Environmental Economics

Quote of the day: lack of preparation for winter storms

NYC Mayor:

“The furious hoarfrost bearing down upon us knows neither mercy nor reason, and all within the five boroughs will perish, cowering in their brittle dwellings ... This shall be a tempest the likes of which has never been glimpsed by man or beast. Clutch your babes close to your breast and take small comfort in knowing that they will howl for but a few hours before death becalms them forever.”

via www.theonion.com

Dude has a way with words.

Cognitive dissonance

Because transportation infrastructure is a gift from god?

A trio of state polls released this week show voters in states such as Georgia, New Jersey and Utah do not support an increase in their gas taxes to pay for new transportation projects. 

The surveys come as lawmakers in Washington are indicating a willingness to raise the 18.4-cents-per-gallon federal gas tax for the first time in 20 years. 

In Georgia, where drivers pay an additional 7.5 cents per gallon on top of the federal gas tax, according to the America Petroleum Institute (API), 60 percent of voters said they are opposed to paying more at the pump to pay for new transportation projects in a poll conducted by Landmark Communications, according to a report from Atlanta’s WSB. 

Similarly, 68 percent of New Jersey voters said they are opposed to a gas tax increase in that state, where drivers currently are paying an extra 10.5 cents per gallon to fill local transportation coffers, according to a Trenton Times report. 

Finally, in Utah, where drivers pay an extra 24.5 cents per gallon at the pump, only 35 percent of voters said they supported a gas tax increase, according to a report from Salt Lake City TV station KSL about a poll that was conducted by the Exoro Group. 

via thehill.com

In other survey questions respondents indicated:

• that they strongly agreed with the statement: the thrill of paying 40% less to fill up the car is close to the intense high that can only be received from illegal and highly addictive drugs,
• they were strongly dissastisfied with the amount road congestion during rush hour, the deterioration in quality of roads, the riskiness of bridges and levels of air pollution, and
• they strongly agreed that it is a damn shame when people experience no discomfort when holding two or more contradictory beliefs, ideas, or values at the same time, a damn shame. 

Friday beer post

Is it beer thirty yet? I need a drink:

The Senate on Thursday again voted to reject two measures related to the Keystone XL pipeline that declared that humans are a cause of climate change — the second set of votes on the issue in two days.

Senators are using the Keystone debate to argue over climate issues. The Democrats want to force their Republican colleagues to come out one way or another on whether they believe humans have a role in changes to the climate and the rise of global temperatures. Republicans telegraphed their intent to attack President Obama’s climate policy agenda.

Mr. Obama is expected to veto the underlying bill that would force federal approval of the Keystone pipeline and allow construction to begin. Still, the debate has led to the first Senate floor votes in eight years on climate change measures.

On Thursday, the Senate voted 56 to 42 not to take up an amendment offered by Senator Bernard Sanders, independent of Vermont, that declared that climate change is real, is caused by humans and wreaks devastation. The amendment also called on the federal government to lead the way in the national transition away from dependence on fossil fuels.

Senators voted 54 to 46 not to take up an amendment offered by Senator Joe Manchin III, Democrat of West Virginia, that also declared human-caused climate change to be real and devastating, and urged the government to support research on technologies that would capture carbon emissions from fossil fuels.

A third, Republican-sponsored amendment, which was rejected 51 to 46, was more political in nature. Offered by Senator Roy Blunt of Missouri, it called on the Senate to nullify a climate change agreement in November between the United States and China in which both nations pledged to reduce their carbon emissions.

via www.nytimes.com

When did Keystone XL get silly? 

Oh Maryland, My Maryland (sung with despair)

Press Statement
January 22, 2015

CBF: Sad Day for Maryland

(ANNAPOLIS, MD)—Alison Prost, Maryland Executive Director of the Chesapeake Bay Foundation (CBF), issued this statement following Governor Hogan's withdrawal Wednesday of the Phosphorus Management Tool and nitrogen oxides (NOx) reduction regulations:

"This is a sad day in the long fight to make Maryland waters clean enough for swimming and fishing. Governor Hogan's decision has hurt the rivers and streams on Maryland's Eastern Shore where 228,000 tons of excess manure will continue to be applied to farm fields each year, and to wash off into nearby creeks and river. The new governor rolled back 10 years of progress when he withdrew the Phosphorus Management Tool, a common sense, science-based solution to the manure crisis.

"Agriculture is the largest source of pollution to the Chesapeake Bay, and is also the cheapest to reduce by far. Many farmers deserve credit for their efforts to stem pollution from their barn yards and fields. But just as those who live in our cities and suburbs are doing more to clean the Bay, so must farmers.

"Businesses with technologies to help reduce phosphorus pollution from poultry manure are ready to come to Maryland and help ease the burden of excess manure. But these technologies will only have a significant impact if farmers are required to not apply excessive amounts of phosphorus to their crops. Regulations create demand for problem-solving technologies that otherwise would languish.

"Additionally, by withdrawing regulations that would have reduced pollution from coal-fired power plants, Governor Hogan's decision also has put corporate interests above the people of Greater Baltimore. Nitrogen oxides are linked to ozone which can be harmful to children and sensitive adults. As a greenhouse gas, nitrogen oxides are 300 times more powerful than carbon dioxide. Also, nitrogen from coal plants and vehicles adds millions of pounds of harmful pollution to the Bay each year. The power industry used the same hardship argument in 2006 when the legislature approved the Maryland Healthy Air Act. In the years afterwards, electricity prices dropped, and the industry prospered.

"The Chesapeake Bay Foundation welcomes the opportunity to work with the Administration to ensure farmers have the resources they need to implement the PMT, and all residents see cleaner water. But we can't compromise on science, or accept further delays on cleaning up Maryland's rivers, streams, and the Chesapeake Bay."

Oh Maryland, My Maryland (sung with despair)

Press Statement
January 22, 2015

CBF: Sad Day for Maryland

(ANNAPOLIS, MD)—Alison Prost, Maryland Executive Director of the Chesapeake Bay Foundation (CBF), issued this statement following Governor Hogan's withdrawal Wednesday of the Phosphorus Management Tool and nitrogen oxides (NOx) reduction regulations:

"This is a sad day in the long fight to make Maryland waters clean enough for swimming and fishing. Governor Hogan's decision has hurt the rivers and streams on Maryland's Eastern Shore where 228,000 tons of excess manure will continue to be applied to farm fields each year, and to wash off into nearby creeks and river. The new governor rolled back 10 years of progress when he withdrew the Phosphorus Management Tool, a common sense, science-based solution to the manure crisis.

"Agriculture is the largest source of pollution to the Chesapeake Bay, and is also the cheapest to reduce by far. Many farmers deserve credit for their efforts to stem pollution from their barn yards and fields. But just as those who live in our cities and suburbs are doing more to clean the Bay, so must farmers.

"Businesses with technologies to help reduce phosphorus pollution from poultry manure are ready to come to Maryland and help ease the burden of excess manure. But these technologies will only have a significant impact if farmers are required to not apply excessive amounts of phosphorus to their crops. Regulations create demand for problem-solving technologies that otherwise would languish.

"Additionally, by withdrawing regulations that would have reduced pollution from coal-fired power plants, Governor Hogan's decision also has put corporate interests above the people of Greater Baltimore. Nitrogen oxides are linked to ozone which can be harmful to children and sensitive adults. As a greenhouse gas, nitrogen oxides are 300 times more powerful than carbon dioxide. Also, nitrogen from coal plants and vehicles adds millions of pounds of harmful pollution to the Bay each year. The power industry used the same hardship argument in 2006 when the legislature approved the Maryland Healthy Air Act. In the years afterwards, electricity prices dropped, and the industry prospered.

"The Chesapeake Bay Foundation welcomes the opportunity to work with the Administration to ensure farmers have the resources they need to implement the PMT, and all residents see cleaner water. But we can't compromise on science, or accept further delays on cleaning up Maryland's rivers, streams, and the Chesapeake Bay."

I do not like them Sam I Am

From the inbox:

Dr. Haab, 

Always a good start. Flatter me with Dr. and you'll get my attention.

My name is [redacted so his friends don;t make fun of him] and I am a junior at the University of [southern state] majoring in Economics with a minor in FIlm Studies.

Film studies?  Really?  I watched a lot of movies in college, but I didn't know I could get credit for it.

A couple of weeks ago I decided to e-mail all of the department heads at U[SS] with one question: What is a book (fiction or non-fiction) you would recommend to college students to broaden their thinking and light an intellectual spark? 

'Broaden their thinking and light an intellectual spark?'  Bwahahahahahahahaha...

I loved the responses I got so I decided to expand the project a bit. The book does not have to necessarily have to be related to your field of expertise. I am just very curious to see the answers that will be produced from a group of highly educated people with a diverse group of interests. 

Oh, you're serious. 

OK, here goes (yes, this was my response):

Great and interesting question.  I am going to give your question more thought, but I wanted to send you my initial reaction (I often tell my kids and students to trust their instincts, so I might as well trust mine).  I know many people might respond to your question with a book that will attempt to sway students to their way of thinking.  I simply don’t think that way.  My goal as an educator is to expand a students’ way of thinking. My hope is that students will use their knowledge to find new paths, for themselves and for others.  The goal of education should not be to teach everyone to think the way everyone has always thought, but rather to teach people to think in new ways; respectful, but not beholden to the thoughts of their predecessors.

I can think of no book that lays this out better than ‘Oh, the Places You’ll Go,’ by Dr. Seuss.

 “You have brains in your head.
You have feet in your shoes.
You can steer yourself
any direction you choose.
You're on your own. And you know what you know.
And YOU are the guy who'll decide where to go.”

Oh, and yes, I'm serious.

“It starts by admitting you have a problem ... "

My problem is I want to conduct extraneous empirical analysis: 

The Senate on Wednesday voted that “climate change is real and is not a hoax” as Democrats used the Keystone XL pipeline debate to force votes on the politically charged issue ahead of the 2016 elections.

The “hoax” amendment to the pipeline bill from Sen. Sheldon Whitehouse (D-R.I.) passed 98-1, with only Mississippi Sen. Roger Wicker, the chairman of the Senate Republican campaign arm, voting “no.”

In a surprise, the Senate’s leading skeptic of climate science, Sen. James Inhofe (R-Okla.), voted in favor of the amendment — but made clear he doesn’t believe humans are the primary driver of climate change. ...

Republicans backed Inhofe’s stance in a second vote, rejecting an amendment from Sen. Brian Schatz (D-Hawaii) that stated, “climate change is real and human activity significantly contributes to climate change.”

The “significantly” in the provision is what many Republicans pointed to as a point of contention as they blocked the amendment in a 50-49 vote, short of the 60 that was needed for approval. ...

In an attempt to provide political cover for Republicans, Sen. John Hoeven (R-N.D.) put forward an alternative that expressed the sense of the Senate that the Keystone oil pipeline would not significantly impact the environment or contribute to global emissions. The provision included a line stating that humans contribute to climate change but without the word “significantly.” 

Fifteen Republicans voted for that amendment ...

Sen. Bernie Sanders (I-Vt.) ... said the Senate would vote Thursday on his amendment, which goes one step further by stating that climate change is “already causing severe problems all over the world, we have a window of opportunity and we have to transform our energy system away from fossil fuels to energy efficiency.”

Wednesday’s votes came after senators duked it out on the Senate floor in a wide-ranging debate over climate change and its relationship — or lack thereof — to the $8 billion pipeline project, which is undergoing federal review.

“It starts by admitting you have a problem, just like many other areas of human life,” Whitehouse said of Republicans’ skepticism on climate change.

via thehill.com

In case you want to write a paper on all this, I'll get you started. Here is the linear probability model of the votes on the Hoeven amendment regressed on ideology and political party using data from govtrack.us. The dependent variable equals 1 for yea and 0 for nay. Political party and ideology, which ranges from zero (liberal) to one (conservative), explains 62% of the votes. 

 

"Keystone marathon begins in Senate" [and at this blog]

I've always wanted to complete a marathon:

The Senate on Tuesday began what is expected to be a weeks-long debate over the Keystone XL pipeline by holding a trio of amendment votes.

Out of the three amendments proposed, only one — Republican Sen. Rob Portman's (Ohio) trimmed down version of an energy efficiency bill — passed, in a 95-4 vote. ...

Senators on Tuesday agreed to take up another six amendments, with votes set to begin Wednesday.

Democrats offered two climate change-related amendments. One of them, from Sen. Brian Schatz (D-Hawaii), says climate change is real and significantly caused by humans. The second, from Sen. Sheldon Whitehouse (D-R.I.), simply states that,“"climate change is real and not a hoax."

Schatz said the amendments are about "laying down a predicate that asks people what side of basic science and facts they are on."

Republicans are broadly skeptical of the scientific consensus on climate change, arguing the extent to which it is caused by human activity is overstated.

Democrats in response have taken to labeling the GOP a party of “climate deniers” and say Republicans will pay the price at the ballot box in 2016 for their stance.

via thehill.com

It is going to be fascinating. Let me be the first one to suggest a paper analyzing the votes on the climate denial amendment. The key independent variables would be political party, the amount of oil and coal (per capita) produced in the state, etc.

I'll buy a beer for anyone who submits this as an abstract to the AERE sessions at the 2015 SEA meetings [call for papers dot pdf]. 

When was the last time the Senate voted 91-5 on anything of substance?

Were four Senators already out there campaigning for President? 

The Senate on Tuesday overwhelmingly approved an amendment to the Keystone XL pipeline bill that is aimed at improving energy efficiency in buildings — a rare moment of bipartisan agreement in a tense debate that is nowhere near being settled.

Lawmakers voted, 91 to 5, to add the popular energy-efficiency provision to a contentious bill that would approve construction of the Keystone pipeline.

The amendment, offered by a Republican, Rob Portman of Ohio, and a Democrat, Jeanne Shaheen of New Hampshire, is backed by President Obama and has broad support among members of both parties in Congress. But the measure will almost certainly languish in Congress for months before it can become law as part of the Keystone bill or as a stand-alone measure. ...

The measure is intended to cut homeowners’ energy use, utility bills and carbon footprints by, among other proposals, making it easier for consumers to buy “smart-metered” water heaters and cheaper for manufacturers to build energy-efficient cooling and heating systems. It would also create incentives for the owners of commercial buildings and their tenants to reduce their energy use.

via www.nytimes.com

After a ton of searching (5-10 minutes) I couldn't find what might be used to "cut homeowner's energy use ..." and "making it easier for consumers to buy ...." Any information out there in readerland?

My guess is, since the vote was overwhelmingly in favor, that, if incentives are involved, it involves subsidies to homeowners and not taxes. 

"A Carbon Offset Market for [Tropical Forests]"

Time to update the encyclopedia (don't follow that link unless you can stomach self-promotion):

Tropical forests store huge amounts of carbon. When their trees are cut or burned, the carbon is eventually released into the atmosphere, mixing with oxygen to form the long-lasting greenhouse gas carbon dioxide. The pace of deforestation is so great today that it accounts for an estimated 12 to 15 percent of global carbon dioxide emissions annually.

Economic forces drive this destruction — for timber, rangeland, mining and development. But there is also a powerful economic argument for preservation. Forests’ carbon reserves can be monetized and sold as offsets to greenhouse gas emitters who need them to comply with regulatory emissions limits, or who voluntarily want to reduce their carbon footprint.

These offsets typically are sold by utilities or other industrial companies that have reduced their emissions below a government-imposed cap. The offsets equal the emissions below the cap; their price is determined by supply and demand. The buyers are companies whose emissions are above the cap; the offsets are subtracted from their excess emissions, enabling them to avoid penalties. There is also a voluntary market where companies and individuals buy offsets to reduce their carbon footprint. The revenue is used to finance energy efficiency and other projects to reduce emissions.

These markets are booming, with trades each year in the tens of billions of dollars. But a potential pool of offsets has been largely left off the table — offsets that represent carbon emissions avoided by not destroying tropical forests. These were difficult to value because there was no way to accurately quantify the carbon savings. Nor were there reliable, transparent systems to ensure these forests would remain standing or that proceeds would be returned to local communities.

For those reasons, the European Union, which has the world’s largest system for trading carbon offsets, has not allowed offsets for what’s known as avoided deforestation. Other carbon markets, like the one run by the California Air Resources Board, are considering it.

The objections are now being addressed. In recent years, accurate and inexpensive techniques have been developed to quantify and verify carbon emissions that would be avoided by not destroying forests. Credible mechanisms for indemnifying offset credits (meaning, an acre of forest will always be protected even if the specific acre behind the credit is destroyed) and returning the proceeds from the sale of the offsets to local communities have also been devised. A new system that combines all of those components and biodiversity conservation, known as the Rainforest Standard, which we and 60 other scientists, lawyers and businesspeople have developed, is now being tested in South America to safeguard a 1.6-million-acre forest. ...

via www.nytimes.com

Following the link:

The Rainforest Standard’s underlying principle is that emission reductions must be permanent to justify credit revenues, and reductions will not be permanent unless economic benefits flow fairly to all local forest users and owners, who would otherwise have no stake in their permanence.