The history of US per-capita petroleum consumption will surprise you.

I'm participating in a forum about global warming, which raises all the usual questions about how much US petroleum consumption has contributed and is contributing, whether US policies have done too little to discourage petroleum use, and whether a "carbon price" would finally fix that aspect of the global warming problem. To try to anchor that discussion in some facts, I found the following graph illustrating two facts that are counterintuitive for most of us: First, US per-capita consumption of petroleum has been very stable since 1983. Second, consumption has fluctuated only slightly with retail price changes, even the dramatic price spike of 2007 and 2008.

(Hat tip to Elliott H. Gue at Investing Daily.)  Total US petroleum consumption peaked at 18.85 million barrels per day (MMBPD) in 1978. It then declined sharply to 15.23 MMBPD under the influence of the Iranian oil embargo, CAFE standards, and a deep recession. Then total consumption rose slowly to 20.80 MMBPD in 2005 and has declined since. (Data on total consumption from EIA.) EIA estimates that US petroleum consumption will increase only 11% from 2008 to 2005 2035 [corrected 12/15/2010], which means per-capita consumption will continue to decline at a modest rate.

CBO says this projected [amended 12/17/2010] decline is due to the new CAFE standards and that a price increase of $2.00 per gallon would not further constrain consumption. To put that in political context, the President's Bowles-Simpson Deficit Commission proposed a $0.15/gallon gasoline tax increase, and the cap/trade bill that passed the House would limit the carbon price to about $25/ton of CO2, which would be only $0.25/gallon of gasoline.

In conclusion, the US has been better at managing petroleum consumption than probably most people think, and still further improvements will not be easy, cheap, or politically palatable.

Update on Tuesday, December 21, 2010 at 09:15AM by Skeptic

In contrast to EIA's projected 11% increase in US petroleum consumption by 2035 is the projection of Cambridge Energy Research Associates that US gasoline consumption will decrease at least 20% by 2030.  Other government and industry officials, including the CEO of EXxon-Mobil, agree. AP has the story here. 

Update on Friday, January 28, 2011 at 03:23PM by Skeptic

Exxon Mobil's latest long-term forecast projects (at 18) a 20% overall decline in US passenger car gasoline consumption by 2030--even with more people and more cars--because of increasing fuel efficiency. 

Update on Friday, May 13, 2011 at 11:26AM by Skeptic

The steep decline in per-capita crude oil consumption from 1978 to 1983 was primarily due to reduced consumption in the residential/commercial, industrial, and utility sectors, as is clearly shown by the following graph from EIA. Clearly, those declines were not due to gasoline prices.  There were a lot of new regulations in those days mandating energy efficiency and forcing a phase-out of petroleum fuels for electricity generation. During these five or six years the non-transportation uses of petroleum shrank from 47% of total consumption to 38% (and are now down to 36%).

Save the planet by NOT burning biomass.

[Corrected 7/15/10 at 0952.]

One of the things we all "know" about global warming is that if we burn "renewable" biomass instead of coal, we can have clean energy that does not contribute to global warming. I've been suspicious about that, and then last week this caught my eye: Massachusetts is revising its rules to disallow to certain biomass combustion plants "green credits" toward the Commonwealth's goal of reducing its carbon footprint. I decided to do some calculations, and it turns out that burning dead trees and some other biomass sources does not necessarily reduce CO2 emissions and may actually increases them, at least in the short term. It's all about inventories of sequestered CO2, as I'll explain.

Assume we have a self-renewing "forest" of 40 trees, each of which sprouted in a different year and each of which will die on its 40^th birthday (sproutday?). Assume further that each tree grows at a linear rate and incorporates into its structure 5 tons of CO2 by the day it dies, i.e., 250 pounds per year. Finally, assume that Uupon its death, each tree decays at a linear rate of 500 pounds per year, with the assistance of termites, fungi, and other critters, and 20 years after its death has released all of its CO2 back to the atmosphere. Thus, while our forest is in this steady state, we have 40 live trees containing an average of 2.5 tons of CO2 each, for a total of 100 tons, and 20 dead trees each containing an average of 2.5 tons of CO2, another 100 50 tons. Our little forest keeps sequestered, year after year, 200 150 tons of CO2.

Now, let's build a biomass combustion facility at the edge of our forest. Each year we will harvest the tree that died that year and burn it to produce electricity, releasing 5 tons of CO2 to the atmosphere. The trees that died in prior years go on naturally decomposing, but after 20 years they are all gone, and 100 50 tons of CO2 formerly sequestered in our stock of dead trees is all back in the atmosphere. After that, burning each tree as it dies will not further increase the amount of CO2 in the atmosphere, because the rest of the forest assimilates 5 tons per year of CO2. However, to get to that new steady state we will have destroyed the 100 50-ton CO2 dead-tree sink, the same size as the one in our live trees. The planet will be worse off by 100 50 tons of CO2.

Would the planet nevertheless be better off if the wood burning backed out some coal combustion? That would clearly be true in the 21^st and later years after loss of the dead-tree CO2 sink, but what about during those first 20 years? When wood is burned, it releases less energy than coal because the carbon in wood is already "partially oxidized" from pure C to cellulose, a polymer of glucose (C6 H10 O5) units. Wood pulp has a higher heating value of 7,510 Btu/lb and will release 1.630 lbs of CO2 (1 x 264/162). Pure carbon, which is responsible for nearly all the energy content in coal, yields 14,500 Btu/lb and releases 3.667 lbs of CO2 (1 x 44/12). Thus, burning wood releases 86% as much CO2 as burning coal for the same energy output, not a very big advantage. (By similar calculations, one can show that burning natural gas is far better for the planet in the short term than burning dead trees, because natural gas releases only about 56% as much CO2 per unit of energy as does coal.)

One general lesson to take away from this model is that, in steady-state conditions, there may be as much CO2 sequestered in dead biomass as in live biomass—as in any plant the CO2 content goes from zero to maximum and then back to zero. (If the growth and/or decay processes are non-linear, the two sectors may not have exactly equal CO2 content.) The dead tree sink could be either larger or smaller than the live-tree sink, depending on rates of growth and decay which, of course, are probably not linear.  I assume tree decay is relatively rapid in the tropics and relatively slow in high latitudes. My impression (only an impression—I haven't done my homework on this) is that some folks consider only the CO2 content of live biomass in their efforts to show project benefits. Oh, and here's another counter-intuitive fact: Turning trees into lumber and incorporating them into long-lived structures may be better for the planet than letting the trees die and decay more quickly in their natural habitats.

This analysis does not necessarily indict every "biomass" project. For example, if barren desert were covered with tanks of cultivated algae to produce biofuels, there would be no destruction of existing sinks of CO2, and the process could be very "climate friendly" if it displaced fossil fuels. However, one should perhaps compare that project with providing water to the area to develop a self-sustaining forest as a CO2 sink, which might be an even better way to slow down global warming. I mean only to show that one cannot assume biomass projects are climate friendly—you have to do your homework and get the accounting right. Heads up to my friends in northern Michigan: Traverse City Power & Light is moving ahead with two projects based on biomass from trees.

Update on Thursday, October 7, 2010 at 09:44AM by Skeptic

Sequestering CO2 by turning trees into lumber is old technology, but at the University of Illinois they're proposing to turn corn stover into building materials dubbed "CornBoard." 

Update on Monday, November 8, 2010 at 08:42AM by Skeptic

Here's a specific case where growing biofuels may increase CO2 emissions by leading directly or indirectly to clearing and cultivation of wild lands. 

BRUSSELS, Nov 8 (Reuters) – European plans to promote biofuels will drive farmers to convert 69,000 square km of wild land into fields and plantations, depriving the poor of food and accelerating climate change, a report warned on Monday.

The impact equates to an area the size of the Republic of Ireland.

As a result, the extra biofuels that Europe will use over the next decade will generate between 81 and 167 percent more carbon dioxide than fossil fuels, says the report.

Update on Tuesday, July 26, 2011 at 10:55AM by Skeptic

Here is a post on Climate Progress that includes estimates on CO2 sequestration of clear-cutting and replanting forests in order to harvest wood products. It considers CO2 sequestered in dead trees, in dead  trees, and in the wood products.

Update on Saturday, November 30, 2013 at 11:11AM by Skeptic

In 2011, EPA kicked off a rulemaking process to govern how stationary sources account for CO2 emissions when they burn biomass.  Recently 41 scientists organized by NRDC have sent this letter to the rule makers stating that "studies conducted in different regions of the U.S. have found that burning whole trees in conventional, standalone power plants increases carbon emissions relative to fossil fuels for 35 to 100 years or more."  (The delay may not be so long for faster-growing biomass like grasses.)  In addition, the letter states that burning typical biomass with a water content of about 50% emits more CO2 per unit of usable energy than does burning coal. Biomass harvesting processes can also release CO2 from soils. ClimateProgress has a broader discussion here.

The Copenhagen meeting on global climate change failed in part because economists’ blather about “efficiency” distracts from the real issues.

After the failure in Copenhagen to reach an agreement to save the planet, pundits are grappling with the question, "Now what?" Typical are this op ed by Joe Stiglitz and this post by Robert Stavins. I react below to Stiglitz's (perfectly mainstream) suggestion that we proceed by getting every nation to adopt the same "carbon price" (whether by taxes, tradeable permits, or otherwise), and he suggests $80 per ton of CO2. Essentially, I'm saying—for the nth time—that economists don't understand the real world.

In addition to the very real political problems, there is a very practical problem that I guess is too mundane and simple for the pundits, economists, and other policy experts to discuss: At no point in time can there be a single carbon price that makes sense for both coal and petroleum. A carbon price that will kill off coal entirely will make no noticeable dent in petroleum consumption, and we need to reduce both dramatically. Here's the arithmetic.

According to EPA (see Figure ES-6), combustion of fossil fuels in the electricity generation and transportation sectors accounted for 62% of all US CO2 emissions in 2006. (Industry was 19%, and agriculture, commercial and residential were all single digits.) Electricity generation is overwhelmingly a coal problem—accounting for 83% of CO2 emissions from this sector. A ton of typical steam coal contains about 1400 lbs. of carbon, which will turn into 5,133 lbs. (2.57 tons) of CO2. If CO2 is assessed at $80 per ton, the price of a ton of coal would increase by $205. Since the national average coal price was $31.26 in 2008 (EIA link), that price increase would cause electricity generators to close their coal-fired plants as soon as possible and switch to natural gas, renewables, and (maybe) nuclear.

In contrast, $80 per ton for CO2 would raise the price of gasoline by only $0.80 per gallon (a gallon of gasoline generates ~20 lbs. or 1/100 of a ton of CO2). Obviously, that won't discourage use of highway fuels very much even though it would cost $110 billion per year in the aggregate. (EIA says US gasoline consumption is 138 billion gallons per year.) That's almost $1,000 per family per year and almost as much as the AIG bailout, and there's no substantial benefit. According to CBO, even a CO2 price of $191 per ton would not significantly reduce US gasoline consumption, in the short term or the long term, leaving its current 28% contribution to CO2 emissions to continue unabated.

Economists are guilty of setting a "perfect" efficient market-based system at war with "pretty good" solutions for the CO2 emissions problems. The most affordable solution for petroleum is CAFÉ standards (but if we make them as stringent as we need to, we'll have too much refining capacity, not a congenial thought for those still in my former industry). The most affordable and politically possible way to deal with coal may be to buy the mines and turn them into parks because anything else that comes close to making coal uneconomical will result in massive, protracted litigation about compensation for a "regulatory taking." The whole legislative conversation about markets, offsets (preserving rain forests, etc.), and carbon capture and sequestration ("CCS") grows out of the fantasy that we can achieve adequate CO2 emissions reductions without shutting down all coal mines and closing many refineries. We can't. Deal with it.

A version of this post appears as a comment on Mark Thoma's blog here.

Update on Thursday, January 14, 2010 at 08:55AM by Skeptic

From my response to an email correspondent who asks about my calculation of 80 cents per gallon and finds it hard to believe that would not significantly reduce demand:

My 80 cents per gallon calculation is just $80/ton x the CO2 yield of one gallon of gasoline (20 lbs.).  I understand it is recommended that the carbon price be imposed as far upstream as possible for administrative reasons.  I assume that means it would be imposed on the production or importation of crude oil, and at that level $80/ton of CO2 would be about $30-35 per barrel.  If owners of crude oil at various stages have enough market power, they’ll try to pass through not only the carbon price but their additional inventory holding costs, but it’s also possible that the whole carbon price cannot be passed through and that producers will have to offset in the wellhead price some portion of the carbon price.  So how about 80 cents per gallon at the pump plus or minus 20 cents? 

Why would you find it hard to believe 80 cents a gallon would not have significant effect?  Crude oil prices reached $147 in July 2008 and gasoline consumption hardly wavered:  

Distillate volumes varied more because they are used in trucks and other businesses which are more sensitive to economic conditions than consumers. The Great Recession officially started in December 2007 and was depressing consumption even before the oil price peaked. 

But, you might argue, that’s just the short-term effect; when people understand gasoline will always cost 30% more than they’re used to, they’ll opt for more fuel efficient cars when it comes time to trade.  I agree.  But, according to OMB, existing CAFÉ standards are going to cause that result anyway.  The more fuel efficient cars and trucks will presumably cost more, and the gas hogs will presumably cost a lot more so manufacturers can ration them to make their CAFÉ numbers.  Adding artificially high motor fuel prices would presumably push people to choose the same more efficient new vehicles, but they will also be paying more to operate them (nearly $1,000 per year in my calculation).  Also, the prices of new fuel efficient passenger cars should be higher than in the CAFÉ-only scenario because people will want those vehicles more and the gas hogs less. 

I’m not actually opposed to a carbon price on petroleum products.  I’m only opposed to the belief that carbon prices of $50 or $100 or even $200 per ton of CO2 will dramatically reduce the amount of petroleum consumed.  I’ve been following this issue for about three years and have read stuff from lots of carbon price proponents and I’ve never seen any analysis with prices, vehicle miles traveled, MPG, etc. that predicts a big reduction in demand.  It’s all just arm-waving, which is the reason I wrote this post—to try to get policy grounded in some quantified costs and quantified benefits.  Further, squeezing coal out of the mix may INCREASE the demand for distillates, which can after all run gas turbines as well as natural gas.  Having the same CO2 price on petroleum as on coal might help mitigate that tendency, and that would be a reason to do it.  I think reducing US dependence on oil, especially imported oil, should be a priority—not to prevent global climate change but to put our balance of payments more in order and to reduce the vulnerability of our economy to big petroleum price spikes (which always cause recessions).  Reasonable people can disagree about that as a policy goal, but there’s a lot less room for a data-backed argument about the effectiveness of highway fuels prices to achieve that goal, imho. 

Update on Monday, January 18, 2010 at 11:54AM by Skeptic

Trucks and SUVs over 8,500 pounds gross weight including Hummer H-1 and H-2 (H-2 rated 10 mpg city and 14 mpg highway) and Ford Excursions (rated 8-10 mpg city and 12-14 mpg highway) have not been subject to CAFE standards, but the demand for them fell so much when fuel prices began to rise from $1.50 in 2003 to over $3.00 in 2007 that they have been dropped from Detroit's product lineup.  The vast majority of SUVs (including Hummer H-3, Ford Explorers and Expeditions, Cadillac Escalades, and Lincoln Navigators) have been subject to the light truck CAFÉ standards since 1979, and the standards were raised starting in 2004. But even before the CAFE increases could have much effect, there was a shift in buyer preference away from SUVs, toward passenger cars.  (The passenger car market share hit an all-time low of 45% in 2004 and has since climbed back to over 50%, according to CBO.) Therefore, it seems these changes in consumer preferences should be attributed to fuel price changes and only slightly, if at all, to CAFE standards. But the key question is how much these price changes, or additional increases from carbon pricing, will increase fleet fuel economy when consumers have fully reacted to them.

Obviously, increasing fuel prices have a much bigger impact on the  behavior of people who own gas hogs than they do on the owners of fuel efficient vehicles.  If you buy a lot of gas, a small price increase may make a big difference to you on a monthly or annual basis.  If you buy only a few hundred gallons per year, you may be relatively indifferent to price changes.  In other words, the more efficient your current vehicle is, the bigger gasoline price increase will likely be required to motivate you to switch to a more efficient vehicle. Assuming 12,000 miles per year, here's how MPG rating translates into gallons per year and declining impact of price increases with increasing MPG.  

MPG rating	Gallons per year	Annual fuel cost at $2.00 per gallon	Annual fuel cost at $3.00 per gallon	Annual cost increase caused by $1.00 price increase	Could save at $3.00 per gallon by substituting a vehicle that gets 10 MPG more
10	1200	$2,400	$3,600	$1,200	$1,800
20	600	$1,200	$1,800	$600	$600
30	400	$800	$1,200	$400	$300
40	300	$600	$900	$300	$180
50	240	$480	$720	$240	$120
60	200	$400	$600	$200

At 12,000 miles per year, the owner of a (discontinued) Ford Excursion will have to buy about 1,200 gallons of gasoline, whereas the owner of a Cadillac Escalade hybrid (rated 22 MPG) would only need to buy 545 gallons. At $3.00 per gallon, that's a difference of $1,965 per year; at $4.00 per gallon, $2,620 per year. Apparently, tens of thousands of buyers were influenced by economics like that, drying up the market for extreme gas hogs.  To take the next big fuel economy step would involve switching to something much smaller like the Ford Escape hybrid (rated 32 MPG). That would save an additional 170 gallons per year, $510 per year at $3.00 per gallon and $680 at $4.00 per gallon, which is only 26% of the savings of switching from the Excursion to the Escalade.

Going toward the bottom of the table, the owner of a Toyota Prius (rated 46 MPG) uses only 261 gallons of gasoline per year. If that owner switched to a plug-in auto that used no gasoline at all, his/her annual gasoline cost savings would be only $783 at $3.00 per gallon and $1,044 at $4.00 per gallon. In this price range, it's hard to see much incentive for a Prius owner to make that change unless the plug-in auto has identical or more desirable characteristics and is subsidized in some fashion. 

Notes:  The national average gasoline price spiked at over $4.00 per gallon in 2008 and is now $2.81, per EIA. The CBO economic and budget issue brief, Climate-Change Policy and CO2 Emissions from Passenger Vehicles is an excellent meta-analysis and summary of CAFE, carbon pricing, and gasoline price elasticity as they relate to passenger vehicle fuel consumption. EIA projects that the effects of growing population and vehicle fleet will just be offset by the mandated fuel economy of the new CAFE standards. Link. Thus, whether or not there is a cap/trade program or other carbon price mechanism, it appears there will be no reduction (or increase) in US use of petroleum over the next dozen years and that our contributions to GCC from petroleum use will also be stagnant. It's all about coal.

Update on Tuesday, February 9, 2010 at 09:18AM by Skeptic

Robert Stavins discusses some of the pending legislative and regulatory alternatives for addressing global climate change here.  Using the same basic insight about the relative impact of carbon pricing on coal and other fossil fuels, I posted the following comment on the Stavins piece on Economist' View. 

The closer we get to the real issues, the more interested I get in GCC legislation. Although showing promise, Stavins is still behind the curve in that regard.

There is probably no more important political fact than that carbon pricing is very bad for coal interests, nearly neutral for petroleum, and very good for natural gas. This results from starting by appeasing the god of economic efficiency with a system that generates a single price for all CO2 emissions regardless of source. That leads to the drama in Congress about trying to prevent the shuttering of the coal mining industry and write-off of coal-fired power plants (e.g., by making it possible to substitute “offsets” by “preserving” Amazon rain forests, etc.) and/or obscuring the attack on coal by assigning to the “market” responsibility for determining outcomes (so that elected representatives of the people can deny responsibility for lost livelihoods). A more realistic legislative approach might be to buy all the coal mines and turn them into wildlife preserves and soccer fields.

In support of the first sentence above, consider the following. According to CBO, a price of $191 per ton of CO2 would not reduce consumption of highway fuels at all below what they will be under existing CAFÉ standards. To see why this is so, consider how the $80/ton price recently proposed by Joseph Stiglitz would affect coal and gasoline. A ton of typical steam coal contains about 1400 lbs. of carbon, which will turn into 5,133 lbs. (2.57 tons) of CO2. If CO2 is assessed at $80 per ton, the price of a ton of coal would increase by $205. Since the national average coal price was $31.26 in 2008, that price increase would cause electricity generators to close their coal-fired plants as soon as possible and switch to natural gas, renewables, and (maybe) nuclear.

In contrast, $80 per ton for CO2 would raise the price of gasoline by only $0.80 per gallon (a gallon of gasoline generates ~20 lbs. or 1/100 of a ton of CO2). Obviously, that won't discourage use of highway fuels very much even though it would cost US consumers $110 billion per year in the aggregate. In the US, about 60% of petroleum is converted into gasoline; other major products are motor diesel, jet fuel, home heating oil, and a variety of industrial uses, none of which were addressed by the CBO report; however, I doubt a price increase of 20-30% in these fuels would dramatically reduce consumption of them either, but you use your own business judgment. Bottom line: a price of $80/ton of CO2 could cause an INCREASE in consumption of petroleum products as utilities switch from coal fired units to gas turbines (which were originally designed to burn petroleum distillates, not natural gas, in the stratosphere).

So why does the petroleum industry seem so upset by cap/trade? I suggest they are not really upset but are just routinely opposing and exploiting opportunity. They have a budget and team for federal government relations and will devote it to whatever issues on are on the table, which at the moment includes threatened government “interference” in their business—even if the “interference” might help their business. In contrast to this routine opposition, if you want to see what a petroleum industry full court press looks like, if you want to see the sky over DC darkened by corporate jets and the finance chairs of Senate re-election campaigns worked to exhaustion booking contributions, bring a repeal of the IRC oil depletion allowance close to a floor vote. Furthermore, it is routine in Washington to demand something of value in exchange for any legislative initiative that can be plausibly claimed to have an adverse effect on one's industry. This isn’t a crisis for the oil industry—it’s an opportunity.

From EPA’s most recent report on US contributions to global climate change, using 2006 data: CO2 accounts for 85% of total greenhouse gas emissions, 94% of which come from burning fossil fuels, and about 41% of that comes from coal. If petroleum consumption will not change substantially and natural gas consumption will increase, any aggregate net change must come from reducing coal consumption. Legislation that does not respond head-on to this reality may pave the way to re-election of incumbents but won’t ameliorate the GCC problem.

Can reducing deforestation really save the planet?

One of the climate protection initiatives being discussed in Copenhagen is "reducing emissions from deforestation and degradation in developing countries" ("REDD"). In fact, Obama endorsed the concept in Oslo last week, according to this report from Climate Progress:

President Barack Obama "made his first public intervention in the Copenhagen climate summit" by supporting the Norway-Brazil plan to allow rich countries to fund the protection of rainforests. "I am very impressed," Obama said after accepting the Nobel Peace Prize, "with the model that has been built between Norway and Brazil that allows for effective monitoring and ensures that we are making progress in avoiding deforestation of the Amazon."

The Union of Concerned Scientists has a very helpful discussion of important REDD concepts such as stocks vs. flows of CO2, additionality, leakage, carbon market offsets, and national baselines. It concludes by saying that, as a practical matter, REDD can only work if operated at a national level, with a national emissions baseline, effective monitoring, and demonstrated reduction of emissions at the national level. Not only are those requirements likely to overwhelm the institutional competence and integrity of developing nations, but it doesn't deal with the problem that deforestation effectively controlled in one participating nation may "leak" into a non-participating nation.

The same Climate Progress post goes on to report some possible progress in monitoring technology:

International approval for the Norway-Brazil proposal for a Reducing Emissions from Deforestation and Degradation (REDD) mechanism still has a ways to go, especially as targets for reductions of deforestation have not yet been determined. In a possible breakthrough for the integrity of such programs, Google presented tools for the accurate monitoring of the rates of deforestation via climate satellite data.

But today's news on the institutional side is not good:

In Copenhagen, officials from China and India have vowed to reduce carbon intensity, while other fast-developing countries like Brazil and South Africa also have taken pledges to reduce carbon. But they are fiercely protecting the right to make those goals voluntary -- or at least not subject to any penalties if they do go under review.

REDD is of great interest in industrialized nations because of the prospect that emitters there can defer or avoid emissions reductions by buying REDD "offsets," and financial institutions are very eager to participate in those transactions. I see a big risk that the US and Europe will eventually agree to a program that serves these business interests and does not actually protect the climate.

Update on Tuesday, December 22, 2009 at 10:21AM by Skeptic

From Robert Stavins favorable assessment of the results of the COP-15 conference that ended last week in Copenhagen:

9.      The developed countries commit to a goal of jointly mobilizing $100 billion annually by 2020 from sources both public and private.

Assessment: It is important that the Accord notes that the funds can come from either public or private sources.  Governments can — through the right domestic and international policy arrangements — provide key incentives for the private sector to provide the needed finance through foreign direct investments for emissions mitigation (clearly a role exists for government assistance for adaptation).  For example, if the cap-and-trade systems which are emerging throughout the industrialized world as the favored domestic approach to reducing CO₂ and other greenhouse gas emissions are linked together through the existing, common emission-reduction-credit system, namely the Clean Development Mechanism (CDM), then powerful incentives can be created for carbon-friendly private investment in the developing world.

Clearly the CDM, as it currently stands, cannot live up to this promise, but with appropriate reforms there is significant potential.  Of course, problems of limited additionality will inevitably remain.  Therefore, what is needed is for the key emerging economies to take on meaningful emission targets themselves (even if equivalent to business as usual in the short term), and then participate directly in international cap-and-trade, not government-government trading as envisioned in Article 17 of the Kyoto Protocol (which will not work), but firm-firm trading through linked national and multi-national cap-and-trade systems.

Such private finance stands a much greater chance than government aid of being efficiently employed, that is, targeted to reducing emissions, rather than spent by poor nations on other (possibly meritorious) purposes.

(Emphasis added.) This well illustrates my concern that US negotiators (with whom Stavins is well connected) are so determined to have a world-wide private trading program that they are willing to overlook the fact that "problems of additionality will inevitably remain."  Down that road lies a program that generates lots of transaction fees, provides developed nation money to elites in developing nations, and let's CO2 emitters in the developed world escape obligations to do things that would actually reduce CO2 emissions.  

The other meaning of “peak oil”

Worldwide demand for petroleum will peak in less than 10 years, according Arthur D. Little in a story about a similar report from Greenpeace, as reported in the Guardian:

Peter Hughes, who spent much of his career at BP and BG, and is now director for global energy at consultancy firm Arthur D Little, recently wrote a report titled 'The Beginning of the End for Oil?' He supports the Greenpeace view and said the correlation between oil demand and GDP growth has been weakened. "It is widely accepted that demand in OECD countries has plateaued and is going into decline but it has also been thought that would be massively outweighed by growth in China. But the Chinese think long-term and identified some time ago that the biggest threat to their economic growth was an increasing dependency on imported energy, which is anathema to them. The conclusion is clear – to reduce the reliance on hydrocarbons through energy efficiency and fundamental technology change. I think we will reach peak oil demand in the middle of the next decade."

The Chinese energy independence strategy will tend to hold down petroleum prices but increase CO2 emissions as China exploits coal instead of oil.

Coal is a big problem, not a solution.

One government policy response to the threat of global climate change is to provide incentives to develop clean electricity sources, such as solar and wind power, and to require their use by "renewable portfolio standards." An unintended and unfortunate consequence of those policies could be to displace clean natural gas fired power plants instead of shutting down dirty coal fired power plants, according to the CEO of Entergy, Wayne Leonard, in this NYT op ed piece. It is worth reading in full. Of course, being right about problems with that policy doesn't mean his preferred policy, cap and trade, isn't also fraught with potential for unintended consequences and failure.

Whatever global climate change policies are put in place, they can succeed only if they put a stop to burning coal without carbon capture and sequestration ("CCS"). If CCS technology is not commercialized—and the Bush administration shut down the most promising attempt to demonstrate CCS—the only way to save the planet is to stop burning coal. Period. There is at least one thing wrong with every policy option for getting to that result, but that's what has to happen. And it has to happen worldwide.

Update on Tuesday, January 27, 2009 at 09:12AM by Skeptic

While I think price manipulations could bring about dramatic changes in the fuels and technology used in electricity generation, I don't think increasing the tax rate on highway fuels is a practical answer to either our energy security problem or the global climate change problem. Very high highway fuel tax rates, more than $2 per gallon say, would only reduce per-vehicle consumption to a level approaching present-day Europe, and that's not good enough. Here is an excellent CBO study in October 2008, and Climate Progress has a good analysis here.

How replacing petroleum fuels with alternative liquids would change greenhouse gas emissions

One thing that is not obvious from the graph is that the 47% reduction in greenhouse gases attributed to replacing highway fuels with electricity from the grid assumes an average mix of electricity generation sources.  More than 83% of CO2 emissions from US electricity generation come from the half that comes from coal.  Although grid power to on-board batteries to on-board electric motors wastes only about half as much energy as an on-board internal combustion engine, the potential greenhouse gas improvement would be lost to the extent that shifting to electric vehicles results in the construction, or delays the retirement, of coal-fired power plants.  The marginal coal plant would emit about as much CO2 per vehicle mile as the petroleum fueled vehicles displaced.

The energy efficiency (and political) geography of corn to ethanol.

The energy efficiency of using non-renewable energy sources (fossil fuels and nuclear) to grow corn and convert it to ethanol is poor at best—1.39 joules of output for every joule of input. (The gain comes from renewable solar inputs as the corn grows.) In other words, 72% of the energy in this so-called "renewable" fuel actually comes from non-renewable sources. When one considers the best whole State, Iowa, the energy gain drops to 1.32 to 1, and 76% of the energy inputs are non-renewable. In most regions of the US, the net return is negative, meaning the non-renewable energy inputs exceed the energy content of the ethanol output. The geographic region of negative net return expands considerably when the calculations do not give a credit for the 19% of output that is in the "distiller's grains" co-product.

This post and map by "EROI Guy" on The Oil Drum shows that "energy return on investment" depends greatly on where the corn is grown. He points out that as the nation increases its commitment to turning corn into transportation fuels, increasing amounts of corn will have to be grown in marginal regions that require more energy inputs, which will reduce the marginal and average conversion efficiency and drive up corn prices.

To the extent our goal is to reduce CO2 emissions, corn to ethanol is a terrible idea because the proportion of "renewable" content in the ethanol is very small or negative. If we don't care about global climate change or increasing the cost of transportation fuels but do care about minimizing energy imports, corn to ethanol is a way to convert domestic coal to a transportation fuel—not a good way, but a way. Notice that the EROI map closely resembles the political map on this issue.

Excerpt from EROI Guy:

How much of the 36 billion gallons mandated by the RFS [Renewable Fuels Standard] is an net energy profit? The answer depends, in part, on where the ethanol is produced. If the mandate was fulfilled only by ethanol produced in Iowa, which has a refinery-gate EROI of 1.32:1 (Table 1), the net energy profit provided by the ethanol is actually 9 billion gallons. On the other hand if the ethanol were produced in Texas, then the net energy profit is only 4.7 billion gallons.

Clearly, the net gains from this process are less appealing than the gross. The net gains are even lower if co-product credits are removed. Co-products are dry or wet distiller's grains, which are a very contentious subject in the literature on corn-ethanol. This matter is significant because the energy credits allotted to the use of co-products as a by-product of the corn-based ethanol process account for 19% of the total energy gains of the corn-based ethanol process (co-products are allotted 4.13 MJ/L while ethanol is 21.46 MJ/L). More importantly, when this 19% is removed from the EROI calculation, the EROI of corn-based ethanol for marginal lands (e.g. Texas) is less than 1. Which is to say that the net energy profits from the production of 36 billion gallons of ethanol in Texas, for example, would be -1.08 billion gallons [36 billion gallons * (1- (1/0.97))]. In other words, without the energy contained in the co-products, the production of corn-based ethanol on marginal lands creates net energy losses rather than profits.

Whether or not co-products should be included in the calculation of the EROI is a topic for a different discussion, but the impact of excluding them is profound. The primary message to be gleaned from this post is that "scaling-up" corn-based ethanol or other similar biofuel projects usually have complications, such as lower corn yields on marginal lands, and these complications tend to increase the costs, not the gains, associated with converting feedstocks with low energy densities to final products with higher energy densities.

Update on Friday, August 28, 2009 at 01:20PM by Skeptic

Ironically, it is predicted that global warming is likely to raise temperatures most in the corn belt, causing large drops in crop yields.  Climate Progress has a map, the story, and links here. 

The elephant in the global warming room

One predicted effect of global warming is rising sea level. Predictions are of course predictions, and people may choose to be unpersuaded. But here's an observable fact they cannot deny—the sea level has risen 8 inches in the last 100 years, according to this Los Angeles Times article, which describes the inexorable effects in Malibu. This NASA report confirms that and reviews sea level rise events over the last 20,000 years, based on geological evidence. NASA reports an acceleration in the rise starting a century or century and a half ago.

Twentieth century sea level trends, however, are substantially higher that those of the last few thousand years. The current phase of accelerated sea level rise appears to have begun in the mid/late 19th century to early 20th century, based on coastal sediments from a number of localities. Twentieth century global sea level, as determined from tide gauges in coastal harbors, has been increasing by 1.7-1.8 mm/yr, apparently related to the recent climatic warming trend. Most of this rise comes from warming of the world's oceans and melting of mountain glaciers, which have receded dramatically in many places especially during the last few decades. Since 1993, an even higher sea level trend of about 2.8 mm/yr has been measured from the TOPEX/POSEIDON satellite altimeter. Analysis of longer tide-gauge records (1870-2004) also suggests a possible late 20th century acceleration in global sea level.

Atmospheric CO2 measurements by satellites start next month.

This ought to settle once and for all the question whether ambient CO2 has anthropogenic sources and help monitor changes in CO2 emissions and concentrations as regulatory programs take effect.

In January, the next frontier of atmospheric CO2 measuring instruments will begin when the National Aeronautics and Space Administration launches the first carbon-scanning satellite, called the Orbiting Carbon Observatory.

Each day, the satellite will orbit Earth 15 times, taking nearly 500,000 measurements of the "fingerprint" that CO2 leaves in the air between the satellite and Earth's surface. The data will be used to create a map of CO2 concentrations that will help scientists determine precisely where the sources and sinks are—showing differences in trace gases down to a 1 part per million precision against a background of 380 parts per million CO2 equivalent.

Update on Wednesday, February 25, 2009 at 08:27AM by Skeptic

Oops.  Yesterday's launch failed, and the NASA satellite crashed into the ocean.  Japan successfully launched a similar satellite last month, and it is undergoing tests.

Obama’s economic, energy, environmental, and national security policy

Obama "wants to launch an 'Apollo project' to build a new alternative-energy economy. His rationale for doing so includes some hard truths about the current economic mess," according to this Joe Klein interview reported in the current Time magazine.

The engine of economic growth for the past 20 years is not going to be there for the next 20. That was consumer spending. Basically, we turbocharged this economy based on cheap credit." But the days of easy credit are over, Obama said, "because there is too much deleveraging taking place, too much debt." A new economic turbocharger is going to have to be found, and "there is no better potential driver that pervades all aspects of our economy than a new energy economy ... That's going to be my No. 1 priority when I get into office.

This succinct statement of where we are, how we got here, and why we need to do something different in the future, and the focus on a new alternative-energy economy as our next growth engine is all good. It could mean big domestic investment and spending, creating millions of hot jobs with low unemployment, rising middle class incomes and spending, downward pressure on oil prices, shipping less of our wealth to petro-states, getting our balance of payments in order, and stopping global climate change.

Update on Thursday, October 30, 2008 at 11:34AM by Skeptic

And Obama put this same message into his 30-minute infomercial aired last night. A transcript is here on Joe Romm's blog. 

States not waiting for feds to save the planet.

In the US, State law initiatives have been very effective in reducing greenhouse gas emissions compared to the business-as-usual States. Here is an interactive map showing CO2 emissions per capita in each State and the District of Columbia in 2005. Center for American Progress created it combining the latest available data from the Energy Information Agency with Bureau of Census data.

CO2 emissions for the whole US averaged 20.7 metric tonnes per capita. Nine of the 10 lowest emitting States (includes DC), emitting from 6.77 to 13.36 tonnes per capita, all had in place aggressive state law programs mandating energy efficiency and/or renewable energy mandates, and all have greenhouse gas emission targets. (Idaho didn't but made the clean 10 because of the preponderance of hydroelectric power.) As a consequence, their per-capita emissions are roughly half those of comparable States that do not have such programs.

In all, 36 States had emissions less than 25 tonnes per capita. Eleven higher emitting States ranged from 26.54 to 40.72 tonnes per capita, and then there were four very high emitters, West Virginia (63.3), Alaska (71.8), North Dakota (83.1), and Wyoming (124.21).

A “cap and trade” approach to greenhouse gases shrinks from the real issue.

A fundamental problem with "cap and trade" is that environmentalists hear "CAP and trade" and businesses hear "cap and TRADE" and/or "cap and EVADE." Trying to design a system that manipulates market forces to achieve indirectly what some are afraid to talk about directly will not achieve the necessary reductions of greenhouse gases. For example, those who mine, transport, and burn coal are going to fight just as fiercely against a market manipulation system that eliminates coal combustion as they would against a regulation directly banning it. If we want the burning of coal to stop--and we should absent carbon capture and sequestration--we need to confront the issue directly and pay the politically necessary compensation.

Update on Friday, November 28, 2008 at 04:12PM by Skeptic

Getting Real on Climate Change by Nordhaus and Shellenberger: 

For 20 years the green climate change agenda has embraced two insidious orthodoxies that are rooted in market fundamentalism:  Deficit spending is always bad for the economy, and we should "let the market decide" our energy future.  The result has been serial political failure, skyrocketing emissions, and stagnation of energy technology.  Now is the time to let go of the pollution-pricing paradigm, along with a zero-sum dificit mentality, and embrace an agenda squarely focused on public investment, building the enabling infrastructure, and making clean energy cheap.

Joe Romm (Climate Progress) seems to hate these guys and the horse they rode in on, but I wonder if he wouldn't agree with that quotation.  The article has much information about the declining fortunes of "cap and trade" in Congress and failures in practice where it has been tried. 

Time to sell the beach house

The defenders of the status quo against legislation to ameliorate global climate change include 16 moderate Senate Democrats, according to this post at Breakthrough. It appears they will not propose their own legislation but will oppose anything, like a carbon cap and trade regime, that imposes substantial new costs on their constituencies.

Meager environmental benefits of a hefty carbon tax in Norway

Norway adopted in about 1990 carbon taxes that range from $16 to $65 per ton, and gasoline costs $9-10 per gallon (including a carbon tax of about $0.60). The $65 tax did induce natural gas producers to inject produced CO2 under the seabed instead of venting it to the atmosphere, but the lower tax rate on paper mills did not substantially affect how they operate. Significant reductions in the metals industry were achieved by "voluntary" agreements, not taxes. Despite these efforts, CO2 emissions have risen substantially in Norway, according to this Wall Street Journal blog post and the linked WSJ article. (The article does not make clear whether the tax rates are per ton or tonne or for C or CO2.)

So, how much will CO2 emissions have to cost in order to save the planet? I'm guessing the number is considerably higher than the carbon taxers and the cap-and-traders think reasonable and politically tolerable.

Update on Monday, October 6, 2008 at 10:15PM by Skeptic

And the CBO agrees that carbon emissions charges of up to $191 per ton would not significantly reduce US gasoline consumption, in the short term or the long term, in a report released today. 

That comparison suggests that gasoline prices might have to rise above $6.50 per gallon--for example, from a CO2 price that added $2.00 or $2.50 per gallon to gasoline prices--for the average fuel economy of new vehicles in the United States to approach the 35 mpg that the new CAFE standards will require.  But the CO2 prices contemplated in current U.S. climate legislation and in prominent international policy analyses would add much less than $2.00 to the price of gasoline.  Thus, such pricing, by itself, would probably not increase average fuel economy beyond what the CAFE standards will require.

CBO has estimated that under S. 2191, the America’s Climate Security Act of 2007, the price of a CO2 emissions permit would rise from about $23 per metric ton in 2009 to about $44 in 2018 as the stringency of the bill’s cap on greenhouse-gas emissions was gradually increased. Such permit prices would raise gasoline prices by about 20 cents per gallon in 2009 and 40 cents per gallon in 2018. A recent report by the Intergovernmental Panel on Climate Change (IPCC) suggests that a permit price of as much as $80 per ton of CO2 might be necessary by 2030 to reduce emissions enough to achieve a stabilized climate by 2100. That pricing policy would add about 70 cents per gallon to the price of gasoline in 2030. Even the much greater and much earlier reductions called for in the Stern Review on the Economics of Climate Change (requiring a current estimated permit price of $95 per ton of CO2, rising to $191 per ton by 2050 and higher after that) would not cause gasoline prices in the United States to be as high as they already are in Europe. The permit prices in the Stern report would add roughly $0.85 to $1.70 per gallon to gasoline prices over the next four decades.

Thanks to Mark Thoma's blog for bringing this to my attention. 

Actual greenhouse gas emissions increases graphed against targeted reductions

This post at The Energy Collective has an interesting graph in 2 versions comparing reported greenhouse gas emissions since 1990 against Kyoto and other prominent GHG reduction targets. There is also a link to the Nature blog where it first appeared and a discussion about what, if anything, it means. Emissions have stabilized in the developed world (despite increases in the US) but are increasing apace in the developing world. 

Still more scientific evidence that we are cooking ourselves

The National Academy of Sciences published in June 2008 a peer-reviewed study in which a team of climatologists and earth scientists reconstructed average global temperatures over the past 2 millennia using records in tree rings, coral growth rings, ice cores, and other proxies for temperature. The paper concludes that the sharp rise from the late 19th Century to now, in both northern and southern hemispheres, is unprecedented in the interval studied. A good summary of the paper, with its startling graphs, is at Climate Progress, which also links to the NAS paper. The work confirms and extends earlier work based only on tree rings and is further compelling evidence of anthropogenic global warming over the last century.

US national security interests require it to make war on high oil prices.

This New York times article highlights the geopolitical peril of continuing high oil prices. The big Western oil companies like Exxon Mobil and BP have the best technology and people for finding and developing petroleum, but continuing nationalization of petroleum gives them few and decreasing opportunities to apply their skills in the places around the world that have the best potential. I have never bought the idea that the world is approaching "peak oil" in a geological sense, but we may be there geopolitically. I note some implications for the geopolitical strategies of the US and our global adversaries and for the business strategies of Western oil companies.

As late as the 1970s, Western corporations controlled well over half of the world's oil production. These companies—Exxon Mobil, BP, Royal Dutch Shell, Chevron, ConocoPhillips, Total of France and Eni of Italy—now produce just 13 percent.

Today's 10 largest holders of petroleum reserves are state-owned companies, like Russia's Gazprom and Iran's national oil company.

We should be concerned that national oil companies are not only less able to keep pace with growing demand but also that they may be less willing to do so because they have in mind a much higher world price range for oil than we do. For example, the Russian economy was a basket case until oil prices started to rise and would be a basket case again if oil prices dropped to $30, which is about where they were in real dollars 10 years ago. Clearly, the Russians' strategy for enhancing its geopolitical position depends in large part on maintaining high oil prices. The same is true of Iran and Venezuela, and other OPEC nations may be more willing than they were to see sustained higher oil prices.

The entire US transportation system and our military run on oil, and that is true also of all industrialized nations. Temporary supply interruptions like we had twice in the 1970s are, of course, possible, but today the much more likely and more debilitating threat is sustained high oil price levels. Sustained high prices cripple us and our oil-short partners like Europe, Japan and China. Sustained low prices would cripple our most dangerous geopolitical adversaries like Russia and Iran.

We could open up all of the US, onshore and offshore, to oil drilling, and I'm not opposed to that, but that would have zero impact on oil supplies and prices for at least 10 years. Meanwhile, America may be bled dry economically by high oil prices, and our most dangerous adversaries would become more powerful. Our national security requires that we take other actions to put immediate and continuing downward pressure on world oil prices. The best way to do that is to manage our one-quarter share of world oil consumption rapidly downward by mandating dramatic efficiency improvements. If, despite this, oil prices are nonetheless too high, the effect on our economy will be much less if we consume only half as much as we do now. These actions would also reduce the US contribution to greenhouse gas emissions and create good domestic jobs.

This is a strategically difficult time for big Western "oil companies." They are locked out of the best petroleum provinces where they could potentially earn the biggest margins. To the extent they are able to continue exploring and developing petroleum in less attractive places, they are likely to be the highest-cost producers in the world market and, thus, most vulnerable to profit destruction if/when world oil prices are low. Even worse, if my recommendation in the previous paragraph were adopted, there would be a long-term slump in oil prices, and they would be closing refineries. All of the big Western "oil companies" seem to be positioning themselves to participate in the businesses that would grow if there were a public policy mandate to dramatically reduce oil consumption, but if those new businesses are not stimulated by government subsidies or mandates, those efforts are likely to come to naught. Until a policy direction becomes clear they are likely to continue to dis-invest in the energy business by buying back their own stocks.

Update on Wednesday, August 20, 2008 at 08:42PM by Skeptic

Here is a perspective on the importance of oil prices to Russia.

Update on Sunday, August 24, 2008 at 08:12PM by Skeptic

And what if Russia perceives that global warming would be a strategic benefit to it?  Joe Romm discusses the problem in the context of US Presidential politics. 

Update on Monday, August 25, 2008 at 02:44PM by Skeptic

In this Foreign Affairs essay, Richard Holbrook expands on the dangers of the US, China, the EU, India and Japan transferring more than $2 trillion annually to oil producing nations.  He does not call for a war on price, but there is no other way to slow down that wealth transfer in the short term. 

Any major reduction in US greenhouse gas emissions must come from electricity generation, transportation, and industry.

In May, the Senate debated for 30 hours and rejected the Boxer-Warner-Lieberman bill that would have, maybe, reduced US emissions of CO2-equivalent gases enough to bring them back down to 2008 levels by 2025 after letting them rise in the near term. In order to avoid a runaway atmospheric greenhouse effect, the Union of Concerned Scientists has estimated (as have others) that the United States and other industrialized nations must reduce by 2050 their emissions by 80 percent versus 2000 levels. The International Energy Agency has suggested that a 50 percent reduction below 2005 levels might be sufficient to avoid that calamity.

I am posting here the EPA's 2006 inventory (at ES-16) of CO2-equivalent gases to show which industries and activities would need to be most dramatically affected if substantial reductions are to occur.

Electricity generation (mostly coal)    34%

Transportation (mostly oil)                  28%

Industrial                                              19%

Agriculture                                             8%

Commercial                                            6%

Residential                                              5%

Update on Wednesday, July 23, 2008 at 03:05PM by Skeptic

The Kyoto Protocol, which was strongly opposed by the US Senate and never submitted for ratification and from which President Bush formally withdrew in 2001, would have required the US to reduce emissions in the 2008-2012 time frame to 7% below 1990 levels.  This was estimated to require a 20-30% reduction from projected business-as-usual emissions in 2008-12.  Unresolved issues about counting CO2 sinks and purchasing credits from foreign sources made the exact obligation murky.  Source:  Library of Congress-Congressional Research Service via PolicyArchive. 

The world should follow Japan’s lead on greenhouse gas emissions control.

With the recent failure in the Senate of a cap-and-trade bill to reduce greenhouse gas emissions in the US, it's time to reconsider the basic regulatory approach. I have argued at length elsewhere (5th comment, by Roger Chittum) that the cap-and-trade methodology is too vulnerable to political manipulation and evasion and that technology-based emission limits on a plant by plant basis would be more saleable to developing countries. I am delighted to see in this NYT report that Japan has been going in this direction and will urge it on the G-8 next week.

At next week's summit meeting, Japan plans to back an initiative that could make its frugal energy levels the new standards for global industries.

Now, its government is pushing an initiative that could set Japan's levels of energy conservation as targets for global industries. Mr. Fukuda has proposed what is called a sector-based approach to new targets for reductions in greenhouse gas emissions. This means is [sic] setting the same numerical goals for all companies in an industry, regardless of location. The Kyoto Protocol set mandatory limits for industrialized countries.

The sector approach has been embraced by Japanese industry groups, which say their high levels of efficiency should become the global standards. This would also give Japanese companies more opportunities to sell their energy-saving technologies and skills around the world.

The Bush administration has focused on developing sector-by-sector partnerships with Japan and other countries to find ways to curb emissions, but remains opposed to mandatory limits.

A plant-by-plant or sector-based approach would require every new or modified plant to meet the emission limits that could be met by using the best control technology proven to have worked anywhere in the world, a standard that would continuously improve as technology advanced. This is how the Clean Air Act and the California analog work, and this scheme has been spectacularly successful in making California's air, and the nation's air, much cleaner now than it was 40 years ago, despite explosive population and transportation growth. In contrast, cap-and-trade has been failing in Europe.

In a triumph of Chicago School economic orthodoxy over what has been proven to work, Obama and McCain have both announced that they favor cap-and-trade regimes. 

Update on Sunday, July 6, 2008 at 01:53PM by Skeptic

President Bush commented today on the Japanese proposal to reduce greenhouse gases, He said there could be no solution to global climate change unless China and India are also held to "emission reduction standards."  This sobering article about the widespread environmental atrocities being committed in China, and the institutional barriers to stopping them, suggests the difficulty of achieving what Bush correctly said we must achieve. 

Even when the Chinese central government makes commitments and issues rules, they are routinely and extravagantly flouted by often-corrupt local officials.  Though this seems implausible in our world, it is entirely consistent with this report that decentralization has also been responsible for economic growth and human rights abuses in China.  In short, China seems to resemble the American 19th Century where robber barons plundered the land, the environment, and local populations, and gained control of state and local governments as necessary. 

In a legal and political environment like China's, no imaginable cap and trade system is going to work.  There would be a much better chance of enforcing clear, strict, and inflexible best available control technology and/or emission standards on each and every plant.  The US should lead by example by adopting at home the system that will work best in China. 

Update on Monday, July 7, 2008 at 09:21AM by Skeptic

Dean Baker points out here that Bush's idea of having China and India adopt the "same emission reduction standards" that would apply to the G-8 would result in per-person emissions in China and India being held to one quarter what they are in the US.  If his goal is to do nothing about global climate change, insisting on this will surely get him there. 

Update on Monday, August 25, 2008 at 02:52PM by Skeptic

In this Foreign Affairs essay, Richard Holbrook predicts that the multilateral approach of the Kyoto Protocol, to be followed in 2009 by the Copenhagen Agreement, have only the slimmest of chances of being adopted by the US and China.  Instead, he suggests bilateral agreements between the US and China, perhaps including also Japan.  He reports that on a recent trip to China, "senior Chinese officials" showed interest in exploring the idea through non-governmental channels. 

Their concern, freely expressd, was that any energy plan the West proposed would be just another device to slow down China's economic growth.  Whether true or not, this deeply felt view, shared by India and other major emerging markets in regard to their economic growth, must be understood and taken into account in order to make progress.

China's vice premier in charge of trade and finance suggested something along these lines in this Financial Times opinion piece on June 15, 2008.