Thursday, March 29, 2007

Colorado Governor Signs Renewable Energy Laws - Doubles Renewable Energy Standard to 20% by 2020

Colorado is now officially the latest addition to a growing list of states who have recently expanded their successful, existing Renewable Energy Standards.

Tuesday, Governor Bill Ritter signed into law House Bill 1281 which expands the Renewable Energy Standard enacted by Colorado voters in 2004. The bill doubles the standard enacted by voter-approved Amendment 37 from 10% by 2015 to 20% by 2020. HB 1281 passed both the House and Senate with broad support, with a 59-5 vote in the House and a 27-8 vote in the Senate.

"These new laws will improve our economic security, our environmental security and our national security," Governor Ritter said. "They will breathe new economic life into rural Colorado. They will create new jobs, and they will say to the rest of the world, 'Colorado is open for business in what will be one of the most important industries of the 21st century.'"

But Colorado has some tough competition: California, Texas, Nevada, Arizona, Minnesota and New Mexico all recently upped their Renewable Energy Standards as well to comparable or even higher levels. And some states that are coming later to the game are aiming big: Oregon's legislature is currently considering a 25% by 2025 standard that would put Oregon up towards the front of the pack [See previous post].

All of these states talk are competing for jobs in the growing cleantech/renewable energy field, one of the fastest growing new industries in the United States. The fierce competition to be "the Renewable Energy Capitol of the United States" is a good sign of the robust market ahead for renewable energy in the U.S.

Governor Ritter also signed into law Senate Bill 100 on Wednesday. SB 100 is a bill designed to encourage investment in the transmission necessary to bring new wind and other renewable energy to load centers in Colorado.

The Governor's office released the following fact sheets explaining HB 1281 and SB 100:

Fact Sheet for House Bill 1281 and Senate Bill 100

House Bill 1281
  • Sponsors: Sen. Gail Schwartz, D-Snowmass Village; Rep. Jack Pommer, D-Boulder; and Rep. Rob Witwer, R-Genesee.

  • Doubles the renewable energy standard established by voters with the 2004 passage of Amendment 37.

  • Large investor-owned utilities like Xcel must now provide 20 percent of their electricity from renewable sources such as wind and solar by 2020.

  • Requires municipal utilities and rural electric providers to achieve a renewable energy goal of 10 percent by 2020 (they had been excluded from the requirements of Amendment 37).

  • Provides a 3-to-1 credit to rural electric associations for investment in solar energy.

  • A recent study [see previous post] found HB 1281 would provide significant economic benefits, particularly to rural Colorado, by:
    o Increasing Colorado’s share of the GDP by $1.9 billion through 2020.
    o Increasing total wages paid to workers by $570 million.
    o Increasing the workforce by 4,100 person-years of employment.
    o Providing farmers, ranchers and other landowners with $50 million in lease payments for wind farms, crops and solar parks.
    o Generating $400 million in property tax revenue through 2020 to fund education and other services, particularly in rural Colorado.

  • Senate Bill 100
  • Sponsors: Senate President Joan Fitz-Gerald, D-Coal Creek Canyon, and Rep. Buffie McFadyen, D-Pueblo West.

  • Requires electric utilities subject to rate regulation to identify high-potential wind-energy locations by undertaking biennial reviews to designate “Energy Resource Zones” where transmission constraints hinder the delivery of electricity.

  • These utilities are then required to develop construction plans to improve transmission capacity.

  • The bill allows utilities to recover costs during construction.

  • Allows us to break the “chicken and the egg” cycle whereby wind companies don’t build turbines until there is adequate transmission capacity, and utilities don’t build transmission capacity until there are turbines.

  • [Image credit:]

    Tuesday, March 27, 2007

    Challenges Remain as Fledgling Cellulosic Ethanol Industry Moves Forward

    [From the Omaha World-Herald:]

    The logistics of collecting and storing a million tons of corn stubble each year for an ethanol refinery are mind-numbing.

    It would take 67,000 semitrailer loads to haul the baled stubble out of the field. That's 187 truckloads a day, or one every eight minutes. To complicate matters, the need for trucks, machinery and manpower would come during harvest, already the busiest time of the year on the farm.

    And that's where a massive federal initiative into cellulosic ethanol may find its biggest bottleneck - on the farm.

    "Naturally, the farmer says, 'Wait a minute. I've got enough stuff in my field,'" said Lex Thompson, president of the Imperial, Neb., Young Farmers and Ranchers Association.

    The question is whether farmers will harvest and sell the nongrain plant material, known as cellulose or biomass, to make the federal government's plan for renewable fuels work.

    The U.S. Department of Energy wants to replace 30 percent of the nation's petroleum needs with ethanol by 2030. That goal would require some 40 billion to 45 billion gallons a year from biomass ethanol, a technology not yet in commercial production.

    "If we can get the farming community's support," said Andy Aden, senior researcher at the National Renewable Energy Laboratory in Golden, Colo., "then all the pieces are falling into place and some real progress can be made."

    But farmer buy-in remains to be seen, said Imperial farmer Rod Johnson.

    "Our main concern is $4-per-bushel corn (worth $750 to $800 an acre)," Johnson said. "Thirty dollars an acre for biomass is a minor concern for our operation."

    The Energy Department wants researchers to develop a harvest and storage process that would provide material to a refinery for $35 a ton, a level that probably would make ethanol production profitable.

    Opinions differ, however, on whether that is achievable. Some in the industry believe the cost to ethanol plants would be closer to $60.

    Iowa State University researchers agree that the technology is not yet developed that will allow farmers to profit from harvesting some of their stubble for ethanol production.

    ISU researcher Stuart Birrell and others have been experimenting with techniques that would allow farmers to reap and bale corn stubble simultaneously while harvesting corn.

    That could lower costs significantly, Birrell said. "Every time you put another machine in the field, your costs really start going up."

    Even with a one-pass system, Birrell said, the cost of harvesting would be greater than the $35 sought by the Energy Department. And there are other drawbacks. One-pass harvest experiments have slowed combines to about 60 percent of normal harvest speed, too slow to suit farmers, Birrell said.

    "Our target is 80 percent of harvest speed," Birrell said. "We feel farmers would live with that."

    Researchers are also studying how much of the corn plant can be removed without causing soil erosion and loss of soil nutrients.

    There are advantages to leaving stubble in the field, Birrell said. "The bottom part is fairly high in nutrients."

    Many of the questions surrounding cellulosic ethanol could be answered in the next 10 years as six pilot plants are built with the help of $385 million in grants from the Energy Department.

    Some of those refineries will experiment with corn stover and other crop residues. Others will experiment with woody materials, others with switchgrass and others with municipal waste.

    Right now, the cost of producing ethanol from corn stover is about twice the cost of producing ethanol from corn kernels.

    "It cannot compete without subsidies," said Sam Tagore, a Department of Energy feedstocks specialist in Washington, D.C.

    Not the least of the concerns with corn stover is the problem of storage, Tagore said. The harvest of corn stover would occur during a six-week harvest window in the fall, but the ethanol plant would require regular deliveries throughout the year.

    Even a small ethanol plant using 2,000 tons of stover a day would require 100 acres stacked 25 feet high with stover to run a refinery for a year.

    A three-year study in Chase County indicates that an 80-million-gallon ethanol plant would require corn stover from 500,000 acres of corn within a 50-mile radius of the plant and 500 acres to store it after harvest.

    "That will give you an idea of the logistical nightmare this thing is," said Lex Thompson, one of the Chase County coordinators.

    On the other hand, an additional $30 profit per acre would put $15 million into the pockets of farmers operating near the refinery.

    The question, Thompson said, is whether such a scenario is feasible.

    "We're at the stage now where we are going to know the answer in a few years," he said.

    Imperial farmer Johnson, although still not sure what the future will hold, said there is potential for success.

    "We believe there will need to be a return (profit) of $30 an acre for a farmer to want to participate," Johnson said.

    That is the key, said Hettenhaus, the biomass consultant. "I compare farmers to the OPEC guys. They control the feedstocks. Unless it is a benefit to the farmer, forget it."

    Pilot projects

    These are the six pilot projects awarded $385 million in grants by the Department of Energy to construct biomass ethanol plants:

  • Emmetsburg, Iowa - ($80 million). Broin Companies of Sioux Falls, S.D. Using 842 tons per day of corn fiber, cobs and stalks.

  • Soperton, Ga. - ($76 million). Range Fuels of Broomfield, Colo. Using 1,200 tons a day of wood residues and wood-based energy crops.

  • Shelley, Idaho - ($80 million). Iogen Biorefinery Partners of Arlington, Va. Using 700 tons a day of wheat straw, barley straw, corn stover, switchgrass and rice straw.

  • Southern California - ($40 million). BlueFire Ethanol of Irvine, Calif. Using 700 tons per day of sorted green waste and wood waste from landfills.

  • Kansas (site undetermined) - ($76 million). Abengoa Bioenergy Biomass of Missouri. Using 700 tons a day of corn stover, wheat straw, milo stubble and switchgrass.

  • Hendry County, Fla. - ($33 million). ALICO Inc. Using 770 tons per day of yard, wood and vegetative wastes.

  • Clearly, challenges remain to the commercialization of cellulosic ethanol, both in the fields and in the production facilities. It may be some time before someone finds a production model that works, from logistical, technological and economical standpoints.

    I'm encouraged though by the number of pilot projects moving forward and the fact that each seems to be using a different set of feedstocks. I think this is important at this stage, as each feedstock will present different logistical and technological challenges and some may emerge first as more feasible feedstocks in the near term.

    If we can find a few feedstocks that pencil out and work, they will give us the opportunity to work out technical and economic kinks on the production side while we continue to work on collection and transport methods that will make other feedstocks viable in the longer term.

    Check out Robert Rapier's posts on the challenges facing cellulosic ethanol development over at the R-Squared Blog. I am personally more optimistic that these challenges will be solved, but Robert presents a good analysis of the hurdles still standing in the way of commercial cellulosic ethanol production. See posts here and here.

    The industry still has a lot of work to do to become commercially viable. If it can, the potential is tremendous.

    Cellulosic ethanol and plug-in hybrids together can likely replace all of our gasoline and diesel use for light duty transport (with ethanol providing the liquid fuel for plug-ins for about 1/3 of vehicle miles traveled, with the remainder running on electricity from the grid) while slashing our greenhouse gas emissions from transport.

    This is my personal favorite for the future of transportation, and I hope that the logistical, technological and economic hurdles standing in the way of this future can be solved (and soon!).

    [A hat tip to Robert Rapier of R-Squared Blog]

    Wednesday, March 21, 2007

    Bush Administration Proposes Alternative Fuel Standard Act - Gov. Schwarzenegger Encourages Different Approach

    [From Green Car Congress:]

    Energy Secretary Samuel Bodman and EPA Administrator Stephen Johnson sent a joint proposal letter to the chairman and ranking member of the House Committee on Energy and Commerce Monday proposing draft legislation requiring 35 billion gallons of alternative motor fuel—15% of projected gasoline use—by 2017.

    The new standard would require US ethanol and alternative fuel consumption to reach 10 billion gallons in 2010. Alternative fuel use would then slowly rise through 2014, and ramp up the following three years to reach 35 billion gallons annually in 2017.

    The new Alternative Fuel Standard Act, one of the initiatives highlighted by President Bush in his State of the Union address this year (earlier post), would supplant the existing Renewable Fuel Standard component of the Energy Policy Act of 2005. That goal was for 7.5 billion gallons of alternative fuel by 2012.

    The Alternative Fuel Standard Act also calls for a credit, banking and trading program that will encourage production of alternative fuels and reduce price volatility.

    The legislation, according to Bodman and Johnson, will help meet the goal of reducing gasoline consumption by 20% in 10 years. The remaining 5 percent reduction is expected to come from revisions to the Corporate Average Fuel Economy (CAFE) standards.

    In a reaction to the submission of the legislation, California Governor Arnold Schwarzenegger, who has ordered a Low Carbon Fuel Standard for the state of California (earlier post"), cautioned against a policy prescription that (a) specifies a technology outcome and (b) doesn’t address greenhouse gas emissions.
    "While I applaud President Bush’s commitment to increase the production and use of alternative fuels, effective energy policy requires a long-sighted plan that combats global warming, encourages market-based economic growth and reduces our country’s dependence on oil.

    By favoring one technology over another, the Alternative Fuel Standard Act allows government rather than markets and consumers to determine the alternative fuel winners and losers. And by not capping emissions, it potentially enables more global warming since some alternative fuels may produce more greenhouse gas emissions than current fuels.

    California has been a global leader on this issue with passage of our Global Warming Solutions Act and the establishment of the Low Carbon Fuel Standard. I encourage President Bush and Congress to pass aggressive legislation that addresses this country’s energy needs realistically and comprehensively."
    —Governor Schwarzenegger

    I tend to agree with the Governator here. We don't need any more of a focus on corn-based ethanol which does very little to achieve the dual policy goals of reduced oil dependence and reduced global warming pollution.

    I also agree that it makes little sense to promote an RFS with no attention paid to the well-to-wheels fossil energy input and greenhouse gas emissions intensity of the biofuels.

    It would make much more sense to couple a low-carbon fuels standard with policies focused on increasing vehicle fuel economy (fee-bates/gas guzzler taxes and CAFE reform) than to adopt an RFS if our goal is to reduce oil consumption, mitigate climate change, or both.

    [Image Credit: GE Fanuc Automation]

    Canada Introduces 'Fee-bates' and Other Measures to Encourage Fuel-Efficient Vehicle Purchases

    [From Green Car Congress:]

    The Canadian government is introducing several new measures designed to encourage consumers to purchase or lease fuel-efficient vehicles and get older vehicles off the road.

    The measures in Budget 2007 include up to C$2,000 in rebates for the purchase or long-term lease of a fuel-efficient vehicle; up to C$4,000 in a gas-guzzler tax; C$6 million over two years for a seven-fold increase for vehicle scrappage programs; and C$30 million over two years to remove older vehicles from Canadian roads.

    In addition to the initiatives above, the government will also invest C$33 billion in transportation infrastructure, including public transit, and C$2 billion over the next seven years for the production of renewable fuels.

    Rebates. Transport Canada establishes and manages the list of vehicles available for rebates. The list currently includes new cars getting 6.5 l/100km (36 mpg US) or better and new light trucks getting 8.3 l/100km (28.3 mpg US) or better. In addition, new flexible-fuel vehicles with combined fuel consumption E85 ratings of 13.0 l/100km (18 mpg US) or better will be eligible.

    Green Levy—the gas-guzzler tax. Manufacturers or importers will have to pay a Green Levy on new passenger vehicles (excluding trucks) with fuel consumption of 13.0 l/100 km combined (18 mpg US) or more. The tax will start at C$1,000 for passenger vehicles with combined fuel consumption ratings of at least 13.0 l/100 km but less than 14.0 l/100 km. The rate will increase in $1,000 increments for each full liter per 100 km increase in the combined fuel-efficiency rating above the 13.0 l/100 km floor, to a maximum of C$4,000. With the introduction of the new levy, the existing excise tax on heavy vehicles will be eliminated effective 20 March 2007.

    Fuels. The Canadian government recently announced a minimum 5% average renewable content requirement in Canadian gasoline by 2010. The government also intends to develop a regulation for diesel fuel and heating oil to contain 2% average renewable content by 2012.

    More than 2 billion liters of renewable fuels will be needed to meet those targets. Budget 2007 invests up to C$2 billion in support of renewable fuel production in Canada to help meet these requirements, including up to C$1.5 billion for an operating incentive and $500 million for next-generation renewable fuels.

    Up to C$1.5 billion over seven years will be allocated towards an operating incentive to producers of renewable alternatives to gasoline, such as ethanol, and renewable alternatives to diesel, such as biodiesel, under conditions where industry requires support to remain profitable.

    Incentive rates will be up to $0.10/liter for renewable alternatives to gasoline and up to $0.20/liter for renewable alternatives to diesel for the first three years, then decline thereafter.

    The government will not provide support when a company’s rate of return exceeds 20% annually. Support to individual companies will be capped to ensure that benefits are provided to a wide range of participants in the sector, not just the largest oil-producing companies.

    Budget 2007 also makes C$500 million over seven years available to Sustainable Development Technology Canada to invest with the private sector in establishing large-scale facilities for the production of next-generation renewable fuels such as cellulosic ethanol.

    Other measures in Budget 2007 include a focus on reducing federal fleet greenhouse gas emissions, and a phasing out of tax breaks for oil sands production.

    Federal fleet greenhouse gas reductions. The government is also targeting a 15% reduction in greenhouse gas emissions per vehicle-kilometer in its 26,000-vehicle fleet from 2002-03 levels.

    Federal departments now have about 1,400 alternative fuel and hybrid vehicles in use, and vehicles purchased for the federal fleet must be capable of operating on alternative fuels, where cost-effective and operationally feasible. In addition, where it is available, all gasoline purchased for federal road vehicles must be ethanol-blended.

    Oil sands tax break. The government intends to phase out a tax break for oil sands producers that allows them to write off investment costs, setting a final deadline of 2015 for the changes.

    Accelerated capital cost allowance (ACCA) is sometimes used to promote investment in certain emerging industries and in clean energy technologies that have broad social benefits in terms of reduced environmental impacts. By accelerating the timing of capital cost deductions, ACCA defers taxation and improves the financial return from investments in particular assets.

    Canada provided ACCA for investments in the oil sands at a time when it was an emerging sector and special support was appropriate to help offset some of the risk associated with early investments. Given the current health of the oil sands sector, the government decided that ACCA is no longer required. Budget 2007 phases out the existing ACCA for assets in this sector, leaving in place the regular 25% CCA rate for these assets.

    The existing ACCA that encourages industries to invest in equipment that generates energy more efficiently or by using renewable energy sources will be extended to equipment acquired before 2020. It will also be expanded to cover wave and tidal energy, and additional solar energy and waste-to-energy technologies.

    This looks like a smart package of policies. It's good to see the Harper government getting serious about climate change, renewable energy and energy efficiency. Things didn't look good when Harper took power last year (see previous post), but he seems to have taken a new look at energy and climate change policies.

    The 'fee-bates' system on vehicles is a very smart policy. If designed correctly, a fee-bate policy can be largely revenue neutral and can effectively incentivize the purchase of more efficient vehicles. As fleet fuel economy improves, the list of vehicles qualifying for rebates or fees can be updated so to continually incent the improvement of fleet fuel economy.

    This would be a very smart policy to enact in the United States, and in conjunction with improved and reformed CAFE standards designed to ensure manufacturers offer the fuel efficient vehicles in the first place, could help push forward the efficiency of the United States light vehicle fleet for the first time in nearly 30 years.

    Unfortunately, the fee part of the fee-bates policy looks too much like a tax to some American lawmakers and hasn't had much traction in the U.S. It would probably take some delicate spin to get a fee-bate system passed in the United States.

    At least Canada is providing a good example for us here (China has a similar gas-guzzler fee and incentives for efficient vehicles, I believe, and I'm sure other countries do as well).

    [Image credit:]

    Tuesday, March 20, 2007

    Capital to the Capitol: Investors Managing $4 Trillion Call on Congress to Tackle Climate Change

    Coalition of 65 Investors and Businesses Touts Competitive Benefits of Strong Federal Legislation; Includes Call for 60-90 Percent Greenhouse Gas Reductions

    [From a Ceres Press Release:]

    For the first time, dozens of institutional investors managing $4 trillion in assets today called on US lawmakers to enact strong federal legislation to curb the pollution causing global climate change.

    Joined by a dozen leading US companies, the investor group outlined the business and economic rationale for climate action as they called for a national policy that reduces greenhouse gas emissions consistent with targets scientists say are needed to avoid the dangerous impacts of global warming.

    The group, organized by Ceres and the Investor Network on Climate Risk, issued a Climate Call to Action at a press conference today in Washington DC. The 65 signers include institutional investors and asset managers such as Merrill Lynch, and the California Public Employees Retirement System (CalPERS), as well as leading corporations such as BP America, Allianz, PG&E, DuPont, Alcoa, Sun Microsystems and National Grid.

    In endorsing the statement, investors and companies sent a strong message that climate policy uncertainty and the lack of federal regulations may be undermining their long-term competitiveness because it is preventing them from investing in clean energy and climate-friendly technologies and practices.

    "Global warming presents enormous risks and opportunities for US businesses and investors,” said Fred R. Buenrostro, chief executive officer at CalPERS, the country’s largest public pension fund with $230 billion in assets. "To tap American ingenuity and drive business to a leadership position in the low-carbon future, we need regulations to enable the markets to deploy capital and spur innovation.”

    “Investors and companies are asking Washington to set a clear policy direction to address the risks of climate change,” said Ceres president Mindy S. Lubber, whose organization also directs the Investor Network on Climate Risk. “The greatest climate risk facing investors and business is the uncertainty caused by the absence of U.S. policy.”

    Climate change presents far-reaching risks and opportunities for businesses and investors. Some companies in sectors such as electric power, oil and automotive will face high financial risks from carbon-reducing regulations if they are not prepared to act. Insurance companies and businesses with infrastructure in places vulnerable to extreme weather events also face financial exposure. On the flip side, climate change presents significant economic opportunities for businesses that invest in new technologies and products to save energy and reduce greenhouse gas emissions.

    Citing these trends – as well as recent scientific reports concluding that climate change is taking place and that human activities are the primary contributor – investors and companies called for the following three actions:

  • Leadership by the US government to achieve sizable, sensible long-term reductions of greenhouse gas (GHG) emissions in accordance with the 60-90% reductions below 1990 levels by 2050 that scientists and climate models suggest is urgently needed to avoid worst case scenarios. Wherever possible, the national policy should include mandatory market-based solutions, such as a cap-and-trade system, that establish an economy-wide carbon price, allow for flexibility and encourage innovation.

  • A realignment of national energy and transportation policies to stimulate research, development and deployment of new and existing clean technologies at the scale necessary to achieve GHG reduction goals.

  • The Securities and Exchange Commission (SEC) to clarify what companies should disclose to investors on climate change in their regular financial reporting.

  • “As institutional investors focused on the long-term financial performance of a company, we expect a thorough analysis of all significant business liabilities,” said Connecticut State Treasurer Denise L. Nappier. “Leading companies have already made progress working to not only assess and report the risks posed by climate change, but to also set in place strategic plans to foster future growth and success. In the face of mounting evidence demonstrating the economic implications of climate change, we strongly urge the SEC to acknowledge it as a material consideration and require all companies to disclose its impact to shareholders.”

    “Allianz SE believes it is essential to put a price tag on carbon, thereby enabling market mechanisms to drive emissions reductions and climate protection,” said Joachim Faber, member of the Board of Management at Allianz SE, which manages $1.6 trillion of assets. “Despite challenges in the application of the European carbon emissions trading system, we firmly believe that appropriately structured carbon cap and trade programs play a central role in addressing the challenge of global climate change.”

    “The lack of a national climate policy is hindering the business community’s ability to respond,” said Jack Ehnes, chief executive officer of the California State Teachers Retirement System (CalSTRS). “In addition to providing a clear regulatory roadmap, Congress needs to realign energy and transportation policies to stimulate new technologies that will enable us to achieve dramatic greenhouse gas reductions.”

    “The investor and the business community are demonstrating that they are ahead of the political process. Like most responsible observers, they’ve seen the science, know it is real and must be responded to,” said Timothy E. Wirth, president of the United Nations Foundation. “Through their actions, they are demonstrating that preventing climate change isn’t just good for the planet; it is an opportunity to bolster the bottom line. Now it’s time for the policy makers to join this great global effort.”

    The entire statement and more information on the climate call to action can be found here.

    You can watch video of the press conference here

    [A hat tip to Green Car Congress. Image credit: The Info Pit]

    Friday, March 16, 2007

    Warnings From a Warming World: Study Finds Global Warming Causing Decline in Global Crop Production

    [From Green Car Congress:]

    Over a span of two decades, warming temperatures have caused annual losses of roughly $5 billion for major food crops, according to a new study by researchers at the Carnegie Institution and Lawrence Livermore National Laboratory.

    From 1981-2002, warming reduced the combined production of wheat, corn, and barley by 40 million metric tons per year, according to the analysis published today in the online journal Environmental Research Letters.

    [Image: The solid line shows the mean estimate of climate effect on yield trends from 1981 to the year shown on the x axis. Dotted lines indicate 95% confidence interval. (Click to enlarge)]
    The results suggest that recent climate trends, attributable to human activity, have had a discernible negative impact on global production of several major crops. The impact of warming was likely offset to some extent by fertilization effects of increased CO2 levels, although the magnitude of these effects are uncertain and the subject of much debate.

    If each additional ppm of CO2 results in ~ 0.1% yield increase for C3 crops (a yield increase of 17% for a concentration increase from the current 380 ppm to the frequently studied 550 ppm), then the ~ 35 ppm increase since 1981 corresponds to a roughly 3.5% yield increase, about the same as the 3% decrease in wheat yield due to climate trends over this period.

    Thus, the effects of CO2 and climate trends have likely largely cancelled each other over the past two decades, with a small net effect on yields. This conclusion, while tempered by the substantial uncertainty in yield response to CO2, challenges model assessments that suggest global CO2 benefits will exceed temperature related losses up to ~ 2° warming.
    The study is the first to estimate how much global food production has already been affected by climate change. Christopher Field and David Lobell compared yield figures from the Food and Agriculture Organization with average temperatures and precipitation in the major growing regions.

    They found that, on average, global yields for several of the crops responded negatively to warmer temperatures, with yields dropping by about 3-5% for every 1° F increase. Average global temperatures increased by about 0.7° F during the study period, with even larger changes in several regions.

    "Though the impacts are relatively small compared to the technological yield gains over the same period, the results demonstrate that negative impacts are already occurring," said study author, David Lobell.

    The researchers focused on the six most widely grown crops in the world: wheat, rice, maize (corn), soybeans, barley and sorghum—a genus of about 30 species of grass raised for grain. These crops occupy more than 40% of the world’s cropland, and account for at least 55% of non-meat calories consumed by humans. They also contribute more than 70% of the world’s animal feed.

    The main value of this study, the authors said, was that it demonstrates a clear and simple correlation between temperature increases and crop yields at the global scale.

    The Carnegie Institution of Washington has been a private nonprofit research organization since 1902. It has six research departments: the Geophysical Laboratory and the Department of Terrestrial Magnetism, both located in Washington, DC; The Observatories, in Pasadena, California, and Chile; the Department of Plant Biology and the Department of Global Ecology, in Stanford, California; and the Department of Embryology, in Baltimore, Maryland.

    This study indicates that the potentially positive affect of increased atmospheric concentrations of CO2 on crop yields will largely be offset by decreased yields resulting from increasing temperatures. If this study's findings are correct, then one of the few bits of 'good news' concerning global warming - potentially increased crop yields - is largely overstated.

    Crop yields will also likely be impacted as climatic zones suitable for agriculture - the traditional bread baskets of the world - shift to lower latitudes, necessitating a gradual relocation of farming activities. Increased and more severe summer droughts, also a likely affect of global warming, will further take it's toll on agricultural activities.

    These two likely effects of climate change will disproportionately impact those in poorer developing countries who lack the resources needed to cope with shifting climate zones and increased drought (and desertification) - i.e. increased water storage and irrigation and the relocation of farms to more productive climatic zones.

    All-in-all, despite some potential increases in crop yields driven by higher atmospheric concentrations of CO2, global warming looks like bad news for the world's agricultural operations.


    Global scale climate–crop yield relationships and the impacts of recent warming”; David B Lobell and Christopher B Field; Environ. Res. Lett. 2 014002 (7pp) doi:10.1088/1748-9326/2/1/014002

    Wednesday, March 14, 2007

    EU Adopts Firm Goals - 20% of Energy from Renewables and 20% Reduction in Greenhouse Gas Emissions by 2020

    Goals must now be adopted in legal framework by member nations

    [From Renewable Energy]

    Energy policy and climate protection topped the agenda at the Spring European Council in Brussels last week where European Union (EU) heads of state and government officials committed to set a binding target for 20% of the EU's total energy supply to come from renewables by 2020.

    Currently only 6.5% of the EU's energy is sourced from renewables.

    The EU, already a leader in renewable energy technology commanding 60% of the world's wind power market, also set a binding minimum target of 10% for the share of biofuels in overall transport petrol and diesel consumption by 2020. According to Angela Merkel, German Chancellor and president of the EU Council, the goals are ambitious and credible.

    "Adopting an energy action plan will give the initial spark for a third technological revolution. We'll be going down completely new roads as far as technology and innovation are concerned," said Merkel, adding the targets steps will put the EU in a position to make it clear to the international community that Europe is playing a pioneering role.

    In addition, the 27 Member States that make up the EU set a firm target of cutting 20% of the EU's greenhouse gas emissions by 2020 as part of the post-Kyoto arrangements. Furthermore, the heads of state said the EU will be willing to raise the goal up to 30% if other countries, including the U.S., China and India, made commitments in the same direction.

    "European leaders have provided a powerful response to the looming climate and energy crisis, and the call from European citizens for more renewable energy. With today's decision, followed by effective implementation in the near future, Europe now has a real opportunity to change its energy supply structure towards a much larger share of indigenous, renewable resources, reduced import dependence and less exposure to unpredictable fuel prices," said Christian Kjaer, CEO of EWEA, after the Spring Summit ended on Friday.

    A suitable legal framework now needs to be rapidly adopted in order to reach the 20% target, along with clear guidelines to market participants for the future direction of renewable electricity in Europe.

    The EU appears to be doing their part to reduce the threat of global warming. But they can't do it alone! It is absolutely crucial that the United States joins the EU in setting similar reduction goals (20% by 2020 or 25% by 2025) that put us on the path towards an ultimate reduction of 80% or more by 2050.

    The EU leaders were smart to say that they would be willing to adopt more aggressive reduction targets if other nations, such as the United States, China and India, adopt similar targets. Rather than do nothing while they wait for other nations to act - as the United States has done under the Bush Administration's leadership, citing the fact that developing nations like China and India are not included in the Kyoto Protocol as reason enough not to do anything to reduce our own emissions - the EU has taken an alternative path, setting out to reduce it's emissions a reasonable amount while publicly stating that they are willing to go further if they do not have to go it alone.

    A reasonable policy, and I hope that it provides further pressure on Congress to take action on climate change (although I'm skeptical how much affect the actions of the EU have on U.S. Senators and Representatives). I'm glad that the EU has continued to lead by example in the face of inexcusable inaction from the United States. 'Leaders of the free world' we certainly are not ... at least when it comes to tackling climate change.

    [Image source: University of Twente (the Netherlands)]

    Thursday, March 08, 2007

    Bank of America commits $20 billion to renewable energy developments

    Bank of America Corp. has introduced a $20 billion, 10-year initiative that encourages the development of environmentally sustainable business practices through lending, investing, philanthropy, and the creation of new products and services.

    "Today, we have a tremendous opportunity to support our customers' efforts to build an environmentally sustainable economy - through innovative home and office construction, new manufacturing technology, changes in transportation and new ways to supply our energy," says Kenneth D. Lewis, Bank of America's chairman and chief executive officer.

    According to the company, it will commit $18 billion in lending, advice and market creation to help commercial clients finance the use and production of new products, services and technologies. In addition, the bank will commit $1.4 billion to achieve Leadership in Energy and Environmental Design certification in all new construction of office facilities and banking centers; donate $50 million to support nonprofit organizations focused on forest preservation, innovative energy conservation, developing green affordable housing and other environmentally progressive activities; and invest $100 million in energy conservation measures for use in all company facilities.

    Bank of America says it is currently developing a set of products for individuals who want to offset or minimize their carbon emissions.

    A mini waterwheel can light up your home

    A number of Cleanergy members are ready to buy this. Distributors requests welcome !

    A Scottish electrician, Ian Gilmartin, has come up with a new invention that could help reduce your energy bills significantly.

    Gilmartin, 60, skillfully abetted by his friend Bob Catley, 58, both from Kendal, Cumbria have invented a mini waterwheel capable of supplying enough electricity to power a house for free. The apparatus is designed to work in small streams and rivers – ideal for more than 50,000 British homes.

    The mini waterwheel produces one to two kilowatts of power and generates 24 kilowatt hours of sustainable green energy in a day, just a notch below the daily consumption of an average household – 28 kilowatt hours. It is the first off- the-shelf waterwheel that can generate a decent supply of electricity; even from water falls as little as 20cm.

    Surprisingly, the driving force behind Gilmartin’s invention was not high energy bills. In fact, he has never lived in a house with electricity. But he does have a stream at the back of his house, the Beck Mickle. Owing to his creative prowess and with help from his friend Bob, he now hopes to see his prototype in the shops by the end of next year.

    Gilmartin’s waterwheel will cost around £2,000 for full installation. Though this might seem rather overwhelming at the outset, the system will pay for itself within two years.

    Gilmartin was noted as saying: “While we cannot say this provides free electricity, because of the initial cost of buying the machine, it is expected to pay for itself within two years and then greatly reduce the owner’s electricity bills after then.”

    Clean energy market will reach $230 billion in 10 years

    Revenues from clean energy will grow to $226.5 billion in the next decade, up from $55.4 billion last year, according to Clean Edge.

    In its annual report on clean energy, the US-based cleantech consultancy said that the market for biofuels, wind power, solar photovoltaics (PV), fuel cells and hydrogen grew 39% in the last year, and is expected to quadruple by 2016.

    Much of this growth will come from the biofuels sector, which it expects to expand from a $20.5 billion business in 2006 to an $80.9 billion a year business in 2016.

    Solar power revenues are also set to grow to $69.3 billion from $15.6 billion over the same period, with wind expanding more slowly from $17.9 billion to $60.8 billion. Revenues from fuel cells will also rise from $1.4 billion in 2006 to $15.6 billion in 2016, the report projects.

    Ron Pernick, a principle at Clean Edge, said that one of the factors behind last year's growth was the growing acceptance of the science of climate change. "The most ardent nay-sayers began to change their tune," he said.

    And Wal-Mart is likely to be a driving force behind future expansion, the report says, along with other factors including the push for a cap-and-trade scheme to control greenhouse gas emissions in the US.

    The retail behemoth is planning a major drive to improve its own energy efficiency and install renewable generation in its stores, which is likely to result in huge orders for technology. "Could Wal-Mart do for renewables what it already has done for everything from laptops to lingerie: make them affordable by the masses?" the report asks.

    Meanwhile, Clean Edge says, US venture capital investment in energy technology has tripled from $917 million in 2005 to $2.4 billion in 2006, while the percentage of total VC investment being put into energy has risen from 4.2% to 9.4% during the year.

    Clean Edge also identifies an unusual trend, with venture capitalists now willing to plough more money into less risky investments which involve building production lines for PV, ethanol and biodiesel. "Investors looked to basically build refineries with VC dollars," said Rodrigo Prudencio, a partner at cleantech venture capital firm Nth Power, raising the prospect that investor returns may not be as high as usual in the sector.

    Wednesday, March 07, 2007

    New Mexico Governor Signs Expanded Renewable Energy Standard

    New Mexico Joins Growing List of States Expanding Successful Renewable Energy Standards

    On Monday, Governor Bill Richardson signed into law Senate Bill 418, which will dramatically increase New Mexico's existing Renewable Energy Standard and put New Mexico at the forefront of states committed to clean energy.

    “I am proud today to sign a bill that will quadruple New Mexico’s use of clean electricity by 2020,” said Governor Bill Richardson said in a press release monday. “Promoting renewable electricity keeps our air clean and it will help New Mexico meet my aggressive greenhouse gas reduction goals. It will also help continue to create new jobs, like those at Advent Solar in Albuquerque, and aid ranchers who want to diversify into the lucrative wind energy market.”

    In 2004 Governor Richardson signed New Mexico’s first Renewable Energy Standard into law. This law, also known as a Renewable Portfolio Standard, mandated that 5% of New Mexico’s electricity come from renewable sources by 2006, increasing to 10% by 2011. Senator Michael Sanchez’s Senate Bill 418 requires that at least 15 percent of an electric utility's power supply come from renewable sources by 2015 and 20 percent by 2020.

    The original 2004 Renewable Energy Standard (RES) only applied to New Mexico's investor-owned utilities. The new expanded RES includes the states public utility district's and municipal and rural electric cooperatives, setting a smaller standard of 5% by 2015 and 10% by 2020 for these consumer-owned utilities.

    The bill passed the Senate unanimously (32-0) and the House by a broad bipartisan vote of 43 to 18.

    New Mexico joins several other states who have recently expanded their existing succesful Renewable Energy Standards including California, Arizona, and Minnesota.

    Colorado is also set to join the list. The Colorado House passed a bill last week that will double the Renewable Energy Standard adopted by Colorado voters in 2004 to 20% by 2020 as well.

    Governor Richardson also signed House Bill 188 on Monday. The bill creates a Renewable Energy Transmission Authority to promote clean energy jobs and help New Mexico both develop our clean energy resources and market them to other states.

    “The Transmission Authority and the Renewable Portfolio Standard work in combination to dramatically position New Mexico to develop our vast renewable energy resources,” said Joanna Prukop Cabinet Secretary for Energy, Minerals, and Natural Resources. “We've just positioned our state to become extremely competitive in all aspects of clean energy development and the benefits that come with it.”

    In the past few weeks Governor Richardson has also signed a major, five state climate change agreement, announced a new Tesla electric car plant for Albuquerque and a biodiesel plant in Clovis, NM.

    “I am proud that both these bills passed with bipartisan support,” said Governor Richardson. “That is because New Mexico is hungry for clean energy and the good jobs that come with this new industry.”

    PG&E to Explore Wave Power in Northern California

    [From Green Car Congress:]

    Pacific Gas and Electric Company took the first step towards developing generation projects that could convert the abundant wave energy off the coast of Mendocino and Humboldt Counties (California) into electricity by filing two preliminary permit applications with the Federal Energy Regulatory Commission (FERC).

    The WaveConnect projects will begin with resource, environmental, and ocean use studies and if developed would use wave energy conversion (WEC) devices to transform the energy of ocean waves into clean, renewable electricity. If fully developed, the projects could each provide up to 40 MW of clean renewable electric supply.

    [Graphic: Maximum wave energy potential along the Northern California coast is not quite as strong as Oregon sites being explored for wave power. However, wave strength is more constant at Northern California sites and average wave power potential may be better than in Oregon.]

    This would be the first application in North America for a project that would allow multiple WEC device manufacturers to demonstrate their devices on a common site, which could help accelerate the development of wave energy technology.

    Most of the WEC devices currently being considered by PG&E float on the ocean surface and generate electricity when waves are present. PG&E, as the lead developer, will be responsible for the permitting of the sites and will encourage the participation of multiple WEC device manufacturers in the projects.

    Phased development of the sites would proceed if technical results support feasibility, environmental studies show that any significant impacts can be fully mitigated, and stakeholder considerations can be satisfactorily addressed.

    Working closely with stakeholders, PG&E will take a leading role in identifying and mitigating any potential impacts to the marine environment in order to maintain the beauty and diversity of coastal waters. PG&E, working with environmental agencies and consultants, will undertake studies of the water resource and its various ecosystems. The project will be designed to minimize effects on the environment, coastal processes, and ocean users.

    Eye On China: China Set to Pass U.S. as Largest Emitter of Global Warming Pollution

    [From the San Francisco Chronicle:]

    Far more than previously acknowledged, the battle against global warming will be won or lost in China, even more so than in the West, new data show.

    A report released last week by Beijing authorities indicated that as its economy continues to expand at a red-hot pace, China is highly likely to overtake the United States this year or in 2008 as the world's largest emitter of greenhouse gases.

    This information, along with data from the International Energy Agency, the Paris-based alliance of oil importing nations, also revealed that China's greenhouse gas emissions have recently been growing by a total amount much greater than that of all industrialized nations put together.

    "The magnitude of what's happening in China threatens to wipe out what's happening internationally," said David Fridley, leader of the China Energy Group at Lawrence Berkeley National Laboratory.

    "Today's global warming problem has been caused mainly by us in the West, with the cumulative (carbon dioxide and other greenhouse gases) in the atmosphere, but China is contributing to the global warming problem of tomorrow."

    New statistics released in Beijing on Wednesday by China's National Bureau of Statistics show that China's consumption of fossil fuels rose in 2006 by 9.3 percent, about the same rate as in previous years -- and about eight times higher than the U.S. increase of 1.2 percent.

    While China's total greenhouse gas emissions were only 42 percent of the U.S. level in 2001, they had soared to an estimated 97 percent of the American level by 2006.

    "The new data are not encouraging," said Yang Fuqiang, China director for the Energy Foundation, a San Francisco organization that works extensively with Lawrence Berkeley scientists and the Chinese government on energy-saving programs. "China will overtake the United States much faster than expected as the No. 1 emitter."

    China's top environmental official admitted Wednesday that the results show the government's environment agenda of the past few years has been ineffective.

    "Economic growth is still excessive ... and there is slow progress in restructuring obsolete and backward production capacity," said Zhou Shengxian, director of the State Environmental Protection Agency.

    "The new data show that many local officials are more concerned about economic development, about increasing gross domestic product, and see energy efficiency and environmental protection as a lower priority," said Yang, of the Energy Foundation.

    In an attempt to force local governments to obey energy-efficiency edicts from Beijing, the government recently announced that local officials' pay and promotion will be judged in part based on their environmental record, not just their economic success. The first evaluation period will be in July.

    China's emergence as a global warming polluter has been intensely controversial in international negotiations over climate change.

    The Bush administration refused to join the Kyoto Protocol in part because the pact committed only industrialized nations, but not fast-growing poorer nations like China, to reduce their emissions of greenhouse gases.

    Chinese officials, however, note that the country's per capita emissions are far below those in the West, and they say any move to adopt mandatory cuts now would restrain its economic growth and in effect penalize its 1.3 billion people for being poor. The officials say China must be given the chance to attain the West's standard of prosperity before it will cut emissions.

    "It must be pointed out that climate change has been caused by the long-term historic emissions of developed countries and their high per-capita emissions," China's Foreign Ministry spokeswoman, Jiang Yu, said last month.

    "Developed countries bear an unshirkable responsibility," she said, adding that they should "lead the way in assuming responsibility for emissions cuts."

    International negotiations have begun over a successor pact to the Kyoto Protocol, and industrial nations -- and most environmentalists -- are insisting that big developing nations such as China, India and Brazil commit to reductions.

    China's hard line may finally be softening, however.

    The Chinese government recently admitted that global warming will dramatically impact China's ability to feed its people. A government report released in January said that climate change will cause China's production of wheat, corn and rice to drop by as much as 37 percent over the next 50 years.

    Precipitation over the country's northern grainbelt is expected to drop markedly, causing worsened droughts and dust storms, while increased flooding and typhoons are expected in the subtropical south, the report said.

    What China needs, many experts say, is help from the United States and other Western nations to help adopt energy-saving technologies. China's energy consumption per unit of production is 40 percent higher than the world's average, and about 70 percent of its energy comes from coal, usually burned in highly inefficient power plants.

    The U.S. Energy Department carries out some technical cooperation with China on issues such as coal, but most forms of U.S. assistance to China have been barred under sanctions imposed by Congress after the 1989 Tiananmen killings in Beijing.

    Although Chinese officials say their country should receive foreign grants and subsidies, the Central Bank has the world's highest foreign-exchange reserves, at $1.1 trillion, so most experts say China needs training and technology rather than cash.

    China has much to learn from California, said Barbara Finamore, director of the China program of the Natural Resources Defense Council.

    The state's Energy Commission and Public Utilities Commission have exchanged information with their counterparts in China in recent years, but Finamore said much more is needed to help spread California's energy-efficient ways.

    "This is what China is missing," Finamore said, referring to the state's complex mix of efficiency standards for buildings, appliances and industry. "We have no national energy-efficiency program, but 20 U.S. states use them, and China is on the brink of using them."

    This is scary news. We all knew this was coming, but estimates of when China would surpass the United States as the world's leading emitter of greenhouse gases had projected that we had a few more years.

    These new findings show how absolutely crucial it is that the United States figures out it's own greenhouse gas reduction plan as soon as possible. We need to lead by example and put ourselves on the path to emissions reductions of at least 80% by 2050. Our credibility in international negotiations is incredibly poor when we continue to take the "we'll cut our emissions when you cut yours" stance. As the world's richest nation, and the world's largest contributor to cumulative greenhouse gas levels in the atmosphere (a title we will regain much longer than the title of largest annual emitter of greenhouse gases), we must do our part to reduce our emissions. Only then will we have credibility when negotiating with China and other developing nations.

    Our success or failure in international negotiations to arrange a follow up to the Kyoto Protocol that includes some kind of standard for rapidly developing giants such as China, India and Brazil may very well determine our success or failure in stopping global warming.

    It's also crucial for the United States to cut it's emissions as soon as possible in order to 'make room' for increasing emissions from these developing countries, at least for the time being. We all share a global 'carbon budget', the cumulative amount of carbon and other greenhouse gases that we can afford to put into the atmosphere over the next century. The United States and other developed nations have already spent the last 100 years eating up part of the global carbon budget, and it is unjust for developed countries to tell developing countries such as China dn India that they must cut emissions at the same rate as developed countries.

    The Bush Administration's justification for not joining the Kyoto Protocol because it left out developing nations like China is completely absurd for all of the above reasons.

    It's time to stop dragging our heals on climate change. It's time to fulfill our own responsibilities and cut our carbon emissions by 80% by 2050. It's time to help developing nations such as China, India, Brazil, Mexico and Indonesia adopt energy efficient technologies and clean energy production technologies to reduce their carbon intensity as their economies grow. And it's time to lead the world forward towards stabilizing the climate.

    No less than the future of the world as we know hangs in the balance.

    Eye On China: China’s Private Auto Fleet Climbs to 29.25 Million

    [From Xinhua/People's Daily Online:]

    The number of China's privately owned sedans soared 33.5 percent year-on-year to 11.49 million at the end of 2006, according to the latest data released by the National Bureau of Statistics (NBS) Wednesday.

    The number of private automobiles reached 29.25 million at the end of 2006, up 23.7 percent over the end of 2005, the statistics show.

    The country sold more than seven million automobiles in 2006, including 3.8 million sedans, according to figures from the China Automobile Industry Association.

    The number of privately owned vehicles has been soaring since the country's accession to the World Trade Organization in 2001, when 43 percent of the country's civilian vehicles were privately owned.

    China, once known as the kingdom of bicycles, has overtaken Japan to become the world's second largest auto market after the United States.

    [Image source: Tegenstroom]

    New Bush Administration Report Predicts Steady Increase In U.S. Greenhouse Gas Emissions

    [From the New York Times:]

    The Bush administration estimates that emissions by the United States of gases that contribute to global warming will grow nearly as fast through the next decade as they did the previous decade, according to a long-delayed report being completed for the United Nations.

    The document, the United States Climate Action Report, emphasizes that the projections show progress toward a goal Mr. Bush laid out in a 2002 speech: that emissions of carbon dioxide and other greenhouse gases grow at a slower rate than the economy. Since that speech, he has repeated his commitment to lessening “greenhouse gas intensity” without imposing formal limits on the gases.

    [The Bush Administration plans to release new projections of greenhouse gas emissions through 2020. Click the graphic above to see how the administration's projects compare with three Senate bills announced earlier this year (see previous post)]

    Kristen A. Hellmer, a spokeswoman for the White House on environmental matters, said on Friday, “The Climate Action Report will show that the president’s portfolio of actions addressing climate change and his unparalleled financial commitments are working.”

    But when shown the report, an assortment of experts on climate trends and policy described the projected emissions as unacceptable given the rising evidence of risks from unabated global warming.

    “As governor of Texas and as a candidate, the president supported mandatory limits on carbon dioxide emissions,” said David W. Conover, who directed the administration’s Climate Change Technology Program until February 2006 and is now counsel to the National Commission on Energy Policy, a nonpartisan research group that supports limits on gases. “When he announced his voluntary greenhouse-gas intensity reduction goal in 2002, he said it would be re-evaluated in light of scientific developments. The science now clearly calls for a mandatory program that establishes a price for greenhouse-gas emissions.”

    According to the new report, the administration’s climate policy will result in emissions growing 11 percent in 2012 from 2002. In the previous decade, emissions grew at a rate of 11.6 percent, according to the Environmental Protection Agency.

    The report also contains sections describing growing risks to water supplies, coasts and ecosystems around the United States from the anticipated temperature and precipitation changes driven by the atmospheric buildup of carbon dioxide and other heat-trapping greenhouse gases.

    Drafts of the report were provided to The New York Times by a government employee at the request of a reporter. The employee did not say why this was done, but other officials involved with producing it said they have been frustrated with the slow pace of its preparation. It was due more than one year ago.

    The report arrives at a moment when advocates of controls are winning new support in statehouses and Congress, not to mention Hollywood, where former Vice President Al Gore’s cautionary documentary on the subject, “An Inconvenient Truth,” just won an Academy Award. Five western governors have just announced plans to create a program to cap and then trade carbon-dioxide emissions. And on Capitol Hill, half a dozen bills have been introduced to curb emissions, with more expected.

    Ms. Hellmer defended Mr. Bush’s climate policy, saying the president was committed to actions, like moderating gasoline use and researching alternative energy, that limited climate risks while also increasing the country’s energy and national security. She said Mr. Bush remained satisfied with voluntary measures to slow emissions.

    Myron Ebell, who directs climate and energy policy for the Competitive Enterprise Institute, a group aligned with industries fighting curbs on greenhouse gases, said Mr. Bush was right to acknowledge the inevitability of growing emissions in a country with a growing population and economy. Mr. Ebell added that the United States was doing better at slowing emissions than many countries that had joined the Kyoto Protocol, the first binding international treaty limiting such gases.

    “Since 1990, for every 1 percent increase in emissions the economy has grown about 3 percent,” Mr. Ebell said. “That’s good, and it’s better than the European Union’s performance.”

    Several environmental campaigners said there was no real distinction between Mr. Bush’s target and “business as usual,” adding that such mild steps were unacceptable given recent findings by the Intergovernmental Panel on Climate Change and other research groups tying recent warming more firmly than ever to smokestack and tailpipe gases.

    “If you set the hurdle one inch above the ground you can’t fail to clear it,” said David D. Doniger, the director of climate policy for the Natural Resources Defense Council, which has long criticized the administration and sought binding cuts in greenhouse gases.

    The report is the fourth in a series produced periodically by countries that are parties to the 1992 Framework Convention on Climate Change, a treaty signed by the first President Bush. It is a self-generated summary of climate-related trends and actions, including inventories of emissions of carbon dioxide and other greenhouse gases, research on impacts of climate change, and policies to limit climate risks and emissions.

    The last such report, completed in 2002, put the administration in something of a bind because it listed many harmful or costly projected impacts from human-caused warming. Environmental groups used those findings to press President Bush to seek mandatory caps on greenhouse gases, while foes of such restrictions criticized the findings and criticized the administration for letting them stay in the document.

    While that report was approved by senior White House and State Department officials, Mr. Bush quickly distanced himself from it, saying it was “put out by the bureaucracy.”

    The new report has been bogged down for nearly two years. In April 2005, the State Department published a notice in the Federal Register saying it would be released for public comment that summer.

    Several government officials and scientists involved with preparing or reviewing parts of the report said that the recent departures of several senior staff members running the administration’s climate research program delayed its completion and no replacements have been named. The delays in finishing the report come even as Mr. Bush has elevated global warming higher on his list of concerns. This year, for the first time since he took office in 2001, he touched on “global climate change” in the State of the Union Message, calling it a “serious challenge.”

    The draft report contains fresh projections of significant effects of human-caused warming on the environment and resources of the United States and emphasized the need to increase the country’s capacity to adapt to impending changes.

    Drought, particularly, will become a persistent threat, it said: “Warmer temperatures expected with increasing concentrations of greenhouse gases are expected to exacerbate present drought risks in the United States by increasing the rate of evaporation.”

    Water supplies in the Northwest and Southwest are also at risk. “Much of the water used by people in the western United States comes from snow melt,” the report said. “And a large fraction of the traditionally snow-covered areas of this region has experienced a decline in spring snow pack, especially since mid-century, despite increases in winter precipitation in many places.” Animal and plant species face risks as climate zones shift but urbanized regions prevent ecosystems from shifting as well, according to the draft report.

    “Because changes in the climate system are likely to persist into the future regardless of emissions mitigation, adaptation is an essential response for future protection of climate-sensitive ecosystems,” it said.

    [A hat tip to Jenny Bedell-Stiles]

    Solar Company To Open Nation's Largest Solar Silicon Wafer and Solar Cell Production Plant in Oregon

    SolarWorld AG Purchases Empty Silicon Wafer Plant in Hillsboro

    SolarWorld AG announced plans Thursday to establish a solar silicon wafer and solar cell production plant in Hillsboro, Oregon that it expects to become the largest in the United States by 2009. SolarWorld expects to invest $440 million in the plant, hiring as many as 1,000.

    Gov. Ted Kulongoski, who has worked with business leaders to champion sustainability as the state's new industrial focus [see previous post], said SolarWorld would help Oregon move toward energy independence. Strong public policy support, including the expanded Business Energy Tax Credit and the proposed Renewable Energy Standard, could help make Oregon a hub for solar and other renewable energy industries.

    According to the Oregonian, the publicly held Germany solar company is buying the plant for $40 million -- a bargain in comparison with the $500 million spent by Japan's Komatsu Silicon America, which finished the factory in 1998 but never opened it because of forecasts of declining chip sales.

    Governor Kulongoski and his staff have been working behind the scenes for several years to market Oregon as an ideal site for a new solar hub. Oregon's existing 'Silicon Forest' high-tech corridor has brought both the infrastructure and experienced workforce to Oregon for silicon-related businesses, much of which is applicable to the solar wafer and cell manufacturing industry. In addition, the strong Business Energy Tax Credit provides incentives for locating solar and other renewable energy manufacturing in Oregon.

    The SolarWorld announcement is a major coup for Oreogn's economic development efforts. SolarWorld's investement dwarfs other recent high-profile industry announcements, including South San Francisco-based biotech company, Genentech, Inc., which recently announced plans to invest $250 million in a drug processing and packaging plant nearby the Komatsu Factory in Hillsboro's technology park. Genentech as announced it plans to hire as many as 300 by 2015.

    The Oregonian reports that the SolarWorld deal differed from the Genentech plan both in terms of its speed and its package of government incentives.

    According to the Oregonian, the German solar company will mainly hire highly skilled workers -- ranging from engineers to research-and-development positions -- at salaries above those of other operations the state has attracted recently, such as Amy's Kitchen, a Medford-area maker of burritos and other oven-ready meals.

    And the investment could pioneer a new industry in Oregon, that may help keep Oregon's economy thriving as some existing high tech manufacturers ship jobs overseas.
    "We usually go through this courtship dance," Hillsboro Mayor Tom Hughes said. "This was like the boogie-woogie."

    Only last fall, SolarWorld acquired the solar business of oil giant Royal Dutch Shell, which had taken it over from Siemens AG. The deal gave SolarWorld, founded in 1998, plants in Vancouver as well as in Camarillo, Calif.

    Robust demand for solar panels quickly pushed SolarWorld to expand. In December, company representatives toured the 422,000-square-foot former Komatsu plant. "It was amazing to see such a huge site in that good condition after 10 years, and to imagine that the company wasted more-or-less a half a billion dollars for just building it," said Boris Klebensberger, SolarWorld chief operating officer. "It will fit all our needs."

    The plant will hold at least 1,000 workers by 2010, SolarWorld CEO Frank Asbeck said Thursday in Germany, according to The Associated Press. But Klebensberger said "some hundreds" of workers would be hired for the first phase and "several hundred" thereafter.

    Genentech held lengthy negotiations, brokering a property tax deal under the state's Strategic Investment Program (SIP). But SolarWorld was content with local property tax breaks and a chance to apply for refunds under the state's business-energy tax credit program.

    Under the program, SolarWorld could receive credits worth 35 percent of $50 million or more in eligible project costs, depending on how much of the investment qualifies for the tax breaks. The percentage could increase under legislation passed by the Oregon House of Representatives on Thursday. But the tax breaks are unlikely to approach the amounts awarded under the SIP to big semiconductor manufacturers during the 1990s.
    The new Hillsboro plant will be able to produce solar silicon wafers and cells capable of generating 500 megawatts of electricity a year, the Oregonian reports. SolarWorld plans to shift its solar wafer-making work -- and their current staff of approximately 100 workers -- from its plant in Vancouver to the new facility Hillsboro. The company is also expanding its plant in Freiberg, Germany.

    It is my hope that this announcement is the first of many to come over the next several years. With the passage of the proposed Renewable Energy Standard as well as the packaged of supporting legislation, including the Business Energy Tax Credit, Oregon should be quite attractive to the renewable energy industry, both for energy projects and manufacturing.

    Governor Kulongoski's plan to set Oregon up as a hub for the renewable energy and energy efficiency industries is an excellent strategy to ensure a strong economy while helping Oregon expand its energy independence.

    Oregon is particularly well suited to become a new solar hub. Like Silicon Valley in California, where many solar manufacturers have opened factories, Oregon's Silicon Forest has created the necessary base of silicon industry infrastructure and expertise to make Oregon a perfect site for the solar photovoltaic industry to set up shop.

    Hopefully the SolarWorld wafer and cell production factory will become an anchor for a new solar industry in Oregon. The plant will ideally attract PV panel manufacturers, who can purchase silicon wafers and cells from the SolarWorld factory.

    The expanded Business Energy Tax Credit and net metering and interconnection standards, which will encourage a more robust solar industry in Oregon, along with the proposed Renewable Energy Standard will also help create a strong demand for solar panels in Oregon.

    Let's hope this is the beginning of a new Oregon solar industry!

    [Image Source: Addison Engineering, Inc.]

    Renewable Energy Bills Fly Through Oregon House

    The Oregon State House passed a package of expansive tax credits and mandates on Thursday that are designed to compliment the proposed Renewable Energy Standard and position the state as a leader in renewable energy.

    The House unanimously approved an expansion of tax credits promoting renewable energy and energy efficiency for both businesses and individuals. Legislation intended to jumpstart the biofuels industry in Oregon with a mix of production incentives and blending requirements also passed the House with only four "No" votes. The bills now move to the Senate.

    The three bills all received broad support from an unusual set of bedfellows: environmental advocates lobbied alongside the Oregon Farm Bureau, the Oregon Business Association and others to give the renewable energy package bipartisan momentum.

    The biofuels bill, House Bill 2210, provides a package of incentives for the production of biofuels and the production and collection of biofuel feedstocks in Oregon. The bill also includes a renewable fuels standard that requires the blending of an increasing percentage of ethanol and biodiesel in gasoline and diesel sold in Oregon, provided that production of biofuels in Oregon grows to a sufficient size.

    House Bill 2211 expands the popular and successful Business Energy Tax Credit (BETC) in Oregon. Currently, the credit provides a tax credit of 35% of eligible project costs up to a maximum of $3.5 million on renewable energy and energy efficiency projects. Businesses manufacturing components and technologies used in renewable energy and energy efficiency products are also eligible for the BETC. The BETC thus provides incentive for both the expanded use of renewable energy and energy efficiency, as well encouraging industries production renewable energy and energy efficiency products to locate manufacturing in Oregon.

    HB 2211 would expand the BETC to cover 50% of eligible project costs and raise the maximum credit up to $10 million.

    The BETC is already the largest business tax break on Oregon's books, with an estimated revenue impact of $23 million for the 2007-09 budget cycle. The proposed expansion would cost the state another $1.9 million in 2007-09, according to state estimates, increasing to more than $12 million in 2009-11.

    The expansion of the BETC will position Oregon at the forefront of states courting new jobs in manufacturing in the renewable energy and energy efficiency sectors.

    According to solar energy developers I have spoken to here in Oregon, the expanded BETC, along with revised and more liberal net metering and interconnection rules that will go into effect next year, will make solar installations up to two megawatts in size 'pencil out' financially in Oregon. The BETC will thus also help create a more robust solar energy industry in Oregon.

    The third bill, HB 2212, expands the Residential Energy Tax Credit (RETC) for individuals. Currently, the RETC offers tax credits of up to $1,000 for installing energy efficient appliances and heating and cooling systems, up to $6,000 for solar photovoltaic systems, and up to $1,500 for other renewable energy systems, including small wind and solar hot water heating. However, an individual can claim the RETC for only one installation in any given calendar year.

    HB 2212 would raise the maximum credit for energy efficient appliances and heating and cooling systems to $1,500 and the credit for wind, solar hot water, fuel cells and other renewable energy technologies up to $6,000 to match the current credit for solar photovoltaics. The bill would also allow an individual to claim a tax credit for more than one system in the same calendar year (for example, for both a solar photovoltaic system as well as for energy efficient appliances).

    The three bills passed by the House are part of a package of legislation promoting renewable energy in Oregon proposed by Governor Kulongoski [see previous post]. The last remaining major component of that package is the proposed 25% by 2025 Renewable Energy Standard (RES). Hearings are beginning on the proposed RES next Tuesday, March 6th in the Oregon Senate Environment Committee [more on that soon]. You can find much more on the proposed Renewable Energy Standard here.

    There's more on the bills that passed on Thursday at the Oregonian here.

    [Image source]

    Duke Energy Denied Plans to Construct Coal-fired Power Plant Due to Rising Costs of Coal

    Duke Energy Corp's request to build two new 800 megawatt coal-fired power plants at a site in North Carolina was denied Wednesday by state utility regulators.

    Citing soaring cost estimates for the power plants, which have increased more than 50% from original estimates, the state Utility Commission ruled that Duke could only construct one coal plant, and even then, only if the utility retired four aging coal-fired units as soon as the new plant came online.

    Duke Energy would also be required to invest at least one percent of its annual retail revenues from electricity sales in energy efficiency programs.

    The Utility Commission sided with critics of the proposal who argued that Duke should look to renewable and conservation to meet growing demand, instead of building new coal-fired power plants [this decision echoes the recent decision in Oregon denying PacifiCorp's request to build new coal-fired power plants, see previous post].

    If Duke Energy opts to build one new 800 MW power plant at their Cliffside Steam Station site, they will be required to shutter the four existing generators at the Cliffside site, which have a total capacity of 198 MW.

    This Utility Commission decision also reflected concerns from residents living near the Cliffside site that new coal-fired generation at the site in addition to the current aging coal-fired generation at the site would greatly increase local air pollution.

    Only one commissioner dissented from the ruling, and did so because he believed the entire proposal should have been thrown out.

    There's more at Hemscott Investment News here.

    [Image from: Think]

    Five Western States Team Up to Battle Global Warming

    Governors of Oregon, Washington, California, Arizona and New Mexico Will Work Together to Set Caps on Greenhouse Gas Emissions

    [From the Oregonian:]

    Oregon will join four other Western states in setting limits on greenhouse gases produced by everything from the car you drive to the power plant that supplies your electricity.

    In taking the action Monday, Oregon, Washington, California, Arizona and New Mexico build momentum for a national strategy to control carbon dioxide and other gases that contribute to global warming. States are increasingly pressing forward on their own amid inaction by the Bush administration and Congress.

    Capping emissions from fossil-fuel burning power plants could also push energy companies toward wind and other renewable energy.

    Gov. Ted Kulongoski helped broker the five-state deal and signed onto it Monday with the governors of the other states.

    [Image: The five western states joining the global warming compact represent about 11% of total United States emissions of global warming pollutants. The five states will set goals and create a strategy to reduce emissions within 18 months.]

    The compact "sends a message to Congress and the White House that if they fail to enact policies at the national level to reduce greenhouse gas emissions and do our nation's part to combat global warming, that states will do it on their own," Kulongoski said.

    The governors said the West is especially vulnerable, as global warming leads to more severe droughts and wildfires; and earlier snowmelt, leaving less water in the heat of summer.

    Each of the states in the western strategy was already acting on its own to address global warming. All the governors who signed the agreement are Democrats, except Gov. Arnold Schwarzenegger of California.

    The strategy has potential to grow to include other states and British Columbia, which has invited West Coast states to join its efforts, said David Van't Hof, an adviser to Kulongoski. He said a primary goal of the strategy is to motivate the federal government to act, and to protect the interests of Western states if it does.

    "Rather than wait for them to act, we're trying to influence where it's heading," Van't Hof said.

    East Coast pact

    The western effort is the second broad regional move to address global warming. Nine Eastern states have already joined to limit emissions from power plants only and create a cap-and-trade system for the plants to buy and sell credits they get for reducing emissions.

    The Western states strategy is general and does not specify how the states will control greenhouse gases. But they will target all the major sources: vehicle exhaust and industrial sources as well, according to the governors and their aides.

    To start out, the states will set goals for slowing the growth of greenhouse gas emissions and then cutting them back. Then, within 18 months, they will establish a strategy for reducing the emissions.

    One option is a cap-and-trade system that limits carbon dioxide released as electricity is generated. It would require utilities that sell electricity in Oregon, for instance, to control the resulting carbon dioxide. If they cannot control it, they might instead buy credits from those that do.

    Utilities could also fund programs to offset their emissions by planting trees to soak up the gases, for example.

    Emissions limits would probably also extend to vehicles in some form, since they produce about a third of carbon dioxide released nationwide. Oregon has already adopted stricter tailpipe standards that reduce vehicle pollution and emissions.

    Limiting power plant emissions will probably push electricity prices up a few percent or more as power companies pay for the controls. But a draft strategy developed in Oregon would channel more money into making homes and businesses more energy efficient, so they would burn less power overall and their bills might decline.

    "You're either behind the curve or you're ahead of it, and this puts Oregon ahead of it," said Jason Eisdorfer, an attorney with Citizens' Utility Board of Oregon. "Oregon is not going to solve global warming itself, but these five states together can make a significant contribution."

    Depending on the approach, the Legislature would probably have to approve greenhouse gas controls. California has already instituted tough limits on carbon dioxide and is talking with the United Kingdom about combining forces in a joint strategy.

    The Western states that joined the strategy Monday together emit about 11 percent of all carbon dioxide nationwide. Experts said that by itself shows that the effort must expand if it's going to have much hope of heading off global warming.

    "Even the U.S., by itself, isn't going to deal with this problem," said Mark Trexler, president of Trexler Climate + Energy Solutions, a Portland consultant who helps companies prepare for global warming regulations.

    Utilities' hope

    Power company officials said Monday they hope the Western states' strategy paves the way for a national system to control greenhouse gases. They said they would prefer a nationwide program to a complicated web of state and regional strategies.

    "It would be nice to have something consistent," said Bekki Witt, a spokeswoman for PacifiCorp, which operates and buys power from 14 coal and natural gas plants.

    The more states are involved, the broader the opportunities will be to buy and sell emissions credits in a way that keeps power prices down, said Dave Robertson, government affairs director at Portland General Electric. PGE is lobbying for national legislation, he said.

    Many leading utility companies are now doing the same.

    By driving up the price of fossil-fuel based power plants, the strategy could shift more efforts toward the development of renewable energy from the sun, wind and waves.

    "It is also a huge economic development opportunity, particularly for those states who are most aggressive in leading the charge toward a clean energy future," Kulongoski said.