Why the U.S.-China Climate Deal May Be a Tipping Point

The Obama administration announced a climate agreement with China last week, which was immediately criticized by congressional Republicans. Putting aside partisan churlishness however, this climate agreement may be a turning point.

As I wrote three years ago, and international climate negotiations are, above all, a game-theoretic process. For an international climate agreement to be durable, there must be sufficient confidence on the part of all parties that all of the other parties are committed to mitigation of greenhouse gas emissions. For any individual country, it is likely that the benefits of mitigating greenhouse gas emissions are much greater than the costs. However, this is predicated on other countries also performing their own self-interested cost-benefit analysis and arriving at the same conclusion. It is a fragile agreement indeed, when there are numerous parties, all of which must trust that all of the other parties will reach the same conclusion and will refrain from free-riding. Ironically, a country that makes great strides in mitigation or geo-engineering may actually undermine cooperation, as this would sow doubt among potential partners that such a country may not reach the conclusion that the benefits of reducing greenhouse gases exceed the costs. In an environment of such fragile cooperation, signaling is extremely important. This US – China deal may just be the strongest signal yet that the two largest emitters in the world recognize that the benefits of climate policy exceed the costs.

Virginia Possibly Pushing For a State Carbon Tax Under Clean Power Plan

Adele Morris of the Brookings Institution reports that state of Virginia has submitted comments on the EPA's Clean Power Plan that call for additional flexibility in compliance options. Significantly, the Virginia comments were very similar to those that Morris has been advocating, in her push to get states to consider a state carbon tax, and to have a state carbon tax be an option for complying with section 111(d). Morris and others met with Virginia state officials three months ago to discuss a state carbon tax and suggested comments, so apparently that meeting went pretty well.

This is a potentially huge development, because Virginia is a very carbon-intensive state. Under the EPA proposed rule, Virginia is expected to reduce its emissions from a rate of 1438 lbs. of CO2/net MWhr to 884 by 2020, and to 810 by 2030. That a state that is politically purple and with a very important coal industry is considering a state carbon tax is much more significant then if this was under consideration in a state like Massachusetts or Washington.

Land Use Law and Disability

Robin Paul Malloy's Land Use Law and Disability: Planning and Zoning for Accessible Communities has just been published by Cambridge University Press. Malloy argues that Land Use Planning should take greater account of people with mobility impairments and other disabilities that interfere with access. Planning with universal access design guidelines is superior to the de facto litigation-driven process of land use planning for accommodating persons with disabilities.

The U.S.-China Climate Deal

Everybody, even people disinterested in the environment, has heard by now: President Obama announced a bilateral agreement between the United States and China for the United States to reduce emission 26 to 28 percent below 2005 levels by 2025, and China will peak its emissions by 2030. Those are the central pieces of the deal. There is also agreement to jointly pursue carbon capture and sequestration, funding for a new US-China energy research center, and other feel-goodies, but clearly something that speaks directly to emissions is the big deal.

Mitch McConnell and fellow Kentuckian Ed Whitfield proved again why the Republican Party deserves our scorn, by simply dismissing the deal because it was struck by Obama. If Obama's for it, then Republicans are agin' it. McConnell said that the deal "requires China to do nothing for 16 years." That is true. Of course, the alternative is no deal at all, as if McConnell expects China to cap emissions tomorrow. Rep. Ed Whitfield from Kentucky snarked, "Everyone who's ever dealt with China knows that they've made all kinds of commitments." That's Ed Whitfield, the noted Sinophile. As a more thoughtful commentator pointed out, what matters more is the level at which China peaks than when it peaks. Importantly, though, a 2030 peak will likely keep China below a BAU baseline. It also represents a step in that China is moving away from an intensity target -- which is no cap at all -- to a mass-based cap.

Everyone who reads the newspaper understands the inherent caution and conservatism of Chinese foreign policy, which is driven by the Chinese Communist Party's Politburo Standing Committee, the real decisionmaker, and which makes decision by consensus and under strict Chatham House rules. Policy changes slowly in China. There will be next step, and it will be the specification of an absolute cap, a "how much" and not just a "when."

Direct Air Capture Technology About to Come Online

"Direct Air Capture" (DAC) is a term that has been used to describe a technology that seeks to suck carbon dioxide out of the ambient air. That contrasts with "carbon capture and storage," (CCS) which seeks to either suck carbon dioxide out of the flue stream of a fossil fuel combustion process, or to de-carbonize coal before combustion.

DAC has never been a mainstream technology, in large part because so much has been invested politically and economically in CCS technology. Senator Lamar Alexander once said "w[e] should launch another mini-Manhattan Project and reserve a Nobel Prize for the scientist who can get rid of the carbon from existing coal plants, because coal provides half our energy." But it would appear to deserve some attention, as an effective post-combustion technology could buy some time. David Keith, who moved from the University of Calgary to Harvard a few years ago, has been the primary agitator for this technology, and even founded his own startup company, Carbon Engineering, which counts Bill Gates as one of its investors. It is a Carbon Engineering pilot project that will begin operations in Squamish, British Columbia, next year. Keith claimed in 2009 that carbon dioxide could be captured at a cost of "closer to $100 per ton than $500 per ton." The American Physical Society came out with a withering criticism, offering its own less sanguine estimate of $600 per ton, at the very least. The physical problem with direct air capture is that carbon dioxide comprises such a small fraction of our ambient air -- 0.04% -- so that capture from ambient air is inherently less efficient than, say, capture near the source (a coal-fired power plant). Nevertheless, I'm going to borrow my Governor's go-to line when faced with uncomfortable scientific facts: "I'm not a scientist." Let's see how this pilot plant in British Columbia does.

The politics of direct air capture are simply that no politician has heard of it, and that David Keith or Carbon Engineering is not yet a major political or campaign contributing source. It has to get picked up by an AEP or a Duke. But given the century-long atmospheric life of carbon dioxide, this technology has to be seriously considered.

The one downside of this technology is highlighted in an article I wrote in 2011: that success would ultimately decrease the pressure to reach an international agreement to reduce emissions. Research on direct air capture could allow say, China and India, to simply free-ride off of the research efforts of Canada and the United States. We could build the massive carbon dioxide collector arrays, and China and India would then go on building coal-fired power plants and emitting. That might be politically unappealing.

Chile Enacts a Carbon Tax

On September 26, Chile became the first country in South America to enact a carbon tax. This story was picked up the following day by Reuters, and was not picked up by the New York Times until October 29. The New York Times is taking its divestment from climate change coverage seriously, it appears. It appears to be too busy trying its best to save the Senate from Republican control.

The tax will be $5 per ton of carbon dioxide, and is limited to the electricity generation sector, and will cover 55% of country-wide emissions.There is some natural political economy to the measure, as 80% of Chile's energy emissions are from fossil fuels, and most of it is imported oil and coal, so it is not as if domestic production of fossil fuels will be curtailed so much, as it would in the United States. But of course, the electricity generators (there are four big ones) will raise the price of electricity, and the energy-intensive mining industry, an important one for Chile economically, will feel some pain. Chile reports that it expects to collect $160 million per year in carbon tax revenues, which I can't quite back out. In 2013, Chile's emitted of 24 Mt of carbon, or (taking into account the weight of carbon dioxide as opposed to carbon) 88 tons of carbon dioxide. If, as economist Juan-Pablo Montero reports, the tax will cover 55% of Chile's emissions, it would seem to me that the covered emissions would be 48.4 Mt of CO2, and therefore revenues should be around $242 million, not accounting for the demand response to the carbon tax. Maybe the Chilean officials and Dr. Montero have different estimates of what emissions will be covered.

At any rate, Chilean officials and Dr. Montero state the obvious, which nevertheless eludes some in the United States: that of course, Chile will have to go beyond $5 per ton, but that the institutions can now be put into place to pave the way for increases in the carbon tax in the future.