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Tilting at Windmills

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November 5, 2007
By: Kevin Drum

HILLARY'S ENERGY PLAN....I see that Hillary Clinton has finally released her long awaited climate and energy plan. Dave Roberts says: "It is thoughtful, comprehensive, and though disappointingly conventional in a few areas, inspiringly bold in others....I give the plan an A overall."

The question uppermost on my mind was whether HRC would support either a carbon tax or a cap-and-trade plan, since this is frankly the only part of the standard liberal agenda on energy that's really very risky to endorse. I'm told that both are essentially the same thing in practice, so it's no surprise that the leading candidates, now including Hillary, have all chosen the cap-and-trade route, which raises energy prices but doesn't include the dread word "taxes." The upside of this, I think, is that a properly designed cap-and-trade plan actually ought to be better than a carbon tax. The downside is that one has to trust that the plan will be properly designed, which is sort of a sucker bet, isn't it?

Anyway, Dave has the details in condensed, reader-friendly format over at Grist. The next step is for someone to compare the plans from the three leading Dems to see if there are really any significant differences in their approaches. My first pass suggests some modest differences in emphasis, but that's about it. More later as I dive into the details.

Kevin Drum 3:21 PM Permalink | Trackbacks | Comments (37)

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It would be interesting to know how much of this is "inspired" by Rep. Inslee's energy program, which is sort of working its way through Congress, as Inslee is heading up Washington State for Clinton.

http://www.govtrack.us/congress/bill.xpd?bill=h109-2828


My hope was that he'd run for the senate seat Murray is (hopefully) vacating in 2008. However, at his point in his political life, signing on to push Clinton in his home state is the kind of job that you take if you want a cabinet appointment.

Posted by: JeffII on November 5, 2007 at 3:41 PM | PERMALINK

If (dirty) energy cost more, people would use it less.

I guess that's just too controversial for people to grasp.

Posted by: craigie on November 5, 2007 at 3:53 PM | PERMALINK

Some proposed cap-and-trade plans represent huge handouts to big polluters: they get to pollute as much as they currently do (or even more) for free, plus the right to sell those rights off for whatever the market will bear. So it's like a carbon tax, except that the biggest polluters don't pay at first, and later on we all pay them.

Posted by: Joe Buck on November 5, 2007 at 4:04 PM | PERMALINK

I glanced at Hillary Clinton's energy proposal. Anyone who knows the enormous numbers involved in providing bulk load electrical power to an industrial economy would have trouble believing that "alternate schemes" ----which mainly means solar and wind---can ever amount to more than a few % of the total. Sure, we should do them ---even knowing full well that they will require enduring subsidies---but to rely on them is not wise. Energy efficiency is potentially more important---and will likely attract more and more private investment because of market signals. But additionally large scale bulk generation will have to come from either coal (boo) or nuclear (fission near term, fusion eventually)----it is just a matter of power density. No one seriously arguing the contrary can win a serious energy debate in the Democratic party, the GOP, or society at large. And I am thus sad to see the Clinton campaign so far seems to be unaware of this.

Posted by: Jeffrey Harris on November 5, 2007 at 4:18 PM | PERMALINK

While it's true that current solar and wind generation technology can't provide enough energy for larger factories or office towers, it's fucking criminal that any place in the U.S. that gets 200+ days a year of sunshine isn't being at least partially powered by solar. In particular, the Sun Belt and Mountain West states should be requiring solar panels for all new residential and commercial construction, and the federal and state governments should be subsidizing retrofits for anyone who wants one. Why not? We did it for thermally improved windows, exterior doors and, insulation.

Oh. I forgot. The U.S. is bankrupt because of a pointless war attempting to secure the energy source of the last century, and so no longer do we have the fiscal flexibility to undertake such measures.

May everyone in the Bush administration die long pain deaths.

Posted by: JeffII on November 5, 2007 at 4:30 PM | PERMALINK

If I may plagiarize Atrios, the choice is not between the candidate plans and your ideal 'pony' plan; it's between no plan and the likely plan that will emerge from the Great Washington Sausage Grinder.

Number one ingredient: The Healthcare lobby.

Posted by: anonymous on November 5, 2007 at 4:45 PM | PERMALINK

Jeffrey Harris wrote: "Anyone who knows the enormous numbers involved in providing bulk load electrical power to an industrial economy would have trouble believing that 'alternate schemes' ----which mainly means solar and wind---can ever amount to more than a few % of the total."

Anyone who has actually looked at the numerous studies of electrical generation potential from solar and wind in the USA knows that your assertion is just plain wrong.

For just one example, in January 2007, the American Solar Energy Society published a report entitled "Tackling Climate Change in the US: Potential Carbon Emissions Reductions from Energy Efficiency and Renewable Energy by 2030".

The ASES report concluded that full application of existing energy efficiency and renewable energy technologies (wind power, biofuels, biomass, photovoltaics, concentrating solar power, and geothermal power) could reduce US carbon emissions by 60 to 80 percent by mid-century, which is in line with what mainstream climate science indicates will be needed to keep CO2 levels below 450 ppm, which is generally considered to be the level below which we can prevent “dangerous” climate change.

The report concluded that full application of existing energy efficiency technologies alone would “prevent our carbon emissions from growing over the next 23 years, even as our economy grows”; 57 percent of total reductions would come from energy efficiency improvements and 43 percent from expanded use of the six renewable technologies examined.

You may have "trouble believing" this since it conflicts with your existing beliefs. I suggest that you download the free PDF version of the ASES report, available at the above-linked site, and read it carefully before concluding that "it must be wrong".

Posted by: SecularAnimist on November 5, 2007 at 4:47 PM | PERMALINK

Goddamn it... wrong thread

Posted by: anonymous on November 5, 2007 at 4:48 PM | PERMALINK

How can a cap and trade be better than a carbon tax?

A cap and trade rewards current polluters.

A cap and trade rewards companies like Enron who will make the market.

A cap and trade creates a new bureaucracy to determine the proper way to allocate the newly valuable credits.

A tax raises revenue and we can use it to cut other taxes

Posted by: neil wilson on November 5, 2007 at 4:48 PM | PERMALINK

Isn't a cap-and-trade scheme going to far easier for industry lobbyists to dilute until it's completely toothless?

Posted by: Tim(uk) on November 5, 2007 at 5:01 PM | PERMALINK
A cap and trade rewards current polluters.

It doesn't have to; you don't have to set caps for individual entities based on their existing output. Actually, the best "cap and trade" system (for controlling any kind of pollution; the structure can be the same regardless of the particular subject) would probably involve taking the current US aggregate level of whatever is being controlled, set aggregate targets into the future, and then apportion a cap to each person (or perhaps "adult citizen") so that the total output equals the aggregate target for the year. That's the cap part. Then you allow the usage credits to be traded in the market.

Posted by: cmdicely on November 5, 2007 at 5:14 PM | PERMALINK

*

Posted by: mhr on November 5, 2007 at 5:53 PM | PERMALINK

Kevin:
Cap and trade is not at all like a carbon tax. First, cap and trade will not impact 40 percent of the source of CO2 emissions -- transportation, i.e., the sacred automobile. Second, cap and trade is complex, a carbon tax is direct and less costly to implement. Third, as already noted by others, cap and trade allows gaming of the system by some of the worst polluters.

Cap and trade advocates assert that cap and trade provides some certainty for emission reductions because of the cap, while we can't predict how behavior will change with a tax. Nonsense! The reason, as you did correctly note, is that Democrats think anything with the word tax is political death, so they run from it like the plague.

Also, those who promote cap and trade like to point to the success of the cap and trade system in combatting acid rain in the early 1990s. The difference is that NOX and SOX emissions come from a relatively small number of polluters (coal plants) and the technology to reduce NOX and SOX was known and relatively affordable. CO2 emitters are in the millions -- since autos are a key source of CO2 -- and the technologies to reduce CO2 (beyond simple conservation thru less energy use) are expensive. Cap and trade is going to be a disappointing and time-consuming distraction from the task of reducing CO2.

Posted by: Scott Farris on November 5, 2007 at 5:55 PM | PERMALINK

I take it that the lady is against drilling in Anwar and off-shore and against nuclear power, as well and against wind power that spoils Ted Kennedy's view. Posted by: mhr

Jeez, mhr. Is this the best you can do? If you're going to just phone it in, you won't even get "moderated." If you're going to be this lame, you might as well spice it up with some random scatology.

Posted by: JeffII on November 5, 2007 at 6:06 PM | PERMALINK

Indeed. Shorter mhr: "la la la liberal boogie man la la la."

Posted by: craigie on November 5, 2007 at 6:10 PM | PERMALINK

I am an equal opportunity megawatt fan. Solar and wind energy (and hydro where you can get it) are indeed very useful for many applications, and I have no problems at all making much larger public investments in them--not only are there megawatts to be gained, but there is also a lot of tech innovation and new products and markets to be had. (Cap and trade and carbon sequestration are helpful too--but ultimately you have to find a way to make more watts to begin with.) However, xperience outside the USA (where substantially more effort on alternates has been made than in the US) is that alternates are unlikely to provide a large percentage of bulk electric power requirements. Indeed, there are a number of technical studies indicating there would be power system stability problems if such intermittent sources got into the range >20% of total capacity. And even in central Australia (I am Aussie, and have been there)---where average solar power input per meter is the about highest it can be, the telephone company has to have one week of backup battery power for its isolated relay stations, and cattle stations are all equipped with diesel generators as well as solar panels. Australia has strong public and govt support for solar and wind energy, but nevertheless, recent studies have concluded that in the long term, some form of higher density, low-emissions power generation will be needed if Australia is to grow its industrial economy AND reduce its per capita emissions (which, sadly are near the highest in the world). And so the discussion of clean coal, nuclear power etc has been opened once more. I suspect that similar results will obtain sooner or later for most countries. This conclusion holds in spades for really densely populated countries like China, whose present capacity---with the 3 Gorges Dam ---is apparently~170 W per person, vs 2500 W per person in the developed world. The situation is only going to get harder as electricity demand rises---and it will likely really accelerate if the "plug in hybrid" car catches on as a way to decrease petroleum fuel use (I for one can't wait!). I would thus hate to see the Democrats---many of whose supporters are "proud members of the reality-based community" get trapped in a indefensible corner on this issue. So I hope the Clintonistas---and the Obamans, Edwardians, Kucinichi and all of the Congressional Dems---have some serious discussions with with broadly grounded energy experts, and not just zealots wedded to one scheme or another. And since she is for now the front runner, I sincerely hope that Hillary Clinton triangulates hard as she learns more about the issue. jhh

Posted by: Jeffrey Harris on November 5, 2007 at 6:32 PM | PERMALINK

Cap and trade is going to be a disappointing and time-consuming distraction from the task of reducing CO2.
Posted by: Scott Farris on November 5, 2007 at 5:55 PM
^^^^^^^^^

I agree. Here is what is going to do all of the heavy lifting:
(from grist.org):
"bold new CAFE targets (55mpg by 2030!)"

Posted by: Doc at the Radar Station on November 5, 2007 at 6:55 PM | PERMALINK

Obama's plan is cap and trade where permits are auctioned rather than distributed freely, so it acts more like a tax than than the others.

Posted by: CalDem on November 5, 2007 at 7:01 PM | PERMALINK

This conclusion holds in spades for really densely populated countries like China, . . . Posted by: Jeffrey Harris

China's already fucked. By all accounts, the cities all look like London circa 1885 with not even a glimmer of hope on the horizon for cleaner energy. Shows just how craven the "communist" leadership in China has been over the last two decades. If there ever was a large country with the chance to "do it right," if for no other reason in that they were starting pretty much from zero, China was it. And now that car ownership is increasing exponentially, there's really no hope. In fact, GM's counting on it. As its share of the U.S. market erodes faster than the Jersey shore, it's building capacity in China hoping to offset it's losses here.

Posted by: JeffII on November 5, 2007 at 7:14 PM | PERMALINK

It's fantastic that all of the major Democratic candidates are competing with each other to be better on the environment. I was hoping this would happen, and it is. So we win no matter what.

I noticed when comparing this plan with Obama's, Hillary takes a fairly anti-nuclear stance (let's improve what we have but not subsidize an expansion of nukes) while Obama takes the "serious" stance that more nuclear is inevitable.

For me, this makes Hillary better on the environment than Obama. Expansion of nuclear is looking to be a big, expensive corporate welfare program, and we have enough of those already.

Otherwise, the plans are both good in many of the same ways. Unfortunately they both focus on biofuels, but let's hope that the current anti-biofuel sentiment eventually filters up to the campaigns.

Posted by: Steve Simitzis on November 5, 2007 at 7:42 PM | PERMALINK

Cap and Trade crap - it was Bush's policy before it became Hillary and Bill's corporate lovefest.

Lots of economists and analysts on both sides of the aisle prefer a carbon tax to a cap-and-trade system, but political reality is such that the former is exceedingly unlikely and the latter has become all but inevitable. So it's time to focus on doing it well.

One question that came up in the panel Q&A was this: what makes for a good cap-and-trade system? This subject is both enormously complex and enormously relevant to current politics. We need the grassroots to be engaged, pushing back against the many half-ass measures on offer, lobbying on behalf of good measures

I can only imagine that Marc Rich would love it. Hillary is going to be just another damn Bush, hell, I bet she even keeps Bush secert prisons and waterboards people too. If Hillary isn't even going to end the war until 2013, then she planning on American staying longer in Iraq than we were in Veitnam.


Posted by: Me_again on November 5, 2007 at 7:50 PM | PERMALINK

Steve Simitzis, realistically, I think that given super high uranium prices (and a 50-yr decent supply of nuclear fuel?) and continuing resistance (NIMBY) to nuclear (despite any govt liability law changes) we will at best probably see a maintenance of the current 20% of electricity generation coming from nuclear. The BIG substantive changes will come from across the board structural conservation efforts-CAFE (transportation fuel), smaller better insulated houses (tax changes), public transit (finally!), the death of the SUV, etc.

Posted by: Doc at the Radar Station on November 5, 2007 at 9:12 PM | PERMALINK

Jeffrey Harris, your otherwise quite valid points are almost totally lost within that bloated mass of a paragraph you posted.

Posted by: Donald from Hawaii on November 5, 2007 at 10:21 PM | PERMALINK

Whoever told you that a cap and trade is essentially the same thing as an energy tax doesn't know what they are talking about.

Let's take an example. Let's say you are developing the world's lowest NOx emissions combined cycle power plant and you are doing so in Houston, Texas. Houston is non-attainment for NOx. So under a cap and trade system the world's cleanest plant will have to buy NOx allowances from an entity which has been polluting, or an entity which has bought emissions allowances from the legacy polluter. So the policy subsidizes the legacy polluter and creates a barrier to entry for the clean new entrant.

On the other hand, if the government taxes NOx emissions, the clean new entrant will have a competitive advantage vs. the legacy polluter and the government will have a revenue source to pay down the debt or use for some higher and better purpose.

The cap and trade system gets the incentives backwards and is much less economically rational than taxing emissons.

Posted by: anonymous on November 5, 2007 at 10:26 PM | PERMALINK

I think you could make a cap/trade system work similar to a carbon tax by allotting credits in equal apportionments to every living human (rather than granted to business entities). Each individual would get a tax credit for their portion (1/300,000,000) of the aggregate amounts paid by the carbon polluters.

It would seem very fair as each of us are being harmed equally (perhaps those in Key West a bit more)

This would appear to be a way to implement a cap/trade without adding a lot of friction/bureaucracy to the process.

That said, from an efficiency and transparency standpoint, carbon tax is still the better route.

Posted by: whynot? on November 5, 2007 at 11:07 PM | PERMALINK

"So under a cap and trade system the world's cleanest plant will have to buy NOx allowances from an entity which has been polluting, or an entity which has bought emissions allowances from the legacy polluter. So the policy subsidizes the legacy polluter and creates a barrier to entry for the clean new entrant."

It is not an intrinsic property of a cap and trade system that the emissions credits be given for free to existing polluters. It would be very stupid to set it up that way because of what you describe.

A smart cap and trade system would sell the credits. Likely by auction, just the way the government auctions other resources.

The reason that cap and trade seems better to me is that the government sets the amount to be emitted and the market figures out the price. With an emission tax the government would have to try to guess the tax rate which would cause a certain amount to be emitted.

The danger in the cap and trade is that the cap will be set too high, so the price will be zero. The danger in the carbon tax is that the tax will be set too low and emissions will not be reduced. Personally I think the first problem is likely to be a bit more evident to voters.

Posted by: jefff on November 5, 2007 at 11:25 PM | PERMALINK

Steve Simitzis, realistically, I think that given super high uranium prices (and a 50-yr decent supply of nuclear fuel?) Posted by: Doc at the Radar Station

I've never been a fan of nuclear power and admit to not knowing all that much about its workings, but I thought breeder reactors could provide an almost endless supply of fuel.

Posted by: JeffII on November 5, 2007 at 11:31 PM | PERMALINK

An A? Roberts ought to be ashamed of himself. Maybe it gets an A only if compared to other Democratic presidential candidates, but there's still too much pandering.

And, still, it's weighted heavy on global warming concerns, but no outright talk of Peak Oil.

Posted by: SocraticGadfly on November 6, 2007 at 1:20 AM | PERMALINK

Jeffrey Harris wrote: "Indeed, there are a number of technical studies indicating there would be power system stability problems if such intermittent sources got into the range >20% of total capacity."

Which is exactly why we need a new generation "smart" electrical grid, what Al Gore calls the "Electranet", that is (re)designed from the ground up to integrate diverse, distributed, intermittent power sources like rooftop photovoltaics and small-scale wind turbines, along with large centralized power sources like hydro, wind farms, and large concentrating solar installations.

The power grid is in bad shape anyway, so we are going to have to deal with this in any case. And it will be a hell of a lot less expensive than building hundreds of nuclear power plants, and far less dangerous.

Jeffrey wrote: "The situation is only going to get harder as electricity demand rises---and it will likely really accelerate if the 'plug in hybrid' car catches on as a way to decrease petroleum fuel use (I for one can't wait!)."

Actually, plug-in hybrid cars can be part of the solution, by providing storage for intermittently-generated electricity, which can be fed back into the smart grid when the cars are not in use.

We can phase out both coal and nuclear power.

Posted by: SecularAnimist on November 6, 2007 at 7:57 AM | PERMALINK

JeffII wrote: "I thought breeder reactors could provide an almost endless supply of fuel."

Or an endless supply of weapons-grade nuclear materials, depending on how you look at it.

Posted by: SecularAnimist on November 6, 2007 at 7:59 AM | PERMALINK

Jefff,

I will grant you that a cap and trade system could be designed that would be better than the existing system and would not favor legacy polluters as much as the existing cap and trade system.

That said, the legacy polluter special interests who will be making campaign contributions, hiring lawyers and lobbyists, etc. I'd bet that any complicated regulatory system would be tilted toward the incumbents.

With a comparatively simpler tax system, there would be lower regulatory transaction costs, if you don't get adequate emissions reductions you can raise the tax rate, etc.

Posted by: anonymous on November 6, 2007 at 9:28 AM | PERMALINK

Hillary's plan will be phony unless it relies heavily on organic fuel use, and I don't mean the political racket of corn ethanol.

Posted by: Neil B. on November 6, 2007 at 12:24 PM | PERMALINK

Is there any major policy proposal that Hillary has made BEFORE Edwards and Obama?

Posted by: waka waka on November 6, 2007 at 1:13 PM | PERMALINK

"I'd bet that any complicated regulatory system would be tilted toward the incumbents."

That complaint is valid for any possible system.

If the system is completely corrupt a carbon tax would also completely fail. The tax will be set too low, existing polluters will all be given loopholes, and enforcement will be a joke.

Posted by: jefff on November 6, 2007 at 1:43 PM | PERMALINK

Really though the biggest evidence of a corrupt system is that we continue to do nothing at all.

Posted by: jefff on November 6, 2007 at 1:45 PM | PERMALINK

I've never been a fan of nuclear power and admit to not knowing all that much about its workings, but I thought breeder reactors could provide an almost endless supply of fuel.
Posted by: JeffII on November 5, 2007 at 11:31 PM
^^^^^^

I've not been a super enthusiast either, but I don't think we can practically supply 100% of our electricity (before fusion becomes practical) with renewables alone. I think we *might* be able to slowly phase out nuclear, but only if we can pull off clean coal with carbon sequestration. We are doing 50% of our power with coal right now, and 20% nuclear. Just don't see how you are going to quickly come up with 70% with renewables, sorry.

As far as the breeder reactors go, SA is right, they can easily be turned into weapons grade plutonium factories. But, I've heard that even the light water reactors can be used for that as well. The biggest drawback of breeder reactors IMO, besides weapons diversion is the need to use liquid metal coolants. You can't use light water in them. That decreases their safety a lot IMO. There is supposed to be a heavy water version that might be possible. That all sounds expensive especially with all the extra fuel processing involved.

Posted by: Doc at the Radar Station on November 6, 2007 at 6:53 PM | PERMALINK

good site
expecting democrate will win those election first!
gruss
vfx
valery francois xenakis

Posted by: VFX on November 13, 2007 at 3:30 AM | PERMALINK




 

 

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