Features

Ethanol Litigation: Another Powerful Dissent by Judge Kavanaugh

by Marlo Lewis on January 17, 2013

in Blog, Features

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On Tuesday, the D.C. Circuit Court of Appeals denied by 7-1 a petition for a full-court re-hearing of its 2-1 decision last summer to dismiss litigation challenging EPA’s approval of the sale of E15 at retail motor fuel pumps. E15 is a blend of 85% gasoline and 15% ethanol.

In both decisions, Judge Brett Kavanaugh was the sole dissenter, and both times he trounces the majority on the facts and statutory logic.

In a previous post, I reviewed Kavanaugh’s dissent in the August 2012 decision. Herewith a brief recap:

  • The 2-1 majority held that petitioners – refiners and livestock producers — would not be injured by the EPA’s grant of a waiver authorizing the sale of E15 and thus lack standing to challenge the agency. The majority somehow missed the obvious.
  • There being no commercial substitute for ethanol to meet the ever-increasing production quota established by the Renewable Fuel Standard (RFS), EPA approval of E15 is a de facto mandate on refiners to increase the blend from E10 to E15 — a roughly 50% increase from about 14 billion gallons to 21 billion gallons annually. That will necessarily impose a cost on refiners. 
  • In addition, because virtually all U.S. ethanol is made from corn, approving E15 will increase the demand for and price of corn, imposing a cost on livestock producers, who purchase billions of bushels annually to feed their hogs, cattle, and poultry.
  • Clearly, EPA approval of E15 injures both petitioner groups, so the Court should have reviewed the petitions on the merits.
  • Section 211(f) of the Clean Air Act (CAA) prohibits the EPA from approving the sale of any fuel additive that causes or contributes to the failure of emission control systems in any vehicle manufactured after 1974. 
  • By the EPA’s own admission, E15 can contribute to emission control failures in vehicles manufactured during model years 1975 through 2000.
  • Therefore, the EPA lacks authority to approve the sale of E15.

Kavanaugh’s dissent in Tuesday’s decision reiterates those points but also adds some illuminating refinements. [click to continue…]

One Million Fewer Jobs Created by 2016 under ‘Modest’ Carbon Tax

by Marlo Lewis on January 14, 2013

in Features

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Heritage Foundation economists David Kreutzer and Nicolas Loris have posted an assessment of the economic impacts of a carbon tax that starts out at $25 per ton and increases by 5% annually (after adjusting for inflation). Rather than use industry data or assumptions, they compare two policy scenarios (“side cases”) from the U.S. Energy Information Administration’s (EIA) Annual Energy Outlook 2012.

Specifically, Kreutzer and Loris compare projected household income, utility bills, gasoline prices, and job creation in the $25 per ton carbon tax side case and the no-greenhouse-gas-concern side case, a scenario in which energy investors face no risk of a carbon tax or greenhouse gas (GHG) regulation.  

Here’s what they found. A ‘modest’ carbon tax, as described above, would:

  • Cut the income of a family of four by $1,900 per year in 2016 and lead to average losses of $1,400 per year through 2035;
  • Raise the family-of-four energy bill by more than $500 per year (not counting the cost of gasoline);
  • Cause gasoline prices to increase by up to $0.50 gallon, or by 10 percent on an average gallon price; and
  • Lead to an aggregate loss of more than 1 million jobs by 2016 alone. [click to continue…]

How Many ‘Wedges’ Does It Take to Solve the Climate ‘Problem’?

by Marlo Lewis on January 11, 2013

in Blog, Features

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In An Inconvenient Truth (pp. 280-281), Al Gore enthused about a Science magazine study by Princeton economists Robert Socolow and Stephen Pacala. The study concluded that, “Humanity already possesses the fundamental scientific, technical, and industrial know how to solve the carbon and climate problems for the next half century.” Gore claimed the policies Socolow and Pacala recommend, “all of which are based on already-existing, affordable technologies,” could reduce emissions below 1970s levels.

But Gore could not know the solutions are “affordable,” because the authors did not attempt to estimate costs. The study basically shows that if political leaders can somehow coerce everybody to use less energy and adopt low- or zero-carbon energy technologies regardless of cost, they can significantly reduce emissions by 2054. We needed Princeton professors to tell us that?

If An Inconvenient Truth were a balanced presentation rather than a CGI-embellished lawyer’s brief, Gore would have mentioned that Socolow and Pacala’s (S&P) study was a response to an earlier analysis, also published in Science, by New York University Prof. Martin Hoffert and 17 colleagues.

Hoffert et al. found that all existing energy technologies “have severe deficiencies that limit their ability to stabilize global climate.” They specificially took issue with the UN IPCC’s claim that “known technological options” could stabilize atmospheric carbon dioxide (CO2) levels at 550 parts per million (ppm) or even 450 ppm over the next 100 years. Noting that world energy demand could triple by 2050, they found that zero-carbon technologies that can produce 100 to 300% of present world power consumption “do not exist operationally or as pilot plants.” Bottom line: “CO2 is a combustion byproduct vital to how civilization is powered; it cannot be regulated away.” They concluded that it is not possible to stabilize atmospheric CO2 concentrations and meet global energy needs “without drastic technological breakthroughs.”

I review this ancient history because Environmental Research Letters just published a study ‘updating’ (i.e. rebutting) the S&P analysis. The lead author is UC Irvine Prof. Steven Davis. One of three other co-authors is Martin Hoffert.

S&P estimated that seven ”stabilization wedges” could limit atmospheric CO2 concentrations to 500 ppm by 2054. The Davis team estimates it will take 19 and possibly 31 wedges to solve the climate ‘problem.’ In other words, the challenge is much more difficult than S&P believed.

But what, you may be wondering, is a “stabilization wedge”?

[click to continue…]

Will the Supreme Court Review EPA’s Greenhouse Gas Regulations? Part II

by Marlo Lewis on January 8, 2013

in Features

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In Coalition for Responsible Regulation v. EPA, petitioners — a coalition of industry groups, states, and non-profit organizations — sought to overturn the EPA’s endangerment, tailpipe, triggering, and tailoring rules for greenhouse gases (GHGs). In June of last year, a three-judge panel of the D.C. Circuit Court of Appeals ruled in favor of the EPA, upholding the four GHG rules. In August, coalition members petitioned for an en banc (full court) rehearing of the case. On Dec. 20, 2012 the D.C. Circuit Court of Appeals rejected the petitions by 5-2.

However, given the importance of the issues and the strength of the two dissenting opinions, the case may go to the Supreme Court. Last week, I reviewed Judge Janice Rogers Brown’s dissenting opinion. Today, I review Judge Brett Kavanaugh’s dissent.

Judge Brown chiefly addresses the “interpretative shortcomings” of the Mass. v. EPA Supreme Court decision, which authorized the EPA to regulate GHGs via the Clean Air Act (CAA). Kavanaugh directs his fire at the opinion, shared by the EPA and the five-judge majority, that the CAA’s Prevention of Significant Deterioration (PSD) preconstruction permitting program applies to GHGs, and at the agency’s attempt to “tailor” away the consequent “absurd results” by rewriting the statute. [click to continue…]

Will the Supreme Court Review EPA’s Greenhouse Gas Regulations?

by Marlo Lewis on January 4, 2013

in Blog, Features

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Powerful dissenting opinions can sometimes persuade a higher court to review a lower court’s ruling. Massachusetts v. EPA (2007), the Supreme Court decision empowering the EPA to act as a super legislature and ‘enact’ climate policy, is a prime example.

In 2005, the D.C. Circuit Court of Appeals held that the Bush administration EPA properly exercised its discretion when it denied a petition by eco-litigation groups to regulate greenhouse gas (GHG) emissions from new motor vehicles under §202 of the Clean Air Act (CAA). I remember feeling relieved but disappointed. The 2-1 majority ducked the central issue, namely, whether the CAA authorizes the EPA to regulate GHGs as climate change agents. In contrast, Judge David Tatel’s dissent made a strong argument that the EPA does have the power to regulate GHGs and, consequently, has a duty to determine whether GHG emissions endanger public health or welfare. Tatel’s opinion was a key factor persuading the Supreme Court to hear the case.

The Court in Massachusetts ruled in favor of petitioners, setting the stage for the EPA’s ongoing, ever-expanding regulation of GHG emissions from both mobile and stationary sources.

The EPA’s greenhouse regulatory surge, however, is not yet ‘settled law.’ Recent strong dissenting opinions by two D.C. Circuit Court of Appeals judges may persuade the Supreme Court to review one or more of the agency’s GHG rules — or even reassess its ruling in Mass. v. EPA. [click to continue…]

CO2 Emissions, Life Expectancy, Per Capita GDP: The Real Hockey Stick

by Marlo Lewis on December 27, 2012

in Features

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That fossil fuels are bad for people and the planet is a cardinal tenet of both mainstream and radical environmentalism. Cato Institute scholar Indur Goklany offers a dramatically different assessment in Humanity Unbound: How Fossil Fuels Saved Humanity from Nature and Nature from Humanity.

Global average life expectancy (the best single indicator of health) hardly changed through most of human history, averaging 20-25 years during 1 A.D. to 1750. Similarly, global per capita output (the best indicator of material welfare) was equivalent to an estimated $470 in 1 A.D., even lower – $400 — in 1000 A.D., and only $640 in 1750. Through most of human history, the vast majority of people were “mired in poverty.” Thomas Malthus’s gloomy prediction that economic growth would only lead to overpopulation, famine, and death seemed to bespeak the wisdom of the ages.

However, the industrial revolution and the associated advances of science and technology freed humanity from its Malthusean trap. Goklany summarizes:

From 1750 to 2009, global life expectancy more than doubled, from 26 years to 69 years; global population increased 8-fold, from 760 million to 6.8 billion; and incomes increased 11-fold, from $640 to $7,300. Never before had the indicators of the success of the human species advanced as rapidly as in the past quarter millennium.

Fossil fuels are the chief energy source of modern civilization. Accordingly, global carbon dioxide (CO2) emissions have increased rapidly along with life expectancy and per capita income. Goklany illustrates these trends with a graph that bears a striking resemblance to a hocky stick.

[click to continue…]

PTC: Costly Climate Policy Dud

by Marlo Lewis on December 20, 2012

in Blog, Features

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The wind energy production tax credit (PTC) expires at the stroke of midnight, Dec. 31, unless Congress votes to renew the tax break. A one-year extension would add an estimated $12.1 billion to deficit spending over 10 years. A six-year extension, advocated by the wind industry, could add $50 billion.

The fiscal cliff looms and the national debt already exceeds GDP, but if Congress cared more about the general interest of taxpayers than about the special interests of campaign contributors, the nation would not be sliding towards insolvency.

Whether Congress should renew the PTC or let it expire is the topic of this week’s National Journal Energy Experts Blog. Twenty wonks weigh in, including your humble servant. I heartily recommend the contributions by Sen. Lamar Alexander (R.-Tenn.), Craig Rucker, Phil Kerpin, Benjamin Zycher, Thomas Pyle, James Valvo, and David Banks.

My contribution addresses the environmental side of the debate, in particular the claim that recent extreme weather events demonstrate “just how badly our nation needs to take advantage of our vast wind energy potential,” as one contributor put it.

Below is a lightly edited version of my comment.

* * *

Of all the lame arguments used to sell Americans on the proposition that wind power, an industry propped up by Soviet-style production quota in 29 states and numerous other policy privileges, deserves another renewal of the 20-year-old production tax credit (PTC), the lamest is the claim that the PTC helps protect us from extreme weather.

PTC advocates talk as if Hurricane Sandy and the Midwest drought were obvious consequences of anthropogenic global warming, and that subsidizing wind energy is a cost-effective way to mitigate climate change.

They are wrong on both counts.

Neither economic analyses nor meteorological investigations validate the asserted link between recent extreme weather events and global warming. When weather-related damages are adjusted (“normalized”) to account for changes in population, per capita income, and the consumer price index, there is no long-term trend such as might indicate an increase in the frequency or severity of extreme weather related to global climate change.

A 2012 study in the journal Climate Change  examined 370 years of tropical cyclone data from the Lesser Antilles, the eastern Caribbean island chain bisecting the main development region for landfalling U.S. hurricanes. The study found no long-term trend in either the power or frequency of tropical cyclones from 1638 to 2009. It did however find a 50- to 70-year wave pattern associated with the Atlantic Multidecadal Oscillation, a mode of natural climate variability. [click to continue…]

“Harvard Needs Remedial Energy Math” — Robert Bryce

by Marlo Lewis on December 17, 2012

in Features

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Environmental activist Bill McKibben and his organization, 350.org, are on a ”Do the Math” tour in which they urge colleges and universities to “divest their endowments, estimated at a total of $400 billion nationwide, from the fossil fuel industry.” The 350.org campaign is explicitly modeled on the 1980s divestment campaign that persuaded many universities to dump their stock in companies doing business in South Africa. Radical environmentalists view fossil-energy use as the moral equivalent of apartheid — or worse.  

With about half of the student body polled, 72% of Harvard undergrads voted for the university to Go Fossil Free, reports energy scholar Robert Bryce in yesterday’s Wall Street Journal. Harvard is renowned for educating the ‘best and brightest.’ Should U.S. and global policymakers do as these ivy leaguers say?

Bryce takes the ‘Harvards’ to school and shows them what doing the math really means.

About 33% of global energy comes from oil, which is indispensable to transportation. Most of those voting to Go Fossil Free probably did not walk or bike from home to Harvard. As Steven Colbert asked McKibben, a Vermont native, during a Washington, D.C. protest rally against the Keystone XL Pipeline: How did you get down here? Did you ride your bicycle? Did you ride ox cart? ”Or do you have a vehicle that runs on hypocrisy?”

But okay, unselfconscious hypocrisy is a prerogative of the young.

Byrce’s math lesson proper begins with the fact that since 1985, global electricity demand has increased by 121%, three times faster than the growth rate of oil demand. Over the past 25 years, global electricity consumption increased on average by 450 trillion watts-hours (“terawatt-hours”) per year. ”That’s the equivalent of adding about one Brazil (which used 485 terawatt-hours of electricity in 2010) to the electricity sector every year,” Bryce writes. “The International Energy Agency expects global electricity use to continue growing by about 450 terawatt-hours per year through 2035.”

The point? The world in 2011 had 240,000 megawatts of wind generation capacity, producing 437 terawatt-hours of electricity. “Therefore, just keeping up with the growth in global electricity demand — while not displacing any of the existing need for coal, oil and natural gas — would require the countries of the world to install about as much wind-generation capacity as now exists, and they’d have to do so every year.”

Well, what’s wrong with that? For one thing, it would put a big fat industrial footprint across a lot of green space: “Put another way, just to keep pace with demand growth, the wind industry will need to cover a land area of some 48,000 square miles with wind turbines per year, an area about the size of North Carolina.” [click to continue…]

No Long-Term Trend in Frequency, Strength of Landfalling Hurricanes

by Marlo Lewis on December 17, 2012

in Features

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Numerous politicians, pundits, and activists, and even some scientists blame fossil-fuel emissions for the death and devastation wrought by Hurricane Sandy. Such allegations are ideological, not scientific.

As noted previously on this blog, when hurricane damages are adjusted (“normalized”) to account for changes in population, per capita income, and the consumer price index, there is no long-term trend such as might indicate an increase in hurricane frequency or power related to global climate change.

Moreover, 370 years of tropical cyclone data from the Lesser Antilles (the eastern Caribbean island chain that bisects the main development region for landfalling U.S. hurricanes) show no long-term trend in either power or frequency but a 50- to 70-year wave pattern associated with the Atlantic Multidecadal Oscillation, a mode of natural climate variability. 

A new study by Jessica Weinkle (University of Colorado), Ryan Maue (Naval Research Laboratory), and Roger Pielke, Jr. (University of Colorado) dumps more cold water on claims that global warming significantly (detectably) influences hurricane behavior.

The researchers examined data on the number and power of hurricanes making landfall in the five main hurricane basins: North Atlantic, northeastern Pacific, western North Pacific, northern Indian Ocean, and Southern Hemisphere. The data extend back to 1944 for the North Atlantic, to 1950 for the northeastern Pacific, and to 1970 for the other basins. The data for all basins is current through 2010.

Here’s what Weinkle, Maue, and Pielke, Jr. found:  

We have identified considerable interannual variability in the frequency of global hurricane landfalls; but within the resolution of the available data, our evidence does not support the presence of significant long-period global or individual basin linear trends for minor, major, or total hurricanes within the period(s) covered by the available quality data. Therefore, our long-period analysis does not support claims that increasing TC [tropical cyclone] landfall frequency or landfall intensity has contributed to concomitantly increasing economic losses.

Figure explanation: Red bars indicate the number of major (category 3-5) hurricanes, blue bars indicate the number of minor (category 1-2) hurricanes. [click to continue…]

Where Does ExxonMobil Stand on Carbon Taxes? (Updated Dec. 27, 2012)

by Marlo Lewis on December 11, 2012

in Features

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Yesterday on NPR’s radio program To the Point, I said it was dishonorable for ExxonMobil to support a carbon tax. I compared ExxonMobil’s reported embrace of carbon taxes to Enron’s lobbying for the Kyoto Protocol.

Enron was a a major natural gas distributor and saw in Kyoto a means to suppress demand for coal, natural gas’s chief competitor in the electricity fuel market. ExxonMobil is a major natural gas producer. So I took this to be another case of political capitalism – corporate lobbying to replace a competitive market with a rigged market to enrich a particular firm or industry at the expense of competitors and consumers.

The NPR program host said something like “even oil companies like ExxonMobil now support a carbon tax,” alluding to a Nov. 16 Bloomberg Businessweek article titled ”Carbon Fee From Obama Seen Viable With Backing From Exxon.” I too had read the article, and ExxonMobil’s reported behavior struck me as imprudent as well as unkosher. A carbon tax could come back to bite natural gas producers big time if the EPA decides, along the lines of Cornell University research, that fugitive methane emissions from hydraulic fracturing make natural gas as carbon-intensive as coal.

The Bloomberg article quoted an email from ExxonMobil spokesperson Kimberly Brasington:

Combined with further advances in energy efficiency and new technologies spurred by market innovation, a well-designed carbon tax could play a significant role in addressing the challenge of rising emissions. A carbon tax should be made revenue neutral via tax offsets in other areas.

As explained previously on this site, a revenue-neutral carbon tax is a political pipedream, as is a carbon tax that preempts EPA and State-level greenhouse gas regulations. ExxonMobil is too savvy not to know this. So I interpreted Brasington’s caveats (“combined,” “well-designed,” “revenue-neutral”) to be the typical K Street evasiveness of those wishing to signal rather than declare their support for a controversial policy.

But articles published today in FuelFix and The Hill contend that ExxonMobil “does not support” a carbon tax and is “not encouraging policymakers” to impose such a tax. Both articles quote ExxonMobil VP for public affairs and government relations Ken Cohen:

If policymakers are going to adopt a measure, a regime to affect or put in place a cost on the use of carbon across the economy, then as we look at the range of options, our economists and most economists would support a revenue-neutral, economy-wide carbon tax as the most transparent and efficient way of putting in place a cost on the use of carbon.

Not supporting and not encouraging is not the same as opposing. Indeed, not opposing while saying But if you’re gonna do it, do it like this! can be a low-profile way to support and encourage! Also, why say anything favorable about carbon taxes when cap-and-trade is dead and there’s no longer even a weak prudential case for supporting carbon taxes as the lesser evil? [click to continue…]

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