Platts Energy Week with Bill Loveless: American Wind Energy Association CEO Tom Kiernan gave illuminating answers in an interview with Bill Loveless on Platts Energy Week. At the 2:40 mark of the video below, Mr. Kiernan explains that the wind energy industry would go “bust,” if the U.S. Congress fails to extend a subsidy that gives wind energy generators a tax credit worth $23 per megawatt electricity produced.

Mr. Kiernan’s dire warning was backed up by a report earlier this week from Energy & Environment News’s Nick Juliano, whose independent estimate that the wind energy industry would lose 30,000 jobs, virtually overnight, absent this one subsidy.

Keep in mind that thirty States have enacted Soviet style production quotas for green energy, and that wind energy meets the overwhelming preponderance of these mandates. Thus, the wind energy industry enjoys a government-guarantee for consumer demand. Few and lucky are the politically connected industries that receive such a state-sponsored perk.

And yet, despite these green energy production quotas, the industry faces imminent collapse, according to its own top lobbyists, if a single, albeit egregious, tax handout is allowed to expire.

Which brings me to my final point. In the interview, Mr. Kiernan innocently claims that the wind industry merits the $23 per megawatt tax credit, because it wants a “level playing field” with conventional energy. While I readily advocate for the elimination of all subsidies, I question whether Mr. Kiernan is sincere. Absent mandates and subsidies for all energy sources, and unless fossil fuels are regulated out of existence, wind energy would die a swift death at the hands of conventional energy on even a relatively free market. When competition matters, intermittent and expensive (i.e., renewable energy sources) simply are no substitutes for cheap and reliable (fossil fuels, that is).

The McLaughlin Group: Four months ago, I noted how John McLaughlin skewered global warming alarmists on his wonderful show, The McLaughlin Group. It was late December, and the show was having its annual awards broadcast. What prompted my attention was McLaughlin’s awarding of the “2013 Enough Already Award,” to “the theory that now masquerades under the pseudonym of climate change.” He then continued, “Even its most honest supporters now admit that there has been no increase in the earth’s surface temperatures for 15 years. It’s time to admit the theory is flawed.”

Great stuff. And it leaves no doubt as to where he stands on the issue. On this week’s show, we got more of the same. Near the end of the show, McLaughlin introduced a segment about global warming, titled “Apocalypse Now?” The question mark is operative. The topic of the segment was the recent release of an Intergovernmental Panel on Climate Change report. Before the start of the roundtable debate, there was a long video lead-in to the segment, featuring one scary IPCC prediction after another. See for yourself (it starts at the 21:55 mark): [click to continue…]

Post image for WaPo Wonkblog Makes Case that EPA’s Carbon Pollution Standard Is Illegal

On Friday, Washington Post Wonkblog published a notable article about “clean coal,” defined by reporter Max Ehrenfreund as “[t]he suite of technologies that the industry hopes could one day remove carbon dioxide from exhaust at coal-fired power.”

The most mature of these “clean coal” technologies is known as carbon capture and sequestration (“CCS”), although it has never been outfitted on a coal-fired power plant of even moderate size. The purpose of the Washington Post article was to throw cold water on recent media reports regarding the promise of clean coal. According to Mr. Ehrenfreund, the case for CCS in the U.S. is “weak,” because the technology is “exorbitantly expensive.”

Somewhat bizarrely, the Wonkblog reporter failed to mention that the Environmental Protection Agency in February proposed the Carbon Pollution Standard, a requirement for CCS on all new coal-fired power plants. Due to a unique provision of the Clean Air Act, the regulation goes into effect upon proposal. As a result, all new coal-fired power plants require “clean coal” technology—the very technology that is the subject of the Washington Post Wonkblog article. You’d think that this would qualify as “news.”

Whatever the reason for this rather conspicuous omission, I want to draw attention to the reporter’s use of language, which offers an important legal lesson. Mr. Ehrenfreund wrote that CCS is “exorbitantly” costly. This modifier is supremely apt; it is the exact word chosen by the D.C. Circuit Court of Appeals* to describe an impermissible requirement pursuant to the provision of the Clean Air Act that authorizes the aforementioned Carbon Pollution Standard. See Essex Chemical Corp. v. Ruckelshaus, 486 F. 2d 427 at 433 (D.C. Cir. 1973). As such, if the costs of carbon capture and sequestration are in fact “exorbitant,” then the regulation is illegal.

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Post image for Senators Sessions and Inhofe Come Out Swinging against EPA

Senator Jeff Sessions (R-Ala.) announced at an Environment and Public Works Committee hearing this week on the nomination of Janet McCabe to be assistant administrator of the Environmental Protection Agency for air and radiation that he couldn’t vote to confirm McCabe if she insists on denying the conclusion of the UN Intergovernmental Panel on Climate Change that there is no historic trend in the incidence and severity of tropical cyclones (hurricanes and typhoons).  Here’s the video clip.

Climate Progress, an especially deranged outpost of the ironically-named Center for American Progress’s Think Progress web site, immediately accused Sen. Sessions of opposing McCabe “because she accepts climate science.”

At the same hearing, Senator James M. Inhofe (R-Okla.), former chairman of the committee, announced that he will start offering resolutions of disapproval under the Congressional Review Act for every new EPA air regulation until the agency starts doing ongoing economic and employment assessments for all Clean Air Act regulations on an economy-wide basis.  Such assessments seem to be required by Section 321 (a) of the Clean Air Act, but the EPA has always (during previous Republican and Democratic administrations as well as the current administration) limited its analyses to the economic effects of only the facilities directly regulated.

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Post image for Ivanpah: Dead Technology Propped Up by California Ratepayers

In February, the New York Times ran a stunning article, “A Huge Solar Plant Opens, Facing Doubt about the Future,” concerning the start of the Ivanpah project, the world’s largest concentrated solar thermal power plant. Situated in California’s Mohave Desert, Ivanpah generates up to 393 megawatts of solar power with 350,000 mirrors arrayed over five square miles, which redirect and focus the sun’s rays in the service of boiling water to drive conventional steam turbines. According to the New York Times report, industry analysts believe that the technology behind Ivanpah is no longer viable on the energy market, even though the project is brand new. It was “stunning,” to me, insofar as negative takes on green energy infrequently appear within The Grey Lady.

Yet the news also must have come as a shock to California ratepayers, who will be responsible for propping up this dead technology for the next two decades. In a recent interview on the invaluable Platts Energy Week with Bill Loveless, BrightSource Energy (the Ivanpah developer) senior vice president Joseph Desmond described the long-term purchasing power agreements his company signed with Pacific Gas & Electric and Southern California Edison as being akin to “building a hotel and having 100% occupancy guaranteed for twenty years the day you open.” Sounds like a great deal—for BrightSource.

 

It’s not as if Ivanpah’s power will be cheap. The exact terms of these long term contracts, known as purchasing power agreements, are not publicly available. However, we do know that the raw project costs were $2.2 billion, and that the peak power output is 393 megawatts. Because the sun only shines half the day, we can safely give the plant an effective capacity of 200 or so megawatts, although even this energy isn’t dispatchable. So that works out roughly to $2.2 billion for 200 megawatts of unreliable capacity, or $11,000/kilowatt. By comparison, the most recently constructed coal-fired power plant I can think of off the top of my head, Xcel Energy’s 760 megawatt Comanche 3 power plant in Pueblo, Colorado, which was outfitted with the latest, most expensive environmental controls, cost $1,700/kilowatt.*

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Post image for Must Read: Walton Francis on the Social Cost of Carbon

Walton Francis, formerly director of regulatory analysis at the Department of Health and Human Services, submitted a sharply critical comment letter to the Office of Management and Budget (OMB) on the Obama administration’s social cost of carbon (SCC) estimates.

Yes, I realize, this isn’t breaking news, but the SCC debate will be with us for years, and, as explained previously on this site, SCC analysis has become a menace to society.

SCC analysis is computer-aided sophistry. By “sophistry,” I mean what Socrates meant by it in Plato’s dialogues. Sophistry is sham wisdom raised to the level of a τέχνη (technê), the Greek word for art, craft, or trade.

The leading rap against the sophists in classical literature is that they “make the weaker argument [defeat/appear to be] the stronger.” That is, sophists use specious arguments to win in courts and public assemblies regardless of the merits of the case or issue in dispute. Turning common sense upside down, they make wrong look right and base look noble.

SCC analysis, similarly, uses sophisticated modeling to make renewable energy look like a bargain at any price and carbon energy look unaffordable no matter how cheap. OMB Circular A-4 on cost-benefit analysis admonishes agencies that “you cannot conduct a good regulatory analysis according to a formula.” SCC analysis is a license to regulate by formula. Grant the premise that carbon has a social cost, and presto, climate activists conclude that taxing and regulating away reliable, plentiful, affordable energy will make the economy more “efficient.” For further discussion, see the free market organizations’ comment letter to OMB on the social cost of carbon.

For those unfamiliar with this debate, the administration’s Interagency Working Group (IWG) has put out two technical support documents on the social cost of carbon (2010 TSD, 2013 TSD). The documents define the social cost of carbon as “an estimate of the monetized damages associated with an incremental increase in carbon dioxide [CO2] emissions in a given year.” Implicit in that definition is another one: The SCC “is the carbon tax that would be imposed by a benevolent social planner.”

The IWG’s 2013 SCC estimates stirred up controversy because they were roughly 60% higher than the 2010 estimates, yet nothing had happened either to the climate system or in climate science to warrant the revision. What did happen is the warming “pause” continued for another three years, the divergence between climate model projections and observed temperatures increased, and scientific research further discredited Al Gore’s doomsday scenarios.

With that as background, let’s review Francis’s comment letter.

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Post image for True Conspiracy Theory: The Green Assault on Civil Liberties

There exists an environmentalist strain of armchair psychology that dismisses the input of free-marketers on the issue of global warming, due their supposed affinity for conspiracy theories about runaway government. According to this line of reasoning, some “conservatives” are “individualists,” who innately reject global warming alarmism, because of an unfounded fear that mitigating climate change would endanger their civil liberties.

I’ve long dismissed this reasoning as self-serving propaganda. After all, what better way to de-legitimize your opponents than to call them kooks? It seemed to me like a cheap debate trick. Now, however, I’m not so sure. It’s not that I’ve joined the black helicopter crowd. Rather, evidence is mounting that environmentalists both prominent and plebeian are all-too willing to forsake my civil liberties in order to mitigate climate change, the supposed #1, end-all problem now facing mankind.

To wit, a group of Senators in January formed an ad hoc caucus of global warming alarmists and their first task was to pressure Sunday news programs on global warming coverage. To this end, nine Senators sent a letter to Fox News chief Roger Ailes, CBS News President David Rhodes, ABC News President Ben Sherwood and NBC News President Deborah Turness, deploring the paucity of coverage given to climate catastrophes. They concluded,

“We urge you to take action in the near term to correct this oversight and provide your viewers, the American public, with greater discussion of this important issue that impacts everyone on the planet.”

Not coincidentally, each network that received this letter ran a major climate change segment on its Sunday show within weeks.

Alas, these news nannies aren’t yet done. This week, one of the group, Sen. Sheldon Whitehouse, took to the floor of the floor of the world’s greatest deliberative body so as to bemoan the absence of coverage of the recent UN climate report by the cable news networks. No doubt, a strongly-worded letter “urging” the networks to “correct this oversight” is in the works.

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In which region of the world are plants most productive in photosynthesizing water and carbon dioxide into carbohydrates? If you guessed the tropical rain forest, you’d be wrong. The region with the highest gross primary production (GPP) from photosynthesis is the U.S. corn belt.

That is the finding of a new study (Guanter et al. 2014) published in Proceedings of the National Academy of Sciences (PNAS). The team of 20 researchers used satellite-based spectroscopy to monitor sun-induced chlorophyll fluorescence (SIF), an electromagnetic signal emitted as a byproduct of photosynthesis.

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Global map of maximum monthly sun-induced chlorophyll fluorescence (SIF) per 0.5° grid box for 2009.

The results of the study really shouldn’t be surprising. The U.S. leads the world in combined private-public R&D spending on agriculture and is the world’s top corn producer and agricultural exporter. Nonetheless — and this too is not surprising — the corn belt GPP reflected in satellite SIF data substantially exceeds the GPP estimated in carbon cycle models. The researchers report:

Our SIF-based crop GPP estimates are 50–75% higher than results from state-of-the-art carbon cycle models over, for example, the US Corn Belt and the Indo-Gangetic Plain, implying that current models severely underestimate the role of management.

Perhaps to appease the political-correctness guardians at PNAS, the study begins with a warning that “past advances” in agriculture are “threatened by climate change,” and the authors say their research is significant because it provides benchmark data for “more reliable projections of climate impact on crop yields.”

Clearly, though, the finding is also significant for another reason. It doesn’t fit into the fear narrative promoted by the recently-released IPCC Working Group II (WG2) report on climate impacts. Current models “severely underestimate the role of management.” That suggests current models underestimate farmers’ ability to adapt to climate change. [click to continue…]

A new climate study, “Global warming and 21st century drought,” is making waves through the blogosphere. It’s the latest in “worse than we thought” gloom and doom narratives. Authors Benjamin I. Cook and colleagues at the Lamont-Doherty Earth Observatory find that warming will not only decrease precipitation in dry regions but also increase evaporation from soils, causing more drought than previously predicted.

So although the IPCC Working Group I report concluded that, in the 21st century, Atlantic Ocean circulation collapse is “very unlikely,” ice sheet collapse is “exceptionally unlikely,” and catastrophic release of methane from melting permafrost is “very unlikely,” we’re still on eve of destruction.

As summarized in the study’s press release, by 2100 drought could afflict 30% of the Earth’s surface, “crops could wither in multiple regions simultaneously,” and “food price shocks could become far more common.” These results are “consistent with” the latest IPCC report, which “also predicts a strong chance of soil moisture drying in the Mediterranean, southwestern United States and southern African regions.”

The Cook team’s study is “one of the first to use the latest climate simulations to model the effects of both changing rainfall and evaporation rates on future drought.” Well, climate models haven’t exactly performed brilliantly in replicating global temperatures, have they? What do actual climate data and climate history tell us about the relationship between warming and drought?

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Post image for “The idea that climate change poses an existential threat to humankind is laughable” — Prof. Richard Tol

Climate economist Richard Toll has a provocative op-ed in today’s Financial Times titled “Bogus prophesies of doom will not fix the climate.” Last week, Tol accused the IPCC of being too alarmist about global warming and asked to have his name withdrawn from its recently-released Working Group II report (WG2) on climate change impacts.

Public discourse on climate change would be much improved if every discussion — for example, Secy. of State John Kerry’s climate speech in Jakarta, Indonesia — began with a reading of Tol’s opening paragraph:

Humans are a tough and adaptable species. People live on the equator and in the Arctic, in the desert and in the rainforest. We survived ice ages with primitive technologies. The idea that climate change poses an existential threat to humankind is laughable.

Even if one accepts WG2′s estimate that a “further warming of 2°C could cause loses equivalent to 0.2-2 per cent of world gross domestic product,” that is “about as bad as losing one year of economic growth” in half a century, Tol notes. In contrast, since the start of the Eurozone financial crisis, the income of the average Greek has fallen more than 20%. “Climate change is not, then, the biggest problem facing humankind.”

After noting that climate change is not even the biggest environmental problem (indoor air pollution has killed 260 million people — more than all the wars of the 20th century combined, Bjorn Lomborg estimates), Tol points out that the best protection from climate-related risk is economic growth and the institutions that facilitate it:

Climate change will make the disease [malaria] worse. Economic growth will make it go away.

In the worst case, climate change could cut crop yields in Africa in half. Yet yields would increase tenfold — in the same climate, on the same soil — if subsistence farmers started using crops and techniques pioneered on experimental farms. Climate change may be a big issue in Africa. But it is not nearly as important as lack of tenure, poor roads, roving warlords and so on.

Tol agrees with the IPCC that “We cannot let the planet grow warmer and warmer,” but solving that problem must wait until “carbon neutral technologies saturate the market,” which “will take decades at least.”

I don’t share Tol’s faith in the ability of government-directed “adaptation and development” to “improve lives.” But his contention that the IPCC’s “prophecies of doom” are false and divert public attention and resources from more urgent threats is spot on.

Readers of this blog are no doubt up to speed with the revolution in drilling technology—collectively known as hydraulic fracturing, or “fracking”–that has unleashed an American energy boom. Thanks to fracking, U.S. oil production grew by a record 1.136 million barrels a day last year to 8.121 million barrels a day. Gas production has increased by even greater leaps and bounds, such that there is clamoring on Capitol Hill to facilitate gas exports as a strategic geopolitical asset.

North Dakota has been a locus of the U.S. energy renaissance. It is the home of the Bakken formation, one of North America’s largest oil-rich shale plays unlocked by fracking. The economic impact has been eye-popping. The State now proudly claims the nation’s lowest unemployment and a per-person gross domestic output significantly higher than the national average. Last week, the Department of Labor released statistics showing that the citizens of North Dakota enjoyed the fastest year over year increase in personal income at 7.6 percent. Current per capita income in North Dakota is $57,000, second only to Connecticut, and has increased by almost 50 percent since 2009.

To better understand how the domestic energy industry is at work in North Dakota, check out the great infographic below, “The Burgeoning Bakken,” from Hart Energy by way of the Unconventional Oil & Gas Center.

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