“California’s most disadvantaged communities from Fresno to Long Beach to Richmond to Riverside are already bearing the brunt of the impacts: a historic drought, wildfires of unprecedented strength and 12 million people breathing air that does not meet federal health standards. We must wean ourselves off fossil fuels by investing in cleaner transportation alternatives… [and] keep California’s economy strong and our international climate leadership growing. Stay the course.”
Jerry Brown, Governor, CA
SMALL CHANGES CAN MAKE A BIG DIFFERENCE.
Obama’s Anticlimactic Climate Plan
President Barack Obama’s proposal to reduce power-plant emissions is a historic achievement of relatively modest scope. Understanding this paradox is essential to judging both the rules themselves and the reaction to them.
The reaction first: Industry’s campaign against them began even before they were made public, while the top Republicans in the House and Senate offered their considered judgment within minutes of their release (“nuts” and “a dagger in the heart of the American middle class,” respectively). Assessments in favor, in contrast, are noticeably more restrained.
What explains the discrepancy? Answering that question requires a closer examination of the rules themselves.
Their goal is to reduce greenhouse-gas emissions by 30 percent by 2030. That reduction will be measured, however, from 2005 — and emissions have already fallen by 12 percent since 2005. Even if the plan succeeds, it would have only a slight effect on global emissions.
Carbon Markets 2.0
Yet it’s not quite fair to say the rules are insufficiently ambitious. That’s because, by allowing the states flexibility in how they meet these goals, they could provide a template for future regulation. There’s also something to be said for achievable goals. Not only will a successful plan of its own help the U.S. persuade other nations to reduce their carbon emissions, but it also may bring about technologies that can help the rest of the world do the same.
The rules proposed today by the Environmental Protection Agency would push power producers — the country’s biggest carbon polluters — to use more natural gas and other sources of power, burn less coal and close the dirtiest coal plants altogether. The EPA would offer states four strategies to help them reach these goals.
The first is to get individual power plants to run more efficiently, with lower carbon emissions. (The oldest, least efficient coal plants in the U.S. spew about 30 percent more carbon emissions than the most efficient ones do.) The second is to change the distribution of power generation among existing plants. In other words, lean more heavily on natural gas plants.
The third approach is for a state to derive a greater share of its electricity from noncarbon or low-carbon energy sources, including solar, wind and nuclear. That could mean setting renewable portfolio standards in states that don’t yet have them or, where they exist, making them more aggressive. Ideally, a side effect of such strategies will be the development of much new (exportable) clean-energy technology. Fourth, states can work on lowering consumers’ demand for power.
States can use other strategies as well, and join with other states to pool their efforts. For example, they could create carbon-trading systems such as the one in California or the one jointly operated by nine states in the Northeast.
Many Americans have justifiably grown impatient for federal action on climate change. These new rules are not perfect, and under the best of circumstances could take years to implement. They will almost certainly be challenged in court.
Still, they are the first such restrictions ever to be seriously proposed by an American president. If all goes well, in 2030, the U.S. power sector will emit 33 percent less carbon dioxide than it would if no action were taken. And the U.S. will have provided the world an example of what can be done, not what can’t.
To contact the senior editor responsible for Bloomberg View’s editorials: David Shipley at email@example.com.
Support EPA’s Work to Stop Climate Change
The Environmental Protection Agency (EPA) is collecting comments on its landmark rule to curb carbon pollution from existing power plants—responsible for over 30 percent of the carbon pollution in the U.S.
Carbon pollution is the key cause of climate change and is affecting all our lives now. We must begin to reduce carbon pollution now.
Submit comments to EPA today in support of this critical rule to reduce dangerous carbon pollution. You can send the sample comments below, or edit with your own words for even greater impact.
Investors ask fossil fuel companies to assess how business plans fare in low-carbon future
Coalition of 70 investors worth $3 trillion call on world’s largest oil & gas, coal and electric power companies to assess risks under climate action and ‘business as usual’ scenarios
BOSTON, MA Oct 24, 2013
A group of 70 global investors managing more than $3 trillion of collective assets today launched the first-ever coordinated effort to spur 45 of the world’s top oil and gas, coal and electric power companies to assess the financial risks that climate change poses to their business plans.
Recent studies by the Intergovernmental Panel on Climate Change and the International Energy Agency have suggested that, in order to achieve the international goal of limiting global warming to 2˚C, the world will need to live within a set carbon budget, and a significant portion of proven global fossil fuel reserves will need to be left in the ground.
The world is currently, however, on a path toward global warming of 4˚C or more, which the World Bank warned must be avoided in order to prevent catastrophic climate change impacts.
The investors, most of them based in the United States and Europe, sent letters to the fossil fuel companies last month, requesting detailed responses before their annual shareholder meetings in early 2014. Investors signing the letters include California’s two largest public pension funds, the New York State and New York City Comptrollers, F&C Asset Management and the Scottish Widows Investment Partnership.
The investor effort, called the Carbon Asset Risk (CAR) initiative, is being coordinated by Ceres and the Carbon Tracker initiative, with support from the Global Investor Coalition on Climate Change.
“We would like to understand [the company’s] reserve exposure to the risks associated with current and probable future policies for reducing greenhouse gas emissions by 80 percent by 2050,” the investors wrote in their letter to oil and gas companies. “We would also like to understand what options there are for [the company] to manage these risks by, for example, reducing the carbon intensity of its assets, divesting its most carbon intensive assets, diversifying its business by investing in lower carbon energy sources or returning capital to shareholders.”
According to the Unburnable Carbon report, in 2012 alone, the 200 largest publicly traded fossil fuel companies collectively spent an estimated 674 billion on finding and developing new reserves – some of which may never be utilized. This initiative highlights the opportunity to redirect this capital, rather than it being wasted on high carbon assets that could become stranded.
Germany pledges $1bn to UN climate change fund
Green Climate Fund, designed to help poorer countries deal with global warming, receives boost from Angela Merkel, reports AlertNet
Aid group Oxfam has called on other rich nations to follow the example of Germany, which has promised €750m ($1bn) for the UN’s fledgling Green Climate Fund.
“This announcement ends the deafening silence we’ve had so far around the empty Green Climate Fund that is supposed to support poor countries in the battle against climate change. Now others must follow suit,” Oxfam Germany’s Jan Kowalzig said.
“If rich countries such as the US, France, the UK, Japan and others manage to collect at least $15 billion in pledges ahead of the upcoming UN climate negotiations in Lima at the end of the year, this could give the talks a significant boost,” he added in a statement.
The announcement by Chancellor Angela Merkel on Monday at the Petersberg Climate Dialogue in Berlin, where some 35 ministers from around the world are meeting to discuss international climate action, is the only large pledge of money for the Green Climate Fund so far.
The fund was agreed at UN climate talks in 2010 but has been hampered by wrangling over its design. Now its operating rules have been settled, it will hold a first pledging conference for potential donors in the second half of November, before the UN climate conference in Peru.
Norwegian Foreign Minister Boerge Brende told Reuters earlier this month that Oslo will unveil its preliminary pledge for the fund – a “substantial contribution” – at a summit on climate change organised by UN Secretary-General Ban Ki-moon in New York on 23 September.
The fund aims to help poor nations pursue clean development and adapt to climate change impacts, including more floods, droughts, heatwaves and rising sea levels. It is regarded as a key part of the puzzle in securing a new global deal to tackle climate change due to be agreed in Paris in late 2015.
The fund so far has $55m, mainly for its own administration and to help countries plan to receive the climate finance it will distribute, including $10m from Seoul.
After a recent meeting in Oslo of senior officials from 24 developed and developing countries interested in contributing to the fund, Brende said the process of securing the fund’s first capitalisation had “got off to a good start”.
“Important progress was made in paving the way for pledges this year. I believe we are on the right track towards making the Fund a game changer in the response to climate change,” he said in a statement.
Developing nations say they want $15 billion in pledges from the rich this year to fund projects like solar power, geothermal energy or ensuring water supplies. The UN’s top climate official, Christiana Figueres, has called for “at least an initial $10bn” for the Green Climate Fund.
The fund is expected to channel a large portion of the $100bn a year wealthy countries have promised to mobilise by 2020 to help vulnerable states adapt to climate change and pursue low-carbon growth.
Oxfam’s Kowalzig said rich countries must ensure that money pledged to the Green Climate Fund contributes to rising overall levels of climate finance. At last November’s UN climate talks in Warsaw, governments adopted a decision urging developed countries continuously to boost climate finance through to 2020, he noted.
“So far rich countries have failed to confirm that such increases are actually happening or (are) planned for the future,” he said.
Wealthy governments have provided climate aid worth roughly $10bn a year since 2010, but there are fears that amount may be on the decline at a time of budget austerity.