Climate Climate & Energy

Five nations agree to think about ending oil subsidies

The day after markets registered the highest single-day rise in crude oil prices ever, the United States and Asia's four largest economies (Japan, China, India and South Korea), meeting in Aomori, Japan in advance of the G8 Energy Ministers summit, have formed a sort of Petro-holics non-Anonymous club, calling for an end to oil subsidies in their countries.

Consumer subsidies (subsidized fuel prices), that is, not producer subsidies.

OK, what they actually agreed upon was "the need" to remove fuel-price subsidies. Eventually.

According to a report by Agence France-Presse, the five nations announced in a joint statement:

"We recognize that, moving forward, phased and gradual withdrawal of price subsidies for conventional energies is desirable. Undistorted and market-based energy pricing" would help "enhance energy efficiency and increase investment in alternative sources of energy." They said that subsidies "should be replaced wherever possible by better targeted policies for intended beneficiaries. Such a move "could also lead to reduction in the government cost and greater integration of the domestic and global energy economies."

A carbon policy is likely to be less devastating than nature, or oil markets

Reihan responds. Let me just say a few more things. First, I described his characterization of carbon pricing as “insane” based on this: What we need is a $100 billion prize or set of prizes to the person or firm or non-profit entity that can devise a cost-effective means of scrubbing the atmosphere of carbon […]

What does Barack Obama think of McCain’s conviction on climate change?

From Obama’s remarks to his campaign staff: “Those of you who are concerned about global warming? I don’t care what he says, John McCain is not going to push that agenda hard.” It’s about 11 minutes in: (via SameFacts)

Saudi Arabia and oil

I recently found a pretty good NYT Magazine article on oil production. It's definitely worth a read, if for no other reason than as a reminder of how much things have changed since the article was written in 2005. For example, on page 1 comes the quaint statement:

If consumption begins to exceed production by even a small amount, the price of a barrel of oil could soar to triple-digit levels.

Yes ... yes it could. Here's another one:

An acknowledge-and-do-nothing strategy is little better than denialism

Reihan Salam writes an incredibly disappointing, and boggling, blog post here, on his preferred strategies for dealing with climate change. Disappointing, because if Reihan, one of the best conservative writers out there, doesn’t get the logic of carbon pricing, then there’s little hope for some sort of conservative renaissance on climate change policy. Boggling, because […]

Now that L-W is dead, Barnes’ sky trust is looking good

Revkin speculates that Barnes' proposal is a way to break the deadlock stopping climate change legislation.

I think he may be right. Tax emissions. (Or cap them and auction permits.) Refund the revenue to everybody. It has the following political advantages:

• It is simple and easy to understand.
• It puts a price on emissions without really penalizing anybody. It is a no-hair-shirt solution.

This last point is worth emphasizing. It does not punish consumers, because the increased prices they pay are made up for by the dividend check. It does not really punish fossil fuel companies, because the tax they pay gets passed along to customers who have new money to pay those increased prices. Of course, fossil fuel companies do lose, as people use less of their product, but that is not punishment; it is an inevitable result of their selling a product whose side effects can no longer be tolerated. Since it will take time to phase out fossil fuels, oil and coal companies are free to use the time tax-and-dividend gives them to make the transition to other businesses, perhaps by expanding the investments they have already made in wind and solar.

I'm going to post soon on why I think the people who think tax-and-dividend (or any mechanism depending on price) can be the sole, or even main, solution are wrong. Price is insufficient by itself; public investment and rule-based regulation have to remain the primary solutions. But price is not avoidable as part of the solution.

Country songs dedicated to your favorite climate personalities

Dedicated to the coal and nuclear industries: Lorrie Morgan's What Part of No Don't You Understand?

Dedicated to Scott McClellan: Randy Travis' Pray for the Fish:

Peter Barnes on cap-and-dividend in U.S. News & World Report

Peter Barnes' proposal is popping up everywhere these days, most recently in U.S. News and World Report. The idea is simple: Put a cap on emissions, and divide that cap into permits. Sell those permits upstream -- mostly to just a few hundred fossil fuel producers and importers. They in turn will pass the cost of those permits on to consumers. Divide the revenue from the auctions among consumers, which makes up for the higher prices.

Read the article for details.

Update: "Rebate" changed to "Refund" as GreyFlcn suggested.

He rules their world

On the Drudge Report homepage right now: Gotta love those scare quotes.

BBC program on Kyoto offsets

The idea behind offsets is that you pay someone else to reduce emissions on your behalf when they can make the reductions more cheaply than you can. The leading offset method use to fight climate chaos is the Clean Development Mechanism. This is an extremely controversial topic, with many (including me) contending it does not work. The BBC has an excellent radio broadcast covering both sides of the controversy. The broadcaster concludes that offsets don't make sense. But he gives leading intelligent pro-CDM experts plenty of time to make their case. It is an example of a program that is, while not the least bit objective, still being fair.