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On April 21st, the Environmental Protection Agency and the U.S. Army Corps of Engineers proposed to “clarify” federal jurisdiction pursuant to the Clean Water Act. Logically, the purpose of a regulatory interpretation is to elucidate the rules of the game. EPA’s/USACE’s rule, alas, does the exact opposite. Instead of clearly defining the limits of federal authority, the proposal would establish a haphazard regime whereby a regulator would determine, on a case-by-case basis, whether a given body of water possessed a “significant nexus” to navigable waters and were therefore subject to federal power. In practice, the test is so amorphous that every ditch, vernal pond, playa lake, mudflat, sandflat, and slough could easily fall under the EPA’s jurisdiction.

“waters of the U.S.”

Indeed, the rule is so expansive that it could claim storm water sewer systems as “waters of the United States”! This presents a cosmic irony, insofar as storm water sewer systems are themselves pollution control mechanisms. This regulatory closed loop–i.e., the regulation of a means of regulatory compliance–was aptly described by National Association of Counties’ Dusty Williams  in June testimony before the House Transportation and Infrastructure Committee. [click to continue…]

There’s a strong current of contemporary thought which posits that “doing something” about climate change is compatible with robust economic growth. And it’s not just environmental lobbyists spouting off about “green jobs”; no less an eminence than Nobel Prize winning economist Paul Krugman has averred that,

Climate despair is all wrong. The idea that economic growth and climate action are incompatible may sound hardheaded and realistic, but it’s actually a fuzzy-minded misconception. If we ever get past the special interests and ideology that have blocked action to save the planet, we’ll find that it’s cheaper and easier than almost anyone imagines.

Recent Japanese history presents a grand, albeit tragic, case study into whether greenhouse gas emissions and economic growth have indeed decoupled. In addition to being a humanitarian and ecological disaster, the 2011 Fukushima Daiichi nuclear power plant crisis also spawned an energy crunch. A significant amount of supply, the equivalent of 9 average-sized American coal power plants, was lost in the disaster.

Before the Fukushima incident, Japan had been at the forefront of global climate change mitigation policy. As such, it is safe to presume that Japan in 2011 possessed a mindset to replace its lost nuclear capacity with low/no-carbon energy. Accordingly, in the immediate wake of the meltdown, Prime Minister Naoto Kan emphasized that solar and wind power would meet the country’s demand.

So, in mid 2011, we had a green-minded, developed country in need of energy overhaul. Thus, Japan’s post-Fukushima experience offers an opportunity to test Prof. Krugman’s thesis. If fighting climate change is cheap and easy, then Japan should’ve gone green. [click to continue…]

The New York Times last weekend took note of *skyrocketing* utility bills in New England. According to the paper of record,

For months, utility companies across New England have been warning customers to expect sharp price increases, for which the companies blame the continuing shortage of pipeline capacity to bring natural gas to the region. Now that the higher bills are starting to arrive, many stunned customers are finding the sticker shock much worse than they imagined.

New England ratepayers are suffering primarily due to the fact that the regional grid (known as the “ISO-NE”) has undergone tectonic shifts over the last decade, as the region’s fuel mix has shifted dramatically from coal and oil to natural gas. In 2000, coal, oil, and natural gas provided 18 percent, 22 percent, and 15 percent (respectively) of total electric production in ISO-NE; in 2013, coal, oil, and gas provided 6 percent, less than 1 percent, and 46 percent.

It’s not that over-reliance of natural gas, per se, has caused utility bills to blow up; after all, gas is plentiful in the region, thanks to the nearby Marcellus shale, where gas production is booming due to the “fracking” technological breakthrough. Rather, the problem is constraints in gas pipeline capacity. There’s too much demand for gas, and too little infrastructure to deliver the gas. The logistical shortfall is especially pronounced in the winter, when gas demand for power competes with demand for space heating.

In fact, such supply chain bottlenecks historically have been a difficulty commonly attendant to central planning, and, in this vein, environmental policy (at both the State and federal levels of government) has been a major impetus for the recent dramatic shift in fuel resources in New England. Simply put: In a fit to go green, the region went too fast, too soon.

The region thus offers a lesson for the nation as a whole, because EPA’s Clean Power Plan similarly would overhaul overnight the U.S. electricity business. This comparison—between what New England is enduring now and what America could expect given the Clean Power’s implementation—recently was made by FERC Commissioner Tony Clark in response to written questions posed by the Energy and Commerce Committee: [click to continue…]

Two weeks ago, the New York Times warned that humankind faces “extinction” unless the international community reached a diplomatic breakthrough at the 20th Conference of the Parties to the United Nations Framework Convention on Climate Change in Lima Peru. Despite these dire stakes, the Lima climate confab wrapped up this weekend  with yet another empty agreement—thereby dooming human civilization, if the Grey Lady is to be believed—and not a single Sunday network news talk show gave any airtime to COP-20. Indeed, nary a single powerhouse roundtable even mentioned climate change. Thus, it would seem that networks give as little priority to climate change as do American voters. This is why opposition to climate change mitigation policies is healthily bipartisan in the U.S. Congress.

Moving on to stories that actually made the news, the highlight of this Sunday’s (invaluable) Platts Energy Week with Bill Loveless was an informative and wide-ranging interview with Platts Senior Editor Brian Scheid regarding new North Dakota regulations for the volatility (i.e., combustibility) of oil produced and transported in the State.

Finally, I’ll conclude by posting Youtube video (after the break) of Greenpeace activists damaging the Nazca lines, a cultural landmark in Peru, in an effort to promote green energy at COP-20. As reported by the New York Times, you can hear “their shoes crunching over the dry ground.” That is, you can hear them desecrating the site, which was designated a World Heritage monument by UNESCO. Peruvian authorities are outraged by the stunt, but the activists skipped town to avoid prosecution, according to the Times. [click to continue…]

From a citizen perspective, there are three main questions in climate change science: What happened? Who done it? How bad is it going to get? Those questions roughly correspond to the scientific issues of detection, attribution, and climate sensitivity.

All scientists, including skeptics, agree with the IPCC’s assessment that warming of the climate system since the 1950s is “unequivocal.” In contrast, IPCC climate sensitivity estimates are increasingly controversial due to the growing divergence between climate model projections and observed temperatures. The chart below by University of Alabama in Hunstville (UAH) atmospheric scientist Roy Spencer illustrates — and satirizes — the divergence:

Earlier this week, I reviewed a comment letter by Spencer’s colleague John Christy  on the scientific basis of EPA’s Clean Power Plan. To recap, EPA’s climate change endangerment analysis is largely based on IPCC climate models. Christy challenges not only the IPCC’s climate sensitivity estimates, but also the IPCC’s claim that most warming since 1951 is anthropogenic. That “attribution” assessment is the core of what IPCC-affiliated scientists and their allies call “the consensus.”

Today’s post offers an historical perspective on Christy’s critique of the consensus position. [click to continue…]

It was Climate Action Day at the UN climate conference in Lima, Peru.  A three-hour “high level” session featured a number of prominent elected leaders, UN officials, and climate activists. It gave me a chance to hear former star of stage and screen Al Gore twice more.  Gore said that, “We are designing the future of humankind here in Lima and then Paris” next year.  If that isn’t scary enough, U. S. Secretary of State John Kerry flew in a few hours later to give a speech in the main press conference room.  It wasn’t an official speech to the COP, but was meant to show the delegates and the world that the Obama Administration is determined to make the negotiations succeed.

Chief State Department climate negotiator Todd Stern introduced his boss.  He said that Secretary Kerry as a Senator had attended nearly every important international climate meeting beginning with the Rio Earth Summit in 1992. It was at that summit that nations agreed to save the world from global warming by signing the UN Framework Convention on Climate Change. After President George Bush signed it in June 1992, the Senate ratified it with little debate that fall, thereby making the U. S. the first country to ratify it.  Stern went on to say that Kerry as Secretary of State pushes the climate issue with every foreign leader he meets with.  That meshes with Kerry’s claim that climate change is “perhaps the world’s most fearsome weapon of mass destruction.”

Secretary Kerry then gave an articulate but intellectually sloppy speech.  He began by noting that Al Gore, who was seated in the front row, had been warning about global warming since 1992 and yet he woke up this morning to the news that California and Washington state were experiencing torrential, record-setting rains after a record drought.  Kerry said that the science is screaming at us, and it’s therefore astonishing that we have people in the Senate who continue to doubt it.  You don’t need a Ph. D., he said, to see that the world is changing.

[click to continue…]

According to CNBC, Treasury Secretary Jack Lew today told an audience in New York that low oil prices are “like a tax cut to the economy” and that increased U.S. oil and gas production is a “great success story.”

However, only a few hours after Treasury Secretary Lew praised low oil prices, Secretary of State John Kerry championed an altogether different viewpoint in an address to the 20^th Conference of the Parties to the United Nations Framework Convention on Climate Change in Lima, Peru. I don’t yet have a transcript of his speech, but per the Twitterverse:

John Kerry is finding any number of ways to say that lower cost oil has high costs. #cop20 #climate #UNFCCC

— Ben Geman (@Ben_Geman) Decemb

and

John Kerry on the hidden costs of cheap power of coal & oil: “It’s not cheaper.” #cop20

— Lisa Friedman (@LFFriedman) December 11, 2014

[click to continue…]

With the 1935 Federal Power Act, Congress sought to establish a “bright line” between federal and state jurisdiction over the electricity market. Generally, federal regulators (at the Federal Energy Regulatory Commission) have authority over the interstate transmission and sale of electricity, while States retain exclusive jurisdiction over the regulation of generation and also retail electric sales. See Federal Power Commission v. Southern California Edison Co., 376 U.S. 2015 (1964) at 215-216.

Of course, the electric industry has changed a great deal in the 80 years since Congress passed the Federal Power Act. Of particular note, FERC over the last 2 decades has sought to facilitate more robust interstate electricity markets. As a result of this and related dynamics, the “bright line” between state and federal jurisdiction has dimmed, such that it’s far less clear where lie the boundaries between these two co-sovereigns.

In a very smart segment during last Sunday’s Platts Energy Week with Bill Loveless, posted immediately below, Platts’s Bobby McMahon reports on a series of court cases that have the potential to dramatically clarify the limits of state and federal oversight of the electricity industry. After the break, I explain the matter further.