In an unheralded move earlier this year, an interagency group of technical experts coordinated by the Office of Management and Budget and the Council of Economic Advisors finalized a revised estimate of an important numerical value used in federal regulatory cost/benefit analyses to represent the cost to society of carbon-based greenhouse gas emissions. The new value increased the “social cost of carbon” from the previous level (established in 2010) of $23.80 to $38 per metric ton of carbon dioxide (CO2) emissions, in some cases doubling the estimated benefit of carbon reduction initiatives. The new factor appeared in the cost-benefit justification for a DOE energy efficiency rulemaking in May 2013 and immediately sparked controversy. Critics charged the new value had been adopted without the benefit of peer review or public comment and that it was too high, which would make it easier for the Administration to justify costly new climate change regulations. Opponents in Congress convened hearings and proposed legislation to compel a review.
After months of furor, the newly confirmed Administrator of the OMB Office of Information and Regulatory Affairs, Howard Shelanski, announced November 1 that the new value would be adjusted slightly downward to $37, due to technical corrections, and also solicited comments on the estimate. A Federal Register notice with a comment deadline is expected imminently. Technical information on the derivation of the new Social Cost of Carbon is available here.
Jane C. Luxton, Esq.
Regulatory efforts designed to implement the President’s Climate Action Plan, previously discussed in this blog, continue to emerge. Earlier this month, the President issued an executive order directing federal agencies to support investments and other actions by states, local communities, and tribes that increase the nation’s resilience to climate-change related impacts. The order highlights promotion of “the dual goals of greater climate resilience and carbon sequestration, or other reductions to the sources of climate change” in its call to action. Some observers are already seeing the potential for increased federal regulatory activism, for example on siting and construction requirements, based on climate change factors.
Under the order, the Departments of Defense, Interior, and Agriculture, EPA, NOAA, FEMA, and the Army Corps of Engineers must report to OMB within nine months on an inventory and assessment of proposed and completed changes to their policies, programs, and regulations needed to enhance national resiliency, including a timeline for implementing these changes. The order also requires all federal agencies to create climate adaptation plans to ensure their ability to carry out their missions despite potential climate change events. In addition, the order creates a 30+ agency Council on Climate Preparedness and Resilience to work with state, local, and tribal governments to coordinate efforts on climate change resilience and preparedness.
In a release the same day as the executive order, EPA published 17 Adaptation Implementation Plans, one from each EPA regional and program office. Each of the plans is far-ranging and detailed, and those affected by EPA regulations should take a close look. Comments are due by January 4, 2014.
Jane C. Luxton, Esq.
Posted in Climate Change
In late October 2013, the Department of Energy’s Energy Information Administration (EIA) announced that it would begin the monthly publication of a Drilling Productivity Report on U.S. shale oil and gas production. The new DPR will provide information initially for the six major shale oil and gas fields: the Marcellus, Haynesville, Eagle Ford, Permian, Nobrara, and Bakken basins. According to the EIA, “these six regions accounted for nearly 90% of domestic oil production growth and virtually all domestic natural gas production growth during 2011-12.”
Reported data will include rig efficiency, new well productivity, decline rates at previously existing wells, and overall production trends. A copy of the full report is available here. The next report will be issued November 12.
Jane C. Luxton
Today in Hobart (Tasmania), at its annual meeting, the Commission for the Conservation of Antarctic Marine Living Resources (CCAMLR) failed in its third attempt to adopt proposals that would have established the world’s largest marine protected area (MPA) in Antarctica’s Southern Ocean. On the agenda were two proposals: One sponsored by the U.S. and New Zealand to establish a 1.32 million km no-take zone in the Ross Sea; the other was a proposal from Australia, France and the EU for a 1.6 million km East Antarctic MPA network.
The proposals were the subject of an historic special meeting of CCAMLR in July held in Germany after CCAMLR failed to reach unanimity of its members at the 2012 annual meeting.
CCAMLR is comprised of 24 nations and the EU. Unanimity is required to adopt any proposal concerning preserves. Only Russia and the Ukraine actively blocked negotiations in favor of the proposals, while China withdrew its support for the East Antarctic MPA.
The controversy pits environmentalists, scientists and researchers against the commercial toothfish (a/k/a “Chilean Sea Bass”) industry. In addition to conservation efforts to protect the over 10,000 unique species that make their home in the Southern Ocean, scientists cite the region as crucial to studying how intact marine ecosystems function and to determine the impacts of global climate change.
The proposals were supported by the Antarctic Ocean Alliance, the Pew Charitable Trust, the Southern Ocean Coalition and became the focus of several social media efforts.
The failure of the proposals leaves some questioning CCAMLR’s ability to fulfill its raison d’etre of conserving the Antarctic marine ecosystems.
Consuelo Alden Vasquez, Esq.
In its recently published 13th survey of trends in the global power sector, PwC reported a strong consensus that the spread of distributed energy generation, including solar and other renewables, is transforming the business model for the power sector. 94% of power sector CEOs from all regions who completed the 2013 survey predicted “complete transformation” or “important changes” between now and 2030, with 90% of North American respondents in agreement. Continue reading