Better to do nothing than try to reach UN climate targets

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Lorrie Goldstein writes a review of a new Fraser Institute study by McKitrick and Murphy.  The study is Off Target: The Economics Literature Does Not Support the 1.5C Climate Ceiling.  Excerpts from Goldstein’s article in italics with my bolds.

Trying to achieve the United Nations’ target of limiting global temperature increases to 1.5 C above pre-industrial levels will do more social and economic harm than good, says a new study by the Fraser Institute released Tuesday.

“Although advocacy of aggressive climate-change policies is often draped with the mantel of science … the popular 1.5C policy target will pose costs that far exceed the benefits,” the study says.

“Emission reductions flowing from strict adherence to the 1.5C target would be worse for the world than doing nothing at all.”

Study authors Ross McKitrick and Robert P. Murphy argue in Off Target: The Economics Literature Does Not Support the 1.5C Climate Ceiling, that the 1.5C target “did not arise … from formal cost-benefit analysis.”

In fact, a 2018 report by the UN’s Intergovernmental Panel on Climate Change that argued there would be net societal benefits to achieving the 1.5C target — used by Canada and other countries to justify the public cost of lowering greenhouse gas emissions — “expressly stated” it did not do a cost-benefit analysis.

The 2018 UN study, Global Warming of 1.5°C — An IPCC Special Report, said because the calculations were so complex, “standard cost–benefit analyses become difficult to justify and are not used as an assessment tool in this report.”

Instead, the UN report cited a range of studies that have estimated the global cost of carbon pricing (expressed here in current Canadian dollars) to meet the UN’s target of limiting global temperature increases to 1.5C above pre-industrial levels by 2100.

They went from a low of $170 per tonne of emissions, to a high of $6,900 per tonne by 2030; $307 per tonne to $16,300 per tonne by 2050; $527 to $21,955 by 2070 and $865 to $33,873 by 2100.  Given such numbers, Murphy argues in the Fraser report, “it would be better if governments did nothing at all about climate change than to try to achieve the 1.5C target because the costs so outweigh the estimated benefits.

(Prime Minister Justin Trudeau’s current carbon price is $40 per tonne of emissions, rising to $170 per tonne in 2030.)

In the real world, no government is going to impose a carbon tax/price of up to $6,900 per tonne of emissions by 2030 — with more hikes after that — because it would be political and economic suicide.

No one knows what global temperatures are going to be in 2100, nor what the global carbon price on emissions would have to be by then to meet the UN’s target of limiting warming to 1.5C above pre-industrial levels.

What we do know for a fact today is that global emissions are steadily rising. The only exceptions in the modern era occurred in 2008-09 and 2020, when they fell dramatically not because of carbon pricing, but because of global recessions, before resuming their upward climb the following year.

We also know that as of 2021, we are so far behind the UN’s target of reducing emissions to 45% below 2010 levels by 2030, that achieving that goal would require lowering emissions globally by 7.6% annually every year between now and 2030.

And finally, we know that, since almost all goods and services consume fossil fuel energy, a 7.6% annual reduction in emissions every year from now until 2030, would provoke an unprecedented global recession in which the social and economic costs would far outweigh the benefits.

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Deception: Climate Financial Risk

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John H. Cochrane writes at Project Syndicate The Fallacy of Climate Financial Risk.  Excerpts in italics with my bolds.

The idea that climate change poses a threat to the financial system is absurd, not least because everyone already knows that global warming is happening and that fossil fuels are being phased out.
The new push for climate-related financial regulation is not really about risk; it is about a political agenda.

In the United States, the Federal Reserve, the Securities and Exchange Commission, and the Department of the Treasury are gearing up to incorporate climate policy into US financial regulation, following even more audacious steps in Europe. The justification is that “climate risk” poses a danger to the financial system. But that statement is absurd. Financial regulation is being used to smuggle in climate policies that otherwise would be rejected as unpopular or ineffective.

“Climate” means the probability distribution of the weather – the range of potential weather conditions and events, together with their associated probabilities. “Risk” means the unexpected, not changes that everyone knows are underway. And “systemic financial risk” means the possibility that the entire financial system will melt down, as nearly happened in 2008. It does not mean that someone somewhere might lose money because some asset price falls, though central bankers are swiftly enlarging their purview in that direction.

Bomb of money hundred dollar bills with a burning wick. Little time before the explosion. Concept of financial crisis

In plain language, then, a “climate risk to the financial system” means a sudden, unexpected, large, and widespread change in the probability distribution of the weather, sufficient to cause losses that blow through equity and long-term debt cushions, provoking a system-wide run on short-term debt. This means the five- or at most ten-year horizon over which regulators can begin to assess the risks on financial institutions’ balance sheets. Loans for 2100 have not been made yet.

Such an event lies outside any climate science. Hurricanes, heat waves, droughts, and fires have never come close to causing systemic financial crises, and there is no scientifically validated possibility that their frequency and severity will change so drastically to alter this fact in the next ten years. Our modern, diversified, industrialized, service-oriented economy is not that affected by weather – even by headline-making events. Businesses and people are still moving from the cold Rust Belt to hot and hurricane-prone Texas and Florida.

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If regulators are worried even-handedly about out-of-the-box risks that endanger the financial system, the list should include wars, pandemics, cyberattacks, sovereign-debt crises, political meltdowns, and even asteroid strikes. All but the latter are more likely than climate risk. And if we are worried about flood and fire costs, perhaps we should stop subsidizing building and rebuilding in flood and fire-prone areas.

Climate regulatory risk is slightly more plausible. Environmental regulators could turn out to be so incompetent that they damage the economy to the point of creating a systemic run. But that scenario seems far-fetched even to me. Again though, if the question is regulatory risk, then even-handed regulators should demand a wider recognition of all political and regulatory risks. Between the Biden administration’s novel interpretations of antitrust law, the previous administration’s trade policies, and the pervasive political desire to “break up big tech,” there is no shortage of regulatory danger.

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To be sure, it is not impossible that some terrible climate-related event in the next ten years can provoke a systemic run, though nothing in current science or economics describes such an event. But if that is the fear, the only logical way to protect the financial system is by dramatically raising the amount of equity capital, which protects the financial system against any kind of risk.

Risk measurement and technocratic regulation of climate investments, by definition, cannot protect against unknown unknowns or un-modeled “tipping points.”

What about “transition risks” and “stranded assets?” Won’t oil and coal companies lose value in the shift to low-carbon energy? Indeed they will. But everyone already knows that. Oil and gas companies will lose more value only if the transition comes faster than expected. And legacy fossil-fuel assets are not funded by short-term debt, as mortgages were in 2008, so losses by their stockholders and bondholders do not imperil the financial system.

“Financial stability” does not mean that no investor ever loses money.

Moreover, fossil fuels have always been risky. Oil prices turned negative last year, with no broader financial consequences. Coal and its stockholders have already been hammered by climate regulation, with not a hint of financial crisis.

More broadly, in the history of technological transitions, financial problems have never come from declining industries. The stock-market crash of 2000 was not caused by losses in the typewriter, film, telegraph, and slide-rule industries. It was the slightly-ahead-of-their-time tech companies that went bust. Similarly, the stock-market crash of 1929 was not caused by plummeting demand for horse-drawn carriages. It was the new radio, movie, automobile, and electric appliance industries that collapsed.

If one is worried about the financial risks associated with the energy transition, new astronomically-valued darlings such as Tesla are the danger. The biggest financial danger is a green bubble, fueled as previous booms by government subsidies and central-bank encouragement. Today’s high-fliers are vulnerable to changing political whims and new and better technologies. If regulatory credits dry up or if hydrogen fuel cells displace batteries, Tesla is in trouble. Yet our regulators wish only to encourage investors to pile on.

Climate financial regulation is an answer in search of a question. The point is to impose a specific set of policies that cannot pass via regular democratic lawmaking or regular environmental rulemaking, which requires at least a pretense of cost-benefit analysis.

These policies include defunding fossil fuels before replacements are in place, and subsidizing battery-powered electric cars, trains, windmills, and photovoltaics – but not nuclear, carbon capture, hydrogen, natural gas, geoengineering, or other promising technologies. But, because financial regulators are not allowed to decide where investment should go and what should be starved of funds, “climate risk to the financial system” is dreamed up and repeated until people believe it, in order to shoehorn these climate policies into financial regulators’ limited legal mandates.

Climate change and financial stability are pressing problems. They require coherent, intelligent, scientifically valid policy responses, and promptly. But climate financial regulation will not help the climate, will further politicize central banks, and will destroy their precious independence, while forcing financial companies to devise absurdly fictitious climate-risk assessments will ruin financial regulation. The next crisis will come from some other source. And our climate-obsessed regulators will once again fail utterly to anticipate it – just as a decade’s worth of stress testers never considered the possibility of a pandemic.

John H. Cochrane is a senior fellow at the Hoover Institution.

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Four Blunders in EU Climate Plan

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Pieter Cleppe writes at Real Clear Energy Four Flaws With the EU’s New Climate Plans Excerpts in italics wtih my bolds and images.

Last week, the European Commission presented its so-called Fit for 55 proposals, a raft of legislative initiatives intended to adapt EU law to the 2030 target of reducing CO2 emissions by 55 percent from 1990 levels. The idea is to adapt legislation originally intended to achieve a 40% reduction.

This undertaking, however, is marked by serious shortcomings. Herewith, I summarize what’s wrong with it, listing four main flaws.

  1.  The European Commission is employing a top-down approach, riddled with taxes and spending

The European Commission seems to take former U.S. president Ronald Reagan’s characterization of “government’s view of the economy” as a manual, rather than as a warning. As Reagan summarized government’s approach: “If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”

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Most remarkable here is the Commission’s intention to impose a de facto ban on gasoline and diesel cars by 2035, even if France seems keen to extend this until 2040. When even France is less restrictive, you’re not in a good place. Feeling the need to resort to outright prohibition, the Commission is clearly not putting great trust in innovation to come up with economically efficient, CO2-neutral cars.

A notable change is the expansion of the EU’s cap and trade scheme, which puts a price on emitting CO2 but allows companies to buy and sell their right to do so. The Commission wants to expand this so-called Emissions Trading System (ETS) – set up 16 years ago and covering power plants, intra-EU aviation, and energy-intensive industries – to include buildings, road transport, and shipping. The expansion would start gradually in 2023 and be phased in over three years, as the emission-rights regime for aviation is being tightened up and sectors not covered by ETS are made subject to emission-reduction targets, with binding targets per member state. EU minimum excise-duty rates on various energy sources, like motor or heating fuel, would also need to be increased, and a jet-fuel tax would need to be introduced on intra-EU flights, on top of a tax on maritime fuel.

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Opponents of the proposals, which still need to be approved by both EU member states and the European Parliament, include the shipping industry, which hasn’t exactly welcomed its inclusion into the ETS system. The International Chamber of Shipping described the proposal as “an ideological revenue raising exercise, which will greatly upset the EU’s trading partners,” as it would involve “non-EU shipping companies to be forced to pay billions of euros to support EU economic recovery plans.”

This doesn’t even account for another part of Fit for 55, whereby the Commission intends to create the world’s first carbon border tariff, to be levied on imports of goods including steel, cement, and aluminum, to be phased in from 2026. This step is deemed necessary because two-thirds of CO₂-emissions are likely to continue, only now outside of the EU, causing “carbon leakage” – a phenomenon notably hard to estimate, although we know that China has long outpaced the U.S. and the EU in terms of carbon emission.

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In response, Belgian employer federation VBO-FEB issued a warning about this “carbon border adjustment mechanism,” stating that “policy makers must be careful that (…) this will not cause other countries to impose countermeasures or cause supply chain distortions, leading us to import more finished products than raw resources.” The question remains as to whether this is not a protectionist measure in violation of the WTO agreement – especially when certain European producers would be exempt. In any case, it will unleash lots of extra bureaucracy, especially for small companies.

Also in line with Reagan’s description of government thinking is the European Commission’s plan to spend billions of euros to compensate for the damage done by its own measures – such as its proposal for a new “social climate fund” “to prevent fuel poverty,” using one-fifth of ETS revenue, on top of another fund, the €100 billion Just Transition Mechanism to help coal-dependent countries like Poland make the transition away from coal. Combined with the Commission’s demand to get at least 50% of the income derived from the new ETS transport and buildings revenue, this would mean that the ETS system would morph into an outright EU tax – a dream eurocrats have been pursuing for years.

2.  The proposed measures disproportionately hurt the poor

The European Commission itself has admitted that measures like putting a carbon price on heating fuels “will not affect households equally, but would likely have a regressive impact on disposable income, as low-income households tend to spend a greater proportion of their income on heating.” It is testimony to how divided opinion is even within the Commission, where many are questioning the rather extreme approach of EU Climate Commissioner Frans Timmermans.

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The predicted hardship for the poor then serves as yet another excuse to spend money – now to alleviate the damage done by the measures. The Commission is seemingly unaware that to finance spending, taxes are needed, and even corporate taxes are ultimately disproportionately borne by low-skilled workers. There is no free lunch, even when paying tribute to the Climate Gods.

Over the last few years, as exemptions for the CO2 emission-trading system have been reduced, this scheme has put upward pressure on energy prices, so it can be feared that this will cause more damage to the economy, particularly hurting the poor. The Commission thinks that CO2 prices in Europe will increase by 50 percent by 2030 if its plans are implemented – but some hedge funds already project an increase of almost 100% by the end of this year, with the more modest current arrangement in place.

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Pascal Canfin, chair of the European parliament’s environment committee, who started his career with the greens but is now a key ally of French president Emmanuel Macron, has called the plan to create an emissions trading system (ETS) for transport and buildings “politically suicidal” and “a huge political mistake.” He stated: “It’s a very bad idea,” adding that the Commission was “going to trap” lower middle-class families, noting that those hit the hardest would be people in regions with poor public transport and residents who could not pay for energy-efficiency upgrades to their homes. This follows the French government’s experience with the “gilets jaunes” (yellow vest) protesters, who managed to get Macron to abandon a fuel-tax hike in 2018.

France will take over the EU’s rotating presidency in 2022; let’s see how much then remains of the European Commission’s grand plans.

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Germany’s automobile industry has also warned that the proposed measures may have a “substantial” impact on jobs at auto suppliers – so even if the greens form part of the new German government, this may not all sail through so smoothly.

3.  The European Commission is not respecting the idea of “tech neutrality”

It’s one thing to impose a target to reduce CO2 emissions. It is quite another to try to micromanage how this can be achieved. Nevertheless, that is what the European Commission is doing with its so-called “EU taxonomy for sustainable activities,” a classification system meant to clarify which investments are environmentally sustainable, in the context of the “European Green Deal,” of which Fit for 55 forms a part.

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Several MEPs (mainly Greens) hold up anti-nuclear posters at the debate.

Despite all the evidence that nuclear power is CO2 neutral, the Commission refuses to acknowledge this reality. This denialism is the result of pressure by Germany, which decided to shut down all its nuclear plants, a policy that has driven energy prices in that country to record levels while also supporting the coal-energy sector. Germany thereby goes against the in-house scientific body of the European Commission, the Joint Research Centre, which declared earlier this year that nuclear power is a safe and climate-friendly energy source and should be considered as “green” under the EU’s classification system.

To add insult to injury, the Commission considers biomass a renewable energy – despite the fact that burning wood for energy, which is what biomass is ultimately all about, typically emits 1.5 times more CO2 than coal and three times more than natural gas. The EU is the world’s largest net importer of wood pellets; the main net exporters are the United States, Canada, and Russia.

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Green campaigners have been complaining about EU member states like Estonia that allow intensive clear-cutting of trees in forests protected under EU Natura 2000 rules. One NGO, the Estonian Fund for Nature, has also pointed out there is a direct connection between the subsidized growth in the biomass industry and EU renewable-energy policies.

More than 500 scientists have urged the EU to stop treating biomass as carbon-neutral. Even if one disagrees, and believes that biomass can be sustainable and renewable, it still doesn’t make sense to privilege biomass over nuclear power.

Biomass represents almost 60% of renewable-energy consumption in the EU, so the implications of no longer considering it as renewable energy would be grave: wind and solar power contribute only marginally to the EU’s energy provision, irrespective of their environmental downsides. Changing biomass’s renewable status would make it almost unavoidable to recognize nuclear power, which would be embarrassing for the likes of German chancellor Angela Merkel, who has been putting so much political capital into defending Germany’s nuclear exit.

4.  The EU’s grand plans may not do that much for climate change

At the end of the day, the goal of all this is to counter CO2 emissions in a bid to halt climate change.

Here, an interesting contrarian view comes from Danish economist Bjørn Lomborg, author of the bestseller “The Skeptical Environmentalist.”

Lomborg has highlighted UN Climate Panel estimates that the negative impact of climate change in the 2070s would be equivalent to reducing the average income between 0.2% and 2% – meaning that global incomes would increase only by 356% by then, and not by 362%. He then contrasts this with the enormous cost of EU climate policies, which would “quadruple electricity wholesale prices in just a decade,” and he cites academic studies showing the real costs of EU climate policies to be four times higher than optimistic EU estimates, ultimately amounting to a whopping €4 trillion to €5 trillion.

Lomborg estimates that the new EU target of 55% carbon-emission reduction will reduce the global temperature by the end of the century by an immeasurable 0.004°C – “equivalent to postponing global warming by six weeks in 2100.”

Surely we can agree that it is hard for both proponents and skeptics of expensive climate policies to provide hard proof that they are right in their arguments. But these estimates should make even the most committed EU Commission climate fanatic pause for reflection.

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Global warming is in our mental models.

Gruesome Climate Crisis Talk at Davos

the-great-reset-by-the-world-economic-forum-prism-ua-world-economic-forum-great-resetMichelle Stirling explains what is terribly wrong about their train of thinking in the video below.  For those who prefer reading a transcript, I have provided one below, in italics with my bolds along with some images.

Davos climate crisis talk is disturbing and inaccurate

Hi, I’m Michelle Stirling for Friends of Science Society. I love life, I enjoy this beautiful world and I think being alive is a wonderful gift. That’s why it’s so disturbing to read some of the comments from the recent World Economic Forum in Davos. The conference concluded leaving some commentators concerned about depopulation talk from high profile individuals like Jane Goodall and misinterpreted IPCC SR 1.5 findings by Greta Thunberg, and talk of doomsday battles by Al Gore.

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Goodell’s statement shocked many people when she said all these environmental things we talk about wouldn’t be a problem if there was the size of population that there was 500 years ago. The world’s population is estimated to have been about 500 million people then, or 6.7 billion less than today. Depopulation notions stem from apocalyptic climate visions but Roger Pielke jr. explains in a January 2nd, 2020, article in forbes that climate science has been corrupted by the influential risky business report of 2014. This report was funded by green billionaires and proliferated into the media and scientific domains by powerful environmental groups. Pielke jr. says the report misattributes the proposed pathways, focusing on the most extreme scenario called the representative concentrated Pathway 8.5, something that is far from a business-as-usual case relevant to the Davos set of bankers and billionaires.

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Mark Carney’s infamous speech to Lloyd’s of London of 2015 breaking the tragedy of the horizon that Also invoked the risky business report that Pielke jr. says has corrupted climate Science. RCP 8.5 is used in an influential graph on page 105 in the IPCC SR 1.5 report that Greta Thunberg refers to in her speeches at Davos. Greta referred to a table on page 108 of theIPCC SR 1.5 report for her crisis comments, but most of the scientific papers referred to in that table were published in or before 2013. And in 2013 the IPCC AR 5 report in box 9.2 chapter 9 stated there had been a hiatus in warming since before Kyoto. That’s like 15 years despite a dramatic rise in carbon dioxide concentration from human industry and activity.

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Dr Judith Curry testified to the US Senate on January 16, 2014, that based on that IPCC AR-5 evidence, carbon dioxide is not the control knob that can fine-tune climate. Curry noted that the science of climate change is not settled and evidence reported by the IPCC AR-5 weakens the case for human factors dominating climate change.

Nevertheless well-known climate scientists like professor Katherine Hayhoe continue to present proposed mitigation pathways as she did at the University of Calgary wherein she stated that she considered China to be a leader in climate mitigation.

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We are just starting now to curve off the higher scenario if you notice here we’re almost here we’re just starting to curve off the higher scenario. When I say we I actually mean it’s mostly, get this, it’s mostly good in China. China has more wind and solar energy than any other country in the world. And you know I’m not a hundred percent confident in their emission estimates, so keep this with a bit of a grain of salt. But at least what we’re working with in the global level suggests that we’re starting to peel off the higher scenario, but not fast enough to get down to a lower scenario or meet the pair of targets. That’s absurd: a month of China’s emissions equal a whole year of emissions by Canada.

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World Primary Energy consumed in 2020 was 567 Exajoules (BP Statistics)

Hayhoe advocated for rapid decarbonization referring to the RCP 8.5 versus a lower RCP. But a chart from the original report from Van Viren et al shows that no RCP scenario is fossil fuel free, debunking the notion that net zero 2050 should even be part of public policy or that rapid decarbonization is necessary. Roger Pielke jr. says these RCP models cannot be compared to each other, and even the RCP authors state they’re not meant to be used in this way. For instance all the RCP pathways other than 8.5 represent a world with billions fewer people.

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Another highlight at Davos was Al Gore’s fear-infested closing as noted by Hans Rosling and family in their book Factfulness. In 2009 Rosling met Al Gore who told him then we have to create fear, an approach that that medical doctor and international public health policy expert Rosling rejected. Rosling wrote that fear plus urgency makes for stupid drastic decisions with unpredictable side effects. And contrary to the doom and gloom of Davos, Factfulness shows how the world is improving for all people despite certain inequities, contrary to the doom and gloom of Davos. A decade later Al Gore continues with his apocalyptic approach, and at Davos he claimed the climate crisis was equivalent to historic wars even invoking 9 /11 again.

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As Roger Pielke jr. notes in an earlier Forbes article, this is nothing but climate porn and is not supported by the scientific evidence in IPCC reports But fortunately there is a global pushback on this damaging depopulation and doom and gloom fear-mongering. CLINTEL, the climate intelligence organization based in the Netherlands, representing more than 800 global scientists, sent a letter to the World Economic Forum stating there’s no climate emergency and insisting that we do have time.

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And pointing out the uncertainties of climate models that Greta and Al Gore use for their apocalyptic statements. A commentary has been posted on CFACT that summarizes the CLINTEL manifesto and Friends of Science Society. We’ve published the CLINTEL document and videos on our blog.

It is deeply disturbing that depopulation talk has become part of mainstream climate policy discussions with even a Quebec politician suggesting that medically assisted suicide could be available to those who want to die to save the planet. We were given this gift of life in a beautiful world, one that has problems, but I believe we are up to the challenge. There’s no climate emergency so let us live with hope and joy.

For Friends of Science Society, I’m Michelle Stirling

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My Summary

Clearly, the 1% are fearful of losing their planetary playground because the other 99% of us consume too much.  So they want there to be fewer of us and to constrain our personal mobility and choices.  Not so long ago, Romanians has strict quotas for their daily calorie intake.  Several countries plan to scrap gasoline autos and affordable air travel. This is the driving force behind the Great Reset.  Who knows how this mindset translates into actions on the ground?

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See also Resist the Great Reset

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Climate Kool-Aid

Climate Kool-Aid

Johnathan DuHamel has another fine article at his blog Wry Heat  The Biden Administration Has Swallowed the Climate Kool-Aid.  Excerpts in italics with my bolds and some images.

The Biden administration thinks they can stop global warming (aka climate change) by eliminating carbon dioxide emissions from burning fossil fuels and switching electrical generation to wind and solar installations. Biden says “follow the science.” If he did follow the science he would realize that there is no physical evidence that carbon dioxide plays a significant role in controlling global temperature (see posts at the end of this article).

Biden wants 80% hydrocarbon-free electricity generation by 2030, 100% by 2035 and elimination of fossil fuels from all sectors of the U.S. economy by 2050.

According to Paul Driessen (senior policy analyst for the Committee For A Constructive Tomorrow), “ this would send the nation’s annual electricity requirement soaring from about 2.7 billion megawatt-hours (the fossil fuel portion of total U.S. electricity) to almost 7.5 billion MWh per year by 2050. Substantial additional generation would be required to constantly recharge backup batteries for windless, sunless days, to safeguard society against blackouts, cyberattacks and wholesale collapse. Generating all that electricity without new nuclear and hydroelectric plants would require tens of thousands of 850-foot-tall offshore wind turbines, hundreds of thousands (perhaps millions) of somewhat smaller onshore turbines, and billions of photovoltaic solar panels. All these turbines, panels, batteries and power lines would require tens of billions of tons of non-renewable iron, copper, aluminum, cobalt, lithium, rare earth elements, plastics, limestone and other materials. That would necessitate mining, crushing, processing, refining and transporting tens of billions of tons of ores – from thousands of mines and quarries, using gigantic gasoline and diesel equipment – followed by smelting and manufacturing, all with fossil fuels.

None of this is clean, green or sustainable.”

So, how is “global warming” doing. We can consult with Dr. Roy Spencer who manages the Advanced Microwave Scanning Radiometer flying on NASA’s Aqua satellite. This satellite system measures global atmospheric temperature daily. The latest results are seen here:

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You should notice that global atmospheric temperatures in April, May, and June, 2021, were below the 1991-2020 average and similar to temperatures in 1983. According to the Global Monitoring Laboratory of NOAA at Mauna Loa, Hawaii, atmospheric carbon dioxide was about 340ppm in 1983 versus about 418ppm now. Although there has been deviation from the average due to things like the El Nino-La Nina cycles, there has not been any overall warming in spite of the increase in carbon dioxide.

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Biden and other climate alarmists have swallowed the climate “Kool-Aid” and claim that reducing just one, small, insignificant factor will be the panacea in controlling global temperature, but it’s not that simple:

“The forcings that drive long-term climate change are not known with an accuracy sufficient to define future climate change.” — James Hansen, “Climate forcings in the Industrial era”, PNAS, Vol. 95, Issue 22, 12753-12758, October 27, 1998.

“In climate research and modeling, we should recognize that we are dealing with a coupled non-linear chaotic system, and therefore that the prediction of a specific future climate state is not possible.” — Final chapter,Third Assessment Report, IPCC 2000.

While controlling CO2 emissions from burning fossil fuels may have some beneficial effects on air quality, it will have no measurable effect on climate, but great detrimental effects on the economy and our standard of living. The greatest danger of climate change is that politicians think they can stop it. But the climate has always been in a state of flux. In my opinion, the debate over global warming is truly a scam designed to control (and tax) production and use of energy from fossil fuels.

The alleged “climate crisis” is just a scam perpetrated for political gain.
“The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary.” —H. L. Mencken (1880-1956)

(Note to younger readers: The term “Kool-Aid” used in this context refers to cult leader Jim Jones who, on November 18, 1978, instructed all members living in the Jonestown, Guyana compound to commit an act of “revolutionary suicide,” by drinking poisoned punch. Link )

For the real science, see these articles from my blog

See also Biden Climate Agenda Heads into Perfect Storm

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Green Energy Failures Redux

I was going to end the title of this post with “Deja Vu”, but then changed it to “Redux”, because in this case the return of the past is not an illusion, but an actual imitation of failed policies.  David Blackmon writes in Forbes Biden Seems Determined To Replay Obama Era Green Energy Failures.  Excerpts in italics with my bolds and images.

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Over the last few weeks, President Joe Biden and members of his administration have mounted a focused effort to sell massive new green energy spending to the American people.

Former Obama-era EPA Administrator Gina McCarthy, now the Biden White House climate adviser, is pushing Congress to include a federal clean electricity standard (CES) to drive investment in renewable energy and billions in subsidies to incentivize changeover further. Secretary of Energy Jenifer Granholm is doing the same.

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The fact McCarthy, and an official like Granholm who has a track record of failed green energy subsidies — are leading this effort makes this massive push all the more frustrating. These officials, well-meaning though they may be, should know by now that government energy subsidies overwhelmingly end up financing the well-connected rather than the most innovative, a concern I wrote about in a recent piece. The end result is wasted funds and harm to the sector that the government wants to help.

The trial that Elon Musk’s SolarCity has found itself in this week serves as a timely reminder of just how poorly the Obama-Biden green energy agenda went last time around. Beyond the regulatory and quality assurance issues his space company SpaceX and car company Tesla currently face, including recently violating an FAA launch license, Musk is now actively tangled in a legal battle from the solar panel manufacturer’s merger with Tesla. The billionaire stands accused of defrauding investors by not disclosing that the company was on the verge of bankruptcy and that it was highly risky for Tesla — itself a struggling company at the time — to take on SolarCity’s debt.

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SolarCity’s struggles were containable partly because it was awarded federal subsidies and nearly $500 million in Treasury grants. The Obama-Biden administration ended up wasting billions of taxpayer dollars with companies like SolarCity and Solyndra going broke or facing significant trouble soon after receiving the helping hand.

To give you an idea of the program’s effectiveness, the fact that SolarCity still technically exists despite its near-bankruptcy and $29 million settlement with the Department of Justice over the fraud case makes it one of the success stories.

Even when investments turn into actual infrastructure, consumers will be unlikely to reap the benefits. Many have championed the “progress” green energy has made over the last decade in providing a more competitive product, but the facilities are still failing, and the progress has been de minimis in terms of capturing global energy market share.

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Just last year, the Department of Energy watched as Tonopah Solar Energy LLC in Nevada declared bankruptcy after receiving a $737 million loan from one of their green energy programs. If you can’t make solar panels work in present-day Nevada, how do you expect them to fuel the energy needs of places like Colorado, where Sec. Granholm and Senator John Hickenlooper recently toured a solar garden?

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Utility companies that stand to receive billions in subsidies to upgrade their infrastructure support the measure because it will raise rates on consumers while reducing operating costs. Green energy is less efficient and less reliable, so the cost of operations will undoubtedly go up. But with the government covering the costs of setup and repair, it means more revenue with fewer expenses. This will help stockholders far more than working people.

But the calls from the climate change lobby for action are growing louder. Despite not making it into last month’s bipartisan infrastructure deal, many Democrats hope billions of dollars in green subsidies will find their way into a second infrastructure bill that party officials plan to pass through reconciliation. In fact, some Democrats are threatening to withhold their votes for the bipartisan bill unless they receive guarantees of energy provisions.

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Tehachapi’s dead turbines

Democrats have to pass these measures by party-line vote not because Republicans hate the environment (the GOP has a climate change caucus) but due to the fact that their plan is so costly and ill-advised that even moderate Republicans like Susan Collins and Mitt Romney can’t devise a rationale to reasonably offer support. The hard truth is that renewable energy technology isn’t currently capable of handling America’s growing energy demands and remains unlikely to do so in the future.

While the idea of renewable energy remains appealing, the reality is that fossil fuels, natural gas, and nuclear power will all be necessary to power our nation for decades to come.

Everyone should support innovation in the energy sector, but the subsidy-heavy plan that Democrats continue to push will only lead to wasted dollars and public backlash against a policy of failed projects. Congress has been down this road before. When the Green New Deal first came up, the bill was seen as so ridiculous that Speaker Pelosi wouldn’t even bring it up for a vote. Congressional Democrats should stick to that past wisdom and avoid falling back into this green subsidy trap.

As REN21, an advocacy group consisting of actors from science, governments, NGOs and industry, recently reported, this is a strategy that, from 2009 through 2019, produced virtually no real gain in overall green energy market share despite trillions of dollars in global targeted subsidies. A replaying of this same failed Obama-era strategy, managed by some of the very same officials, promises only to produce similarly failed results, albeit on an even grander scale.

Footnote Q & A:

Q:  What is the difference between Golf and Government?

A:  In Government you can always improve your lie.

–Anonymous Source

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SEC Warned Off Climate Disclosures

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David Burton writes to the Securities Exchange Commission explaining the hazards they will be taking on needlessly should they continue desiring to impose Climate Change Disclosures on publicly traded enterprises.  His document was sent to the SEC Chairman entitled Re: Comments on Climate Disclosure.  Excerpts in italics with my bolds.

Summary of Key Points

1. Climate Change Disclosure Would Impede the Commission’s Important Mission.

The important mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation. Mandatory climate change disclosure would impede rather than further that mission. It would affirmatively harm investors, impede capital formation and do nothing to improve the efficiency of capital markets.

2. Immaterial Climate Change “Disclosure” Would Obfuscate Rather than Inform.

The concept of materiality has been described as the cornerstone of the disclosure system established by the federal securities laws. Disclosure of material climate-related information is already required under ordinary securities law principles and Regulation SK. Mandatory “disclosure” of immaterial, highly uncertain, highly disputable information would obfuscate rather than inform. It will harm rather than hurt investors.

3. Climate Models and Climate Science are Highly Uncertain.

There is a massive amount of variance among various climate models and uncertainty regarding the future of the climate.

4. Economic Modeling of Climate Change Effects is Even More Uncertain.

There is an even higher degree of variance and uncertainty associated with attempts to model or project the economic impact of highly divergent and uncertain climate models. Any estimate of the economic impact of climate change would have to rely on highly uncertain and divergent climate model results discussed below. In addition to this high degree of uncertainty would be added an entirely new family of economic ambiguity and uncertainty. Any economic estimate of the impact of climate change would also have to choose a discount rate to arrive at the present discounted value of future costs and benefits of climate change and to estimate the future costs and benefits of various regulatory or private responses. The choice of discount rate is controversial and important. Estimates would need to be made of the cost of various aspects of climate change (sea level rises, the impact on agriculture, etc.). Estimates would need to be made of the cost of various remediation techniques. Guesses would need to be made about the rate of technological change. Guesses would need to be made about the regulatory, tax and other responses of a myriad of governments. Estimates would need to be made using conventional economic techniques regarding the economic impact of those changes which, in turn, would reflect a wide variety of techniques and in many cases a thin or non-existent empirical literature. Guesses would need to be made of market responses to all of these changes since market participants will not stand idly by and do nothing as markets and the regulatory environment change. Then, after making decisions regarding all of these extraordinarily complex, ambiguous and uncertain issues, issuers would then need to assess the likely impact of climate change on their specific business years into the future – a business that may by then bear little resemblance to the issuers’ existing business.

Then, the Commission would need to assess the veracity of the issuers’ “disclosure” based on this speculative house of cards. The idea that all of this can be done in a way that will meaningfully improve investors’ decision making is not credible.

5. The Commission Does Not Possess the Expertise to Competently Assess Climate Models or the Economic Impact of Climate Change.

The Commission has neither the expertise to assess climate models nor the expertise to assess economic models purporting to project the economic impact of divergent and uncertain climate projections.

6. The Commission Has Neither the Expertise nor the Administrative Ability to Assess the Veracity of Issuer Climate Change Disclosures.

The Commission does not have the expertise or administrative ability to assess the veracity, or lack thereof, of issuer “disclosures”  based on firm-specific speculation regarding the impact of climate change which would be based on firm-specific choices regarding highly divergent and uncertain economic models projecting the economic impact of climate changes based on firm-specific choices regarding highly divergent and uncertain climate models.

7. Commission Resources Are Better Spent Furthering Its Mission.

Imposing these requirements and developing the expertise to police such climate disclosure by thousands of issuers will involve the expenditure of very substantial resources. These resources would be much better spent furthering the Commission’s important mission.

8. The Costs Imposed on Issuers Would be Large.

Requiring all public companies to develop climate modeling expertise, the ability to make macroeconomic projections based on these models and then make firm-specific economic assessments based on these climate and economic models will be expensive, imposing costs that will amount to billions of dollars on issuers. These expenses would harm investors by reducing shareholder returns.

9.Climate Change Disclosure Requirements Would Further Reduce the Attractiveness of Becoming a Public Company,
Harming Ordinary Investors and Entrepreneurial Capital Formation.

Such requirements would further reduce the attractiveness of being a registered, public company. They would exacerbate the decline in the number of public companies and the trend of companies going public later in their life cycle. This, in turn, would deny to ordinary (unaccredited) investors the opportunity to invest in dynamic, high-growth, profitable companies until most of the money has already been made by affluent accredited investors. It would further impede entrepreneurial access to public capital markets.

10. Climate Change Disclosure Requirements Would Create a New Compliance Eco-System and a New Lobby to Retain the Requirements.

The imposition of such requirements would result in the creation of a new compliance eco-system and pro-complexity lobby composed of the economists, accountants, attorneys and compliance officers that live off of the revised Regulation S-K.

11. Climate Change Disclosure Requirements Would Result in Much Litigation.

The imposition of such requirements would result in much higher litigation risk and expense as private lawsuits are filed challenging the veracity of climate disclosures. These lawsuits are virtually assured since virtually no climate models have accurately predicated future climate and the economic and financial projections based on these climate models are even more uncertain. Litigation outcomes would be as uncertain as the underlying climate science, economics and the associated financial projections. This would harm investors and entrepreneurial capital formation.

12. Material Actions by Management in Furtherance of Social and Political Objectives that Reduce Returns must be Disclosed.

Many environmentally constructive corporate actions will occur in the absence of any government mandate or required disclosure. For example, energy conservation measures may reduce costs as well as emissions. No new laws or regulations are necessary to induce firms to take these actions. Assuming they are not utterly pointless, climate change disclosure laws presumably would be designed to induce management to take action that they would not otherwise take. To the extent management takes material actions in furtherance of social and political objectives (including ESG objectives) that reduce shareholder returns, whether induced by climate change disclosure requirements or taken for other reasons, they need to disclose that information. The Commission should ensure that they do so. Absent some drastic change in the underlying law by Congress, this principle would apply to any reduction in returns whether induced by ESG disclosures (climate change related or otherwise) or taken by management on its own initiative to achieve social and political objectives.

13. Fund Managers Attempts to Profit from SRI at the Expense of Investors Should be Policed.

Fund management firms are generally compensated from either sales commissions (often called loads) or investment management fees that are typically based on assets under management. Their compensation is not closely tied to performance. Thus, these firms will often see a financial advantage in selling “socially responsible” products that perform no better and often worse than conventional investments. It is doubtful that this is consistent with Regulation BI. Their newfound interest in socially responsible investing should be taken with the proverbial grain of salt. The Commission should monitor their efforts to profit from SRI at the expense of investors.

14. Duties of Fund Managers Should be Clarified.

The extreme concentration in the proxy advisory and fund management business is cause for concern. As few as 20 firms may exercise effective control over most public companies. The Commission should make it clear that investment advisers managing investment funds, including retirement funds or accounts, have a duty to manage those funds and to vote the shares held by the funds in the financial, economic or pecuniary interest of the millions of small investors that invest in, or are beneficiaries of, those funds and that the funds may not be managed to further the managers’ preferred political or social objectives.

15. Securities Laws are a Poor Mechanism to Address Externalities.

Externalities, such as pollution, should be addressed by either enhancing property rights or, in the case of unowned resources such as the air and waterways, by a regulatory response that carefully assesses the costs and benefits of the regulatory response. Securities disclosure is the wrong place to try to address externalities. Policing externalities is far outside of the scope of Commission’s mission and the purpose of the securities laws.

16. Climate Change Disclosure Requirements Would Have No Meaningful Impact on the Climate.

When all is said and done, climate change disclosure requirements will have somewhere between a trivial impact and no impact on climate change.

17. Efforts to Redefine Materiality or the Broader Purpose of Business should be Opposed.

Simply because some politically motivated investors seek to impose a disclosure requirement on issuers does not make such a requirement material. The effort to redefine materiality in the securities laws is part of an increasingly strident effort to redefine the purpose of businesses more generally to achieve various social or political objectives unrelated to earning a return, satisfying customers, or treating workers or suppliers fairly. This is being done under the banner of social justice; corporate social responsibility (CSR); stakeholder theory; environmental, social and governance (ESG) criteria; socially responsible investing (SRI); sustainability; diversity; business ethics; common-good capitalism; or corporate actual responsibility. The social costs of ESG and broader efforts to repurpose business firms will be considerable. Wages will decline or grow more slowly, firms will be less productive and less internationally competitive, investor returns will decline, innovation will slow, goods and services quality will decline and their prices will increase.

18.  ESG Requirements will Make Management Even Less Accountable.

In large, modern corporations there is a separation of ownership and control. There is a major agent/principal problem because management and the board of directors often, to varying degrees, pursue their own interest rather than the interests of shareholders. Profitability is, however, a fairly clear measure of the success or failure of management and the board. If a firm become unprofitable or lags considerably in profitability, the board may well replace management, shareholders may replace the board or another firm may attempt a takeover. Systematic implementation of regulatory ESG or CSR requirements will make management dramatically less accountable since such requirements will come at the expense of profitability and the metrics relating to success or failure of achieving ESG or CSR requirements will be largely unquantifiable. For that matter, ESG or CSR requirements themselves tend to be amorphous and ever changing.

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Alex Epstein on Energizing Puerto Rico

The video covers Alex Epstein’s full Congressional testimony on energy in Puerto Rico — including Q&A.  For those who prefer reading text, I provide below a transcript of most of it, with light editing transposing a spoken presentation into a written one.

Thank you for the honor of testifying before this committee.  What I say today will shock many of you. My views on energy are indeed unconventional, but I hope you hear me out with an open mind since we share the same goal: which is a flourishing and prosperous Puerto Rico.

I want to make the case that the one thing that will most help the people of Puerto Rico lift themselves out of crushing poverty is the thing many of you believe should be eliminated; and that’s low-cost reliable fossil fuel energy.

For just a brief moment I’d like to ask all of you to close your eyes. I’d like you to imagine an ambitious young Puerto Rican woman. I’ll call her Mia. Mia studied hard at the Emilio Delgado high school in Corusol. Mia’s passion is artificial intelligence, and she dreams of working at a high-tech startup. Sadly opportunities are sparse because many companies have fled Puerto Rico, and many more avoid it due to high cost and unreliable energy. So Mia applies for a remote job at a silicon valley tech incubator. But during her interview the electricity suddenly cuts out. The screen goes blank; she hopes it comes back quickly but hours go by with no internet as she waits in the sweltering heat with no AC. Think of Mia’s despair in those moments. Think of how much low-cost reliable energy could have helped her when she needed it most.

I know that every member of this committee shares the same goal I do: A healthy, prosperous and flourishing Puerto Rico. In order to help millions of talented and passionate people like Mia, we must look carefully at the full context of facts about Puerto Rico’s energy options. Here are three crucial facts that i almost never hear discussed about Puerto Rico and I want to highlight them.

First, the percentage of Puerto Ricans currently living in poverty is 43 percent.

Second, the cost of energy in Puerto Rico versus the states is up to three times higher

Third, the per capita income in Puerto Rico is $13, 000.

Honorable members does it strike you as fair that someone earning $13,000 per year should be paying three times what you and I pay for the energy that powers our homes? I don’t think that’s fair and I’m guessing you don’t think so either.

So what’s the solution? While we’re told that solar and wind can provide low-cost reliable energy, nothing could be further from the truth. Because solar and wind are unreliable; they don’t replace reliable power plants, they add to the cost of reliable power plants. The more wind and solar that grids use, the higher their electricity prices. German households have seen prices double in 20 years due to wasteful unreliable solar and wind infrastructure. Their electricity prices are three times ours, which are already too high due to solar and wind.

The only way for Puerto Rico to get low-cost reliable electricity anytime soon is using low-cost reliable fossil fuel energy sources like natural gas and coal, along with some massive regulatory reforms. I discuss in my written testimony actions such as scrapping the Jones act. We owe it to the people of Puerto Rico to give them the full context: The benefits and drawbacks of all their options. This includes recognizing any real coal ash problems, but also recognizing that there are many solutions to coal ash used around the world that don’t require shutting down power plants. Giving Puerto Ricans the full context also includes recognizing that fossil fuels CO2 emissions do impact climate. But it also includes being precise not hysterical about that impact. As I explain in my written testimony there is climate change, but not a climate crisis; and certainly not one that justifies condemning generations of Puerto Ricans to endless poverty by denying them low-cost reliable fossil fuel energy.

The stakes could not be higher. I think about Ellaria Davila who was breathing with the help of a mechanical ventilator. During prolonged blackouts her ventilator shut down and tragically she died. Her autopsy noted plainly that a ventilator “does not work without power.” Ladies and gentlemen: Nothing works without power, not the ventilators, not incubators, not farms nor schools. Not the millions of brave and passionate people who want to provide for their families and live lives of dignity and opportunity. You have it in your power today to help Puerto Ricans gain the power, the low-cost reliable power they need to escape crushing poverty.

I hope that any of you who are interested in this mission will join me on a fact-finding trip to Puerto Rico in the coming weeks. We will have an honest open discussion with Puerto Rican energy experts who are all too often left out of important policy discussions like this one. I would be honored to work with all of your offices, Democrat and Republican, to help the people of Puerto Rico flourish. I look forward to your questions and thank you again for the opportunity to share my perspective with you,

Q: Can you describe the benefits that affordable reliable energy has for communities in general?
A: Sure. Energy is the industry that powers every other industry; the lower cost and more reliable energy is the lower cost and more reliable everything is and vice versa. I just want to stress that Puerto Rico’s energy situation is terrible, and one of the reasons I want to testify today is because nobody is talking about that. They’re talking about, How do we maintain the status quo? The status quo is terrible in Puerto Rico. They desperately need more low-cost reliable energy.

And just a further comment. It doesn’t seem that people here know the facts and the percentages I noted about Puerto Ricans’ situation. For instance, I’m really disappointed that representative Ocasio-Cortez talks about shutting down the coal plant tomorrow. I don’t know if anyone knows what percentage of renewables the whole island has. So its’ 2.5%.

This is so disappointing that we’re talking about this so unseriously, when we really need to highlight the value of low-cost reliable energy and really talk about why Puerto Rico needs much more of it.

Q: In your opinion how will the Biden energy policies impact Puerto Rico?
A: It seems they’re going to make the rest of the US like Puerto Rico. I’m in California, and we’re already seeing this. In my work, I had two projects disrupted last year by blackouts.

We’re also seeing it in Texas. I don’t mean to pick on Representative Ocasio-cCortez, but she tweeted the infrastructures failures in Texas are quite literally what happens when you don’t pursue a green new deal. No, in fact plenty of places around the world can deal with hot and cold when they have enough reliable resilient electricity. Texas defunded reliable resilient electricity including winterization to pay tens of billions of dollars for unreliable solar and wind that don’t work when you need them the most. This energy policy is really the existential threat to talk about. It’s a threat to the US and to make Puerto Rico into a truly and consistently third world county.

Q: Mr Epstein in your testimony you noted that the most promising step that can be taken to lower emissions long term is the development of nuclear. Can you explain a little bit further why you believe nuclear energy Is more effective as a good alternative energy choice?

A: Sure.  It is so wrong that when we talk about potential alternatives to fossil fuels that nuclear is ruled out. You saw with the proposal of the green new deal there was anti-nuclear insistence on renewables which in practice means solar and wind. Renewable mandates usually exclude hydro as well.

This is totally the wrong approach if you’re looking for low carbon alternatives you have to be open to everything. And unfortunately the world is so anti-nuclear today that we’re shutting down record amounts of nuclear capacity this year, even though everyone claims to care about CO2 emissions.  In fact, nuclear provides extremely reliable on-demand power. Every grid in the world that works has on-demand power backing up solar and wind, since batteries do not exist anywhere.

If you’re concerned about coal ash, first of all you need to do real scientific studies that are systematic not just anecdotes and correlations. But if there’s a real problem we know how to solve coal ash problems. There are lots of ways to do that and if you don’t want to use coal in a given location, use natural gas or use nuclear. But the idea of mandating these unreliable solar and wind farms that make energy more expensive wherever they’re used, and then just manipulating data to ignore that fact, that policy is just absolutely devastating for Puerto Rico and anywhere else it’s applied.

In my testimony I noted this is being encouraged around the world by the US. We’re telling India to do this, and Indonesia to do this, places in Africa to do this to try to eliminate fossil fuels when that’s what they need to make their lives better. I think that’s really shameful and and I hope it stops.

Q: Mr. Epstein, you mentioned the need to consider the full context as we assess Puerto Rico’s energy generation. What what are the factors we should consider to understand the full context of the consequences that would stem from closing the AES coal plant?

A: Well, in general we just need to recognize that fossil fuels are the only way for them to get low-cost reliable energy for the foreseeable future. They need far more of it and there are very clear well-documented ways of using fossil fuels in a clean and responsible way. So the fact that there may be a problem with this particular plant, and again that needs to be scientifically studied so you come with a solution. It doesn’t mean we should shut it down; it means we should deal with the problems.

But more broadly, get rid of all the bad regulations and limitations that are preventing Puerto Rico from having low-cost reliable energy and flourishing.

Q: Are these things mutually exclusive? Can there be affordable and reliable energy today relying completely on renewable energy? 

A: I approach it a little bit differently because I think the world just undervalues low-cost reliable energy. Again this is fundamental to human flourishing, and this is something desperately needed around the world. Without low-cost reliable energy from fossil fuels people here can’t claim to care about life expectancy and health. These energy sources have driven down the rate of extreme poverty from over 40 percent people making less than two dollars a day to less than 10% in my lifetime. Access to energy is so important, yet billions of people still lack it. Four and a half billion people are living on less than ten dollars a day.

So my view is the world needs way more energy, and yes, we fortunately have modern technology that can produce it more and more cleanly. But to just look at the side effects of fossil fuels and not look at the benefits, you are condemning people to poverty, to suffering, condemning them to danger.

And I want to just remind everyone: A natural environment is not a good environment. Nature doesn’t give us a clean healthy environment, it gives us a very dirty and unhealthy environment. We need low-cost reliable energy to make the world a very livable place, and those of us who benefit from that in the US should really have sympathy for those in Puerto Rico, let alone the rest of the world that’s really really poor. And we should be doing nothing to impede them from using the most cost effective energy they can.

In conclusion, I would really welcome going on a fact-finding mission with many of you to look into the different energy realities. I think that we can see a way to move forward with cleaner coal, natural gas and nuclear instead of having this crazy dogma that we must rely on unreliable renewables. We should use the most cost-effective energy, and Puerto Rico needs far more of it not less.

Don’t Assume Global Warming Blunts Economic Growth

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In recent years, a strand of economic literature has argued that warming
not only negatively affects the level of economic activity,
but also the rate of income growth. PHOTO BY BLOOMBERG

Ross McKitrick explains in his Financial Post article Why climate change won’t hurt growth.  Excerpts in italics with my bolds.

There is no robust evidence that even the worst-case warming scenarios would cause overall economic losses

It has long been observed that global poverty tends to be concentrated in hot, tropical regions. But persistent poverty in African and South American countries has political and historical roots, especially their embrace of Soviet-backed communism in the 20th century. In places where economic reforms were adopted, like South Asia, growth took off and they quickly converged with the West, despite having tropical climates. So the connection to climate may be coincidental.

But in recent years, a strand of economic literature has argued that warming not only negatively affects the level of economic activity, but also the rate of income growth. This matters because when conducting an analysis over a 100-year time span, small changes in the growth rate can compound over a century and result in large total changes.

A 2012 study led by Melissa Dell of Harvard University presented evidence that warming had insignificant effects on income growth in rich countries, but in poor countries the effect was negative and statistically significant. Another team used this result in a policy model to argue that the “social cost of carbon” was at least 10 times higher than previously thought.

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This was followed up by several studies led by economists Marshall Burke of Stanford and Solomon Hsiang of Berkeley, who reported evidence that warming had significant negative effects on wealthy and poor countries alike. Suddenly a picture emerged that warming is much more harmful than we thought, so it should be full steam ahead on aggressive climate policy. Global policymakers have embraced this belief, in part at the urging of the United Nations Intergovernmental Panel on Climate Change’s (IPCC) 2018 special report on global warming of 1.5 C, which highlighted this research.

But other research tells a different story. One of the challenges in climate economics is that climate data are collected on a grid cell basis (organized in latitude-longitude boxes), while economic data is collected at the national level. To match them up, Dell’s group averaged the climate data up to the national level. There are different ways of doing the averaging, however, and the results are sensitive to the chosen method.

Other teams have begun trying to build economic data sets at the local and regional level so the averaging step can be omitted. One group from Northern Arizona University used grid cell-level economic data from around the world and found, like Dell, that warming temperatures has no effect on growth in rich countries, but they found it has a positive effect in poor countries up to an average temperature of about 17.5 C, which is above the sample average temperature of 14.4 C.

Then a team from Germany developed a regional economic database that lets them account for what economists call “country fixed effects,” namely, unobservable historical and institutional factors specific to each country that are unrelated to, in this case, the climate variables.

When they apply this method, the climate effects on growth and output vanish for rich and poor countries alike.

More recently, a group led by Richard Newell of Resources for the Future raised the issue that the econometric modelling can be done many different ways. Given the same data set, there are lots of decisions to make, such as how many lagged effects to include, whether to use linear or nonlinear equations and whether to use time trends. Altogether, they counted 800 different ways the same data could be analyzed.

In order to determine whether the results depend on the choice of models, they obtained the data set used by the Burke team and used the same country-level averaging method employed by Dell’s team. Then they ran a meta-analysis in which they ran all the possible models and evaluated at how well each one fit the data, in order to identify the best-performing models to reach their conclusions.

Dozens of different models all fit the data about equally well, and they could not rule out that the best ones do not include any role for temperature in economic growth. There was some evidence that warming is good for growth up to 13.4 C, but the positive and negative effects were not statistically significant.

Across the entire range of temperatures in the sample there was no significant influence of climate on either output or growth.

Under the highest-warming scenario, the Burke team had projected a 49 per cent global GDP loss from climate change by 2100, but Newell found the model variant that fits their data best implied a slight global GDP gain. The best growth models as a group project an effect on GDP by 2100 ranging from -84 per cent to +359 per cent, with the central estimates very close to zero. In other words, the effects are too imprecise to say much of anything for certain.

Now we come up against the challenge that policymakers seem to find it easier to deal with gloomy certainty than optimistic uncertainty. In the blink of an eye, a handful of studies in a new research area had become the canonical truth, on which governments swung into a much more aggressive climate policy stance.

But as time has advanced, new data sets, and even reanalysis of the old data sets, has called those results into question and has shown that temperature (and precipitation) changes likely have insignificant effects on GDP and growth, and the effects are as likely to be positive as they are to be negative. This does not mean there aren’t specific regions and specific industries where there are potential losses, especially if the countries don’t adapt. But for the world as a whole, there is no robust evidence that even the worst-case warming scenarios would cause overall economic losses.

It now falls to advisory groups like the IPCC to tell this to world leaders, before they enact any more disastrous climate policies that will do all the harm (and more) that the evidence says climate change itself will not do.

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Footnote:  There are also economists pushing the notion of direct costs from global warming/climate change due to supposed increasing health and prosperity impacts from extreme weather.  This is contrary to IPCC approved studies by economist William Nordhaus.  See IPCC Freakonomics

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Exposing Net-Zero Doublethink

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Bjorn Lomberg exposes the doublethink rhetoric around the “Net-Zero” carbon emissions notion in his Financial Post article Enough with the net-zero doublethink Excerpts in italics with my bolds and images.

When John Kerry and many other politicians insist that climate policies mean no sacrifice, they are clearly dissembling.

Our current climate conversation embodies two blatantly contradictory claims. On one side, experts warn that promised climate policies will be economically crippling. In a new report, the International Energy Agency (IEA) states that achieving net-zero in 2050 will likely be “the greatest challenge humankind has ever faced.” That is a high bar, surpassing the Second World War, the black plague and COVID.

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On the other side, hand-waving politicians sell net-zero climate schemes as a near-utopia that every nation will rush to embrace. As U.S. climate envoy John Kerry told world leaders gathered at President Biden’s climate summit in April: “No one is being asked for a sacrifice.”

Both claims can’t be true. Yet, they are often espoused by the same climate campaigners in different parts of their publicity cycle. The tough talk aims to shake us into action, and the promise of rainbows hides the political peril when the bills come due.

George Orwell called this willingness to espouse contradictory claims doublethink. It is politically expedient and gets climate-alarmed politicians reelected. But if we want to fix climate change, we need honesty. Currently promised climate policies will be incredibly expensive. While they will deliver some benefits, their costs will be much higher.

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Yes, climate change is real and man-made, and we should be smart in fixing it. But we don’t because climate impacts are often vastly exaggerated, leaving us panicked. The UN Climate Panel estimates that if we do nothing, climate damages in 2100 will be equivalent to 2.6 per cent of global GDP. That is a problem but not the end of the world.

Because climate news only reports the worst outcomes most people think the damage will be much greater. Remember how we were repeatedly told 2020’s Atlantic hurricane season was the worst ever? The reporting ignored that almost everywhere else, hurricane intensity was feeble, making 2020 one of the globally weakest in satellite history. And even within the Atlantic, 2020 ranked thirteenth.

When John Kerry and many other politicians insist that climate policies mean no sacrifice, they are clearly dissembling. In the UN Climate Panel’s overview, all climate policies have real costs. Why else would we need recurrent climate summits to arm-twist unwilling politicians to ever-greater promises?

The IEA’s new net-zero report contains plenty of concrete examples of sacrifices. By 2050, we will have to live with much lower energy consumption than today. Despite being richer, the average global person will be allowed less energy than today’s average poor. We will all be allowed less energy than the average Albanian used in the 1980s. We will also have to accept shivering in winter at 19°C and sweltering in summer at 26°C, lower highway speeds and fewer people being allowed to fly.

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But climate policy sacrifices could still make sense if their costs were lower than the achieved climate benefits. If we could avoid the 2.6 per cent climate damage for, say, one per cent sacrifice, that would be a good outcome. This is common sense and the core logic of the world’s only climate economist to win the Nobel Prize (2018 laureate William Nordhaus of Yale). Smart climate policy costs little and reduces climate damages a lot.

Unfortunately, our current doublethink delivers the reverse outcome. One new peer-reviewed study finds the cost of net-zero just after 2060 — much later than most politicians promise — will cost us more than four per cent of GDP by 2040, or about $5 trillion annually. And this assumes globally coordinated carbon taxes. Otherwise, costs will more than double. Paying eight per cent or more to avoid part of 2.6 per cent damages half a century later is just bad economics.

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It is also implausible politics. Just for China, the cost of going net-zero exceeds seven to 14 per cent of its GDP. Instead, China uses green rhetoric to placate westerners but aims for development with 247 new coal-fired power plants. China now emits more greenhouse gases than the entire rich world.  Most other poorer countries are hoping to follow China’s rapid ascendance. At a recent climate conference, where dozens of high-level delegates dutifully lauded net-zero, India went off-script. As other participants squirmed, power minister Raj Kumar Singh inconveniently blurted out the truth: net-zero “is just pie-in-the-sky.” He added that developing countries will want to use more and more fossil fuels and “you can’t stop them.”

If we push on with our climate doublethink, rich people will likely continue to wring their hands and aim for net-zero, even at considerable costs to their own societies. But three-quarters of future emissions come from poorer countries pursuing what they regard as the more important development priorities of avoiding poverty, hunger and disease.

Like most great challenges humanity has faced, we solve them not by pushing for endless sacrifices but through innovation. COVID is fixed with vaccines, not unending lockdowns. To tackle climate, we need to ramp up our investments in green energy innovation. Increasing green energy currently requires massive subsidies, but if we could innovate its future price down to below that of fossil fuels, everyone would switch. Innovation is the most sustainable climate solution. It is dramatically cheaper than current policies and demands fewer sacrifices while delivering benefits for most of the world’s population.

Bjorn Lomborg, president of the Copenhagen Consensus, is a visiting fellow at the Hoover Institution, Stanford University. His latest book is “False Alarm: How Climate Change Panic Costs Us Trillions, Hurts the Poor, and Fails to Fix the Planet.”

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