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Post image for EPA Sets 2012 Biofuel Requirements

Yesterday the EPA finalized the 2012 mandate for blending biofuels into our nation’s transportation fuel supply:

The U.S. Environmental Protection Agency (EPA) today finalized the 2012 percentage standards for four fuel categories that are part of the agency’s Renewable Fuel Standard program (RFS2). EPA continues to support greater use of renewable fuels within the transportation sector every year through the RFS2 program, which encourages innovation, strengthens American energy security, and decreases greenhouse gas pollution.

The Energy Independence and Security Act of 2007 (EISA) established the RFS2 program and the annual renewable fuel volume targets, which steadily increase to an overall level of 36 billion gallons in 2022. To achieve these volumes, EPA calculates a percentage-based standard for the following year. Based on the standard, each refiner and importer determines the minimum volume of renewable fuel that it must ensure is used in its transportation fuel.

The final 2012 overall volumes and standards are:

Biomass-based diesel (1.0 billion gallons; 0.91 percent)
Advanced biofuels (2.0 billion gallons; 1.21 percent)
Cellulosic biofuels (8.65 million gallons; 0.006 percent)
Total renewable fuels (15.2 billion gallons; 9.23 percent)

In a nod to how hard it is to predict the future, the EPA has lowered the cellulosic biofuel mandate from 500 billion gallons to a less ambitious 8.65 million gallons, which is 1.7% of the original planned requirement. Of course, they have done the same in previous years and as of October no qualifying cellulosic ethanol had been sold to refiners. Naturally, refiners are not pleased that in 2012 they will possibly be spending up to $8 million in credits depending upon actual production levels of cellulosic ethanol:

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Many people today believe that environmental conditions are worsening. In The Improving State of the World, Indur Goklany thoroughly refutes this idea. Nonetheless, environmentalists continue to perpetuate the view that increased wealth and prosperity mean a poorer environment, but as this excerpt from Goklany’s work shows, this is not the case.

The Improving State of the World was published in 2007

Clearly, technological change is one key to continued improvement in environmental and human well-being. At least two ingredients are necessary to bring about technological change. First, better technology must be brought into existence. With greater wealth, expenditures on research and development increase. Therefore, the likelihood of developing new or improved technology should rise with wealth, which helps maintain and enhance human capital. This, in turn, not only further enhances the possibility of devising better technologies but it also propagates knowledge about the existence and operation of existing and new technologies, which is a key element for the diffusion of technology.

But there is more to technological change than creating technology or being aware of its existence. Although poor countries (and their farmers) are cognizant of technologies that would improve agricultural productivity, they are unable to capitalize on that information, despite that many such technologies, for example, fertilizer and crop protection measures, are quite mundane. Thus, their agricultural yields are substantially lower as are their food supplies. As a result, hunger and malnourishment are higher, and pressures for deforestation are greater. Similarly, notwithstanding that nowadays authorities in even the poorest countries know how to extend access to safe water and sanitation to 100 percent of the population, they lack the wherewithal to do so. Consequently, 1.1 billion people worldwide still lack access to safe water and 2.4 billion to adequate sanitation, virtually all in the poorer countries.

The missing ingredient, of course, is wealth, without which not only it harder to invent, develop, perfect, and use new technologies, but even old technologies are often unaffordable. Greater wealth increases the likelihood of acquiring, operating, and maintaining new as well as existing technologies. That is, wealth not only helps create technology and conditions favorable for its diffusion but wealth also ensures that technology is, in fact, used to make technological change a reality. It is hardly surprising that in previous chapters, we saw repeatedly that virtually every indicator of human well-being or environmental impact sooner or later improves with wealth. Hence, wealth increases cereal yields, which helps reduce rates of deforestation. It boosts the ability to install air pollution controls and to substitute cleaner fuels for dirty ones. Wealth also increases access to safe water and sanitation, which then reduce mortality due to water-related diseases.

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Post image for Global Government: The Third Ring in the Climate Change Circus

During his 2008 campaign, President Obama made his support of climate-change interventions clear, stating that his presidency would slow the rise of the oceans and begin to heal the planet. He promised that a cap-and-trade system would curb global warming.

He was elected, but the electorate hasn’t liked many of his policies. Cap and trade never passed Congress. To this day, President Obama has remained comparatively popular, but people believe he is taking the country in the wrong direction—toward a European system. Even his Secretary of Energy, Steven Chu, believes our gasoline prices should be higher, like Europe’s.

Two weeks ago, my column addressed China’s act (ring #1) in the climate-change circus. Last week, I looked at Europe’s staunch support for climate-change intervention when the majority of the industrialized countries have rejected or resisted a Kyoto-style deal (ring #2). Using Italy as an example, I suggested that the country’s lack of natural resources made expensive renewable energy a viable option for them—though an economic tightrope destined to failure.

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Even the liberal Washington Post, which hasn’t endorsed a Republican for President since 1952, seems to be souring on the Obama Administration’s failed energy programs, saying they were “infused with politics at every level.” As it noted in discussing the Solyndra scandal: “Obama’s green-technology program was infused with politics at every level, The Washington Post found in an analysis of thousands of memos, company records and internal ­e-mails. Political considerations were raised repeatedly by company investors, Energy Department bureaucrats and White House officials. The records, some previously unreported, show that when warned that financial disaster might lie ahead, the administration remained steadfast in its support for Solyndra,” which was owned by major Obama backers, like George Kaiser.

As law professor Glenn Harlan Reynolds notes, “all the ‘stimulus’ and ‘green energy’ stuff was never anything but a program to put taxpayer money into the hands of cronies and supporters.”

The Obama Administration hastily approved the  taxpayer subsidies for Solyndra despite obvious danger signs and warnings from accountants about the company’s likely collapse, the misgivings of agency officials, and the company’s mismanagement and lousy-quality products. (Solyndra executives are now pleading the 5th Amendment to avoid disclosing incriminating information.) The Obama administration was determined to shovel taxpayer money to its cronies as fast as it could. As an Obama fundraiser and Solyndra stakeholder exulted,  “there’s never been more money shoved out of the government’s door in world history and probably never will be again than in the last few months and the next 18 months. And our selfish parochial goal is to get as much of it . . . as we possibly can.”  “At the time Solyndra received its grant, Vice President Joe Biden declared that the Solyndra investment is ‘exactly what the [the stimulus package] is all about.’”

While diverting taxpayer money away from productive and efficient businesses to corporate-welfare recipients controlled by political cronies, the Obama Administration is busy wiping out jobs through thousands of pages of counterproductive regulations.  Some of these new regulations are designed to spawn lawsuits that will enrich trial lawyers at businesses’  and consumers’ expense.

Obama appointees at the EEOC are busy harassing businesses that hire and fire based on merit, thus discouraging employers from hiring or expanding operations, and the EEOC is bringing costly, unjustified lawsuits against businesses.  The 2010 healthcare law imposes financial burdens — some of them large, and others difficult to calculate — on the nation’s employers, resulting in some business owners deciding not to expand or hire new employees.

Many businesses are also suffering from the effects of the Dodd-Frank financial “reform” law, a 2,315 page monstrosity that makes it harder for small businesses to obtain credit, and also outsources and wipes out jobs in the financial sector. Even one-time Obama supporters in the business community have grown disenchanted: Democratic businessman Steve Wynn called Obama“the greatest wet blanket to business and progress and job creation in my lifetime,” saying that “the business community in this country is frightened to death of the weird political philosophy of the President of the United States. And until he’s gone, everybody’s going to be sitting on their thumbs.”

The Obama administration has sought to temporarily pump up the economy with stimulus spending paid for with massive deficits, but as the Congressional Budget Office has noted, the stimulus package will actually shrink the economy in the long run, so it will not be able to offset the economic drag resulting from all of the Obama administration’s new regulations and red tape.

Post image for Each Chevy Volt Sold Costs Taxpayers Up to $250K, Mackinac Analyst Estimates

James Hohman of Michigan’s Mackinac Center for Public Policy estimates that state and federal incentives for GM’s plug-in hybrid vehicle, the Chevy Volt, total $3 billion. That works out to between $50,000 and $250,000 in taxpayer support for each of 6,000 Volts sold so far, “depending on how many of the subsidy milestones are realized.”

The per vehicle subsidy cost is bound to decrease as more Volts are sold and as current subsidies expire.

Nonetheless, as GM acknowledges, the typical Volt purchaser earns $170,000 a year, so it’s hard to avoid the conclusion that the Volt program is a reverse-Robin Hood wealth tranfer from middle-income households to GM, other big corporations, and high-income auto buyers.

Hohman’s analysis appears below in full. [click to continue…]

Post image for Saving the Climate Change Circus

The Economist Magazine has historically been a supporter of climate-change interventions such as cap and trade and carbon-emission reductions. Yet, they reported on the UN climate change talks in Durban as being more about “saving the circus” than “saving the planet.” But, just what is the “circus;” who are the performers; and how did they get into the ring? And, was it ever about “saving the planet?”

My previous column postulated on China’s role in the climate change “circus.” I suggested that their apparent change of heart on the issue was really just a change of strategy.

Like The Economist, another leading European publication, The Financial Times (FT) has also been a believer in man-made climate change. FT carried extensive coverage of the 2011 UN climate change talks—even producing a twelve-page supplement: Climate Change Review, Durban 2011. Here in the US, the climate change talks in Durban were barely mentioned.

Within FT’s reporting they state that the European Union (EU) “is pushing hardest among developed countries for a new global deal” and is “the greenest voice among wealthy countries at the talks.” Is the EU uniquely insightful, or like China, is their role in the ring also more about economic strategy?

When it is widely known that any Kyoto-style deal will be costly to the countries’ involved and make energy more expensive for the countries’ citizens, why would the EU stand out as the staunchest supporter? Canada has dropped out of the Kyoto accord “in order to save billions of dollars in potential non-compliance fees.” The US never signed on. Developing industrial countries, such as China and India, have repeatedly refused to participate because “rapid development is lifting millions out of poverty.”

Perhaps, herein, lies “the circus”—with the EU as the star performer.

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In The True State of the Planet, Ronald Bailey and colleagues lay out a new environmentalism, one to replace the failed, top-down, government-centric environmentalism of the past. Through innovative and creative thinking, people can solve environmental problems, even ones we don’t know of yet, if they are free to do so.

The True State of the Planet was a project by CEI released in 1995

In 1970, the first Earth Day brought together more than 20 million Americans to launch the first wave of the modern environmental movement. Since then, public concern about the state of the planet has steadily grown. The membership rolls and budgets of leading environmental activist organizations have swollen by millions. The federal government has adopted thousands of pages of environmental regulations. Cities and industries are spending billions every year to clean up pollution…

The first wave has scored some major successes in its twenty-five-year history: in the Western developed world, air and water are much cleaner; automobiles are far cleaner to operate; belching smokestacks are far fewer and generally more efficient than ever before. Clearly developed societies can come together to clean up much of the pollution produced by industries and cities.

But the first wave has also turned out to be spectacularly wrong about certain things. The good news is that many of the looming threats predicted in the early days of the environmental movement turned out to be exaggerated. For example, the global famines expected to occur in the 1970s never happened. Fears that the United States and Europe would cut down all of their forests have been belied by increases in forest area. Global warming, despite so many continuing reports, does not appear to be a major problem. And it turns out that the damages to human health and the natural world by pesticides is far less than Rachel Carson feared it would be when she wrote the Silent Spring in 1962.

It is inevitable, perhaps, that the first wave would begin to run its course and give way to a new strategy… The greatest problem with the first wave has been its solutions, which involve top-down imposition of laws and regulations, some of which, in turn, impair the capacity of people to change their behavior on their own…. Malthus assumed that past behavior would continue into the future. And if behavior does not change on its own, it can be changed only by force—by direct orders from above, as, for example, with gasoline rationing. Americans were ordered to use less oil in the 1970s, and with disastrous results. People hoarded gas; they formed longer gas lines out of fear, and the energy “crisis” was thereby made worse.

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Post image for Issa Challenges Legality of California Greenhouse Gas Emission Standards

I keep coming back to this topic because fuel economy zealots are trashing our constitutional system of separated powers and democratic accountability. Only Congress can make them stop. Leading the counter-offensive is House Oversight and Government Reform Committee Chairman Darrell Issa (R-Calif.), who has been watch-dogging the Obama administration’s fuel economy agenda since 2009. [click to continue…]

Create Wealth, Not Jobs

by David Bier on December 20, 2011

in Blog

Iain Murray and I have an op-ed in The Washington Times this morning that argues that TransCanada’s Keystone Pipeline exists not to create a few jobs from some people, but to create wealth for all Americans:

Spending on construction and infrastructure jobs is a perennial favorite of government stimulus boosters. “There’s no reason for Republicans inCongress to stand in the way of more construction projects,” PresidentObama told an Ohio crowd in September. “There’s no reason to stand in the way of more jobs.” However, the president now wants to block a massive private-sector construction project that would create the thousands of jobs he demands – the Keystone XL pipeline.

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Another Year of Incandescence

by Brian McGraw on December 20, 2011

in Blog

Post image for Another Year of Incandescence

Buried deep in 2012 budget legislation was a paragraph or two that prevents the federal government from spending any funds enforcing the 2007 light bulb efficiency standards/ traditional light bulb “ban” through the end of September 2012. While this isn’t a technical repeal of the ban/efficiency standards, it will allow traditional 100 watt incandescent bulbs to continue to be sold through most of 2012 by those companies who aren’t put off by the negative public relations (green groups may well go on the offensive if national retailers continue to sell them) or potential legal liabilities. It isn’t clear yet the extent to which 100 watt traditional incandescent bulbs will be available for consumer purchase in 2012.

The delay/temporary repeal of the ban has some on the left angry, as Tim Carney notes, though I suspect they’d be angrier if this budget rider had been swapped for delaying implementation of some of the more expensive 2011-2012 EPA regulations, which certainly seemed like a possibility.

An actual argument over the pros/cons of this legislation has been had numerous times and neither side has budged (nor have sides budged over whether or not its okay to label this legislation a ban), so any continuation of that seems sort of pointless. However, I’d like to look at the Politico article that attempted to ding Republicans because “big business” is really upset about this recent turn of events: [click to continue…]