Writing in The Hill’s Congressional Blog, lobbyist in chief for the ethanol industry Bob Dineen waxes poetic about the historic nature of the ethanol industry voluntarily giving up losing one of its subsidies, the Volumetric Ethanol Excise Tax Credit (VEETC):
With growing concerns about gridlock in Washington and greed on Wall Street, Americans are wondering whether anyone with a stake in public policies is willing to sacrifice their short-term advantage for a greater good.
Well, someone just did.
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. Facing up to the fiscal crisis in this country, industry advocates have engaged in discussions with the Administration, Congress and our own constituents in an effort to frame forward-looking policies that balance the needs for deficit reduction and the development of clean-burning, American-made motor fuels.
Incentives should help emerging industries to develop and grow, not to be forever subsidized by the nation’s taxpayers. The Volumetric Ethanol Excise Tax Credit — which actually accrued to biofuels blenders, not producers – has helped the renewal fuels industry to stand on its own two feet. So now it is time for this subsidy to be phased out. [click to continue…]
This just in. An AP story posted on Fox News reports that GM will ask Volt owners to bring in their vehicles to dealers for fire hazard-related structural modifications. Here’s the AP story in full:
Last week, Judge Lawrence O’Neill of the U.S. District Court in Fresno issued a preliminary injunction blocking enforcement of California’s Low Carbon Fuel Standard (LCFS), a regulation requiring a 10% reduction in the carbon content of motor fuels sold in the state by 2020. O’Neill concluded that the LCFS violates the Commerce Clause of the U.S. Constitution because it discriminates against out-of-state economic interests and attempts to control conduct outside the state’s jurisdiction. [click to continue…]
The shale-gas revolution in the United States has led to massive increases in natural gas production, increasing our domestic supply and reducing prices. While global trade in natural gas exists, the infrastructure and volume is low enough such that there isn’t much of a single global price for natural gas (unlike oil, where there are a few prices which tend to stick close to one another). You can look at spot prices for various countries here, note the large disparity.
The shale gas revolution in the U.S. has been so enormous that infrastructure that was built with the expectation of importing natural gas is now being switched to export natural gas to other countries. Congressman Ed Markey (D-Mass.) is apparently concerned that producers of natural gas in the U.S. would like to export some of the excess to take advantage of higher prices in other parts of the world. Yet as Markey so often likes to point out, America has in recent decades consumed more oil than we produced. If other countries had decided 40 years ago to shut off their oil exports to keep domestic prices as low as possible, America would be a much different place today (and much worse off).
Believe it or not, low energy prices are good for countries other than just the United States. Trade helps make this possible, so its odd that Markey would want to restrict natural gas exports: [click to continue…]
Environmental degradation in the third world, we are told, is caused by ruinous free-market capitalism that tramples the common environment for private gains. In The Origins of Virtue, Matt Ridley debunks this idea, writing that environmental protection was damaged primarily by meddlesome governments who didn’t understand how local community-arrangements already protected the environment.
The Origins of Virtue was released in 1996
The rehabilitation of coercion by the state it was a distinctly Hobbesian victory. [The philosopher Thomas] Hobbes had argued in favour of a supreme sovereign power as the only way to enforce cooperation among its subjects. ‘And covenants,’ he wrote, ‘without the sword are but words, and of no strength to secure a man at all.’ The only solution to tragedies of the commons, real or imagined, was seen in the 1970s as nationalization by the state. All across the world, communal ownership became an excuse for aggrandizement by governments. As one economist put it in 1973, shedding walrus tears, ‘If we avoid the tragedy of the commons, it willonly be by recourse to the tragic necessity of Leviathan.’
This recipe was an unmitigated disaster. Leviathan creates tragedies of the commons where none were before. Consider the case of wildlife in Africa. All across the continent countries nationalized their game during colonial regimes and after independence in the 1960s and 1970s, arguing that it was the only way to prevent ‘poachers’ wiping out this commonly held resource. The result was that peasants now faced competition and damage from government-owned elephants and buffalo, and had no longer any incentive to look after the animals as a source of meat or revenue. ‘The African farmer’s enmity towards elephants is as visceral as Western mawkishness is passionate,’ said the head of the Kenya Wildlife Service, David Western. The decline of African elephants, rhinos and other animals is a tragedy of the commons, created by nationalization. This is proved by the fact that it has been spectacularly reversed wherever title to wildlife has been re-privatised to communities, such as in the Campfire programme of Zimbabwe in which sport hunters bid to buy the rights to kill game from committees of villagers. The villagers rapidly change their attitudes to the now valuable game animals on their land. The acreage of private land devoted to wildlife has increased from 17,000 to 30,000 square kilometres since Zimbabwe granted title to landowners.
Last week in California, a federal district court invalidated the state’s Low Carbon Fuel Standard, a requirement that upstream producers of transportation fuel (i.e., refineries and distributors) reduce the carbon intensity of gasoline sold in the state. Former Governor Arnold Schwarzenegger imposed the LCFS in 2007, by executive order. The regulation accounts for 10% of greenhouse gas emissions reductions California is relying on to achieve the climate change goals of the state’s 2006 Global Warming Solutions Act, which Schwarzenegger championed.
Judge Lawrence O’Neill determined that the LCFS violated the Constitution’s Commerce Clause, because it effectively regulated interstate commerce to the detriment of some states. The plaintiffs were farmers and ethanol groups, who stood to lose market-share to Brazilian ethanol producers due to the fact that Brazil’s sugar-cane ethanol is less carbon intensive than American corn ethanol. Judge O’Neil allowed for the State to immediately appeal to the 9th federal Circuit Court of Appeals.
A day after the court’s decision, my colleague Myron Ebell was invited on Fox Business’s Cavuto show to discuss the issue. Video of his appearance is below.
There’s a big lie making the rounds that EPA’s ultra-expensive new mercury regulation is worth the cost ($10 billion annually) because it will protect fetuses from developmental disorders.
EPA Administrator Lisa Jackson is the most prominent perpetrator of the mercury lie. Recently, she gave a pep talk to a group of collegian environmental activists trying to shut down campus coal fired power plants, during which she said:
“It’s so important that your voices be heard, that campuses that are supposed to be teaching people aren’t meanwhile polluting the surrounding community with mercury and costing the children a few IQ points because of the need to generate power. It’s simply not fair.”
Over at Think Progress Green, Brad Johnson does his part to spread mercury disinformation, by pooh-poohing Rep. Ed Whitfield (R-Kentucky) for having claimed (correctly) that the mercury rule won’t have any benefit for babies and pregnant women. According to Johnson,
“The glimmer of fact in Whitfield’s claims is that the health costs of mercury poisoning of our nation’s children over decades of unlimited coal pollution are difficult to quantify. Mercury poisoning is rarely fatal and hard to detect, but causes undeniable, insidious developmental harm to fetuses and babies.”
Naturally, environmentalist special interests are the worst propagators of this mercury mendacity. The day that EPA Administrator announced the final mercury rule, Sierra Club launched a television advertisement depicting a little girl learning to ride a bike, while a voiceover states:
“When this little girl grows up her world will have significantly less mercury pollution because President Obama and the EPA stood up against polluters and established the first-ever clean air standards. This action means that our air, water, and food will be safer from mercury pollution and heavy metals generated by coal-fired power plants. Like you, President Obama understands that reducing toxic mercury pollution increases the possibilities to dream big.”
Global atmospheric mercury might or might not be a problem—I don’t know. But I do know that mercury emissions from U.S. coal fired plants pose a negligible danger to fetuses. And I know this because EPA told me so.
In my (only slightly) satirical column for the Washington Examiner today, I take aim at the hypocrisy and futility of the street-harassment/eco-activism that many of us encounter so often as we try and get to and from work. The question, really, is this: Do green activists do any good at all, or are they merely part of the (alleged) problem? From the column:
The question of whether the green energy industry can fight its own battles within the competitive energy market was answered Wednesday with the release of U.S. EPA’s Utility MACT rule. The unsurprising answer is no, it cannot. This rule, dressed with the façade of an earth-friendly health-protecting mandate, is a regulation intended to fade out the coal industry—one of the renewable industry’s strongest competitors.
The Utility MACT rule, announced by EPA Chief Lisa Jackson on December 21, 2011 at the choice location of the Children’s National Medical Center in D.C., has two rules for coal-fired power plants. The first rule curbs air pollution in states downwind from “dirty” coal-fired power plants. The second would set the first standards for mercury and other pollutants from power plant smokestacks, requiring plants to install “maximum achievable control technology” to reduce emissions of pollutants. EPA estimates this rule will cost $9.6 billion while the industry approximates the cost of $100 billion; between the two, this rule is one of the most expensive regulations to date. An analysis done by AP stated that these rules eliminate more than 8 percent of coal-fired energy nationwide. AP also found that more than 32 mostly coal-fired power plants in a dozen states will be forced to shut down and an additional 36 might have to close because of new federal air pollution regulations; together, those plants produce enough electricity for more than 22 million households.
On the first day of 2012, the New York Times published an editorial, “Where the Real Jobs Are,” that is uniformly backwards. If the federal government did the exact opposite of every recommendation made by the New York Times editorial board, Americans would benefit the most.
According to the Times, President Barack Obama should reject the shovel-ready Keystone XL Pipeline, because it would carry “conventional” oil from Alberta to the Gulf Coast. The editorial board then suggests that “real” jobs are those in the sector of the economy responsible for the production of “alternative” energy, like wind and solar power. Instead of allowing the private sector to create 6,000 (presumably fake) jobs by permitting the Keystone XL, the Times argues that the President should “lay out the case that industry, with government help, can create hundreds of thousands of clean energy jobs.” In the Times’s mind, Europe has shown the way:
“Europe has encouraged the commercial development of carbon-reducing technologies with a robust mix of direct government investment and tax breaks, loans and laws that cap or tax greenhouse gas emissions. This country needs a comparably broad strategy that will create a pathway from the fossil fuels of today to the greener fuels of tomorrow.”
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