Tuesday, November 30, 2010

More on coal and states

Today's accomplishment: tracking down a bunch of new info on coal-by-state stuff. This led to lots of little observations that interested me, but most importantly, I can start talking a little more intelligently about the importance of coal by state! Sadly, I still don't have the industry-as-a-percent-of-state-income numbers, but I can talk about two other useful measures:

1) Employment: this is just numbers of people actually employed in coal mining, so it's by no means a sum total of all coal-related employment. In fact, even in the coal-heaviest states, as a percent of the workforce, it's still only 2.5% or so. I'm making the assumption that the ranking of states this produces, however, roughly tracks to the ranking that would be produced by a more complete accounting. This yields a list of states of interest as follows:

Effect Seems Highly Likely:
West Virginia
Wyoming

Effect Seems Possible:
Kentucky
North Dakota
Montana
Alabama

Effect Seems Unlikely:
New Mexico
Utah
Pennsylvania
Virginia
Indiana

2) Use of coal for electricity (again, this should be converted to percent of power generated from coal, but... I didn't find the right numbers for that today, so we're going with raw numbers):

Texas
Indiana
Illinois
Ohio
Pennsylvania
Missouri
Kentucky
Michigan
Georgia

Though I clearly need to rerun this with percentages to eliminate the state size issue, it's not a pure restatement of size. California, New York, and Florida fall off the list, while Missouri moves up significantly. Hard to say what this means, other than that CA, NY, and FL don't burn as much coal as the "should" while Missouri burns more.

So, comparing the three lists:

Using coal/oil production as a metric gives us: Wyoming, West Virginia, Kentucky, Pennsylvania, Texas, Montana, Alaska, and Louisiana

Using percent of workforce employed in coal/oil yields: West Virginia, Wyoming, Kentucky, North Dakota, Montana, Alabama, Texas, Alaska, Louisiana (I add the final three to account for oil; haven't run the numbers but am pretty confident they'll pan out).


Using raw coal electricity numbers gives, though this list probably isn't very useful in its current form: Texas, Indiana, Illinois, Ohio, Pennsylvania, Missouri, Kentucky, Michigan, Georgia (oil isn't generally burned much for fuel, though I should check to see if there are any exceptional states.)

Once I've got the coal electricity numbers worked out as percentages of total generation, and updated the list, it would be interesting to see if one of the lists predicts voting better than another - though the sample sizes are to small, I suspect, to have any rigorous meaning.

Monday, November 29, 2010

Coal industry quotes

In meetings most of the day. Therefore, quotes from coal industry people!

"Palmer had founded the pro-CO2 Greening Earth Society in 1998 to convince people that burning fossil fuels is 'doing the work of the Lord.'" (Fred Palmer of Peabody Energy, the largest US coal producer)

"Blankenship warned that 'the greeniacs are taking over the world,' and painted a grim picture of what American life would be like under 'people of the far-left Communist persuasion.' ... 'I have spent quite a bit of time in Russia and China and India, and I can tell you, that's the first phase. You go from having your own car to carpooling to riding the bus to riding mass transit and you eventually get down to where you're walking. Your apartments go from being nice apartments and homes with your own bathroom to sharing kitchens and bathrooms with four families. That's what socialism and the elimination of capitalism and free enterprise is all about.'" (Don Blankenship, CEO of Massey Energy, the fourth largest US coal company)

Quotes from Pooley's The Climate War, which I'm still wandering through and which, if it's not obvious, I recommend.

Friday, November 26, 2010

Messing around with cap and trade

And for Friday, because I'm full of turkey and it's a holiday weekend, a quick and totally speculative post that I've been thinking about for a bit.

Cap-and-trade programs as proposed in the US appear to me to generally operate through a centralized allowance distribution model. So for instance, in the case of SO2, initial allowances were as I understand it distributed by the EPA (with some hands-on fiddling and extra-allowance-granting by legislators). Waxman-Markey as far as I can tell had the same model - determination and distribution of allowances by the EPA.

What I've been wondering this week is whether a more distributed model would be more politically viable. What if, instead of the EPA allocating allowances directly to companies, it allocated allowances to communities, allowing those communities to auction off allowances to the companies, and local governments to keep the proceeds?

I don't have a good sense of how local governments work in a general sense, or what the legal relationship between federal and local government is and whether existing political arrangements would, from a practical point of view, allow such a system. I'm also pretty sure such a system would not be as efficient or effective a process as having the EPA do it - best-case, it would probably be bureaucratically unwieldy and allow each individual community to make individual, stupid decisions about allocation - which some of them might indeed do. Still, the classic version of CO2 cap-and-trade died an ignominious death, largely because its defenders couldn't articulate to voters what immediate, tangible benefits it will give them to balance out potential costs. Giving local governments allowances to allocate and/or auction off themselves would be one way of putting skin in the game at a community level, of making the proceeds from an auction system tangible to voters, and of giving communities a sense that climate action is something they have some on-going control of and ability to shape to their individual community's needs.

Message vs. audience

From my reading on Wednesday, which was more Climate War (Pooley), more stuff on environmental messaging strategy. Pooley describes the Alliance for Climate Protection's initial messaging strategy, which was intended to build their "brand" and establish them as a known, non-threatening brand (the Alliance is the group Al Gore spearheads):
They had established the brand but their message was getting buried under a mountain of look-alike ads from fossil fuel companies. In the Alliance's tracking polls, the percentage of people who saw the crisis as urgent was starting to fall off because of all of those oil, gas, and coal ads saying, It's solvable. Don't worry about it. We're on it. ExxonMobil had people in lab coats in their ads, and Americans trust scientists and technicians. The clean coal people had an "I believe" spot that looked and felt like an Obama commercial.
There are multiple kinds of strategy a messager can apply to messaging. One is the kind I talked about earlier, where, in essence, you fit the people to the message - you pick the people who will be receptive to the kind of message you want to send. This is the other kind, in which you fit the message to the people. My intuition is that the second kind is inherently less effective: anyone can do it, and it's unclear that one message fitted to a given audience is likely to be more sticky than another (whereas a message targeted at a group that is particularly prone to be receptive to that message may be very sticky indeed). If true, this is likely to be especially true of messages like the one described above, for the reason described above: whatever is catchy about a message targeted to many people at once is also likely vague enough to be easily imitated by competitors.

This is of course one of the many areas tangential to what I'm working on where I end up thinking, "There's probably research out there on this concept already," but don't actually have the time to follow up, since it is, in fact, tangential.

Tuesday, November 23, 2010

A thing I did not know...

Current reading: Smart Power, by Peter Fox-Penner.

Here's a random fact I did not know: power demand and power generation in a power system have to be kept in balance. There has to be as much power going in as there is coming out - neither more nor less. That makes sense. What I didn't realize (though it's logical when you think about it) is that this is actually achieved by turning off and on power plants. During slack demand, there are power plants that are shut off or idling. When peak demand hits, these plants get turned on. The plants that run all the time are the ones that are most efficient; the plants that get turned on to meet peak demand are the less efficient, often older plants which cost more money to run. This is the physical reason behind variable power pricing: peak power is not simply subject to higher demand, it's more expensive to produce.

Other potential ways of balancing include consumption management through tactics like demand response pricing, energy storage within the system, and distributed generation - all of which are components of the so-called "smart grid", and all of which we haven't historically had the tools to do effectively.

Monday, November 22, 2010

Existential threats in negotiation

One of my bibles for climate negotiation research is Scott Barrett's Environment and Statecraft, which is a tome filled with a very, very great deal of discussion of the game theory that people have used to think about environmental negotiation. I've fought my way through one read of it, and it's one of those books that I'm clearly going to have to go through multiple times to make sure I've worked through it thoroughly.

Here's one initial thought, however. Barrett's game theoretic models suggest that when looking at multilateral environmental treaty-making, the ability to get more and more people to sign on is decreasing with relationship to the benefit of the environmental mitigation in question, and increasing with relationship to the cost of the mitigation. That is, the larger the benefits of mitigation action required by a treaty, the fewer signatories you'll get, while the greater the costs of mitigation, the more signatories you'll get.

This at first seems counter-intuitive (it did to me, at least) but I think the intuition is this: all parties are assumed to be behaving strategically. Parties know that if the benefits of mitigation are greater, they can more confidently assume that other actors will choose to mitigate in order to attain those benefits. Therefore, they can more confidently choose not to sign, planning to free-ride. Conversely, when the costs are higher, you need more total benefits to balance out costs (remember, the benefits of mitigation are assumed to be public goods, so each party to a treaty pays only for its own share but receives benefit equal to the total benefits created by all parties), and treaties will fail to occur if they don't get enough signatories. Since potential signatories know this and (we assume) desire the total potential payoffs from a successful treaty, more will sign, in order to reach the tipping point.

There's a wrinkle to this, though, that Barrett doesn't address but which I think is important to climate negotiations. That is that if parties are facing an existential threat, the benefits of mitigation are essentially infinite. Logically, therefore, by Barrett's model, if willingness to sign treaties decreases as size of benefits to mitigation increases, it should be nearly impossible to get countries to sign on to treaties in cases where the treaties deal with an existential threat. Each country should be able to confidently expect that, even absent a treaty, each other country must nonetheless rationally choose to take every possible action to mitigate, because if the risk of not doing so is an existential one, it would be suicidal not to. The implication of this is that persuasive tactics at the international level that involve emphasizing the possible existential nature of the costs of failure to mitigate (and hence the size of potential benefits to mitigation) could actually be counter-productive.

I'm not sure I believe this as a representation of how states think in general - I'm not convinced states will typically play chicken in this way. But I think there's a variant that's plausible that assumes ambiguity. Let's say you're a Chinese government official, and  you're negotiating with European diplomats over an emissions reduction treaty. The European officials, along with a bunch of Western NGOs, are busily trying to convince you that climate change represents an existential threat and therefore you should do something about it - in spite of the fact that it could damage you materially by slowing growth and destabilizing you politically. You believe in a general sense in the problem, but are uncertain how seriously you take the immediacy and scale of it. You're a rising world power and don't want to get played, either into taking action that isn't really necessary, or into taking on more than your share of efforts that are necessary (thus assuming a competitive disadvantage). You think it's entirely possible that your negotiating partners might be exaggerating their true beliefs about costs in order to convince you to cooperate.

Under these conditions, refusal to cooperate is potentially the right move strategically. If the threat is truely existential, then it would be rational for the Europeans to do everything in their power to mitigate, whether or not you cooperate. If the threat is truely existential, they will be forced into shouldering the higher costs of early-learning-curve action. If they do, you have learned something about the real seriousness of the threat (and avoided early high costs - a bonus!). If they don't, you've learned something else - namely, that their own actions suggest they are in fact misrepresenting their beliefs about the real magnitude of the threat.

Friday, November 19, 2010

Addendum on electoral strategy

Part of what motivated me to do the breakdown of legislators below is that I feel like there's been less strategic thinking by the environmental movement about this sort of thing than I would expect. Possibly I just haven't been exposed to it enough - I didn't come to the climate problem out of interest in environmentalism, but out of interest in international relations and negotiation, and my interest in domestic politics is a secondary effect of the fact that domestic politics constrain international negotiation - but I haven't noticed a lot of it floating around.

By contrast, the other side is certainly doing this, and at an even more fine-grained level. I'm currently reading Eric Pooley's The Climate War: True Believers, Power Brokers, and the Fight to Save the Earth. Pooley describes the strategy of the Information Council on the Environment (ICE - see what they did there?), an organization involved in the anti-climate-action movement:
The ICE's goal, according to a strategy paper written by its pollster, was to 'reposition global warming as a theory (not fact)' by targeting 'older, less-educated males' and 'younger, lower-income women' in congressional districts that get their electricity from coal.
Fundamentally, getting a favorable vote on something controversial is a question of pulling together enough votes, and you do it in the context of a terrain of interests which influence which votes are easiest and hardest to move. Outside actors trying to move votes do best, I think, if they're responsive to the terrain they're working in. But it's not my impression that the environmental movement has gamed this out very much - perhaps because they don't see this as a strategic interaction but rather as a morally driven effort to disseminate the truth. From that point of view, truth is truth whether your district produces a lot of coal or not.

There may indeed be something to be said for that attitude. But I think the environmental movement is at this point losing the information war regarding climate change, and I wonder how much of that is due to facing more strategic approaches from the other side.

Thursday, November 18, 2010

Domestic-level fossil-fuel interests

This began life meant to be a quick-hit post with a simple look at numbers; it ballooned into a post that was too long, and yet not long enough to actually do the subject justice. C'est la vie...

Something I've been trying to do better lately is understanding what the electoral strategy of climate politics looks like in the US. In a general sense, right now, it involves electing people friendly to environmental legislation. But some legislators are inherently more likely to be friendly than others. In theory, all legislators - regardless of party or personal inclination - should find it difficult to vote for climate legislation if they come from states with major stakes in fossil fuels. In particular, coal and oil producing states. So, looking at those:

The key coal states, in order of production as of 2000, are

Wyoming - 339 thousand tons of coal per year
West Virginia - 158 thousand tons of coal per year
Kentucky - 131 thousand tons of coal per year
Pennsylvania - 75 thousand tons of coal per year
Texas - 49 thousand tons of coal per year
Montana - 38 thousand tons of coal per year

After that, you have Illinois, Virginia, North Dakota, and Colorado, all between 29 and 33 thousand tons. For these states, particularly Illinois and Virginia with their larger economies, it's likely that the coal industry isn't decisively important, though it may have an effect.

The key oil states are:
Alaska - 665 thousand barrels per year
(80 percent of Alaska's economy comes from fossil fuels. An Alaskan senator simply can't vote for fossil fuels limitations.)
Texas - 393 thousand barrels per year
California - 240 thousand barrels per year.
Louisiana - 84 thousand barrels.

(Of these, it's pretty clear that in California's policy leanings haven't been too strongly influenced by its oil industry; if I did this analysis more seriously, I'd redo these numbers as percent-of-state-economy, which I'm pretty sure would wash California out, but I couldn't find a quick source for those numbers.)

So for emissions mitigation purposes, let's say you would expect to have a lot of trouble in 8 states: Wyoming, West Virginia, Kentucky, Pennsylvania, Texas, Montana, Alaska, and Louisiana.

But I'm not sure the facts bear this prediction out very strongly.

In the House, we can look at the vote on the Waxman-Markey climate bill. What we see there is that 85% of non-fossil-fuel-state Dems voted yes, while 66% of fossil-fuel-state Dems voted yes (there were only 8 Republican yes votes, none of them from fossil fuel states, so it's hard to say much about Republican votes other than the obvious observation that climate change doesn't align with the Republican platform).

So there's an effect, perhaps, but it's not as strong as I might have predicted. And the 8 fossil-fuel states are a pretty conservative bunch to start with; it's not really clear that the difference is due to anything more than general difference in local ideological center. In Texas, 9 out of 12 Democratic reps voted yes; if anything, that seems an impressive showing for a state as conservative as Texas. One might argue that the 19 fossil-fuel-state reps that voted yes had an effect on the bill, pulling it toward the center and away from stronger measures during negotiation for their votes. In fact, there's certainly some truth to that in an abstract sense, but given that there were 34 non-fossil-fuel-state Democrats who voted no (vs. 10 from fossil fuel states), it seems there were plenty of conservative Dems available to act as potential centrist weights even without the fossil fuel state reps.

The Senate is a little harder. There were eight senators from the fossil fuel states prior to the 2010 elections, and near as I can figure based on a quick pass, they break down like this, in terms of general attitude toward climate legislation (I've listed them in descending order of apparent enthusiasm):

YES or Lean YES:
Baucus (Montana)
Tester (Montana)
Casey (Pennsylvania)

MAYBE
Specter (Pennsylvania)
Begich (Alaska)

NO or Lean NO
Rockefeller (West Virginia) (could possibly be classed as a MAYBE)
Byrd (West Virginia) (could possibly be classed as a MAYBE)
Landrieu (Louisiana)

Only Landrieu is a really clear no; she voted against cloture on Lieberman-Warner. Byrd and Specter didn't vote. Begich wasn't in office yet. Baucus, Tester, Casey, and Rockefeller voted for cloture, but Rockefeller later signed a letter stating that he'd voted for cloture, supported climate action in general, but couldn't support final passage of Lieberman-Warner specifically. 10 senators signed this letter; of the 10, only Rockefeller was from a fossil-fuel state.

What this suggests to me is that within the fossil fuel group, there are 2-3 yes votes on climate legislation; 2-3 maybes that could be convinced under the right circumstances; and 2-3 no votes.

I frankly expected to see stronger effects on environmental voting. Initial thoughts on why not? Well, one could argue that Montana shouldn't be in the group; its coal production is the smallest of the group, though that's in the context of a small total state economy. If we remove Baucus and Tester from the Senate group, we remove the two strongest fossil fuel yes votes, and the effect looks stronger on the Senate side. On the House side, the solution is likely to look at the specific districts involved and see which, if any, are really involved in the fossil fuel industries in their states; most are in Pennsylvania and Texas, larger economies with many other contributing industries, and many of the Democrats are likely from urban areas that may not depend in obvious ways on fossil fuel production. In other words, the answer may simply be that the Democrats already have very few real holdings in fossil fuel producing areas, period.

Anyway. Next steps, when I get around to it: get fossil fuel numbers as a percentage of state economy and see how that affects the picture; look at individual House districts.

Wednesday, November 17, 2010

Energy subsidies

In the category of stuff you already knew, I love this chart on levels of subsidies for clean energy, corn ethanol, carbon capture, and fossil fuels:

Environmental Law Institute (www.eli.org/Program_Areas/innovation_governance_energy.cfm)

The take-away message: the US government is not simply doing less than it should be to support renewable energy. The US government is actively spending to support fossil fuels  relative to renewable energy ($70.2 billion vs. $12.2 billion). In fact, it’s spending to subsidize foreign fossil fuel production alone, relative to renewable energy: the Foreign Tax Credit (at $15.3 billion), is in and of itself larger than the amount spent on renewable energy.

Tuesday, November 16, 2010

How fast is China moving?

"China hits rocky road over diesel demand" doesn't sound like the most interesting thing you might read today, but I think it might be something I've been looking for for a while. Key quote: "The Chinese government is rationing electricity supply as it rushes to meet ambitious energy and environmental targets by the year's end, hence boosting demand for diesel, power generators, and even candles as the country scrambles for extra power."

There's been something of a narrative for a while that the Chinese, although unwilling to sign anything on the international treaty front, are nonetheless actually moving just about as fast as they can to curtail energy use. This is, I think, the story China itself would tell; and there's certainly a lot going on in China. But one also wants to be careful not to be diplomatically naive. It's in China's best interest to tell that story, but is it true? Could China move faster if it had incentives to do so? How would you tell the difference?

This is one possibility. If the Chinese government is pushing efficiency requirements so hard that companies are actually going off-grid and buying up diesel in quantities big enough to cause local diesel shortages and warrant international notice, it seems unlikely that there are a lot of easily accessed, unexecuted alternative efficiency measures available to them, at least in the short term.

In this case, it looks like it may be a temporary effect caused by a strong push to meet some targets - so it's not clear whether this is unavoidable crunch or just a failure to manage well over the long term resulting in a short term crisis. And you'd also want to look at whether companies had in fact made use of available efficiency measures before turning to local generation (if they hadn't, it would suggest there was just something broken about the process.) But in a general sense, spillover into costly stop-gap measures like this seems like the kind of evidence you might look for to assess whether reform was approaching its maximum rate or not.