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Environment
Monday, March 16, 2009
Boosting the Business Climate by Delaying Cap-and-Trade
Posted by Richard S. Davis on 3/16/2009 2:58:00 PM
At this time, the governor's ambitious cap-and-trade legislation is headed nowhere, which counts as a victory for the business climate, whatever you might think of its dubious merits as a climate change vehicle. Warren Cornwall has a good story on the politics in the Seattle Times.
House Speaker Frank Chopp, D-Seattle, said many fellow Democrats
voiced concern about the economic toll new regulations could take on
businesses already shaken by the recession. He also has heard doubts
about a market for pollution permits.
"With what's happened in the last year, one would wonder about the
wisdom of the markets," Chopp said. "Remember energy deregulation?
Well, that didn't turn out so well."
A February WashACE report challenged the economic modeling relied on by cap-and-trade promoters and estimated the proposed system would have imposed nearly $3 billion in new costs on Washington businesses by 2020.
Cornwall quotes AWB's Grant Nelson:
"Especially given the economic crisis that is facing Washington, the
Legislature has shown leadership and understanding in moving forward
this session on climate-change legislation in a more responsible
manner," said Grant Nelson of the Association of Washington Business,
which opposed Gregoire's legislation.
Right. Seattle's two major dailies both argue that the state should have jumped the queue and passed legislation ahead of the national consensus.
If Washington's economy is perceived to be too vulnerable to move
ahead, the governor and legislative leaders need to say so. Is more
time needed to perfect a workable plan, or is this a big step backward?
Yes, the economy is too vulnerable. And yes, more time is needed to perfect a workable plan. Nope, not a step backward, just a responsible recognition of economic reality.
But it seems that many Democrats in the Legislature are green posers
who talk a good game but turn a cowardly shade of yellow when action is
needed.
I think it took courage for Democratic leaders to stand up to their green constituents and refuse to engage in an irresponsible rush to regulate.
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Tuesday, February 24, 2009
Can't Count Coal Out
Posted by Richard Davis on 2/24/2009 4:56:00 PM
Don Brunell's column this week offers up another of what used to be called inconvenient truths, until Al Gore made it such a tired cliche we don't say it anymore. Brunell points out that coal will long be an essential element in our nation's energy supply. ..coal provides more than half of our nationƒ?s electricity and will for at least the next 20 years. There wonƒ?t be enough alternative energy for decades ƒ? if ever ƒ? to replace it.
Still, as he points out proposed legislation threatens only coal-fired power plant. Here's how Sen. Craig Pridemore explains his position on YouTube.
Read Don's post. He's right. The senator is wrong.
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Tuesday, February 17, 2009
How Green is the EU? How Much Does it Matter?
Posted by Richard Davis on 2/17/2009 1:50:00 PM
According to this article in Business Week, European renewables mandates have successfully launched a green economy. But, they've not been much less successful at cinbatung climate change. ...wind turbines and solar energy plants are revolutionizing Germany's mix of power sources, creating jobs and making the country more independent from imports. But they aren't helping in the fight against climate change. In the worst case scenario, sustainable energy plants might even have a detrimental effect on the climate. As more wind turbines go online, coal plants will be able to reduce their output. This in itself is desirable ƒ? but the problem is that the total number of available CO2 emission certificates remains the same. In other words, there will suddenly be more certificates per kilowatt of coal energy. That means the price per ton of CO2 emitted will fall. That is exactly what happened in recent trading.
H/T Don Brunell at Olympia Business Watch, who asks:
So, if Washington, which is one of 11 participants in the Western Climate Initiative (WCI), joins California in passing a "cap and trade" bill along the lines suggested in the WCI accords and neighboring Idaho, only an observer of WCI, takes a pass, will the same thing happen here?
Probably.
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Monday, February 16, 2009
Contrasting Views on Climate Change
Posted by Richard Davis on 2/16/2009 12:21:00 PM
Friday, the Seattle PI carried yet another editorial urging lawmakers to pass the governor's climate change cap-and-trade legislation. There are, of course, plenty of good reasons to delay. Yet, the PI says:
Smart policymakers will choose to confront what science is telling us about how global change will hurt the state.
The absolute certainty in science expressed there made this George Will column timely. He riffs on the "global ice age" predicted thirty years ago, citing a number of examples where environmental doomsayers have been, well, off the mark. Read the whole thing.
He also cites a rule with which I was unfamiliar. ...Gregg Easterbrook's "Law of Doomsaying": Predict catastrophe no sooner than five years hence but no later than 10 years away, soon enough to terrify but distant enough that people will forget if you are wrong.
Of course, if we pass economy-killing regulations based on flawed science, people are unlikely to forget in five, ten, or twenty years. However you feel about it, there's no reason for Washington to rush ahead of national policy.
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Tuesday, January 20, 2009
Renewing Renewable Energy Incentives: New WashACE Competitiveness Brief
Posted by Richard Davis on 1/20/2009 4:04:00 PM
Our state's commitment to renewable energy generation enjoys substantial public support. In the last decade, the nascent industry has been nurtured and encouraged by a tax incentive exempting
producers from local and state sales and use taxes for the purchase and installation of machinery and equipment used in generating electricity from wind, solar, landfill gases and fuel cells. The exemption is up for renewal this year. This WashACE Competitiveness Brief, prepared for us by The Simeon Partnership, examines the role of renewable energy and the importance of maintaining the current tax exemptions. The bottom line: Extending these tax exemptions will help Washington maintain its competitive advantage in energy pricing and, therefore, contribute to a competitive business climate.
It's hard to see how the state could meet the I-937 renewables targets without the exemptions in place.
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Monday, August 25, 2008
How Much Would You be Willing to Pay to Combat Climate Change?
Posted by Richard Davis on 8/25/2008 4:27:00 PM
Not much if you're a typical Californian. And are they so much different from typical Washingtonians? Here's the Reuters story on a recent survey. Most Californians won't support the state's ambitious efforts to fight global warming if they lead to sharply higher energy costs, according to a survey commissioned by a pro-business group released on Thursday. Sixty-three percent of 1,000 registered California voters surveyed this month said they supported the goal of cutting greenhouse gases, but that support fell to 47 percent when the question included the likelihood of higher energy costs.
Power Line understands the dissonance. Reducing carbon emissions will be popular until someone actually tries to do it, and the consequences become apparent. It's a bit shocking that, as this survey suggests, a considerable number of people don't understand that reducing carbon consumption means higher energy costs.
Right.
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Friday, June 06, 2008
Lieberman-Warner Climate Security Act Killed
Posted by Richard Davis on 6/6/2008 5:06:00 PM
It's gone for now. The National Association of Manufacturers says that clears the way for something better. And anticipating the bill's defeat, The Foundry blog at The Heritage Foundation says critics of the massive cap-and-trade trillion dollar tax hike should learn from their success. Basic lessons: Get the economics and the science right. Lieberman-Warner cost way too much and would have done little, if any, good. It, or something much like it, will be back. Oddly, most of what I read cites "bipartisan support" for the legislation, but bipartisan opposition seems to have been the defining factor.
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Wednesday, June 04, 2008
Enough Talk About Climate Change to Fill Trial Balloon
Posted by Richard Davis on 6/4/2008 2:41:00 PM
Yesterday, the U.S. Senate took up the Lieberman-Warner Climate Security Act of 2007. The "Director's Blog" at the Congressional Budget Office reports on the cost. Here's the April 10 estimate on the bill. CBO estimates that enacting S. 2191 as it was ordered reported would increase revenues by about $1.2 trillion over the 2009-2018 period. Over that period, we estimate that direct spending from distributing those proceeds would also total about $1.2 trillion, but more than the revenues. ... In addition, assuming appropriation of the necessary amounts, CBO estimates that implementing S. 2191 would increase discretionary spending by about $4 billion under the original legislation and about $80 billion under the amended version over the 2009-2018 period.
Big numbers to fight over. But no one expects anything to happen soon. Not the supporters at Global Warming is Real (with lots of nice Green links). Not the critics at this Wall Street Journal blog,which provides a nicely condensed outline of what to watch. The stakes are high. Our state legislature recently passed a major climate change bill that sets the stage for a cap-and-trade program. In today's Wall Street Journal Robert Reich, who likes cap-and-trade and agrees with most of the world that the Lieberman-Warner bill is going nowhere, outlines how Senators Obama and McCain agree and differ on the issue. The Heritage Foundation calls Lieberman-Warner a solution worse than the problem. The Seattle Times editorializes that legislation is overdue, but they acknowledge the effects High in the senators' consideration should be how to minimize the inevitable increase in costs not just in energy but in goods and services because of higher energy costs ƒ? or at least to spread the burden fairly.
Although details matter mightily, the public generally supports action to address climate change, without bothering much with the details. For businesses in our state, this is a critical competitiveness issue. While the trial balloons may just be filling with hot air now, eventually they may reach liftoff. Here's my take on gas prices and climate change in today's column in The Herald.
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