Climate Change – Page 4

Feebates

Posted on 31 August 2010 | by Jay Kimball | Leave a Comment

Keywords: Feebate, Art Rosenfeld, RMI, reducing automobile CO2 emissions, reducing oil addiction

Feebates offer a compelling approach to curbing automobile fuel consumption and CO2 emissions. The concept was pioneered in the 1970s by Jonathan Koomey and Art Rosenfeld (Lawrence Berkeley National Laboratory) and is finding renewed interest around the world.

Feebates are market-based policies for encouraging emissions reductions from new passenger vehicles by levying fees on relatively high-emitting vehicles, and using those collected fees to provide rebates to lower-emitting vehicles.

California is considering adopting a Feebate program. The UC Davis Institute of Transportation Studies recently published their analysis of a Feebate program – Potential Design, Implementation, and Benefits of a Feebate Program for New Passenger Vehicles in California. The report provides a detailed overview and analysis of Feebates and reviews Feebate programs already underway in other countries.

California Feebate UC Davis — (source: UC Davis Institute of Transportation Studies)

Rocky Mountain Institute has a good review of the Feebate approach to reducing oil consumption.

Highlights of RMI’s report Feebates: A Key to Breaking U.S. Oil Addiction

The scale of U.S. oil consumption (nearly 19 million barrels per day) combined with its virtual monopoly of transportation energy (97 percent oil-based), creates strategic weakness, economic insecurity, widespread health hazards, and environmental degradation.

Feebate is an innovative policy that greatly speeds the development and deployment of efficient vehicles.

The California Legislature actually approved a similar “Drive+” law by an astonishing seven-to-one margin in 1980, but Governor George Deukmejian pocket-vetoed it after a mixed initial reaction from automakers, and it’s been bottled up ever since.

The basic idea of a feebate is simple. Buyers of inefficient vehicles are levied a surcharge (the “fee”), while buyers of efficient vehicles are awarded a rebate (the “bate”). By affecting the purchase cost up front, feebates speed the production and adoption of more efficient vehicles, saving oil, insecurity, cost, and carbon.

Though efficient vehicles’ reduced operating costs make them a good buy over the years, consumers’ implicit real discount rates, up to 60-plus percent per year (and nearly infinite for low-income car-buyers), make miles per gallon a relatively weak economic signal: long-term fuel savings are so heavily discounted that buyers, in effect, count just the first year or two—as minor an economic choice as whether to buy floor mats.

In contrast, feebates capture the life-cycle value of efficiency (or the cost of inefficiency) and reflect it in the sticker price. By increasing the price spread between less and more efficient vehicles, feebates bridge the gap between consumers’ and society’s perceptions of the time value of money. This corrects the biggest single obstacle to making and buying efficient vehicles.

Feebates can shift purchasing patterns in the short run and spur automakers’ innovation in the medium and long run. But to do both, a feebate program, like any well intentioned policy, must be properly designed and implemented. As RMI Principal Nathan Glasgow notes, “With feebates, the devil is really in the details.”

Feebate Forum
In 2007, RMI organized and hosted the first Feebate Forum, pulling together 27 experts from the auto and insurance industries, NGOs, academia, and government to discuss feebate design and implementation schemes. Through open dialogue, the group developed a set of design recommendations, barriers, and next steps for feebates.

The participants agreed on the following design goals:

1. Metrics should be based on fuel efficiency or greenhouse gas emissions, and all types of transportation energy can be included—not just diverse fuels but also electricity.

2. The size of the fee or rebate shouldn’t depend on vehicle size. The feebate should reward buyers for choosing a more efficient model of the size they want, not for shifting size. A size-class-based feebate preserves the competitive position of each automaker regardless of its offerings, debunks the myth that consumers must choose between size and efficiency, and doesn’t restrict freedom of choice. Buyers can get the size they want; the efficiency of their choice within that size class determines whether they pay a fee or get a rebate, and how much.

3. Feebates should be implemented at the manufacturer level, so automakers, rather than a government agency, should pay the fees and collect the rebates. This lets manufacturers monitor results and adjust their vehicle mix accordingly, and it avoids any need for taxpayers to foot the bill for any costs. However, a good feebate program should be revenue-neutral, with “fees” paying for “bates” plus administrative costs—a potentially attractive feature. And since the “fees” are entirely avoidable by choice, they’re not a tax.

4. The “pivot point” between fees and rebates should be adjusted annually, so the program is trued up to stay revenue-neutral, and automakers have a predictable and continuous incentive to improve the efficiency of their offerings, spurring innovation.

5. Feebates should be designed for complete compatibility with efficiency or carbon-emissions standards, so automakers aren’t whipsawed between incompatible incentives or requirements. In practice, feebates may drive efficiency improvements much larger and faster than standards require, making the standards unimportant except to prevent recidivism.

France introduced the largest feebate program to date

Averaging 133 grams of carbon dioxide per kilometer for the 2009 new light-vehicle fleet, France’s vehicles now have the lowest carbon emissions in the European Union.

By comparison, the UK’s 2009 new vehicles emitted, and the EU average is, 146. Between 1995 and 2007 (when the French feebate was introduced at year-end), the emissions rate of new vehicles sold in France was falling at an average rate of 2.25 grams of carbon dioxide per kilometer per year. During the first two years of the feebate program, the annual emissions decrease more than tripled to 8 grams per kilometer. Overall, the efficient bonus vehicles’ market share nearly doubled, from 30 to 56 percent, while the inefficient malus vehicles’ share fell threefold, from 24 to 8 percent.

The French program was not size-neutral as RMI recommends for the U.S., and the data show it shifted new-car buyers toward smaller vehicles. The market share of the smallest (economy) cars grew from 44 percent in 2007 to 57 percent in 2009, much as we’d expect for such a fleetwide feebate structure: smaller vehicles tend to have higher efficiency and lower carbon emissions, so unless unusually inefficient, they’ll earn a rebate that’s attractive to many buyers. For the U.S., RMI recommends a size-neutral feebate design to shift the entire market toward lighter, more aerodynamic, and advanced-powertrain vehicles, not just smaller ones.

California is currently considering the introduction of a statewide feebate bill

A state program would probably do more to shift the in-state vehicle sales mix than to spur innovative design, since even a market as big as California represents only a fraction of the U.S. auto market. Nonetheless, RMI is following this program closely.

In 2008, California’s aggressiveness on fuel efficiency spurred higher national CAFE standards, and a number of other states follow California’s lead on Clean Air Act and related policies. States and regions can make fine laboratories for refining policy innovations that later guide uniform national policies.

Bjørn Lomborg Changes His Mind About Climate Change

Posted on 31 August 2010 | by Jay Kimball | 2 Comments

Keywords: Bjørn Lomborg, skeptical environmentalist, climate change, Howard Friel, The Lomborg Deception, carbon tax

Bjørn Lomborg, infamous “skeptical environmentalist,” has changed his mind about climate change. According to an article in The Guardian:

The world’s most high-profile climate change sceptic is to declare that global warming is “undoubtedly one of the chief concerns facing the world today” and “a challenge humanity must confront“, in an apparent U-turn that will give a huge boost to the embattled environmental lobby.

Lomborg has a new book coming out in a few weeks and this will certainly create buzz around the book. The Guardian says:

Bjørn Lomborg, the self-styled “sceptical environmentalist” once compared to Adolf Hitler by the UN’s climate chief, is famous for attacking climate scientists, campaigners, the media and others for exaggerating the rate of global warming and its effects on humans, and the costly waste of policies to stop the problem.

But in a new book to be published next month, Lomborg will call for tens of billions of dollars a year to be invested in tackling climate change. “Investing $100bn annually would mean that we could essentially resolve the climate change problem by the end of this century,” the book concludes.

Examining eight methods to reduce or stop global warming, Lomborg and his fellow economists recommend pouring money into researching and developing clean energy sources such as wind, wave, solar and nuclear power, and more work on climate engineering ideas such as “cloud whitening” to reflect the sun’s heat back into the outer atmosphere.

In a Guardian interview, he said he would finance investment through a tax on carbon emissions that would also raise $50bn to mitigate the effect of climate change, for example by building better sea defences, and $100bn for global healthcare.

Global Carbon Emissions 2010 — (source: EIA, CDIAC, Raupach et al. 2007, Proceedings of National Academy of Sciences)

Most news outlets reporting on Lomborg’s turn-around are simply repeating the provocative bullet points of this story. To the Guardian’s credit, they ran a second article by Howard Friel, author of The Lomborg Deception, that brings some balance to the Lomborg stealth PR campaign. For example, Friel points out Lomborg still is not calling for reduction of CO2 emissions:

Here’s where the missing question comes into play, since Lomborg does not seriously address the fundamental problem of rising atmospheric CO2 concentrations in the absence of global greenhouse reductions: what will happen to the earth and human civilisation when atmospheric CO2 concentrations rise – essentially unchecked, if we followed Lomborg’s recommendations – to 450 parts per million, 550ppm, 700ppm, 800ppm; and when the average global temperature rises by 2C, 3C, and 4C to 7C?

Climate scientists have set 350ppm and a 2C average temperature rise (from 1750 to 2100) as the upper range targets to prevent a global climate disaster. Since we are already at 390ppm and since a 2C plus rise is a near certainty, how does Lomborg’s appeal to forgo sharp reductions in CO2 emissions reflect climate science? He argues that there are “smarter solutions to climate change” than a focus on reducing CO2. This is hardly smart: it’s insanity.

As one commenter noted:

The denialists are like a chain-smoker with emphysema who rants at his doctor for telling him to quit.

Lomborg has left this crowd and has progressed, very late, to the bargaining stage. “Doctor, is there some medicine I can take? What if I cut down to two packs from three a day?”

For an example of someone coming late to the discussion, but thinking big about how to take on the enormous challenges posed by climate change, see Bill Gates on Climate Change and Renewable Energy. Here’s an excerpt from that article:

Many newspapers and blogs are reporting on the Technology Review interview with Bill Gates (highlights below). Though that interview contains some good information, Gates’ presentation at TED was the stake in the ground that set the stage for this Technology Review interview. At TED, Gates called for reducing carbon emissions to zero. The presentation is worth watching. Considering that Gates is one of the most public faces of big business, his statements at TED are noteworthy:

climate change is real

climate change is the most important challenge on the planet

carbon emissions need to be reduce to zero as soon as possible, his goal is by 2050

increased investment in energy R&D is essential, and can be done at reasonable levels

zero carbon energy production makes business sense

Bill Gates on Climate Change and Renewable Energy

Posted on 25 August 2010 | by Jay Kimball | 11 Comments

Keywords: Bill Gates, climate change, energy, renewable energy, TED, zero carbon emmissions

Many newspapers and blogs are reporting on the Technology Review interview with Bill Gates (highlights below). Though that interview contains some good information, Gates’ presentation at TED was the stake in the ground that set the stage for this Technology Review interview. At TED, Gates called for reducing carbon emissions to zero. The presentation is worth watching. Considering that Gates is one of the most public faces of big business, his statements at TED are noteworthy:

climate change is real
climate change is the most important challenge on the planet
carbon emissions need to be reduce to zero as soon as possible, his goal is by 2050
increased investment in energy R&D is essential, and can be done at reasonable levels
zero carbon energy production makes business sense

Highlights from Technology Review interview with Bill Gates

On US Investment in Energy

TR: You are a member of the American Energy Innovation Council, which calls for a national energy policy that would increase U.S. investment in energy research every year from $5 billion to $16 billion. I was stunned that the U.S. government invests so little.

BG: I was stunned myself. The National Institutes of Health invest a bit more than $30 billion.

On Carbon Tax

It’s ideal to have a carbon tax, not just a price on carbon, which is this fuzzy word that includes cap-and-trade. You’re using the tax to create a mode shift to a different form of energy generation. And then you just take all the carbon-emitting plants, you look at their lifetime, and you say on a certain date this one has to be shut down and when a new one is put in place, it has to be low-CO2-emitting.

That’s a regulatory approach, and it’s very clear. Innovators are designing things for the power-plant buyers 10 years from now, who are looking at the regulatory and tax environment for the next 40 years. If you said to a utility company executive, which is more likely to stay in place: a cap-and-trade thing, whose price will vary all over the map, that will have some international things that will be shown to be a waste of money? Or a tax and a regulatory framework for plant replacement over the next 50 years? We should have a carbon tax. What we owe the developing world is this: we’re willing to pay high prices for energy plants above coal and drive prices down the curve so by the time they need to buy them, they don’t have to pay the high price.

Which is more likely: a carbon tax with all sorts of markets and options and uncertainties about prices, and traders in the middle, and confusion about who initially gets the most advantage? Or a regulatory thing and a 2 percent tax to fund the R&D so that utilities know they can buy a plant that’s emitting hardly any CO2? Raising energy prices by 2 percent and sending it to R&D activities seems easier in a weak economy than raising them 20 percent. Now, 0 percent is the easiest option of them all, but unfortunately, that doesn’t get us the solution to this problem.

The CO2 problem is simple. Any amount you emit causes warming, because there’s about a 20 percent fraction that stays for over 10,000 years. So the problem is to get essentially to zero CO2 emissions. And that’s a very hard problem, because you have sources like agriculture, rice, cows, and small sources out with the poorest people. So you better get the big sources: you better get rich-world transportation, rich-world electricity, and so on to get anywhere near your goal. If X or Y or Z gets you a 20 percent reduction in CO2, then you’ve just got the planet, what, another three years? Congratulations! I mean, is that what we have in mind: to delay Armageddon for three years? Is that really it?

The U.S. uses, per person, over twice as much energy as most other rich countries. And so it’s easy to say we should cut energy use through better buildings and higher MPG and all sorts of things. But even in the most optimistic case, if the U.S. is cutting its energy intensity by a factor of two, to get to European or Japanese levels, the amount of increased energy needed by poor people during that time frame will mean that there’s never going to be a year where the world uses less energy. The only hope is less CO2 per unit of energy. And no: there is no existing technology that at anywhere near economic levels gives us electricity with zero CO2.

On Renewable Energy

Almost everything called renewable energy is intermittent. I have another term for it: “energy farming.” In fact, you need not just a storage miracle, you need a transmission miracle, because intermittent sources are not available in an efficient form in all locations. Now, energy factories, which are hydrocarbon and nuclear energy–those things are nice. You can put a roof on them if you get bad weather. But energy farming? Good luck to you! Unfortunately, conventional energy factories emit CO2 and that is a very tough problem to solve, and there’s a huge disincentive to do research on it.

I think Gates approach to energy storage and transmission is too brute force. We are early into innovating alternative energy, and already there are some good innovations showing up that provide solutions to wind and sun intermittence. See Using Water Heaters to Store Excess Wind Energy for a good example of innovations that use existing infrastructure for storage and transmission.

Google: Implications of California’s Proposition 23

Posted on 12 August 2010 | by Jay Kimball | 4 Comments

Keywords: Google, California Proposition 23, Vinod Khosla, William Wiehl, cleantech, A.B. 32

Google convened an event at their Silicon Valley campus to discuss the implications of California’s Proposition 23, an attempt to rollback the state’s ambitious climate legislation (A.B. 32). In an article at Greentech Media, panelists, including venture capitalist Vinod Khosla, sounded upbeat on contributions California cleantech ventures will make toward solving US energy and climate challenges.

Highlights from Google’s Implications for California Proposition 23 Event

Khosla stole the show with his outlook for the clean-tech innovation and energy use. “In 10 to 15 years, we will be shutting down (power) plants” because of an excess of electricity in this country, Khosla said. There is an “infinite” opportunity for technological innovation.

Khosla’s firm is backing companies that hope to cut energy use in lighting and data center server racks by 80 percent.

Regarding China’s serious investment in cleantech, Khosla said “I won’t say China is winning the cleantech race,” he says. “But they are clearly paying a lot more attention to the race.”

Asked if there was an advantage to creating companies in Silicon Valley rather than China, Khosla was emphatic. “No question about it. The people are here. The markets are here.”

According to Khosla, nuclear power no longer has an advantage over renewables. There hasn’t been a nuclear plant build in recent years that can beat $7,000 a kilowatt. That makes wind and solar (in some parts of the world) competitive, he says.

Proposition 23 is a threat because it will kill the clean-energy markets that California’s A.B. 32 created. Both Khosla and Google Green Energy Czar William Wiehl concur on this point. Proposition 23, which will go to the ballot in November, would suspend A.B. 32 [see note below for background on A.B 32] until the state’s unemployment rate drops to 5.5 percent or less for four consecutive quarters. Texas oil companies Valero and Tesoro back the measure. A.B. 32 sets reporting guidelines for polluters, establishes a statewide limit for carbon, and guides emissions back to 1990 levels by 2020.

A.B. 32 has helped create 500,000 cleantech jobs in California, Wiehl says.

Google, adds Wiehl, has made strides with energy efficiency. The company builds its own data centers and servers. As a result, data center energy use is half of what it would be if the company followed industry-standard best practices, he said.

As to the next Google — “There is no doubt in my mind we will see 10 of these” in cleantech, says Khosla. “Today, California has the pole position to win that race.”

Note:

California’s major initiatives for reducing climate change or greenhouse gas (GHG) emissions are outlined in Assembly Bill 32 (signed into law 2006), 2005 Executive Order and a 2004 ARB regulation to reduce passenger car GHG emissions. These efforts aim at reducing GHG emissions to 1990 levels by 2020 – a reduction of approximately 30 percent, and then an 80 percent reduction below 1990 levels by 2050. The main strategies for making these reductions are outlined in the Scoping Plan. Also provided here are links to state agencies and other groups working on climate issues which are being coordinated by the state’s Climate Action Team.

More on the California’s Prop 23 initiative here:

California’s Prop 23 Morphing into Prop 26

Atlantic Hotter Than Before Katrina, Boosting Storm Forecasts

Posted on 10 August 2010 | by Jay Kimball | 4 Comments

Keywords: hurricane, climate change, global warming, impact of climate change, cost of climate change

As the world gets warmer, weather forecasters and insurance companies expect increased storm activity, more severe storms, and increased storm-related damage. In an article in Bloomberg, meteorologists at the US National Hurricane Center are predicting Katrina sized storms, saying “The storms we will be talking about in the next few weeks will be the real deal. These will be big-sized hurricanes.”

The chart at right shows the trend. There have been four times as many weather-related disasters in the last 30 years than in the previous 75 years. (NB: Data comes from Center for Research on the Epidemiology of Disasters)

According to the National Hurricane Center, 10 of the 30 costliest American hurricanes have struck since 2000, even after adjusting the figures for inflation and the cost of construction.

Highlights of Article: Atlantic Hotter Than Before Katrina, Boosting Storm Forecasts

If all the storms forecast by Colorado State materialize, 2010 will be tied with 1969, the fifth-busiest season on record.

Energy companies are reacting to the first signs of danger. They halted 26 percent of oil production and 14 percent of natural-gas output in June, when Hurricane Alex churned through the Gulf into Mexico, according to the Bureau of Ocean Energy Management, Regulation and Enforcement. The operators idled 52 percent of oil and 24 percent of gas output the following month before Tropical Storm Bonnie dissolved south of Louisiana.

Five years ago, in the most-active hurricane season on record, Hurricanes Katrina and Rita killed more than 1,800 people, caused $91 billion in damage, destroyed 115 energy platforms in the Gulf, and shut down 95 percent of Gulf oil production and almost 30 percent of U.S. refining capacity, according to government reports. Gasoline prices soared to as much as $5 a gallon and shortages were reported across the South.

The Gulf of Mexico is home to about 31 percent of U.S. oil output and about 10 percent of gas production, according to the Energy Department. It’s also the site of the worst oil spill in U.S. history, caused by the April 20 explosion at BP Plc’s leased rig. The spill is still being cleaned up.

If all Gulf platforms were closed, the daily production loss would be $160 million to $170 million, based on current prices, according to AIR Worldwide, a catastrophe risk-modeling firm.

A repeat of Katrina also would cause $6 billion to $9 billion in damage to offshore platforms, rigs and wells, according to models created by Risk Management Solutions Inc. of Newark, California.

Since 1995, when a cyclical increase in Atlantic hurricanes began, 89 percent of all storms have formed after Aug. 1, according to the hurricane center. The hurricanes that do about 85 percent of the damage when they hit land typically form between Aug. 20 and Oct. 20, Gray said.

Sea surface temperatures in the mid-Atlantic between the Lesser Antilles and the African coast averaged 1.2 degrees Celsius (about 2.2 degrees Fahrenheit) above normal from March to June, warmer than the 0.92 degrees in 2005, said Richard Pasch, a senior specialist at the Miami hurricane center. “That’s the fuel for tropical cyclones, the water vapor that’s evaporated from warm ocean surface,” he said.

Colorado State, in Fort Collins, forecast 18 storms for 2010, and the National Oceanic and Atmospheric Administration predicts 14 to 20 from June 1 through Nov. 30.

Climate Change, Food, and Wildfires

Posted on 06 August 2010 | by Jay Kimball | Leave a Comment

An article in the New York Times (Russia, Crippled by Drought, Bans Grain Exports) details Russia’s struggle with severe drought. Though any particular instance of drought can’t be directly linked to climate change and global warming, the world is warming, and instances of drought and associated wildfires, water shortages and crop loss are trending up.

The article highlights the tight coupling between food, water, and a warming world. It also shows how one countries problem affects us all, for example, Russia’s ban on grain exports has doubled the price of wheat worldwide.

For more on climate change and impact on food, see:

NOAA: June, April to June, and Year-to-Date Global Temperatures are Warmest on Record

State of the Climate: Hottest Decade on Record

Water Scarcity in the US

Climate Change May Reduce Protein in Crops

Highlights of the article – Russia, Crippled by Drought, Bans Grain Exports

Prime Minister Vladimir V. Putin on Thursday banned all exports of grain after millions of acres of Russian wheat withered in a severe drought, driving up prices around the world and pushing them to their highest level in two years in the United States.

Russia is suffering from the worst heat wave since record-keeping began here more than 130 years ago.

The export ban was widely seen as one of a series of populist moves by Mr. Putin to address rising resentment over the calamitous heat wave and the fires it has spawned.

Wheat prices have soared by about 90 percent since June because of the drought in Russia and parts of the European Union, as well as floods in Canada, and the ban pushed prices even higher. Exports from Ukraine, another major exporter, are down sharply this year.