Marlo Lewis

Ethanol Mandate Waiver: Decks Stacked Against Petitioners

by Marlo Lewis on September 10, 2012

in Blog, Features

Post image for Ethanol Mandate Waiver: Decks Stacked Against Petitioners

The Governors of Georgia, Texas, Arkansas, Delaware, Maryland, New Mexico, and North Carolina have petitioned EPA Administrator Lisa Jackson to waive the mandatory ethanol blending requirements established by the Renewable Fuel Standard (RFS). The petitioners hope thereby to lower and stabilize corn prices, which recently hit record highs as the worst drought in 50 years destroyed one-sixth of the U.S. corn crop. Corn is the principal feedstock used in ethanol production.

Arkansas Gov. Mike Bebe’s letter to Administrator Jackson concisely makes the case for regulatory relief:

Virtually all of Arkansas is suffering from severe, extreme, or exceptional drought conditions. The declining outlook for this year’s corn crop and accelerating prices for corn and other grains are having a severe economic impact on the State, particularly on our poultry and cattle sectors. While the drought may have triggered the price spike in corn, an underlying cause is the federal policy mandating ever-increasing amounts corn for fuel. Because of this policy, ethanol production now consumes approximately 40 percent of the U.S. corn crop, and the cost of corn for use in food production has increased by 193 percent since 2005 [the year before the RFS took effect]. Put simply, ethanol policies have created significantly higher corn prices, tighter supplies, and increased volatility.

Agriculture is the backbone of Arkansas’s economy, accounting for nearly one-quarter of our economic activity. Broilers, turkeys, and cattle — sectors particularly vulnerable to this corn crisis — represent nearly half of Arkansas’s farm marketing receipts. Arkansas poultry operators are trying to cope with grain cost increases and cattle familes are struggling to feed their herds.

Section 211(o)(7) of the Clean Air Act (CAA) authorizes the EPA to waive all or part of the RFS blending targets for one year if the Administrator determines, after public notice and an opportunity for public comment, that implementation of those requirements would “severely harm” the economy of a State, a region, or the United States. Only once before has a governor requested an RFS waiver. When corn prices soared in 2008, Gov. Rick Perry of Texas requested that the EPA waive 50% of the mandate for the production of corn ethanol. Perry, writing in April 2008, noted that corn prices were up 138% globally since 2005. He estimated that rising corn prices had imposed a net loss on the State’s economy of $1.17 billion in 2007 and potentially could impose a net loss of $3.59 billion in 2008. At particular risk were the family ranches that made up two-thirds of State’s 149,000 cattle producers. Bush EPA Administrator Stephen Johnson rejected Perry’s petition in August 2008.

In the EPA’s Request for Comment on the 2012 waiver petitions, the agency indicates it will use the same “analytical approach” and “legal interpretation” on the basis of which Johnson denied Perry’s request in 2008. This means the regulatory decks are stacked against the petitioners. As the EPA reads the statute, CAA Section 211(o)(7) establishes a burden of proof that is nearly impossible for petitioners to meet. No matter how high corn prices get, or how serious the associated economic harm, the EPA will have ready-made excuses not to waive the corn-ethanol blending requirements. [click to continue…]

Stern Review Not Fit to Guide U.K. Climate Policy, Report Finds

by Marlo Lewis on September 4, 2012

in Features

Post image for Stern Review Not Fit to Guide U.K. Climate Policy, Report Finds

The Global Warming Policy Foundation (GWPF) has just published The Failings of the Stern Review of the Economics of Climate Change. The  2006 Stern Review — named for Sir Nicholas Stern, head of the UK Government’s Economic Service under Prime Minister Tony Blair – is arguably the most pessimistic official assessment ever of the economic damages of global warming. The Stern Review famously argued that the “costs of inaction” on climate change hugely outweigh the costs of greenhouse gas mitigation, claiming that, ”If we don’t act, the overall costs and risks of climate change will be equivalent to losing at least 5% of global GDP each year now and forever.”

Influenced by the Stern Review, the UK Government adopted a set of climate policies that cost £17,000 per household, according to the GWPF report, prepared by the Rt. Hon. Peter Lilley MP. Since the UK’s total annual carbon dioxide (CO2) emissions are less than the increase in China’s CO2 emissions in a single year, the UK Government’s climate program is all pain for no gain. It is time for the UK Government to review the Stern Review, Lilley contends.

The GWPF report is 100 pages long, but there is a helpful executive summary and a hard-hitting foreword by leading climate economist Richard Toll. The following excerpts from Toll’s contribution should be sufficient to entice even the most jaded climate wonk to read the report:

The publication of the Stern Review of the Economics of Climate Change was a PR exercise that was unprecedented in economics. Sir Nicholas, now Lord Stern, was portrayed as an expert even though he had never published before on the economics of energy, environment or climate.

Honest policy analysts show results for a range of alternative discount rates. The Stern Review uses a single discount rate. It corresponds to an extreme position in the literature and it deviates from the official discount rate of HM Treasury. Nick Stern is, of course, free to use whatever discount rate he wants in his private life. Professor Sir Partha Dasgupta of Cambridge University has found that Stern should save 97.5% of his income, were Stern to follow the advice in the Stern Review. Taking such an extreme position in public policy is odd.

Most economic studies conclude that it is best to start with modest emission reduction, and accelerate the stringency of climate policy over time. For that, public policy will need to pull into the same direction over 20 or more electoral cycles. If the case for climate policy is exaggerated, the backlash will come, sooner or later. The Stern Review was a tactical masterstroke, but it will likely prove to be a strategic blunder. Its academic value is zero.

In a related post, Lilley provides a condensed summary of his report. “Stern,” he writes, ”reaches conclusions far removed from those of most environmental economists by combining statistical sophistry and verbal virtuosity. For example:” [click to continue…]

Should We Fear the Methane Time Bomb (Part Deux)?

by Marlo Lewis on August 31, 2012

in Blog, Features

Post image for Should We Fear the Methane Time Bomb (Part Deux)?

Climate alarmists have long warned that warming of the Arctic could melt frozen marine and permafrost sediments, releasing methane trapped in peat bogs and ice crystals (clathrate hydrates, see photo above). Methane is a potent greenhouse gas that packs 21 times the global warming punch as CO2 over a 100-year time span and more than 100 times the CO2-warming effect over a 20-year period.

So the fear is that methane emissions from the thawing Arctic will accelerate global warming, which in turn will melt more clathrates and methane-bearing sediments, which will produce still more warming, in a vicious circle of climate destabilization. In a previous post, I offered a skeptical perspective on this doomsday scenario.

This week the journal Nature published a study raising similar concerns about the potential for significant releases of methane from the Antarctic ice sheets. The study’s 14 authors, led by Jemma Wadham of the University of Bristol in the UK, estimate that about 21,000 petagrams (gigatons) of organic carbon (OC) are buried in sedimentary basins under the East and West Antarctic ice sheets – more than 10 times the estimated magnitude of OC stocks in northern permafrost regions. Microbial production of methane from OC (a process known as methanogenesis) is common across many cold subsurface environments, and may have been at work for millions of years beneath the Antarctic Ice Sheets.  [click to continue…]

Pickens Plan – Well and Truly Dead?

by Marlo Lewis on August 29, 2012

in Features

Post image for Pickens Plan – Well and Truly Dead?

At a luncheon hosted by Politico at the GOP convention in Tampa today, T. Boone Pickens said truck fleets will switch from diesel to natural gas without Congress approving the NAT GAS Act, legislation offering generous tax credits for the purchase of natural gas trucks (up to $64,000 per vehicle) and installation of natural gas fueling infrastructure. Pickens reportedly spent about $100 million over the past five years promoting his energy agenda, commonly known as the Pickens Plan.

Congress declined to pass either the NAT GAS Act or an earlier iteration of the Pickens Plan that would have required 20% of the nation’s electricity to come from wind, thus supposedly freeing up natural gas to be used to fuel both trucks and passenger cars.

Critics argued that if switching to natural gas vehicles makes commercial sense, private enterprise will bring about the transformation without Washington trying to pick energy market winners and losers. Pickens is now talking the talk. Politico‘s Darren Goode reports:

“You don’t have to have a tax credit; it’s going to happen,” he [Pickens] said. The choices to run 18-wheelers, he said, are between natural gas and diesel — and natural gas is “$2 a gallon cheaper.”

And Pickens strongly suggested that he doesn’t have any plans to try to push his plan anymore in the nation’s Capital.

“I will not go back to Washington again unless it’s for a social event,” he said.

The billionaire and former oil baron also lamented that while his plan initially promoted wind energy, that hasn’t worked out so well.

“I’ve lost my ass” to wind-energy investments, he conceded.

Heat Waves, Droughts, Floods — We Didn’t Listen!

by Marlo Lewis on August 23, 2012

in Features

Post image for Heat Waves, Droughts, Floods — We Didn’t Listen!

The hilarious South Park episode “Two Days Before the Day After Tomorrow” opens with Eric Cartman and Stan Marsh playing in a motor boat that Cartman falsely claims belongs to his uncle. Cartman persuades Stan to drive the boat. Not knowing how, Stan crashes the boat into the world’s largest beaver dam, flooding the town of Beaverton.

Rather than get help, Cartman and Stan decide to tell no one and pretend they were playing at Eric’s house all afternoon. The flood leads to wild speculation not only in South Park but also in the national media and the scientific community. Stan’s father Randy is a geologist. He and his colleagues determine that global warming caused the Beaverton flood. Worse, they calculate that global warming will strike worldwide “two days before the day after tomorrow.” Randy exclaims: “Oh my God — that’s today!” There is panic in the streets.

Echoing the sermon at the end of the 2004 Sci-Fi disaster film, The Day After Tomorrow, Randy laments: “Stan, I’m afraid us adults just let you children down. We didn’t take care of our earth, and now you’ve inherited our problems. We didn’t listen!” To watch Randy’s mea culpa on YouTube, click here.

We’ve been hearing a lot from Randy’s real-world counterparts of late, which is why in recent posts, I presented evidence that climate change was not the principal factor behind the 2003 European heat wave, the 2010 Russian heat wave, the 2011 Texas drought, or the ongong Midwest drought.

What about floods? Google “global warming” and “floods,” and you’ll get 7.2 million results. Given all that ‘evidence,’ you may surprised that a new scientific study finds no correlation between rising global mean carbon dioxide concentrations (GMCO2) and flooding in the U.S.

[click to continue…]

Inside the Sausage Factory: The Obama Administration’s Auto Regulations

by Marlo Lewis on August 22, 2012

in Features

Post image for Inside the Sausage Factory: The Obama Administration’s Auto Regulations

Earlier this month, the House Oversight and Government Reform Committee issued a staff report on the Obama Administration’s fuel economy/greenhouse gas (GHG) regulatory program. The report, A Dismissal of Safety, Choice, and Cost, is the product of a “multi-year Committee investigation” that includes three hearings, a transcribed interview of EPA Assistant Administrator Gina McCarthy, and a review of more than 15,000 documents obtained by the Committee from the EPA, the National Highway Traffic Safety Administration (NHTSA), the California Air Resources Board (CARB), and 15 automobile manufacturers.

Some key findings:

  • The Administration performed an end-run around the law and ran a White House-based political negotiation, led by “czars” who marginalized NHTSA, the federal agency charged in statute with setting fuel economy standards.
  • Contrary to the statutory scheme Congress created, the EPA became the lead agency in fuel economy regulation and NHTSA was sidelined. Contrary to Congress’s preemption of State laws or regulations “related to” fuel economy, CARB became a “major player” and an “aggressive participant in the process,” allowing unelected state regulators in Sacramento to set national policy outside the federal rulemaking process.
  • The Administration violated the spirit – and possibly the letter – of the Administrative Procedure Act, Presidential Records Act, and Federal Advisory Committee Act by negotiating agreements on both the Model Year (MY) 2012-2016 and MY 2017-2025 standards behind closed doors with only a select group of stakeholders.
  • The new fuel-economy/GHG standards will add thousands of dollars to the cost of new vehicles. Consumers are likely to incur net financial losses unless annual gasoline prices reach $5-$6 per gallon.
  • Compliance with the new standards will require mass reductions that will, in turn, compromise vehicle safety. EPA and CARB officials mocked and belittled safety concerns raised by NHTSA.

In a law journal article and regulatory comment letter, I also make the case that the administration’s fuel-economy agenda trashes the separation of powers and administrative procedures. But the Committee’s report provides the first, detailed behind-the-scenes chronology of Team Obama’s fuel economy machinations, confirming what other critics suspected but could not document.

Some secrets of the sausage factory, though, may never come to light: “Despite multiple requests, the Executive Office of the President refused to provide any information on its involvement in developing the fuel economy and GHG emissions standards.”

[click to continue…]

Court Vacates EPA Cross State Air Pollution Rule

by Marlo Lewis on August 21, 2012

in Features

Post image for Court Vacates EPA Cross State Air Pollution Rule

Today, the D.C. Circuit Court of Appeals vacated the EPA’s Cross State Air Pollution Rule (CSAPR), also known as the Transport Rule. The Rule’s purpose is to implement the Clean Air Act’s ‘good neighbor policy,’ which prohibits upwind states from contributing significantly to downwind states’ non-attainment with National Ambient Air Quality Standards (NAAQS).

The Court vacated the CSAPR because . . . (drum roll, please) . . . the EPA regulated beyond its statutory authority. Dog bites man.

From the decision, filed for the Court by Judge Brett Kavanaugh:

Absent a claim of constitutional authority (and there is none here), executive agencies may exercise only the authority conferred by statute, and agencies may not transgress statutory limits on that authority.

Here, EPA’s Transport Rule exceeds the agency’s statutory authority in two independent respects. First, the statutory text grants EPA authority to require upwind States to reduce only their own significant contributions to a downwind State’s nonattainment. But under the Transport Rule, upwind States may be required to reduce emissions by more than their own significant contributions to a downwind State’s nonattainment. EPA has used the good neighbor provision to impose massive emissions reduction requirements on upwind States without regard to the limits imposed by the statutory text. Whatever its merits as a policy matter, EPA’s Transport Rule violates the statute. Second, the Clean Air Act affords States the initial opportunity to implement reductions required by EPA under the good neighbor provision. But here, when EPA quantified States’ good neighbor obligations, it did not allow the States the initial opportunity to implement the required reductions with respect to sources within their borders. Instead, EPA quantified States’ good neighbor obligations and simultaneously set forth EPA-designed Federal Implementation Plans, or FIPs, to implement those obligations at the State level. By doing so, EPA departed from its consistent prior approach to implementing the good neighbor provision and violated the Act.

For each of those two independent reasons, EPA’s Transport Rule violates federal law. Therefore, the Rule must be vacated.

 

John Christy on Summer Heat and James Hansen’s PNAS Study

by Marlo Lewis on August 20, 2012

in Blog, Features

Post image for John Christy on Summer Heat and James Hansen’s PNAS Study

In a recent study published in Procedings of the National Academy of Sciences (PNAS), NASA scientist James Hansen and two colleagues find that whereas “extremely hot” summer weather ”practically did not exist” during 1951-1980, such weather affected between 4% and 13% of the Northern Hemisphere land area during 2006-2011. The researchers infer that human-caused global warming is “loading” the “climate dice” towards extreme heat anomalies. They conclude with a “high degree of confidence” that the 2003 European heat wave, the 2010 Russian heat wave, and the 2011 Texas-Oklahoma drought were a “consequence of global warming” and have (as Hansen put it in a recent op-ed) ”virtually no explanation other than climate change.”

In a recent post, I reviewed studies finding that the aforementioned anomalies were chiefly due to natural variability. In another post, I summarized an analysis by Patrick Michaels and Chip Knappenberger, who conclude that “the 2012 drought conditions, and every other [U.S.] drought that has come before, is the result of natural processes, not human greenhouse gas emissions.”

But what about the very hot weather afflicting much of the U.S. this summer? Greenhouse gas concentrations keep rising, heat spells are bound to become more frequent and severe as the world warms, and the National Oceanic and Atmospheric Administration (NOAA) reports that July 2012 was the hottest July ever in the U.S. instrumental record. Isn’t this summer what greenhouse warming “looks like“? What else could it be?

University of Alabama in Huntsville (UAH) climatologist John Christy addressed these questions last week in a two-part column. In Part 1, Christy argues that U.S. daily mean temperature (TMean) data, on which NOAA based its report, ”do not represent the deep atmosphere where the enhanced greenhouse effect should be detected, so making claims about causes is unwise.” A better measure of the greenhouse effect is daily maximum temperature (TMax), and TMax records set in the 1930s remain unbroken. In Part 2, Christy argues that Hansen’s 10% estimate of the portion of land affected by extreme heat during 2006-2011 shrinks down to 2.9% when anomalies are measured against a longer, more representative climate baseline.  [click to continue…]

U.S. Court of Appeals: Food, Fuel Groups not Injured by EPA’s Approval of E15, Hence Lack Standing to Sue — Huh?

by Marlo Lewis on August 17, 2012

in Blog, Features

Post image for U.S. Court of Appeals: Food, Fuel Groups not Injured by EPA’s Approval of E15, Hence Lack Standing to Sue — Huh?

Today, the D.C. Circuit Court of Appeals found in a 2-1 decision that automakers, petroleum refiners, and food producers lack standing to challenge the Environmental Protection Agency’s (EPA’s) approval of E15 — a blend of gasoline and 15% ethanol — for motor vehicles manufactured after 2000.

Petitioners argued that the EPA acted illegally. Section 211(f) of the Clean Air Act (CAA) prohibits the introduction of new fuels and additives into the U.S. motor fuel supply unless the manufacturer demonstrates that such fuels or additives “will not cause or contribute to a failure of any emission control device or system” of any motor vehicle, motor vehicle engine, nonroad vehicle, or nonroad engine manufactured after model year 1974. By the EPA’s own admission, E15 can contribute to emission failures in vehicles manufactured between 1975 and 2000. Petitioners argued that CAA 211(f) gives the EPA no authority to grant a “partial waiver” for the sale of new fuels or additives to a subset of vehicles (e.g., model years 2001 and later).

Chief Justice David Sentelle and Judge David Tatel held that petitioners lack standing to sue. According to Sentelle and Tatel, petitioners could not show that the EPA’s approval of E15 would likely cause a ‘concrete’ and ‘imminent’ injury to any automaker, refiner, or food producer.

I’ll grant that the automakers’ asserted injury may be ‘speculative’ or ‘conjectural.’ However, it is hard to fathom how the EPA’s approval of E15 would not impose substantial costs on both petroleum refiners and food producers. The switch from E10 to E15 means a 50% increase in the quantity of ethanol blended into the nation’s motor fuel supply, potentially increasing ethanol sales from 14 billion gallons a year to 21 billion gallons. Since nearly all U.S. ethanol today comes from corn, the switch to E15 could substantially increase demand for corn, corn prices, and the quantity of corn diverted from feed and food production to motor fuel production.

Sentelle and Tatal argued that refiners and food producers are not injured because the EPA is merely giving refiners the ‘option’ to blend and sell E15, not forcing them to do so. But this is a distinction without a difference. As the justices acknowledge, the Renewable Fuel Standard (RFS) will soon require refiners to sell more ethanol than can be blended as E10. Thus, if the EPA waiver is upheld, refiners will have no real choice but to blend and sell E15, and this will impose substantial, predictable costs on both refiners and food producers. Their injury is concrete and imminent. The Court, therefore, should have reviewed the case on the merits and struck down the waiver as exceeding the EPA’s authority under CAA Section 211.

Judge Brett Kavanaugh’s dissent is so powerful and convincing that I will be surprised if the case is not appealed and overturned. Excerpts from Kavanaugh’s dissent follow.   [click to continue…]

Hansen on Extreme Weather — Pat and Chip Respond

by Marlo Lewis on August 15, 2012

in Features

Post image for Hansen on Extreme Weather — Pat and Chip Respond

Last week, I posted a commentary on NASA scientist James Hansen’s study and op-ed, which attribute recent extreme weather to global climate change. In the op-ed, Hansen stated:

The deadly European heat wave of 2003, the fiery Russian heat wave of 2010 and catastrophic droughts in Texas and Oklahoma last year can each be attributed to climate change. And once the data are gathered in a few weeks’ time, it’s likely that the same will be true for the extremely hot summer the United States is suffering through right now.

My commentary concluded: “Hansen’s sweeping assertion that global warming is the principal cause of the European and Russian heat waves, and the Texas-Oklahoma drought, is not supported by event-specific analysis and is implausible in light of previous research.”

Although Hansen does not explicitly attribute the ongoing U.S. drought to global warming, he does blame global warming for both the 2011 Texas-Oklahoma drought and the current summer heat. And in his study, Hansen states: “With the temperature amplified by global warming and ubiquitous surface heating from elevated greenhouse gas amounts, extreme drought conditions can develop.”

This week on World Climate Report, Pat Michaels and Chip Knappenberger argue that the current U.S. drought “is driven by natural variability not global warming.” Their post (“Hansen Is Wrong“) is concise and layman-friendly. Here I offer an even briefer summary.

A standard measure of drought in the U.S. is the Palmer Drought Severity Index (PDSI), which measures the combined effects of temperature (hotter weather = more soil evaporation) and precipitation (more rainfall = more soil moisture). “The more positive the PDSI values, the wetter conditions are, the more negative the PDSI values, the drier things are.” The PDSI for the past 117 years (1895-2011) shows a small non-significant positive trend (i.e. towards wetter conditions). There is no greenhouse warming signal in this data.

[click to continue…]

← Previous Entries

Next Entries →