In the News
Federal Judge Blocks Enforcement of California Low Carbon Fuel Standard
Marlo Lewis, GlobalWarming.org, 5 January 2012
The Climate Change Message Is Not Being Heard; Here’s How to Change Tack
Sunny Hundal, Guardian, 5 January 2012
Could Climate Change Create Deadly, Mutant Sharks Which Kill Us All?
James Delingpole, Telegraph, 3 January 2012
News You Can Use
Bad News for Electric Cars
Last week, we reported that electric vehicles receive subsidies of up to $250,000 per car. Recent news suggests this money is poorly spent.
- General Motors is calling back about 8,000 Chevy Volts sold in the U.S in the past 2 years after three Volt batteries caught fire, occurring between 7 days and 3 weeks after crash tests were done by federal regulators. Government subsidies for the Volt: $3 billion
- Fisker Automotive is recalling 239 Karma hybrid cars to fix a malfunction in the vehicle’s high-voltage battery, whose battery provider (A123) is contracted to build GM’s future all-electric Chevrolet Spark minicar. Fisker received a $500 million loan guarantee from the same Department of Energy office responsible for the Solyndra debacle.
- A Nissan Leaf was reported to have needed 4 stops to recharge over the course of a 180-mile drive due to its unanticipated rapid drop in charge. Government loan for the Leaf: 1.4 billion.
Inside the Beltway
Ethanol Lobby’s Absurd Spin
Bob Dinneen, president of the Renewable Fuels Association, published an op-ed in the Hill this week in which he claims that the ethanol industry is so public spirited that they have voluntarily given up their tax subsidy of 45 cents per gallon.
Dinneen writes: “Without any opposition from the biofuels sector, the tax credit for ethanol blenders (the Volumetric Ethanol Excise Tax Credit – VEETC) expired on January 1. In fact, American ethanol may well be the first industry in history that willingly gave up a tax incentive.”
That sounds admirable, but Dinneen fails to mention that the ethanol industry and corn growers still benefit from a colossal federal mandate enacted in 2007 by the Democratic-controlled Congress and signed by Republican President George W. Bush. In 2012, the mandate will require Americans to buy roughly 12 billion gallons of corn ethanol blended into gasoline.
The ethanol mandate raises transportation fuel prices, and as an added bonus it also raises food prices. How patriotic!
Unsurprisingly, Republican voters in Iowa, the top corn-producing State, chose two corn-friendly candidates in their presidential caucuses this week. Former Massachusetts Governor Mitt Romney and former Pennsylvania Senator Rick Santorum finished in a dead heat. According to the Des Moines Register, the Iowa Corn Growers Association gave Romney a B grade and Santorum an A minus in their rating of the candidates.
Former House Speaker Newt Gingrich got the top grade from the Iowa Corn Growers, but finished fourth. The two lowest-rated candidates, Texas Governor Rick Perry and Representative Michele Bachmann (R-Minn.), finished fifth and sixth in the caucuses. Perry’s energy plan can be found here. Perry proposes to eliminate energy subsidies and mandates and let the free market work.
The Register article describes Rep. Ron Paul’s (R-Tex.) position on tax subsidies incorrectly: “…Paul, a libertarian who opposes government subsidies of any kind, finished third….” In fact, Paul supports a wide variety of tax subsidies on the grounds that they allow private individuals and companies to keep money that would otherwise go to the federal government. The fact that tax subsidies are designed to benefit some well-connected people at the expense of others, who are not so politically influential, does not bother Paul. For example, Paul is a co-sponsor of the NAT GAS Act (H. R. 1835), which would give billionaire T. Boone Pickens billions of more dollars in tax subsidies.
Across the States
Texas Wins Stay of Cross State Air Pollution Rule
The federal D.C. Circuit Court of Appeals this week granted Texas’s request for a stay of EPA’s implementation of the Cross-State Air Pollution Rule (CSAPR). In September, Texas Attorney General Greg Abbott filed suit against EPA over the rule, alleging that EPA violated federal administrative procedure law by failing to allow Texas to evaluate and comment on the regulation. In the proposed CSAPR, Texas was found to be in compliance with the regulation’s particulate matter emissions limits. Without notice, in the final rule, EPA imposed the harshest particulate matter emissions limits for Texas. The technology required by EPA’s final CSAPR requires three years to install, but EPA gave the State only 6 months to do so. Recently, the non-partisan operator of Texas’s power grid warned that the CSAPR could lead to blackouts. The regulation was slated to go into effect January 1, but the D.C. District Court delayed its implementation until it could determine the merits of Texas’s case.
Around the World
Climate Trade War Brewing
The arrival of the new year marks the beginning of forced participation in the European Union’s cap-and-trade scheme for international airlines that arrive or depart from E.U. airports. A lawsuit brought by U.S. and Canadian-based airlines was dismissed late last month by an E.U. court. As a result, United-Continental, Delta and U.S. Airways have added a surcharge for passengers headed towards countries in the European Union.
China and India have signaled that they are considering retaliatory measures and are unlikely to comply with the program. Somewhat surprisingly, the Obama Administration has angered environmentalists by going to bat for the airlines on this issue, perhaps to support unionized workers in the airline or related industries. The latest announcement from Secretary of State Hillary Clinton stated that the U.S. would take “appropriate action” if the E.U. doesn’t back down, and requested information from European airlines on revenues and carbon allowances, perhaps signaling that a retaliatory tax is in the works.
As the Wall Street Journal wrote: “The EU admits the scheme will raise ticket prices and dampen consumer demand, which may be the point: to make carbon-spewing international travel accessible to fewer people.”