Thursday, January 31, 2008

Offsets Versus Allowances:

What do these provisions mean for the Agricultural Sector?


OFFSETS

  • Allows free-market participation for agriculture

  • Income opportunities for agriculture are only limited by the amount of offsets allowed by the policy: a cap on offsets limits income potential for agriculture

  • Agriculture receives market value for each ton of carbon sequestered or reduced: buyers will pay whatever price the market will bear


ALLOWANCES

  • Not a free market opportunity for agriculture

  • This is a government-administered (USDA) program

  • The value and payment for tons sequestered or reduced by agriculture will not be determined by market value, but will be determined by the government (USDA)

  • Consider this language from NRDC and WRI1, regarding what they consider the function of the allowances provision to be:

If biological sequestration and emissions reductions from programs supported by the USDA are less expensive than the market price of allowances, the USDA could be expected to require more than one ton of emissions benefits for every allowance allocated.”


In other words, if it costs a producer $25 to sequester a ton of carbon, but the market price for carbon is $100, the producer will have to sequester 4 tons of C to receive an allowance from USDA that is equivalent to one ton.

  • This would prevent agricultural producers from getting market price for their emissions reductions.

  • This treatment is not being considered for any other sector.


A comparison of payments received by agricultural producers under the offset system, and under the allowances system, as proposed by the NRDC/WRI analysis:

Assumptions:

Costs to agricultural producer to sequester 1 ton C = $25.00

Market price of carbon allowances per ton of C = $100.00

Offsets Provision: Allowance Provision

Ag payment received for 1 ton C = $1002 Ag payment received for 1 ton C = $25.00


1 Greenhouse Gas Emission Reductions under the Lieberman-Warner Bill (S.2191): Full Committee Chairman’s Mark with Boxer 1st Degree Amendment, by Daniel Lashof, Climate Center Science Director, NRDC, John Larson, Associate (WRI), and Robert Heilmayr, Research Assistant, Climate and Energy Program, World Resources Institute. December 4, 2007.

2 Note that this does not include discounts that may be applied for measurement uncertainty or leakage, which are being considered as part of both offsets and allowance provisions in cap-and-trade policies.

Friday, January 18, 2008

Eco-Pragmatism Emerging!

Hello & welcome to a blog designed to promote pragmatic environmental solutions rather than the rhetoric of "the unrealistic purists" or the denial of "greenwashing spinmasters"

For too long, environmental and energy policy has made the perfect the enemy of the good. But an amazing movement is starting to grow -- from some very interesting and unusual places: people are getting tired of the "us vs them" divide on many issues. In the case of environmental issues, the cost has been a devastating partisan divide that has not helped to improve the quality of our air or water -- or brought unity in dealing with the major environmental challenge of our time: climate change.

To solve these problems, we need to recognize that big changes happen step by step -- NOT all at once. And, we need to work WITH people not take the cheap shots of pitting them against each other. Working with people means listening -- NOT PREACHING -- and it means compromise rather than ideology.

I started down this path of eco-pragmatism over 7 years ago (without knowing that is what it was called) when I worked for a VERY conservative U.S. Senator who wanted to engage on environmental issues. Layered onto that experience, I worked for a major national non-profit Environmental Group -- so I've seen and understood both cultures very well. I've been trying to build policy bridges much of my life -- and have been amazed by the experience both in terms of how much can be accomplished . . . and by how rarely this truly hard, long work of alliance building is really done.

I was reading the Economist awhile ago when this article just grabbed me (see below). This is where I first heard the term Eco-Pragmatist -- and it instantly resonated with me.

I started this blog because I believe that most people want to work out problems rather than giving into feel good attacks when given the chance -- and that there is so much at stake for the country I love. Just think, if we really solve the climate change problem, that means we will also solve our dependency on countries like Saudi Arabia for oil. Usually the people who care about one issue could care less about the other -- but I think there is a message in how tied together these major problems are. America will only meet its full potential when her people put aside the lesser things that divide us and build on the strengths we can each bring to the table.

Call me an idealist I guess -- but please, call me pragmatic one!

Please write in with your thoughts!!
Sara
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The Economist
Jolly green heretic
Sep 6th 2007 From The Economist print edition

Stewart Brand, a pioneer of both environmentalism and online communities, has not lost his willingness to rock the boat

IN SOME respects Stewart Brand's green credentials are impeccable. His mentor was Paul Ehrlich, an environmental thinker at Stanford university and author of “The Population Bomb”, published in 1968. That book, and the related Club of Rome movement of the 1970s, famously predicted that overpopulation would soon result in the world running out of food, oil and other resources. Though it proved spectacularly wrong, its warning served as a clarion call for the modern environmental movement.

Mr Brand made his name with a publication of his own, which also appeared in 1968, called “The Whole Earth Catalogue”. It was a path-breaking manual crammed with examples of small-scale technologies to enable individuals to reduce their environmental impact, and is best known for its cover, which featured a picture of the Earth from space (which Mr Brand helped to persuade America's space agency, NASA, to release). The book became a bestseller in anti-corporate and environmental circles. In 1985 Mr Brand co-founded the WELL, a pioneering online community that was a precursor of today's social-networking websites such as MySpace and Facebook.
Mr Brand still has a following among the Birkenstock set, and even lives on a tugboat near San Francisco. But meet him in person and it becomes clear he is not exactly your typical crunchy-granola green. Sitting down to lunch at a posh beach resort on Coronado Island, off San Diego, he does not order a vegan special but a hearty Angus burger with bacon, cheese and French fries, and a side-order of lobster bisque. “I'm genetically a contrarian,” he says with a broad smile.

Three unpopular ideas
That is pretty evident from his recent proclamations. Rather than basking in past glories or sailing off to a quiet retirement, the 68-year-old counter-cultural icon remains determined to rock the boat. But this time his target is the environmental movement itself. He has come up with a series of what he calls “environmental heresies”, which he hopes will influence a new generation of pragmatic, problem-solving greens. Three things that most greens vehemently oppose—genetic engineering, urbanisation and nuclear power—should, he believes, be embraced on environmental grounds.

Start with genetic engineering. Many greens object to the idea, fearing a deluge of “Frankenfoods” and the contamination of pristine wild species. But Mr Brand points to the work of Norman Borlaug, the Nobel prize-winner who proved the Club of Rome (and Mr Brand) wrong with his “green revolution” in agricultural productivity. Mr Brand now sees great promise in using genetic science to feed the world, and perhaps prevent future wars, by making crops that are more disease-resistant, drought-tolerant and produce higher yields.
Similarly, he argues that urbanisation can be good for the environment. Mankind has now become a primarily urban species for the first time in its history, and every serious forecast predicts a surge in the size and number of megacities. Most environmentalists are dismayed at this trend, and worry about the implications of urbanisation for air pollution, resource consumption and so on. But Mr Brand bluntly rebuts them, insisting that megacities “will increase the Earth's carrying capacity for humans”.

That may seem an odd argument from a man who wrote a guide to natural living and going “off grid”, but it reflects another aspect of the maturation of his views. Cities are good for the planet, he argues, because they are engines of wealth creation, and greater prosperity makes promoting greenery easier. When poor people move from bleak subsistence farming to the economic opportunities found in urban slums, he insists, they no longer need to chop down endangered trees or eat bush meat. “Nature grows back,” says Mr Brand. He also believes cities unleash innovation—pointing to the use of mobile phones in slums to send money—and reckons the next big trend will come “not from Japanese schoolgirls, but slum-dwellers in Africa”.

Mr Brand's critics accuse him of romanticising the potential of megacities. But his support for the revival of nuclear power is even more controversial. For years, he held the orthodox environmental view that nukes were evil. He now confesses that this was merely “knee-jerk opposition”, and not a carefully considered opinion. His growing concern about global warming, which he calls “the single most important environmental threat facing mankind”, explains his U-turn in favour of this low-carbon but hugely controversial source of electricity.

The turning point came, he says, when he visited Yucca Mountain, a remote site in the Nevada desert where American officials plan to bury the country's nuclear waste. He was visiting the site as part of his Long Now project, which aims to build a “clock” that will last 10,000 years or more in the hope of encouraging society to think about very long-term issues. While studying the deep hole in the ground at Yucca for tips on building his clock—the site, like the clock, is being designed to survive unscathed for thousands of years—he had an epiphany.

Although greens and other anti-nuclear activists oppose the Yucca Mountain project, Mr Brand says he realised that “we are asking the wrong question” about nuclear power. Rather than asking how spent nuclear fuel can be kept safe for 10,000 to 100,000 years, he says, we should worry about keeping it safe for only 100 years. Because nuclear waste still contains an enormous amount of energy, future generations may be able to harness it as an energy source through tomorrow's better technologies.

His embrace of nuclear power was another surprising about-face, and plenty of energy experts, including some of his close friends, disagree with him. One of them is Amory Lovins, the head of the Rocky Mountain Institute, a natural-resources consultancy. Mr Brand recalls attending Mr Lovins's wedding many years ago in an American Indian sweat tent, where Mr Lovins and his (now ex) wife Hunter exchanged hunting knives in a traditional ceremony. Mr Lovins argues that the economics of big nuclear power plants make no sense, and that the future belongs to energy efficiency and small-scale, distributed “micropower” plants based on renewable energy sources.

“Environmental change changes everything, including environmentalism itself.”
That friendly debate points to some awkward aspects of Mr Brand's self-styled environmental heresy. For one thing, the decentralised approach to power generation advocated by Mr Lovins seems more in tune with the do-it-yourself ethos of “The Whole Earth Catalogue” than the big nuclear power plants now championed by Mr Brand. And Mr Brand's argument for taking a more short-term view of nuclear safety seems to fly directly in the face of his Long Now project, which is intended to promote a more long-term perspective.

The apparent contradiction is made more glaring by the fact that Mr Brand has made a tidy packet from long-term planning through his Global Business Network (GBN), a respected scenario-planning and futurology outfit. Some greens grouse that GBN's work with big oil companies and the American military is unethical, but Mr Brand has little patience for such narrow-mindedness. “Saying all companies are evil is like saying all greens are romantic twits,” he says. “You need to discriminate!” To bolster his point, he points to what he calls the quiet but influential role that Royal Dutch/Shell played in South Africa's peaceful end to apartheid. He also defends his military clients with vigour, noting that they are often “more serious” and “longer-term thinkers” than business clients.

So how does he respond to the apparent conflict between the long-termism of the Long Now project and the much shorter-term view of nuclear waste he uses to justify new nuclear power? He neatly sidesteps the contradiction. “Coal and carbon-loading the atmosphere are much bigger problems for the future than nuclear waste, which is a relatively minor risk,” he says.

Shades of green
This willingness to get his hands dirty and balance one risk against another, rather than clinging to ideologically pure positions when confronted with difficult choices, sets Mr Brand apart from the many ideologues in the environmental movement. Indeed, he proudly calls himself an “eco-pragmatist”. He argues that two ideological camps have dominated the green movement for too long: “the scientists and the romantics”. The former group has been stuck in the ivory tower, while the latter has held on to noble but impractical views that, he reckons, have often been contrary to rational scientific thinking. The grip that these two rival camps have had on environmentalism, he says, explains its malaise.

But growing public awareness of climate change and other green concerns promises to end this. “Environmental change changes everything,” he insists, “and among the biggest change of all will be in environmentalism itself.” As environmental issues have moved up the technological agenda, says Mr Brand, there has been a large influx of engineers into the environmental movement. These “techies” had previously been deeply sceptical of greenery, but he now thinks they may save the cause even as they save the planet. Unlike the romantics and the airy scientists, he says, “engineers focus on solving problems.”

He points approvingly to Elon Musk, a South African technology entrepreneur, and his green engineers at Tesla Motors, an electric-car firm. Mr Brand also tips his hat toward Mr Lovins, whom he praises as an early example of a problem-solving “engineer” (he is actually a physicist by training) who embraced the green cause. But this new generation of green engineers will only be able to transform the environmental movement, Mr Brand reckons, if the old guard allows it to. “Let's see if there is an allergic reaction to this infusion or real progress,” he quips.
Mr Brand's own pragmatism can be seen in his willingness to own up to his mistakes and learn from them. When his alarmism over the Y2K computer bug turned out to be wrong, for example, it made him realise that his own personal computer was a poor proxy for the world at large, which is “modular, shockproof and robust”. And the key mistake made by the Club of Rome's forecasts (which he calls “self-defeating prophesies”), he now acknowledges, was to see the world as static, and to place too little faith in the possibilities of technological progress.
His critics might argue that Mr Brand now places too much faith in clever engineers and fancy technology to solve the world's environmental problems. But he can respond that his pragmatic approach goes back a long way, and has deep roots. As he put it in the introduction to “The Whole Earth Catalogue”, written four decades ago: “We are as gods and might as well get good at it.”
 
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