Three Climate Change Hypotheses - Only One Of Which Can Be True

Roger Pielke Sr., Climate Science

The climate issue, with respect to how humans are influencing the climate system, can be segmented into three distinct hypotheses. These are:

• The human influence is minimal and natural variations dominate climate variations on all time scale;
• While natural variations are important, the human influence is significant and involves a diverse range of first-order climate forcings (including, but not limited to the human input of CO2);
• The human influence is dominated by the emissions into the atmosphere of greenhouse gases, particularly carbon dioxide.

The third hypothesis, of course, is the IPCC perspective.

The challenge to the scientific community, using the scientific method, is to present observational evidence that refutes one or more of these hypotheses.

Climate Science’s perspective is that the second hypotheses is correct, which has support from the

National Research Council, 2005: Radiative forcing of climate change: Expanding the concept and addressing uncertainties. Committee on Radiative Forcing Effects on Climate Change, Climate Research Committee, Board on Atmospheric Sciences and Climate, Division on Earth and Life Studies, The National Academies Press, Washington, D.C., 208 pp.

A new Nature paper by Keenlyside et al entitled “Advancing decadal-scale climate prediction in the North Atlantic sector” provides evidence that is inconsistent with the third hypothesis. This paper writes in the abstract

“The climate of the North Atlantic region exhibits fluctuations on decadal timescales that have large societal consequences. Prominent examples include hurricane activity in the Atlantic, and surface-temperature and rainfall variations over North America, Europe and northern Africa……Our results suggest that global surface temperature may not increase over the next decade, as natural climate variations in the North Atlantic and tropical Pacific temporarily offset the projected anthropogenic warming.”

There are several important messages from this paper:

• While this Nature paper claims that this lack of global warming is temporary due to “natural climate variations“, unless the first hypothesis is true, there are NO climate variations that are not affected by humans (i.e. the term “natural climate variations” is therefore a misnomer).  
• This new paper supports the perspective that climate variations and change (even the global average radiative imbalance) are dominated by regional alterations in circulations [as summarized in the 2005 National Research Council Report, and emphasized on Climate Science and associated papers (e.g. see) including the very important guest weblog on Climate Science by Roy Spencer (see) on this subject].
• Since the multi-decadal global climate model predictions used for the 2007 IPCC report are failing to skillfully predict these “flucuations on decadal time scales”, there is no credible reason to accept the claim in the Nature paper that the “projected anthropogenic warming” will be accurately predicted after the next decade.

That’s exactly what Montgomery County (Md.) Council member George Leventhal firmly leaves no doubt about in his letter to the WaPo that appeared in yesterday’s Montgomery Extra section. 

"Frustrated by ineffective federal and global efforts to combat climate change, many local and state governments are adopting their own plans. In this region, Montgomery County led the way, investing in clean, renewable energy and encouraging its residents to do so. But this leadership may now be at risk because of a declining economy and an austere budget."

Tax increases anyone?

Redundant as it may be, the rest of the County Council are acolytes of the Goreacle and they proved it when they binged on the AGW hallucinogen on Earth Day.  Here’s the lead of the Council’s press release:

Montgomery Council Celebrates Earth Day By Approving 7 Global Warming Bills

Montgomery to Become Nation’s First County to Require EPA’s ‘Energy Star’
Standards for New Residential Construction

ROCKVILLE, Md., April 22, 2008—The Montgomery County Council today celebrated Earth Day 2008 by passing seven bills that combine to form one of the nation’s foremost global warming programs by a County government. An amendment offered by Councilmember Roger Berliner, chief sponsor of the bills, will require new homes built in the County to meet the Environmental Protection Agency’s “Energy Star” standard. That will make Montgomery the nation’s first county to adopt such legislation.

This will cost the overburdened taxpayers and despite the County Government’s crocodile tears about "affordable housing" it sure as hell won’t make building or buying a house in MoCo any more "afforddable."

One luxury of being a Rockefeller is that you are wealthy enough to live in style even if Exxon’s performance starts to slide. The same can’t be said of millions of pensioners and small investors for whom Exxon’s profits may be the main source of a secure retirement. If John D.’s heirs aren’t satisfied with Exxon, they’re welcome to invest elsewhere. Our guess is that few will, given how much money they’ve made over the decades on fossil fuels.

Exxon Agonistes
Wall Street Journal
May 2, 2008; Page A14

Department of Irony: On Tuesday, members of the Rockefeller family won media huzzahs for airing their grievances against Exxon Mobil, the oil and gas giant in which they are the oldest continuous shareholders but which they say isn’t doing enough to prepare for a greener world. Then yesterday, Exxon reported a 17% rise in first-quarter profit, to $10.9 billion. It was merely the second-largest quarterly profit in U.S. corporate history, though Exxon still holds the quarterly and annual records.

Could it be that the heirs of John D. Rockefeller’s Standard Oil empire (founded 1870) are angry that Exxon’s management made them too much money? Probably not. Instead, the family warns that the company will lose out to competitors in the future if it doesn’t shift its climate-change policies and invest more in alternative energy. Along with institutional investors like Connecticut’s state pension fund, the Rockefellers are pushing corporate governance reforms that they say will give the Exxon board a more "independent" tilt.

Despite – or perhaps because of – their handsome returns, a large part of this exercise seems to be political. The well-to-do Rockefellers have embraced the eco-enthusiasms of the day, and perhaps for some of them this is one way of assuaging any guilt over a multibillion-dollar fortune built on carbon. One of their clan, Senator Jay Rockefeller of West Virginia, blazed this trail in 2006 with a letter demanding that Exxon management cut off funding for global warming skeptics – or else.

But even if they’re not dressing up their political goals as concern about Exxon’s long-term viability, it’s useful to ask whether their agenda serves the interests of all shareholders, which is maximizing returns on investment. Certainly Exxon’s earnings are high in absolute terms, given surging crude oil prices, but they have to be compared to the huge capital requirements for exploration and development. In 2007, the company spent nearly $21 billion on exploration and capital spending, and that will increase by at least 20% over the next five years or so.

Such long-range strategy to span both up and down cycles is essential because profits fall when commodity prices dip. That happened in the 1990s, with oil crashing below $20 a barrel after the altitudes of the 1970s. The oil majors and their shareholders swallowed these declines, as they should have.

Against such market fluctuations and supply shocks, what’s distinguished Exxon is its discipline. The company is known for its careful budgeting and for avoiding speculative risks. More than others, Exxon seems to be guided by the fact that the current historic rise in oil and gas prices won’t last forever, and that its spending decisions need to make sense in a world of $60 or even $30 per barrel oil. Such business prudence has paid off. Exxon’s earnings per dollar of sales stood at 10% for 2007, compared to 8.3% for the larger oil and gas industry and 7.8% for the Dow Jones Industrial Average for major industries.

It’s the prerogative of shareholders like the Rockefellers, even those without a major equity stake, to second-guess Exxon’s results. Still, they’ve also got plenty of other investment opportunities, and they’re welcome to try out Vinod Khosla and the other venture capitalists pursuing "clean tech." But these energy sources still can’t compete economically with oil despite government handouts and other regulatory props, and the Chapter 11 courts are littered with companies that made such energy bets.

Anyway, a company that specializes in oil and gas isn’t necessarily the best situated to operate, say, wind turbines. It may lack the expertise, or the fads might divert management focus from the main business. But even if Exxon chose to diversify more into alternatives, it would still be far more profitable to continue providing a product that the world can’t do without. The notion that the carbon era is coming to an end is for the foreseeable future little more than a fantasy. Everyone – from the U.S. Energy Information Agency to the U.N. – agrees that fossil fuels will still account for as much as 80% of the world’s energy needs though 2030, even with efficiency gains and major growth in alternatives.

The chief specific Rockefeller goal seems to be to sever the roles of CEO and chairman of the Exxon corporate board, both currently filled by Rex Tillerson. There are plenty of cases where that division of labor works and makes good business sense. But it is not a self-evidently superior arrangement. While it’s never a good idea for a CEO to "own" his board, the last thing a business needs is a board operating at cross-purposes with management – in this case, presumably, with management wanting to continue with its record-breaking model, and a board beholden to every environmental interest group that happens to pass by.

One luxury of being a Rockefeller is that you are wealthy enough to live in style even if Exxon’s performance starts to slide. The same can’t be said of millions of pensioners and small investors for whom Exxon’s profits may be the main source of a secure retirement. If John D.’s heirs aren’t satisfied with Exxon, they’re welcome to invest elsewhere. Our guess is that few will, given how much money they’ve made over the decades on fossil fuels.

Charcoal in Burned Forests No Way to Store Carbon
A 10-year experiment shows that trees turned to charcoal may release more carbon than previously thought

By David Biello, SciAm

The boreal forests in the north of Canada, Russia and other countries that ring the Arctic burn every summer after lightning strikes their towering trees, releasing tons of carbon dioxide into the air as they turn to ash and charcoal in the flames. Some scientists have argued, however, that this climate-changing natural disaster might not be all bad from a global warming perspective: Charcoal is a stable way to store carbon in the ground, where the carbon-rich charcoal can safely stay for hundreds if not thousands of years. Or at least that’s the theory of so-called biochar. A new study published today in Science shows that such charcoal may not keep as much carbon in the soil as previously believed.

The electrically charged surface of charcoal—the reason it is used in filters—absorbs simple organic compounds that, in turn, "serve as a good food source for microbes," says ecologist and study coauthor David Wardle of the Swedish University of Agricultural Sciences. "Because these compounds are carbon-rich, and are rapidly broken down by microbes on the surface of the charcoal, we get great accelerated [carbon] loss." In other words, instead of trapping carbon in the soil, charcoal, along with microbes, accelerates its release back into the atmosphere.

The ecologists discovered this by leaving hundreds of bags containing either pure charcoal, or the natural leaf litter of the forest floor, or a mix of charcoal and leaf litter at three sites in Sweden for a decade. They report that when they retrieved the bags in 2006, the contents of the bags with the mixture—the most like natural conditions after a forest fire—had shrunk by nearly 25 percent and lost a significant portion of their carbon within the first two years of the 10 year period.

The pure coal, however, remained nearly unchanged. "The amount of soil [carbon] lost as a result of adding charcoal to soil will likely partially counteract the amount of [carbon] sequestered by the charcoal itself," Wardle says.

Some experts have proposed using such charcoal, or biochar, as a way of offsetting the extra carbon dioxide emissions from a forest fire and dead trees. In fact, some have proposed that the vast swathes of forest killed in recent years by the pine beetle in Alaska and western Canada should be turned into such biochar.

But Wardle warns that rather than serve as a carbon sink, trees turned to charcoal could end up releasing even more carbon dioxide from the forest floor.

This does not mean that biochar might not find useful applications in agriculture, where it may enhance soil fertility as well as cut down on carbon emissions. "The most useful and easiest [place to apply biochar] would be to apply the biochar to agricultural soil that does not have a litter layer such as the one studied by the authors," says biogeochemist Johannes Lehmann of Cornell University, who studies the ancient biochar practices of the historical inhabitants of the Amazon.

But that means more research is needed to determine whether more carbon is captured or released using this process. Wardle says it’s particularly important to see whether his findings apply to other ecosystems and types of charcoal. "In other words, is what we found a widespread phenomenon and is it ecologically important?"

And some citizens have called for lynching but I think they’re equally safe — Australia will not (cannot) turn its back on the resources boom which means you can kiss your emission reductions goodbye.

Garnaut calls for binding targets
 
Matthew Warren, Environment writer, The Australian | May 02, 2008

DEVELOPING countries need to be set "demanding and binding" emissions targets as part of an aggressive upgrade to global action on climate change signalled by Australia’s and Britain’s lead greenhouse policy advisers.

In two new separate papers, Ross Garnaut and Nicholas Stern have called for deep cuts in developed country emissions by 2020 and substantial reductions by developing countries to stabilise greenhouse gases at manageable levels.

Launching his latest climate report in London on Wednesday, Sir Nicholas, former chief economist for the World Bank, said developed countries must cut emissions by 80 per cent by 2050.

In February, Professor Garnaut suggested cuts as deep as 90per cent may be needed to avoid the risk of dangerous climate change, flagging that these should be allocated on a per capita basis.

Their tag-team reports directly contradict the communique from the Bali negotiations last December, which bowed to pressure from developing countries that insisted they make only voluntary cuts in any post-2013 global emissions deal.

Global talks leading up to a crucial UN meeting in Copenhagen next year are expected to negotiate targets as part of a deal to replace the Kyoto Protocol, which ends in 2012.

On Monday, Russian climate negotiators said they had no intention of accepting a binding cap on greenhouse emissions. Russia’s ratification of Kyoto was pivotal to the deal coming into force in 2003.

The world’s biggest greenhouse gas emitter, China, is reluctant to accept binding targets while fast-growing India is steadfast in its opposition, claiming any constraint on emissions would hinder economic growth.

In a new academic paper released this week, Professor Garnaut says global emissions are growing 14 per cent faster than the highest projections by the Intergovernmental Panel on Climate Change.

As a result, developed countries will need to cut emissions by 26 per cent by 2020 to reach the highest level of greenhouse gases stabilisation, and up to 40 per cent to be sure of avoiding increases of more than 2C.

"Cuts of such dimensions will not be made in a framework of voluntary action," the paper concludes. "They will only be made if major developing countries also become subject to demanding and binding targets."

The Garnaut paper argues that developing countries will need to "bring down emissions very substantially below business as usual" by 2020.

"Without all major emitters binding themselves to economy-wide targets or policies, given rapid emissions growth, the prospects for the global climate change mitigation are bleak," the report says.

Sir Nicholas’s new report, Key Elements of a Global Deal on Climate Change, says developing countries will need to set their own targets by 2020.

He argues the solution requires the rapid expansion of global carbon markets and massive investment in low-emission technologies, while rich countries will need to bear the brunt of the reforms.

A spokeswoman for Climate Minister Penny Wong said the Stern report was another reminder of the scale of the challenge and the need for a global response.

Former lead Australian climate negotiator and head of ABARE, Brian Fisher, said it was "virtually impossible" to expect to negotiate targets for developing countries by 2020.

Lawmakers see red over green-car amendment           
Richard Simon - LOS ANGELES TIMES   

WASHINGTON — Rep. Elton Gallegly of California likes his taxpayer-funded Ford Expedition. He isn’t worried that it’s not the most fuel-efficient car. It’s reliable, suits his mountainous district and is cheaper to lease than many other vehicles."It’s not a Cadillac. It’s not a Lincoln. It’s a Ford," the Republican congressman said with exasperation.

But like it or not, Gallegly and other lawmakers will have to give up gas-hungry SUVs and luxury sedans for leased vehicles that are more eco-correct, such as Toyota’s Prius.

And some are in a high-octane fit about it.

"A Prius isn’t made in the United States," Gallegly complained.

Congress has been bearing down to do more about global warming. But a little-noticed amendment to last year’s energy bill has hit especially close to home. It requires House members who lease vehicles through their office budgets to drive cars that emit low levels of greenhouse gases.

Among the victims: Texas Republican Joe Barton, who will probably have to give up his Chevy Tahoe, despite his protests that it is made in his district. "I guarantee you my district is not upset that I’m driving a Chevy Tahoe," he said.

The effort to steer lawmakers into vehicles that get better mileage comes as Congress has mandated more fuel-efficient vehicles for the public and pump prices have surged.

The requirement was sought by Rep. Emanuel Cleaver, D-Mo., who figured that if his colleagues were serious about reducing greenhouse gas emissions and U.S. dependence on foreign oil, they ought to put their foot where their mouth is.

Cleaver does. The taxpayer-funded Ford Econoline, a recycled airport shuttle he uses as a mobile office, runs on cooking grease. But he’s heard grumbling from colleagues.

"They want their Lexuses and their Cadillacs," he said. "I just think it’s a poor example for us to spend so much time talking about energy independence and global warming and presenting to the people an image of fat cats living the fat life," he said.

Overall, about 130 of the 435 House members lease vehicles, according to an analysis by the Los Angeles Times and the nonpartisan Taxpayers for Common Sense.

Under the legislation, the Environmental Protection Agency will determine which vehicles lawmakers will be allowed to lease, a list that’s expected before the end of the year. Senators are not allowed to use their office budgets for long-term vehicle leases. Lawmakers can seek mileage reimbursements when they use their own vehicles for congressional business.

The EPA’s list could include vehicles such as the Ford Escape hybrid, the Mercury Mariner hybrid and the Prius, which received high scores on EPA’s "Green Vehicle Guide." The guide rates vehicles based on greenhouse gas emissions on a scale of zero to 10, with 10 being best.

The lease requirement passed narrowly in August after a brief debate, with most Democrats supporting it and most Republicans opposing it.

Reaction to the requirement has varied.

Some Republicans lashed out at Democrats, accusing the House leadership of hypocrisy.

"I will start driving a green car once Pelosi starts ballooning back and forth from coast to coast to save jet fuel," said Rep. Tom Feeney, R-Fla., referring to House Speaker Nancy Pelosi, D-Calif., who has made climate change a top priority.

Pelosi spokesman Drew Hammill said the Chevy Suburban the speaker uses was selected by the Sergeant at Arms, who oversees her security. But he noted that she has asked that her next vehicle be a hybrid.

The requirement has drawn criticism from Democrats as well.

Rep. John D. Dingell, D-Mich., the longest-serving House member, drives a Ford Escape hybrid leased by his campaign, but voted against the requirement because "historically members have been held accountable by their constituents for these types of actions," said his spokeswoman.

Other lawmakers say their districts require sturdier vehicles.

Patrick Creighton, a spokesman for Rep. John Peterson, R-Pa., who leases a flex-fuel Chevy Tahoe, said that the congressman’s district is large, with mountainous terrain covered with snow part of the year — "not the type of terrain a Mini Cooper was built to cover."

A number of lawmakers scoffed at the requirement, saying that forcing lawmakers into less-polluting vehicles would do almost nothing to influence climate change and suggested that Congress could take more significant action to reduce oil imports.

Teachers, leave my kids alone! — A mother says all parents need to pull their kids out of anti-science classes
Junkfood Science

A mother has finally had it with misguided “health” and “nutrition” classes in school and scouting programs, and their anti-obesity and “healthy eating” lessons. They aren’t about health or nutrition and are harming young people, putting them at risk for disordered eating, along with heightening self-consciousness about their bodies. She is calling for ALL parents to pull their kids out of these anti-scientific lessons for the sake of all children.

Laura Collins, the mother of an anorectic child, writes:

How "healthy" is Health Class?

It used to be "sex ed" that worried parents, but among parents of kids who have suffered with disordered eating, it is "Health" class that scares us. Many children start dieting, restricting food groups, and moralizing about food and fat after misguided "Nutrition" classes in our age of obesity hysteria. They show "Super Size Me" and assign "Fast Food Nation" to teens already so self-conscious about their appearances they they’d sell their souls and their siblings to achieve an appearance they think their peers will find pleasing.

My son just brought home a sheet from Cub Scouts asking him to track everything he eats and each item’s calorie count, something we consider a disordered eating behavior around here. (We won’t be doing it. Calls will be made.)… My son says "all my teachers talk about calories all the time and getting fat."

Parents of kids with eating disorders often have their children pulled out of health classes, body fat testing, BMI checks, and other "triggering" experiences. I think this isn’t enough. We ALL need to pull our kids from these anti-scientific lessons for the sake of all children.

There is no evidence that the kids who take these messages to heart are in need of them in the first place. There is no evidence that these "classes" change weights or behaviors in the long run - except in precipitating unhealthy dieting behaviors. "Do no harm" should apply to education, too.

Overwhelming and consistent evidence continues to show these school nutrition policy initiatives and the CDC’s “Guidelines to promote lifelong healthy eating and physical activity” being enacted in schools cross the country do not improve children’s diet’s, activity levels or health outcomes, or reduce obesity levels. Similar conclusions were reached by the U.S. Preventive Services Task Force and the Institutes of Medicine after reviewing 6,900 studies. Even the government’s own statistics negate the need for this focus, as there have been no significant increases in the numbers of children considered “overweight” since 1999-2000 and children are healthier, their diets better, and the CDC expects today’s children to live longer than at any other time in our history.

Read more…

Whatever happened…? And chromium - Are you getting enough?
Junkfood Science

Two quick follow-ups of stories that might have left you curious about what happened.

The Food and Drug Administration has completed its analysis of those dietary supplements being sold as “Total Body Formulas” and made a troubling finding.

In March, as you may remember, the FDA had issued a warning to consumers to not use these products after receiving dozens of reports of adverse reactions. The CDC issued a similar health advisory last month. Today, we learn that there have been 195 confirmed cases of adverse health reactions among people who had used this supplement.

Read more…

Africa Does Not Have to Starve
By NORMAN BORLAUG and ANDREW NATSIOS
Wall Street Journal, May 2, 2008

Rapidly increasing world food prices have already led to political upheaval in poor countries. The crisis threatens to tear apart fragile states and become a humanitarian calamity unless countries get their agricultural systems moving.

Now, with conference committee negotiations over the final shape of the Farm Bill at a critical stage, Congress needs to change the foreign food-aid program and help avert this calamity. The Bush administration has urged, rightly, that the U.S. Agency for International Development (USAID) be allowed to buy food locally, particularly in Africa, instead of only American-grown food.

The U.S. government currently buys grain and other foodstuffs from American farmers for free distribution in poor countries where a disaster has occurred, or sells it in food-deficit nations to generate funds for food-security development programs. Under the law, the food must be shipped almost exclusively on American vessels.

Ocean shipping costs are 20%-30% of the food-aid budget; and it takes on average over four months to order, buy, ship, offload and transport food by ground. In a famine, people can die waiting for the food to arrive.

Other problems arise. One food shipment sunk in a storm off the coast of Asia in 1996. In 2006, two food shipments were hijacked by pirates off the coast of Somalia. Hurricane Katrina nearly shut down much of the foreign food-aid delivery system in the Mississippi Delta.

Purchasing food locally simplifies the process, cuts down the time delay in delivery, reduces the logistical risks, and saves transport costs. These savings can be used to buy more food. At the same time, higher prices will probably reduce the purchasing power of USAID’s food-aid programs by at least $200 million this year. While President George W. Bush has released food aid from a reserve fund, it is not sufficient.

Direct food purchases in local countries could also help improve their agriculture. In Africa, for example, two-thirds of the 200 million people who suffer hunger are small-scale farmers, primarily engaged in subsistence production because they find too few buyers for any larger harvest.

In Ethiopia in 2003, for example, widespread drought occurred in the low-lying areas of the country and the very dry northern highlands. Some 12 million to 15 million people were at risk of hunger and starvation. But in the central and southern highlands of Ethiopia, farmers were producing a bumper crop of corn and other cereals. Yet with no market for the locally produced grains, prices collapsed.

If USAID could have purchased and helped distribute some of this excess, up to 500,000 small farmers would have benefited, as well as the millions at risk of starvation. But its only option was to import surplus food grain from the U.S.

Seventy-five percent of USAID food aid goes to Africa, the most food-deprived region of the world. More robust agricultural growth there will help in a period of rising food prices. More prosperous African nations will become better trading partners, expanding imports of U.S. agricultural commodities, machinery and technology. Any near-term losses will lead to longer-term gains for the American economy.

What we are advocating is already in place. The World Food Program, the food-aid agency of the United Nations, has been buying food in African agricultural markets successfully for years using European aid funding, while Canada announced this week they were moving to 100% untied food aid.

The Bush administration’s reform would have little or no impact on U.S. grain markets. President Bush urged action on his reform before the General Assembly of the U.N. and in his State of the Union address. Even if this authority were exercised fully, it would equal 0.3% of U.S. agricultural exports and a much smaller fraction of U.S. agricultural production.

Congress should amend the Farm Bill to allow up to 25% of the appropriation for USAID’s food-aid program to be used to purchase food locally, when the program’s administrator deems it appropriate to do so. A great many people’s lives depend on this reform.

Dr. Borlaug won the Nobel Peace Prize in 1970. Mr. Natsios, former administrator of USAID, teaches at Georgetown University.

Bush seeks millions in food aid

Washington Times
May 2, 2008

By Patrice Hill and Jon Ward - President Bush yesterday asked Congress to authorize $770 million to ease the global food crisis, most of which will be focused on Africa, while the administration denied that corn-for-ethanol subsidies are a major cause of the worldwide surge in food prices.

"We’re sending a clear message to the world that America will lead the fight against hunger for years to come," Mr. Bush said in a statement to reporters in the White House.

But agricultural experts testified on Capitol Hill yesterday that high food prices are here to stay, as robust demand for food worldwide collides with record fuel costs to put unprecedented pressure on food prices.

Although the prices for basic foods like corn, wheat and oil have been soaring, the prices paid to farmers are only a small part of what consumers pay at the store. As much as 75 percent of the retail price of food can be attributed to processing, packaging, transportation and distribution. These costs have also risen substantially, mainly because of high fuel prices.

"With the average food item traveling more than 1,500 miles before reaching the final consumer, it is no wonder that food costs are increasing," Tom Buis, president of the National Farmers Union, told the Joint Economic Committee. "When looking back over the last seven years, gasoline prices have increased 198 percent and diesel fuel prices have increased almost 250 percent."

The cost of food globally has spiked 43 percent in the past year, Edward Lazear, chairman of the White House Council of Economic Advisers, said on a conference call with reporters.

Government energy-policy supports for ethanol, which raises the demand for corn and thus its price, also have come under fire to the point that The Washington Times reported yesterday that Congress is considering cutting them.

But Mr. Lazear and White House spokesman Tony Fratto both criticized the notion that ethanol production is a main cause of rising food prices, and both the White House and the congressional witnesses offered a barrage of other, longer-term factors.

"The bottom line is that we think ethanol accounts for somewhere between 2 and 3 percent of increasing global food prices," Mr. Lazear said.

An American Farm Bureau Federation analysis found that 44 percent of rising food costs are due to rising prices for natural gas and fuels used to make fertilizer and to run farm machinery as well as to process foods and to transport them to market. The bureau said the farmer’s share of retail food prices has been at about 25 percent since the 1970s.

"After many commodities leave the farm gate, high costs for energy, fuel and transportation are added and passed onto the consumer," bureau president Bob Stallman told Congress. "Increased retail prices can especially be seen on highly processed foods."

In his announcement of increased food aid, the president also called on countries both rich and poor to lower restrictions on agricultural trade, including some developing nations that are banning food exports and thus discouraging production of food, leading to shortages and higher prices.

"Some countries are preventing needed food from getting to market in the first place, and we call upon them to end those restrictions to help ease suffering for those who aren’t getting food," Mr. Bush said.

He also called for other nations to reduce barriers to genetically modified foods.

"These crops are safe, they’re resistant to drought and disease, and they hold the promise of producing more food for more people," Mr. Bush said.

The $770 million would be part of the fiscal 2009 budget and therefore not be available until October, but White House officials said aid groups would benefit from the advanced knowledge of such a large amount. Mr. Bush said the U.S. is set to give $5 billion toward global food relief this year and next year.

The new money will be divided into three parts: $395 million will go to emergency food aid, $225 million to disaster assistance, and $150 million to development assistance. The Bush administration last month announced that $200 million would be made available for food relief through the Department of Agriculture’s Bill Emerson Humanitarian Trust.

House Speaker Nancy Pelosi, California Democrat, said, "The Congress will respond rapidly to the growing urgent need for international food assistance.

"This is not only a humanitarian issue; it is a matter of national security as well," she said.

In his congressional testimony, Joseph Glauber, chief economist at the Agriculture Department, said food trade worldwide is being transformed by the rise of the middle class in China, India and other fast-growing countries. Their increased appetite for meat, which requires greater use of grains for animal feed, has spawned an era of permanently higher prices, he said.

"High incomes are increasing the demand for processed foods and meat," he said. "These shifts in diet are leading to major changes in international trade," including increasing use of the world’s corn, wheat and soybean crops for animal feed.

The resulting shortage of supplies has caused countries that previously were major exporters of food staples — including Argentina, China, India, Kazakhstan and Vietnam — to stop exporting and even to impose taxes on exports that are making the matter worse by further raising prices, he said.

Although the shift to ethanol and biodiesel fuels made from corn and soybeans has had an "important" effect, causing a doubling of corn and soybean prices in the U.S. and raising prices for baked goods and animal feeds, the food experts told Congress that it is not to blame for the broad increase in food prices.

However, biofuel mandates have increased the price of cereal, baked goods and vegetable oil, while ethanol-driven increases in feed prices for chickens and cows likely led to increased prices for milk and eggs, which were the fastest-rising categories of food prices last year, he said.

Shortages and record high prices for wheat and rice worldwide, Mr. Glauber said, were due more to droughts and poor crop yields in major producers, though Mr. Glauber added that he saw some relief looming in the wheat market.

The influence of ethanol production on food prices has gotten much attention from legislators, because Congress was responsible for putting in place the mandate for an increasing share of ethanol in gasoline last year and could now revisit the issue as it works on the farm bill.

An unusual alliance of liberal anti-poverty and environmental groups has joined up with food businesses and conservative free-market and taxpayer organizations to call for the repeal of the biofuel mandates.

"The humanitarian impact of the biofuels boondoggle is all the more tragic for having been so clearly foreseen," said Competitive Enterprise Institute Senior Fellow Marlo Lewis. "An array of analysts and scholars warned policy-makers against the politically expedient path of using food crops for fuel."

"Congress needs to take a closer look at the connection between bio-based fuels and rising food prices," said Gawain Kripke, policy director for the Oxfam America anti-poverty group.

Unilever makes sustainable palm oil pledge
By Paul Eccleston, Daily Telegraph
Last Updated: 6:01pm BST 01/05/2008

The Prince of Wales praised the giant Unilever group after it pledged to use only sustainably produced palm oil in its products.

Company chief executive Patrick Cescau announced the move at a conference attended by both Prince Charles and Gordon Brown. 

Illegal palm oil plantations, particularly in Indonesia, have been blamed for huge parts of the rainforests.

Prince Charles is a passionate supporter of the rainforests and set up the Rainforest Project which works with the private sector, governments and environmental experts to help stop their destruction.

After the Unilever announcement Prince Charles told his May Day Summit on Climate Change conference in London: "This really is a groundbreaking development which could make the whole difference to the future of the rainforests.

" I can only pray that other companies which use palm oil will follow your determined and principled leadership - this really is corporate responsibility in action."

Greenpeace singled out Unilever as a target for demonstrations recently because, it alleged, the company’s suppliers were destroying orang-utan habitats and clearing Indonesia’s peatland rainforests to plant palms.

Mr Cescau said his company had set a target to procure 100 per cent of its palm oil from certified sustainable sources by 2015.

"Palm oil is an important raw material for us and the whole consumer goods industry. We use a substantial amount of palm oil and we want to be an agent for positive change, as we have been in fish, tea and other areas," he told the conference.

"We started work on sustainable palm oil 10 years ago by developing and sharing our own guidelines and good practices with growers and suppliers, leading to the setting up of the Roundtable on Sustainable Palm Oil in 2004. Through the RSPO, we have continued to work hard to build an industry consensus on criteria for sustainable palm cultivation.

"Now we need to take the next step. Suppliers need to move to meet the criteria, by getting certified both the palm oil from their own plantations and the palm oil they buy from elsewhere."

He said Unilever, which produces brands such as Flora, Becel, Dove and Omo, operates in 100 countries and had sales worth £30bn last year, would support the call for an immediate moratorium on any further deforestation for palm oil in Indonesia.

Greenpeace welcomed Unilever’s call for a halt to rainforest destruction in Indonesia which it said was wiping out orang-utans and devastating the climate. The destruction of Indonesia’s peatland rainforests contributes about four per cent of global greenhouse gas emissions.

The environmental protection organisation warned that without a halt to deforestation, Unilever’s efforts to source sustainable palm oil would be doomed to fail and it called on other big corporate palm oil users and members of the RSPO to join forces with Unilever and stop ongoing forest destruction.

Rod Taylor, Director at WWF International, formerly the World Wildlife Fund, said: "We applaud Unilever’s pledge of support for efforts to halt deforestation in Indonesia and to create a palm oil supply drawn entirely from certified sustainable sources."

Earlier Prince Charles had called on Britain’s business leaders to take "essential action" to make their firms more sustainable. He urged them to seize the "economic opportunities" that come from tackling global warming.

The Prime Minister, Gordon Brown, told delegates at the conference, that combating climate change would present firms with the "opportunity to create jobs, to build business, to grow exports, to drive productivity and the opportunity to liberate the creativity and innovative strength of British companies and British people.

"Nothing less than doing this will enable us to meet the scale of the challenge the Prince of Wales has outlined."

He added that he was committed to building a "low carbon economy" both in the UK and around the world.

Now there’s ‘ocean deserts’ (not that there haven’t always been) but these are special ‘coz we can blame gorebull warming (which also covers cooling).

Oxygen-starved ocean ‘deserts’ emerging
By Roger Highfield, Science Editor
Last Updated: 8:01pm BST 01/05/2008

Underwater "deserts" are emerging in tropical oceans as the oxygen vanishes from seawater, warns a new study.

One of the consequences of a changing climate, the warmer oceans, is causing a decrease in the oxygen concentration and creating oxygen-starved, or "hypoxic" conditions underwater.

The low-oxygen zones at depths of around 500 metres near India and in the equatorial Pacific waters off the Americas have grown thicker during the past 50 years, says a report in the journal Science.

This will likely have far-reaching impacts on ecosystems because key organisms cannot survive in these zones, warn Dr Lothar Stramma of Kiel University in Germany, with colleagues at the National Oceanic and Atmospheric Administration, Seattle, Scripps Institution of Oceanography in La Jolla, and the Baltic Sea Research Institute Warnemunde in Rostock, Germany.

The team studied oxygen concentrations over half a century in waters of intermediate depth for select tropical ocean regions using historical data combined with recent measurements to find that these oxygen starved zones are expanding significantly, especially in tropical regions of the Atlantic Ocean.

"In an area to the south of the Cape Verde Islands the vertical extend of the layer with oxygen concentrations of less than 90 micromol/kg increased by 85 per cent from a thickness of 370 metres in 1960 to 690 metres in 2006."

As the low-oxygen zones in the tropical oceans at 300 to 700 metres have extended, the habitable regions for open ocean fish, plankton and other organisms has decreased. This has "fundamental implications for marine ecosystems and thereby fisheries resource management issues," he says.

"While changes in fish stock might be in interesting, I expect a larger signal from changing biogeochemisty conditions in that more suboxic (low oxygen) zones lead to more denitrification, hence to less available nutrients and less biological productivity. However a process we are just beginning to understand."

He said it is not easy to predict future trends. "As we observed the changes, but cannot clearly reveal the causes from observations alone, it is only speculation that the widening of the low oxygen zones will continue in the future," says Dr Stramma.

But he adds that "it might be reasonable to believe that the oxygen-minimum zones will expand in the future, however more modelling and observational efforts will be necessary to derive better predictions for the future."

Imagine that… ’save the planet’ from what, we wonder? And apparently so do Britons since they are none too impressed with their government ripping them off with taxes in the name of planetary salvation.

Green tax revolt: Britons ‘will not foot bill to save planet’
Majority of Britons are opposed to increases in green taxation

By Colin Brown, Deputy Political Editor, The Independent
Friday, 2 May 2008

More than seven in 10 voters insist that they would not be willing to pay higher taxes in order to fund projects to combat climate change, according to a new poll.

The survey also reveals that most Britons believe "green" taxes on 4×4s, plastic bags and other consumer goods have been imposed to raise cash rather than change our behaviour, while two-thirds of Britons think the entire green agenda has been hijacked as a ploy to increase taxes.

The findings make depressing reading for green campaigners, who have spent recent months urging the Government to take far more radical action to reduce Britain’s carbon footprint. The UK is committed to reducing carbon emissions by 60 per cent by 2050, a target that most experts believe will be difficult to reach. The results of the poll by Opinium, a leading research company, indicate that maintaining popular support for green policies may be a difficult act to pull off, and attempts in the future to curb car use and publicly fund investment in renewable resources will prove deeply unpopular.

The implications of the poll could also blow a hole in the calculations of the Chancellor, Alistair Darling, who was forced to delay a scheduled 2p-a-litre rise in fuel duty until the autumn in his spring Budget, while his plans to impose a showroom tax and higher vehicle excise duty on gas-guzzling cars will not take effect for a year. He is now under pressure to shelve the increase in fuel duty because of the steep rise in the price of oil.

The public’s climate-change scepticism extends to the recent floods which inundated much of the West Country, and reported signs of changes in the cycle of the seasons. Just over a third of respondents (34 per cent) believe that extreme weather is becoming more common but has nothing to do with global warming. One in 10 said that they believed that climate change is totally natural.

The over-55s are most cynical about the effects of global warming with 43 per cent believing that extreme weather and global warming are unconnected.

Three in 10 (29 per cent) of all respondents would oppose any more legislation in support of green policies, while close to a third of citizens (31 per cent) believe that green taxes will have no discernible effect on the environment since people will still take long-haul flights regularly and drive carbon-heavy vehicles.

Mike Childs, the head of campaigns for Friends of the Earth, blamed the Government for generating a cynical response to "green taxes". "People do get cynical unless they see benefits," he said. "The Government is playing a dangerous game. They are using climate change to identify potential new taxes and revenues but the public aren’t seeing anything in return. The public aren’t being helped to go green. The Government could put a windfall tax on the big oil companies and use that money to insulate homes or introduce a feed-in tariff to pay people to produce renewable energy."

Mark Hodson, of Opinium Research, said: "Britain appears to be feeling increasingly negative about being more carbon neutral. We are questioning the truth behind being greener and many feel that Government is creating a green fear for monetary gain."

The findings were released as the Prince of Wales yesterday called on Britain’s business leaders to take "essential action" to make their firms more sustainable. Speaking in central London to some of the country’s leading chief executives, Prince Charles said: "What more can I do but urge you, this country’s business leaders, to take the essential action now to make your businesses more sustainable. I’m exhausted with repeating that there really is no time to lose."

Also attending the May Day Business Summit, the Prime Minister promised the Government will set out a "credible" long-term policy framework to help industry develop innovative low-carbon, resource-efficient products and services.

He outlined the recommendations of a report, Building a Low Carbon Economy, for creating a "green" economy, including "seeking to encourage changes in consumer behaviour".

Gordon Brown said: "We know that we will only succeed if individuals and communities, as well as Government and business, are part of the solution."

Hilary Benn, the Environment Secretary, said: "The Government is committed to building a low-carbon economy, here and around the world. That means a complete change in the way we live and an economic transformation that will put Britain at the forefront of a technological revolution in the way we use and source our energy."

The research was conducted online amongst 2,002 adults by Opinium Research LLP between 11 and 14 April

Profits Of Doom?

By INVESTOR’S BUSINESS DAILY | Posted Thursday, May 01, 2008 4:20 PM PT

Profits: Exxon Mobil’s first-quarter earnings of $10.9 billion, up 17% from a year earlier, are stirring outrage in Washington. Some are calling such profits "obscene." What a sad lack of understanding of economics.

Case in point: Presidential candidate Hillary Clinton. Like her rival, Barack Obama, she’s pushing a massive "windfall profit" tax on those "greedy" oil companies. "There is something seriously wrong with our economy when Exxon’s record $11 billion in quarterly profits are seen as a disappointment by Wall Street," Clinton said Thursday. "This is truly Dick Cheney’s wonderland."

No, what’s seriously wrong is that politicians such as Clinton can cynically manipulate public opinion to enact disastrous policies.

Indeed, rather than be upset at Exxon’s profits, Americans should be thrilled — and angry at a Congress that doesn’t seem to want to encourage the oil industry to make even more.

Our free-market economy is built on profit. Higher profits mean more jobs, higher incomes, more investment in equipment and people, higher standards of living. Yes, profits are the engine for all of this — and that includes the profits of "Big Oil."

By signaling that supply is scarce, higher profits encourage more production. Except, that is, when Congress through its inept lawmaking stands in the way. And that’s the case now with the oil industry.

Congress seems almost constantly at war with the oil companies — slapping them with taxes and pillorying their CEOs while ignoring the fact that higher profits lead to more exploration, drilling and development.

If anyone is to blame for our current energy mess, it’s Congress. At least 20 billion barrels of oil sit untapped in Alaska and another 30 billion lie offshore. Such sources that could help satisfy U.S. demand for years to come. Yet, Congress has put them out of bounds.

Instead, Congress scapegoats oil profits. In reality, according to Ernst & Young, from 1992 to 2006 the U.S. oil industry spent $1.25 trillion on long-term investment vs. profits of $900 billion.

Truth is, oil industry profits are in line with the rest of American industry. In 2007, a record year, they earned 8.3 cents per dollar of sales. Beverage companies and cigarette makers, by contrast, earned 19.1 cents. Drug makers, 18.4 cents. Indeed, all manufacturers, 8.9 cents on average, made more than "Big Oil."

Besides, we’ve tried windfall profits taxes before, in the early 1980s, and they were an utter failure. As the Congressional Research Service found, revenues produced for the government were nearly 75% below what was expected. Meanwhile, domestic oil output fell 8%, while oil imports surged 16%.

That’s just poor policy, and even worse economics.

Remember: Oil companies don’t really pay "windfall profit" taxes, anyway. You do. Some 50 million Americans today own oil company stock, either directly or through 401(k)s and mutual funds. Don’t be suckered: "Windfall profits" taxes come right out of your retirement account, not out of the oil industry’s business.

Oh sure, Big Oil’s profits are up. But so are the taxes they pay. In 2006, that came to $90 billion — up 334% in just four years.

This is how Clinton-style populism works. It starts with ignorance and ends with serious damage to our economy.

Oil prices aren’t high because profits are up; they’re high because we don’t have enough oil. By clamping down on drilling, refusing to move forward on nuclear energy and hitting producers with punitive taxes, Congress is doing all it can to ensure we don’t have enough in the future.

Here’s another "Oh, really?" Over what period have said storms allegedly increased? Is it merely the up-swing portion of normal cyclical hurricane activity? As yet there is no indication there’s any real increase in storm activity over the long term so how did these corals survive previous storm[ier] periods?

Increasingly intense storms threaten coral
UPI

A British scientist suggests hurricanes and other storms are increasing in intensity and are limiting the growth of some corals.

The Earthwatch Institute-supported study focused on the ability of corals in Belize to "recruit" new coral into their communities.

"Increasing evidence now shows that storms are becoming more intense due to climate change," said lead author and Earthwatch scientist James Crabbe from the University of Bedfordshire.

Coral reefs, which can expand for thousands of years, form when free-swimming coral larvae in the ocean attach to rocks or other hard surfaces and begin to develop.

"If the storms don’t destroy corals outright, they render them more susceptible to disease," said Crabbe, "and that is certainly apparent on the Belize reefs."

He said his findings have implications for marine park managers. "They may need to assist coral recruitment and settlement (during hurricane years) by establishing coral nurseries and then placing the baby corals (larvae) in the reef at discrete locations" or by setting up artificial reef blocks to help the corals survive.

The research that included Edwin Martinez, Earthwatch field director in Belize, appears in the May issue of the journal Marine Environmental Research.

Just don’t do it.

Dollars in Details: Climate Bill Boon To Some Utilities, Bust To Others

Keith Johnson, WSJ

The climate-change bills Congress is mulling will create winners and losers—in the utility business and in industry. Who and how much they win depends on how the game is played.

We’ve noted before that the devil is in the details when it comes to legislating caps on greenhouse-gas emissions. But for the electric power companies under target—which would shoulder 80% to 90% of the burden of cuts in the popular Lieberman-Warner bill—those details are potentially worth hundreds of millions of dollars a year.

A new study released today by Ceres, a shareholder coalition pushing companies to curb their global-warming emissions, and the National Resources Defense Council, an environmental group that wants the same thing, breaks down the impact of two leading bills on the U.S. power sector, which accounts for 40% of the country’s emissions of carbon dioxide.

The two climate bills—Lieberman-Warner and Bingaman-Specter—would initially give away most of the permits to emit CO2, selling about one-quarter. Later in the process, both bills would sell more than half the new permits issued. Utilities like the idea of freebies, while economists argue that selling the permits makes more sense.

But one crucial question is how to divvy up the permits. Both bills currently propose doling out emissions permits based on how much carbon dioxide each company has emitted in the past. That means utilities that burn a lot of coal, and have a lot of emissions, would get more permits than, say, nuclear power utilities.

The differences can be huge: According to the report, a company with lots of nuclear assets like Exelon would receive about $51 million worth of emissions permits in 2012 (the report assumes for argument’s sake that a permit to emit one ton of carbon dioxide costs $10). A coal-heavy utility like Southern Company would get $734 million worth of permits under Lieberman-Warner.

But what if the allowances were doled out based on the share of electricity each company produced? The idea is to avoid penalizing utilities that haven’t been dirty in the past. That would change the situation dramatically. Exelon would get almost as many permits as Southern—or $454 million. Southern’s share would fall, to $600 million.

The political battle over who shoulders the biggest burden in fighting climate change is just starting, but with industry groups increasingly resigned to the passage of some sort of climate bill in the near future, expect the emphasis to shift from fighting federal action to trying to game the fine print.

In fact, it already has: Pacific Gas & Electric, one of the utilities that commissioned the study, would see a nearly 50-fold increase in permit allocations if what counts is how much electricity is produced, rather than how dirty the utility was in the past.

Shell Game: Oil Giant Pulls out of U.K. Wind Farm

Keith Johnson, WSJ

We’ve mentioned before the belief that high oil prices will inevitably spur more alternative energy. But as always—be careful what you wish for. Sometimes high oil prices make other things more attractive—like more oil.

Royal Dutch Shell said it is pulling out of the “London Array,” which—if it ever gets built—will be one of the world’s largest wind farms. Shell says it will put its one-third stake in the $4 billion project up for sale, part of its regular review of investments. Shell’s departure leaves the other two partners, Germany’s E.On and Denmark’s DONG, holding the bag on an increasingly expensive and complex project.

Shell says its withdrawal isn’t an indictment of clean energy, and points to its on-going investment in wind energy in the U.S. But British newspapers take a more skeptical line. The Times of London called the departure a “huge blow” to Britain’s ambitious plans to harness offshore wind to meet growing energy needs. The Guardian is harsher:

[E]nvironmentalists will see the decision to drop one of only two renewable schemes being worked on by Shell in Britain as a further sign that the company is retreating back to hydrocarbons at a time when the price of oil has risen to about $120 a barrel. Shell, which earlier this week reported first quarter profits of £4bn, has been selling off much of its solar business while moving more into Canada’s carbon-heavy tar sands.

Actually, Shell’s departure raises the question—is it pulling out renewables in favor of good, old, pricey oil? Or is it just pulling out of the dysfunctional renewable-energy market in the U.K.?

Britain has ambitious plans for clean energy, and theoretically plenty of renewable-energy resources, but has made little progress so far. Last week, a signature wind farm in Scotland was scuppered over environmental concerns. Other offshore wind farm projects have languished for years on technical and cost concerns.

Britain’s lag in clean-energy development—it has less wind power than the state of California or Texas—contrasts sharply with government goals, and has led to plenty of soul-searching. The Labor government wants 30,000 megawatts of offshore wind power built in the next two decades; today, Britain has 400 megawatts installed.

The U.S., by contrast, has been the fastest-growing wind-power market in the world for two years running. That’s the case, by the way, even though the U.S. famously never ratified the Kyoto Protocol. The real-world result: Even though it isn’t clear if or when U.S. federal clean-energy subsidies will be renewed, European utilities are champing at the bit to enter the U.S. wind market.

Chevron’s O’Reilly: Global Oil Demand is the Culprit

Keith Johnson, WSJ

Chevron boss David O’Reilly has reached a sobering conclusion: The days of cheap oil really are over.

Mr. O’Reilly is hardly a peak-oil proponent, even as some of his Big Oil colleagues have made peakish noises. In an interview with the WSJ (sub reqd.), Mr. O’Reilly, who’s seen crude prices increase five-fold on his watch, said oil won’t return to the halcyon days of the 1990s. That’s not because of a lack of supply—in contrast to other O’Reilly theories on oil—but rather because of relentless global demand growth.

Three years ago, Mr. O’Reilly made waves by warning cheap oil was a memory, but it went on to more than double in price since then. The WSJ asked him to peer into the crystal ball again:

Mr. O’Reilly: I can’t predict what the price is going to be. You would have to tell me what the economic situation in the world is going to be a year from now. I don’t think it is going to get back to those relatively low levels we experienced in the late ’90s and early 2000s.
WSJ: Ever?
Mr. O’Reilly: No.

But what are the implications of higher oil prices—beyond bigger profits for oil companies?

In the U.S., Mr. O’Reilly says there are already signs of changing behavior, with people trading gas-guzzling cars for smaller models and using less fuel. He’s even changed cars himself, though he admits “I’m not driving in a Prius, if that’s what you’re asking.”

But that alone won’t do much to alter the global oil dynamics. More people driving in more countries cancels out small efficiency gains elsewhere. Developing countries’ thirst for oil in particular knows no bounds, he said:

I was in Turkey a couple of months ago. The price of gasoline is almost $11 a gallon. They’re selling a record number of automobiles. Traffic is backed up all over Istanbul.

Theoretically, he said in the audio portion of the interview, higher oil prices should “attract alternative energy,” such as the “tremendous effort going into wind [power] in this country.” Even though Chevron doesn’t stand to make any money off wind power, that’s still “a healthy thing,” Mr. O’Reilly said, because the world needs both fossil fuels and alternative energy to keep working.

But that’s the big question—do higher oil prices really drive more alternative energy? Not always, it seems. Stay tuned.

Green Ink: The Cool Decade

Keith Johnson, WSJ

The Fed’s hint at a pause in further rate cuts helped the dollar, and hurt crude prices—for a while, reports the WSJ (sub reqd.) But uncertainty over future cuts left crude trading above $114 in overnight trades. The perspective of an end to Nigerian strikes, stronger U.S. inventories, and a dollar recovery are keeping crude in check Thursday, Bloomberg reports.

But that doesn’t mean the great gas tax debate is finished. The NYT ed page calls the gas-tax holiday unsound both economically and environmentally—higher energy prices are what’s needed to trim consumption. Grist, meanwhile, takes humorous aim at the nefarious Gas Price Surrender plan by Sen. Obama.

Global temperatures will cool slightly through 2015, part of a natural change in the mid-Atlantic currents, according to a new paper in Nature. The NYT explores how climate modelers are tweaking how they predict future temperature changes, and the Guardian points out that the short-term cooling doesn’t mean global warming isn’t happening.

It hasn’t stopped British climate guru Sir Nicholas Stern, who released another global warming report, calling for steeper cuts to avoid catastrophic damage. But now, the developing world has to pull its weight, too, reports Bloomberg. One way to do that is to make forests more valuable, argues Nicholas Kristof in the NYT. Deforestation accounts for more emissions than the entire history of aviation. But rich countries can’t shirk their duty, either. The New Statesman examines why Germany has 200 times more solar power than Britain (neither place is sunny) and concludes that “political will is a renewable resource.”

What is sunny is the Sahara, and Europe hopes the Desertec solar project will be a win-win for rich countries and north Africa alike, reports Spiegel. The idea of big solar is catching on: First Solar will get into utility-size solar as electricity costs from solar power steadily fall, in the Arizona Republic. They make fall even quicker: The MIT Technology review expects the end of the silicon shortage to bring solar power to “grid parity” by 2010.

That should make renewables a bigger part of the energy mix, especially in the U.S. General Electric tells Reuters that it expects renewable energy to increase four-fold by 2010, especially wind power. The money will be there: venture capital giants Kleiner Perkins Caufield & Byers launch a new fund today to target bigger firms launching green ventures, reports the WSJ (sub reqd.). Finally, Philly gets its own green venture. The Phillies have become one of the greenest teams in MLB after buying offsets for all their energy use, and even wear green caps, in the Philadelphia Inquirer.

US emitters must pay for permits: Study

Carbon Positive
2 May 2008

The leading climate bills being proposed in the Congress to cap and trade greenhouse gas emissions in the United States risk repeating the mistakes of the EU Emissions Trading Scheme (EU ETS), a study of the legislation warns. The Benchmarking Air Emissions report by the Ceres investor coalition, Natural Resources Defense Council and power companies PG&E and PSEG recommends that future regulation of power industry emissions should make generators pay for permits.

The report also found that carbon dioxide (CO2) emissions from US power generation in 2006 were 29 per cent higher than they were in 1990. By contrast, emissions of sulphur dioxide (SO2) and nitrogen oxide (NOx) emissions, subject to emissions caps and trading regulations over that time, dropped by 40 per cent and 46 per cent, respectively.

The analysis carried out by an alliance of environmental and energy interests looked at the emissions of the 100 biggest power companies in the US and legislation proposed to regulate them. It found the Lieberman-Warner and Bingaman-Specter Senate bills would lead to the giving away of billions of dollars of free emission permits to power companies when they should be making them pay for most or all at auction.

The Lieberman-Warner bill proposes to give away permits covering 45 per cent of US power emissions, while the Bingaman-Specter Bill would give away about 80 per cent. If a price of $10 a ton of CO2 were assumed, this values the giveaways at $10 billion and $18 billion respectively. Lieberman-Warner would likely lead to greater consumer protection and benefit than its rival because of the lower proportion of free permits handed out, the report says.

The EU ETS, which began in 2005, has given away most permits (EUAs) to power companies for free in order to limit the economic costs to emitting industries and limit price rises for consumers. But the results have been quite different. EU power companies have passed on the full market value of their permits to customers in higher prices anyway, despite not having had to pay for them at all.

The EU experience has led many of those involved in emissions trading design and regulation around the world to conclude that the best way to protect consumers from the impacts of carbon pricing is to auction emission permits and then compensate the vulnerable – such as low-income households - with the proceeds. Funds from auctions can also be directed to subsidising investments in clean technology.

"Research indicates that an over-allocation of free allowances to electricity generators can lead to excessive profits for companies, while providing limited benefits in terms of reducing electricity price impacts for consumers and funding energy efficiency and other programs that reduce overall greenhouse gas emissions," the report states.

It recommends a combination of rebates and energy-efficiency incentives for consumers through local retail power suppliers. It finds that under such a system an average family could have their entire increase in power costs offset.

Download:
Benchmarking Air Emissions [PDF 92 pgs]