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State Climate Policy Solutions For a new, stronger, clean energy economy

State Climate Policy Solutions For a new, stronger, clean energy economy. NCEL 09.08.09 K.C. Golden Policy Director. “We are addicted to oil”. Symptoms: Economic hemorrhaging : $450 M per month in King County Fever : increasing average temp is the least of it.

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State Climate Policy Solutions For a new, stronger, clean energy economy

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  1. State Climate Policy Solutions For a new, stronger, clean energy economy NCEL 09.08.09 K.C. Golden Policy Director

  2. “We are addicted to oil” Symptoms: Economic hemorrhaging: $450 M per month in King County Fever:increasing average temp is the least of it

  3. “We are addicted to oil” Symptoms: Economic hemorrhaging: Over $450 M per month in King County Fever: increasing average temp is the least of it Acute national insecurity:“Paying for both sides of the war on terror”

  4. Quit: Steadily reduce dependence….. ….by building a clean energy economy…. Treatments for addiction • Gas tax holiday: Cheaper drugs • Drilling: Increase the supply of drugs

  5. CAP Policy commitment to steadily reduce fossil fuel dependence …and a platform for launching a green economy

  6. State policies:Climate plans Maps from Pew Center

  7. State policies:Renewable Portfolio Standards

  8. State policies:Vehicle GHG Standards

  9. State policies:Commercial energy codes

  10. Cap makes it real: Get your wedge on!

  11. Key principles for climate policy design • EFFECTIVENESS • EFFICIENCY • EQUITY

  12. Effectiveness - Scale

  13. Effectiveness - Scale How much do we have to reduce climate pollution? Enough to stabilize the concentration of GHGs in the atmosphere “at a level that would prevent dangerous anthropogenic interference with the climate system.” How much is that? Avoid increases in average global temperature of > 2 degrees C How much is that? Stabilize the concentration of GHGs at 350-450 ppm So how much do we have to reduce climate pollution? 80% by 2050. More in the U.S. Avoiding Dangerous Climate Change – Cambridge University Press

  14. Effectiveness - Build

  15. Effectiveness – Get going!

  16. Efficiency

  17. Internationally Domestically Sectors, geographies, industries, economics Equity

  18. Equity – Green for all

  19. Investments Trade Incentives Tax Standards Design issues Cap and trade vs. Carbon tax Effectiveness: Quantity, not price, is the public policy imperative

  20. Design issues -- scope More is better • Effectiveness: Reduce more • Efficiency: liquidity, simplicity • Equity: not just point sources

  21. Auction or give away? Design issues – emission rights • Effectiveness:rewards • innovation; facilitates investment, consumer protection • Efficiency: simpler (baselines, early action) • Equity: avoids windfalls; level playing field

  22. Design issues - Offsets Limit them • Effectiveness:discourages transformation • Carbon storage in biomass not equivalent to emission reduction • Efficiency: verification is complex; “additionality” – critical, but counterfactual • Equity: aggravates environmental justice concerns; intergenerational foul

  23. Annual Mean Wet Sulfate Deposition 1989-1991 2004-2006 Cap and trade works for acid rain

  24. Acid Rain SO2 Program Costs: Much Lower than Originally Predicted 1990 1994 2004 Source: EPA, 2006

  25. Fossil fuel price politics • Concern that climate policy will raise prices • But prices are through the roof now! • Why? Supply and demand. • What drives the opposition? It will reduce our consumption of fossil fuels

  26. Public opinion • Public “favors” drilling • But they favor efficiency, renewables, and climate solutions by wider margins • Bottom line: Do something!

  27. Why states? “Global” warming is a local, state and regional issue

  28. State Climate Policy Solutions For a new, stronger, clean energy economy NCEL 09.08.09 K.C. Golden Policy Director

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