Recent Studies Provide Examples of Emissions Trading Successes, Failures

August 27, 2015
The Nicholas Institute for Environmental Policy Solutions at Duke University

The Nicholas Institute for Environmental Policy Solutions at Duke University

The emissions trading program in the northeastern United States—the Regional Greenhouse Gas Initiative (RGGI)—is responsible for about half the region’s emissions reductions—an amount far greater than reductions achieved in the rest of the country.

The study in the journal Energy Economics determined that even when controlling for other factors—the natural gas boom, the recession, and environmental regulations—emissions would have been 24 percent higher in participating states without RGGI (subscription). RGGI, the first market-based regulatory program in the United States, is a cooperative effort among states to create a “cap” that sets limits on carbon dioxide emissions from the power sector—a cap lowered over time to reduce emissions. Power plants that can’t stay under the cap must purchase credits or “emissions allowances” from others that can.

“While the study focused on the northeastern states and the RGGI program specifically, the findings suggest that emissions trading could be a cost-effective strategy for states now considering how to comply with EPA’s recently issued regulations aimed at reducing carbon dioxide from power plants,” said Brian Murray, lead author and director of the Environmental Economics Program at Duke University’s Nicholas Institute for Environmental Policy Solutions.

A separate study in the journal Nature Climate Change found significant misuse of a key carbon offsetting scheme after several factories increased their production of industrial waste products—spiking emissions. It suggests that a loophole in the United Nation’s carbon market may have led to “perverse incentives” for some industrial plants to increase emissions so they could then make money by reducing them.

A companion study indicates that the majority of credits from Russia and Ukraine were a sham and that no emissions were reduced. In fact, the study estimates use of the sham offsets actually enabled greenhouse gas emissions to increase by some 600 million tons of carbon dioxide equivalent.

“We were surprised ourselves by the extent, we didn’t expect such a large number,” said study co-author Anja Kollmuss. “What went on was that these countries could approve these projects by themselves there was no international oversight, in particular Russia and Ukraine didn’t have any incentive to guarantee the quality of these credits.”

Study Quantifies Global Warming’s Contribution to California’s Drought

How much of California’s drought is due to climate change? A study published in Geophysical Research Letters has an answer: up to 27 percent. The study also indicates that climate change has made the odds of severe droughts twice as likely.

Global warming has worsened the drought through increased evapotranspiration, the contribution of which was quantified in detail for the first time by researchers at the Lamont-Doherty Earth Observatory, the National Aeronautics and Space Administration, and the University of Idaho who analyzed 432 combinations of precipitation, temperature, wind, and radiation data gathered between 1901 and 2014 to simulate monthly changes in soil moisture across California. When they modeled these combinations against various greenhouse gas emissions scenarios, they concluded that the state’s lack of rainfall is due to natural variability—a finding that accords with most other studies—but that California’s drought is 8 to 27 percent drier because of human-cause climate change (subscription).

“By knowing how much global warming has contributed to the trend in California drought conditions over the past century, we can reliably predict how the future will play out,” said A. Park Williams, a bioclimatologist at Lamont-Doherty who led the study. By the 2060s, Williams said, drought conditions will be more or less permanent, and evaporation will overpower bursts of intense rainfall.

Williams likened climate change to a “bully” that every year “demands more of your money than the year before. Every year, the bully—or atmosphere—is demanding more resources—or water—than ever before.”

He also said that California should more aggressively police groundwater withdrawals by agricultural operations, increasing use fees and fines for overuse. California is one of the few states that does not regulate such withdrawals, which after three years of drought have led to precipitous drops in groundwater tables and land subsidence.

Obama Announces Renewable Energy Initiatives

In the first stop on an 11-day climate and energy tour, President Obama announced a number of initiatives aimed at making it easier for homeowners and businesses to invest in clean energy technology.

“We are here today because we believe that no challenge poses a greater threat to our future than climate change,” said President Obama at the National Clean Energy Summit in Las Vegas. “But we’re also here because we hold another belief, and that is, we are deeply optimistic about American ingenuity.”

According to a White House fact sheet, these measures include:

  • $24 million for 11 projects in seven states to develop innovative solar technologies that double the amount of energy each solar panel can produce.
  • Approval of a transmission line for a 485-megawatt photovoltaic facility planed for Riverside County.
  • An additional $1 billion in federal loan guarantees available through a federal program for innovative versions of residential solar systems.
  • Creation of the Interagency Task Force to Promote a Clean Energy Future for All Americans.
  • Provision of residential Property-Assessed Clean Energy financing that facilitates investment in clean energy technologies for single-family homes.
  • Creation of a new HUD and DOE program to provide home owners with a simple way to measure and improve their homes’ energy efficiency.

Energy Secretary Ernest Moniz said federal support is critical as the clean-energy industry seeks to become further established, noting “The playing field is not always as level and that’s where investors and developers can have risks. That’s where things like our loan program come in.”

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

Challenges Ahead for Clean Power Plan, Another EPA Rule

August 13, 2015
The Nicholas Institute for Environmental Policy Solutions at Duke University

The Nicholas Institute for Environmental Policy Solutions at Duke University

Less than two weeks after President Obama announced the U.S. Environmental Protection Agency’s (EPA) final Clean Power Plan rule, aimed at cutting carbon emissions from existing power plants 32 percent from 2005 levels by 2030, EPA Administrator Gina McCarthy has encouraged states to comply with the plan through emissions trading opportunities—emphasized far more in the final rule than the draft proposal.

It appears that some states may be examining whether they have trade-ready elements in common with other states. If so, they will be able to swap emissions credits with those states in order to comply with the rule.

“There’s been a lot of discussion, particularly in the West, where states are more loosely connected across the electricity grid, about an arrangement where states could adopt some common elements, and thereby allow the compliance entities in that state to trade among states that might not have submitted a joint plan but still have common elements in their plans,” said Colin McConnaha, a greenhouse gas specialist with the Oregon Department of Environmental Quality.

Despite the final rule’s flexibility, legal challenges are expected (subscription). Bill Bumpers, a partner at a law firm representing power companies, estimates 22–26 states are considering such challenges, a decision he called “more political than practical.”

The focus of many of these legal challenges, in my opinion, may very well be section 111(d) of the Clean Air Act. I spoke with MetroNews Talkline on this issue Wednesday, noting:

“The way the Clean Air Act is set up is that the traditional pollutants like ozone and particulates are regulated under one provision, what they call the hazardous air pollutants like mercury are regulated in a second provision and then there is this third provision, 111 that says if it is not covered under one of the first two then you regulate under 111(d) … Section 111 (d) has been rarely used over history because there hasn’t been a pollutant like CO2 in the mix. So that gives the EPA a lot of flexibility in how it executes because there are not years of precedent, but it also gives them some uncertainty in how the courts are going to interpret it.”

That flexibility may not be so clear for another EPA rule that a group of 16 states and the North Carolina Department of Environment and Natural Resources are challenging.

At issue—whether states can provide exemptions from emissions limits during periods of startup, shutdown, and malfunction. The court filing states “specifically, EPA erroneously concluded that the following State’s EPA-approved State Implementation Plans are ‘substantially inadequate’ with respect to periods of startup, shutdown and malfunction and must be revised.”

Carbon Emissions from Electric Power Plants Hit 27-Year Low

The U.S. Energy Information Administration (EIA) said those same emissions that the Clean Power Plan is trying to diminish hit a 27-year low in April (subscription). Figures released Wednesday show that electric power plants emitted 141 million tons of carbon dioxide in April 2015, the lowest since April 1988.

A big factor in the drop is the long-term shift from coal to cleaner and cheaper natural gas, according to EIA Economist Allen McFarland, who downplayed the role of, economic sluggishness. “You don’t have a 27-year low because of an economic blip. There are more things happening than that,” McFarland said, noting that the price of natural gas has dropped 39 percent in the past year.

Increased renewable fuel use and energy efficiency are additional factors, say other experts, including Princeton University Professor Michael Oppenheimer, who also highlighted the role of regulation.

“A factor behind all these trends is that the writing is on the wall about the future of coal and thus the future of U.S. carbon dioxide emissions,” said Oppenheimer. “The regulatory noose is tightening and companies are anticipating a future with lower and lower dependence on fossil fuels and lower and lower carbon dioxide emissions.”

Federal analysts predict that this year the amount of electricity from natural gas will increase 3 percent compared to 2014 while power from coal will go down 10 percent.

Significant changes in the electric power sector fuel mix since April 1988 have made electricity generation less energy and carbon intensive. Some analysts point out that power plant emissions have already fallen by about 15 percent since 2005, putting the country halfway to the Obama administration’s goal before the Clean Power Plan goes into effect.

Spring Release for Changes to MATS Rule

Court-mandated changes to the Mercury and Air Toxics Standard (MATS) rule, which requires coal-burning power plants to reduce emissions of toxic pollutants by installing control technologies, are expected by the EPA in 2016.

The EPA wrote in a filing with the U.S. Court of Appeals for the District of Columbia Circuit that it “intends to submit a declaration establishing the agency’s plan to complete the required consideration of costs for the ‘appropriate and necessary’ finding by spring of next year.” The Supreme Court ruled this summer that the Clean Air Act required the EPA to consider the costs of MATS when determining whether it was “appropriate and necessary” to regulate mercury emissions from the power sector.

In the filing, EPA lawyers note that there is “extensive documentation” of the cost of MATS. The rule will remain in effect while the lower court determines whether to vacate it as the EPA works on the cost issue, Detroit News reports.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

Final Clean Power Plan More Ambitious, Flexible

August 6, 2015
The Nicholas Institute for Environmental Policy Solutions at Duke University

The Nicholas Institute for Environmental Policy Solutions at Duke University

On Monday, President Obama announced the release of the final Clean Power Plan (CPP), which sets mandatory limits on the amount of carbon dioxide emissions the nation’s fleet of existing power plants may emit. The rule is projected to reduce emissions 32 percent below 2005 levels by 2030.

“We’re the first generation to feel the impact of climate change. We’re the last generation that can do something about it,” Obama said, noting that power plants are the single largest source of carbon pollution, a key contributor to climate change. “Until now, there have been no federal limits to the amount of carbon pollution plants dump in the air.”

Some Plan Particulars

The complicated and controversial 1561-page rule was developed by the Obama administration using existing authority under the Clean Air Act—specifically, section 111(d). The plan, according to a Washington Post op-ed, “is about as flexible as possible,” because it allows each state to come up with its own compliance program to meet the federal standards.

In broad strokes, the plan is designed to accelerate an already-underway shift from coal-fired electricity to cleaner natural gas and renewables, along with increased energy efficiency, by requiring existing power plants to meet specific carbon dioxide emissions reduction guidelines. The U.S. Environmental Protection Agency (EPA) calculated the targets based on a “best system of emissions reduction” comprised of three building blocks: making existing coal plants more efficient; shifting generation from coal to gas plants; and increasing generation from renewables.

Once the targets are set, however, states do not have to use the building blocks as a framework for their plans, and have been given a range of market-based, flexible mechanisms to reach their state targets.  In fact, emulating the flexibility afforded power plants under the market-based program devised in 1990 to reduce sulfur dioxide emissions, the CPP allows states to create “trading-ready” plans that will allow affected plants to sell emissions credits or to buy credits, if that’s a less expensive option than taking other actions. Parallel compliance approaches remove the need for formal interstate trading agreements, an approach described in one of Duke University’s Nicholas Institute for Environmental Policy Solutions’ recent policy briefs. Also facilitating trading are new state goals reflecting uniform national emissions rate standards for fossil steam (coal and oil) and natural gas power plants, respectively, reports ClimateWire (subscription).

The centerpiece of the Obama administration’s push to slash U.S. carbon emissions 17 percent below 2005 levels by 2020 and 26–28 percent below 2005 levels by 2025, the final CPP was timed to build momentum toward the start of international climate talks in Paris in November. Lord Nicholas Stern, a prominent economist in the U.K., said the rule’s release will “set a powerful example for the rest of the world,” and will reinforce the credibility of the U.S. commitment to greenhouse gas emissions reductions as a new international agreement on climate change is being finalized.

Significant Changes from the Proposal

Changes to the final plan were expected, given some 4 million comments on the proposed plan, and the plan did not disappoint. One big change, according to Acting Assistant Administrator for the Office of Air and Radiation Janet McCabe, is based on the assumption that renewable energy and regional approaches have even greater capacity for helping the power sector reduce emissions than reflected in the draft proposal (subscription). Consequently, the final plan will cut power plant carbon emissions 32 percent below 2005 levels by 2030, rather than the 30 percent target in the proposed rule.

The final rule also axed what the draft proposal referred to as Building Block 4, a criterion for achieving emissions reductions through programs that improve electricity consumers’ energy efficiency, as a means of calculating the state targets. Although these efficiency standards and under-construction nuclear plants were left out of the criteria for setting state goals under the plan, both are still available as compliance options.

The plan also includes a Clean Energy Incentive Program that rewards states for investing early (2020–2021) in renewable energy, specifically solar and wind power as well as demand side energy efficiency in low-income communities. Details of the incentive scheme are yet to be worked out, but the final rule goals do now expect renewable energy sources to account for 28 percent of the nation’s capacity by 2030—up from 22 percent in the proposal (subscription). The aim, said EPA Administrator Gina McCarthy is to incentivize renewable energy, which will lessen the reliance on natural gas as a replacement for coal power as the dominant compliance strategy.

Many other changes were anticipated in the Nicholas Institute’s most recent policy brief, including:

  • Additional time—an two extra years (to 2022)—for states to submit plans and begin cutting emissions;
  • Easing of the interim goals “glide path,” which states can now craft for themselves; and
  • New state mass emissions targets. These targets, based on states’ energy mixes and a uniform emissions rate for plants that use the same technology but no longer on demand-side energy efficiency, are less disparate than and also vastly different from those in the proposal. They also allow states to choose whether to use one target that includes the emissions from new natural gas units or another target that excludes these units (but still provides mechanisms to ensure that emissions cannot increase through new units).

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

Studies Make Predictions of How to Comply, What to Look for in Final Clean Power Plan

July 30, 2015
The Nicholas Institute for Environmental Policy Solutions at Duke University

The Nicholas Institute for Environmental Policy Solutions at Duke University

The U.S. Environmental Protection Agency (EPA) is slated to release the final version of its Clean Power Plan, regulating emissions from existing power plants, any day now. Many are already predicting changes, some that could be significant.

A survey by E&E publishing revealed stakeholders expect timing to be the element most likely to change in the final rule (subscription). The Washington Post, citing sources familiar with plans, reports the agency will give states an additional two years—until 2022—to begin implementing pollution cuts.

A new policy brief by Duke University’s Nicholas Institute for Environmental Policy Solutions highlights 11 elements we’ll be watching for. The top three, according to co-author and Climate and Energy Program director Jonas Monast: “I think that the top three issues are did the state targets change, and if so that means that the formula for calculating the state targets changed. Another point that I’ll be looking for is the timing … so when do the states have to submit the plans and when do utilities actually have to start taking action. And then the final, does EPA say more about the potential for using market-based mechanisms under the Clean Power Plan, and how?”

One more—guidance on multistate trading options. A number of organizations have explored options for multi-state trading of emissions credits without formal multistate agreements (subscription). Under a “common elements” or “trading-ready” approach, states could use similarly defined tradable emissions credits and common or linked tracking systems to ease the trade of emissions credits across state boundaries. Expanded emissions markets would increase gains from trade. The final rule may provide guidance on incorporating common elements into state compliance plans, and it may also indicate that the EPA will develop a tracking system to facilitate intrastate and interstate Clean Power Plan credit markets.

Another new study, out this week, suggests regional compliance may be the most cost-effective approach for states to comply with the rule. The Southwestern Power Pool study found under the EPA’s June 2014 draft plan, state-by-state compliance would cost 40 percent more than a regional approach.

“Our analysis affirmed that a state-by-state compliance approach would be more expensive to administer than a regional approach,” said Lanny Nickell, vice president of engineering for SPP, in a news release. “A state-by-state solution also would be more disruptive than a regional approach to the significant reliability and economic value that SPP provides to its members as a regional transmission organization.”

According to a newly released Synapse Energy Economics study, states that focus compliance efforts on expanding carbon-free energy production and energy efficiency programs will reap big savings. The largest savings, it says, will be seen by states that take these renewable energy steps early on.

Court Grants the EPA Partial CASPR Victory

The U.S. Appeals Court for the District of Columbia, on Tuesday, upheld an EPA regulation, originally challenged by states and industry, to restrict power plant emissions that cross state lines. The ruling did find the EPA erred in its 2014 budgets for sulfur dioxide and nitrogen oxide and called for the agency to rework them.

Although the 2011 rule—known as Cross State Air Pollution Rule (CASPR)—remains intact, Judge Brett Kavanaugh said the court expects the agency to “move promptly” and not “drag its feet” in coming up with new budgets. Kavanaugh wrote that EPA’s budgets “have required states to reduce pollutants beyond the point necessary” to achieve air quality improvements in downwind areas (subscription).

The EPA, in a statement released by spokeswoman Melissa Harrison, said “The agency remains committed to working with states and the power sector as we move forward to implement the rule. We are reviewing the decision and will determine any appropriate further course of action once our review is complete.”

CASPR has faced many challenges. The Supreme Court upheld the rule, which aims to reduce emissions of sulfur dioxide and nitrogen oxides that can lead to soot and smog in 28 states, in May 2014. The rule was invalidated by a federal appellate court in August 2012 after it was challenged by a group of upwind states and industry because it enforced pollution controls primarily on coal plants.

Climate Change Undermines Coral Reefs’ Protective Effect on Coasts

Climate change decreases coral reefs’ capacity to protect coasts against wave action and resulting hazards according to a new study accepted for publication in Geophysical Research Letters, a journal of the American Geophysical Union. That reduced capacity could make low-lying coral islands and atolls—home to some 30 million people—uninhabitable.

The study by researchers from Dutch institute for applied research Deltares and the U.S. Geological Survey finds that sea level rise and coral reef decay will lessen reefs’ dissipation of wave energy, leading to flooding, erosion, and salination of drinking water resources.

The study authors used Xbeach, an open-source wave model, to understand the effects of higher sea levels and smoother coral as it degrades. Their results suggest that wave runup and thus flooding potential is highest for those coasts fronted by narrow reefs with steep faces and deeper, smoother reef flats.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

Bonn Climate Talks Look to Shape More Complete Text Ahead of Paris

June 4, 2015
The Nicholas Institute for Environmental Policy Solutions at Duke University

The Nicholas Institute for Environmental Policy Solutions at Duke University

The next round of international climate negotiations began Monday in Bonn, Germany, and runs through June 11. The main task for the delegates from nearly 200 countries: pare down draft text for a final global climate deal to be negotiated at the United Nations Climate Change Conference in Paris later this year. The 89-page working draft contains differing options and viewpoints. Some countries, reports Deutsche Welle, want to set intermediate goals and others—including Russia, Canada, the United States, and the European Union—have pledged formal emissions cuts.

“No matter how you cut it, the hard work will be done in Paris,” a senior developing country delegate told Bloomberg BNA. “We will reduce the options in Bonn, but the final language will only come in Paris.

Multiple reports question whether the world is on track to meet the goal of keeping warming below 2 degrees Celsius. One, by the International Energy Agency (IEA), examines clean energy progress—noting shortcomings.

“Indeed, despite positive signs in many areas, for the first time since the IEA started monitoring clean energy progress, not one of the technology fields tracked is meeting its objectives,” the report said. “The future that we are heading towards will be far more difficult unless we can take action now to radically change the global energy system.”

Others say failure is not an option and note that new mechanisms for future rounds of pledges, perhaps in 2025 and 2030, can hit the mark.

“You don’t run a marathon with one step,” said Christiana Figueres, the United Nation’s top climate change official.

Report Emphasizes Importance of Existing Policies, Clean Power Plan to Meet U.S. Climate Commitment

In preparation for the United Nations Climate Change Conference in Paris later this year, the Obama administration pledged to reduce U.S. emissions 26–28 percent below 2005 levels by 2025. According to a new paper by the World Resources Institute (WRI), few policy changes will be required for the United States to meet or exceed that commitment. First among the paper’s 10 recommendations: strengthening the Clean Power Plan, which is projected to be finalized in August.

“While our analysis shows that the Clean Power Plan does not need to be strengthened in order to reduce economy-wide emissions by 26 percent below 2005 levels in 2025 (as long as ambitious action is taken across other emission sources),” write the authors, “doing so would enable the United States to more easily achieve the upper range of its 2025 target and achieve deeper reductions beyond the 2025–30 time frame.”

The Nicholas Institute for Environmental Policy Solutions contributed modeling underlying some of the report’s findings. It used a version of the Energy Information Administration’s well-known National Energy Modeling System (DUKE-NEMS), which is maintained by the Nicholas Institute, to model two pathways for longer-term abatement opportunities through new legislation.

“DUKE-NEMS complements WRI’s model by capturing supply-demand interactive effects,” said Nicholas Institute Senior Policy Associate Etan Gumerman. “We used it to explicitly model economic impacts. It helped us establish the level of emissions reductions that are economically achievable using targeted policies, while highlighting the greater emissions reductions that could come from potential climate legislation.”

Other measures recommended by the WRI report are expanding residential and commercial energy efficiency programs, increasing cuts in emissions of the refrigerant hydroflourocarbon, making industrial emissions standards and fuel economy standards more stringent, establishing emissions standards for new airplanes, increasing carbon sequestration in forests, and cutting methane emissions from coal mines, landfills, and agriculture.

Court Sides with EPA on Ozone Ruling

A federal court is siding with the U.S. Environmental Protection Agency (EPA) on enforcement of limits on smog-forming pollution, rejecting challenges from states, industry and environmental groups claiming that the EPA was too strict or too lenient in determining areas that satisfied federal ozone restrictions. The National Ambient Air Quality Standards for ground-level ozone set the allowable level at 75 parts per billion in 2008. In 2014, the EPA had proposed even stricter emissions limits on ozone of 65 to 70 parts per billion.

“Virtually every petitioner argues that, for one reason or another, the EPA acted arbitrarily and capriciously in making its final [National Ambient Air Quality Standards] designations,” the opinion states. “But because the EPA complied with the Constitution, reasonably interpreted the Act’s critical terms and wholly satisfied—indeed in most instances, surpassed—its obligation to engage in reasoned decision-making, we deny the consolidated petitions for review in their entirety.”

Ground level ozone—the main ingredient in smog—forms when chemicals in fossil fuel emissions react with sunlight and air.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

Organizations Develop Tools to Help States Comply with EPA’s Clean Power Plan

May 14, 2015
The Nicholas Institute for Environmental Policy Solutions at Duke University

The Nicholas Institute for Environmental Policy Solutions at Duke University

The same week Sen. Shelley Moore Capito (R-W. Va.) introduced a new bill pushing back on implementation of the U.S. Environmental Protection Agency’s (EPA) proposed Clean Power Plan, organizations released tools to help states and regulators navigate compliance with the resulting rule, set to be finalized this summer.

The rule uses an infrequently exercised provision of the Clean Air Act to set state-specific reduction targets for carbon dioxide and to allow states to devise individual or joint plans to meet those targets. One tool—the Multistate Coordination Resources for Clean Power Plan Compliance—developed by the National Association of Regulatory Utility Commissioners and the Eastern Interconnection States Planning Council looks to build on the flexibility the proposed rule gives states to meet their interim and final emissions reduction goals. The document is aimed at helping states overcome institutional barriers to coordination of rule compliance efforts (subscription). The guide includes a multistate planning checklist, a legislative language examples checklist and a sample memorandum of understanding for multistate coordination.

“A range of interactions is possible, from simple awareness of each others’ plans to the transfer of emissions reductions between states that have individual-state plans and targets (not a multi-state plan to meet a joint target) when states have ‘common elements’ in their compliance plan,” the guide notes.

The common elements concept was developed at Duke University’s Nicholas Institute for Environmental Policy Solutions and is an idea I spoke about last month at the Navigating American Carbon World conference in California. In a nutshell, power plant owners can transfer low-cost emissions reductions between states whose compliance plans share common elements—credits defined in the same way and mechanisms to protect against double counting. This approach builds on existing state and federal trading programs while maintaining the traditional roles of state energy and environmental regulators.

Still another tool—a calculator—arms state air quality agencies with the data to estimate carbon emissions savings from state adoption and enforcement of stringent building energy codes in state compliance plans under the proposed EPA rule.

“Because energy savings from stronger building energy codes put thousands in the wallets of home and commercial building owners, and improve building quality, comfort, and resale value, state officials should be adopting them simply to benefit their residents,” said William Fay, executive director of the Energy Efficient Codes Coalition. “But because buildings use 71 percent of America’s electricity, 54 percent of our natural gas, and 42 percent of all energy, improving their efficiency has profound potential benefits to national energy policy as well.”

Oil Drilling Conditionally Approved in Artic Waters

Shell is once again set to take up oil drilling in American Arctic waters after winning approval from the U.S. Bureau of Ocean Energy Management (BOEM), which said it had accepted the company’s plan to drill up to six wells in the Chukchi Sea after concluding that the operations “would not cause any significant impacts” to the environment, residents, or animals. As part of the conditional approval, Shell must first obtain permits from the federal government and the state of Alaska.

Seasonal conditions in the Arctic mean that drilling can typically occur only over a four-month period, but a reduction of the ice due to climate change could ignite Arctic drilling aspirations. For many in industry, the news was welcome.

“The Chukchi Sea is widely seen as one of the last great unexplored conventional oil basins,” said Alison Wolters, an analyst with Wood MacKenzie’s Alaska and Gulf of Mexico programs. “A positive discovery this season would encourage the other operators to reconsider the region.”

Announcement of the news spurred environmental groups to express concern about Shell’s mishap-filled 2012 Arctic drilling season and about new operations in the harsh region, which has little capacity for emergency response but in which federal scientists believe some 15 million barrels of oil may be held.

On the heels of the BOEM’s greenlighting of renewed oil drilling in the Arctic, Christiana Figueres, who leads the U.N. Framework Convention on Climate Change, noted that achieving net-zero emissions by 2100 means that many oil and gas reserves must remain untapped (subscription).

“We have absolutely no opinion about what governments do with companies that operate within their geographic boundaries,” she said. “But there is an increasing amount of analysis that points to the fact that we will have to keep the great majority of fossil fuels underground.”

Report: Oil Price Drop Could Hurt Global Economy

A new report from the Global Commission on the Economy and Climate finds that the recent drop in oil and natural gas prices—although providing temporary relief for consumers—may compel governments to authorize projects that use expensive carbon-intensive fuels. In fact, the Oil Prices and the New Climate Economy report suggests that governments should take advantage of low prices to reduce dependency and reform fossil fuel subsidies (subscription).

“For years, we’ve had a market failure by not taxing carbon and air pollution nearly enough,” said Lord Stern, co-author and a prominent climate economist. “That is subsidizing hydrocarbons in my book. When oil prices fall, it is a wise time to change it and that will also help protect us against energy price volatility in the future.”

The report notes that renewable energy sources—including solar and wind—have little to no operating cost after installation and suggests their use can lock in the cost of energy for two or more decades.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

Court Hears Arguments Surrounding EPA Power Plant Rule

April 16, 2015
The Nicholas Institute for Environmental Policy Solutions at Duke University

The Nicholas Institute for Environmental Policy Solutions at Duke University

The U.S. Court of Appeals for the District of Columbia Circuit heard arguments Thursday in a set of cases (Murray Energy v. EPA and West Virginia v. EPA) challenging the U.S Environmental Protection Agency’s (EPA) authority to limit greenhouse gases from existing power plants under section 111(d) of the Clean Air Act. There was skepticism from at least two of the three judge panel about whether they could hear a challenge before the rule is finalized. Judges Griffith and Kavanaugh both questioned whether the rulemaking was “extraordinary” and requiring of immediate court review.

Whether the court decides to review the proposed rule or not, the argument also previewed future challenges claiming the EPA misused sections of the Clean Air Act to regulate pollution. The plaintiffs—a coalition of coal-producing states and a coal company—argue that the EPA rules violate the Clean Air Act’s language limiting regulation of the facilities for pollutants to just one section of the law. A drafting error in 1990 created conflicting language between the House and Senate versions that was never resolved, with the House limiting regulation under section 111(d) to those facilities that were not regulated otherwise, and the Senate limiting regulation only to those pollutants that were not otherwise regulated. The EPA claims that it has discretion to resolve such a conflict of language in the way it has proposed.

Obama Proposes New Offshore Drilling Rules

As the five-year anniversary of the Deepwater Horizon explosion and oil spill in the Gulf of Mexico nears, the Obama administration is proposing dozens of rules aimed at strengthening oversight of offshore drilling equipment to ensure that wells can be sealed in emergency situations.

The draft rules would impose tougher standards on equipment designed to maintain well control (such as the blowout preventer that malfunctioned in the BP spill), require real-time monitoring of drilling in deep-water and high-pressure conditions, and establish annual third-part reviews of repair records.

“Both industry and government have taken important strides to better protect human lives and the environment from oil spills, and these proposed measures are designed to further build on critical lessons learned from the Deepwater Horizon tragedy and to ensure that offshore operations are safe,” said U.S. Department of the Interior Secretary Sally Jewell (subscription).

Carbon Emissions from Permafrost: Good and Bad News

A new study in the journal Nature warns that a warming climate can induce environmental changes that hasten the microbial breakdown of organic carbon stored in permafrost (frozen soils) within the Artic and sub-Artic regions, releasing carbon dioxide and methane—a feedback that can accelerate climate change. Although a sudden or catastrophic release of these greenhouse gases from the top three meters of global permafrost soil and Arctic river deltas is unlikely, the projected release of 5–15 percent of an estimated 1,330–1,580 gigatons—equaling an extra 0.13 to 0.27 degrees Celsius of warming—by 2100 is troubling given the tight carbon budget to hold global warming to 2 degrees Celsius above pre-industrial temperatures.

The study’s authors said that target likely will be overshot if the Arctic’s soil carbon stores are not accurately incorporated into climate models used by policy makers to decide how to mitigate missions and limit global warming.

“If society’s goal is to try to keep the rise in global temperatures under 2 degrees C and we haven’t taken permafrost carbon release into account in terms of mitigation efforts, then we might underestimate that amount of mitigation effort required to reach that goal,” said study co-author David McGuire.

Although the Intergovernmental Panel on Climate Change was aware of the potential for permafrost emissions, it didn’t factor them into its most recent major report because estimates from earlier studies were considered uncertain and unreliable.

According to McGuire, data from his team’s syntheses do not support a hypothesized permafrost carbon bomb. “What our syntheses do show,” McGuire said, “is that permafrost carbon is likely to be released in a gradual and prolonged manner, and that the rate of release through 2100 is likely to be of the same order as the current rate of tropical deforestation in terms of its effects on the carbon cycle.”

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

McCarthy: States Must Comply with Clean Power Plan

March 19, 2015
The Nicholas Institute for Environmental Policy Solutions at Duke University

The Nicholas Institute for Environmental Policy Solutions at Duke University

On Tuesday, a lawyer hired by the world’s largest coal mining company told the House Energy and Commerce Subcommittee on Energy and Power that proposed requirements to reduce carbon dioxide emissions from power plants are reckless, and Senate majority leader Mitch McConnell of Kentucky, in an op-ed, said states should ignore them, but U.S. Environmental Protection Agency (EPA) administrator Gina McCarthy warned that the regulations will be enforced whether or not states chose to cooperate.

“The EPA is going to regulate. Mid-summer is when the Clean Power Plan is going to be finalized,” McCarthy said, noting that the EPA is developing a federal implementation plan that will apply to states that fail to submit their own compliance plans. “If folks think any of those pieces aren’t going to happen and [the Clean Power Plan] isn’t going to be implemented, I think they need to look at the history of the Clean Air Act more carefully. This isn’t how we do business.”

A new policy brief by Duke’s Nicholas Institute for Environmental Policy Solutions offers a compliance pathway for the EPA’s proposed Clean Power Plan that allows states to realize the advantages of multistate and market-based solutions without mandating either strategy. Under the common elements approach, states develop individual-state plans to achieve their unique emissions targets and give power plant owners the option to participate in cross-state emissions markets.

“States wouldn’t necessarily have to mandate market-based approaches or even endorse the approaches,” said Jonas Monast, lead author and director of the Climate and Energy Program at the Nicholas Institute. “What it would require is the states using a common definition of what a compliance instrument is and ensuring that somehow the credits are verified and tracked.”

The common elements approach would allow cross-state credit transfers without states’ negotiation of a formal regional trading scheme, leave compliance choices to power companies, build on existing state and federal trading programs and maintain traditional roles of state energy and environmental regulators.

Carbon Footprint of Crudes Varies Widely

A first-of-its-kind oil-climate index, produced by the Carnegie Endowment for International Peace’s Climate and Energy Program in collaboration with Stanford University and the University of Calgary, captures the huge spread between the most and least intensive greenhouse gas (GHG) oils. By calculating the carbon costs of various crudes and related petroleum products, the authors suggest that companies and policymakers can better prioritize their development.

The index reflects emissions from the entire oil supply chain—oil extraction, crude transport, refining, marketing, and product combustion and end use—and reveals an 80 percent spread between the lowest GHG-emitting oil and the highest in its sample of 30 crudes, representing some 5 percent of global oil production. That spread will likely grow when more types of crude oil, particularly oil from unconventional sources, are added to the index.

The lead emitter? China Bozhong crude, followed by several Canadian syncrudes derived from oil sands-extracted bitumen.

A blog post for the Union of Concerned Scientists suggested that the wide emissions spread should give rise to “more responsible practices like capturing rather than flaring gas” and that in some cases “the dirtiest extra-heavy resources are best left in the ground.”

The index, which highlights that attention to the entire lifecycle of a barrel of crude is critical to designing policies that reduce its climate impacts, was released days before the International Energy Agency reported that for the first time in 40 years of record keeping, carbon dioxide emissions from energy use remained steady in 2014. The halt, the report states, is particularly notable because it is not tied to an economic downturn.

More Renewables, Tougher Standards for Public Lands

Secretary of the Interior Sally Jewell previewed plans to make energy development safer on public and tribal lands and waters in a speech outlining priorities for the Obama administration’s final years.

“…our task by the end of this Administration is to put in place common-sense reforms that promote good government and help define the rules of the road for America’s energy future on our public lands,” Jewell said. “Those reforms should help businesses produce energy more safely and with more certainty. They should encourage technological innovation. They should ensure American taxpayers are getting maximum benefit from their resources. And they should apply our values and our science to better protect and sustain our planet for future generations.”

Among the measures to be unveiled in coming months: tightened spill prevention standards for offshore drilling, increased construction of solar and wind installations and a raise in royalties from coal mining.

Jewell also hinted at plans “in coming days” to propose rules governing hydraulic fracturing on public lands, which are believed to hold about 25 percent of the country’s shale reserves.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

First Rules for Arctic Drilling Released

February 26, 2015
The Nicholas Institute for Environmental Policy Solutions at Duke University

The Nicholas Institute for Environmental Policy Solutions at Duke University

The U.S. Department of the Interior unveiled the first draft rules for offshore oil and gas exploration in the Arctic. The rules would require energy companies to clear a number of safety hurdles before being approved for drilling.

“The Arctic has substantial oil and gas potential, and the U.S. has a longstanding interest in the orderly development of these resources, which includes establishing high standards for the protection of this critical ecosystem, the surrounding communities, and the subsistence needs and cultural traditions of Alaska Natives,” said Secretary of the Interior Sally Jewell. She noted that the proposed regulations “are designed to ensure that offshore exploratory activities will continue to be subject to the highest safety standards.”

The regulations, which were crafted with a nod to previous experiences in the Arctic’s first drilling season when a Royal Dutch Shell oil rig ran aground in 2012, are open for public comment now, but they are not expected to be finalized before this summer’s drilling season. If approved, they would—among other things—require energy companies to submit safety plans and have a separate backup rig nearby to quickly drill a relief well to handle any blowout.

Oceans Warming and Seas Rising Faster Than Predicted

Obscured by news that 2014 had the hottest global air temperatures on record was new data from the National Oceanic and Atmospheric Administration (NOAA) about ocean warming. As climate expert John Abraham wrote in the Guardian, “The oceans are warming so fast, they keep breaking scientists’ charts.” Literally. The 2014 heat spike was so pronounced that scientists had to re-scale the chart NOAA uses to track ocean temperatures.

Oceans absorb more than 90 percent of global warming heat, and in recent years they have seen an acceleration in warming. Ocean acidification is a direct result of this absorption of carbon dioxide. A new study in Nature Climate Change, co-authored by Duke University researchers, offers the first nationwide look at the vulnerability of our country’s $1 billion shellfish industry to the problem of more acidic oceans.

“We find that nearly two-thirds of the country will be hit hard, but by different sources of ocean acidification,” said Linwood Pendleton, co-author and senior scholar at Duke’s Nicholas Institute for Environmental Policy Solutions. “Some areas are most impacted by CO2 driven ocean acidification, some by upwellings, and some by increased acidification caused by freshwater run-off. Previously, our focus was on the Pacific Northwest, but this study shows that the Gulf of Mexico, the Chesapeake Bay, and New England also will be impacted.”

According to a separate study in Science and another co-authored by researchers at the University of California–Irvine, NASA’s Jet Propulsion Laboratories, and three other institutions, warmer ocean waters are also the culprit in accelerated thawing of a West Antarctica ice sheet.

Rising ocean temperatures are one of the factors contributing to a rate of sea-level rise that according to a new study in Nature is much faster than scientists had predicted. “The acceleration into the last two decades is far worse than previously thought,” said study coauthor Carling Hay. “This new acceleration is about 25 percent higher than previous estimates.”

How do we know? The Nature study relied on a new and improved way of measuring sea-level rise.

“What we have done, which is a bit different from past studies, is use physical models and statistical models to try to look for underlying patterns in the messy tide gauge data observations,” said Hay. “Each of the different contributions actually produces a unique pattern, or fingerprint, of sea-level change. And what we try to do is model these underlying patterns and then use our statistical approach to look for the patterns in the tide gauge observations. That allows us to infer global information from the very limited records.”

If the new method holds up to further scrutiny, scientists could be more confident about their understanding of the precise causes of sea-level rise—and in their ability to project future increases in it.

Obama Vetoes Keystone XL

President Barack Obama left the long-debated Keystone XL Pipeline project in limbo this week after vetoing a bill to approve construction of the oil pipeline.

Of the bill for the pipeline, slated to transport oil from Canada to the U.S. Gulf Coast, Obama wrote that “the United States Congress attempts to circumvent longstanding and proven processes for determining whether or not building and operating a cross-border pipeline serves the national interest … And because this act of Congress conflicts with established executive branch procedures and cuts short thorough consideration of issues that could bear on our national interest—including our security, safety, and environment—it has earned my veto.”

We haven’t heard the last of this controversy. Obama retains the right to make a final decision on the pipeline on his own timeline, the Washington Post reports, after the executive process (review at the State Department) runs its course. The Senate will vote no later than March 3 to override the veto, according Senate Majority Leader Mitch McConnell.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

The Cost of Fixing Climate Change

September 18, 2014
The Nicholas Institute for Environmental Policy Solutions at Duke University

The Nicholas Institute for Environmental Policy Solutions at Duke University

Reducing greenhouse gas emissions could boost the economy rather than slow it, according to a new study by the Global Commission on the Economy and Climate. Better Growth, Better Climate: The New Climate Economy Report finds that roughly $90 trillion will be spent in the next 15 years on new infrastructure around the world. Adopting rules that redirect that investment toward low-emissions options—more efficient use of resources and the building of connected and compact urban cities driven by public transportation—could make economic sense.

“A central insight of this report is that many of the policy and institutional reforms needed to revitalise growth and improve well-being over the next 15 years can also help reduce climate risk,” the report authors said. “In most economies, there are a range of market, government and policy failures that can be corrected, as well as new technologies, business models and other options that countries at various stages of development can use to improve economic performance and climate outcomes together.”

Taking action on climate change, the report authors said, is affordable.

“Of the $6 trillion we will spend a year on infrastructure, only a small amount—around $270 billion per year—is needed to accelerate the shift to a low-carbon economy, through clean energy, public transport systems and smarter land use,” said Felipe Calderon, chairman of the Global Commission on the Economy and Climate. “And this additional investment could be entirely offset by operating savings, particularly through reduced fuel expenditures”

Studies Assess Impacts of Hydraulic Fracturing

A new study in the journal Proceedings of the National Academy of Sciences links water contamination from shale gas extraction in parts of Pennsylvania and Texas to well integrity rather than the hydraulic fracturing process. The research, which looked at 133 water wells with high levels of methane, found that the contamination was either naturally occurring or linked to faulty well construction by drillers.

“These results appear to rule out the possibility that methane has migrated up into drinking water aquifers because of horizontal drilling or hydraulic fracturing, as some people feared,” said Avner Vengosh, study co-author and professor of geochemistry and water quality at Duke University. Researchers pointed, instead, to the cement used to seal the outside of vertical wells and the steel tubing used to line them as culprits.

“In all cases, it [the study] basically showed well integrity was the problem,” said Thomas H. Darrah, co-author and Ohio State University researcher. “The good news is, improvements in well integrity can probably eliminate most of the environmental problems with gas leaks.”

Another study on hydraulic fracturing in the Bulletin of Seismological Society of Americafound a connection between deep injections of wastewater from a coal-bed methane field and an increase in earthquakes in Colorado and New Mexico since 2001. The report, which focuses on the Raton Basin, suggested that the area had been “seismically quiet”—experiencing only one earthquake of greater than 3.8 magnitude—until shortly after major fluid injections began in 1999. Since 2001, the area has recorded 16 such events.

EPA Extends Comment Period for Power Plants

On Tuesday, the U.S. Environmental Protection Agency (EPA) extended the public comment period for its proposed rule for regulating carbon dioxide emissions from existing power plants by 45 days—to Dec. 1.

Janet McCabe, the EPA’s acting assistant administrator for the Office of Air and Radiation, said the extension is due to stakeholders’ great interest.

“While we’ve heard quite a bit so far, we know that there are many individuals and groups continuing to work to formulate their input,” she said. “We want the best rule possible, and we want to give people every opportunity to give their ideas and contributions.”

The delay, McCabe told reporters, would not affect the timeline for finalizing the rule by June 2015.

The same week, a government watchdog agency—the Government Accountability Office (GAO)—released a report suggesting coal plant retirements may be higher than previously thought. It predicted 13 percent of coal-fired generation would come offline by 2025—compared with its 2012 estimate of 2 percent to 12 percent.

The report suggested that existing regulations such as the EPA’s Mercury and Air Toxics Standard and recently proposed regulations to reduce carbon dioxide emissions from existing generating units were contributors to the retirements. Low natural gas prices, increasing coal prices and low expected growth in demand for electricity were also cited as contributors.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.