Gov. Sarah Palin (R-AK) has garnered much attention for her op-ed in the Washington Post attacking President Obama’s clean energy policies as “an enormous threat to our economy.” Palin is positioning herself as the face of the opposition to the American Clean Energy and Security Act, legislation that would establish federal standards for renewable electricity, energy efficiency, and global warming pollution. But New Energy Finance, “the world’s leading provider of industry information and analysis to investors, corporations and governments in clean energy, low carbon technologies and the carbon markets,” argues the “Thrilla From Wasilla” may actually end up helping clean energy reform become a reality:

NEF “FIRST TAKE”: Palin’s popularity among the right wing of the Republican Party stems mainly from her stances on cultural issues such as opposition to abortion. So it is intriguing that she has chosen an economic issue to pursue immediately after leaving office. Most likely, this represents an attempt to broaden her appeal to economic conservatives in the party as well ahead of 2012. In addition, energy policy is an area where Palin has some expertise, having chaired a key energy committee in Alaska after serving as mayor of the town of Wasila but before winning the governorship. That said, Palin’s reputation for zany off-the-cuff comments precedes her. While she is knowledgeable in this area, she is also bound to stray well off message and create memorable sound-bites. Advocates for cap-and-trade should welcome her to the debate with open arms.

Fred Hiatt‘s decision to publish yet another global warming denier in the Post is an embarrassment, and Palin’s energy “expertise” is a gross exaggeration. But taking NEF’s advice, let’s hope Palin doesn’t figure that out. Go, Sarah, go!

Over and over again, in e-mails and comments and blog posts, I hear some enviros saying that it doesn’t matter if Waxman-Markey fails, since EPA can use the endangerment finding to regulate CO2 as well or better.  That dangerously mistaken view would appear to be creating a dangerous apathy among many progressives and environmentalists, as I’ll discuss shortly.

Certainly, the finding was a major environmental achievement by this administration (see “EPA finds carbon pollution a serious danger to Americans’ health and welfare requiring regulation“).  But it can’t take the place of Congressional action for three key reasons:

1. “It would be difficult for the EPA to enact a CO2 cap and trade without congressional cooperation,” as John Podesta, former Clinton Administration Chief of Staff and now CEO of CAP, recently said.  The endangerment finding is far better suited to addressing new sources that it is existing sources.
2. A subsequent president could trivially stop or endlessly delay whatever actions Obama was able to start with the EPA.
3. If Congress rejects the binding targets of W-M, then we have no basis for negotiating with other countries as part of the UN Framework Convention on Climate Change process.  Indeed, we would have no basis for a deal with China.  A promise by Obama that he would try to use the limited authority EPA has to commit to a modest cut in CO2 by 2020 — and deep cuts in 2030 and 2050 — would be seen as meaningless.

Let me expand on the first point.

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Senate Environment and Public Works Chairwoman Barbara Boxer (D-Calif.) plans to unveil a major global warming bill immediately after Congress returns from the August recess, she said today….

Boxer predicted she would have at least one Republican co-sponsor on her bill, though she would not name names.

So E&E News PM (subs. req’d) reported last night.  I see this delay as a sign that she is serious about trying to craft a bill that can garner 60 votes, which will not be easy (see “Epic Battle 3“).  I don’t think the Republican cosponsor will be someone from the committee.  Maybe it will be one of the two Maine senators.

How will all the different pieces by different committees be reconciled?

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We knew new nukes were absurdly expensive (see “Areva has acknowledged that the cost of a new reactor today would be as much as 6 billion euros, or $8 billion, double the price offered to the Finns.”).  Now we know they are literally unaffordable.

Our friend and fellow blogger, Tyler Hamilton — who actually has a real job as senior energy reporter for the Toronto Star — published this stunning news in Canada’s largest daily newspaper:

The Ontario government put its nuclear power plans on hold last month because the bid from Atomic Energy of Canada Ltd., the only “compliant” one received, was more than three times higher than what the province expected to pay, the Star has learned.

Sources close to the bidding, one involved directly in one of the bids, said that adding two next-generation Candu reactors at Darlington generating station would have cost around $26 billion.

It means a single project would have wiped out the province’s nuclear-power expansion budget for the next 20 years, leaving no money for at least two more multibillion-dollar refurbishment projects.

“It’s shockingly high,” said Wesley Stevens, an energy analyst at Navigant Consulting in Toronto.

So nuclear bombshells have now been dropped on Canada, Finland, Turkey (see “Turkey’s only bidder for first nuclear plant offers a price of 21 cents per kilowatt-hour“) and this country (see “What do you get when you buy a nuke? You get a lot of delays and rate increases”¦.“).

Now you may be saying, wait a minute, Joe, hasn’t Areva said it would deliver a single plant for $8 billion, so that should work out to a Walmart-style $16 billion price, rather than AECL’s Tiffany-style offer.  Hamilton has more juicy details:

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Biofuels have been overhyped as a climate solution for a long time — see “Are biofuels a core climate solution?“  The holy Grail, cellulosic biofuels, remain as distant as ever:

Following fraud case, U.S. unlikely to hit 2010 cellulosic target

Grassoline it ain’t. After a jury ordered a leading cellulosic biofuel company to pony up millions for defrauding investors, the U.S. Environmental Protection Agency will likely come in 60 million gallons shy of its 100 million gallon target next year.

Late last month, a federal court in Mobile ordered Cello Energy of Bay Minette, Ala., to pay $10.4 million in punitive damages for fraudulently claiming it could produce cheap diesellike fuel from hay, wood pulp and other waste….

Cellulosic biofuel technology is still in its infancy, and the agency and Congress required gasoline blenders to purchase and sell just 100 million gallons next year, less than 1 percent of the nation’s proposed renewable fuel mandates….

For George Huber, the University of Massachusetts Amherst chemical engineering professor who wrote Scientific American‘s July cover story about cellulosic biofuels, Cello is a lesson to be learned. “There are no magic processes for conversion of biomass into liquid fuels,” he says, “If something sounds too good to be true, it probably is not true.”

Climate change could redraw national borders

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I have written a lot of posts critical of international and domestic offsets.  And I’d love to see the climate bill sunset the rip-offsets.   George Monbiot argues “large scale carbon offsets can’t work.”  More recently, I have spent a lot of time talking to leading experts and analyzing the international market, which has led me to realize that large-scale, inexpensive international offsets don’t exist nor will they (see “Do the 2 billion offsets allowed in Waxman-Markey gut the emissions targets?“) — whereas large-scale inexpensive domestic emissions reductions strategies do (see “the 2020 Waxman-Markey target is so damn easy and cheap to meet“).  Certainly, offsets haven’t gutted the Europe’s Kyoto targets under their trading system (see “Europe poised to meet Kyoto target: Does this mean the much-maligned European Trading System is a success?“).  Since this is such an important subject, I asked Elizabeth Zelljadt, an analyst at Point Carbon, for her perspective on the subject.  Point Carbon is a leading provider of information and analysis on the international carbon market.

The Clean Development Mechanism (CDM) has gotten a lot of attention after the recent release of a report by two environmental groups which argued that the CDM and the entire idea of offsets should be abandoned because offset projects can’t be proven additional to business-as-usual. The report also objected to offsetting as an easy way out for emitters.

While some criticism of the CDM is well-grounded, much of the debate around this international offset program would definitely benefit from better information. As the leading carbon market intelligence provider and the proprietors of the largest database of CDM projects, we at Point Carbon offer some data-driven insights as a contribution to the discussion.

First off, let’s make sure we define the CDM, as it is often confused with other groups or firms selling credits to offset your latest plane flight or a portion of some large company’s carbon footprint. Those are voluntary offsets, whereas the CDM is part of the Kyoto Protocol, an international agreement under which countries have taken on binding emission reduction commitments. Offsets used for compliance to this mandatory global program are vetted by the UN. They are called CERs (certified emissions reductions) and represent tradable units companies and countries can use to fulfill their requirements under the treaty. CDM projects “generate” CERs when they reduce emissions compared to a baseline: 1 CER = 1 metric ton of CO2-equivalent reduced. Currently, CERs cost in the range of $15-17 – at least twice as much as your average voluntary offset.

Just a year ago, CER prices were even higher – as the chart below shows, they went down considerably with the slumping economy. Large emitters in the countries that buy CERs (mostly Europe and Japan) saw decreasing industrial production and therefore lower CO2 output, in turn decreasing their need for offsets and thus bringing down the CERs price. Given that the economy is expected to pick up over the next few years, CER prices could get back into the ‚¬18-20 ($25-28) range.

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