The Nissan Leaf ZEV: Coming Soon to a California Street Near You. Maybe.

Yesterday, the California Air Resources Board significantly toughened the state’s regulations on carbon emissions from automobiles:

The package of Air Resources Board regulations would require auto manufacturers to offer more zero- or very low-emission cars such as battery electric, hydrogen fuel cell and plug-in hybrid vehicles in California starting with model year 2018.
By 2025, one in seven new autos sold in California, or roughly 1.4 million, must be ultra-clean, moving what is now a driving novelty into the mainstream.
The board also strengthened future emission standards for all new cars, making them the toughest in the nation. The rules are intended by 2025 to slash smog-forming pollutants from new vehicles by 75 percent and reduce by a third their emissions that contribute to global warming.

Two quotes from the article stood out.  First, an analyst from Kelly Blue Book argued that “the added expense and lesser versatility of the ‘environmental’ vehicles” will continue to make them less desirable to consumers. Manufacturers might have to sell clean cars at a loss to meet the requirements, and “buyers of conventional cars will pick up the remainder of the tab.”  Assuming that he is right — and I think it is too early to know for sure — this would simply make the new rules a sort of privatized form of a carbon tax.  Buyers of less-clean cars would pay a premium based on the greater emissions from their vehicles.  The difference is that the beneficiaries of the levy are private automakers, not the government.

Second, the spokeswoman from the Alliance of Automobile Manufactuers complained that “[a]utomakers are mandated to build products that consumers are not mandated to buy.  If the electric vehicle infrastructure is not in place, consumers may be reluctant to buy these technologies.”  My first reaction is to say: cry me a river.  The reason why California is adopting a mandates approach stems in no small part from the anti-tax theology of the Republican Party, which the automakers have done nothing to stop.  Even with their recent troubles (and more recent success), they remain some of the biggest and most influential businesses in the state and the nation.  They have sat on their hands as the Jarvis hysteria gripped the state.  So now CARB uses a mandate instead of a regular carbon tax, which would be easier for the automakers to adapt to.  If they don’t like these rather clunky regulatory methods, then they should understand where they come from instead of whining.

That being said, there does seem to be a chicken-and-egg problem with developing zero-emission-vehicle infrastructure.  If developing this infrastructure is costly, then developers will hesitate to do so unless they have some idea of how much demand there is.  But demand, in turn, might lag until and unless consumers know that there is adequate infrastructure.  Costly infrastructure would seem to require a government response.  But of course we can’t have that.

Electric car recharging infrastructure, however, might not be so costly.  Perhaps recharging an automobile takes up less space and creates fewer localized impacts than, say, a gasoline service station.  If that is the case, then the market might be able to handle the problem if it is allowed to operate.  Since local land use is by far the most over-regulated sector in the economy, the state legislature – or CARB, if it has the authority — might move to pre-empt local restrictions on recharging infrastructure.  CARB staff seems to have thought through many of these policies carefully: developing electric car infrastructure would figure to be the next phase.

The other story is a cautionary reminder of the forces attempting to squelch scientists.  This story is about the creation of a legal defense fund for scientists.  Those who work on climate issues are now beset by death threats and law suits.  The legal defense fund seems like a great idea, given the circumstances. But what does it say about the current state of affairs that scientists need defending from threats and legal harassment?

Strangely, the same talent and passion for knowledge make Americans admire Samantha Garvey could someday subject her to legal harassment and even death threats, if her work as an environmental scientist violates political dogmas. That’s a peculiar state of affairs, and a sad one.

So, there are 16  scientists who are not convinced by the current evidence.  Peter Gleick offers his thoughts on the piece here.

Here is one of the quotes from the OP-ED.

“If elected officials feel compelled to “do something” about climate, we recommend supporting the excellent scientists who are increasing our understanding of climate with well-designed instruments on satellites, in the oceans and on land, and in the analysis of observational data. The better we understand climate, the better we can cope with its ever-changing nature, which has complicated human life throughout history. However, much of the huge private and government investment in climate is badly in need of critical review.”

How does science make progress?  Is there the equivalent of Einstein’s eclipse that can settle some of these issues?  What data would allow us to reject a hypothesis with confidence?

This extraordinary process is being carried out under the federal Magnuson-Stevens Act, enacted by Congress in the 1970′s and quietly reauthorized five years ago. Little noticed in the recent reauthorization legislation was a provision–supported by a bipartisan coalition of legislators, environmental organizations, scientists and some fishing groups–requiring federal regulators to establish annual catch limits for each U.S. fishery. This new mandate, in turn, was prompted by the well-chronicled overfishing of many fish species that have caused numerous commercial and recreational fish populations to plummet.   According to Joshua Reichert of the Pew Environmental Group, this new provision of the Magnuson-Stevens Act “is probably the most important conservation statute ever enacted into America’s fisheries law.”

The federal process to set broad catch limits was initiated by the George W. Bush Administration, and has continued apace under the Obama Administration. One of the key features that distinguishes this process (and which may account for its relative lack of political controversy) is that development of the fisheries catch limits has been a “bottoms-up” process: those limits have been established by decentralized, regional management councils representing a diverse set of local interests.

Nevertheless, ultimate responsibility to ratify and enforce the newly-established catch limits rests with federal officials at the National Oceanic and Atmospheric Administration and elsewhere. And those officials have indicated they plan to have annual catch limits in place for all 528 targeted fish species by the end of 2012.

Unsurprisingly, the transition of national catch limits from aspiration to reality threatens the fragile, bipartisan political support that has previously characterized the regulatory process. Some commercial and recreational fishing interests are belatedly arguing that the regulatory process lacks adequate scientific data to support the impending fishing restrictions. And some of their congressional supporters–ranging from conservative Republicans to progressive Democrats such as Massachusetts Senator John Kerry–are urging Congressional intervention to block or loosen the new catch limits.

Islands within Gulf of the Farallones National Marine Sanctuary

International fishing interests are especially nervous about the Obama Administration’s pending action on the fisheries front: the U.S. catch limits would be the first such restrictions anywhere on the planet. But other countries including the European Union nations have expressed interest in following America’s lead.

The $64,000 question, of course, is whether the proposed U.S. fisheries catch limits will be formally adopted and enforced or if, like most other federal environmental programs, they will sink into the morass of partisan D.C. politics and special interest lobbying. Stated differently, will the proposed Magnuson-Stevens Act-based fishing restrictions serve as a model of the bipartisan, science-based environmental policy President Obama advocated in this week’s State of the Union address? Or will it founder in the political gridlock of Washington like so many other recent environmental policy initiatives?

So, my colleague is making a strong causal statement that the same person would be much healthier if he/she lived in a “new urbanist” setting rather than in the types of suburban settings that many people current live in.    As an empiricist, I ask myself — how do we rigorously test this hypothesis? It is an important hypothesis to test.  

There is one high quality study done by economists to examine the relationship between sprawl and obesity.   These authors studied the weight dynamics for individuals who moved from center cities to suburbs.  Under the Jackson hypothesis, this group should gain weight relative to observationally similar people who do not move.  These authors reject that hypothesis.   To really test causal claims about the role that urban form plays in determining outcomes, we need a randomized control trial.  Since we choose (i.e self select) our locations , there are fundamental selection vs. treatment issues that need to be disentangled here.  This is an exciting research field with opportunities for methodological advance and it is important public policy question as we think about what are the consequences of policies such as California’s SB375.

We can also spur energy innovation with new incentives. The differences in this chamber may be too deep right now to pass a comprehensive plan to fight climate change. But there’s no reason why Congress shouldn’t at least set a clean energy standard that creates a market for innovation. So far, you haven’t acted. Well tonight, I will. I’m directing my Administration to allow the development of clean energy on enough public land to power three million homes. And I’m proud to announce that the Department of Defense, the world’s largest consumer of energy, will make one of the largest commitments to clean energy in history – with the Navy purchasing enough capacity to power a quarter of a million homes a year.

Economists are found of paradoxical arguments, like the rebound effect or the claim that safer cars cause more deaths. (I’m not making up the auto safety claim.) Sometimes economists seem to be living n a kind of Bizarro World, where the best way to accomplish any goal is always to do the opposite. Making these claims takes a certain ingenuity, because there’s nearly always some feedback effect that tends to push back against the direct effects of a policy.  There are also feedback effects that strengthen the impact of a policy, but those are less fun to point out.  For instance, energy efficiency makes people better off economically, and the environmental Kuznets Curve holds that more affluence produces greater demand for pollution regulation, which will result in less use of dirty fuels such as coal and thereby cut carbon emissions.

The big issue is the size of the feedback effect, and that’s very difficult to establish empirically.  The problem is that determining the effect of an event such as a policy or technological change requires holding everything else constant.  Since other things rarely are constant, an empirical study has to estimate what would have happened in a world in which everything except the policy change was the same.  Not easy to do!

I’d like to suggest the relevance of two economic axioms to this debate.  One is familiar: there’s no free lunch.  Even something as seemingly desirable as improved energy efficiency does not come without some price.  The other is less familiar (because I just made it up): you can’t lose weight by eating more.  Call that the “no miracle diet” rule.  This means that the direct effects of an action are rarely completely negated or reversed by feedback effects.  Rarely does not mean never, but there’s a strong burden of proof on anyone who wants to argue for such exceptionally strong feedback.  In the case of energy efficiency, that means that the presumption should be in favor of the common sense conclusion: greater energy efficiency means less energy use.

Now, Greenpeace is trying to get K-Mart to ban AP&P products from its shelves.  You can sign the petition here.

I don’t always agree with Greenpeace’s positions and tactics, but they are absolutely right on this one.

Abstract. Climate change presents us with a pressing challenge. A global consensus accepts that
human activity is responsible for climate change and its associated dangers. However, there is
disagreement on how best to address this challenge. The essay argues that leading proposals are
unsatisfactory, such as the ecological footprint and polluter pays principle. The reasons include
that they do not effectively manage climate change and may contribute to further problems. We
require a new approach to address climate change.

He reproduces a couple of quotes from my Climatopolis and I would like to add a couple of thoughts.

My book focuses on the micro economics of climate change adaptation and the role that urban growth will play to help us to adapt.   I do not view adaptation to be a substitute for mitigation.  In the book, I talk about my support for $10 a gallon gas. I would love to see a carbon tax of $50 per ton of CO2 right now but I am a realist.  Such policies will not be enacted and the stock of GHG emissions will continue to rise. I hope that the Green Guinea Pig efforts such as California’s AB32 teach us new lessons that then broadly diffuse but we face the challenge of climate change.

I argue in my book that free market capitalism will greatly help all of us to adapt to many of the challenges of climate change.  During this time when we focus on income inequality, some of us have forgotten the benefits of free markets.  Capitalism is an amazingly adaptable system for organizing activity.  Price signals (whether it is scarce water, or the desire for renewable power) will direct human ingenuity to get to work on the  hard problems that climate change will cause. From a law of large numbers, we will find many solutions.  Ideas are public goods .  Once we have Facebook, we can all benefit from it.   We only needed one guy to produce it.  Our future entrepreneurs will focus on climate change challenges.

I am well aware that some geographical areas (especially in poor nations) will be hammered by climate change.  Migration will be required and land owners and those who can’t move will suffer.  For more on LDC migration and climate change read this.    The imperative to support economic growth and poverty reduction in LDCs is enhanced by the climate change challenge.

Obama laid the responsibility for the rejection of the pipeline on political gamesmanship by Republicans.

“As the State Department made clear last month, the rushed and arbitrary deadline insisted on by Congressional Republicans prevented a full assessment of the pipeline’s impact, especially the health and safety of the American people, as well as our environment.” Obama said. “As a result, the Secretary of State has recommended that the application be denied.  And after reviewing the State Department’s report, I agree.” 

TransCanada Corp. shares slid more than 3 percent after reports early Wednesday that rejection was imminent.

Rejection of the pipeline had been expected in Washington after Obama tried to delay the decision until 2013 but Congress forced his hand as part of a popular tax cut measure.

“This announcement is not a judgment on the merits of the pipeline, but the arbitrary nature of a deadline that prevented the State Department from gathering the information necessary to approve the project and protect the American people, Obama said. ”I’m disappointed that Republicans in Congress forced this decision, but it does not change my Administration’s commitment to American-made energy that creates jobs and reduces our dependence on oil.”

The GOP will try to tie an extension of the payroll tax-cut to an approval of Keystone XL.  Given that the payroll tax cut actually does create jobs while Keystone XL is marginal, that makes little sense as public policy, but it’s probably smart politics for Republicans.  If Obama rejects the deal and the payroll tax goes up, then it help deflate the economy, which helps Republicans, and if Obama accepts, it will demoralize the Democratic base.  Since Pravda Fox News is still pushing discredited jobs numbers for the pipeline, the GOP might just get away with it.