“California’s Cap-and-Trade Revolt” – Wall Street Journal, 30 June 2014

While West Virginia and Kentucky Democrats are bucking Obama’s climate policy, California Democrats are also fighting similar policy in California, the state’s cap-and-trade program, which is directly effecting the poorest Californians.

Recently, 16 of members of California’s Democratic Assembly wrote a letter to the California Air Resources Board, encouraging the board to revise or postpone California’s cap-and-trade program. The program calls for big manufacturers and power plants to adhere to a state-ordered carbon cap by buying carbon permits or limiting emissions. Transportation fuel suppliers will also have to acquiesce to permits in 2015.

via SF Public Press

via SF Public Press

Assembly Democrats’ minds are on gas prices, which could surge anywhere from 15 to 40 cents per gallon. California has the highest gas prices in the country, in large part due to fuel blending obligations and taxes. In 2012, the Boston Consulting Group anticipated that gas prices would rise anywhere between $0.49 and $1.83 per gallon by 2020. While the program’s objectives are pure—boosting gas prices is supposed to persuade people to drive less, carpool, or purchase electric cars—California’s cap-and-trade is invariably hurting those who cannot afford it. A majority of the 16 Democratic Assembly Members represent minorities and low-income populations.

The Air Resources Board maintains that the objective of the program isn’t to finance new state governmental programs, though California’s 2014 budget does allocate $250 million from carbon permit auctions, as well as 25 percent of future yields, to fund a high-speed rail. The auctions will bring in anywhere between $12 billion to $45 billion by 2020.

Assembly Democrats are in agreement with the California Chamber of Commerce, which is suing the Air Resources Board to invalidate California’s program.

Developed and Written by Dr. Subodh Das and Tara Mahadevan

June 30, 2014

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“Coal: The fuel of the future, unfortunately” – The Economist, 19 April 2014

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The Economist

While natural gas has been waging a war on coal, coal will likely persist as a serious player in the energy market. Coal is inexpensive, plentiful, and easy to mine, ship, and burn. It is a cheap energy source for developing countries, and a great way for these countries to become rich.

Still, the issue remains that coal is not a clean energy source. Mining, transporting, storing and burning coal is a dirty job; underground mining can cause health issues for miners. Transporting coal has negative environmental impacts; opencast mining, a surface mining technique, destroys topsoil and devours water supplies. Coal is the biggest single source of pollution in the world, expending one-third of the world’s carbon dioxide emissions.

The US is experiencing a large shift away from coal and towards natural gas. Many big US coal companies, like American Electric Power and Duke Energy, are closing coal-fired plants. Yet, the Energy Information Administration (EIA) reports that coal will still be producing 22% of the US’s energy by 2040. Coal currently produces 26% of the US’s energy. China, the world’s biggest pollutant, is trying to restrict its coal consumption, but developing countries like Africa and India are picking up where China has left off. In Germany, coal is the cheapest it’s ever been. Japan, too, has recently authorized a new energy plan that has solidified coal’s role as the country’s main energy source.

Besides these boons for coal, international coal companies should still be worried for two reasons: one, that governments will place restrictions on coal; and two, the global oversupply of coal, which has pushed prices down and caused some coal companies to lose profits.

Still, coal remains a worthy adversary to oil and gas. Coal mining doesn’t necessitate expensive equipment, like drills, platforms and pipes, and when prices drop, companies can stop manufacturing and wait until prices pick back up.

Technological advances for producing clean coal—pulverizing coal, separating the gas from coal, scrubbing emissions and capturing carbon dioxide—look promising, though the methods are costly. A $5.2 billion clean-coal plant is being built in Mississippi, which was entirely funded by taxpayers. This will be the most expensive power plant ever completed, so we can probably safely assume that clean-coal plants won’t be the norm any time soon.

Developed and Written by Dr. Subodh Das and Tara Mahadevan

April 20, 2014

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“Pipeline Fight Lifts Environmental Movement” – New York Times, 24 January 2014

Since June 2011, environmentalists have been rallying together to stop the approval of the 1,700-mile Keystone XL pipeline — XL meaning express line — which would send 800,000 barrels a day of crude oil from Canada sand formations to Texas refineries. Though it is unknown if Obama will authorize the project, environmentalists have taken their protests directly to the him.

In addition to transporting hundreds of thousands of barrels of oil per day, the pipeline will also involve an oil extraction process that expends more greenhouse gas emissions than any other means of production. Those in favor of the pipeline say that the oil will be transported regardless; without the pipeline, it would probably be carried by railway, which would cause more pollution.

The pipeline has been an issue that has banded all American environmentalists together, allowing climate change organizations, like 350.org, to grow to double its size in just two short years. People from all economic and financial backgrounds have donated time, energy and money to the cause, merging national and grassroots environmental groups who often argue over attention and resources.

Keystone XL would create a bypass to the Gulf of Mexico and would expand TransCanada’s current Keystone pipeline, which runs from Alberta to Nebraska, Illinois and Oklahoma; Keystone XL would be a more direct pipeline across the US, to Texas. TransCanada and ally American Petroleum Institute have taken the matter into their own hands by running TV and radio ads advocating the many jobs the pipeline will create.

Whether environmentalists’ protests are successful or not, it is easy to agree that the pipeline issue has forever changed American environmental politics, allowing various environmental groups to rally together, and forming a durable infrastructure.

Developed and Written by Dr. Subodh Das and Tara Mahadevan

January 31, 2014

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“A Clean Car Boom” – New York Times, 11 August 2013

Sales of hybrid and electric cars are growing faster than expected, mostly due to cutting edge technologies and helpful government policy.

Twenty-eight percent of the US’s greenhouse gas (GHG) emissions derive from transportation, second to power plant emissions. Wider use of fuel-efficient cars has already curbed the 2005-2012 carbon dioxide emission rates by 16%.

In the first seven months of 2013, car manufacturers sold over 350,000 hybrid and electric cars, a 30% gain in sales from the same time, the first seven months, in 2012. Hybrid and electric cars are classified as light vehicles; and although they only comprise 4% of that classification, they have become very mainstream and accessible to the public. The Toyota Prius is the most popular hybrid car, and one of the 10 best-selling cars in America.

Unlike hybrids, electric cars are still a fairly specialized product, more often purchased by wealthier buyers. However, federal and state tax rebates are boosting sales by giving more people the opportunity to buy electric cars. Tesla Motors manufactures the best selling electric car, the Model S; other companies like BMW and Cadillac are following suit.

The federal government’s 2010 mandate that obligates car manufacturers to double new-car average fuel economy by 2025 has propelled the car industry to produce more fuel efficient cars at a faster rate; Obama’s loan guarantees to renewable energy and electric car companies have also accelerated car manufacturers’ timelines. Tesla has made enough money from its hybrid and electric cars to pay off its $465 million loan, nine years early.

Read our previous entry on fuel efficient trucks, GM planning strict diet for new pickup trucks.

Developed and Written by Dr. Subodh Das and Tara Mahadevan

August 30, 2013

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