Next to Nothing for Climate in Obama Plan

The Environmental Protection Agency will unveil a draft proposal on Monday to cut carbon pollution from the nation’s power plants 30 percent from 2005 levels by 2030, according to people briefed on the plan. The proposed rule amounts to one of the strongest actions ever taken by the United States government to fight climate change. (emphasis added)

That’s this morning’s breaking news on President Obama’s climate action plan, from NY Times national energy-climate correspondent Coral Davenport. Yet peel back the numbers and the plan turns out to be precious little.

Relative to 2030 emissions projected from current trends, the drop in that year’s U.S. CO2 emissions sought by the President is a painfully modest 355 million tonnes (metric tons). That equates to just 7% of total actual emissions from all sources last year (5313 million tonnes).

White House’s 2030 CO2 Reduction Target: Just 7 Percent.

To be sure, the business-as-usual (no action) trajectory producing that 355 million tonne figure is mine, not the administration’s. (At the time I wrote this the White House hadn’t translated its percentage target into metric tons of CO2.) I derive it below, and it’s subject to argument. What’s not debatable is that power plants are the low-hanging fruit in cutting CO2. That’s because electricity-sector emissions can be cut relatively easily not just via the demand side (through energy efficiency and conservation) but also on the supply side (by converting from coal to gas, and from coal and gas to renewables). Indeed, as of last year, demand and supply steps by industry, household and government had already wrought a 15% reduction in U.S. power plant emissions from the president’s 2005 base year (a drop of 361 million tonnes from 2414 million). By calling for only a second round of 15% cuts (355 million tonnes) from 2014 to 2030, the Obama plan in effect takes twice as long (16 years) to cut as much carbon pollution as the country just did (in 8 years, from 2005 to 2013).

Here’s another way to see how undersized a CO2 cut 355 million tonnes is: in a different political universe, one in which a carbon tax could be made the economic engine for cutting CO2, that same reduction (355 million tonnes) could be effectuated through almost the tiniest carbon tax imaginable: a carbon pollution fee starting at $2.15 per ton of CO2 and rising by $2.15/ton each year, and applied only to the electricity sector (i.e., ignoring the other 61% of U.S. CO2 that comes from cars, trucks, planes, refineries, factories, heating, mining, etc., as the Obama plan does). Equivalently, an economy-wide carbon tax of just a buck and a quarter per ton of CO2 (rising by the same $1.25 each year) would also do the CO2-cutting job of the Obama plan. (These tax rates are derivable with my newly updated carbon tax spreadsheet model, which you can download here.)

So when the NY Times calls the Obama plan one of the strongest U.S. government actions ever taken on climate, that’s a sign of how low the bar has been set by our country’s history of inaction.

What to do? Two things.

First, lean on the environmental lobby to stop caving to the White House. We need prominent advocates like NRDC and EDF to insist on more. Yes, it can be difficult to talk tough to the President when even halting steps like today’s are viciously attacked by the dirty-energy lobby. But heaping praise on a policy to cut emissions just 7% over 16 years doesn’t square with treating global warming like the planetary emergency it is.

Second, get behind a carbon tax — a real one, like the $12.50/tonneCO2 tax (starting at that rate and rising annually at the same rate) that Rep. Jim McDermott (D-WA) is readying for introduction this week. Our modeling indicates that in its tenth year, the McDermott carbon tax (which equates to $11.34 per conventional “short” ton of CO2), would reduce U.S. CO2 emissions by a third from 2005 levels, and by nearly 30% from future emissions without the tax. (By 2030, the reductions would be 41% from 2005 and 37% from business-as-usual.) The local chapter of the Citizens Climate Lobby is an excellent vehicle for political action for this or other robust carbon taxes.

Like you, we know full well that a measure like McDermott’s can’t and won’t make it through this Congress, and perhaps the next, even though it could be folded into comprehensive tax reform, spurring economic growth by shifting tax burdens off work and investment and onto climate pollution. But seven percent won’t do. A robust carbon tax like McDermott’s is more essential than ever.

Electricity-sector CO2 emissions in 2030 under “business-as-usual”: These depend on two parameters — electricity sales (which determine) generation; and the CO2 “content” of an average kWh generated. I estimated future electricity sales using AEO (that’s the US Energy Information Administration’s Annual Energy Outlook) forecasts of GDP growth and electricity rates, which I processed through assumed elasticities of 0.5 for income and (negative) 0.7 for price. For CO2 content, I assumed an annual decline in CO2/kWh of 1.0%, which is half of the average 2.0% “decarbonization” rate experienced in 2005-2013. As noted or implied above, U.S. electricity-sector emissions were 2414 million tonnes of CO2 in 2005 and 2053 million in 2013. A 30% cut in the former figure (the President’s goal) is 724 million tonnes, implying a 2030 target of 2414 less 724, or 1690 million tonnes. My modeling implies business-as-usual year-2030 emissions of 2045 million tonnes (coincidentally, almost identical to actual 2013 emissions). Reducing that to 1690 million tonnes requires a relative cut of 355 million tonnes, which is just 6.7% of actual year-2013 total U.S. emissions of 5313 million tonnes. For sources, more details and all calculations, see the Electricity “tab” of my carbon tax spreadsheet model.

Comments

  1. JK says

    This seems like the big headline:

    Obama Calls for Slow Down in Carbon Cuts from Power Plants

    “By calling for only a second round of 15% cuts (355 million tonnes) from 2014 to 2030, the Obama plan in effect takes twice as long (16 years) to cut as much carbon pollution as the country just did (in 8 years, from 2005 to 2013)”

  2. jan freed says

    The bottom line IMO is …when the Other Big Boys that are smacked upside the head by AGW wake up, they just might lobby for a new crew in Congress. So, insurance companies, Cargill, General Foods, cattlemen, farmers etc. may be able to counterbalance the millions invested in politics by Big Carbon.

    “Carbon fee and dividend” is well within the ideological wheelhouse of the GOP, so, what are they waiting for, if not for campaign contributions?

  3. says

    “the president’s 2005 base year” is misleading. The crash of 2007 left that as the highest electric demand year, since then, it’s been down, down, down, decreased coal burning, and so carbon emissions have dramatically reduced since that time because of the recession. The base year should be 2008 or 2009 and we start looking at reductions from there.

  4. David F Collins says

    Thanks to Charles Komanoff and CTC for pointing out that today’s Carbon Pollution plan amounts to precious little. You could say that the Emperor’s New Clothing is a thong-panty. So thanks for calling a spade not a spade but a little tyke’s beach shovel.

    The one bright side of this thong of a plan is the howls, yowls and bleated blather it elicits from the Facile Fools’ lobbies and running dogs’ associations.

  5. says

    Thanks for adding valuable details to this policy proposal! We definitely want to do more than 15% over 8 yrs, and in just one sector of the economy. (Fortunately, the Administration’s rising CAFE standards are also helping.) $1.25/ton is negligible, even if it rises $1.25/ton per year.
    But readers wonder: will the administrative costs of applying (& enforcing) a carbon tax across multiple sectors (of, say, $5 to $15 per ton) be a lot higher than those for the EPA’s policy proposal? And what share of our GHG emissions will it probably not target, due to admin burdens? Perhaps it’s much easier to regulate power plants this way, than apply a carbon tax (which is much more equitable, but not always simple to apply).
    I also wonder why only 1000 plants are targeted in the US (under this policy), and just half of those are coal-fired, according to news programs. Please do keep generating great information to keep us on the straight & narrow!

  6. says

    Thanks for your commentary Charlie. As usual, a much needed counterpoint to the cheerleading on these too-weak policies. One thing–I wonder if it is fair to compare the power plant emissions to the total economy emissions, because this does not count the reductions that will be made through 2030 due to another Obama Administration policy– vehicle emissions standards. I think that the policy is too weak no matter how you cut it, but that the impact of quoting the number for the whole economy is stronger when the whole-economy policies are counted.

  7. Robert says

    Thanks for the clear analysis, Charles. You folks really shine a spotlight on the token nature of proposed reductions compared to those of recent years showing that the Obama climate plan would actually slow reductions of emissions in the next 16 years.

    My only question about your analysis is the phrase with ** around it below:

    What’s not debatable is that power plants are the low-hanging fruit in cutting CO2. That’s because electricity-sector emissions can be cut relatively easily not just via the demand side (through energy efficiency and conservation) but also on the supply side (*by converting from coal to gas*, and from coal and gas to renewables).

    Is the work of Howarth not convincing that coal to gas conversion is not a real source reduction given time frames within which action is necessary?

    Presentation from January 2014: “Natural Gas, Methane, and Global Warming”. Given to the Global Advisory Group of Trade Unions for Energy Democracy.

    Video from 30 Nov 2013: Presentation titled “Natural Gas, Methane, and Global Warming” given at the Duquesne University symposium on shale gas extraction research.
    and the older stuff:

    Howarth et al, 2012 response to Cathles etc.

    Thanks a lot for useful work, Charles. I hope folks will turn up the heat on the Sierra Club and MoveOn who have faithfully followed upon Obama’s “climate plan” with support for it. They (along with NRDC) need to hear from all of us!

  8. says

    @13. Robert. Ezxactly! That’s the big canard in all of this. Not only the work of Howarth et al but a major study of direct measurement from gas fields and control areas by a team communing resources of Harvard, Berkley, NOAA, NASA and other climate research institutions has shown that the EPA is way out on reducing estimate for fugitive emissions and it should in fact have doubled the estimate not halved it.

    Also not that according to new research in Australia our national GHG auditing hides land use sector emissions greatly. Using GWP20 — and 20 years is a significant time frame given the proximity of climatic tipping points — the land use sector contributes 55% of national emissions (not the 6% using GWP₁₀₀ I heard Monash University Chancellor claim!) and 90% of those are associated with livestock. So land use patterns associated with livestock like enteric fermentation, land clearing and savanna burning account for 50% of my countries emissions (using GWP₂₀).

  9. Lee Diamond says

    Carbon Tax is clearly the way to go. Of course, it is equally clear that the President of the United States lacks the power to impose a Carbon Tax on the country. Why don’t people stop the pointless blathering?

    Without help from Congress, the administration is relying on a 40 FORTY + year old statute.

    WE as in the US………yes US>…….YOU, ME and everyone ELSE we can grab must DO THE WORK to make this happen. Get people to vote and lobby federal and state legislators. Build our movement.

  10. says

    Thank you, Charles and the Carbon Tax Center, for providing this fact-based perspective. Many people are already thinking that, with this regulatory initiative, the U.S. has done its share. The truth is that this can only be the beginning. The world must focus on mitigation. For a glimpse into the cost and contentiousness of ADAPTATION, read the Washington Post’s May 31 article, “In Norfolk, evidence of climate change is in the streets at high tide.”

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Last modified: June 8, 2014