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Vol. II, No. 21

Cooler Heads Digest

Title

Vol. II, No. 21

Politics

Little Progress Expected in Buenos Aires

The fourth Conference of the Parties (COP-4) will meet in Buenos Aires, Argentina on November 2-13 to further discuss greenhouse gas reductions. According to Melinda Kimble, acting assistant secretary of state, there probably will be little progress toward reaching the administration’s goals. "Buenos Aires has the potential to be a small step forward," Kimble testified on October 6 before the House Commerce Subcommittee on Energy and Power.

The biggest hurdle is emissions trading. Different countries have different ideas on what an emission trading system would look like under the Kyoto Protocol though views have converged in recent weeks.

Kimble was questioned about the administration’s definition of "meaningful participation" by developing countries. She admitted that the administration has "no definition." But, she said, it will not be a "one-size-fits-all solution." Targets for poorer countries with low emissions will be different than for richer developing countries with higher emissions (BNA Daily Environment Report, October 7, 1998).

European Union Softening on Limits for Emissions Trading

The European Union appears to have relented, for the time being, on its demand that the use of emissions trading be limited. In a meeting in Luxembourg on October 6 the EU environment ministers agreed that the EU will insist at COP-4 that emissions trading "be defined in a quantitative and qualitative terms based on equitable criteria" at a later date.

At the Council of Ministers moderate countries convinced hard-liners that it would be a mistake to demand a cap on emissions trading. "For tactical reasons there was a majority opinion that there is no reason to narrow ourselves to a precise 50 percent cap now," said Peter Jorgensen, a European Commission official. "This is especially true when it comes to dealing with the Americans" (BNA Daily Environment Report, October 7, 1998).

Clinton Administration to Move Forward With Emission Trading

The Clinton Administration will pursue emissions trading even if there is no agreement reached at Buenos Aires, Kathleen McGinty, chair of the White House Council on Environmental Quality, explained at a congressional hearing held by the House Government Reform and Oversight Subcommittee on National Economic Growth, Natural Resources, and Regulatory Affairs.

There is nothing in the Kyoto Protocol that prevents the U.S. and other countries from pursuing emissions trading even if there is no agreement among the parties regarding the rules governing such a system. "Should push come to shove," McGinty said, the United States will not be "held hostage to complete a unanimous agreement before we move on with trading measures." McGinty also said that "while we have our option to proceed unilaterally it is our preference to proceed in partnership."

She also said that the Clinton Administration will not submit the Kyoto Protocol to Congress until flexible mechanisms "are available and agreed upon by the parties" (BNA Daily Environment Report, October 13, 1998).

Business Could Get Credit for Early Greenhouse Gas Reductions

While many in Congress are holding the line against the unconstitutional implementation of the Kyoto Protocol, others are trying to facilitate implementation without ratification. Sen. John Chafee (R-R.I.) has introduced a bill (S. 2617) that would give businesses credit for voluntarily greenhouse gas reductions. This bill would allow President Clinton to "enter into binding agreements with U.S. businesses to voluntarily reduce their greenhouse gas emissions."

The bill, cosponsored by Connie Mack (R-Fla.) and Joseph Lieberman (D-Conn.), "will provide the certainty necessary to encourage entrepreneurial companies to move forward with practical emission reductions now," said Chafee (BNA Daily Environment Report, October 14, 1998).

Economics

Government Study Contradicts Administration’s Cost Estimates

Several studies done by private, econometric modeling firms show the costs of complying with the Kyoto Protocol to be high. Critics argue that these studies cannot be trusted given that they were funded by the fossil fuel industry. A new government study, however, has just been released which validate the findings of the industry-funded studies, and counters claims by the Clinton Administration the costs will be negligible.

The report by the federal Energy Information Agency (EIA) "assumes that the U.S. State Department’s assessment of the accounting of carbon-absorbing sinks and offsets from reductions in other greenhouse gases will reduce the binding U.S. emissions target to 3 percent below the 1990 level of emissions," rather than the stated target of 7 percent below 1990 levels.

The EIA estimates that the Kyoto Protocol will cost the U.S. economy $64 billion per year. Under a carbon tax, energy prices will double by 2010 and then "decline to 79 percent above reference case price levels in 2020." Gasoline prices could rise by 53 percent and electricity prices could rise by as much as 86 percent by 2010. Overall the EIA study paints a rather gloomy economic picture under the Kyoto Protocol. The study is available on the web at http://www.eia.doe.gov/oiaf/kyoto/kyotorpt.html

Energy Conservation May not be Such a Good Deal

One of the solutions to global warming, according to Clinton Administration officials, is the greater use of energy efficient technologies. We’ve been told that all of the technologies necessary to cheaply reduce fossil fuel use are already available and it’s just a matter of using them. One of President Bill Clinton’s favorite examples of energy saving technology is energy efficient fluorescent lighting.

It is generally argued that investments in energy conservation measures, such as replacing incandescent light bulbs with fluorescent light bulbs or insulation, pays for themselves in a short period of time. Some estimates show very high rates of return to energy conservation investments. Advocates of energy efficiency, however, have been puzzled by the lack of consumer interest in such potentially lucrative investment. This "Energy Paradox," they believe, can best be explained by invoking consumer ignorance, arguing that they "apply very high discount rates to these investment opportunities." A solution to this problem is an aggressive public education campaign.

In a paper delivered at a conference sponsored by the American Enterprise Institute on September 14, Gilbert Metcalf, an economist at Tufts University, and Kevin Hassett with the American Enterprise Insitute, give a different explanation. They believe that the "engineering estimates of potential energy savings – which are often provided by the manufacturer of the relevant product – misrepresent savings because they are based on highly controlled studies that do not perfectly apply to actual realized savings in a representative house."

The paper, Measuring the Energy Savings from Home Improvement Investments: Evidence from Monthly Billing Data, estimates the return on attic insulation. One study found that the returns "can easily be on the order of 50 percent per year." Metcalf and Hassett, however, find actual returns to be around 9.9 percent per year.

For a variety of reasons consumers rarely achieve the level of savings theoretically possible. They conclude, "We find that the data – which may well be the most comprehensive yet applied to this question – provide little evidence of an Energy Paradox."

Science

Global Warming/Hurricane Link Debunked

The Cooler Heads coalition sponsored a science briefing for media and congressional staff on October 9, featuring Dr. William Gray, professor of atmospheric science at Colorado State University. Gray, the foremost expert on hurricanes in the U.S., spoke about the link between global warming and hurricanes.

According to Gray, hurricane activity follows a natural 20 to 40 year cycle that is correlated to changes in ocean currents. The 1940s and 1950s, for example saw many land-falling tropical storms. From 1947-1960 there were 14 land-falling storms, but from 1960-1988 there were only 2. We are now in a period of heightened hurricane activity.

The mechanism that controls the Earth’s most important and largest ocean current, known as the thermohaline circulation, is salinity. The Atlantic Ocean is much saltier than other oceans because there is more evaporation than rain. This salty (and warmer) water travels north where it sinks due to its higher density, cools and returns to the south. There it warms and becomes saltier, beginning the process once again.

When salt content is high the ocean current is strong, pushing the salt particles through the system rapidly, preventing the build up of salt. This weakens the ocean current leading to greater salinity which in turn strengthens the current again. This occurs in 20 to 40 year cycles, according to Dr. Gray, is entirely natural, and has been occurring for thousands of years. When salinity is high and the thermohaline circulation is strong this warms up the North Atlantic and hurricanes become more frequent and more intense. When the circulation is weak the opposite is true.

Dr. Gray also addressed the problems of climate modeling. He said that numerical modeling has been a great success for forecasting the weather for five to ten days into the future. This is because forecasters can measure the wind patterns that are there in the present and ride those out for a few days. After a while, however, the current energy fields no longer hold and predictive power plummets. Another problem is the "butterfly effect" where small modeling errors either in the measurements or in the physics grow over time becoming nonlinear and the whole thing "blows up on you."

The greatest problem with the models, however, is the failure to correctly model water vapor feedback, Gray said. Water vapor feedback accounts for 85-90 percent of the warming in the models, according to Dr. Gray. James Hansen a well-known climate modeler assumes that upper level humidity goes up 50 to 60 percent in his model. Dr. Gray believes that as carbon dioxide in the atmosphere increases there is a slight reduction in water vapor to balance the carbon dioxide pick up.

Finally, Dr. Gray made some predictions. He believes that we are entering a period of weakened thermohaline circulation which means that we will see fewer land-falling hurricanes and a slight decrease in global temperatures over the next 2 to 4 decades. He also predicted that there will be fewer El Niño events over the next 20 to 30 years.

New Evidence Shows Abrupt Global Climate Change

The global warming debate has several facets. One of the most important is the detection of the human signal amongst the surrounding natural variation. The problem is that the variation is much larger than the predicted human-induced warming. Paleoclimatic research, for example has found very large and rapid temperature changes over the last 100,00 years, providing a puzzle for climatologists. So far, however, the evidence has pointed to a seesaw effect where the Earth’s polar regions experience temperature change at different times, shifting back and forth.

New research published in Science (October 2, 1998) has found evidence that the abrupt warming that occurred in the North Atlantic about 12,500 years ago, also occurred in Antartica. Ice core samples from Taylor Dome, in the western Ross Sea sector of Antarctica show that the temperature there warmed by 20 degrees Fahrenheit in a very short time. This corresponds with a 59 degrees warming that occurred over 50 years in the Arctic, suggesting that the temperature change was global.

According to James White, a climatologist at the University of Colorado, Boulder and a co-author of the study, "We used to suspect that some of these big changes that occurred naturally in the past were only local. Since we see the same thing at opposite ends of the Earth, it does imply that the warming was a global phenomenon." These findings "throw a monkey wrench into paleo-climate research and rearrange our thinking about climate change at that time," White said (Chicago Tribune, October 4, 1998).

THE COOLER HEADS COALITION

Alexis de Tocqueville InstitutionAmericans for Tax ReformAmerican Policy CenterAssociation of Concerned TaxpayersCenter for Security PolicyCitizens for a Sound EconomyCommittee for a Constructive TomorrowCompetitive Enterprise InstituteConsumer AlertDefenders of Property RightsFrontiers of FreedomGeorge C. Marshall InstituteHeartland InstituteIndependent InstituteNational Center for Policy AnalysisNational Center for Public Policy ResearchPacific Research InstituteSeniors Coalition60 PlusSmall Business Survival CommitteeThe Advancement of Sound Science CoalitionThe Heritage Foundation