Issues to Watch: 2007

Jonathan Lash World Resources Institute

December 19, 2006

5 ISSUES TO WATCH

• Prospects for Climate Legislation

• Climate and Energy in the Agriculture Bill

• Chesapeake Water Quality Initiative

• New Science and Technology

• International Process

Congressional Action?

Lessons from the 2006 Election:

REPORT: November 17, 2006 A New Energy Future

“Campaign ads highlighted energy issues in a prominent and unprecedented way this election cycle and had a huge impact on the campaigns.”

“Congress should pass legislation promoting renewables and alternative energy sources as an effective way to reduce global warming pollution.”

More than 75 percent [of voters in the 2006 elections] said they agreed with the following statement:

Majorities in all demographics said lawmakers should support to the two solutions, including 53 percent of self-described conservatives and nearly 37 percent of self-described “very conservative” voters.

August 28, 2005

Photo Credit: NASA/Jeff Schmaltz, MODIS Land Rapid Response Team

Hurricane Katrina

Growing PublicConcern in US

CALIFORNIA• Global Warming Solutions Act

(signed September 27, 2006):

– Caps California’s greenhouse gas emissions at 1990 levels by 2020.

– Requires State Air Resources Board to establish, monitor, and enforce compliance for statewide greenhouse gas emissions reporting program.

– Authorizes state board to adopt market-based compliance mechanisms including cap-and-trade.

• Goal: A regional cap-and-trade program initially covering CO2 emissions from power plants

– Stabilize emissions at base levels through 2014

– Reduce by 10% by 2018• Region statistics:

– 7 states represent 7% US total GHG emissions

1.5% of world GHG emissions ( Australia, rank 15th)

• Other states: – MD (signed; expected to implement

under new governor)– MA (expected to rejoin under new

governor)

Regulating U.S. Emissions in Northeast

50% of electricity sales subject to Renewable Portfolio Standards (RPS) / Renewable Energy (RE) goals

Goals in placeRPS in effect

20 states + D.C. with RPS 3 states w/ goals

Source: database of state incentives for renewable energy (2006)

12 states adopting California GHG rules;number of new car registrations (thousands of vehicles), 2005

409

2,145

169

286

701

864

609

20559

372

60

39

Source: National Automobile Dealer Association 2006;

36% of U.S auto market set for GHG rules

Energy Efficiency

Coal-based Synfuels with CCS

Wind power

Reforestation

Mass transit

Tomorrow’s Markets

Carbon Capture & Storage

Adapted from:

Robert Socolow, www.princeton.edu/~cmi

Biofuels

GHG Reducing Products and Services

Andy RubenVice President of Corporate Strategy/Sustainability,Wal-Mart Stores, Inc.

Michael Murray,Director, Legislative Policy,Sempra Energy

Garth EdwardTrading Manager, Environmental Products,Shell Group

Jeff SterbaChairman, President and CEO,PNM Resources

David SlumpGeneral Manager, global marketing, GE Energy,General Electric Co.

Elizabeth A. MolerExecutive V.P., Government and Environmental Affairs &Public Policy,Exelon Corp.

Ruth ShawGroup Executive, Public Policy and President, Duke Nuclear,Duke Energy Corp.

Senate Committee: Environment and Public Works109th Congress

Republicans:

•James Inhofe, Committee Chair (OK)

•John Warner (VA)

•Christopher Bond (MO)

•George Voinovich (OH)

•Lincoln Chafee (RI)

•Lisa Murkowski (AK)

•John Thune (SD)

•Jim DeMint (SC)

•Johnny Isakson (GA)

•David Vitter (LA)

Democrats:

•James Jeffords, Minority leader (VT)

•Max Baucus (MT)

•Joseph Lieberman (CT)

•Barbara Boxer (CA)

•Thomas Carper (DE)

•Hillary Rodham Clinton (NY)

•Frank Lautenberg (NJ)

•Barack Obama (IL)

Incumbent replacements for 110th Congress:

Sheldon Whitehouse (D-RI)

Bernard Sanders (I-VT)- New Committee Chair

- Will not be serving in 110th Congress

http://fr.wikipedia.org/wiki/Image:Barack_Obama_portrait_2005.jpg

CARS and COAL

American Electric Power, Zimmer Coal Plant,

Moscow, Ohio

Global Markets

Can We ReduceGHGs and StillCompete Globally?

In the last 10 years the United States has consumed approximately 72.4 billion barrels of oil. More than 50% of that was imported.

* Based on data from the Energy Information Administration (EIA) Report: Short-Term Energy Outlook, December 12 , 2006 Release

Source: DOE, Office of Energy Efficiency and Renewable Energy

Number of Gas Stations that carry E85

If the entire acreage under corn production in the United States (80 million acres) were turned over to ethanol production, it would only account for one eighth of current gasoline demand.

*Data from World Resources Institute

Dead Zones

Source: Millennium Ecosystem Assessment

Chesapeake Bay Watershed

No dispute among scientific bodies…

Year Body Statement

2001 Intergovernmental Panel on Climate Change (IPCC)

“There is new and stronger evidence that most of the warming observed over the last 50 years is attributable to human activities.”

2001 U.S. National Academy of Science

“Greenhouse gases are accumulating in Earth's atmosphere as a result of human activities, causing surface air temperatures and subsurface ocean temperatures to rise.”

2003 American Geophysical Union “Human activities are increasingly altering the Earth's climate. … Scientific evidence strongly indicates that natural influences cannot explain the rapid increase in global near-surface temperatures observed during the second half of the 20th century.”

2003 American Meteorological Society “There is now clear evidence that the mean annual temperature at the earth’s surface, average over the entire globe, has been increasing in the past 200 years. There is also clear evidence that the abundance of greenhouse gases in the atmosphere has increased over the same period.”

2004 American Association for the Advancement of Science

no "substantive disagreement in the scientific community" that anthropogenic global warming is happening.

2005 Science academies of Brazil, Canada, China, France, Germany, Great Britain, Italy, Japan, Russia, U.S., India

Joint statement: "There is now strong evidence that significant global warming is occurring… It is likely that most of the warming in recent decades can be attributed to human activities. This warming has already led to changes in the Earth's climate."

2006 U.S. Climate Change Science Program

"clear evidence of human influences on the climate system."

Financial Times – December 2006

AP Photo

A Different Kind ofHot TimesOn theSlopes

Source: Science Magazine, Sep 16, 2005

Risk, for species diversity, wetlands, and coastal zones significantly increases when temperatures rise above 2º C

Hare, 2005; Potsdam Institute for Climate Impact Research

Cellulosic Ethanol Pilot Plant

Thin-film solar cells

Supercapacitor with Nanotechnology

Coal Gasification to Produce SNG

(North Dakota, USA)

(Sou

rce:

Dak

ota

Gas

ifica

tion

Petcoke Gasification to Produce H2(Kansas, USA)

(Sou

rce:

Che

vron

-Tex

aco)

Examples of Pre-CombustionCO2 Capture Systems

Venture capital flows to clean technology companies

0

100

200

300

400

500

600

700

800

900

1,000

1Q/04 2Q/04 3Q/04 4Q/04 1Q/05 2Q/05 3Q/05 4Q/05 Q1/06 Q2/06 Q3/06

Source: C leantech Venture Network

4%

6%

8%

10%

12%

14%

16%

18%

Clean Technology Venture Capital

% Overall Venture Capital

US R&D Expenditures 1981 - 2005

0

500

1000

1500

2000

2500

3000

350019

81

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Year

$ M

illi

on

GROUP 1: ENERGY EFFICIENCY

GROUP II: FOSSIL FUELS

II.3 Total CO2 Capture and Storage

GROUP III: RENEWABLE ENERGY SOURCES

GROUP IV: NUCLEAR FISSION and FUSION

GROUP V: HYDROGEN and FUEL CELLS

GROUP VI: OTHER POWER and STORAGE TECHS

GROUP VI: TOTAL OTHER TECH./RESEARCH

Source: IEA R&D database http://www.iea.org/Textbase/stats/rd.asp

The Key is Top 25

S. Arabia

Top 25 in Emissions(80% World GHG Total)

Top 25 in Population Top 25 in GDP

USA, China, (EU25), Russia, India, Japan, Germany, Brazil, UK, Italy, Mexico, France,

Indonesia, Iran, Turkey

(68% World GHG Emissions)

Congo Ukraine, Pakistan

Canada, S.Korea, Australia, S.Africa, Spain, Poland, Argentina

Netherlands, (Taiwan)

Thailand

Bangladesh, Nigeria, Viet Nam, Philippines, Ethiopia, Egypt,

Source: WRI/CAIT

European Climate Exchange Futures and Contracts

Price and Volume

“China overtakes the United States as the world’s biggest emitter before 2010.”

-World Energy Outlook 2006 International Energy Agency

Per Capita Emissions, 2000