A Free-Market Energy Blog

Climate/Energy Statism: An Inside Conversation (Part II)

By Robert Bradley Jr. -- July 3, 2018

“A carbon tax is not simple either, especially when you start talking about how the revenue will be distributed. … Yes, there would be a food fight over the revenue….”

Antonia Herzog, Natural Resources Defense Council

“I wish I could tell you that Republican offices have approached us and said, ‘Thank you for doing this, we are ready to talk about it’…. [F]rankly Senators Schatz and Whitehouse are two of the more liberal members of the Senate.”

There is also concern from the left that those conversations [with Republicans] could lead to eradication of EPA authority or at least a moratorium on EPA authority, which leaves some folks nervous….”

– Michael Obetter, Office of Sen. Brian Schatz

“I find these meetings extremely productive and helpful. They have influenced my thinking in how best to go about what I want to accomplish in the House and Senate with the GOP. I think we are approaching a time where it might be right to bring in some of these Republican actors who can be moved into a better place….”

Jerry Taylor, Niskanen Center

Part I yesterday examined the meeting notes from this pre-Trump meeting of the minds of those who want to price carbon dioxide in the name of climate alarmism and forced energy transformation. This rare look concludes with Part II today.

Energy Future Coalition Steering Committee Meeting Notes
February 23, 2016

Steering Committee
Richard Cizik, New Evangelical Partnership for the Common Good
Greg Dotson, Center for American Progress
Mike Finley, Turner Foundation
Maggie Fox (via phone)
Boyden Gray, Boyden Gray & Associates
Adele Morris, Brookings Institution (via phone)
Mark Safty, UC Denver (via phone)
Steve Symms, Parry, Romani, DeConcini & Symms
Jerry Taylor, Niskanen Center
Tim Wirth, United Nations Foundation

Jon Barton, Service Employees International Union (via phone)
Roger Dower, Johnson Foundation
Shelley Fidler, Van Ness Feldman
Antonia Herzog, Natural Resources Defense Council
Michael Obeiter, Office of Sen. Brian Schatz
Chad Stone, Center on Budget and Policy Priorities
Eric Toder, Urban-Brookings Tax Policy Center
Tom Stokes, Pricing Carbon Initiative (via phone)

Carbon Pricing: Progressive Views – A Congressional Perspective

TIM WIRTH (United Nations Foundation)
Michael, you have to speak to all of this. For those of us with the Energy Future Coalition, one of the tasks we have to begin to sketch out for this coming year is, what is the most productive role for this particular coalition of different people to play? And how much can we help to have these discussions? And how much can we help to bring people together? I think this is enormously promising.

My own view is that this is moving much faster than anyone would have thought a year or two ago. I also worry that as it moves quickly, you may get an intensity of a kind of veto power in some big constituency somewhere that says no, and you can almost get blocked by that. I think we want to figure out how we can best position ourselves to be someplace where we can be in the way of that veto power and help sort that out, help people talk about it, help people meet each other, and so on. That is my particular interest in having this discussion and listening to what you and the Senator think about this.

MICHAEL OBEITER (Office of Sen. Brian Schatz)
Thanks very much for inviting me and giving me the opportunity to speak with you. Personally, I do think Sen. Schatz has it right – that is one of the reasons why I really wanted to work for him – but I also think there is not one right answer. Much of what I am going to talk about has been covered already in various forms by the participants before me. So I will go quickly through the presentation so we can get to the discussion about it.

Sen. Schatz cares passionately about the issue of climate change, and he is interested in finding solutions. I like to use the analogy that he is throwing a lot at the wall and seeing what sticks. He is interested in finding various different solutions – a carbon tax is obviously one of them, but he is also interested in how innovation can reduce greenhouse gas emission and potentially reduce compliance costs of a carbon tax, leveling the playing field for different sources of energy – reducing fossil fuel subsidies in the same way that clean energy tax credits are being phased down – and defending the Clean Power Plan.

Clearly a lot of different irons in the fire. As a co-sponsor of the American Opportunity Carbon Fee Act, or the Whitehouse-Schatz bill, he believes – most strongly – in the prospects of a carbon tax to get us where we need to go.

I want to talk about what the bill does, and then we can talk about some other considerations. The bill imposes a price on all greenhouse gas emissions of $45/ton, rising at 2% annually. The $45/ton figure was chosen because it was the central estimate in the Administration’s social cost of carbon, and it is pegged to rise at roughly the same rate as the Administration projected.

The fee would be assessed as far upstream as possible to try and minimize the number of affected entities: where coal is mined, where oil is extracted or imported, where natural gas is processed, as well as on large emitters of industrial gases and non-fossil-fuel-based greenhouse gases There is a border tax adjustment to protect vulnerable industries – those that are energy-intensive and trade-exposed. The revenues are used to address a lot of what we have already spoken to today.

In this iteration of the bill, roughly half of the revenues go toward reducing the corporate income tax. The top line rate goes from 35% to 29%, roughly another half goes to a lump sum dividend – about $500 per individual – and some also goes to transition assistance grants for states. Those grants can be used for assisting low-income households in addressing increased energy costs, assisting rural households in addressing higher energy costs, and also providing job training for displaced workers – especially in fossil-fuel-related industries.

As I said, that is the current iteration of the bill. The first iteration, which was introduced last Congress, left the revenue question wide open. This is why I am really curious, Jerry, to see what your group comes up with. Last Congress, the Whitehouse-Schatz bill said, “Here is a price on carbon, and here are 17 different options for revenue.”

I cannot think of anything that has ever been proposed that was not covered in this bill – everything from tax cuts, corporate tax cuts, payroll tax cuts, Medicare tax cuts, lump sum dividends, R&D, and transition assistance. Anything you can think of was in this bill.

The bill was designed to start a conversation, which did not materialize in the way the Senator wanted it to; therefore, the latest iteration of the bill tries to meet Republicans halfway. Most conservative arguments we have heard say one of the best uses would be reducing the corporate income tax rate to make the United States more competitive globally.

It is the most economically efficient argument, we have heard, and therefore the best use for it – which is why this version of the bill uses about half of the revenue for corporate income tax cuts. The other half is lump sum dividends, which as we have heard, really help offset the regressivity of a carbon tax. This is extremely important to my boss, as it is extremely important to progressives, generally.

We have also heard today, that you do not need half the revenue to offset the regressivity of a carbon tax. That would get us, as Chad mentioned, higher up the income distribution. It would certainly cover the bottom 20% of the income distribution, probably the second quintile, all the way through the middle class. But if you are concerned just with making the bottom quintile whole, then that leaves you with a lot of extra revenue – even if you are devoting half of it to corporate income tax reduction.

One of the reasons the carbon tax appeals to Senator Schatz is because it gives the government a pot of revenue, which it can then use to address other policy priorities. Given his druthers, I know the Senator would certainly devote a lot of that to innovation – probably more than tripling R&D, although I cannot say for certain. Going from $6 billion to $18 billion is great, but I am sure there is even more that we can do.

These investments will help drive down compliance costs, and in the future reduce the economic burden of a carbon tax. There is job training, and there is LIHEAP; progressives would like to see the revenue used to make sure that beyond the lump sum dividend, the poorest folks are made whole and are not bearing any burden from increased energy costs.

There are more considerations than just what to do with the revenue. Principal among them, I think for many folks at this table, would be driving down greenhouse gas emissions. Boyden, to your point, I think we would agree that a carbon tax is more efficient than patchwork regulations covering sector by sector.

Modeling by RFF on this bill shows that the carbon tax proposed by Whitehouse and Schatz would drive down economy-wide greenhouse gas emissions 39% below 2005 levels by 2025, putting us well beyond our commitments made in Paris and what is achieved by the Clean Power Plan. You would certainly be getting deeper reductions than you would in sectors not yet covered by EPA authority.

On the policy interaction piece, my boss is dedicated to defending the Clean Power Plan because right now it is the only tool and the biggest tool we have for ratcheting down greenhouse gas emissions in the near-term future. I think we also believe that a carbon tax and EPA authority can go hand in hand. You may think the Clean Power Plan and the carbon tax are redundant, and I think there is a good case to be made for that.

I also think you could argue that a carbon tax would make meeting the Clean Power Plan easier and potentially cheaper. What we would argue is, you cannot simply repeal EPA authority; pausing it might make sense, but you do need some sort of backstop to ensure environmental goals are met.

As I mentioned, the Clean Power Plan may be made redundant, but CAFE standards, for example, are probably not. There is good evidence to show the transportation sector is not as price-sensitive as the electricity sector. The substitutes for driving down emissions, such as electric vehicles, are not cost-competitive right now and may be a decade out. I think it is important that at least some EPA authority is preserved, even if we do go the route of a carbon tax.

REID DETCHON (United Nations)
We have such a good group on the phone, I want to get a couple of comments from those participants if we could. Jon Barton, given that you got up at such an early hour to listen in on this conversation, from SEIU’s perspective, or a labor perspective, is there any reaction you want to share with the group on the conversation so far?

JON BARTON (Service Employees International Union)

Thanks – this has been really interesting for me. We have had some conversations at SEIU on carbon taxes. I know that a concern we would have, and a focus we would like to see in any ongoing conversation, would be how to address the needs of low-income people, issues around equity, and just transition for workers in impacted communities. We have thought about it less from a corporate tax reduction standpoint and more from a perspective of how we address issues of equity for low- and middle-income people.

ADELE MORRIS (Brookings Institution)

I would like to jump in on that point. We were talking about taxes versus cap-and-trade, and it really struck me that in the waning days of the deliberations on Waxman-Markey, the Republicans successfully dubbed the policy a job-killing energy tax. Our modeling suggests that if you do some kind of program with pro-growth tax swaps, where you use the revenues to reduce capital income taxes, you get the boost to GDP that offsets the carbon tax burdens. Actually, under certain scenarios in our model, we actually get an increase in employment, GDP, and economic growth.

It is really important to think through what Republicans will be able to say they won through agreeing to this deal. You have to find the formulation of having low-income households and coal-reliant communities and workers protected, but also having pro-growth fiscal reform as part of it, then maybe some suspension of the Clean Power Plan and other 111d rules. To me, that seems to have the potential to be a very powerful story.

I just wanted to make one other point about environmental certainty. One big difference between greenhouse gases and other pollutants is that it is a stock pollutant. Therefore, the damages are determined by many years of emissions from all over the world. It is a mistake to get too wrapped around the environmental certainty of one year’s emissions from one country.

If there is an advantage in climate policy over other kinds of policy, it is that if we are 5 to 10% off in any one year’s emissions, it is not that big a deal in the realm of the huge stock pollutant that we are dealing with. I would encourage people when they think about backstop policies, to really look at the numbers, data, and empirical significance of being off. Remember with a tax you can overachieve your targets, just as you could underachieve them; getting worked up over a downside risk of a minor amount in the context of this problem is a mistake.

Thanks, Adele. Antonia, we have touched on environmental certainty – is the environmental community as interested in this conversation as we are? What is your reflection on this?

ANTONIA HERZOG (Natural Resources Defense Council)

I hate to speak for the environmental community as a whole. Certainly, we strongly believe we have to reach all sectors, and the only tool we currently have is 111(d) under the Clean Air Act and the Clean Power Plan. Of course, in the old days, we wanted to go the legislative route, and this was the backstop – and now we are here. For the longer term, we probably do need to go back to comprehensive legislation that reaches all sectors.

We have always fully supported the cap-and-trade approach, which is ultimately about carbon pricing. A carbon tax is not simple either, especially when you start talking about how the revenue will be distributed. You can craft a carbon tax, which was done, where you tie it to emissions levels so you can ramp it up and down depending on where you are at.

In fact, I think the Center for Clean Air Policy (CCAP) put some ideas together around that several years ago. It is the political dimension, and if we can break that barrier, I think many people would be more than happy to come to the table. Yes, there would be a food fight over the revenue, but as Greg suggested, that could be figured out.

Michael, you made a reference to an earlier bill and said it did not go as well as you hoped. I am curious, both on the Democratic and Republican side, what are the kinds of things you hear from their offices? Are they ready to talk about this? Are they more skittish now?

MICHAEL OBEITER (Office of Sen. Brian Schatz)

I wish I could tell you that Republican offices have approached us and said, “Thank you for doing this, we are ready to talk about it,” but they have not. I am not suggesting they are not willing to talk about this, but frankly, Senators Schatz and Whitehouse are two of the more liberal members of the Senate.

As I said, we were trying to start a conversation. I know both Senators Schatz and Whitehouse would be extremely happy to sit down with any interested party and start negotiating around price, around what to do with the revenue, and around EPA preemption. This is meant to be a starting point, not an ending point.

There is also concern from the left that those conversations could lead to eradication of EPA authority or at least a moratorium on EPA authority, which leaves some folks nervous, and we certainly understand that. We are not getting attacked by either side.

Unfortunately, we just have not reached the point where Congress is ready to have this conversation out in the open, or even a big conversation behind closed doors. I think a large part of that is the uncertainty around the Clean Power Plan. As Jerry mentioned, a lot of folks are still expecting the Supreme Court to overturn it; they think it is on shaky legal ground. I think it might take until the Supreme Court weighs in on that before a lot of people are willing to come to the table and say, “This is real, this is actually happening. What are our alternatives?

JERRY TAYLOR (Niskanen Center)
I appreciate the interest in starting a conversation with the Republicans in the Senate, but I have to tell you that conversation is not going to begin until the Clean Power Plan is on the table for suspension in the course of a carbon tax. It is just not the case that Republicans are interested in a carbon tax primarily as a means of offsetting tax cuts elsewhere. There are some, but they are few and far between.

It is really about the big, bad Clean Power Plan. Which, as everyone at this table knows, is the big, bad Clean Power Plan that is going to give us $6 permit prices, perhaps – according to the modeling that we have seen come out of Bradley, RFF, and other parties. So it is not exactly the life raft for the environmental community to address greenhouse gas emissions, but that is what needs to happen if you want to have a conversation. The reason you have not is because that was not put on the table in the bill, for better or for worse.

That is totally fair, and I completely agree with you that it has to be on the table for Republicans to be willing to negotiate. I can only speak for my boss, but the reason it is not in this bill is because Democrats do not want to negotiate with ourselves right now. So if and when Republicans come to the table, that will certainly be part of the negotiations.

I understand that the most likely route, and maybe the only route to getting a carbon tax, is at least a temporary suspension of the Clean Power Plan – I know my boss is willing to have that conversation, and so is Senator Whitehouse, but they do not want to be the only ones having that conversation.

MIKE FINLEY (Turner Foundation)

Eric, I want to set up a question. You mentioned macroeconomic models and environmental benefits and impacts. The Energy Future Coalition has had two presentations on ocean acidification. The last one was from the head of the division for ocean acidification at National Oceanic and Atmospheric Administration (NOAA). What we find is that ocean acidification is not in the lexicon – climate change is, but ocean acidification is not. They have the same father – it is carbon pollution and greenhouse gases, but they are two separate processes.

I am bicoastal – I am the Chair of the Oregon Fish & Wildlife Commission, and the entire West Coast, including the Alaskan panhandle, is being hit by acid water. It is coming across the Pacific; it has been documented by NOAA. It is affecting the seafood industry. It is not a hockey stick model. The question is: Is ocean acidification getting its true analysis as a cost to the environment in terms of greenhouse gases? Or is it just a stepsister?

ERIC TODER (Urban-Brookings Tax Policy Center)
I have not heard of it, but I am not the barometer for this – perhaps Adele has heard of it. I think it is the people who do the climate modeling who would deal with this, and I am not sure how much they are taking it into account.

That is why I brought it up, because I did not hear it. I do not know how you can do a comprehensive environmental analysis on environmental impacts of greenhouse gases if you have not taken it into account. If you look back in our fossil record, one of the biggest extinction events in the history of the Earth was acidified ocean. It was not caused by humans, it was caused by nature, volcanoes, and so forth – but it was massive. And on a linear trend, we are headed that way right now – slowly, but surely – 20% of all greenhouse gases enter the ocean and form carbonic acid. Without us actually considering this as a society, we are leaving a wonderful intellectual tool in the box, and it is not even sharpened, which is why I brought it up.
I might be able to say something about that. The technical document the White House prepared that estimates the social cost of carbon provides the dollar value for computing the benefits of rules that reduce emissions, and the latest document does not even mention ocean acidification. The words do not even appear in the document. It is clear to me that our current estimates of the social cost of carbon potentially greatly underestimate the cost because they are leaving out entire categories of impacts. I have had this conversation with Libby Jewett at NOAA. I know there are efforts by economists to try and put a dollar value on that, because that is really where it needs to be. We are not going to be setting goals efficiently if we are not properly estimating damages.

There are wildly different estimates of the social cost of carbon. Obviously this is one factor that probably should be added in and is not. Even at the moderate estimates that are driving these carbon tax proposals, we are so far away from even being able to get that through. It can add to the argument, but it does not.
I only bring it up, because among climate deniers that I deal with and talk to, they will cling to anti-hockey stick climate change. When you introduce ocean acidification, it will cause a pause in their thinking; in other words, the mind has not snapped shut because you mentioned climate change. I found it a powerful way to discuss it. Tim and I laugh because we call it the evil twin; climate change is on this side of the coin, and ocean acidification is on the other. They have the same father or mother, but different impacts entirely.
I would like to say something to that point. NRDC does work on ocean acidification. We have ocean scientists who are very concerned, and they have been working with some folks in Congress, and Republicans, on this issue because the fisheries community is very concerned. But they are working on it outside of the context of climate change, and that is how they have been making headway. I keep pushing them to try and change that because I think we need to. I think the point about the social cost of carbon is an interesting one; it is complicated to calculate, and they have done the best they can, but there are many gaps, and it is wildly underestimated.
Let me just put something in your mind in response to that. We in this room, and the United Nations in particular, know that we have crossed 7 billion as the global population, and we are headed on an arc that at 2050 will either be 9 billion or 11 billion people. There is already a huge protein deficit worldwide. You cannot turn to pork and livestock to fill that because of the greenhouse gases, but you can turn to fisheries and aquaculture as a way to fill a protein gap that is approaching. This thing is worthy of deep analysis and requires a lot of work to stop this train.
I totally agree. Our effort has simply been to get more dollars so that we can do more research because the data is lacking at this point.
We had a discussion about this several meetings ago, and the fisheries people came in and were diplomatic about it, but it was still clear that they do not want to be associated with climate change because the science on climate change is so muddled, political, and politicized. Whereas the science on their side is very clean and solid. I thought that was an interesting commentary on life in general, but that is part of the problem, they do not want their clean science muddled by the politics of climate change.
Boyden – that is the reason why we should separate them as they are, two independent processes. You can talk to a denier and say, “It really does not matter whether you believe in climate change or not, ocean acidification is happening today.” You know, Oregon oyster farms used to just pump sea water into their tanks to raise oysters. They now have to buffer that water in their tanks, or the oyster spats die – they have to develop their shell in 24 hours. That is real, and it is happening from Alaska to California.
But if you keep ocean acidification separate from the climate change conversation, how do you develop solutions?
The real issue is carbon pollution. It has provided two impacts; one is something some people do not believe in, and the other has clean science. I have found that at least you can talk to some people who do not believe in climate change. In fact, one of the people in the film we just produced at Oregon State University is a climate denier, but is engaged in ocean acidification.
But does he support or would he support policies that reduce carbon pollution?
We are getting there very quickly.
Michael, what kind of responses are you getting?
Being an island state, ocean acidification is a huge issue – as is sea level rise. We pitched our bill as a climate bill. Yes, the science is highly politicized, but climate change is more prevalent in people’s minds. If we pitched this as an ocean acidification bill, would we have a different reaction? I do not know, but the nice thing about a price on carbon is that it is both.
I agree, and you have two ways to reach a constituency, to put them together and say we both matter.

GREG DOTSON (Center for American Progress)
This is a smaller point but related to this conversation and relevant to the conversation on a carbon tax. Economic modeling essentially puts all these issues into a spotlight that complicates debate about the establishment of a carbon tax. The reason I say that is, economic models are very good at taking proposed tax policies and telling us what the effects are distributionally, what the effects are as far as increased consumption costs, and what the effects are as far as reductions in real wages. That generates targets that people will use to prevent a carbon tax from being established. Those same models are terrible at doing things like including ocean acidification and the social cost of carbon.

Even if we were all to agree that the social cost of carbon has already been factored in, how do you relate that to specific, individual households? It is essentially impossible, I think, because you are talking about a global effect of carbon.

What does flooding in Bangladesh have to do with a house in Peoria? Even just focusing on the domestic cost of carbon, you are looking at hurricanes along the Gulf Coast and relating that to individuals. My point is simply that there is a unique modeling challenge presented by this. We need to talk about it in a way that gives everyone comfort that the ultimate deal is going to be something worthwhile for all Americans to participate in.

CHAD STONE (Center on Budget and Policy Priorities)
That was the last 30 seconds of Eric’s talk, where he said, “I do not have anything to say.” That is the most interesting unexaminable distributional impact across households – we do not have data for that among the environmental effects. The fact that you have an argument that appeals to one constituency and a different argument that appeals to a different constituency on behalf of the same policy, maybe allows broadening the constituency without getting them to agree.

To Greg’s point, in talking about the economic impacts and costs, always remember that analysis does not have anything to do with why we are doing it in the first place, which are the gains and benefits. This is the cost side analysis of achieving the benefits and it is always important to keep benefits.

ERIC TODER (Center on Budget and Policy Priorities)

I think the modeling is always a bit like the drunk who was looking for his keys under the lamp post. We are missing the really big thing, which is much harder to measure – the environmental impacts.

What is the process of the carbon becoming acid in the water? Does it come from the atmosphere?
It leaves the atmosphere and is absorbed into the water where it forms carbonic acid. The ocean is basic; the ocean is like 8.2 pH, and it does not take much.
So if it rains, it washes it into the water?
It is basically just absorbed right into the sea. NOAA has measured at 150 meters, across the Pacific, a current that is actually carrying this acidic water. It bifurcates, and one hits the coast of South America near the upwelling. The other one goes up north, hits around California and then follows Oregon, Washington, and into the Alaskan panhandle. That is the map of just this one current. How many others are there that we do not know about yet that are also contributing? It is real, and NOAA has known about it for years. This current originates up north in a caustic sea, northeast of Japan. Then it mixes at the Pacific with atmospheric carbon dioxide that just happens to be in the atmosphere.
Mike, is this something the PEW Charitable Trust is working on? They have spent a lot of money on ocean issues.
That is the problem. If you sense frustration in my voice, it is because we have not gotten this out into the thinking of the public. You hear Libby in this room do a marvelous presentation, Boyden remembered it, but that seems to be where it dies. That is one of the things we are looking at in the Turner Foundation. Who do we partner with to get this out, so that the Republican base that is not responding to the hockey stick model might stop to think about this as a pressing issue globally.
Before we close, I want to give the folks on the phone, if anyone’s been dying to intervene, an opportunity to weigh in.

Reid, I do not have anything to add except great session. Congratulations for putting this together. I appreciate the presenters’ remarks today. On a point of personal privilege for my friend Adele, my classmate on the Steering Committee, great job yesterday on the Brookings Institute event about the Clean Power Plan. A very nice panel, with a stirring presentation by Bill Ritter. I highly recommend it to any of you that did not catch it.

Thanks, Mark. Thanks very much for the plug of the event – it is on our website. I just want to congratulate you, Reid, and Senator Wirth, and those of you who organized this session. I think the potential for pricing carbon in the U.S. is so important. One last thought I want to leave you with is that we have not talked about diplomatic implications. I think that we should not underestimate the power of clear and predictable pricing in the U.S. for leveraging that internationally in the diplomatic process. Do not just think that we are looking at emissions domestically; I think it will have additional effects abroad. Maybe at some point we can talk a little bit more about that.
Boyden, one thing we hear around the table is frustration about getting conversations started more on the Republican side. Does that have to wait for the elections? Are there things we can do in this room as the Energy Future Coalition to encourage those conversations?
It is two things: the uncertainty about how who wins the elections and the fifth seat on the Supreme Court. Why does the fifth seat matter? As you all know, it is unprecedented – the courts have never issued a stay before the case has even gotten there. There is just a huge amount of uncertainty. I do not know how much you will get during this electoral period, until there is some more clarity on what is happening. I just do not think you are going to get people to commit. I think it has not yet sunk in, on some of the coal advocates, the risk they run with Scalia gone. People are still trying to figure it out. In the legal world I inhabit, there has been no earthquake like this. You cannot blame people for not quite knowing how to react.

Even given that, and those uncertainties, and given they are greater now than they were three weeks ago – in thinking about the Energy Future Coalition – doesn’t that argue that we should continue having diverse conversations and groups of people here? Where we are setting the table and listening to what people have to say about what they are doing? That is our primary role. There are a number of people who ought to be here.

Those of you who were not here, we had an end-of-the-year session for the Energy Future Coalition in December. I went around the room and asked if this is something we ought to be continuing to do, and it was a resounding yes. This is an extremely important venue for people to be able to come and listen to other people, and talk to them in an unthreatened, uncommitted way.
This is a safe harbor in a way. Until the election, it is all going to be setting the table for the next year. If you look at it from that point of view, there are many opportunities in great part because there will be no legislation, and it is a safe harbor.

For those who live in this community day in and out, are we repeating activity that is going on? Are we reinventing the wheel? Any reactions to this? Give me some window into what you see on this, Jerry?

For my part, I find these meetings extremely productive and helpful. They have influenced my thinking in how best to go about what I want to accomplish in the House and Senate with the GOP. I think we are approaching a time where it might be right to bring in some of these Republican actors who can be moved into a better place by learning first-hand that it is a policy conversation that has real possibilities, that is politically viable, and that it is not a pointless conversation because parties on both sides of the aisle have incentives and interests. This group could be helpful in that.

There are a few other forums where this conversation occurs, but what is different at the Energy Future Coalition is that this is less a session in engaged economic wonkery, than it is a broader conversation about how it fits politically. That ultimately is the real challenge we face. So no, I do not see other competing forums for this conversation.

TOM STOKES (Tom Stokes, Pricing Carbon Initiative)
I have listened very attentively to this discussion. Arguably, we are one of those other forums that Jerry was referring to, but I think that this forum is a terrific complement to what we and others are doing. I just want to thank you for letting me participate.

One thing that has come up repeatedly today is the impact on coal. I think another thing we have not addressed in terms of bombshells, is the extension of the production tax credits (PTCs). The combination of low gas prices and the production tax credits means that, without regard to the Clean Power Plan, coal is going away – period. If they think fighting the Clean Power Plan is going to do a whit of good to them, they are crazy. We can have that conversation here.

We usually have the AFL-CIO as part of our group; Tim mentioned they are on the West Coast today. They obviously have the mine workers among their organization. I suggest that maybe down the road we bring Rich Trumka and the mine workers in and have a serious conversation about the choices they face. The landscape seriously changed at the end of the year, with the five-year extension of the production tax credits; and we have never had that kind of certainty about renewable energy in this country.
Rick Trumka spoke two years ago at our big UN conference, and it was incredibly moving. He is someone that came out of coal country, grew up in coal country, was head of the mine workers, was head of AFL-CIO, and then understood that we have a very serious social gap in our society and we have to deal with it. I think he said 11 states are deeply affected by this, and at last count that is 22 members of the United States Senate. That is a very moving reality from his perspective, but also a political reality. What is the opportunity that gives you? That is something we could productively look at – I would like to have us try and do that.

Thank you to all of you for coming. It is a continuing and fascinating discussion. The next meeting will focus on something we have been looking at for a long time, which is solutions from the land. How do we think about the land and climate change together?

We will have some very encouraging news out of the agriculture community about the progress that is being made in capturing carbon in soil through improved agriculture practices, which suggests an opportunity more broadly for climate change. One figure I have seen that I cannot vouch for is that we could offset about 20 to 30% of global emissions through improved global practices on land use and forestry. This is not 100%, it is not the answer or alternative, but it could buy us time as we wait for the solutions to come along.
Our Steering Committee member, Tom Lovejoy, had a very nice piece last Sunday in the New York Times or the Post on the work going on in the Amazon. We ought to send that out to everyone in preparation for this meeting. If you look at the fact that we cannot put anything more in the atmosphere, and we know what is going on in the oceans, then we have think much more creatively about using the land. Talk about a big policy move, but we have been working on that for a long time.
Special thanks to Greg and Adele for putting this together

One Comment for “Climate/Energy Statism: An Inside Conversation (Part II)”

  1. Ronald Walter  

    The combination of low gas prices and the production tax credits means that, without regard to the Clean Power Plan, coal is going away – period.

    Have you ever read anything so stupid?

    Chortle, non-stop laughter, derisive, even.

    Coal is mined and burned at a rate of 7.5 billion tons each year. If coal goes away, so does a lot of energy in the form of electricity produced from coal. The estimate for the future is nine billion.
    Hardly going to go away.

    What should go away is all of the bunkum and bosh involved with the climate change and the complete nonsense of a carbon tax.

    Coal going away is pie-in-the-sky nonsense from the ivory tower idiots.

    Yeah, that’s right, they’re just plain idiotic. The world needs to rid of them and good riddance.

    Climate Change Alarmists won’t admit they are wrong


Leave a Reply