Fun with Graphs

In the introductory lecture to my class on sustainable energy this semester our professor went through a bunch of graphs from the BP report on energy that show the distribution of energy use, CO2 emissions, and energy intensity across the globe. One thing about several of the graphs stuck me and I've put them below with a brief explanation.

Graph 1: Primary Energy per Capita

Note where India is on the graph. This is primarily due to their relatively small industrial base and extremely large population (the same reason that China, even with massive amounts of energy use, is small as well. Between the two of them they have somewhere between twenty-five and thirty-five percent of the global population). The next graph follows from this one and shows roughly what you'd expect.

Graph 2: Per Capita CO2 Emissions

As I said, this shows roughly what you'd expect. India has the smallest per capita energy use of the countries shown and thus has the smallest per capita CO2 emissions. As a side note, Norway drops off the graph because, while they use an enormous amount of energy, something like 90% of their electricity comes from hydro power, which for all its other environmental problems, is an extremely clean source of energy from a CO2 emissions standpoint.

The final graph is the kicker and what really caught my attention in class. It shows the per kilowatt hour emission of CO2. Basically how efficiently, from an emissions standpoint, you produce your electricity. As I've already said, Norway does this extremely efficiently.

Graph 3: CO2 Emissions per kW of Electricity

It should be obvious now that India does not produce electricity efficiently in terms of emissions. Nor does China (this most people knew already and is due to the massive number of coal power plants they are building). It's worth noting that Brazil, who also gets huge amounts of its electricity from hydro, is so low on the list and Norway isn't even on the list.

So what does it all mean? A lot of economists think that in the next 30 years India will overtake China as the fastest growing economy due to demographic reasons (China's population, due to the one child policy, has peaked and will start to decline. India, on the other hand, is still growing). Right now India's per capita emissions are so low because it's per capita energy use is so low, which is due to the fact that most of the population still lives an agrarian lifestyle. As Dani Rodrik points out here, as countries develop labor moves from agriculture to industry. Industry requires significant increases of energy inputs over pre-modern agriculture. A lot of this energy comes in the form of electricity (factory lights, urban street lights, factory machines, etc). Thus, as India's population urbanizes and industrializes their per capita use of energy, and therefore per capita emissions, will increase. What the third graph says is that for every unit increase in energy usage, their emissions will increase more than anywhere else in the world. So the least efficient country in the world in terms of emissions from electricity will also be the fastest growing country in the world. A wonderful combination.

Big picture? It means that global CO2 emissions will increase even faster as India industrializes than they did while China was industrializing. A terrifying thought for anyone who is concerned about atmospheric concentrations of CO2. It also underlines the absolute necessity of getting developing countries on board with any climate agreement. I'm not sure about the scale impacts of India's emissions relative to the developed world but it isn't inconceivable that their development could negate any unilateral efforts to reduce emissions undertaken by the developed world.

Clean Coal: No Solution for Black Lung

A lot has been written about the problems with Clean Coal and the fact that the purported environmental benefits are, in reality, essentially non-existent. I will not re-hash those discussions here except to outline them briefly. The fundamental problem with the claims of Clean Coal is that the power plants still emit carbon. The must capture this and then store it underground. In theory this works. However, it is technology that has never been used on a large scale and no one is quite sure how permanent the storage is. Furthermore, no one is sure what such large levels of carbon in the bedrock will do to the chemical makeup of the soil. Based on these reasons alone Clean Coal should be approached with skepticism, but there are far more condemning reasons why it is not the future of energy in this country.

The fundamental problems with using coal to power America lie much further upstream than power plants. The real problems with coal can only be seen by looking at coal from a lifecycle perspective. While burning coal has plenty of problems, the truly problematic aspects of coal lie in its removal from the earth. Clean coal does not address these problems. Clean coal only addresses the downstream emissions problems and ignores the upstream production.

The upstream impacts include both environmental problems and damages to human health. It is up to you to decide which is a bigger problem but either one, taken individually, is a reason to put an end to coal mining in this country. Together they are and overwhelming indictment of the industry.

The first, human health impacts have been recognized by anecdotal knowledge and personal stores of miners forced out of the business by black lung and other diseases for years. All of this anecdotal evidence was finally quantified by a recent study from West Virginia University that measured the human impacts of mining and compared it to the economic revenue that mining brings in (the study can be found here). What it found was shocking. From 1997-2005 West Virginia counties dependent upon coal mining have had an average of 10,000 excess deaths annually. The study links these excess deaths to both the poverty levels in the region as well as the increased exposure to pollution and environmental damage created by mining activities. Those are 10,000 deaths each year so the country can have cheap electricity.

Valuating these deaths, as well as the additional health care costs caused by the pollution and environmental degradation, the study estimated the total health costs of coal mining at around 42 billion dollars. This was the most conservative estimate produced by the study. Some estimates ranged as high as 80 billion dollars. When compared to the 8 billion dollars a year that the coal mining industry brought to the region and it is easy to see why Appalachia is America’s very own third world country.

Based on standard economic indicators these regions are worse off than nearly anywhere in the country. They have the highest poverty levels, highest unemployment levels and lowest income levels. This new study now indicates that they have some of the highest health costs as well. The people who work in these mines are not dumb – they realize the health risks, but they have nothing else. The primacy of coal and the $60,000 salaries mining offers effectively stifle the development of any other economic opportunities. Yet, it is clear based on the anecdotal evidence and this new research, it simply is not worth it. The people in these communities are literally dying so that America can have cheap energy.

It is not just the health impacts that condemn coal however. The environmentally impacts of mining are just as devastating. The most popular, and least expensive, means of mining is not the traditional underground shaft operations. Instead, it is industrial strength excavation. Commonly called mountaintop removal. Companies use large quantities of dynamite to blow the tops off mountains so that they can go in with heavy machinery and scoop the coal out.

This has been shown to be the most destructive type of land use change in the country. It is immense in scale and essentially irreversible. The mountains are blown apart and the remains are dumped in the surrounding streambeds. From 1992-2002 over 1200 miles of streams were buried in West Virginia. This may not seem like a huge deal but it means that 1200 miles of ecosystems were destroyed. It means that downstream areas were poisoned with elevated levels of heavy metals (which have human as well as environmental impacts). It means that the mountains are being irreversibly changed to produce dirty power.

In the same period, over 380,467 acres of forestland were cleared by these mines; 380,467 acres of forest that had been sequestering carbon. Remember, land use changes account for 10% of global emissions. Not only is coal emitting carbon when it is burned but it also accounts for huge land use change emissions.

In the face of all of this evidence the question remains: why are we still promoting coal? The common answer is because it is cheap and the country needs cheap electricity. But by any measure of cost – economic (clean coal will cost four to five cents more per kilowatt hour than traditional coal, nuclear or wind power), social or environmental - coal is far from cheap. It has created a “land of sacrifice” in Appalachia where people are destroying their heritage and, quite literally, killing themselves to provide the rest of the country with dirty energy.

The obsessive focus on coal and clean coal as a future source of energy makes no sense. The Senate needs to recognize this and pass Waxman-Markey without concessions to the coal industry and without emphasizing clean coal as a long-term solution. Meanwhile, investment into renewable and non-coal sources of electricity needs to be increased. Then, maybe, Appalachia can move beyond a coal economy and begin to reach the quality of life enjoyed by the rest of the country.

Corn Foolery

U.S. environmental policy is to be dictated by the concerns of energy generation yet again. This time it is not the oil and gas companies or the coal companies that are to blame but the farmers of the Midwest. Not content to simply destroy the biological diversity of the Great Plains or ruin the soil quality through mono cropping they have now gotten into the global warming game as well.

Rep. Peterson (D-MN) is the man most directly responsible for this but it is really the corn farmers of the Midwest who do not want the cash cow of biofuels to disappear. What I am referring to are the changes made late last night in the Waxman-Markey Bill climate bill that will now restrict the EPA’s ability to regulate the Ethanol industry.

Last month the EPA proposed a rule that would have required “lifecycle emissions” to be calculated into the Carbon footprint of the fuel. This means that the land use changes undertaken when production of the corn needed to produce the type of ethanol that comes out of the Midwest would have to be counted as part of the production cycle’s carbon footprint. This does two things: first, it significantly reduces the environmental appeal of corn based ethanol fuels (more on that below) and, second, under any type of permitting scheme in which ethanol produces are required to hold permits or credits for the emissions they produce it increases costs of production and makes ethanol less competitive with traditional oil based fuels.

But if this change makes ethanol more competitive isn’t that a good thing? Economically, for the farmers? Yes. Environmentally? No, not at all. The principle of a carbon cap-and-trade system (what Waxman-Markey is essentially creating) is that polluters have to pay for their pollution. Either this cost is internalized, or better, passed on to the consumer as a way of making them pay for the environmental damage that their lifestyle causes. This price signal, in theory, then induces people to change the way they live to a more sustainable lifestyle. As Yvo de Beor noted, “you can eat strawberries in the dead of winter, providing that you pay the environmental cost associated with getting those strawberries to you at that unsustainable moment in time.” You either pay for the correction of the emissions that your strawberry passion causes – through sequestration projects – or you just learn not to eat strawberries in January if you live in Boston.

Yet, this internalization of costs is precisely what the changes to the Bill are designed to avoid. Using a fuel that has fewer tailpipe emissions is fine. However, the full environmental impacts of the production of the fuel must be considered. The use of corn ethanol, when viewed from the perspective of its entire lifecycle is at best only slightly more appealing, and at worst, it is just as bad, as oil based fuels. The annual carbon emissions caused by global land use change – peat mining, deforestation, turning grassland into farm land, etc – are greater than the emissions caused by every car, truck, train, ship or plane in the world. The change in Waxman-Markey explicitly ignores this reality and allows midwestern farmers to produce corn-based ethanol at a fraction of the proper, sustainable, cost.

The counter-argument to all of this is that a price system like the one proposed, where people pay for their unsustainable lifestyles has a disproportional impact on low-income families. Those who can afford to pay the extra cost of strawberries in January will do so while those who cannot will be forced to choose something else. There is some truth to this. However, the reality is that there is no other option. The U.S. emits approximately 20 tons of CO₂/captia annually. The IPCC calculated sustainable amount? 2 tons/capita annually. We cannot continue to live the lifestyle to which we have become accustomed. We must choose a more sustainable lifestyle because technology is not changing fast enough to permit us to live the way we have been while emitting less CO₂.

This is not to suggest that the policy should be entirely regressive. Under a properly managed cap-and-trade system, the permits are auctioned of to companies with the auction revenue going to the government. If there are concerns about the regressivity of the program the auction proceeds can be used to compensate low-income families for the increased cost of carbon intensive goods. This must be done carefully however because the price signals cannot be entirely muted. They should simply be equalized, as best as possible, across socio-economic levels.

Corn-based ethanol is not the answer to American energy needs or to a more sustainable future. The changes in Waxman-Markey are a step backwards for progress towards a world that emits less CO2 and here is to hoping that the final house bill does not include these mistakes. Failing that, one must hope that the Senate has a better grasp of what it means to create a climate bill that recognizes the realities of global climate change and is aggressive enough to properly address them.

What would Martin Luther think?

Last month the Catholic Church announced the return of plenary indulgences. They need not have. Environmentalists have already claimed the privilege of putting a price on guilt for this century. The new Catholic indulgences will have to take a back seat to carbon credits when it comes to buying your way out of sin.

To be fair, the Catholics will no longer allow you to buy your way out of Hell. They no longer sell indulgences, rather the indulgences can only be granted for doing things that good Catholics should be doing anyway. It is too bad that some environmentalists are not following their example but, instead, insist upon following in the footsteps of the 15th century Catholics and are selling redemption for cash.

For environmentalists, redemption comes in the form of carbon offsets; forgiveness for their role in global warming. For anyone who does not know what a carbon offset is, the essential idea is that companies, or individuals, engage in activities that have a net negative impact on CO2 emissions – planting trees, installing carbon sequestration devices in factories, using renewable power sources rather than traditional power sources, etc – and then calculate the amount of CO2 they have taken out of the atmosphere and sell the right to release that much CO2 to someone who has not reduced their carbon output. The going rate in European markets in 2007 was between 21† and 24† for a pound of emitted CO2.

It has become increasingly popular for those celebrities who wish to appear environmentally friendly to publicly buy these credits to “offset” the carbon expended in their daily lives. Once they have purchased their credits they can blithely jet from their manses in Italy all over the world: confident that they are doing their part to protect the environment.

This confidence in their environmental credentials is the flaw in the carbon credit argument. While, unlike indulgences in past centuries, some carbon credits can actually repair past “sins” by removing carbon from the atmosphere the mechanism by which this occurs is not well understood. This means that the degree to which planting a tree actually offsets carbon is not entirely clear. Furthermore, the regulatory schemes which determine what constitutes a carbon credit, and who can and cannot sell them, are not well defined or sufficiently advanced to ensure that the markets are secure and non-fraudulent. Essentially, there is no way of knowing whether or not those carbon credits purchased to forgive air travel actually equal the amount of carbon that the flight released.

There is, however, an even more fundamental flaw with the practice of offsetting carbon emissions through carbon credits. Like indulgences carbon credits are a forgiveness of “sin” that absolves the sinner of guilt for having committed an action. Whether or not someone should feel guilty for these actions is irrelevant, the essential fact is that, if they are purchasing a carbon credit, they clearly feel guilty for taking that action. By purchasing the carbon credit they therefore, in their minds, absolve themselves of the guilt incurred by releasing carbon into the atmosphere. It is this absolution that creates the fundamental problem with credits.

So long as credits do not directly reduce the amount of carbon in the atmosphere – and to some extent even when they do – there is problem with absolving this guilt. The problem is that guilt provides an enormous incentive to change behavior (Irish Catholics have known this for a very long time and anyone with an Irish Catholic mother can attest to their reliance on this knowledge). By absolving this guilt through the purchase of carbon credits the incentive to change behavior is removed. Rather than make the difficult decision to fundamentally change their behavior people can simply purchase credits to make what they would have done anyway “environmentally friendly.”

Yet, drastic and fundamental change is absolutely necessary. Offsetting carbon emissions will not stop global Warming. It will require a wholesale re-organization of the way which society, especially American society, conducts itself (for a better explanation of this see here). Providing the option of carbon credits simply promotes the myth that business as usual can continue and the environment will be fine.

Even if carbon credits actually do reduce the CO2- levels in the atmosphere, they still provide no incentive to change behavior. It is not possible, or desirable, to simply remove all of the CO2 from the atmosphere and as a result some type of change is still necessary.

While there is a place for a well-ordered carbon credit market, especially as a means of reducing industrial pollution, the presence of a personal market for carbon offsets is not a long-term solution. Rather than encouraging the purchase of these credits, environmentalists would be better served by following the model of the Catholic church and handing out credits to those who car pool, who bike or who minimize flights. In short, those who do what good environmentalists should do anyway.