Local Views On Climate Change & Clean Energy Jobs

Jul 21: As part of the continuing series of climate legislation hearings, the Senate Environment and Pubic Works (EPW) Committee, Chaired by Senator Barbara Boxer (D-CA) held a hearing entitled, Clean Energy Jobs, Climate-Related Policies and Economic Growth -- State and Local Views. Witnesses testifying at the hearing included: Governors from Colorado; Washington; North Dakota; and New Jersey and Mayors from Burlington, Vermont; Alexandria, Virginia; and Trenton, New Jersey; an Arkansas State House Representative.

In an opening statement Chairman Boxer said, "We are facing two historic challenges today -- the current recession, and the dangers of unchecked global warming. And we have the opportunity to address both with a single solution that will create millions of clean energy jobs in America, reduce our dependence on foreign oil, and protect our children and grandchildren from pollution.

"I agree with President Obama, who said: 'We can remain one of the world's leading importers of foreign oil, or we can make the investments that would allow us to become the world's leading exporter of renewable energy. We can let climate change continue to go unchecked, or we can help stop it. We can let the jobs of tomorrow be created abroad, or we can create those jobs right here in America and lay the foundation for lasting prosperity.' Legislation that provides incentives for clean energy will create jobs, increase our energy efficiency, save families and businesses money in energy costs and drive technological innovation."

EPW Ranking Member James Inhofe (R-OK), with a completely opposite view said, "As I’ve stated before, cap-and-trade benefits the coasts at the expense of the heartland. Cap-and-trade divides rather than unites America behind a sensible, workable energy policy." Senator Inhofe cited the testimony of Arkansas State Representative John Lowery, a Democrat, who said, "When it comes to Waxman-Markey, unfortunately this bill will devastate my region. It will kill jobs, harm our school system, throw back our economic progress gained the last few years, and imposes a disproportionate burden on Arkansans."

Inhofe continued saying, "Rep. Lowery also speaks eloquently about a 'way of life' that would perish under cap-and-trade. He is referring to life in Arkansas and rural America. Cap-trade supporters see rural America as wasteful and environmentally backward. They see those in rural America as mere contingencies in the battle to save the planet. But these are real people with real jobs and real families. And for them, cap-and-trade will spell economic disaster. The debate over cap-and-trade does is not partisan; it’s regional. And I can tell you, when it comes to energy policy, Democrats in the Midwest and the South think differently than Speaker Pelosi and Henry Waxman."

Access the hearing website for links to testimony, Senator Boxer's statement and a webcast (click here). Access the complete statement from Senator Inhofe (click here).

EPA Administrator Jackson Speaks Out On Environmental Justice

Jul 21: U.S. EPA Administrator Lisa Jackson delivered a major speech on environmental justice to the National Environmental Justice Advisory Council (NEJAC). NEJAC is conducting a Public Meeting in Arlington, Virginia from July 21 – 23. The Council is participating in discussions about EPA priorities related to environmental justice, school air toxics monitoring, recommendations for goods movement impacts on air quality, and other topics.

The following is an excerpt from the Administrator's speech and a reaction from the Sierra Club. Jackson said, "Earlier this year we also provided $800,000 in grants to fund environmental justice projects. Those will address environmental and public health issues in 28 states. And we’ve also been working hard to expand our message to new communities. I just returned from the 80th annual meeting of the League of United Latin American Citizens, where we discussed the unique challenges their community faces. Tomorrow, I’ll be speaking to a tribal group. And I’ve had several meetings with many of your local Environmental Justice partners across the country.

"But let me say loud and clear: this is just the beginning. The inauguration of the first African American president, and my subsequent confirmation as the first African American Administrator of this Agency, has forever changed the face of environmentalism in this country. I hope it sends a clear signal that environmentalism does not come in any one shape, size, or look. And if anyone lives out this truth on a daily basis -- it’s you. Environmentalism is not only about protecting wilderness or saving polar ice caps. As important as those things are, environmentalism is also about protecting people in the places where they live, and work, and raise families. It’s about making our urban and suburban neighborhoods safe and clean, about protecting children in their schools, and workers at their jobs. . .

"We have to go to every community – especially those that have been left out and left behind – and impress upon them that the issues of environmental protection are their issues, their work is our work, and their struggles are our struggles. I want you to know that I get that. I also want to be sure we’re not only talking about downsides. We have in President Obama a leader who rejects the false choice between a green environment and a green economy. That opens up opportunities to create green jobs in the places where both the 'green' and 'jobs' are absolutely vital. . .

"In the years ahead, I want to see a full-scale revitalization of what we do and how we think about environmental justice. This is not an issue we can afford to relegate to the margins. It has to be part of our thinking in every decision we make. And not just at EPA. We need the nonprofit sector. We need the academic sector. And we need the private sector. It’s absolutely essential that we have a wide range of voices raising these issues. . . My friends, the EPA is once again guided by a broad vision of public health protection and environmental preservation. Environmental justice is central to that vision. I look forward to making real progress in the months and years ahead, and continuing this important partnership."

Sierra Club applauded Administrator Lisa Jackson's call for greater diversity in the environmental movement and indicated it "takes pride in our leadership on these issues." Sierra Club President Allison Chin said, "Now, with the leadership of a diversity council and my election as our first Asian-American president, Sierra Club is committed to becoming an even more welcoming and inclusive organization."

Leslie Fields, Director of the Sierra Club's Environmental Justice and Community Partnerships program said, "The environmental movement should belong to anyone who wants clean air, clean water and a healthy planet for their families. All too often people face disproportionate risks of harm because of their demographic characteristics or economic condition, and we applaud Administrator Jackson for her sincere leadership in supporting more diversity in the environmental movement so all people can have a voice."

Access the complete text of Jackson's speech (click here). Access a release from Sierra Club with links to additional information (click here). Access the agenda for the NEJAC meeting (click here). Access the NEJAC website for additional information (click here). Access EPA's Environmental Justice website for more information (click here).

U.S. & International Auto Makers Oppose E15 Fuel Waiver

Jul 20: Despite the recent support announced by 10 Midwestern governors supporting the proposal [See WIMS 7/17/09] that ethanol blending levels be increased from 10 to 15 percent (i.e. E15 Waiver), the Association of International Automobile Manufacturers (AIAM) filed comments to U.S. EPA opposing the waiver request. EPA extended the comment period by 60 days to July 20, 2009, on a waiver application submitted by Growth Energy and 54 ethanol manufacturers on March 6, 2009 [See WIMS 5/15/09].

Michael Stanton, President and CEO of AIAM, issued a statement saying, "AIAM and its member companies have long recognized the importance of addressing climate change and have supported efforts to reduce greenhouse gas emissions while significantly increasing fuel economy. With so much progress made by government and industry in recent months to meet these goals, we believe it would be premature for EPA to approve the near-term distribution and sale of fuels containing more than 10% ethanol without further testing to prevent unintended negative consequences.

"The Clean Air Act requires producers of any new fuel or fuel additive to show that those fuels will not contribute to the failure of vehicles or engines to meet emissions standards. Most vehicles currently being driven by American consumers were not designed to operate on ethanol blends greater than E10. If EPA were to approve the sale of such fuels, we believe a range of problems would result that could jeopardize the control or reduction of automotive emissions. These problems include the potential for immediate harm to, or failure of, highly calibrated emissions systems that were not designed to operate on such 'mid-level' fuels as E15. Further, many vehicles today are equipped with onboard diagnostic (OBD) systems as part of an integrated emissions control system. Testing to determine how E15 may negatively affect the proper operation of OBD systems is insufficient at this time.

"The consequence of potential equipment malfunctions caused by the use of E15 extends beyond failure to sufficiently control emissions. It will also create a high risk of consumer dissatisfaction due to drivability problems which would needlessly damage product reputation and imperil customer satisfaction with dealer service. Such drivability problems may also tempt consumers to tamper with emission controls in an effort to improve performance. Owner satisfaction may be further jeopardized by the reduction of fuel economy they will experience as a consequence of switching from E10 to E15.

"Another issue yet to be sufficiently studied is the potential negative impact E15 would have on the fuel production, distribution and marketing infrastructure. In particular, EPA should fully evaluate how the addition of a new blend of fuel will affect service station storage and pump systems and the ability of customers to select the right fuel for his or her vehicle. AIAM and other industry groups whose products and customers would be affected by the introduction of E15 are working cooperatively with the Department of Energy and the Environmental Protection Agency to conduct the needed studies to assess the impacts of introducing mid-level ethanol blends to the market. These studies have been identified and stakeholders are moving ahead to fill gaps in current knowledge about the practical consequences of increasing the ethanol content in gasoline. To approve a waiver before these studies are completed would be premature. We encourage EPA to delay approval of the waiver until sufficient testing has been conducted."

AIAM represents 13 international motor vehicle manufacturers who account for 40 percent of all passenger cars and light trucks sold annually in the U.S. Member companies include Aston Martin, Ferrari, Maserati, Honda, Hyundai, Isuzu, Kia, Mitsubishi, Nissan, Peugeot, Subaru, Suzuki and Toyota.

Similarly, the Alliance of Automobile Manufacturers (Alliance), representing 11 vehicle manufacturers including BMW Group, Chrysler Group LLC, Ford Motor Company, General Motors, Jaguar Land Rover, Mazda, Mercedes-Benz USA, Mitsubishi Motors, Porsche, Toyota and Volkswagen; also opposes the waiver. The Alliance said specifically, "The Alliance asks EPA to deny this waiver application, in whole and in part, because insufficient data are available to determine whether the proposed fuel blend(s) can satisfy the legal requirements under the Clean Air Act section 211(f)(4). The Alliance intends these comments to be read in conjunction with comments being submitted separately by the Alliance for a Safe Alternative Fuels Environment (AllSAFE), of which the Alliance is a member. The AllSAFE comments discuss more fully our concerns regarding the concept of a partial waiver. We incorporate the AllSAFE comments here by reference."

The Alliance said further in its details comments, "Historically, EPA has never allowed conventional vehicles to use gasoline blends with more than 10% ethanol. Until very recently, neither auto manufacturers nor others had a reason to design, test or warrant conventional vehicles (intended for the U.S. market) for use with higher ethanol blends. As a result, the public and private data bases are very limited. The application presents a serious concern for automakers and consumers. It is asking for approval of ethanol blends for which the vast majority of the current fleet and the near term future fleet have not been designed or validated. Flexible Fueled Vehicles (FFVs) can handle any ethanol blend from E0 to E85, and while their numbers are growing rapidly, they still represent a minority of the fleet."

In announcing their support for the waiver, the Midwest Governors indicated that allowing greater blending levels would increase demand for conventional ethanol, an entirely domestic energy source. Michigan Governor Jennifer Granholm, chair of the Midwestern Governors Association (MGA) said, “The Midwest has vast natural resources, the scientific know-how, and the skilled workforce necessary to lead the world in the production of climate-friendly biofuels. We must capitalize on these strengths in order to promote the use of low carbon fuels across the country.”

Access a release from AIAM (click here). Access AIAM's 35-page comment submission (click here). Access the detailed 76-page comments from the alliance (click here). Access the EPA Docket for the E15 Waiver for all documents to review all comments (click here). Access the release from the Governors (click here). Access additional information from EPA's website (click here).

Grants & New 2008 Wind Technologies Market Report

Jul 16: U.S. Department of Energy (DOE) Secretary Steven Chu announced the selection of 28 new wind energy projects for up to $13.8 million in funding -- including $12.8 million in Recovery Act (ARRA) funds. The projects will help address market and deployment challenges including wind turbine research and testing and transmission analysis, planning, assessments. Along with the new awards, Secretary Chu announced the release of DOE’s 2008 Wind Technologies Market Report, detailing $16 billion in investment in wind projects made in the U.S. in 2008 -- making the U.S. the leader in annual wind energy capacity growth, as well as cumulative wind energy capacity.

DOE’s new report, a comprehensive overview of developments in the U.S. wind power market found that wind power capacity increased by 8,558 megawatts (MW) in 2008. This $16 billion investment in wind projects made the U.S. the fastest-growing wind power market in the world for the fourth consecutive year. Wind power contributed 42% of all new U.S. electric generating capacity in 2008; for the fourth consecutive year, wind power was the second-largest new resource added to the U.S. electrical grid in nameplate capacity.

The report, which has been issued annually since 2007, analyzes a range of developments in the wind market, including trends in wind project installations, turbine size, turbine prices, wind project costs, project performance, and wind power prices. The report also details trends in project financing, a key concern for the wind industry in the current economic climate, as well as trends in project ownership, public policy, and the integration of wind power into the electrical grid. DOE’s report provides the wind industry, state and local policy makers, and the general public with valuable information on the state of wind power in the United States.

Some of the key findings of the report include:

• The U.S. continues to lead the world in annual capacity growth and overtook Germany to take the lead in cumulative wind capacity. For the fourth straight year, the United States led the world in wind capacity additions, capturing roughly 30% of the worldwide market.
• The cumulative wind capacity installed in the U.S. at the end of 2008 would, in an average year, be able to supply roughly 1.9% of the nation’s electricity consumption.
• Soaring demand for wind has spurred expansion of wind turbine manufacturing in the U.S. As a result of this continued expansion, the American Wind Energy Association estimates that the share of domestically manufactured wind turbine components has grown from less than 30% in 2005 to roughly 50% in 2008, and that roughly 8,400 new domestic manufacturing jobs were added in the wind sector in 2008 alone.
• Texas led all states with 7,118 MW of total wind capacity installed, followed by Iowa (2791 MW) and California (2517 MW). Seven states now have more than 1,000 MW installed, and 13 have more than 500 MW.
• Iowa and Minnesota have the highest levels of wind penetration (in-state wind generation as a percentage of all in-state generation). Seven states have wind penetration levels greater than 5%; six utilities have in excess of 10% wind on their systems.
• Wind power remained competitive in wholesale power markets in 2008, with average wind power prices at or below the low end of the wholesale power market price range, although upward pressure on wind power prices looks set to continue.

Access a release listing the grants and link to the complete 2008 Wind report (click here).

Parties At Odds On Climate Legislation Competitiveness Impacts

Jul 16: The Senate Environment and Pubic Works (EPW) Committee, Chaired by Senator Barbara Boxer (D-CA) held another in a continuing series of meetings on various aspect of climate change legislation. The hearing was entitled, “Ensuring and Enhancing U.S. Competitiveness While Moving Toward A Clean Energy Economy.” Witnesses testifying included representatives from: Kleiner Perkins Caufield & Byers (KPCB); GE Energy Infrastructure; the Center for American Progress Action Fund; and the National Black Chamber of Commerce.

In an opening statement, Chairman Boxer said, "we must ensure that our existing industries receive fair treatment as we transition to a clean energy economy. We need to make sure that our industries that require a lot of energy operate on a level playing field with manufacturers in other countries of the world. The legislation recently passed in the House contains several provisions to assist industries that are energy intensive and that are subject to international competition, and we are carefully reviewing these provisions as we develop our bill here in the Senate. . . Other countries, especially China and Germany, are already building their clean energy industries. I believe that when we pass strong clean energy legislation that cuts our dependence on foreign oil and protects our children from pollution, we will also provide the impetus that will restore American leadership in the world economy."

Ranking Member James Inhofe (R-OK) said the climate change legislation is based on ". . .faulty logic, which goes as follows: if government imposes taxes and mandates, increases bureaucracy, and spends without restraint, then government can transform the economy and create jobs. This is the faulty logic of cap-and-trade, designed to hide what cap-and-trade truly is -- a massive new tax on American families -- and what it would do -- destroy jobs here at home and send them to China and India. . . In total, Waxman-Markey would cause a net reduction of 2.3 million to 2.7 million jobs. Again, that’s a net reduction, including green jobs. . . This bill hands out pink slips to workers and then promises the unemployed that they will get assistance from the government. Message to the Waxman-Markey unemployed: don’t hold your breath. If this bill actually created jobs, then there would be no need for any of this. . ."

KPCB, a venture capital firm that has launched over 500 companies including Amazon, Google and AOL, testified urging the legislators to "put a price on carbon and a cap on carbon emissions." The company said, "Think of Copenhagen as an opportunity to create world markets and momentum for a low-carbon future, just as the internet set the world on information-rich future. Some say we shouldn't move until China moves. In fact, China is moving full speed ahead -- with or without us. Senators, there is still time for us to get into this global race. But we need low-carbon policies to exploit America’s strengths -- innovation and entrepreneurs. I know that building such a policy is a heavy political lift. But I can tell you, without doubt, that bad energy policy has cost our country dearly, and the costs of continuing it are incalculable."

The National Black Chamber of Commerce (NBCC) testified that it was concerned about its 95,000 business members of and that any legislation Congress enacts must consider the impact that costs will have on small and minority-owned businesses. NBCC said the House Waxman-Markey bill (H.R. 2454) "will negatively impact the most vulnerable of our society. . . the bill doesn’t do what it’s supposed to do, and it does so at a very high cost -- especially high for working families and small business owners." NBCC used the same CRA International analysis that Senator Inhofe cited and said that, "Green jobs gained would be swamped by jobs lost in old industries and businesses, leading to a net loss of 2.3 million to 2.7 million jobs." Countering the testimony of KPCB, NBCC said the, "House bill would limit our ability to compete internationally. Our study found that there is no environmental impact to justify this loss of income and siphoning away our nation’s wealth as long as developing nations such as China and India aren’t part of the program. They’ll be happy to open the factories and the businesses we can’t afford to build here."

Access the hearing website for links to all testimony, opening remarks and a webcast (click here).

Ozone & Climate Experts Meet To Rectify Treaties

Jul 16: An historic meeting, bringing together experts on the ozone layer and ones on climate change has been concluded this week in Geneva, Switzerland. The meeting centered on how to maximize action on hydroflurocarbons (HFCs) -- industrial gases that are ozone-friendly replacements but whose increased use over coming years could have serious impacts on global warming. The meeting, attended by national and international ozone and climate experts, was facilitated by the Ozone Secretariat of the United Nations Environment Programme (UNEP) and its Montreal Protocol in cooperation with the UN Framework Convention on Climate Change and its Kyoto Protocol.

The delegates looked at how the two treaties can work together to best address HFCs -- replacements for foams, air conditioning units and fridges -- as a contribution to meeting the climate change challenge. Achim Steiner, UN Under-Secretary General and UNEP Executive Director said, "In a financially constrained world, facing a climate-constrained one, governments need to maximize the economic and social benefits of action across the many environmental challenges of our time. The ozone treaties and the climate convention are natural allies in the push to combat climate change and are thus natural allies in assisting the world to realize a low carbon, resource efficient Green Economy -- I welcome this closer collaboration and look forward to hearing at first hand how this can be taken forward for the benefit of the climate and the global environment as a whole."

The Report by the Secretariat on the environmentally sound management of banks of ozone-depleting substances sets the stage for the meeting saying, "Over the past 20 years the Montreal Protocol on Substances that Deplete the Ozone Layer has reduced the production and consumption of ozone-depleting substances by more than 97 per cent from historic baseline levels. Because most ozone-depleting substances are potent global warming gases, the Protocol has also eliminated at least 11 billion tonnes of carbon dioxide equivalents, making it a significant contributor to efforts to combat climate change.

"While the Protocol has reduced production and consumption of ozone-depleting substances, such substances have historically been used in various types of user applications such as refrigeration and fire-fighting equipment and foam products currently in use. In addition, many companies and countries hold virgin, recovered, contaminated or confiscated ozone-depleting substances in discrete stockpiles. Together, the total amount of substances contained in existing equipment, products and stockpiles are referred to as “ozone-depleting substance banks”. The Protocol does not control ozone-depleting substance banks and, in the absence of legislation or incentives, they are likely to be vented or disposed of with little regard for the consequences for the ozone layer and climate change. Given this context, the Parties to the Montreal Protocol adopted decision XX/7, which called for, among other things, the present study on funding opportunities for the destruction of ozone-depleting-substance banks."

Access a release from UNEP (click here). Access complete information and documents from the meeting (click here).

UN Head Presses For "Ambitious" Mid-Term Targets & Baselines

Jul 14: Five top United Nations officials have added their names to a petition urging world leaders to "seal the deal" in Copenhagen, Denmark, this December on an ambitious new climate change pact aimed at curbing greenhouse gas emissions. Joining the growing list of names (5,622 to date) are Margaret Chan, Director-General of the World Health Organization (WHO); Michel Jarraud, Secretary-General of the World Meteorological Organization (WMO); Kanayo F. Nwanze, President of the International Fund for Agricultural Development (IFAD); Pascal Lamy, Director General of the World Trade Organization (WTO); and Francis Gurry, Director General of the World Intellectual Property Organization (WIPO).

The officials signed the online petition, which will be presented to leaders at the UN Framework Convention on Climate Change (UNFCCC), Conference of the Parties (COP15) gathering in Copenhagen, where negotiations are expected to wrap up on a successor pact to the Kyoto Protocol, whose first commitment period ends in 2012. The campaign calls for binding targets to be set on cutting emissions by 2020 and help for vulnerable countries so they can adapt to the effects of climate change. It also highlights the urgent need for a new deal that will spur ‘green’ growth, protect the planet and build a more sustainable and prosperous global economy that will benefit all countries and people. The interim binding targets issue has remained particularly contentious with major parties still far apart on the percent of greenhouse gas reduction and on the base year (i.e. 1990 or other) upon which to measure such reductions [See WIMS 7/13/09].

Last week, UN Secretary-General Ban Ki-moon said that the cuts in emissions proposed by the world’s largest economies are not deep enough, warning that greater efforts must be exerted by governments if a meaningful agreement on climate change is to be reached in the Danish capital. The Secretary-General said the climate change commitments made by the leaders of those countries and other participants during the G8 and Major Economies Forum (MEF) meetings in L’Aquila, Italy, “while welcome, are not sufficient. The time for delays and half-measures is over. The personal leadership of every head of State or government is needed to seize this moment to protect people and the planet from one of the most serious challenges ever to confront humanity.” Ban said that the long-term 2050 target agreement [i.e. 80% by 2050] was not credible without “ambitious mid-term targets, and baselines.” Ban is calling for firm commitments to reduce their emissions by 2020 on the order of the 25 - 40 per cent below 1990 levels which the Intergovernmental Panel on Climate Change (IPCC) says is required.

He said, with G8 countries responsible for more than 80 per cent of global emissions, “that is why they bear special responsibility for finding a solution to the political impasse. If they fail to act this year, they will have squandered a unique historical opportunity that may not come again… We stand at a historical crossroads. Business as usual is no longer viable.”

Access a release from the UN with links to the various organizations (click here). Access the Seal the Deal website for the petition, list of signers and campaign information (click here).

UN Report On ESG Legal Responsibility Of Institutional Investors

Jul 14: A release from the United Nations Environment Programme (UNEP) indicates that a powerful group of asset managers, representing around $2 trillion (USD) in assets under management, are arguing that integrating environmental, social and governance (ESG) considerations into investment decisions is no longer just a luxury, but a legal responsibility. The case, outlined in a new report with the UNEP, underlines how the world's largest institutional investors -- such as pension funds, insurance companies, sovereign wealth funds, mutual funds and foundations -- have a central role in assisting the transition to a low carbon and resource efficient Green Economy.

The report indicates that professional investment advisors and service providers -- such as investment consultants and asset managers -- to institutional investors may have a far greater legal obligation to incorporate ESG issues into their investment services or face "a very real risk that they will be sued for negligence" if they do not. The 120-page report has been produced by the Asset Management Working Group of UNEP Finance Initiative (UNEP FI), a unique partnership between the UN's environmental arm and over 180 financial institutions worldwide. The report also provides indicative legal language that can be used to embed ESG considerations in the investment management agreements and related legal contracts between institutional investors and their asset managers.

The new 2009 report -- UNEP FI "Fiduciary II" - Fiduciary Responsibility - Legal and Practical Aspects of Integrating Environmental, Social and Governance Issues into Institutional Investment -- is a follow-up and update to an earlier 2005 report (i.e. Fiduciary I).

Achim Steiner, UN Under-Secretary-General and UNEP Executive Director, said, "The significant environmental investments underpinning the current multi-trillion dollar stimulus packages are signaling the determination of some governments to make a transition to a more sustainable, 21st century economy. As investors return to the markets, the question remains whether the funds will only go to the brown economy of yesterday -- or to a new Green Economy. Market signals, creative market mechanisms and other signals and incentives can play a transformational role. This report also makes a powerful legal case for leadership in this area, underscoring the considered opinion of an influential group of asset managers that ESG issues are not peripheral but should be part of mainstream investment decision-making processes across the industry."

The report contains a message from the Asset Management Working Group which indicates, in part, ". .. with times of unusual crisis often come extraordinary moments of opportunity. For this reason, many of us in the field of responsible investment believe that the financial meltdown actually represents a unique opportunity to ‘recast’ some of the most basic tenets of fiduciary investment. After the fallout of the crisis, many fiduciaries will wisely look at the impact of the crisis on their investments, and look for new approaches to steward and allocate their assets."

The new UNEP FI report is released the day before the Principles for Responsible Investment (PRI) Annual Event in Sydney, Australia, which will convene many of the world's largest institutional investors and where the report's findings will be deliberated. Over 560 institutions from the global investment community, representing more than US$18 trillion in assets, have now signed on to the PRI, an initiative incubated by UNEP FI and the UN Global Compact between 2003 and 2006. The PRI was launched in 2006 by then UN Secretary-General Kofi Annan and endorsed in 2007 by current UN Secretary-General Ban Ki-moon.

The PRI is an investor initiative in partnership with UNEP FI and the UN Global Compact. Convened by UNEP FI and the UN Global Compact, the PRI was established as a framework to help investors achieve better long-term investment returns and sustainable markets through better analysis of environmental, social and governance issues in the investment process and the exercise of responsible ownership practices (See contact below).

Access a lengthy release from UNEP with extensive quotes from report authors and links to additional information (click here). Access the new Fiduciary II report (click here). Access the Fiduciary I report (click here). Access the PRI website for more information (click here). Access the PRI conference website for further details (click here).

"Breakthrough" & "Missed Opportunity" Of Climate Meetings

Jul 10: According to releases from the Union of Concerned Scientists (UCS), the organization sees both "breakthrough" and "missed opportunity" in the recent climate change meetings of the G8 and the Major Economies Forum (MEF) on Energy and Climate held last week in L’Aquila, Italy. UCS saw a breakthrough in the July 9, MEF meeting and "missed opportunity" in the G8 summit [See WIMS 7/9/09]. In a press statement summing up the international meetings, even President Obama acknowledged that, "We did not reach agreement on every issue and we still have much work ahead on climate change. . ."

UCS noted that while the G8 leaders recognized the important benchmarks of holding global temperature increases below 2 degrees C (3.6 degrees F) limiting their own emissions 80 percent by 2050, ". . .the failure to make any progress towards resolving the deep split among the G8 countries on the emissions cuts needed by 2020 is troubling. . . This lack of progress on 2020 targets and on financing led China, India, and other developing countries to refuse to agree to the goal of reducing global emissions 50 percent by 2050 in the MEF declaration. . . In short, the G8 summit represents a tremendous missed opportunity. With just five months to go, the heat is on the G8 leaders to inject political momentum into the climate negotiations. The limited progress made here in L'Aquila is nowhere near what's needed to get an ambitious and equitable climate deal in Copenhagen."

Regarding the MEF meeting, UCS said the leaders of the 20 largest world economies offered hope that at least one of the longstanding sticking points may be seriously addressed in the next few months. UCS indicated, "Financial and technology support to developing countries to limit their emissions and adapt to the impacts of climate change is one of the most critical issues in the climate negotiations. The G-20 summit in September is the last time before Copenhagen that all of these leaders will be in one place together. If the initiative announced today by President Obama results in serious action on these issues by leaders at the G-20 meeting, it could be a real game-changer. The need for more ambitious near-term emissions reductions by industrialized countries, as well as the need for additional actions by major developing countries to constrain their emissions must also be addressed to get a strong climate agreement this December in Copenhagen. But today's announcement gives us hope that with sufficient political will, such an agreement is not out of reach."

Specifically, the MEF declaration said in part, "There is a particular and immediate need to assist the poorest and most vulnerable to adapt to such effects. . . Further support will need to be mobilized, should be based on need, and will include resources additional to existing financial assistance. We will work together to develop, disseminate, and transfer, as appropriate, technologies that advance adaptation efforts. . . Financial resources for mitigation and adaptation will need to be scaled up urgently and substantially and should involve mobilizing resources to support developing countries. . . An arrangement to match diverse funding needs and resources should be created, and utilize where appropriate, public and private expertise. We agreed to further consider proposals for the establishment of international funding arrangements, including the proposal by Mexico for a Green Fund."

However, as WIMS discussed previously, the language included with the G8 and MEF declarations was extremely general and allusive [See WIMS 7/9/09]. For example, while the developed countries agreed to reducing emissions of greenhouse gases in aggregate by 80% or more by 2050 the base year upon which to make the measured reduction is indicated as "1990 or more recent years." The G8 nations also say they will "undertake robust aggregate and individual mid-term reductions," but again remain unspecific regarding a baseline year from which to measure reductions and instead say "baselines may vary" but "efforts need to be comparable." Further, the G8 calls for "major emerging economies" to collectively reduce emissions "significantly below business-as-usual by a specified year."

The MEF statement is even more general in some regards saying the countries "recognize the scientific view" that global average temperature "ought not to exceed 2 degrees C," and they will work between now and Copenhagen, with each other and under the Convention, to identify a "global goal for substantially reducing global emissions by 2050."

In his statement following the MEF meeting President Obama outlined the difficulties ahead. He said, "We've made a good start. But I am the first one to acknowledge that progress on this issue will not be easy. And I think that one of the things we're going to have to do is fight the temptation towards cynicism, to feel that the problem is so immense that somehow we cannot make significant strides. It is no small task for 17 leaders to bridge their differences on an issue like climate change. We each have our national priorities and politics to contend with, and any steps we agree to here are intended to support and not replace the main U.N. negotiations with more than 190 countries.

"It's even more difficult in the context of a global recession, which I think adds to the fears that somehow addressing this issue will contradict the possibilities of robust global economic growth. But ultimately, we have a choice. We can either shape our future, or we can let events shape it for us. We can fall back on the stale debates and old divisions, or we can decide to move forward and meet this challenge together. I think it's clear from our progress today which path is preferable and which path we have chosen. We know that the problems we face are made by human beings. That means it's within our capacity to solve them. The question is whether we will have the will to do so, whether we'll summon the courage and exercise the leadership to chart a new course. That's the responsibility of our generation, that must be our legacy for generations to come, and I am looking forward to being a strong partner in this effort."

Access two release from UCS (click here); and (click here). Access the MEF July 9 Declaration (click here). Access the detailed 40-page G8 document (click here). Access the President MEF statement (click here). Access a White House fact sheet on the MEF meeting (click here). Access further information from the State Department MEF website (click here).

$3 Billion For 5,000 Renewable Energy Projects & Guidance

Jul 9: As part of an innovative partnership aimed at increasing economic development in urban and rural areas while setting the nation on the path to energy independence, the U.S. Department of the Treasury and the U.S. Department of Energy announced an estimated $3 billion for the development of renewable energy projects around the country and made available the guidance businesses will need to submit a successful application. Funded through the American Recovery and Reinvestment Act (ARRA, Recovery Act), the program will provide direct payments in lieu of tax credits in support of an estimated 5,000 bio-mass, solar, wind, and other types of renewable energy production facilities.

Treasury Secretary Tim Geithner said, “The renewable energy program provides another important avenue for the Recovery Act to contribute to economic development in communities around the country. It will provide additional stimulus to economies in urban and rural America by helping to develop domestic sources of clean energy. This partnership between Treasury and Energy will enable both large companies and small businesses to invest in our long-term energy needs, protect our environment and revitalize our nation’s economy.”

The Recovery Act authorized Treasury to make direct payments to companies that create and place in service renewable energy facilities beginning January 1, 2009. Previously, these companies could file for a tax credit to cover a portion of the renewable energy project’s cost; under the new program, applicants would agree to forgo tax credits down the line in favor of an immediate reimbursement of a portion of the property expense. This direct payment program allows for an immediate stimulus in local economies.

Department of Energy (DOE) Secretary Steven Chu said, “These payments will help spur major private sector investments in clean energy and create new jobs for America's workers. It is part of our broad effort to double our renewable energy capacity in the next few years and make sure that America leads the world in creating the new clean energy economy of the future.”

In previous years, the tax credit has been widely used. It is considered a successful incentive for encouraging the development of renewable energy. In 2006, approximately $550 million in tax credits were provided to 450 businesses. The rate of new renewable energy installations has fallen since the economic and financial downturns began, as projects had a harder time obtaining financing. The Departments of Treasury and Energy expect a fast acceleration of businesses applying for the energy funds in lieu of the tax credit.

The Treasury Department emphasized that it is not accepting applications for this program at this time. However, to help facilitate the timely flow of program funds to eligible businesses, the Department is publishing several key documents in advance in order to give ample time for businesses to prepare applications and expedite implementation of this program. Three documents are being posted: (1) guidance document; (2) terms and conditions; and (3) sample application form. Treasury notes that a notice, with further instructions, will be posted when it is ready to begin receiving applications via a web-based application designed to further expedite program implementation.

As provided in Section 1603 of the ARRA tax title, funds are provided for payments to persons who place in service specified "energy property" during 2009 or 2010 or after 2010 if construction began on the property during 2009 or 2010 and the property is placed in service by a certain date known as the credit termination date (described more fully below in the Property and Payment Eligibility section). Treasury will make Section 1603 payments to qualified applicants in an amount generally equal to 10% or 30% of the basis of the property, depending on the type of property. Applications will be reviewed and payments made within 60 days from the later of the date of the complete application or the date the property is placed in service. Qualified property includes expansions of an existing property that is qualified property under section 45 or 48 of the IRC.

Specified Energy Property includes: Large Wind; Closed-Loop Biomass Facility; Open-loop Biomass Facility; Geothermal under IRC sec. 45; Landfill Gas Facility; Trash Facility; Qualified Hydropower Facility; Marine & Hydrokinetic; Solar Geothermal under IRC sec. 48; Fuel Cells; Microturbines; Combined Heat & Power; Small Wind; and Geothermal Heat Pumps.

Access a release from DOE and link to the documents (click here). Access further information from the Department of Treasury (click here).

G8+ Members Adopt Climate Change & Energy Documents

Jul 8: The G8 Summit is in full swing dealing with the international economic crisis, climate change and food security in L’Aquila, Italy. The "expanded" formats adopted for the Summit in L'Aquila provides for meetings of the G8 member countries (Canada, France, Germany, Italy, Japan, Russia, the United Kingdom and the United States) on the first day, and for the involvement of the G5 group of countries (Brazil, China, India, Mexico and South Africa) plus Egypt (which has received a special invitation from the Italian Presidency) on the second day. On the same day, the debate will be opened up to include a further three countries (Australia, Indonesia and South Korea) representing the MEF (Major Economies Forum) to discuss the issues of climate changes and of food safety and security. Finally, a number of other countries, including the African countries and the six most important international organizations, will be brought into the debate on the last day, bringing the grand total to 39 countries all sitting down at the same table at once.

Specifically on climate change and energy matters, in a section entitled, Sustainable use of natural resources: climate change, clean energy and technology, of an overall 40 page document entitled, "Responsible Leadership For A Sustainable Future," dealing with the "interlinked challenges of the economic crisis, poverty and climate change," the G8 members indicate:

- The interlinked challenges of climate change, energy security and the sustainable and efficient use of natural resources are amongst the most important issues to be tackled in the strategic perspective of ensuring global sustainability. A shift towards green growth will provide an important contribution to the economic and financial crisis recovery.

- Science clearly shows that anthropogenic greenhouse gas emissions – mainly produced by the use of fossil fuels - are provoking dangerous climate change, putting at risk not only the environment and ecosystem services but the very basis of our present and future prosperity. The costs of inaction far outweigh the costs of moving towards low-carbon societies.

- We emphasize the paramount importance of technology development and diffusion on a global scale in meeting these challenges and accelerating the economic recovery, while moving towards a low-carbon society.

Specifically, in a subsection on Climate change and environment, the G8 heads state, "This is a crucial year for taking rapid and effective global action to combat climate change. We welcome the decision taken within the UN Framework Convention on Climate Change (UNFCCC) in Poznan to enter full negotiating mode, in order to shape a global and comprehensive post-2012 agreement by the end of 2009 in Copenhagen, as mandated by the Bali Conference in 2007. We must seize this decisive opportunity to achieve a truly ambitious global consensus.

"We reconfirm our strong commitment to the UNFCCC negotiations and to the successful conclusion of a global, wide-ranging and ambitious post-2012 agreement in Copenhagen, involving all countries, consistent with the principle of common but differentiated responsibilities and respective capabilities. In this context we also welcome the constructive contribution of the Major Economies Forum on Energy and Climate to support a successful outcome in Copenhagen. We call upon all Parties to the UNFCCC and to its Kyoto Protocol to ensure that the negotiations under both the Convention and the Protocol result in a coherent and environmentally effective global agreement. . ."

And, specifically, in item #65 of the document, the G8 heads indicate, "We recognize the broad scientific view that the increase in global average temperature above pre-industrial levels ought not to exceed 2°C [3.6°F]. Because this global challenge can only be met by a global response, we reiterate our willingness to share with all countries the goal of achieving at least a 50% reduction of global emissions by 2050, recognizing that this implies that global emissions need to peak as soon as possible and decline thereafter. As part of this, we also support a goal of developed countries reducing emissions of greenhouse gases in aggregate by 80% or more by 2050 compared to 1990 or more recent years. Consistent with this ambitious long-term objective, we will undertake robust aggregate and individual mid-term reductions, taking into account that baselines may vary and that efforts need to be comparable. Similarly, major emerging economies need to undertake quantifiable actions to collectively reduce emissions significantly below business-as-usual by a specified year." [emphasis added]

The document also provides some further commitments to be carried forward to the Copenhagen negotiations [Item #69]. The G8 heads indicate: "We support flexible, economically sound market-based approaches to emission reductions. In particular, cap & trade schemes, where implemented, have proved largely successful and improved understanding of the potential advantages, critical issues and indicators. The use of market mechanisms, including those under the Kyoto Protocol, provides opportunities to reduce emissions cost-effectively, while facilitating technology diffusion, low-carbon development and the involvement of emerging and developing countries. With a view to building on these experiences and to facilitate action under the global post 2012 agreement, we commit to:

a) further explore, taking into account national circumstances, the potential of carbon trading systems and their possible linkages; b) cooperate among us and with other countries to expand carbon markets to the extent possible and reduce costs and align emission allowance trading schemes, with a view to developing transparent carbon markets which would expand to involve emerging and developing countries, including on a sectoral basis; c) support the development, reform and enhancement of project, programmatic and policy-based offset mechanisms, including the Kyoto Protocol’s Clean Development Mechanism (CDM), in order to encourage their use, enhance their effectiveness and environmental integrity, and facilitate actions from developing countries under the global, post-2012 agreement; d) work with others to further develop market mechanisms under the Copenhagen agreement to possibly include sectoral trading and sectoral crediting mechanisms, to enhance the participation of emerging economies and developing countries in the market ensuring environmental integrity."

Importantly, the document also contains sections on Technology development and research; Financing; Adaptation; Natural disasters; Forests and land degradation; Biodiversity; Education for Sustainable Development; Clean and accessible energy;
Energy efficiency, diversification of the energy mix and technology; and Combating energy poverty.

The Major Economies Forum (MEF) on Energy and Climate consisting of Australia, Brazil, Canada, China, the European Union, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, South Africa, the United Kingdom, and the United States met today (July 9) and adopted an even more general statement. The MEF statement simply says, among other statements, "We recognize the scientific view that the increase in global average temperature above pre-industrial levels ought not to exceed 2 degrees C. In this regard and in the context of the ultimate objective of the Convention and the Bali Action Plan, we will work between now and Copenhagen, with each other and under the Convention, to identify a global goal for substantially reducing global emissions by 2050."

Access the day one press release (click here). Access the detailed 40-page document (click here). Access links to other documents of the G8 Summit 2009 (click here). Access the G8 2009 meeting website (click here). Access various media report of the G8 and climate change (click here). Access the MEF statement (click here). Access a White House fact sheet on the MEF (click here).

House Hearing On Regulation & Impacts Of Bottled Water

Jul 8: The House Energy and Commerce Committee, Subcommittee on Oversight and Investigations, Chaired by Representative Bart Stupak (D-MI) held a hearing on the "Regulation of Bottled Water" to examine the current federal regulation of bottled water. Witnesses testifying at the hearing included representatives of the: Government Accountability Office; Food and Drug Administration; International Bottled Water Association; and Environmental Working Group (EWG).

In his opening remarks, Chairman Stupak indicated that In 2008, Americans consumed 8.6 billion gallons of bottled water. He said, "Bottled water is a billion-dollar-a-year industry, with sales up more than 83% this decade. Many Americans believe that water they drink from a bottle is healthier than water that comes from their faucets. The Water Research Foundation found that nearly 56% of bottled water drinkers cite health and safety as the primary reason they choose bottled water over tap water. As a result, Americans are willing to pay top dollar for bottled water, which costs up to 1,900 times more than tap water and uses up to 2,000 times more energy to produce and deliver."

Stupak continued, "Over the past several years, however, bottled water has been recalled due to contamination by arsenic, bromate, cleaning compounds, mold, and bacteria. In April, a dozen students at a California junior high school reportedly were sickened after drinking bottled water from a vending machine." He said, ". . .municipal tap water suppliers are required to tell their customers within 24 hours if they find dangerous contaminants that exceed federal levels. But this requirement does not apply to bottled water companies. Certified laboratories must be used to test tap water, but bottled water has no similar requirement.

The Subcommittee received two new reports which Stupak said "raise questions about why the regulations governing bottled water are weaker than those governing tap water, as well as the widespread public perception that bottled water is healthier than water from the tap." One report was from the Government Accountability Office (GAO) that examines whether Federal and state authorities are adequately ensuring the safety of bottled water and the accuracy of claims regarding its purity and health benefits. The second was by the Environmental Working Group (EWG) which conducted an 18-month survey of bottled water labels and websites and concluded that just two of the 188 bottled water companies surveyed provided consumers with information on the source of their water, the manner in which it was treated, and any contaminants present.

The GAO report is entitled, Bottled Water: FDA Safety and Consumer Protections Are Often Less Stringent Than Comparable EPA Protections for Tap Water (GAO-09-610, June 22, 2009). GAO indicated that over the past decade, the per capita consumption of bottled water in the United States has more than doubled -- from 13.4 gallons per person in 1997 to 29.3 gallons per person in 2007. The GAO report addresses three issues: (1) the extent to which federal and state authorities regulate the quality of bottled water to ensure its safety, (2) the extent to which federal and state authorities regulate the accuracy of labels or claims regarding the purity and source of bottled water, and (3) the environmental impacts of bottled water.

In its report, GAO found that FDA’s bottled water standard of quality regulations generally mirror the U.S. EPA national primary drinking water regulations, as required by the Federal Food, Drug, and Cosmetic Act, although the case of DEHP (an organic compound used in the manufacture of polyvinyl chloride plastics) is a notable exception. Specifically, FDA deferred action on DEHP in a final rule published in 1996 and has yet to either adopt a standard or publish a reason for not doing so.

GAO also found that FDA’s regulation of bottled water, particularly when compared with EPA’s regulation of tap water, reveal key differences in the agencies’ statutory authorities. Of particular note, FDA does not have the specific statutory authority to require bottlers to use certified laboratories for water quality tests or to report test results, even if violations of the standards are found. Among GAO’s other findings, the state requirements to safeguard bottled water often exceed FDA’s, but still are often less comprehensive than state requirements to safeguard tap water.

GAO said FDA and state bottled water labeling requirements are similar to labeling requirements for other foods, but the information provided to consumers is less than what EPA requires of public water systems under the Safe Drinking Water Act. Like other foods, bottled water labels must list ingredients and nutritional information and are subject to the same prohibitions against misbranding. In 2000, FDA concluded that it was feasible for the bottled water industry to provide the same types of information to consumers that public water systems must provide. The agency was not required to conduct rulemaking to require that manufacturers provide such information to consumers, however, and it has not done so.

Nevertheless, GAO’s work suggests that consumers may benefit from such additional information. For example, when GAO asked cognizant officials in a survey of the 50 states and the District of Columbia, whether their consumers had misconceptions about bottled water, many replied that consumers often believe that bottled water is safer or healthier than tap water. GAO found that information comparable to what public water systems are required to provide to consumers of tap water was available for only a small percentage of the 83 bottled water labels it reviewed, companies it contacted, or company web sites it reviewed.

Among the environmental impacts of bottled water GAO said there are effects on U.S. municipal landfill capacity and U.S. energy demands. Regarding impacts on landfill capacity, GAO found that about three-quarters of the water bottles produced in the United States in 2006 were discarded and not recycled, on the basis of figures compiled by an industry trade association and an environmental nonprofit organization. Discarded water bottles, however, represented less than 1 percent of total municipal waste that EPA reported entered U.S. landfills in 2006. Regarding the impact on U.S. energy demands, a recent peer-reviewed article found that the production and consumption of bottled water comprises a small share of total U.S. energy demand but is much more energy-intensive than the production of public drinking water.

EWG released its 18-month survey of bottled water labels and websites, including top domestic and imported brands. They found that consumers spend 1,900 times more for bottled water than for tap water, yet they rarely know basic information about exactly what's in their water bottle. EWG said their survey shows that far too often consumers have no simple way to learn "three essential facts: 1) where their bottled water comes from, 2) how or if it's treated, and 3) what chemical pollutants it contains." [See WIMS 10/15/08].

The International Bottled Water Association (IBWA) submitted 31 pages of testimony and concluded, "Bottled water provides consumers with a convenient, healthy beverage choice. The standards of quality for bottled water are as protective of public health as those for public drinking water by law and practice. Such standards for bottled water are applied to each container and failure to meet those standards may result in a recall or FDA enforcement action. If a consumer is interested about what is in their bottled water, they have multiple methods of obtaining it, e.g., from the company website, contacting the company directly, researching state websites which post the information or IBWA’s website. If they are not satisfied with the response or the information provided, they have many choices among bottled water brands."

Access the hearing website for links to all testimony, charts, reports and letters (click here).

Senate Debate On Energy & Climate Legislation Begins

Jul 7: The Senate Environment and Pubic Works (EPW) Committee began its debate on energy and climate change legislation with a hearing entitled, “Moving America Toward a Clean Energy Economy and Reducing Global Warming Pollution: Legislative Tools.” Scheduled to testify are top Administration officials including: Steven Chu, Secretary of the Department of Energy; Lisa Jackson, Administrator U.S. EPA; Tom Vilsack, Secretary of the Department of Agriculture and Ken Salazar, Secretary of the Department of Interior.

Also, scheduled to testify are representatives from: The Dow Chemical Company; Natural Resources Defense Council; the Mayor of Braddock, Pennsylvania; and Haley Barbour the Governor of Mississippi. The hearing actually encompassed three separate sessions: opening statements by members and statements and questions of the Administration officials (10 AM -12 noon); testimony of Haley Barbour (12:45 PM); and testimony from the remaining witness panel (beginning at 2 PM).

Chairman Boxer opened the hearing with a statement calling the hearing the "kickoff of a historic Senate effort to pass legislation that will reduce our dependence on foreign oil, create millions of clean energy jobs, and protect our children from pollution." She said the EPW Committee has held more than 40 hearings and briefings on global warming since I took over the chairmanship in January of 2007. The EPW Committee consists of 11 Democrats; 1 Independent; and 7 Republicans.

She cited the recent Obama Administration's "sobering report" on the impacts global warming is already having across the United States [See WIMS 6/16/09], and the devastating effects that will come in the future if we do not take action to cut global warming pollution.

Boxer said, "I expect you will hear fierce words of doubt and fear and worse from the other side of the aisle regarding our legislative efforts to move forward with clean energy jobs legislation. This is consistent with a pattern of 'No, we can’t.' I believe that this Committee, when the votes are eventually taken on our bill, will reflect our President’s attitude, which is 'Yes, we can, and yes, we will.' Colleagues, this is the challenge to our generation that offers hope, not fear, and a way out of the environmental and economic challenges we face, so that our children will have a bright future."

Ranking Member James Inhofe (R-OK) was quick to respond with his opening statement. Senator Inhofe said, "I would note that the Senate has voted on cap-and-trade three times: in 2003, in 2005, and in 2008. In each and every instance, we defeated it. Now, Madame Chairman, here we go again." He indicated that the Republican EPW members issued a letter outlining our requests for a series of legislative hearings that are "based upon actual legislation." Inhofe said he hoped "we don't repeat the process in the House, when the majority released a 300 page manager's amendment at 3 am, the morning of the vote. "

Inhofe said, " You can be sure of this: once the American public realizes what this legislation will do to their wallets, they will resoundingly reject it. Perhaps that explains why we are rushing cap-and-trade through the Senate." He cited a new poll by Rasmussen, which found on July 1 that 56% of Americans are not willing to pay "ANYTHING" to fight global warming. He indicated, "My dear friend and Chairman has accused us of being the party of ‘no' for too long. Well, it's true that we say no to higher energy taxes, no to subsidizing the East and West coasts at the expense of the heartland, no to more bureaucracy and red tape, and no to sending our manufacturing jobs to China and India. We say ‘yes' to an all-of-the-above domestic energy policy, which includes nuclear, clean coal, natural gas, wind, solar, and geothermal. We say ‘yes' to greater access to all sources of clean and reliable energy right here at home."

Of significant importance in the Administration's testimony and response to questions: (1) Secretary Salazar said that 29% of the U.S. electrical need could be supplied from solar power. (2) In response to sharp criticisms from Senators Inhofe and John Barrasso (R-WY), Administrator Jackson formally dispelled the notion that U.S. EPA was suppressing important internal expert opinion on the science of climate change [See WIMS 7/6/09 & See WIMS 6/29/09]. (3) Secretary Chu indicated his support for developing additional nuclear power which were strongly encouraged by Republican Senator Lamar Alexander (R-KY) and Democrat Thomas Carper (D-MD).

Access the EPW hearing website for links to all testimony and a webcast when available (click here). Access the opening statement from Senator Inhofe (click here).

Political Realities & Climate Change Legislation

Jul 6: With just 153 days until the historic Copenhagen meeting to address global climate change and a successor international treaty to the Kyoto Protocol, the intensity of the climate change debate is heating up. In the background of this intense debate is a global recession that has financially crippled countries around the world and many states here at home; as well as bitter differences between Republicans and Democrats regarding the basic science of global warming and actual need for any agreement.

Just last week Republicans launched a major campaign against Democrats that voted for the narrow passage of Waxman-Markey, American Clean Energy and Security Act (ACES, H.R. 2454). The National Republican Congressional Committee (NRCC) is calling the bill "Nancy Pelosi’s devastating National Energy Tax." They claim "Democrats are forcing an extreme agenda of more spending, more taxes, and less jobs. In the midst of a severe economic recession, Nancy Pelosi and her puppets are inflicting further damage on our economy with a job-killing national energy tax."

On the international level, the G-8 meeting in Italy later this week along with the Major Economies Forum on Energy and Climate (MEF) at the leadership level will address the climate change issue, and in the U.S. Senate, the Senate Environment and Pubic Works Committee, Chaired by Senator Barbara Boxer (D-CA) will begin debating climate change legislation tomorrow (July 7). Even with a new 60 vote majority in the Senate, Democrats know it will be an uphill battle to get legislation through the Senate [See WIMS 3/26/09].

A recent opinion piece by the Worldwatch Institute sheds light on some of the political dynamics. Worldwatch indicates that, "With few exceptions, current national goals for cutting greenhouse gas emissions are weak and typically push action to the distant, rather than the near, future. Although part of the environmental community has responded critically, other groups claim that more stringent climate action is simply not politically feasible -- and that asking for more risks the collapse of any climate deal."

For example, "The Obama administration's chief climate negotiator, Todd Stern, has rejected calls for industrialized countries to cut their emissions by 40 percent below 1990 levels by 2020. He not only opposed such cuts as 'not feasible' for the United States, but strikingly judged them as 'unnecessary.' ACES is muddying the waters by pegging reductions to 2005, rather than to the internationally recognized benchmark of 1990. The reason seems clear: given the strong growth of U.S. emissions in the interim, proposed reductions of 17 percent relative to 2005 look much better than the measly 4 percent relative to 1990."

Yet, despite the inadequacies of Waxman-Markey claimed by environmental organizations and many developing countries, U.S. Senator James Inhofe (R-OK), Ranking Member of the Senate Environment and Public Works (EPW) Committee, and outspoken critic of global warming science indicates that the ". . .razor thin vote in the House spells doom in the Senate. Despite a large Democratic majority in the House, and the fact that this is one of the President's top priorities, the Democratic leadership was forced to do everything possible to get a bill passed. Their slim victory could come at a high price -- this is the BTU tax all over again. . . with the economy in a deep recession, it is hard to believe that many more senators would support legislation that would strangle any hope of economic recovery and impose the largest tax increase in American history."

As the Senate debate begins, many questions remain about whether an international or U.S. agreement on climate change -- , even an inadequate one -- is politically feasible. Worldwatch warns in its State of the World 2009 report, that "fossil carbon dioxide emissions will need to come close to zero by 2050 -- decades earlier than what most governments envision -- and that deforestation needs to end well before 2030. The longer we delay serious action, the greater the danger of reaching destabilizing tipping points."

At the same time that some are issuing dire warnings, key House and Senate Republicans like Representative Joe Barton (R-TX), Ranking Member of the House Energy and Commerce Committee and Senator Inhofe, Ranking Member of the EPW are questioning the basic science of global warming. Barton says, "The science is not there to back it up." And, he has recently pressed EPA to formally release a report, released in draft by the Competitive Enterprise Institute (CEI), which he says, "has been suppressed" and "was never made a part of the record, that we are trying to get as we speak that raises grave doubts about the endangerment finding. . ." [See WIMS 6/29/09] Barton quotes from the document saying, "There is strong possibility that there are some other natural causes of global temperature fluctuations that we do not yet fully understand and which may account for the 1998 temperature peak… This possibility needs to be fully explained and discussed. . ."

Amidst these intense political differences, the Senate EPW will begin its debate on legislation on July 7 at 10:00 AM. Scheduled to testify are top Administration officials including: Steven Chu, Secretary of the Department of Energy; Lisa Jackson, Administrator U.S. EPA; and Tom Vilsack, Secretary of the Department of Agriculture. Also, scheduled to testify are representatives from: The Dow Chemical Company; Natural Resources Defense Council; the Mayor of Braddock, Pennsylvania; and Haley Barbour the Governor of Mississippi.

Access the opinion piece from Worldwatch with links to related information (click here). Access a release from the NRCC with links to the various forms of ads (click here). Access the G8 2009 meeting website (click here). Access a release from Sen. Inhofe (click here). Access a release from Rep. Barton (click here). Access a lengthy release from Rep. Barton with further information (click here). Access the June 26 release from CEI and link to the draft report and the earlier release on emails (click here). Access the EPW hearing website for links to all testimony and a webcast when available (click here).

EPA Proposes Stringent Standards for Ocean-Going Ships

Subscribers & Readers Note: WIMS will not be publishing tomorrow, Friday, July 3, 2009, which is the official Federal observance for the Fourth of July holiday. We will resume publishing on Monday, July 6, 2009.

Jul 1: U.S. EPA announced the its next steps in a coordinated strategy to "slash" harmful emissions from ocean-going vessels. EPA is proposing a rule under the Clean Air Act that sets tough engine and fuel standards for U.S. flagged ships that would harmonize with international standards and lead to significant air quality improvements throughout the country.

EPA Administrator Lisa Jackson said, “These emissions are contributing to health, environmental and economic challenges for port communities and others that are miles inland. Building on our work to form an international agreement earlier this year, we’re taking the next steps to reduce significant amounts of harmful pollution from getting into the air we breathe. Lowering emissions from American ships will help safeguard our port communities, and demonstrate American leadership in protecting our health and the environment around the globe.”

The rule comes on the heels of a key part of EPA’s strategy, a proposal last March [See WIMS 3/30/09] by the United States and Canada to designate thousands of miles of the two countries’ coasts as an Emission Control Area (ECA). The International Maritime Organization (IMO), a United Nations agency, begins consideration of the ECA plan this month, which would result in stringent standards for large ships operating within 200 nautical miles of the coasts of Canada and the United States.

According to EPA, air pollution from large ships, such as oil tankers and cargo ships, is expected to grow rapidly in line with port traffic increases. By 2030, the domestic and international strategy is expected to reduce annual emissions of nitrogen oxides (NOx) from large marine diesel engines by about 1.2 million tons and particulate matter (PM) emissions by about 143,000 tons. When fully implemented, the coordinated effort would reduce NOx emissions by 80 percent and PM emissions by 85 percent compared to current emissions.

The emission reductions from the proposed strategy would yield significant health and welfare benefits that would span beyond U.S. ports and coastlines, reaching inland areas. EPA estimates that in 2030, this effort would prevent between 13,000 and 33,000 premature deaths, 1.5 million work days lost, and 10 million minor restricted-activity days. The estimated annual health benefits in 2030 as a result of reduced air pollution are valued between $110 and $280 billion at an annual projected cost of approximately $3.1 billion -- as high as a 90-to-1 benefit-to-cost ratio.

The proposed rulemaking is designed to reflect the IMO’s stringent ECA standards and broader worldwide program. The rule adds two new tiers of NOx standards and strengthens EPA’s existing diesel fuel program for these ships. It represents another milestone in EPA’s decade-long effort to reduce pollution from both new and existing diesel engines under the National Clean Diesel Campaign.

Environmental groups praised the action. Elena Craft, Environmental Defense Fund (EDF) Air Quality Specialist said, "Ships are floating smokestacks that deliver soot and smog straight to the heart of our most crowded coastal cities, home to 87 million Americans, so we are very pleased with this most recent action. Here in Houston for example, we urgently need improved clean air standards to protect the kids and families hard hit by pollution delivered by more than 8,000 vessels visiting our port every year."

In a related matter, beginning July 1, 2009, California will require ocean-going vessels to switch to progressively cleaner fuels despite a legal challenge mounted by the Pacific Merchant Shipping Association (PMSA). On Jun 30, the Eastern District of California denied PMSA’s motion for summary judgment, which if granted, would have derailed clean fuel rules designed to significantly reduce toxic emissions from ships that visit California’s ports. The Natural Resources Defense Council (NRDC) and Coalition for Clean Air are defendant-intervenors in the lawsuit PMSA filed on April 27, 2009.

The landmark low-sulfur fuel regulations adopted by the California Air Resources Board (CARB) begin implementation with a second deadline on January 1, 2012 to require that all ocean-going vessels entering California ports switch to progressively cleaner fuels starting at 24 miles from California’s coast. Air pollution produced by ocean-going vessels exposes 80 percent of Californians to significant cancer risk and is responsible for claiming the lives of thousands of Californians annually and sickening hundreds of thousands across the state, according to NRDC.

NRDC explains that ocean-going vessels are very large and include large cargo vessels such as container vessels, tankers, bulk carriers, and car carriers, as well as passenger cruise vessels. The main engines on these vessels are as tall as a five story building and weigh 1,500 tons; they produce enough energy to power 30,000 houses. Ocean-going vessels typically use low-grade “bunker fuel.” Such fuel contains an average of about 25,000 parts per million (ppm) sulfur, as opposed to diesel fuel for trucks and other motor vehicles, which is limited to 15 ppm sulfur.

Access a release from EPA (click here). Access EPA's Ocean-Going Vessels website for extensive information on the proposed regulations (click here). Access the IMO website for additional information (click here). Access the EPA docket for this rulemaking for background documents and reviewing and submitting comments (click here). Access a release from EDF (click here). Access a release on the CARB case from NRDC (click here).

EPA Issues "California Waiver" For Vehicle GHG Controls

Jun 30: After years of intense legal and political wrangling, U.S. EPA is granting California’s waiver request enabling the state to enforce its greenhouse gas emissions standards for new motor vehicles, beginning with the current model year. EPA said, "Using the law and science as its guide, EPA has taken this action to tackle air pollution and protect human health."

EPA Administrator Lisa Jackson said, “This decision puts the law and science first. After review of the scientific findings, and another comprehensive round of public engagement, I have decided this is the appropriate course under the law. This waiver is consistent with the Clean Air Act as it’s been used for the last 40 years and supports the prerogatives of the 13 states and the District of Columbia who have opted to follow California’s lead. More importantly, this decision reinforces the historic agreement on nationwide emissions standards developed by a broad coalition of industry, government and environmental stakeholders earlier this year.”

The first California waiver request was made in December 2005 and was subsequently denied in March 2008. This previous decision was based on a Bush-era interpretation of the Clean Air Act finding that California did not have a need for its greenhouse gas emission standards to meet “compelling and extraordinary conditions.” California made its request for a waiver of federal preemption under CAA Section 209(b), to permit enforcement of the State's new motor vehicle emission standards to control greenhouse gas emissions adopted in September 2005. The State subsequently submitted its waiver request to EPA in December that year.

Shortly after taking office in January, President Barack Obama directed EPA to assess the appropriateness of denying the waiver. EPA received a letter from California on January 21, 2009, raising several issues for Administrator Jackson to review regarding the denial. Last month, President Obama announced a first-ever national policy aimed at both increasing fuel economy and reducing greenhouse gas pollution for all new cars and trucks sold in the United States [See WIMS 5/19/09]. The new standards would cover model years 2012-2016. When the national program takes effect, California has committed to allowing automakers who show compliance with the national program to also be deemed in compliance with state requirements.

In a release, EPA indicated that with the decision to grant the California waiver, the Agency returns to its traditional legal interpretation of the Clean Air Act that has been applied consistently during the past 40 years. EPA finds that California continues to have a need for its motor vehicle emissions program, including the greenhouse gas standards. EPA also finds that the California program meets legal requirements regarding the protectiveness of public health and welfare as well as technological feasibility.

EPA said it based its decision on an extensive record of scientific and technical evidence. As part of the reconsideration, EPA revisited the prior decision documents and record. The Agency also opened a new comment period, including public hearings. The Clean Air Act gives EPA the authority to allow California to adopt its own emission standards for new motor vehicles due to the seriousness of the State’s air pollution challenges. There is a long-standing history of EPA granting waivers to the State of California.

California Governor Arnold Schwarzenegger issued a statement on EPA's action saying, "After being asleep at the wheel for over two decades, the federal government has finally stepped up and granted California its nation-leading tailpipe emissions waiver. This decision is a huge step for our emerging green economy that will create thousands of new jobs and bring Californians the cars they want while reducing greenhouse gas emissions. Thanks to the environmental commitment of President Obama and the continued leadership of state Senator Fran Pavley, California's long battle to reduce pollution from passenger vehicles is over, and a greener, cleaner future has finally arrived."

California is the only state under the Federal Clean Air Act, with the unique ability to set stricter-than-Federal standards for vehicles, as long as it gets a waiver from the Federal government. Once California receives a waiver from the Federal government, then other states can choose to adopt California's cleaner standards. Thirteen other states and the District of Columbia have adopted California's clean car standards. The thirteen other states, as of January 21, 2009, that have adopted California's standards include: Arizona, Connecticut, Maine, Maryland, Massachusetts, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, Vermont and Washington.

The California release includes comments from a number of the other state Governors. For example: Vermont Governor Jim Douglas said, "The Obama Administration's decision to grant California a waiver for its standards restricting greenhouse gas emission from motor vehicles is a significant step in the right direction for Vermont and other states that adopted these standards. My commitment to reducing carbon emissions in Vermont is longstanding as Vermont has been fighting to join California in adopting these standards for some time now. . . Auto emissions are one of the main contributors to greenhouse gas concentrations. This is particularly true in Vermont where the transportation sector accounts for approximately 45 percent of our carbon footprint. That is why reducing an emission from automobiles is so important here in Vermont."

U.S. Senator Barbara Boxer (D-CA), Chairman of the Senate Committee on Environment and Public Works issued a statement saying, "The granting of this waiver will unleash innovative technologies that will create millions of clean energy jobs as we move toward new cleaner and more efficient vehicles. It should be comforting to the American people to know that the Environmental Protection Agency is now putting science and the law back into the driver’s seat rather than politics and special interests. I commend the Obama Administration for doing what is right for the people of California, the environment and the many states in the union that intend to follow California’s lead in cleaning up tailpipe emissions.”

Dave McCurdy, president and CEO, Alliance of Automobile Manufacturers (AAM) said, "President Obama’s decision last month to create a single national program for greenhouse gas emissions and fuel economy standards moves us toward a policy that ensures that consumers in all 50 states have access to highly fuel-efficient vehicles at an affordable price. We are hopeful the granting of this waiver will not undermine the enormous efforts put forth to create the national program. The President has succeeded in bringing three regulatory bodies, 15 states, a dozen automakers and many environmental groups to the table. The national program has launched a new beginning, a new chapter and a new era of cooperation. Automakers remain committed to working with all parties to further this single national program administered by the federal government."

AAM reported that EPA and the National Highway Traffic Safety Administration (NHTSA) have initiated efforts to issue a joint rulemaking that is intended to reflect a coordinated and harmonized approach to implementing the Clean Air Act and the Energy Policy and Conservation Act. The rulemaking is expected to begin shortly and be concluded by March 30, 2010 and will apply to vehicles from MY 2012-2016.

James Fine, economist and policy scientist at Environmental Defense Fund (EDF) said, "Cleaner cars are a trifecta that will save families money at the gas pump, reduce our dependence on foreign oil, and cut global warming pollution from tailpipes." EDF issued a new report, Saving Fuel, Saving Money, Saving Our Climate, that compares automobile fleets under two scenarios for years 2010 through 2030. The first scenario is based on current and projected Federal Corporate Average Fuel Economy (CAFÉ) standards. The second scenario is based on implementation of California's vehicle greenhouse gas performance standards (i.e., Clean Car Standards) through 2020, with continued progress through 2030. The Clean Car Standards can be achieved using existing technologies, including: alternative fuels, advanced tire technology, engine adjustments and improved air conditioning systems. Fine said, "This study shows that once these standards go into effect in these states, drivers will save billions of dollars, while dramatically reducing global warming pollution from tailpipes, one of the major sources of global warming pollution."

Access a release and audio clips from U.S. EPA (click here). Access EPA's CA Waiver website for extensive background information (click here). Access a release from Gov. Schwarzenegger that includes comments from other Governors (click here). Access a release from Sen. Boxer (click here). Access a release from AAM (click here). Access a release from EDF and link to the report (click here). For background information on the historical controversy see numerous WIMS-eNewsUSA blog posts (click here).