With cap-and-trade on the ropes, what’s the next move for greens?
The final fate of the climate/energy bill is uncertain. There are signs Senate Democrats may yet try to advance a price on carbon, perhaps a limited system that only covers utilities, but it remains a heavy political lift. It’s a safe wager cap-and-trade won’t make it over the finish line.
So let’s look ahead: What should greens be focusing on next? I called up seven of Grist’s favorite journos and wonks, and we’ll be sharing their thoughts today and tomorrow.
Our illustrious panel:
- Amanda Little, Grist alumnus and author of Power Trip: From Oil Wells to Solar Cells — Our Ride to the Renewable Future
- Ezra Klein, political and policy blogger at The Washington Post
- Michael Levi, senior fellow at the Council on Foreign Relations
- Vicki Arroyo, executive director of the Georgetown Climate Center
- Josh Freed, director of the clean energy program at Third Way
- Jesse Jenkins, director of energy and climate policy at the Breakthrough Institute
- Terry Tamminen, former environmental advisor to California Gov. Arnold Schwarzenegger, now lecturer and consultant
Today, the panel answers this question:
If it’s true that a carbon price is impossible this year, what policies should energy reformers rally around in the short-term?
Amanda Little: Enviros need to push for radical efficiency measures to cut America’s oil demand. If there was ever a time to convince America that we need to rein in our appetite for oil, it’s when there’s a layer of brown scum the size of Wyoming covering the Gulf of Mexico like a funeral shroud.
I’m going to go out on a limb and say it may be time to forcefully make the case for a gasoline tax (with provisions to protect lower-income Americans and car-dependent professions). A gas tax is widely regarded as political suicide, but the spill may be enough of a game-changer to help make the case for it. The message has to be: The most prudent and patriotic thing Americans can do right now is use less oil. The bill should also aggressively push for other oil-saving measures like further ramping up vehicle efficiency standards and making a much more significant push for public transit.
Ezra Klein: You need to do two things: make renewables more price competitive, and fund an effort to make renewables more price competitive. The nice thing about a carbon price is that it does both. It changes the relative price of fossil fuels and gives you a pot of money to fund investment. You can do a lot of what you can do with the carbon price through an enormously expensive, inefficient raft of subsidies, giveaways, and bribes. You could pay every American $10,000 to put a solar panel on their roof. You could pay everybody who works at a coal plant $2 million to find another job. The issue is whether you want to do these things efficiently. If you don’t want to do them efficiently, we can turn our attention, as we have so many times before in American history, to doing them wildly inefficiently. The question then becomes where you get the money.
Michael Levi: The reality is that the kinds of carbon prices we see in these bills aren’t by themselves up to the challenge. That doesn’t necessarily mean the bills themselves and U.S. efforts aren’t up the challenge — it means a lot of the heavy lifting, at least in the near-term, will come from other policies. Getting those other policies right is extremely important.
First, we need to make sure we don’t come to a rocky ending when the stimulus peters out. We need to think about how to go long-term with some of that [funding]. Firms just don’t take those super-long-term kind of risks. You need government support to reduce their risks. Second, try and find reductions related to oil consumption. There’s this irony that people are reacting to the oil spill by pushing for utility-only cap-and-trade when its main selling point is that it doesn’t do anything about oil. It makes it even tougher to call it an energy-independence bill. Third, if you believe all these domestic offset efforts are serious, it might be worth promoting some of that activity through a combination of direct incentives and regulation. I know regulation would be unpopular, but if it were combined with incentives, it could fly.
Vicki Arroyo: Even if they go with something different, whether it’s a low-carbon portfolio standard or some other low-carbon fuel standard, it has the effect of sending a price signal, right? It may be the hidden way to do it, the way that picks winners, and more politically palatable, but in a way it’s just a matter of semantics.
It could be that we start sector by sector — that’s something I’ve been hearing for years from swing voters up on the hill. There may be some efficiency in doing this all at once and making sure all sectors are doing their fair share, but getting comprehensive legislation through, whether it’s immigration reform or climate change, is difficult. My sense is that people have moved on from the concern about trying to do everything at once.
Josh Freed: We need a price on carbon if for no other reason than to pay for everything we need to do. There’s potential to take a bite out of emissions and start the country on the right path, but a lot of it’s expensive.
We like the idea of fuel-switching for heavy vehicles — replacing diesel trucks with natural gas. It helps address the oil crisis. We also need to include as many incentives for energy efficiency as we can — both Home Star and the Rural Energy Savings Program, which has broad bipartisan support in the Senate. A renewable energy portfolio standard — or, to get the votes you need, an RPS plus nuclear — needs to be included. Nuclear loan guarantees, so we can start to move away from relying on coal as much as we do for baseload. And the other critical component is investing a lot more in innovation.
Jesse Jenkins: The focus for the remaining few weeks left has to be on substantive steps forward we can take without ceding ground or giving up too much in the way of opportunity cost. There’s not a lot of time left to rally support for new ideas, so it has to be something that’s already on the drawing board, like vehicle electrification and other efforts to win our freedom from oil. One big opportunity that’s been ignored is the America Competes Act, which would authorize a number of key provisions to strengthen our clean energy innovation system in the United States. Some of those provisions could be put into Senate energy legislation. And there’s the Clean Energy Deployment Administration, which could be an important part of financing emerging, innovative technologies. I would hate to see that fall through the cracks.
Terry Tamminen: I would stop focusing on the glass that’s empty and focus instead on the one that’s full. We already have a price on carbon in 10 Northeastern states, at least as it pertains to the electricity sector, under RGGI [Regional Greenhouse Gas Initiative]. We are in the final stages of designing a similar cap-and-trade system in the majority of the Western states, and the Midwestern states have said they’ll copy what we do. So by 2012, regardless of what Congress does, if we support these state actions — which are much more deeply rooted and have a lot more political support and practical demonstration of success — we are much more likely to have a price on carbon in the U.S. in the near-term.