Environmental Economics

Costs of beach nourishment

Some simple economics, courtesy of the Wilmington Star-News (Cost might force delay of beach nourishment).

The SE NC coast got hammered by the active hurricane season and and the towns are in need of sand to protect the beach houses located a few feet from high tide. The US Army Corps of Engineers has been soliciting bids but they can't contract with dredging companies if the bid comes in over 25% of their own cost estimate.

Last year, the cost estimates came in under the USACE's estimate. This year they are coming in over the 25% cutoff with the blame focused on the increased dredging activity in the Gulf of Mexico.

The marginal cost of beach nourishment is upward sloping and the increased demand for nourishment in 2005 has led to increased prices.

Supply and demand, supply and demand, supply and ...

Science and Economics Work Together Toward Environmental Improvement

From Reuters:

British biologist Ian Swingland took up the idea of trading commodities to fund afforestation programs after he witnessed the devastation caused by logging in the Malaysian rainforests of Borneo in 1998, two decades after his first visit there.

[...]

Now his company has bought about 10,000 hectares (25,000 acres) of Kangaroo Island, Australia's third-largest island, to demonstrate that afforestation can offer a major investment opportunity through trading in carbon credits.

"Conventional conservation is a disaster story," Swingland, the founder of Britain's Durrell Institute of Conservation and Ecology at the University of Kent, said in an interview.

"What isn't a disaster is where you make a business of it, and everybody's lives are improved by it, and we give them ownership of their own future."

I'll let the full story speak for itself--but I like the last line: "If you don't even have incentives, how can you get people to look after the environment?"

RGGI

From the NYT (Seven States ...):

New York, New Jersey and five other Northeastern states have formally agreed to join in the first mandatory regional program in United States history to cut greenhouse gas emissions from power plants.

RGGI is the Regional Greenhouse Gas Initiative, the region is the NE: Connecticut, Delaware, Maine, New Hampshire and Vermont, sans MASS and RI. Is it just me, or, is the adoption of what-used-to-be-radical -- tradeable emissions permits-based environmental policy -- becoming mundane?

Below the fold is a description of how the market will work from the NYT article. If you need more detail, check out the RFF sponsored webcast of a side event at the Montreal climate change conference. Even if you are not interested, the webcast is pretty cool in and of itself. It is 1.5 hours with 3 panelists, including RFF's Dallas Burtraw (one funny note: he called the MAC graph a "cartoon," I guess that is one way to avoid being a dismal scientist), and the slide show running next to the video, almost like you were there. I had it on in the background yesterday and learned a lot about RGGI. Here it is: The RGGI Model: Allocations, Offset, and Linkages.

The Value of a Reputation for Environmental Awareness

The perception of environmental consciousness is becoming increasingly valuable to firms and many are taking steps to promote their green business practices. Some observers, however, see this as little more than "greenwash" rather than substantive change:

It's Getting Crowded on the Environmental Bandwagon, by Claudia Deutsch, NY Times: Customers can't buy it. Shareholders can't invest in it. But a growing list of big-name companies appear to be spending ever-bigger chunks of their advertising budgets to promote it. A General Electric elephant, for one, high-stepped on national television right after the company introduced its Ecomagination line of products last May, dancing for joy at how G.E. is "in step with nature." It has been followed by four product-specific environmental ads and a spate of print ads...

Hunting Licences Revisited

On December 15, I posted a message concerning the purchase of hunting licences by environmental groups. The most interesting response I received came from Josh Corning who asked why the environmentalists thought they would have any greater incentive to protect the hunted species than would the guiding outfits who had previously owned the licences. After all, the licences sold for $1.35 million. Surely a guide who owned a million dollar asset would want to protect it.

So, I wrote to the Raincoast Conservation group to ask why they thought it was necessary to buy these licences, when the guiding outfits had a strong incentive to protect the animals they were hunting.

ANWR news flash

From the WSJ's Afternoon Report:

Republicans won that battle, but lost the next, falling four votes short of stopping a filibuster of a must-pass military spending bill that had been amended to include a provision allowing drilling in the Arctic National Wildlife Refuge. By attaching the ANWR provision to a military-spending bill, Republicans had hoped to force Democrats to make a politically unpopular vote in order to oppose ANWR drilling. Democrats and some Republicans called that a cynical ploy and launched the filibuster. Republicans had been talking about possibly using a limited version of the "nuclear" option -- a parliamentary tool to preempt filibusters -- but only temporarily, to get the ANWR provision passed. But after the initial vote to stop the filibuster failed, it appeared likely that Republicans would simply drop the ANWR provision altogether. Use of the nuclear option might have inspired Democrats to ratchet up their own resistance, setting the stage for an unhappy new year on Capitol Hill.

My Prediction for Hydrogen Fueled Vehicles

CNN.com has a video story on Honda's hydrogen car program.  If you want to see one in action, you can watch the video here--unfortunately you have to put up with an E-Trade commercial first.  In the video, Joe Romm--author of The Hype about Hydrogen--restates his claim that hydrogen vehicles won't be mass produced for at least another 20 years and probably longer.  Well, here's my prediction...

Top env-econ posts

Continuing the end of the year navel-gazing, and avoiding dealing with a red drum travel cost demand model with consumer surplus per trip of about $300, here are the top 20 "entry pages" (i.e., individual posts that other websites or blogs have linked to or found by a google, etc search) at www.env-econ.net (other than www.env-econ.net):

A humor break before the holidays

Thought our readers might enjoy this from Tony Auth at the Philadelphia Inquirer:

Six months ago today ...

... we started this blog with an incomplete sentence in the announcement (ouch, just noticed that). Since then 10+ bloggers have made 429 posts that have generated 2024 comments, 126 trackbacks and 58,000+ visits.

Thanks everybody!

And here are some more visitation stats and pics from Sitemeter.