Becker's Iowa Environmental Law Update : Iowa Environmental Lawyer & Attorney : Charles Becker : Belin McCormick P.C. Law Firm : IA Regulatory Compliance, Site Cleanups

While the discussions in Copenhagen move forward in fits and starts, it appears that serious progress is being made on the home front.  On December 10th, Senators Kerry, Lieberman and Graham held a press conference to announce that they are going to propose climate change legislation designed to garner the necessary 60 (and perhaps more) votes.  Draft legislation was not produced by the trio, but a written statement setting out the framework of the upcoming legislation was provided.  There were three areas of discussion that I found particularly interesting.

First, nuclear power is a go.  John McCain and Lamar Alexander required this and Graham, while discussing it, said that we will need 117 nuclear plants and that "the nuclear power industry represents the best of American jobs that will never go overseas."  It will be interesting to see how much the industry will need to be subsidized to make it viable.

Second, the Midwestern politicians who want assurances that their constituents will not be penalized for having relied on coal for their energy source in the past, will be satisfied.  During the move to cleaner energy, there will be "transitional assistance to households and businesses to ease the shift to a low-carbon economy." In other words, energy costs in the Midwest are not going to be disproportionate to the rest of the country.   

Finally, and most surprising to me, was the declaration by the Senators that they will be "ensuring a future for coal."  In their words:

Our country has plentiful, accessible coal resources and infrastructure.  It is a key component of our current fuel mix. . . .  Coal's future as part of the energy mix is inseparable from the passage of comprehensive climate change and energy legislation.  We will commit significant resources to the rapid development and deployment of clean coal technology, and dedicated support for early deployment of carbon capture and sequestration. 

In no uncertain terms, the Senators are stating that significant support will be given to ensuring that coal will be part of the mix of energy production going forward. Those that like to argue that "clean coal" is an oxymoron have been heard and their position has been rejected.  From a political point of view, it was a bold, and necessary, declaration.

The statements made by Senators Kerry, Lieberman and Graham offer  renewed hope that something will actually get done in the near term.  Extremists have been angling for an opportunity to say that we should blow everything up and just start over because they didn't get what they wanted.  At least these three Senators recognize that that isn't progress, it's capitulation. Now we'll see if they can find another 57 like-minded votes.

RELATED POSTS:  Fairness In Allocating Greenhouse Gas Allowances

                             Will Nuclear Power Be Part Of The Solution?

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“Fairness” is a relative, not an absolute, concept.  If this was not the case, lawyers would be out of a job.  Apparently, this truism can also apply to senators.

With Copenhagen fast approaching, climate change legislation will again be the topic of the day.  Cap-and-trade language, as currently proposed in both the House and the Senate, allocates free CO2 allowances to electrical distributors based on a 50/50 formula; that is, 50% on total emissions and 50% on total energy sales. Under this formula, utilities that are more coal dependent will need to purchase more allowances than they would if the allowances were allocated based only on emissions, and those higher costs will be passed on to their customers.

Fourteen Democratic senators, from coal-dependent, Midwestern states, have written a letter to Senate Democratic leaders requesting that the 50/50 formula be changed to base the allowances solely on emissions.

The effect of using the 50/50 formula is that those states that have historically relied more heavily on coal-fired electrical generation, such as Iowa, North Dakota, Wisconsin, Minnesota, Illinois and Colorado, will pay significantly more for future power, during the transition period to cleaner energy, than under a 100% emissions formula.  The fourteen senators argue that  legislation must equitably distribute transition assistance across individuals, states and regions.  Put another way, they are saying that in this transition period, we should not penalize one group or geographic area, so the 100% emission formula is the "fair" thing to do.

There are, of course, those who disagree.  They argue that the purpose of the legislation is to create financial incentives to switch to lower-carbon fuel sources, so causing higher costs to higher polluting states, is, in fact, “fair” and appropriate.  It is, in their view, not proper to let one group be bailed out for relying so heavily on coal-fired energy in the past.

So who's right?  Like most arguments that address fairness, it all depends on where you stand.

If you believe that cleaner energy is something that had to happen last week and that we must mandate an immediate change, then it would be “fair” to force the higher expense of cleaner energy on one group. If you believe that it will take some time to wean ourselves away from using coal as the primary form of electrical generation (which we have used for more than 125 years), then it would be “fair” to attempt to make the transition less painful as proposed by the senators.

Which view should prevail?  That's for you to decide, but let me add two pragmatic considerations to the mix.

First, despite the best efforts of all concerned, coal will be with us for a long time. It will likely get cleaner but, due to cost and increases in demand for electricity, it will be a significant part of the mix, along with increasing use of solar, wind, geothermal and hydro. In fact, the U.S. Energy Administration expects coal to account for 47% of U.S. electricity in 2030, which is a 2% decrease from the present.

Second, in this age when a Senate majority requires 60 votes, can 14 votes be ignored?
 

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Bipartisan environmental legislation has long been an oxymoron.  This isn't surprising considering how the parties approach the issues.  However, I think it is safe to say that competition knows no political party. That is, whether we admit it to ourselves or not, we all want to win. Since a competitive spirit is a bipartisan concept, why couldn’t Congress learn to use it to its advantage?

I put this question out there because of a recent post in the Wall Street Journal, “Vroom per Gallon: Toyota Prius vs. VW Clean Diesel.” It is an interesting piece about the relative merits of the Toyota Prius and the VW Jetta TDI Clean Diesel. When I finished the article, I was unimpressed with either car (no matter how you paint boring, it’s still boring), but one comment made by the author, Ana Campoy, did catch my attention. Ana said that the Prius has a monitor that tracks energy use and “makes a game out of getting the highest mileage.” She noted that she watches the diagram whenever she drives and that she and her husband have been “trying to beat our personal best for months: an average of 49 MPG.”  She called it the Prius Effect.

I got to thinking about those statements and I realized that she was right. Not too long ago I bought a car that has the ability to monitor the mileage, and now I do so on a constant basis.   Until I bought that car, the concept of miles per gallon was purely theoretical. Certainly I wanted to save gallons because it meant saving money. Did I really change my driving habits to do so? Not for a minute.  But put a gauge in front of me that can be manipulated to go to a higher number if I’m really “good” at driving, and suddenly I’m all about winning . . . uh, I mean, economy. I think you would be too. And more importantly, I think you would be whether you are a Democrat or a Republican.

I should note that, perhaps not surprisingly, my attention to the gauge has made a difference.  After six months, my average has gone up 2 mpg.  Obviously, if that had been a change from 46 to 48 mpg it would have been more impressive than, say, 17 to 19 mpg.  Still, as far as the environment is concerned, the relative change is significant. Multiply this by a few million cars and you've put a big dent in the air pollution problem. 

The age old maxim “out of sight, out of mind,” is one that our elected representatives should consider. If they want to increase car mileage, which depends to a significant degree on driving habits, then don’t hide the information where it is out of sight.  Maybe Congress could interfere a lot less, and still do a lot more, if it considered passing a law that required these kind of monitors.  Why not harness that competitive spirit that knows no party line?

I’ll let someone else crunch the numbers, but I would guess that a fairly modest expense could result in a substantial increase in actual miles per gallon without getting into the political mess of this trading caps thing.  I can just see the new slogan at General Motors -- GM: You Can Watch The Savings!

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