Tuesday, March 25, 2008

Brits Questioning Biofuels, Favoring Oil??

Stories like the one below prove just how detrimental the "environmentalist" movement can be to the environment. Biofuels may have their problems, but they are far superior to oil for both the environment and for the geo-political security of the world. If there are problems, why not put the focus on making biofuels more sustainable, more compatible with food needs rather than just accepting oil as the new "low carbon fuel"??


Financial Times

Call to delay biofuels obligation

By Jean Eaglesham

Published: March 25 2008 01:04 | Last updated: March 25 2008 01:04

Ministers came under pressure on Monday to delay a move to force motorists to use biofuels, after the government’s top environment scientist warned that the supposedly green initiative could prove counter-productive.

Robert Watson, chief scientist at the Department for the Environment, on Monday called on ministers to postpone the introduction of the obligation, proposed for April 1, until a government-commissioned review of biofuels’ environmental sustainability had been completed.

The renewable transport fuels obligation will require at least 2.5 per cent of fuel at the pumps to consist of biofuels. Such biofuels – principally ethanol and diesel made from plants – have been promoted by policymakers in the US and Europe as a green alternative to fossil fuels.

Some scientists argue that the carbon benefits of burning biofuels may be outweighed by the environmental factors involved in their production, as well as the impact on food prices.

“It would obviously be totally insane if we had a policy to try and reduce greenhouse gas emissions through the use of biofuels that’s actually leading to an increase in the greenhouse gases from biofuels,” Prof Watson told the BBC.

His call for a moratorium was reinforced on Monday by a coalition of leading environmental and development groups, which wrote a joint letter to Ruth Kelly, transport secretary, warning that the obligation risked doing more harm than good.

Greenpeace argued that it would be “incredibly reckless” to press ahead with the policy without knowing its full impact on climate change. Friends of the Earth warned of the “potentially catastrophic impacts on people and the environment” of western countries setting volume targets for biofuel production.

The Liberal Democrats also backed calls for more analysis of the impact of biofuels. Norman Baker, Lib Dem transport spokesman, said Prof Watson was “right to raise the warning flag”.

The Department for Transport defended the new requirement while stressing that the government was reviewing the wider impacts of production.

“Biofuels have the potential to help reduce the impact of transport on the environment but we have always been clear about the need to ensure that they are sustainable,” an official said.

“The [obligation] has at its heart a detailed sustainability reporting mechanism – going further than any other country – which will create a strong incentive for transport fuel suppliers to source sustainable biofuels.”

China-EU Alliance Could Generate Low-Carbon Energy

For all those who use the China excuse as a reason why the U.S. should not engage in launching a climate market, take a look at the story below. I continue to believe China will move into carbon markets -- for ECONOMIC reasons, not environmental ones -- and that as it stands right now, the Europeans are the ones who will benefit from that market connection with China as they are the only ones with a real carbon market themselves.

Keep in mind, China already has tougher fuel efficiency requirements than the U.S., China is already the #3 ethanol producer in the world and China's dictatorial set-up means that when they decide to make changes, those changes take place on a massive scale and in a time frame that is simply impossible for democratic countries. Don't get me wrong - I'm not advocating their form of tyrannical government -- just pointing out the facts as they are now -- and it now stands, the Chinese government decides FOR its people when to turn on their heat and when the people can have air conditioning -- so comparing China's actions on climate to the U.S. is entirely and apples to oranges comparison.

The only question is whether the U.S. will launch its own real, mandatory carbon market in time to then be able to sell the new technology spurred by that market to the developing countries who are growing and hungry for clean tech to keep their economic growth path alive? There is an argument to be made that once the U.S. launches its market, much of the capital for renewable energy that is currently located in Europe, will migrate to the States given the more business/capital-friendly atmosphere here and the weaker currency (compared to the Euro).

SciDev Net


China/EU alliance 'could be key to low-carbon energy'

Jia Hepeng and Chen Weixiao

12 March 2008 | EN | 中文

Using conventional technologies, China and the EU will be locked in a high-carbon development model


[BEIJING] China and the European Union (EU) can significantly advance low-carbon technologies if they cooperate closely on technological development and market access, according to a new report.

'Interdependencies on Energy and Climate Security for China and Europe', outlines common challenges faced by the China and the EU in dealing with the impact of climate change on energy security — despite differences in their economic development.

The report was presented in Beijing last month (28 February). Contributors include UK think tank Chatham House and the Chinese Academy of Social Sciences (CASS).

In order to meet its fast-growing energy demands, China will need to add power generation capacity of 1260 gigawatts by 2030. And despite stable economic development, the countries of the EU will need to generate 862 gigawatts of additional energy by 2030 to replace outdated generation facilities.

If conventional technologies are used, both China and the EU will be locked in a high-carbon development model, the report warns.

But if they work together, the EU and China — which together account for 30 per cent of the world's energy consumption — could create unprecedented opportunities for global transition to low-carbon energy generation, says the report.

China's huge energy demands, low-cost manufacturing, and cheap local technological talent offer a shortcut for the production of clean energy technologies such as wind, solar and clean coal.

China has already produced 80 per cent of the world's energy-saving lamps — many of which are based on technology created in the EU.

The report recommends that EU research bodies establish research and development centres in China and increase the involvement of Chinese expertise in the development of clean energy technology.

It also suggests that the EU builds 'low-carbon economic zones' in China and establishes a joint technology platform to improve energy efficiency in the building sector.

Hu Angang, a leading researcher at Tsinghua University, welcomes the report, saying its recommendation to avoid "high-carbon development lock-in" both for China and EU is especially refreshing.

Pan Jiahua, a key advisor to the Chinese government's climate policies and member of CASS, told SciDev.Net, "Developed countries insist on market approaches — which is too costly for most developing countries — while developing countries want cheap climate-friendly technologies through government cooperation."

"The recommendations on various forms of joint research and development could be a feasible way to transfer technology."

Friday, March 21, 2008

New EPA Analysis Released on Climate Bills

March 14, 2008

Lieberman, Warner Welcome EPA Finding that Climate Bill Achieves Strong Results With Manageable Costs

Senators Joseph Lieberman (ID-CT) and John Warner (R-VA) today thanked the U.S. Environmental Protection Agency for completing the analysis that they had requested of their Climate Security Act (S. 2191) last November. (The slides presenting the results of EPA’s analysis are available at www.epa.gov/climatechange/economics/economicanalyses.html) The Senate Environment and Public Works Committee favorably reported the bill on December 5, 2007. The full Senate is expected to consider the measure this June.

“EPA’s detailed analysis indicates that the US can curb global warming without sacrificing economic prosperity,” Lieberman said. “We will examine the results closely for improvements that they might suggest for the bill.”

Warner said, “I am satisfied that EPA’s analysis demonstrates what we have long known: You can control greenhouse gas emissions in a manner that leaves the economy whole and is not burdensome on consumers.”

The ADAGE (Applied Dynamic Analysis of the Global Economy) computer model used by EPA projects the economic impacts of government policies that are designed to speed advanced energy technologies to market. The Climate Security Act is such a policy. ADAGE contains detailed treatment of new technology deployment in the power sector and explicitly models the global economy.

EPA has not yet updated the ADAGE model to reflect the provisions of the energy bill enacted last year. In order to approximate the underlying impact of those provisions, however, EPA selected a “high technology reference scenario” when running the Climate Security Act through the ADAGE model. That modeling run found:

Ø The Climate Security Act’s cut in cumulative US greenhouse-gas emissions is deeper than one found earlier by EPA to be consistent with keeping global CO2 concentrations below 500 parts per million in 2100. [Slide 141] The finding assumes that other developed countries reduce their emissions by less than the US, and that the developing countries do not start making similar reductions until 2025. According to the Intergovernmental Panel on Climate Change, keeping the global concentration below 500 ppm greatly decreases the risk of severe global warming impacts in the US and elsewhere.

Ø Under the conservative assumptions described above concerning action by other nations, the Climate Security Act does not shift US greenhouse-gas emissions abroad. In EPA’s words, “no international emissions leakage occurs.” [Slide 5]

Ø Under the same conservative assumptions, the Climate Security Act causes US exports of energy-intensive products (e.g., steel, cement) to developing nations to increase and causes US imports of energy-intensive products from developing nations to decrease. [Slide 83]

Ø Under the Climate Security Act, US gross domestic product grows by 80% from 2010 to 2030. That is just one percentage point less than the growth in the absence of the bill. [Slide 61]

Ø Under the Climate Security Act, average annual per-household consumption in the US grows by 81% from 2010 to 2030. That is just two percentage points less than the growth in the absence of the bill. [Slide 65]

Ø EPA notes, “The economic benefits of reducing emissions were not determined for this analysis,” [Slide 3] and “While the models do not represent benefits, it can be said that as the abatement of GHG emissions increases over time, so do the benefits of the abatement.” [Slide 108]

Ø The Climate Security Act’s allowance price and financial support for carbon capture and sequestration (CCS) make that technology a commercial reality in the US by 2015 – several years earlier than in the absence of the bill. [Slide 4]

Ø One of the effects of the accelerated CCS deployment is to drive natural gas out of the electricity sector, to the benefit of manufacturers who use natural gas. [Slide 57]

Ø Under the Climate Security Act, the price of an emission allowance is $22 in 2015 and $46 in 2030. [Slide 24] That is significantly lower than allowance price predictions made by models that ignore the recent energy bill, artificially limit technology deployment, and ignore technology incentives and cost-saving provisions of the bill.

Ø Under the Climate Security Act, increases in average US electricity prices materialize slowly and gradually. Even forty years after enactment, those prices reach a level only 18% higher than the 2005 level. [Slide 55] Over that period, the bill directs more than $1 trillion to lowering and offsetting US consumers’ actual energy costs.

The analysis also includes, at the request of critics of climate legislation, other modeled scenarios that make highly pessimistic assumptions about constraints on technology deployment, the formation of natural gas cartels, and the like. In responding to the same request last October, the Energy Information Administration concluded that an analysis would be realistic without those pessimistic assumptions.

– 30 –

Tuesday, March 11, 2008

Be Wary of the Agenda Behind Flawed Cost Projections

We've all seen the damage that can come from "studies" that are designed to achieve a given result rather than truly examining the potential cost, impacts or benefits of a given issue. It is often hard to judge the veracity of studies -- which is why it is absolutely critical that the assumptions used are transparent and reasonable -- so as to prove there is no hidden agenda being served.

The latest round of fliers and "fact sheets" being pushed by the Chamber of Commerce is unfortunately relying on a very flawed and secretive analysis done by Charles River Associates (CRA) and paid for by the electric industry group, Edison Electric Institute. The study was so flawed that many of the EEI members have called for it to be re-done using more plausible assumptions. Below is a great analysis of the many flaws of the CRA economic projections -- and why folks need to be careful before believing the cost projections of Lieberman-Warner from groups that clearly have an agenda that is not good for agriculture (i.e favoring a carbon tax instead of a carbon market).

Environmental Defense Fund

The CRA Climate Analysis: Extreme Again

America’s Climate Security Act of 2007 [S. 2191) is a bipartisan bill that would create a cap and trade program to cut greenhouse gas emissions in the U.S. The Edison Electric Institute, a trade organization representing electric utilities, recently paid consulting firm Charles River Associates International (CRA) to assess the possible economic impacts of the legislation. An assessment of CRA’s analysis using accepted academic modeling reaches the following conclusions:

· CRA has a history of presenting extreme views for its industry clients. For example, CRA’s
analysis in 2003 of the McCain-Lieberman Climate Stewardship Act projected household costs that were three to four times higher than the upper range of results in an MIT study, and 10 to 14 times higher than MIT’s lower range.

· CRA’s results are dramatically different than economic assessments by researchers in
academia and government. For example, CRA’s estimates for the impact of the bill in 2015 on
greenhouse gas emission allowance prices, economic output (GDP), and electricity prices are 75%
300% higher than those found by a study performed by researchers at Duke University and Research Triangle Institute.

· Determining exactly why CRA’s numbers are so high is difficult, both because of how CRA
reports their results and because the CRA model remains a “black box” to outsiders. Although
CRA released some information in a response to a request from Senator Lieberman, they have never fully opened up their model to outside peer review, so key assumptions remain hidden. Moreover, CRA lumps together results from various scenarios without specifying which scenarios lead to which results. One reason for the divergence from other models, however, appears to be that CRA ignores the role of international credits, which under the Lieberman-Warner bill could meet up to 15% of compliance obligations. In addition, their analysis assumes high costs for new coal-fired power plants with carbon capture and sequestration technology, and imposes artificial constraints on how widely that technology is used.

· Like most economic forecasting models, CRA’s analysis considers only one side of the ledger:
it considers the costs of reducing emissions, but fails to examine the costs of inaction.

· No single model should be relied upon for policy making. Instead, policy makers should look to
the full range of economic models for guidance on the possible impacts of climate policy. And when confronted with a range of numbers, a common rule of thumb is to throw out the lowest and highest numbers, and concentrate on the middle of the range. Former Federal Reserve Chairman Paul Volcker summarized the economic situation best: “If you don't
take action on climate change, you can be sure that our economies will go down the drain in the
next 30 years. What may happen to the dollar, and what may happen to growth in China or
whatever, will pale into insignificance compared with the question of what happens to this planet
over the next 30 or 40 years if no action is taken."

Our analysis is based on testimony by CRA, documentation supporting that testimony, CRA’s recent update to their analysis, and economic models by researchers at MIT, Research Triangle Institute, and the Department of Energy.

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