Sunday, June 20, 2010
The Week That Was (to June 19, 2010)
By Ken Haapala, Executive Vice President, Science and Environmental Policy Project
On Tuesday, IPCC Chairman R.K. Pachauri gave a rather remarkable interview on BBC, claiming that he welcomes a vigorous debate on the science of climate change. (See quote above.) Of course, the skeptics may continue to be a bit skeptical. Pachauri has called them “flat earthers” who should apply asbestos to their faces.
Given the revelations of ClimateGate, perhaps Pachauri is concerned about his job – one from which he claims he receives no income. Or, perhaps, he has genuinely undergone a remarkable transformation.
We shall have to wait and see. An early indicator may be if the IPCC actually tries to test some of the critical assumptions in the computer models, such as that water vapor amplifies (is a positive feedback to) the slight warming produced by increased atmospheric carbon dioxide.
Another indicator could be attempting to establish empirical parameters on the effects of aerosols that are “hiding true global warming.” The acid test will be permitting skeptics to write dissenting views in the “Summary for Policymakers.” (One can always dream.)
The BP oil spill continues to have considerable political ramifications, with vengeance as a motivating factor for some. BP has been forced to set up, early, a $20 Billion fund to provide relief for those economically impacted by the spill – including those put out of work by the government’s declaration of a moratorium on all deep water drilling. As explained in last week’s TWTW, the administration attempted to justify this moratorium, claiming it was recommended by highly qualified engineers. The engineers would have none of that and stated they made no such recommendation for existing permits.
Efforts to control the extent of the spill are still underway. Unfortunately, in spite of administration claims that it has been in charge since day one, there still appears to be no one in charge and conflicting statements are the order of the day.
Politicians and the environmental industry are gearing up to make the most of this spill. Numerous articles and television broadcasts are long on adjectives and lurid photographs, but short on facts. What is the actual extent of the environmental damage? Clearly, no one can predict how long the aftereffects will remain, but it appears that once the well is shut off, most of the effects will disappear rather quickly.
What about the wildlife that is so frequently shown in photographs? US Fish and Wildlife has established a control center, monitoring affected birds, sea turtles, mammals, and reptiles. These are classified by alive or dead and by visibly oiled, no visible oil, or status pending. Visible oil on a dead animal does not mean the animal died from oil exposure. As of June 17, with 58 days of records, of the 1468 alive and dead birds collected, the total number of visibly oiled, dead birds was – 196 – a far cry from the impression one receives in the news reports. The data tables can be found at this web site
The fate of the cap and tax law (Kerry-Lieberman bill – S-1733) is uncertain. The administration is using the oil spill to justify penalizing oil as well as coal – thus further penalizing American prosperity. Proponents are also bringing up the issue of American security – reliance on oil from the Mid-East. Thus, it is useful to examine the source of imported crude oil by region as reported by the Energy Information Administration for 2009.
Of the 4,279,908 barrels of crude oil and similar products imported by the US, only 620,938 (14.5%) came from the Persian Gulf states which is less than the 899,370 barrels (21%) that came from Canada. The five major nations from which US imports oil are, in order: Canada, Mexico (10.5%), Venezuela (9.2%), Saudi Arabia (8.6%), and Nigeria (6.9%).
It is important to distinguish the uses of various fuels. Oil is the major transportation fuel and only about 1% of US electricity is generated from it. By contrast, coal is principally an electricity generating fuel with almost 50% of US electricity generated from it. As it is now being restructured, the targets of cap and tax will not only be electricity, but also transportation.
Last week, TWTW mentioned the review in Science of Merchants of Doubt by Naomi Oreskes and Erik Conway. This week the George C. Marshall Institute issued its comments on this book which focused on the attack on three of the Institute’s founders: Frederick Seitz, Robert Jastrow, and William Nierenberg. The comments on Seitz suffice for all. Oreskes-Conway accuse Seitz of consulting with R.J. Reynolds to discredit studies showing a link between cigarette smoking and cancer.
The Institute admits that Seitz did consult with R.J. Reynolds – to guide a multi-year, multi-million dollar investment in human health research and development at Rockefeller University, a leading bio-medical research institution. This effort funded the research by Dr. Stanley Prusiner, who received a Nobel Prize for his work on prions. Strangely, the Science article made no mention of this scientific research. If this scientific research is somehow “tainted”, how should one consider research at Duke University, founded with tobacco money, or Stanford University, founded with railroad money, or that at many other universities?
A Congressional candidate with a degree in Physics from Harvard is an outspoken skeptic
Mike Stopa is running for U.S. Congress from the third district of Massachusetts. His site is here
Global Average Sea Surface Temperatures Continue their Plunge
Sea Surface Temperatures (SSTs) measured by the AMSR-E instrument on NASA’s Aqua satellite continue their plunge as a predicted La Nina approaches. The following plot, updated through yesterday (June 17, 2010) shows that the cooling in the Nino34 region in the tropical east Pacific is well ahead of the cooling in the global average SST, something we did not see during the 2007-08 La Nina event (click on it for the large, undistorted version):
The rate at which the Nino34 SSTs are falling is particularly striking, as seen in this plot of the SST change rate for that region:
To give some idea of what is causing the global-average SST to fall so rapidly, I came up with an estimate of the change in reflected sunlight (shortwave, or SW flux) using our AMSR-E total integrated cloud water amounts. This was done with a 7+ year comparison of those cloud water estimates to daily global-ocean SW anomalies computed from the CERES radiation budget instrument, also on Aqua:
What this shows is an unusually large increase in reflected sunlight over the last several months, probably due to an increase in low cloud cover.
At this pace of cooling, I suspect that the second half of 2010 could ruin the chances of getting a record high global temperature for this year. Oh, darn.
SOURCE (See the original for links & graphics)
The Unscientific American again
Does the "Scientific American" still employ scientists? They certainly still employ credulous journalists. I reproduce the first part of a rave by a panic-stricken little fluff-head below and follow with some comments by "eminence grise" Fred Singer. See also the article following the one below
The EPA found there is only a 1% chance of avoiding the increasing incidence of climate-caused catastrophes like floods, droughts and sea level rise without passage of this year’s American Power Act (APA) to place a cap on carbon emissions and then lower the pollution permittted each year.
This week the EPA released its findings on the environmental impact of the legislation: a 75% chance of a livable climate with passage of APA, only a 1% chance without it. Armageddon that is preventable, by our actions.
Yet, despite these truly dire findings for the real cost to us of inaction, news stories covered the estimate of the financial impact if we do act (20 – 40 cents a day or less than a postage stamp) but completely omitted any mention of the only 1% chance at a future in which to spend pennies, if we don’t act.
A 99% chance of catastrophe without legislation that is under threat of filibuster by the Senate GOP should be news to all US voters, including the increasing numbers of climate-related disaster victims, not just to readers of Wonkroom and the NRDC.
Especially when the odds are much better of keeping global average temperature rise below 2° C (or 3.6° F) if we pass climate legislation this year....
Fred Singer points out that the journalist has simply swallowed the EPA assertions, hook, line and sinker:
EPA's 'analysis' of the American Power Act is so bad, I wonder if a response to Scientific American is worthwhile.
1. It assumes a climate sensitivity that is not justified by any evidence
2. It ignores all forcings except CO2
3. It assumes that China and India will go along in rationing energy use
4. It uses the 'magic' 2 degC threshold -- for which there is no scientific evidence
5. It assumes that Floods, Droughts etc will all increase with temp
6. It ignores the benefits of GW and Increased CO2
7. It uses made-up risk probabilities, disguised as science
EPA's New Analysis of Cap and Trade: Same Old Faulty Logic
The Environmental Protection Agency released its economic analysis of the Kerry-Lieberman cap and trade legislation, the latest cap and trade bill to be released in the Senate. The result was nearly the same as the EPA’s analysis of the Waxman-Markey cap and trade bill passed in the House of Representatives last year: postage stamp per day costs. Instead of $176 per household for Waxman-Markey, Kerry-Lieberman would cost households $146 by 2050. Unfortunately for Americans, nothing substantial in the EPA analysis has changed; it is still unreasonable, faulty, and fragile. The reality remains that cap and trade is a substantial energy tax that will cause trillions of dollars in economic damage and kill jobs.
Inappropriate Use of Discounting
Most misleading in the EPA analyses of cap and trade is the use of discounting. A discount rate is an interest rate used to find present value of an amount to be paid or received in the future. In other words, present value analysis answers the question: How much would I have to have today in order to meet my financial obligations or pay certain costs in the future? Discounting is a legitimate tool in finance and for cost-benefit calculations. But discounting can give a much distorted view of costs, as is done by those misrepresenting the EPA analysis. Here’s an example to help clarify:
Imagine that a time machine takes analysts back to 1969 — a time when the average price of a new car was about $3,500. Once back in 1969, the exercise is to explain to Congress how much a new car will cost 40 years later in 2009. Having already lived to see 2009, we know the average price for a new car is about $23,000. But telling the Congress of 1969 that in 40 years cars will cost $23,000 would give an exaggerated notion of the cost increase, because inflation alone will have increased prices by a factor of 5.8. If inflation is taken into account, the price of a new car in 2009 is about $4,000 in 1969 dollars. This conveys the most meaningful measure of the cost.
Taking this inflation-adjusted (1969 dollars) $4,000 price of the average new car in 2009 and discounting it in the EPA fashion would generate a present value in 1969 of $562. This is clearly much less than the cost of an average car in 2009, even after adjusting for inflation.
What then is this $562? It is the amount when invested for 40 years, at an interest rate guaranteed to be 5 percent above inflation that would buy the $23,000 car. In other words, if a person in 1969 invested $562 at 9.72 percent interest (5 percent above inflation), letting the entire interest compound and paying no taxes, it would now amount to $23,000, enough to buy a new car.
The same holds true for the EPA’s use of discounting. The discounted value is not the amount households will have to pay each year, even with discounting. In the most generous case, the present value is the amount that would have to be paid for one year, right now, if the present value for each of the 40 years were paid in one lump sum right now — that is, if the cost for all 40 years were paid at once. So no matter how it is sliced, there is no sense in which a postage stamp (or even one dollar) per day reflects the annual cost of the cap-and-trade legislation.
Doesn’t Fully Measure Costs
The EPA uses household figures and measures consumption changes only. First, a household is not necessarily a family. The average household size is 2.6 people. Adjusting household size to a family-of-four standard adds another 53 percent.
Secondly, consumption changes are typically less than income changes, as families respond to income losses by saving less. When income drops, people prevent consumption from dropping by dipping into savings. In turn, lower savings reduces the ability of families to cope with other shocks and reduces their future income. Further, consumption comes from after-tax dollars, so losses in tax revenue do not show up in data on household consumption. The real economic cost is the loss of income. Change in national income, as measured by gross domestic product (GDP), is a better measure of the overall economic impact of a policy.
In the end, Americans will be much poorer and the economy would be trillions of dollars weaker with climate change legislation in place than without it, as Heritage Foundation analyses of past cap-and-trade bills have shown.
The EPA reports that “The APA is estimated to lead to a significant decline in electricity generation from non-CCS fossil fuels — a 23% decrease from 2010 levels by 2030 and an 81% decrease by 2050. This is in stark contrast to the expected steady increase in non-CCS fossil fuel electricity generation without the APA policy – a 22% increase by 2030 and a 56% increase by 2050.”
To get there, the EPA includes generous assumptions, specifically on the use of carbon capture and sequestration (CCS), the use of offsets and the increase in nuclear power. With CCS, even after extraordinary technological and economic hurdles have been cleared, there are more political and environmental obstacles to storing 15 supertanker’s worth of liquid CO2 every day. The considerable regulatory and legal hurdles to CCS
have been noted by the Congressional Budget Office:
“Similarly, generators would be unlikely to adopt technologies for the capture of CO2 and its sequestration in the ground unless an extensive regulatory structure was put in place to address issues involving property rights, rights-of-way for pipelines, and liability for emissions that escape from the ground.”
Anyway, it’s no surprise the costs are higher in the EPA’s model where CCS is delayed.
The use of offsets is another highly contentious program that is subject to fraud and will produce dubious results. With offsets a coal plant operator can forego cutting CO2 emission and, instead, pay someone else to do so. For instance, a company could pay a logger not to cut down trees, or they could pay someone to grow trees since trees absorb carbon.
Or a developing country can build a cleaner coal plant saying they were going to build a dirtier one while cashing a check from a developed country for the alleged carbon offset. Laurie Williams and Allan Zabel, two lawyers working for the EPA who oversaw California’s cap and trade and offsets programs, have serious doubts about the effectiveness of the offset provision. They make a similar case with forest owners:
“[I]f the landowner wasn’t planning to cut his forest, he just received a bonus for doing what he would have done anyway. Even if he was planning to cut his forest and doesn’t, demand for wood isn’t reduced. A different forest will be cut. Either way, there is no net reduction in production of greenhouse gases. The result of this carbon “offset” is not a decrease but an increase — coal burning above the cap at the power plant.”
Another sign of problems with domestic and international offsets is that the Kerry-Boxer bill devoted 90 pages to outlining the regulatory structure for certifying and handling offsets.
Furthermore, trying to increase the production of nuclear energy in the United States, without proper regulatory and waste management reform, will stick us with only a handful of reactors—just the ones the government subsidizes through loan guarantees. Although the nuclear title in Kerry-Lieberman is strong on regulatory reform, it does little to address waste management and includes a host of subsidies for nuclear. This doesn’t get us the nuclear renaissance assumed in the EPA economic analysis.
No Green Stimulus, No Environmental Benefit, Minimal Oil Reduction
Even the most generous scenario in this EPA report shows that costs will be forced on the economy—higher energy prices and lost income. For every year reported, household consumption drops compared to a world without Boxer-Kerry. This is a climate bill and, even according to the EPA, it will reduce economic activity. Spinning this as a job-creating, green stimulus bill is simply untrue.
Regardless of whether the lower cost estimates are true, this bill provides negligible environmental benefit. Global temperature reduction from Kerry-Lieberman would be .077 degrees Fahrenheit by 2050 and 0.200 degrees by 2100. And despite the best attempt for politicians to marry the Gulf oil spill and cap and trade legislation, even the EPA analysis shows cap and trade will do very little to cut petroleum use (page 31).
Yet, after President Obama’s speech in the Oval Office, former Vice President Al Gore said, “Placing a limit on global warming pollution and accelerating the deployment of clean energy technologies is the only truly effective long-term solution to this crisis.” Cap and trade is an effective solution to raise energy prices for years to come and choke our economy, but that’s about it.
The Immutable Law Of The Potomac
Sen. Joe Lieberman believes American households are "willing to pay less than $1" a day to stop global warming. The Connecticut independent needs a lesson in the history of government program costs.
Lieberman and Democratic Sen. John Kerry of Massachusetts introduced in May a nearly 1,000-page climate bill they say is necessary for cutting the man-made carbon dioxide emissions they believe are warming the earth. Their goal, through the legislation's cap-and-trade components, is to reduce CO2 emissions 17% below 2005 levels 10 years from now by setting prices on carbon.
A 74-page study by the Environmental Protection Agency released Tuesday said that the cap-and-trade provisions of the American Power Act would cost an average U.S. household from $80 to $150 a year. Lieberman was clearly pleased by the analysis.
But he nonetheless warned that "there'll be some people who will want to demagogue that politically" — before resorting himself to a bit of demagoguery by noting that the EPA's cost estimate is "less than $1 a day."
Lieberman should be disabused of this fantasy and shamed into telling the country the truth. The cost will be higher, much higher. A Heritage Foundation analysis of a similar cap-and-trade bill found that the legislation would by 2035 cause a total GDP loss of $9.4 trillion, reduce the average family's net worth by $40,000 and cost 2.5 million jobs.
In making his less-than-a-dollar-a-day claim, Lieberman ignores a law of the Potomac: Government programs are never as inexpensive as those who support them say they will be. Neither are the taxpayers as unmolested as the lawmakers who pile on larger loads of mandates promise they will be. It is the nature of government programs and regulations to cost more than their advertised price.
As we have noted before, no program has exceeded its projected costs more egregiously than Medicare. When it was created in 1965, the public was told that its hospital portion would cost a mere $9 billion by 1990. The real cost, though, was $66 billion.
For all parts of the Medicare program, the cost was projected to be $12 billion by 1990. Yet it actually cost $107 billion.
When a fourth part — the prescription drug benefit — was added to Medicare in 2003, Washington was still having trouble calculating future costs. When the program was being debated, the public was told it would cost $400 billion in its first decade. After it was passed, forecasts assumed the program would cost $534 billion across its first 10 years. Then, within the space of a few months, the projection jumped to $1.2 trillion.
The cost of Medicaid, the government's health care system for the poor, has followed an upward trend similar to that of Medicare. Launched in 1965, it was supposed to cost $9 billion by 1990. But after that quarter of a century, Medicaid's real cost was $67 billion.
A special hospital subsidy was added to Medicaid in 1987 that Washington said would cost $100 million in five years. Yet the government spent $11 billion on it.
The architects of Medicare and Medicaid should have learned from Social Security, which began collecting payroll taxes 28 years earlier. The tax rate needed to keep that monster fed has grown sharply, from 1% to 12.4%, (total of the combined "contributions" from both employee and employer).
Less than a dollar a day? Not a chance. And Lieberman should know better. He's been in Washington long enough to appreciate that spending estimates in that town are worth less than a congressman's word.
Even if the EPA estimate is correct, there is also the question of effectiveness. Why should Americans be forced to spend even a single dime on a program that's not needed and would be grossly ineffective? Not needed, because the scientists who believe in global warming are just guessing. And grossly ineffective because, according to climatologist Paul C. Knappenberger, the American Power Act would cut global temperatures by only 0.077 of a degree Fahrenheit by 2050 and 0.2 of a degree by 2100.
At less than a dollar a day, it's still a poor investment because there simply is no return. Paying for Lieberman and Kerry's vanity legislation would be like paying for a ride on a unicorn: The promise will never materialize.
For more postings from me, see DISSECTING LEFTISM, TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC, GUN WATCH, SOCIALIZED MEDICINE, AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL and EYE ON BRITAIN. My Home Pages are here or here or here. Email me (John Ray) here. For readers in China or for times when blogger.com is playing up, there are mirrors of this site here and here
Posted by JR at 3:38 PM