd have to show that B.C. has moved toward online sales or fuel-efficient cars at a disproportionate rate compared to other provinces (it's possible they have). Is that something you're prepared to do?

Finally, no one is making "a few bucks at the expense of the many" with a revenue-neutral tax. You may be surprised to learn that revenue-neutral taxation is being embraced by conservatives who accept the science on global warming, but resist the idea of expanding govenment to combat it. How to Tax Carbon, from The American Conservative:

Adopting a revenue-neutral carbon tax with regulatory preemption will do two very important things. The first is to provide a counter to liberal big-government policies that are already underway: conservatives currently are utterly absent from an important policy debate that will advance without their input. The second is to establish a tax code that is more pro-growth. Eliminating onerous EPA regulations and swapping out taxes on positive things like investment in favor of taxes on energy use would lighten the load placed on businesses and individuals by the federal government, giving the U.S. a larger and more vibrant economy to help absorb future climate impacts.

The good news is that this debate isn’t entirely theoretical. There are various forms of carbon taxes already in effect around the world. Perhaps the example most comparable to the policy described here is in the Canadian province of British Columbia. That province has had a tax on carbon emissions since 2007, a levy now set at 30 Canadian dollars per metric ton, with the revenue devoted to reducing other taxes. 

Early returns on the policy are quite positive. A recent study found that the province’s gross domestic product growth has outpaced the rest of Canada, while its corporate income tax rate has been reduced to among the lowest anywhere in the G8 countries. Despite concerns that it might grow government, the tax has stayed revenue neutral and enjoys broad public support. Polling of business and community leaders by the Pembina Institute found 64 percent believe the tax has been a positive move.

July 27, 2014    View Comment    

On Why Does Politics Keep Getting in the Way of Pricing Carbon? - Part 1

Durwood, there is no system that is 100% efficient. That includes innovation - the vast majority of efforts thereof result in wasted resources and time. As far as tolls go, roads everywhere require maintenance, and in the northern U.S. there's a lot of it. I'd rather revenue came from states' general funds, with a corresponding rise in taxes - whether you drive on them or not, they benefit everyone in the state. But given your comments about the IRS, I'm assuming that's not an option either.

Money does not grow on trees.

There's nothing at all immeasurable, intangible, or subjective about the 17% (actually 16.1% as of 2014) drop in gasoline usage - it's confirmed by Canadian government statistics. Usage has dropped even more relative to the rest of Canada - 19.1%. If you have any specific criticism of the methodology used to obtain that number I'd like to hear it. If not, you have to admit that's worth a lot more than good intentions.

The lack of damage to BC's economy is similarly well-documented at the link above, and I'd urge you to read up on it before simply pronouncing that it's non-quantitative or "just an opinion":

The carbon tax’s environmental accomplishments are certainly noteworthy, but many people are even more excited about how the economy has responded. While the levy is the highest of its kind in the world, the regional economy has still continued to grow on pace with, and in the last couple of years slightly faster than, the rest of the country. Researchers from Sustainable Prosperity caution that saying the tariff has led the economy to grow would be pure speculation. But just showing that a carbon tax doesn’t flat-line the economy is remarkable, considering that for years, vested interests have been claiming such a measure would cause economic collapse.

July 27, 2014    View Comment