Weekly Climate Change Policy Update - February 17, 2009

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Article by Kyle W. Danish, Shelley N. Fidler, Andrea Hudson Campbell, Kevin M. Gallagher and Megan Ceronsky

Commentary

EPA is moving forward with its registry for mandatory GHG emissions reporting . . . Substantial funding for clean energy survived in the final version of the stimulus bill . . . The composition of the key Senate committees – Energy & Natural Resources and Environment & Public Works – is taking shape . . . In Europe, problems with the economy have translated into plunging prices for allowances in the European Union Emissions Trading System.

Executive Branch

• EPA Set to Propose Delayed GHG Registry. EPA has sent its proposal for a comprehensive and mandatory greenhouse gas (GHG) emissions reporting program to the White House Office of Management and Budget for final review before publication in the Federal Register. The proposal had been initiated under the Bush Administration and was subsequently suspended for review by the Obama Administration. The EPA action came just days after Sens. Dianne Feinstein (D-CA), Barbara Boxer (D-CA), Amy Klobuchar (D-MN) and Olympia Snowe (R-ME) wrote to EPA Administrator Lisa Jackson and urged quick progress on establishing the registry to ensure that reporting begins in 2010.
• NOAA Nominee Proposes National Climate Service. While testifying before the Senate Commerce Committee, President Obama's nominee to head the National Oceanographic and Atmospheric Administration, Jane Lubchenco, vowed to create a National Climate Service akin to the National Weather Service if she is confirmed. Lubchenco testified that a National Climate Service would synthesize scientific data on climate change and local climate change impacts. John Holdren, President Obama's nominee for White House science advisor, also appeared before the Commerce Committee. Holdren testified that scientific research indicated that "climate change is real, it is accelerating, it is caused in large part by human activities, it is dangerous and will become more so in the future."

Congress

• Energy Provisions Remain Largely Intact in Conference Stimulus Bill. The compromise stimulus legislation passed by Congress retained major investments in low carbon energy, including $30 billion in direct spending to support energy efficiency, smart grid technology, and advanced battery research programs, and $20 billion in tax incentives for renewable energy and energy efficiency. Specifically, the legislation provides for:
• • grants of up to 30% of project development costs that clean energy developers can use in lieu of federal tax credits to secure project financing;
  • 3-year extensions of the tax credit provisions for wind, biomass, geothermal, hydropower, landfill gas, waste-to-energy, and marine renewable power projects;
  • an extension of tax credits for making energy efficiency improvements to existing homes;
  • $4 billion in renewable energy bonds for State and local governments;
  • tax credits for investing in the manufacture of equipment used in advanced energy projects;
  • $3.4 billion for research and development programs to advance carbon capture and sequestration technologies;
  • $5 billion for weatherization of modest-income homes;
  • over $5 billion to make Federal buildings more energy efficient;
  • $4 billion for energy efficiency improvements in federally-funded housing programs;
  • $3 billion for the National Science Foundation, for basic research in science and engineering;
  • $1.6 billion for the Department of Energy's Office of Science, the largest supporter of basic physical sciences research in the U.S. (including climate science, biofuels, high-energy physics, nuclear physics and fusion energy);
  • $400 million for the Advanced Research Projects Agency for Energy (ARPA-E), designed to bring together the best minds from industry, academia, and government to pursue "high-risk, high-payoff" energy research;
  • $400 million for NASA climate research; and
  • $8 billion in funding for high-speed rail.

• Senate Energy, EPW Committees Reshaped. Both the Senate Energy and Natural Resources Committee and the Environment and Public Works Committee will have new members and new subcommittee leadership in the 111th Congress. In the Energy and Natural Resources Committee, Sen. Maria Cantwell (D-WA) will assume leadership of the Energy Subcommittee, Sen. Mark Udall (D-CO) will head the National Parks Subcommittee, and Sen. Debbie Stabenow (D-MI) will lead the Water and Power Subcommittee, with Sen. Ron Wyden (D-OR) retaining chairmanship of the Public Lands and Forests Subcommittee. Freshman Sen. James Risch (R-ID) will become ranking member of the Energy Subcommittee and Sen. Sam Brownback (R-KS) will serve as ranking member of the Water and Power Subcommittee. Sens. Evan Bayh (D-IN), Bob Bennett (R-UT), John McCain (R-AZ), and Jeanne Shaheen (D-NH) will also join the full committee. In the Environment and Public Works Committee, climate change will be handled at the full committee level in the new Congress, signaling the importance of the issue. Separate subcommittees will be devoted to green jobs, (EPA) oversight, and children's health issues, to be headed by Sens. Bernie Sanders (I-VT), Sheldon Whitehouse (D-RI), and Amy Klobuchar (D-MN), respectively. Sen. Frank Lautenberg (D-NJ) will take over the Superfund, Toxics and Environmental Health Subcommittee from Sen. Max Baucus (D-MT), who will remain chair of the Transportation and Infrastructure subcommittee. Sen. Ben Cardin (D-MD) will become chair of the newly created Water and Wildlife Subcommittee, and Sen. Tom Carper (D-DE) will continue as chair of the Clean Air and Nuclear Safety Subcommittee.
• House Subcommittee Chair promises legislation by Memorial Day. Ed Markey (D-MA), chairman of the House Energy and Environment Subcommittee of the House Energy and Commerce Committee as well as the Select Committee for Energy Independence and Global Warming, said this week he will press forward with climate-change legislation ahead of December's United Nations Climate Change summit in Copenhagen. "We want to be ready so the president can go to Copenhagen in December as the world leader,'' he said. Markey said the debate in Congress was no longer focused on whether to pass climate change legislation but on how much to spend on it. His committee's goal is to complete legislation by Memorial Day so it can go to the House floor. "We know the G8 and the rest of the world is waiting for the United States to stop being the laggard and be the leader," Markey told CERAWEEK, an energy conference in Houston that began on Monday. "There are potentially catastrophic consequences for the planet if we do not act.'' Markey said that neither the government nor the private sector has invested enough in combating greenhouse gas emissions. "The tools to solve these problems, in many instances, have not been invented yet,'' Markey said. He urged Congress to set market-driven policies to give energy companies certainty and opportunities to participate in the "revolution" about to take place around climate change. He likened it to the developments that took place in telecommunications sector. "We must now do the same thing in the energy sector,'' Markey said. "This is all inevitable. Ten or 20 years from now this revolution will be completed."

States and Cities

• California Bill Would Add NF₃ to GHGs Regulated Under State Climate Change Law. Legislation submitted to the California Senate would grant the California Air Resources Board (CARB) authority to regulate nitrogen trifluoride (NF₃) as a GHG under the state's AB 32 climate change law. AB 32 currently regulates the six gases covered by the Kyoto Protocol: CO₂, methane (CH₄), nitrous oxide (N₂O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulfur hexafluoride (SF₆).
• New Mexico Legislation Would Authorize WCI Implementation Regulations. A bill introduced in the New Mexico legislature would grant the state Environmental Improvement Board (EIB) authority to draft rules to implement the Western Climate Initiative (WCI), a regional cap-and-trade program composed of seven western states and four Canadian provinces. The EIB currently has statutory authority to regulate traditional sources of GHGs, but requires additional legislation to implement the WCI. The legislation would allow this by granting the EIB authority to establish a cap-and-trade program, and to regulate emissions related to power imported into the state and transportation fuel combustion.
• RGGI Bill Introduced in Texas Legislature. A Democratic Texas State Representative has introduced legislation in the Republican-dominated Texas Legislature that would establish a state-wide GHG cap-and-trade program and enable the state to participate in the Regional Greenhouse Gas Initiative (RGGI). RGGI is a regional GHG cap-and-trade program in the northeast. Current members include Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island and Vermont.

Studies and Reports

• Study Finds Biofuels Could Partially Displace Gasoline in Near Term. According to a joint study by Sandia National Laboratories and General Motors Corp., cellulosic ethanol produced from dedicated energy crops as well as plant and forestry waste, in combination with a smaller amount of corn-based ethanol, could replace nearly a third of U.S. gasoline use by 2030. The projection assumes that technical and scientific progress continues at expected rates, and the authors note that support of R&D and commercialization ventures will be critical to ensure this progress. The study also projected that cellulosic ethanol could compete with oil priced at $90 a barrel without any government support by that time. An executive summary of the report is available at http://hitectransportation.org/news/2009/Exec_Summary02-2009.pdf.
• Carbon Sequestration Would Create Jobs. An analysis by the economic research firm BBC Researching and Consulting found that generating 20 gigawatts of coal-based electricity using carbon capture and sequestration technology would create 1.4 million construction jobs, while 100 gigawatts would create 6.9 million construction jobs. Associated permanent jobs generated throughout the economy would range from 48,000 to 235,000. The study, which was created for a number of labor and energy industry groups, is available at http://www.americaspower.org/Media/Files/BBC-Economic-Study.
• Study Details Effects of Climate Change on Northwest. A study on climate change impacts in the Northwest commissioned by the Washington State Legislature projects dramatic reductions in spring snowpack, water shortages, rising stream temperatures (which could degrade salmon habitat), large increases in the area annually burned by wildfires, more common extreme precipitation events, and rising numbers of heat- and air-pollution related deaths over the next century. The research, by the Climate Impacts Group at the University of Washington, is the most detailed projection of climate change impacts in the Northwest to date. The Washington Climate Change Impacts Assessment is available at http://cses.washington.edu/cig/res/ia/waccia.shtml.
• Wind Power Usage Requires Dramatic Infrastructure Investment. A new study predicts that five percent wind energy penetration by 2024 in the eastern U.S. will require $50 billion for 10,000 miles of new extra-high-voltage transmission lines; 20 percent wind penetration would necessitate $80 billion for 15,000 miles of transmission lines. Transmission investments would still be small relative to capital expenditures in generation infrastructure, which would be $700 billion and $1.1 trillion for the two scenarios. The study was produced by the Joint Coordinated System Plan, a collaboration between several transmission organizations: the Midwest ISO, PJM, Interconnection LLC, Southwest Power Pool Inc., Tennessee Valley Authority, Mid-Continent Area Power Pool, and SERC Reliability Corp. An executive summary is available at http://www.jcspstudy.org/.

International

• Major Emitters Hold Informal Meeting on Post-Kyoto Treaty. Representatives from 20 major emitting nations met in Tokyo, Japan for the Seventh Informal Meeting on Further Actions Against Climate Change. At the meeting, representatives from the United States, China, and India, among others, shared informal opinions on issues ranging from GHG emission targets for developed nations to mitigation assistance for developing nations. Participants at the meeting represented nations accounting for approximately 70 percent of global GHG emissions.
• Nearly 400 European Cities Commit to Out-Perform E.U. GHG Emission Limits. At a meeting in Brussels, Belgium, mayors from nearly 400 European cities signed an agreement committing their cities to strict GHG reductions. Under the "Covenant of Mayors" (Covenant), each city committed to out-perform the European Union's (E.U.) commitment of reducing emissions 20 percent below 1990 levels by 2020 and to create an action plan to achieve the reductions within twelve months. The Covenant did not specify the exact amount of the required emission reductions. Covenant signatories represent some of the largest cities in Europe and have a total population of 60 million people in 30 different countries.
• German Environment Ministry Issues Climate Plan. The German environment ministry released a climate change plan detailing specific energy policies intended to help the nation achieve its target of reducing GHG emissions to 40 percent below 1990 levels by 2020. The plan endorses a 20 percent reduction in transportation emissions from 2005 levels; an 11 percent reduction in power consumption and 25 percent reduction in heat consumption through energy efficiency measures; a phase-out of nuclear power by 2022; and increased efficiency from coal-fired power plants.
• Canadian Bill Would Establish Mandatory National Emissions Cap. Legislation introduced by Canada's opposition National Democratic Party would establish a long-term national GHG emission reduction target. Titled the Climate Change Accountability Act, the bill would cap Canadian GHG emissions at 25 percent below 1990 levels by 2020, and 80 percent below by 2050. The bill, which is similar to failed legislation that was introduced in 2006, includes provisions authorizing regulations to enforce the emissions caps.

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