Utility mact presentation
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Senator James M. Inhofe (R-Okla.) has announced that he will bring a Congressional Review Act resolution of disapproval of the EPA’s Utility MACT (for Maximum Achievable Control Technology) Rule to the Senate floor for a vote on or before Monday, 18th May. Since Senate Majority Leader Harry Reid (D-Nev.) is trying to hold as few votes on tough issues as possible before the November elections, this could be the most important vote on an energy or regulatory issue that the Senate takes this year.
Under the Congressional Review Act, the resolution of disapproval, S. J. Res. 37, is a privileged motion. A vote cannot be blocked by the Majority Leader or filibustered and requires only a simple majority to pass.
The Utility MACT Rule would regulate mercury and some other emissions from coal-fired power plants. The proposed limits are so stringent that utilities will be forced to close many coal-fired power plants. This will raise electric rates and threaten electric reliability in many States.
CEI this week published a paper by Marlo Lewis, William Yeatman, and David Bier titled, All Pain and No Gain: the Illusory Benefits of the Utility MACT. It shows that the health benefits claimed by the EPA are non-existent, while the costs to consumers and manufacturers are huge.
The vote on the resolution is likely to be very close. Right now, it looks like it will lose narrowly. Senator Inhofe appears to have the support of forty fellow Republicans and four Democrats. The Democrats are Senators Joe Manchin of West Virginia, Ben Nelson of Nebraska, Mark Pryor of Arkansas, and Mary Landrieu of Louisiana.
Five Republicans oppose the resolution or are leaning no. They are Lamar Alexander of Tennessee (whose opposition has been outspoken), Scott Brown of Massachusetts, Olympia Snowe of Maine, Susan Collins of Maine, and Kelly Ayotte of New Hampshire. A number of Democrats are not publicly committed. They include: Jon Tester of Montana, Max Baucus of Montana, Claire McCaskill of Missouri, Bob Casey of Pennsylvania, Jim Webb of Virginia, Mark Warner of Virginia, Kent Conrad of North Dakota, and Debbie Stabenow of Michigan.
Senator Mark Kirk (R-Ill.) is still recovering from a stroke, so is not expected to vote. That means that if all other Senators vote, the resolution will need fifty votes to pass. As I see it, Senator Inhofe needs to gain the support of at least two more Republicans and then focus on getting three Democrats who are in tough re-election races in States that mine or use a lot of coal.
Ron Bailey of Reason took a closer look at one of the many reports out there written to discredit those organizations (and corporations) that remain skeptical of plans to dramatically scale back the world’s carbon dioxide emissions. What the report intended to insinuate was that corporations were hypocritical: they claimed to publicly support policies to combat climate change but privately gave money to those organizations whose aims were to undermine support for such policies. While I can certainly believe that some corporations will want to present a happy face to the public while also being more privately concerned with the impact new legislation has on their profitability, upon closer inspection the report wasn’t quite what it seemed:
In line with the findings of the UCS, the L.A. Times specifically declared, “General Electric has backed six environmental and non-partisan research groups that accept the scientific consensus on climate change, including the Brookings Institution and the Nature Conservancy. At the same time, it has funded four organizations that reject or question the consensus, including the Competitive Enterprise Institute and Heritage Foundation.” Based on the UCS report, The Guardian (U.K.) stated, “Some of America’s top companies are spending heavily to block action on climate change or discredit climate science, despite public commitments to sustainable and green values.” The Guardian specifically mentioned that UCS had identified General Electric as being two-faced about climate change. According to the UCS report, among the four GE-supported organizations that “misrepresent” climate-change science is the Reason Foundation, the nonprofit that publishes this website.
So what vast sums of money did the duplicitous executives at General Electric lavish on the Reason Foundation in 2008 and 2009 to support an implied campaign to traduce climate science? Exactly $325. How much did GE spend on matching and direct grants on the six think tanks identified by the UCS as being pro-climate consensus? That would be $497,744. At least with regard to General Electric’s contributions, it appears that the Union of Concerned Scientists has salted a follow-the-money trail with pieces of fool’s gold, which certain unwary news outlets obligingly picked up and reported as real bullion.
You can read the entire report here. It’s mostly documentation of various corporations and their perceived support or opposition towards climate change legislation. It separates groups into what seems to be “good” and “bad,” with most of the fossil fuel energy making the bad group.
The noteworthy part is the way in which the media swallowed the conclusions without doing any work of their own. Bailey points out that the only funding Reason received from General Electric was to the tune of roughly $300, and only because G.E. has a company wide policy that matches donations made by employees to groups like the Reason Foundation or the Competitive Enterprise Institute. The report didn’t mention that GE’s support was not actually corporate funding, but rather a very small match towards employee contributions. Keith Kloor offers sympathetic commentary.
The Competitive Enterprise Institute attended the 7th International Conference on Climate Change, sponsored by the Heartland Institute and held in downtown Chicago on May 21-23. We at CEI are deeply indebted to the Heartland staff for all the hard work that went into putting on this event. The conference ran smoothly and I thought it was well attended despite the recent public kerfuffle over the incident with Peter Gleick and Heartland’s billboard campaign. CEI’s Myron Ebell and Chris Horner participated in a panel on the social and economic impacts of climate change and climate change policies. A videos of Myron’s panel is embedded below, and Chris Horner’s can be watched at this link.
“We are winning the war!” was a phrase I heard repeatedly last week. Congressman Sensenbrenner, Vice Chair of the House Committee on Science, Space, and Technology, said: “We won on these issues because we were right.”
What “war” brought together more than 60 scientists from around the world—including astronauts, meteorologists, and physicians; politicians—comprising the Congressman, a head of state, and a member of the European Parliament; and policy analysts and media for two-and-a-half days in Chicago? The battle over climate change and the belief that there needs to be real science—more “about honest debate than ideological warfare.”
Assembled by the Heartland Institute, the seventh International Conference on Climate Change (ICCC7) provided the second opportunity for Congressman Sensenbrenner to address the group. In his opening comments, Sensenbrenner said, “We’ve come a long way.”
He recounted: “When I last spoke, the House of Representatives was poised to pass the Waxman-Markey cap-and-trade bill; the United Nations was promising the extension and expansion of the Kyoto Protocol; and President Obama was touting Spain as our model for a massive increase in renewable energy subsidies. Three years later, cap-and-tax is dead; the Kyoto Protocol is set to expire; and Spain recently announced that it eliminated new renewable energy subsidies.”
Sensenbrenner told about the behind the scenes wrangling that went on to get the Waxman-Markey bill passed. “I was on the House floor on June 29, 2009, when then-Speaker Nancy Pelosi desperately pulled Members aside to lobby, beg, and bargain for votes for the Waxman-Markey bill.” It did pass. But “the electoral consequences for the proponents of these policies was severe.” Just 16 months later, in the 2010 elections, “over two dozen of the Members she convinced to vote ‘yes’ lost their jobs.”
It wasn’t just the Members who suffered harsh political ramifications for their support of the Waxman-Markey bill—which was supposed to nullify the impact of manmade global warming through a cap-and-trade scheme. Sensenbrenner contends that support of the manmade (anthropogenic) global warming position (AGW) also cost Al Gore the presidency back in 2000. He explained: “West Virginia’s 5 electoral votes would have tipped the election for Gore, and Gore’s near-evangelical support for climate change easily cost him the 42,000 votes he would have needed to win there.”
Last week the EPA dismissed a petition by the American Petroleum Institute seeking relief from the cellulosic ethanol mandate, which requires that oil refiners blend 8.65 million gallons of ethanol into the fuel supply by the end of 2012:
“In all cases, the objections raised in the petition either were or could have been raised during the comment period on the proposed rule, or are not of central relevance to the outcome of the rule because they do not provide substantial support for the argument that the Renewable Fuel Standard program should be revised as suggested by petitioners,” EPA told API, American Fuel & Petrochemical Manufacturers, Western States Petroleum Association, and Coffeyville (Kan.) Resources Refining & Marketing on May 22.
“EPA’s mandate is out of touch with reality and forces refiners to pay a penalty for not using imaginary biofuels,” Bob Greco, API’s downstream and industry operations director, said on May 25. “EPA’s unrealistic mandate is effectively an added tax on making gasoline.”
Greco said the Clean Air Act requires EPA to determine the mandated volume of cellulosic biofuels each year at “the projected volume available.” However, in 2011 EPA required refineries to use 6.6 million gal of cellulosic biofuels even though, according to EPA’s own records, none were commercially available, Greco said.
EPA has denied API’s 2011 petition to reconsider the mandate and continues to require these nonexistent biofuels this year, he indicated. Greco called the action “regulatory absurdity and bad public policy.”
As regular readers of this blog will know, the whole problem with the EPA’s non-flexible mandate is that there is no commercially available cellulosic ethanol, thus making it impossible to meet the mandate. The EPA’s justification for this policy is that they need to maintain an incentive for companies to begin producing cellulosic ethanol, despite many past failures. The oil refiners are also required to purchase these cellulosic ethanol waivers, effectively giving the government money instead of purchasing the non-existent fuel. [click to continue…]
Fretting about rising sea levels is a hallowed past-time amongst global warming types. Al Gore and Co. regularly ride through the public square yelling “The ice sheets are melting! The ice sheets are melting!”
Indeed the threat of catastrophic sea level rise due to the melting of polar ice has been one of the prime scare tactics in the alarmists’ arsenal, even if they have occasionally stooped to exaggerating the dangers. National Public Radio Science Correspondent Richard Harris once lamented this fudging of the truth in an interview with NPR’s Renee Montagne
“Gore said that Arctic ice could be gone entirely in 34 years, and he made it seem like a really precise prediction. There are certainly scary predictions about what’s going to happen to Arctic sea ice in the summertime, but no one can say ‘34 years.’ That just implies a degree of certainty that’s not there. And that made a few scientists a bit uncomfortable to hear him making it sound so precise.”
Harris went on to question some of the outrageous claims made in Gore’s scarumentary “An Inconvenient Truth.”
“…in [Gore’s] documentary he talks about what the world will look like – Florida and New York – when the sea level rises by 20 feet. But he deftly avoids mentioning the time frame for which that might happen. When you look at the forecast of sea-level rise, no one’s expecting 20 feet of sea-level rise in the next couple of centuries, at least. So that’s another thing that makes scientists a little bit uneasy; true, we have to be worried about global sea-level rise, but it’s probably not going to happen as fast as Gore implies in his movie.”
No kidding. But Gore’s over-zealous estimations aside, Harris thinks we should still worry about melting ice and its concomitant rise in sea levels. And we–as in, we the people–are of course to blame with our dirty, carbon-spewing life style.
Warmists are therefore desperate to preserve the polar ice exactly as they are–or rather, exactly as they think they should be. But this attitude takes for granted the notion that the ice caps are a permanent and unchanging feature of this planet.
Not true.
Senate Committee Checks Obama’s Push To Green the Military
The Senate Armed Services Committee voted in favor of two amendments this week to block key parts of the Obama Administration’s program to green the military. Politico Pro reported that all Republican members of the committee were joined by two Democrats to pass the amendments by one-vote margins, 13-12.
An amendment offered by Senator John McCain (R-Az.) would prohibit the Department of Defense from building biofuel refineries unless authorized by Congress. If enacted, this would halt the Navy’s plan to build a $170 million biofuel facility. Democratic Senators Joe Manchin of West Virginia and James Webb of Virginia joined the committee’s eleven Republicans in voting for the amendment.
Another amendment offered by Senator James M. Inhofe (R-Okla.) would prohibit expenditures for alternative fuels “…if the cost of producing or purchasing the alternative fuel exceeds the cost of producing or purchasing a traditional fossil fuel that would be used for the same purpose….” Democratic Senators Manchin and Claire McCaskill of Missouri joined the Republicans to pass this amendment. A similar provision was passed in the House of Representatives last week.
Carbon Markets Work, Until They Don’t
Having added layers of bureaucracy and complexity to their energy markets, the United Kingdom is struggling with a number of different problems in their electricity markets: rising prices, lowered reliability, and record low prices on carbon emissions. The UK’s answer involves granting the government further power to intervene in electricity markets. Under a draft energy bill put forth by Edward Davey, the Secretary of State for Energy and Climate Change, the new legislation would ban new coal-fired power plants absent carbon capture and sequestration, set a price floor for carbon dioxide emissions, and provide guaranteed rates of return on new low-carbon energy sources to encourage the increased investment that has yet to materialize. Like many bureaucrats, Davey is confident his proposal is a blueprint for success: “If we don’t secure investment in our energy infrastructure, we could see the lights going out, consumers hit by spiraling energy prices and dangerous climate change. These reforms will ensure we can keep the lights on, bills down and the air clean.”
Airline Emissions Fight, Round XVII
It’s the song that will never end. This week, those who predicted that this dispute would end in a trade war will feel a twinge of gratification: India has threatened to ban European airlines from Indian airspace if the Europe Union begins to impose sanctions on Indian airlines. Last week, both the Chinese and Indian governments forbade their airlines from providing the EU with data on their carbon emissions, signaling that this situation is not going to be resolved amicably anytime soon. The EU now seems to have backed off, to some extent, from the tough talk and complete refusal to back down. A spokesman for Connie Hedegaard, the EU climate commissioner, stated that the UN’s International Civil Aviation Organization was hoping to reach a mutually agreeable solution prior to April of 2013. It remains unclear what this solution will involve, as India and China have shown little interest in international negotiations to limit their economic growth through carbon taxation.
When the government introduced the mandates for ethanol and related biofuels, they needed a way in which companies could verify that they were complying with the Energy Independence & Security Act of 2007. For whatever reason, the decided mechanism would require that companies purchase credits to demonstrate that they had complied with the mandate: a renewable identification number (RIN). Each RIN is theoretically tied to a gallon of ethanol, biodiesel, or similar renewable fuel. However, because the RINs can be sold and traded similar to stock, in practice the pairing of a RIN with a particular gallon of fuel is somewhat superficial.
Unfortunately, this government created market in RINs has created an opportunity for criminally-minded entrepreneurs to scam the companies who are attempting to comply with the law by creating fake RINs and selling them in the marketplace. Note that these oil companies are required by law to purchase these credits, and its often difficult to verify that they are genuine, leading oil companies to often completely bypass small producers and only purchase biofuels and credits from larger, recognizable producers, a somewhat unique barrier to entry for small firms (suspicion of fraud). The latest case in fraudulent RINs surfaced late last month involved the sale of 60 million credits worth roughly $84 million, the third big bust in recent years ($ub required):
According to the violation notice, EPA determined that the fake credits were generated between July 16, 2010, and July 15, 2011. The Clean Air Act allows the agency to assess a civil penalty of up to $37,500 a day for each violation.
“When fuel credits are generated or used that do not represent qualifying renewable fuel, it undermines Congress’ goals in creating the program, creates market uncertainty and is a violation of the standard,” EPA said in a statement emailed to Greenwire. “EPA enforcement of the standard deters fraud and abuse in the system, helps to restore certainty in the market and ensures that the goals of Congress are met.”
This is the third notice EPA has issued since November to companies allegedly producing fake credits, and it is likely not the last.
Last November, EPA accused a Maryland man of generating $9 million worth of fraudulent renewable identification numbers (RINs) on his computer. The 38-digit numbers represented 22 million gallons of biodiesel that was never produced at the man’s company, Clean Green Fuel LLC.
EPA issued another violation notice in February to Texas-based Absolute Fuels LLC for allegedly creating 48 million fake credits worth approximately $62 million. The agency said CEO Jeffrey Gunselman used the money to purchase an aircraft and a number of vehicles, including a 2010 Mercedes Benz and a 2011 Bentley.
Yes, creating markets that are easy to fraudulently manipulate would indeed seem to undercut the goal of the ethanol mandate. Thankfully, unlike in previous cases, the EPA is working constructively with the companies who have been subjected to these scams rather than fining them for getting caught up in a problem the government has created.
This is yet another reason why moving forward with increasing blends of ethanol is not a good idea. Freeze the mandate at 2012 levels if it can’t be scrapped completely. Yes, the short term capital losses from ethanol investments will be realized, and this will hurt a lot, but the alternative is to continue investments into a fuel that is still more expensive than gasoline once you adjust for its lower energy content. Or we can continue pretending that whatever minute environmental benefits accrue from corn ethanol are worth the absurd push to encourage ethanol use beyond E10. We can also continue to pretend that cellulosic ethanol is around the corner, and won’t suffer from the same problems that have haunted corn ethanol: high prices and heavy land use.
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