Bingaman expresses doubts about rip-offsets

I think rip-offsets are well, a rip-off, especially as a major cost-containing measure for climate regulations (see here). But I haven’t seen many leading legislators diss them.

So I confess to being quite surprised that the chairman of the Senate Energy and Natural Resources Committee, Jeff Bingaman (D-N.M.) said at a conference Wednesday:

“I think this whole issue of offsets, the more I’ve read about this issue, both international and domestic offsets, are fraught with opportunity for game playing, which will be fully exploited, I’m sure. We have a lot of creative people who can find ways to find offsets and to verify offsets if we open that door to occur.”

E&ENews PM (subs. req’d) has the story:

A key senator involved in writing global warming legislation expressed skepticism today about allowing companies to fund environmentally friendly projects as an alternative to meeting strict new emission reduction requirements in a new U.S. climate law.,,,

Both House and Senate bills proposed earlier this year would allow companies to use offset credits — such as payments to landowners who plant trees, erect methane digesters or practice no-till farming — for compliance.

But Bingaman signaled that he is among the critics who question whether the offset projects would lead to real reductions in heat-trapping emissions.

I think there’s a tendency from a political point of view to set very aggressive targets so that we can tell everybody we’ve set very aggressive targets, and then at the same time enact such a robust system for offsets that nobody has to meet targets in a real way,” Bingaman said.

“The emissions don’t have to be actually reduced,” the senator said. “Instead, everyone can buy offsets that turn out not to have resulted in additional emission reductions. We need to think through that.”

My hero! At a policy level, offsets can destroy the environmental value of climate legislation:

As a major 2008 analysis from Stanford found “between a third and two thirds” of emission offsets under the Clean Development Mechanism (CDM) — set up under the Kyoto treaty to encourage emissions reductions in developing nations — do not represent actual emission cuts. And this led to the study’s stark conclusion: “any offset market of sufficient scale to provide substantial cost-control for a cap-and-trade program will involve substantial issuance of credits that do not represent real emissions reductions.

The Senate bill debated legislation last spring from Sens. Joe Lieberman (I-Conn.), John Warner (R-Va.) and Barbara Boxer (D-Calif.) that placed a 15 percent limit on domestic offsets and a 15 percent limit on international offsets. Some lawmakers, including Sen. Debbie Stabenow (D-Mich.), wanted more. By contrast, a draft House bill from Energy and Commerce Chairman John Dingell (D-Mich.) and Energy and Air Quality Subcommittee Chairman Rick Boucher (D-Va.) released last month would limit offsets to no more than 5 percent for the cap-and-trade program’s first five years, with a gradual increase as the emission limits get stronger.

Bingaman’s offset comments caught many at the climate conference by surprise — in no small part because these are the people who work to develop and fund such projects. “It felt a little bit out of date,” said one environmentalist, who cited the growing consensus among conservation groups that there’s a need to focus on land-use efforts to meet any domestic emission limits.

It’s hard to imagine getting to 2050 targets without offsets,” this source added.

I’d love to know who this source is. There is no such “growing consensus.” The actualy growing policy consensus is that by 2050, we shouldn’t be funding any offsets at all! Every emissions reduction that is credible needs to be in the cap. Preserving the tropical rain forests is not an offset. That needs to be dealt lives at the level of national accounting, which the United Nations is working on (see here).

In remarks to reporters, Bingaman stressed that no decisions have been made on the outlines of a climate bill that would advance under the Obama administration. Still, the New Mexico Democrat said he had a vision on the schedule for action that pushes enactment beyond 2009.

“I do believe that we need to make every effort, and this administration needs to make every effort, to enact major energy legislation and major climate change legislation in the nature of a cap-and-trade system in this upcoming Congress,” he said. “I wouldn’t limit it to the first year. I think the reality is, it may take more than the first year to get it all done.”

Bingaman said he would prefer starting next year with energy legislation, including a renewable portfolio standard that sets a nationwide goal for using wind and solar power. He did not offer other details, except to say he would look for ideas left out of energy laws adopted in 2005 and 2007.

“We’re not sure what might be in a new energy bill, but we’re talking about trying to formulate a new energy bill for early in the new Congress,” he said.

Asked if he had spoken yet to transition leaders for President-elect Barack Obama about an energy bill, Bingaman replied, “We don’t have a new administration yet. We’re just talking amongst ourselves.”

To have any chance whatsoever of avoiding catastrophic climate impacts, we need to keep offsets both limited and temporary. Kudos to Bingaman.

6 Responses to Bingaman expresses doubts about rip-offsets

  1. Paul K says:

    Can you give some examples of offsets that are not rip-offs?

  2. william says:

    I read on Google News today ( that Senator Bingamen said the Congress won’t get around to dealing with climate change until 2010, “despite President-elect Obama’s declaration that he will move quickly to address climate change.”

    Mr. Romm always blames republicans for climate inaction. Bingamen, however, is a democrat. Moreover, a friend of mine told me that 10 Senators from the Democratic Party wrote a letter last summer to Barbara Boxer, stating that they couldn’t support the cap and trade bill that her staff wrote and which was put before the Senate for a vote. That’s 20% of the Democrats in the Senate!

    What gives? It seems that both political parties oppose serious action on the climate.

  3. Katy Y says:

    ” ‘It’s hard to imagine getting to 2050 targets without offsets,’ this source added.”

    This phrase sounded awfully familiar, and then I remembered reading in Carbon Market North America (see Oct 31 issue, that the Nicholas Institute Institute for Environmental Policy Solutions had stated a similar phrase: that allowing offsets in a US federal C&T program is necessary to lower costs and make a stringent emissions cap politically viable.

    So the cause for stasis by both political parties seems to come down to a question of costs. Not the environmental costs that come from climate change or the social costs from poor air quality or more variable (and dangerous) weather patterns. And if we allow CDM projects into any of our climate policies, watch out. What looks like supporting developing countries is really locking them into incredibly harmful practices (see

  4. Scatter says:

    “Can you give some examples of offsets that are not rip-offs?”

  5. hey joe, what you doing with that gun in your hand? says:

    it really does amaze me how closed-minded you’ve become to an issue on climate change. you yourself know that there are many energy efficiency savings that are estimates and are prone to some sort of margin of error. so if i give you one study showing these errors will it forever change your view? i doubt it. but one study on offsets has substantiated your seemingly predetermined conclusion…troubling. what is your solution for reductions in developing countries then? do you propose a safety valve like stanford proposes to help control costs? won’t this hurt efficiency?

    [JR: What?! I have worked with dozens of companies directly over the year on applying energy efficiency, so I don’t really need to see any theoretical studies. As for offsets, if you read all of the articles in the offset category, you’ll see this isn’t just one study — it is lots of analyses and articles questioning offsets. Offsets do NOT help efficiency — they hurt it, since they offer phony alternatives to real action. I do not want to control costs (through a safety valve), I want to control emissions. The only way to control costs is to a very aggressive technology deployment program and smart utility regulations to finally put efficiency of a level playing field with supply.]