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Part 3: What Does It Take to Realize the 1.5 Degree Scenario
David B. Goldstein

"It always seems impossible until it's done."

Nelson Mandela

This blog series is an effort to present some preliminary thoughts on how the U.S. and other nations could limit the increase in global average temperature to 1.5 C. My goal is to spark a conversation on this critical issue.

Recap

Parts 1 and 2 discussed what a 1.5 degree scenario would look like. Part 1 summarized why a 2 degree scenario would rely most heavily on energy efficiency programs that accelerate economic development. Part 2 looked at five additional areas not usually included in the studies that show how we get to 2 degrees and discussed how they make the 1.5 degree scenario practical and plausible, and one that will further contribute to economic growth.

What does it take?

The first and most important thing it takes is motivation. If the nation and the world realized, first, the enormity of the threat of climate change, and second, the fact that averting it is possible and even attractive economically, then we could adopt and refine the policies needed to get there.

Stopping climate change at 1.5 degrees requires the self-confidence needed to strive and then reach a goal even if the exact steps to get there after the first few years cannot be spelled out.

More specifically, it takes the type of programs outlined here, along with a scaling up of policies that advanced states and regions are already undertaking. In other words, no sacrificing, no burdensome regulations or limits, no rationing or large energy price increases—virtually nothing that makes day-to-day life more challenging. Instead it takes political support for ambitious expansions of existing programs, along with the funding to allow them to realize their fullest potentials.

But this funding need is offset by eliminating the need to invest trillions of dollars—most likely dozens if trillions of dollars—in old-fashioned energy and energy service infrastructure: oil and gas well, powerplants, gas pipelines, freeway expansions, parking lots, cars that sit idle 95% of the hours in a year, etc. The sooner we stop investing in conventional assets that will become obsolete before their useful life is over, the less assets we risk stranding in soon-to-be-obsolete infrastructure.

There are plenty of examples of people or organizations setting ambitious goals whose means of achievement were beyond the ability of anyone to predict. Occasionally this happens without even trying, such as the creation of mass markets in portable internet-connected computers that work even in remote villages, but other times it comes about because leadership asks its staff for the impossible and they deliver: the Toyota Prius.

Some may argue that such ambitious proposals are unrealistic. But this is a circular argument: if the public and their representatives believed that meeting climate goals is important, then they would certainly enact the needed policies. The problem is that these policies have seldom been laid out before the American public, alongside a quick demonstration that they are indeed technically and economically feasible. That is the motivation of this essay.

The practice of setting performance goals is fundamental to how American business has worked for generations: while we talk in theory about companies maximizing profits, the WAY they do it typically is by setting goals—sales increases, cost reductions, production levels, etc. Adding a climate goal to the mix, especially if it can be company-specific and integrated into management procedures such as is done in Strategic Energy Management (SEM), can itself be a key part of the solution.

Perhaps the strongest example of this in American history is World War II. The bombing of Pearl Harbor came at a time when we were utterly unprepared to fight a war. Yet starting the very next morning, the President committed the nation to fighting and winning the war. This fight disrupted the lives of millions, and involved the government essentially taking over large industries such as automobile production, and rationing civilian use of gasoline. Limiting climate change will be nowhere near as disruptive, thus the fact that we could prepare for the war and launch a major invasion across the ocean in just 2 ½ years shows that we can change our economy quickly when we realize the importance of doing so.

A global perspective

Much of the world is still mired in poverty. What about the argument that their emissions must grow in order to provide a middle class lifestyle to citizens that are now poor?

This argument is based on the false assumption that energy use must grow in proportion to income. If richer countries are going to reduce emissions, meaning even greater reductions in per-capita emissions, then the level of energy that an aspiring middle class African must reach is much lower. Already we are seeing high-end buildings being built with essentially no extra costs that consume zero energy on net. If we can do this for wealthy office workers in Seattle, and wealthy homeowners in Austria, we assuredly can do it for formerly poor families in Africa or India or China.

When we look at industrial energy in other countries, we need to recall that industrial energy is consumed to produce products that serve mainly consumer needs, such as housing, shopping, schools, etc. In fast-urbanizing China, over 20% of industrial energy goes to provide building materials to the home and commercial buildings sector. As China’s population stabilizes, the need for new construction will drop dramatically. This will also occur everywhere that population stabilizes: a key component of emissions will be to produce stuff that is no longer needed in anything like the temporary quantities needed to house the urbanizing population. And in countries that are still urbanizing, we can find ways to reduce the energy and emissions impacts of construction.

And the process can be enhanced by making choices to reduce supply chain energy as part of the SEM efforts (which are global: the U.S. is not the farthest along in implementing the International Standards for SEM). Developing countries can reduce emissions by using cleaner fuels, more efficient (and thus more productive and competitive) industrial processes and operating protocols, and by making design choices that rely on less emissions-intensive materials.

We also need to note the globalization of business and its consequences on other countries if the United States meets an advanced emissions reduction goal. Most energy-using products are sold into global markets: air conditioners, motors, pumps, fans, light bulbs, TVs, etc. Efficiency in one country tends to spread everywhere, just to reduce the difficulty of making different products for different regions. Many buildings in any given country are owned by real estate firms with properties around the world—good experiences with deep retrofits or zero net energy buildings in one country will spread to other places even without policy.

One of the biggest problems faced by many developing countries is weak rule of law: the government may try to require efficient products and clean energy sources, but is too weak to assure that they are implemented. Some of this may be overcome as global markets harmonize on more efficient and cleaner products. Many countries have civil society organizations that work to strengthen rule of law, or to implement standards and policies in collaboration with government, and the climate imperative may add to their success, especially as less-developed country stakeholder recognize that their countries suffer disproportionately from climate change.

Closing Observations

Suppose we learned tomorrow that there were previously unsuspected dire consequences of warming beyond 1.5 degrees.  We would solve the problem because there was no choice, by whatever lawful means necessary, even if the measures were draconian. Fortunately, the geophysics may not be that dire. If we have more time, we can encourage the moderate form of these measures through the use of mostly carrots rather than sticks, and save almost as much emissions a little slower but a lot cheaper and with increases in economic freedom.

Can we really limit climate change to 1.5 degrees? The real answer to this question has three parts:

  1. If we DON’T set a goal this ambitious, we surely WON’T meet it. We won’t meet it in part because we won’t have allocated the budgets needed to meet it.
  2. If we DO set the goal, we just might meet it. It is technically possible. At worst, we may find that some of the final pieces are too expensive, or will not be done for political reasons, so we delay them. Or we might find alternative emission savings that we didn’t plan for.
  3. If we don’t meet the goal, we will come far closer than we would have had we not set the goal.

Let’s make climate change a focus of renewed patriotic commitments. There is no economic or other sacrifice involved. Instead, we will be helping our children and grandchildren to live in a more secure, prosperous, and fair world.

Part 2: Stopping at 1.5 Degrees: What Will It Take?
David B. Goldstein

This blog series is an effort to present some preliminary thoughts on how the U.S. and other nations could limit the increase in global average temperature to 1.5 C.  My goal is to spark a conversation on this critical issue.

Part 2 of a 3 part blog: Stopping climate change at 1.5 degrees: what will it take?

In Part 1, I discussed what it would take to stop climate change at 2 degrees, both in terms of technologies and in terms of policies. I noted that the most important overarching strategy, both in the U.S. and globally  would be energy efficiency, where policies will cut energy bills and prices, create millions of new jobs, and help overcome the economic downdrafts that led to the recession of 2007-9, from which half of Americans have never really recovered.

Renewable energy also plays a dominant role.

This blog continues the thought exercise of what additional strategies, both on energy efficiency and on limiting other greenhouse gas emissions, are needed to meet the 1.5 degree stretch goal set at the Paris conference, if the U.S. adopts that goal.

As noted in Part 1, the Paris Agreement re-iterates the goal in previous UNFCCC climate accords of holding the increase in average global temperature to below 2 degrees C, and also includes a new goal of pursuing efforts to limit temperature increase to 1.5 degrees

Although it would require more detailed analysis to identify the exact pathway to limit warming to 1.5 degrees, we can start by looking at the most challenging problems with the 2-degree scenario and identify how we would solve them. This simplified approach may be more valuable than the detailed analysis, since the energy modeling for such an ambitious scenario depends on assumptions that are not analytic, but rather are based on judgments as to what is politically feasible and how fast decisions can be made and implemented at scale. These are not things that can be modeled or forecast: they are tough decisions that we will have to make.

The ideas explored next are discussed in a way that will allow an analyst to design quantitative scenarios; however this essay does not undertake to do so, in part because a specific roadmap of what technologies need to be deployed in what areas is not necessary. If the policies are designed in a manner flexible enough, they will allow markets to get us there more cheaply and easily, using a different mix of technologies.  

This essay will map out the path to 1.5 degrees by starting with some major opportunities that were ignored or downplayed in essentially all of the 2-degree scenarios. Of course, the first course of action is to simply accelerate the deployment of the 2 degree scenario technologies, such as efficient appliances and vehicles, buildings that use so little energy that it can be generated on-site with solar panels, wind and solar energy, and electric vehicles.

These policies will cause economic gain, not pain, for most people and businesses, who will not notice the difference except to the extent that they have new and profitable business opportunities and  reduced household expenditures.

Sooner rather than later

In addition, a more stringent emissions target means that we need to look more closely at timing. These issues have not generally been addressed in 2 degree scenarios either because of a perceived need to be “conservative” (the word is in quotes here because allowing the climate to warm by as much as 2 degrees is a fundamentally risky, or non-conservative, goal) or simply by ignoring some of the opportunities due to a lack of research budget or effort by the report writers or due to gaps in the published literature.

Climate pollution is cumulative: it doesn’t matter much how many tons of carbon equivalent we emit by 2050 but rather how much we have emitted during the whole of the next 33 years.  An approach to 80 percent reduction along a straight line path will lead to more cumulative emissions than front-loading the savings. So a key to stopping at 1.5 degrees rather than 2 is acting fast, since delaying action will be more costly both in terms of cumulative emissions and in terms of money.

What about that last 20 percent?

For the 2-degree case, the goal for the U.S. is to reduce CO2 emissions by 80 percent by 2050, as discussed above. What accounted, then, for the remaining 20 percent? The key problems were natural gas use in industry, and petroleum use in road and air transportation; there were also issues with reducing the emissions of non-carbon greenhouse gases.

Going below the 2-degree case will also require an expanded effort on the sequestration of carbon in natural systems. Reduced emissions and increased sequestration of emissions from soils and forests can significantly offset remaining emissions from combustion of fossil fuels. So these areas are the ones on which we focus.

Although 1.5 degrees is much more of a challenge for energy planners than 2 degrees, it is still very much doable.  But meeting it will require a lot more ambitious policies, including those discussed next.

Since climate pollution is cumulative, and we are already slightly beyond 1 degree, stopping at 1.5 degrees means reducing cumulative global emissions by about half compared to 2 degrees. (Because if you want temperature increase to be only ½ of a degree below today’s level, that is half the emissions of a 1-degree rise.)

This reduction has not been allocated across countries, but one way to do it would be to start with national plans to stop warming at 2 degrees and then cut the cumulative emissions by half. This is what this essay does for the United States in the next section.

A key difference between the 1.5 degree scenario and the 2 degree scenario is that efficiency is even more important to limit warming to 1.5. Efficiency can be deployed faster than any other zero-emissions technology. In the 1.5 degree scenario, front-loading our efficiency and automobile travel reduction policies is critical because the electricity and gasoline we avoid is dirtier than they will be in the future when more renewables are developed and when fuel economy of cars is higher, judging from the predictions of the 2 degree scenarios.

Additional Opportunities: 5 New Programs

These programs focus on areas where the least analysis has been done, meaning that many opportunities for savings were left unanalyzed and off the table, and where the emissions over the next 35 years are high. We focus also on actions that can be taken promptly. The discussion will show how these new initiatives complement the policies already needed to get to 2 degrees, as well as complementing each other.

Of course, we should also deploy efficiency faster and more deeply than we do in the 2 degree scenarios, and expand and accelerate the use of wind and solar and their associated demand response infrastructure to better integrate intermittent renewable resources into a grid where more and more of energy usage can be schedule to match the availability of renewable energy.

This essay suggests five areas where policies could be developed or strengthened where the potential savings are understated in current 2 degree scenarios. If we spent more time to look, we will find that there are far more opportunities than this in real life.

1. Fast, Deep Retrofits of Buildings

Buildings account for more than 35 percent of climate pollution in the U.S. It is possible to cut energy consumption in buildings by typically 50 percent for commercial space and 40-50 percent for residential using moderate cost measures that pay for themselves even without considering environmental and health benefits. Further savings—to the point of achieving net zero energy consumption—are technically feasible and financially reasonable in many cases.

We already know how to incentivize virtually all homes to undertake these deep retrofits, and to do it in just 4 years (a year for planning and 3 years for implementation), because we have already done them as pilot projects. These pilot programs were operated on the scale of a small community, so it requires more logistical efforts to scale them up to a national level. However, the scale-up does not have to occur overnight. It should not take more than a few years to construct new insulation and window factories, to upgrade the efficiency of manufactured climate control equipment, etc., so that only the most efficient of the current product line are produced in numbers, and to train workers who used to build new homes ten years ago to retrofit existing ones next year.

These successful retrofit experiments involved very high levels of financial incentive, but there are reasons to expect that the incentives could be reduced drastically over time.

This essay therefore proposes to retrofit all existing buildings by 2030, using market-based approaches that reward higher percentage savings more generously, and that set minimum required levels of savings (say, 25-30 percent). The reason to choose a goal of 2030 is that we want to create sustainable jobs for the contractors performing the work and the suppliers of efficiency products and solar energy. If we remodeled all buildings in 5 years, we would create a boom and bust cycle. But if we take 15 years, and have a market-enhancing structure, the level of savings will increase over time and we will have the opportunity to return to the first buildings after 2030 to participate and find additional savings.

Raising the capital for this program would not be difficult, as one of the policies that would be required—reforming lending to account for the cash-flow savings from energy (and location) efficiency—would allow them to be financed through conventional mortgages, and the scale of the increase would be roughly equivalent to restoring the new-homes market to where it was before the crash.

No other technical study, to our knowledge, has proposed such a fast or deep program. Many other analyses of this topic project only 15 percent savings by 2030—only about a third of what is being proposed here.This roughly tripling of energy savings compared to other studies produces a disproportionately large reduction in emissions, since the electric grid is a lot dirtier from now till 2030 than it is projected to be from 2030 to 2050. And if we are trying to limit concentrations of greenhouse gases, which are cumulative, fast reductions are especially important because we assure that the worst performing buildings will not continue their high level of emissions for more than 15 years.

This essay’s proposal has strong non-energy benefits: the worst-performing sector of the economy over the past decade has been housing. Lots of jobs have been lost as the number of new homes constructed struggles to reach HALF the level that it was at before the bubble and crash of 2003-9. So we have the skill set in the labor force to do the work, and the economy would benefit from deploying it. The result would be about 300,000 net new jobs, disproportionately skilled blue collar jobs, which occur where people already live.

We can also find additional savings from better operations and maintenance, and other behavioral programs, especially for commercial buildings. Immediate savings of from 15 to 30 percent above and beyond those from physical upgrades are easily and cheaply achievable.

2. Smart Growth and Shared Mobility

Smart growth refers to the design of neighborhoods and transportation systems such that less driving is required. Smart growth neighborhoods can allow families to get where they want to go with only 1 car, or with none, rather than owning 2 or three, so they save lots of money—around $10,000 per year.

Constructing new neighborhoods takes time, but adding infill development to existing neighborhoods is faster, and improving transportation infrastructure is still faster. New bus lines, pedestrian paths, bike lanes, etc., take only a few years. And one of the fastest opportunities, shared mobility, can be implemented almost immediately. (And it is beginning to happen just from market forces. What policies do we need to enhance it and how much could it save? Would we want to require Uber, etc., to offer carpool travel to all users, for example, or to make it the default choice on their app’s?)

Smart growth and shared mobility can also reduce emissions that would otherwise occur as we decline to build new roads, parking spaces, etc., which would be avoided by smart growth. Parking infrastructure reductions alone (there are currently some 4-8 parking spaces in America for each car) would save as much emissions as taking 10% of cars off the road. These savings would show up as industrial energy use reductions, which are a major issue for emissions limits.

The issue with climate studies is first, that most of them ignore smart growth and focus exclusively on better vehicles and cleaner fuels. And the few that do consider smart growth make timid assumptions about how quickly and deeply urban designs can change. But market trends now favor smart growth even as lending policy (“drive till you qualify”) and zoning laws still encourage sprawl and require parking to be provided and generally offered for free. With plausible policies, similar to those already adopted with bipartisan support in California, it is reasonable to foresee a scenario in which essentially all new housing, on net, is built in smart growth circumstances, either by adding density to older neighborhoods or developing new ones

This essay does not attempt to estimate how much farther we can go in travel demand reduction than previous studies for many reasons, including the unreliability of the models used to project “business as usual” and the problematic question of defining what “as usual” means. And quantifying it would not be useful on a national level in any event, since policy actions take place primarily at the local and metropolitan levels, where in some cases planners strive to meet quantitative targets on automobile vehicle miles traveled or on carbon emissions. But the additional savings resource is substantial.

These recommendations sound bolder and thus less realistic than they are, primarily because the efficiency literature did not address location efficiency until very recently—in the past, policies that led to less driving were considered to be conservation behaviors rather than efficiency. But now we see that the primary trends we need to limit climate pollution are already happening EVEN IN THE FACE OF CONTRARY POLICIES. People in the Millennial generation are increasingly choosing to live in walkable neighborhoods and are driving less than their parents did, even when policies still encourage car dependence. They are making these choices in cities that previously did not even offer such choices. Shared mobility is booming even where the companies providing it are restricted by regulation from expanding as much as they would like.

Typical 2 degree studies also fail to account for potential reductions in intercity automobile and air travel by modal shifts, and this also represents a reservoir of additional savings.

3. Strategic Energy Management in Industry

Virtually all studies of industrial savings potential start at the level of widgets (better boilers, variable speed motors, etc.,) and work up. They fail to account for major changes in process, or for incremental improvements in O&M procedures. Strategic Energy Management (SEM) is a standard for organizational management that promotes continual improvement in both facilities and O&M and directs management to provide sufficient resources to staff to save ever more energy.

Since there is not wide experience with this concept, it has not found its way into climate emissions mitigation studies. But the limited cases where it has been used, manufacturers achieved large savings in the initial years, and one company reports 4.5-6% annual gains for 10-30 years. And these savings were achieved without:

  • Looking at fundamental process changes (because of a lack up budget for such actions—something that would need  to change under an SEM scenario),
  • Considering savings in the supply chain, and
  • Counting renewable energy production. (Several major companies have begun to purchase renewable energy sources to cover 100% of their energy loads.)

To reduce industrial emissions proportionally to those expected in other sectors would require a rate of improvement of almost 7% annually—a challenging goal. But when even the leading companies refuse to invest in improvements that pay back their costs in three years, there is a lot of profitable slack in the system that could be addressed by policy, including utility programs for SEM, changes in financial rating criteria to allow companies to borrow and invest in profitable efficiency upgrades, and just the process of setting goals and tracking progress. That is why the typical large company engaging in SEM finds that the improvements (that they had not undertaken before) pay back in 1 ½ years.

So far, the extent of incentivized SEM programs has been minimal: generally small-budget programs in only a few regions. Worse yet, without financial incentives, SEM participation has not been sustained. Thus incentive programs are needed for the existing efforts to be rapidly expanded and to target more ambitious goals. Financing the improvements should not be a problem, since they are all very cost effective. It may be helpful to change lending or financial rating methods analogously to what is recommended for the buildings sector.

Saving Emissions in the Supply Chain

Most of industrial emissions are caused by a very small number of industrial categories, such as steel, chemicals, cement, etc. No systematic analysis has yet been undertaken of where all of these energy intensive products are used, and whether there are alternatives. Yet a growing number of businesses are starting to track the upstream emissions consequences of their activities, and in the process discovering savings opportunities that no one knew were there.

As more companies undertake SEM and look at the supply chain, new emissions savings opportunities will emerge in areas that no one anticipated. For example, NRDC has shown that 40% of food is wasted. Food supply and preparation account for some 25% of climate pollution. If we could cut food waste in half, we could save an additional 5% of emissions. NRDC also estimated that reduced parking needs—reducing the need to construct new parking spaces—could cut emissions by some 100 million metric tons of CO2 annually—about 10% of the residual emissions for 2050 in the 2 degree scenario. This potential is also entirely absent from any climate studies we have seen.

A policy option to promote SEM would be to encourage businesses to set goals for continual improvement in energy performance, counting both efficiency and non-emitting energy supply, and to make their metrics and their results publicly available.

Many large companies already publish annual sustainability reports, and this dataset could be the central component of their analytics. Also, SEM is not only applicable to industry. It can be used by building operators, even single families, where it will promote not only physical retrofits but emissions-reducing behaviors.

4. Forestry

Most analyses of emission reduction potential focus on opportunities to reduce emissions from combustion of fossil fuels. Expanding that focus to include forestry provides additional opportunities. The past few decades have seen a significant loss of forests, primarily in the tropics. As these forests are cleared, the stored carbon in the trees and forest soil is released into the atmosphere. The emissions from this deforestation accounts for approximately one quarter of the total climate forcing over that period.

Reducing the rate of deforestation will lower emissions and contribute to meeting a 1.5 degree target. Additionally, restoring forests, planting new forests, and increasing forest growth—or reforestation, afforestation, and improved forest management—provides one of the few opportunities to sequester carbon that has already been released and lower CO2 concentrations in the atmosphere.  CO2 concentrations are also lowered by the absorption into the oceans, but this results in acidification with increasingly dangerous implications for ocean ecosystems.

Forests are cut down for a variety of reasons, including the need for forest products such as paper, wood, and fuel and in order to make land available for other purposes such as agriculture and development. Clearing of forests results in emissions from the release of the stored carbon in the trees. But more often the emissions occur rapidly through losses in conversion into wood products, direct combustion of wood for fuel, or decomposition of short-lived wood products such as paper and packaging. Forest soils often also contain significant amounts of carbon which can be lost to the atmosphere when forests are cleared.  In the case of peat soils, the amount of soil carbon can exceed the amount of carbon in aboveground biomass.

Strategies to reduce forest emissions and increase sequestration need to include measures that protect forests and instead focus development on already-cleared lands as well as efforts to reduce the demand for forest products through increased efficiency and use of recycled products.

Forest protection is necessary to reduce the huge emissions that occur when existing forests are cleared. Protection of existing forests is also critical to protect the many co-benefits that these forests provide, including species habit, forest products for local communities, and soil carbon. Once an old-growth forest is cleared, it can take decades to centuries to restore the full range of benefits that the forest provides.

Reduced demand for forest products is also essential. If demand continues to grow, then the pressure for forest clearing will overwhelm site-specific efforts to prevent clearing.  (The problem of reduced emissions in one place being replaced by emissions elsewhere is known as “leakage.”) Demand for forest products can be reduced through a variety of strategies including improved efficiency and increased use of recycled products. For example, we can reduce the need for virgin paper by double-sided printing and by increasing the use of recycled paper.

Finally, planting new trees and allowing trees to grow longer before harvest offer a significant opportunity to increase the amount of carbon dioxide that is removed from the atmosphere. Over the past few decades, terrestrial ecosystems have sequestered large amounts of CO2, largely offsetting emissions from land-use change. Afforestation on degraded and/or deforested lands can supplement this important carbon sink.

It typically takes decades before newly planted forests sequester carbon at high rates, so early action to plant trees now is essential to provide benefits in the middle years of this century. Afforestation can also provide many co-benefits including water retention, flood protection, and ecosystem benefits which help to justify a significantly increased level of investment. Urban forestry offers a particularly large array of co-benefits in addition to the direct benefit of carbon sequestration, including improved air quality, reduced summer temperatures (which reduces need for air conditioning), and improved property values.

Significant progress has already been made in reducing emissions from deforestation. The FAO estimates that global emissions from deforestation have decreased by 25% from 2001-2015. But multiple analyses find that reduced deforestation, improved forest management, and afforestation offer further large cost-effective options for emissions reductions. One study estimates the potential for emission reductions from reduced deforestation of up to 2.7 GtC/year. Increased afforestation and improved forest management could add significantly to this total.

5. Reducing Methane Leaks

There are two types of policies that can reduce methane leaks, which currently account for about 15 percent of U.S. greenhouse gas emissions, on a weighted basis.

The first is to swiftly and significantly reduce methane emissions from all sectors of the natural gas and petroleum industries, from production through distribution. According to the EPA's most recent Inventory of U.S. Greenhouse Gas Emissions, the oil and gas industry emits nearly 30 percent of total U.S. methane emissions, making it the largest industrial source of methane emissions in the nation. Pound for pound, methane can cause over 80 times more warming than carbon dioxide, so reducing emissions of this short-lived but powerful greenhouse gas is crucial to fighting climate change.

Given that methane is the primary component of natural gas, controlling emissions also makes economic sense for industry because methane that is not leaked is methane that can be sold. Additionally, technologies for reducing methane emissions are readily available and low cost. Despite these facts, the oil and gas industry has made only very modest progress on reducing methane emissions voluntarily, due at least in part to the fact that projects to reduce emissions may yield a lower rate of return than, for example, drilling new wells and therefore have a hard time competing for capital. Federal and state policies to reduce emissions are therefore crucial.

Leading states such as Colorado and Wyoming have strong and sensible rules to control methane across the oil and gas supply chain. At the federal level, in 2016 EPA put in place important rules that will apply to new sources of methane emissions and has begun the process of planning to regulate existing sources. Oil and gas equipment and facilities already in operation will be responsible for the vast majority of future methane emissions—one study found that by 2018 almost 90 percent of methane emissions from the oil and gas sector will come from sources that were already in operation in 2011. In order to meet climate goals, it is therefore critical that comprehensive policies be developed and implemented to control emissions from existing sources. The U.S., Canada and Mexico recently committed to reduce methane emissions from their oil and gas sectors by 40-45 percent below 2012 levels by 2025, and explore new opportunities for additional methane reductions. These goals will only be reached if the countries move swiftly to control existing sources of methane pollution.

The second set of policies for reducing methane emissions is to look for places where the existing gas distribution system is aging and leaky to the extent that expensive replacement is needed, and to shut these systems down and electrify the buildings that are currently served. Electrification in many cases will be cheaper than replacing the gas pipes, and will not only eliminate the methane leaks permanently but also reduce emissions because electrification of low temperature heating is already a part of the two-degree scenarios. These opportunities can be pursued immediately. Other more expensive replacements of electricity for gas should be done later, and planned in advance to minimize economic losses.

The reason it makes sense is that while 20 years ago, the most efficient way to provide space heating and water heating was to burn gas at the building site, today electric generators and heat pumps are more efficient than they used to be, such that a unit of gas burned at a power plant produces more heat than it would have if burned at the building. Not only that, but the sources of electricity are rapidly becoming more heavily tilted to wind and solar, and accelerating this trend is part of the low-emissions scenarios. California, the nation’s most populous state, and New York, with the third largest population, have already committed to 50 percent renewables by 2030; Hawaii and Vermont have set even higher renewables goals.

Summary of New Programs for Dramatic Emissions Reductions

This essay has suggested five new programs that go beyond most of the savings in greenhouse gas emissions that have been included in studies focused on meeting the 2 degree goal. While there are good reasons to limit a short essay to only five new ideas, in the real world of policy there are dozens of other policies and plans that can further reduce emissions beyond those that have been analyzed anywhere. Some of them are new policy approaches, while others involve trying to quantify emissions savings that will occur from programs whose impacts are indirect or which have never been studied quantitatively.


End Note

My thanks to Peter Miller and Briana Mordick of NRDC for taking the lead in writing the sections on forestry and reducing methane leaks, respectively.

China Focuses on Robust Enforcement of Clean Marine Fuels
Barbara Finamore

Freda Fung, 2016

October 1st is China’s National Day, but this year it also marked an important day for controlling shipping pollution: Shenzhen, the world’s third biggest container port, started early enforcement of China’s national Domestic Emission Control Area (DECA) regulations. That is, Shenzhen has joined five other Chinese clean ports - Shanghai, Ningbo-Zhoushan, Suzhou, Nangtong, and Hong Kong - to mandate ships use fuels with no more than 0.5% sulfur content while at berth. Shenzhen, Shanghai, Hong Kong, and Ningbo-Zhoushan ports are among the world’s busiest, and together they handled over 100 million twenty-foot equivalent unit (TEU) containers in 2014, which is similar to the annual container volume of all EU ports combined and twice as much as all U.S. ports. The thousands of ships calling at these Chinese ports every day must now use fuels with 80% less sulfur. Beginning on January 1, 2017, the DECA regulations will go into effect for all of China’s eleven core ports.

China is not just targeting its clean air efforts on Ocean-Going Vessels (OGVs); it also started regulating air pollution from domestic vessels (inland and Chinese-flag fishing and coastal vessels). In late August, China adopted its first-ever regulatory standards for controlling air emissions from engines used on domestic vessels. With over 160,000 inland vessels in operation, China has the world’s largest inland vessel fleet, but air emissions from these vessels have been essentially uncontrolled due to a lack of regulation. The adopted engine emission standards will, for the first time, drive the adoption of engine technologies that can better control emissions from domestic ships.

A recent study found that oceangoing ships alone causes nearly 18,000 premature deaths per year in mainland China, and this estimate does not include the health impacts of air pollution from inland and coastal shipping. So China’s national DECA regulations, the accelerated adoption of DECA at the local level, and regulations to clean up its domestic vessel fleet, are important steps for mitigating the health impacts of shipping on its citizens. 

China Inspiring Other Asian Countries to Act

Zhixi Zhu, 2016

China’s actions have also inspired other Asian countries to act. During a session on “Managing Air Quality in Port Cities” jointly organized by NRDC, Clean Air Asia, and the United Nations Environment Programme (UNEP) at the 2016 Better Air Quality (BAQ) Conference held in Busan, South Korea, a representative from the Port of Busan noted that the Korean government is seriously looking into setting up an emission control area for ships, similar to China’s DECA. In addition, a number of port cities, including Busan, Kaohsiung, and Hong Kong, are making efforts to clean up port-related air pollution by electrifying cranes, converting diesel-fueled yard trucks to natural gas, offering onshore power supply, providing incentives to promote green shipping, and experimenting with the use of solar energy for powering port facilities, among other exciting initiatives. UNEP has also sponsored the completion of emission inventories at Tanjung Priok Port in Jakarta, Indonesia that will help officials choose the emission control measures that best suit the port’s situation.

Innovative Enforcement Approaches in Europe

To both ensure that the promised benefits of DECA will materialize and maintain a level playing field, China is working hard to enhance its DECA enforcement capacity. In early September, two researchers from the Waterborne Transport Research Institute of the Ministry of Transportation (MOT) of China participated in a study tour in Denmark and the Netherlands that was organized by NRDC in cooperation with the Royal Danish Embassy in Beijing. During the five-day tour, the researchers met with officials from the Danish Maritime Authority, Danish Environmental Protection Agency, and Netherlands Shipping Inspectorate, as well as leading researchers who are developing remote measurement tools, to learn how advanced technologies, such as remote measurement and instantaneous fuel sulfur analyzers, are being used to monitor ship emissions and screen fuel sulfur content, which help effectively and efficiently enforce EU’s SOx Emission Control Area (SECA) regulation.

The researchers also visited two manufacturers that produce marine engine and emission control devices for the marine sector in Denmark, spent a full day with officials from the Port of Rotterdam Authority, and met with the Green Award program (which audits and certifies vessels to stimulate safe and green shipping) to better understand the latest development of management systems and technologies for reducing air pollution in goods movement systems (ships, port equipment, locomotives, and trucks), as well as various incentive programs for promoting safe, green, and efficient goods movement systems.

Cheng Huihui, 2016

Since the Yangtze River Delta started implementing the DECA regulations in April, the Maritime Safety Administration (MSA) of Shanghai, Jiangsu, and Zhejiang have already caught dozens of ships not complying with the DECA regulations (also see here, here, and here) through onboard inspections of documents and testing of fuel samples. However, the large number of ships calling at China’s ports- for instance, over 68,000 OGVs call at the Port of Shanghai every year versus 28,000 OGVs at the Ports of Rotterdam, Europe’s largest port - requires a more efficient way to target enforcement efforts on ships that have higher potential for non-compliance.

Jasper van Vliet, 2016

The National MSA of the MOT, which oversees and guides DECA enforcement for all ports in mainland China, is currently evaluating other methods to improve the enforcement of existing DECAs. The two researchers participating in the study tour mentioned above are providing technical support to MSA’s enforcement program, so the study tour offered timely opportunities to learn about international best practices that could be quickly adopted and tailored to best suit China’s needs and helped establish a channel for future communications and exchange among officials and relevant stakeholders in China and the EU.

Strengthening the Global Marine Fuel Sulfur Cap

On the global front, to combat shipping pollution, the International Maritime Organization’s Marine Environment Protection Committee (IMO MEPC) will decide later this month whether to implement a stricter global marine fuel sulfur cap of 0.5% in 2020, or to delay implementation to 2025. Some players in the industry have raised concerns that implementing the stricter global cap in 2020 may result in an initially weak enforcement regime, as many nations seem not yet ready. The industry is also concerned that refineries do not have enough time to adjust to production and deliver sufficient amount of low sulfur fuel if the stricter cap is implemented in 2020. However, a five-year delay would have significant public health consequences, causing an additional 200,000 premature deaths from lung cancer and heart diseases, according to an unpublished IMO-commissioned study. China would be among the countries hardest hit by such delay.

China’s current efforts to develop a robust DECA enforcement program would prepare the country well for enforcing the global cap. Its experiences in establishing a strong enforcement capacity would also be valuable for other countries that have not yet regulated shipping pollution.

Aside from the previously mentioned BAQ conference and European study tours that we organized, NRDC has also provided a series of fuel regulation enforcement training workshops. In order to support timely implementation of the 0.5% sulfur cap in 2020, we are ready to assist port cities all over the world in sharing best practices.

This post was co-authored with my colleagues Freda Fung and Zhixi Zhu.

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The Paris Agreement and China’s Climate Leadership
Barbara Finamore

In the midst of its weeklong National Day holiday – also known as Golden Week – China has another reason to celebrate today.  Seventy-two countries, accounting for nearly 57% of global GHG emissions, have now formally joined the Paris climate agreement, meaning it will enter into force in 30 days. As my colleague Jake Schmidt writes, this marks “a global turning point in meeting the central environmental challenge of our time.”

China played a key role in getting the Paris Agreement over the finish line. The series of bilateral climate agreements between China and the U.S. – the world’s two largest GHG emitters – set the stage for the Paris negotiations, and also contributed to the extraordinary speed with which the agreement will enter into force.  In addition, China and the U.S. are working together to push for an ambitious global phase-down of the potent heat-trapping chemicals called hydrofluorocarbons (HFCs) under the Montreal Protocol. China is also playing an active role in negotiations on an agreement to work towards “carbon neutral growth” in aviation emissions post-2020.

Some members of the U.S. Congress continue to claim that China will not follow through on its Paris climate pledges, which include the following four goals for 2030:

  1. peak carbon dioxide emissions around 2030 and make best efforts to peak early,
  2. lower carbon dioxide emissions per unit of GDP by 60 to 65 percent from 2005 level,
  3. increase the share of non-fossil fuels in the energy mix to around 20 percent, and
  4. increase forest stock volume by around 4.5 billion cubic meters from 2005 levels.

Yet China is already moving ahead with a comprehensive set of measures that have put it on a path to peak its CO2 emissions much earlier and at a lower level than anyone had anticipated. In fact, China’s coal consumption has fallen for the past two years and may already have peaked in 2013:

China’s Coal Consumption

It's official: China continued to reduce its coal consumption in 2015 while growing its clean energy

Alvin Lin, 2016

In contrast, renewable energy in China is booming. China invested $102.9 billion in renewable energy in 2015, more than the U.S. and the European Union combined. Half of all wind power capacity and almost one-third of all solar PV capacity installed globally last year was in China.  China is installing one wind turbine an hour, and is building the world’s largest solar farm, which will include 6 million panels and cover more than 7,000 U.S east coast city blocks.

Not all of this renewable energy is being used. In 2015, 15 percent of China's wind energy and 9 percent of its solar energy was "curtailed," meaning that, for a variety of reasons, wind and solar energy production had to shut down because the electricity grid was not able to absorb the power that would have been generated. Yet, despite these challenges, power generation from wind and solar increased more than China’s total electricity demand in 2015.

In addition, as NRDC President Rhea Suh noted, China has built the world’s largest high-speed rail system, investing more than $500 billion to build some 12,000 miles of high-speed railroad connecting nearly every city in the country with a population of half a million or more. It plans to put three million electric cars on the road by 2025. And with 100 million rural residents planning to move into cities in the next five years – part of the largest and fastest urban expansion in history – China has adopted a series of ambitious targets for low-carbon urbanization.

Despite today’s historic news, much more still needs to be done, and time is of the essence. The evidence continues to mount that China is extremely vulnerable to the impacts of climate change, which is threatening the country’s food security, human health, even its infrastructure networks. We look forward to continued leadership from China on every front of the global battle against climate change.

Getting Tough on Climate Pollution: Limiting Warming to 1.5
David B. Goldstein

This blog series is an effort to present some preliminary thoughts on how the U.S. and other nations could limit the increase in global average temperature to 1.5 C.  My goal is to spark a conversation on this critical issue.

Part 1 of a 3 part blog: Why limiting climate pollution is an economic development strategy

The Paris Agreement established at the United Nations Framework Convention on Climate Change in 2015 sets a two-fold goal for the world’s nations: to hold the increase in global average temperature to below 2 degrees C above pre-industrial levels and to pursue efforts to limit the increase in temperature to 1.5 C, “recognizing that this would significantly reduce the risks and impacts of climate change." Limiting climate change to 1.5 degrees is a much-needed but previously unstated goal if the world is to avoid profound risks as well as the well-known costs and disruptions of severe climate change. Previous global climate accords had only included the goal of limiting climate disruption to below 2 degrees, and numerous studies have provided detailed blueprints on how to reach this goal.

The changes required will reduce costs, create jobs, and help solve other environmental, economic, and health problems, and will improve the bottom line and quality of life for typical families and businesses.

What about 1.5 degrees? What would it take to hold the line there? This essay shows what sorts of policies we would need to get there if the U.S. decides to adopt this as its target, and how these policies would produce jobs in the sectors that need the most help, and would also improve economic justice. As of October 5, 2016, 72 countries, accounting for about 57 percent of the world’s emissions, officially signed on to the Paris Agreement. This means that it surpassed the threshold required for it to enter into force—55 signatory countries, collectively accounting for 55 percent of the world’s emissions--and will go into effect on November 4. So thought leadership on this issue is timely.

Purpose

This essay has two goals: to inspire policymakers to take the goal of limiting climate change to 1.5 seriously and undertake the bold and audacious steps needed to do this right away; and to show that success is possible by explaining what it would take from a technology and behavioral point of view to do so.

These steps are interconnected. No one will undertake assertive new policies if they don’t see convincing reasons why they will succeed. For example, one will not attract athletes to train for a marathon race if you tell them the goal is to run the race in one and a half hours. (The world record is 2:02:57, so the goal clearly is impossible.) But if you try to convince them that merely finishing a marathon is important, even if you do it walking, you are much more likely to motivate people.

Therefore this paper first discusses what it would take to limit climate change to 1.5 degrees. It does this in a U.S. context, where we will likely have to be at zero emissions, on a net basis, by 2050 or earlier. Other countries may have less aggressive goals in terms of absolute reductions, and may be able to continue growing emissions for a few more years before their peak. (China, for example, has committed to peaking its emissions by 2030 but may already be near the peak.) This is discussed in part 3.

What do the 2-degree scenarios show?

Two-degree scenarios, both global and U.S. domestic, show that the biggest single overarching strategy is to improve the efficiency of energy use: better cars, refrigerators, and lights, walkable neighborhoods that don’t require much car use, buildings that require much less energy to heat and cool, etc. This conclusion emerges whether the study was done by the International Energy Agency or by NRDC.

They also feature greatly expanded reliance on renewable energy sources, primarily wind and solar, which are integrated into large-scale electric grids that allow strong performance in one place to compensate for weak performance somewhere else on the grid.

Efficiency pays for itself several times over, reducing energy bills for families and businesses. These reductions are particularly important for lower income households. Efficiency also produces local jobs both directly and then as a result of consumers spending the money that they previously had wasted on things that they really want.

Strong efficiency policies can correct seven key economic imbalances that have plagued the American economy since 1973; thus they are a necessary part of economic growth and justice. It is interesting to note that the median income of an American family was rising steadily until 1973, when oil prices tripled. Starting then, the trend went flat, and the median household income basically has not risen since then. While other factors no doubt are also to blame, long-established trends such as growing median income do not just stop suddenly for no reason, and the reason they stopped in 1973 cannot be unconnected from the rise in oil prices. The oil crises of the 70s triggered the highest U.S.  inflation in a century, as well as leading to a trade deficit. Energy accounted for over 10% of GDP after the price increase, so energy prices are big enough to have triggered the change.

The continuing stagnation of median income after the effects of the second oil price rise of 1979 had faded away corresponds to a time of weakness in energy efficiency policy: after the bipartisan energy saving laws of the 70s, America saw a fading of the commitment to fuel economy standards, not only for cars but also for refrigerators, air conditioners, and whole buildings. Therefore this narrative strongly suggests that efficiency policies are one of the few consensus steps we can take towards improving economic justice.

Renewable energy costs about the same as polluting energy, but it protects us from fluctuating fuel prices. It also produces jobs and reduces pollution.

While the level of effort needed to reach the two degree goal is high, most of the work is done by policy makers or by the businesses that produce clean energy options, who profit from all that effort. Thus families will not notice much difference. And most of the difference is beneficial: expanded mobility choices and greater availability of housing in walkable, transit-served areas, less air and water pollution, and lower utility bills. And businesses will not see much in the area of increased challenges to running their operations.

The difficulties will be borne by government and private sector organizations that implement energy policies, or by energy efficiency companies that will need to be started or need to expand their scale of operation radically (with profits to match.) The only businesses that will be challenged in a major way are traditional energy suppliers, who will need to diversify out of many of their current offerings.

 Californians can take pride in the knowledge that their state is already on track to meet the two degree goal, and they haven’t really noticed the difference.  But perhaps they have noticed that the clean energy economy is helping California to create more jobs than the rest of the country. And the United States as a whole seems on track in 2016 with that year's emissions target (based on actual emissions inventories from 2014), in large part because of actions taken by the Obama Administration and by the states, even without a Congressionally approved climate goal. But on the other hand, forecasts for the year 2025 all agree that we will fall short of meeting our goals for limiting climate change to 2 degrees unless we do far more with policies.

The last two observations—that we are on track for our 2 degree goal in terms of recorded emissions but also falling off the track for 2025—point out the dualism that runs throughout this essay:

  • We can feel confident that we can meet bold and aggressive goals, because in the times and places where we have tried to meet them, we are succeeding; however
  • We need to do far more in terms of policies to reduce emissions, at the global, national, regional, state, local, and private-sector levels.  This needs to be a process of continual improvement, as outlined in the Paris Agreement, in which initial goals are set, progress towards meeting them is tracked, and the experience gained with what succeeds better than expected and what falls short leads us to refine our policies and meet more aggressive goals on the next iteration. We should ALWAYS expect that actions taken to date will not be sufficient to get to our ambitious goal for the future because we will ALWAYS need to be ready to take additional steps as we find additional opportunities.

In summary, most of the things we need to do to meet the 2 degree target are things that we should do for other reasons even if climate were not an issue. We would do them to save money, clean the air, protect wild places, create jobs, protect the poor from high bills, and encourage competition and innovation in the economy.

Almost all of the technology-based studies nationally and internationally stop at the savings needed to meet the 2 degree goal, concluding that it is not difficult to identify the technical measures needed and explain convincingly how they would be deployed. These studies also show that we do not need new technological breakthroughs. We can rely on technologies that can already be identified and in most cases even priced, sometimes with predictable incremental improvements over time, and policies that are known to work.

These analyses are presented in a variety of forms, starting with the International Energy Agency’s Energy Technology Perspectives, a technical/policy report updated annually, and continuing with a number of other studies written by academic institutions and nonprofit organizations.

Thus it is widely accepted that the world knows how to meet a 2 degree target with economically logical technologies and with policies that have a record or success. Mobilizing these actions at scale and securing the political will to get it done will require sustained effort over many years. It won’t be easy, but if it were easy it would already be done.

Part 2 of this essay discusses what it will take to limit warming to 1.5 degrees.

China a Key Player in Aviation Emissions Agreement
Barbara Finamore Alvin Lin
ACCESS Biofuels Flight Tests on NASA's DC-8

NASA

China and the U.S. have put climate issues back into renewed focus by formally approving the Paris Climate agreement at the onset of the G20 summit this month. In several weeks, these two countries will have another opportunity to demonstrate climate leadership, this time by taking a stand against the growing carbon emissions from the aviation industry. From September 27th to October 7th, the International Civil Aviation Organization (ICAO), a UN agency, is meeting in Montreal to vote on an agreement to work towards “carbon neutral growth” in aviation post-2020. Because real aviation emissions are expected to rise dramatically in the coming decades, the ICAO hopes to achieve “neutral growth” through carbon offsets in a global market-based measure (GMBM). Previous attempts to address the environmental impacts of aviation have been stymied by a lack of international cooperation. For a meaningful ICAO agreement to be passed this fall, broad support will be required from the international community, especially from China, the nation with the fastest growing aviation sector.

What Is at Stake?

If global aviation was a country, it would have the 7th highest carbon emissions in the world. Aviation is currently responsible for 2% of global emissions and at least 4.9% of anthropogenic radiative forcing (a global warming impact measurement), but if left unregulated, aviation emissions have been projected to account for as much as 22% of global emissions by 2050. This is similar to global shipping, an industry of particular concern to NRDC, which accounts for nearly 3% of global emissions and is projected to account for 17% in 2050 if unregulated. Despite the threat that aviation poses to international climate efforts, aviation emissions were not formally addressed in the 2015 Paris conference, in part due to the difficulty of assigning responsibility to countries for the emissions of international flights, where often a flagship airline carrier from one country can fly routes from a second country to a third.

Aviation is projected to have an “emissions gap” of 7.8 billion tons of carbon pollution in excess of its carbon neutral goal between 2020 and 2040. Unfortunately, emission reduction strategies such as fuel efficiency and operational improvements will only make a small dent in this gap and viable sustainable biofuel still remains in its infancy. Instead, a GMBM that would require airlines to pay for carbon offsets, though controversial, may be the most politically feasible strategy for the aviation industry to address its growing fossil fuel consumption.

In China, the extraordinary growth of domestic aviation threatens to derail its own national climate goals. China pledged in the US-China Joint Announcement on Climate Change to peak its carbon emissions and raise non-fossil energy to 20% of its primary energy portfolio by 2030. Though China’s emissions growth has already begun to slow, projections of China’s aviation industry indicate that its aviation emissions will necessarily represent a climate challenge. By 2029, China’s domestic passenger aviation market is expected to be the largest in the world, surpassing the U.S., and by 2034, China is projected to have 1.196 billion passengers per year, up from 438 million in 2014. By 2050, aviation fossil-fuel use will have risen to 15.7%, up from 7.3%, of the total energy consumption in China’s transport sector. The scope of China’s projected aviation market makes China an essential player in any global effort to control aviation emissions.

The Fraught Journey of Emissions Trading in Aviation

Since the signing of the Kyoto Protocol in 1997, the ICAO has been tasked with regulating international flight emissions. However, it was not until the EU included aviation emissions in its emissions trading scheme (ETS) in 2012 that the ICAO was finally pressured to push for a global unified aviation emissions regulation system. Russia, the U.S., India, and China all opposed the EU’s unilateral action as the EU ETS would cover flag carriers from outside the EU flying in or out of EU territory. China threatened to block all contracts for Airbus purchases, and instructed its carriers to not comply with the EU ETS, as did the U.S. and India.

Faced with an impending trade war, at its 37th general assembly in 2013, the ICAO declared that it would use the next three years to establish a GMBM to regulate aviation emissions to be implemented in 2020. Negotiations on the specifics of this plan, however, have been mired in debate. As with other international environmental agreements, at the center of discussion is the question of how to pursue a regulation scheme that follows the spirit of the “common but differentiated responsibilities” (CBDR) principle first set forth at the United Nations Conference on Environment and Development (UNCED) in Rio de Janeiro in 1992. The aviation industry’s goal to achieve carbon neutral growth post-2020 necessarily creates a tension between nations with large, fully developed aviation markets (such as the U.S. and the EU) and nations with rapidly emerging aviation markets (such as China, Brazil, India).

There are a number of ICAO GMBM plans under consideration, and depending upon which one gets implemented, different nations could bear significantly different burdens in offsetting emissions growth. Under a 100% “individual” offset scheme, airlines would be responsible only for growth in their own emissions. With this scheme, the aviation industry in the U.S. and EU would only need to offset the minimal growth in emissions of their already saturated aviation market, while emerging aviation markets, like China’s, would face a significant offsetting burden. Under a 100% sectoral scheme, favored by China and other developing nations, airlines would pay for carbon offsets for a proportion of the emissions growth of the entire international industry.

As the 2016 ICAO General Assembly approaches, much of the discussion on the ICAO agreement has been focused on the timing of how the ICAO GMBM would be rolled out. The most recent ICAO proposal has divided its GMBM implementation into three phases:

  1. From 2021 to 2023, countries would have the option to opt into a pilot ETS program, where airlines would be responsible for a proportion of sectoral emissions growth based on either their 2016 or 2020 emissions.
  2. This pilot phase will be followed by the first “voluntary” phase from 2023-2026, ideally with more countries joining in, where offsets would be calculated on a 100% voluntary basis.
  3. From 2027 onward, all but the poorest nations would be required to participate, with offset responsibilities transitioning from a sectoral scheme towards an individual airline scheme.

China a Receptive Partner?

Despite its previous resistance to the EU’s ETS scheme, China has been very active in ICAO negotiations, putting forward proposals of its own, thereby raising optimism around China’s potential participation going forward. China’s positive engagement with the proposed international aviation GMBM may reflect its own increasing willingness to use market-based measures to tackle its own domestic environmental problems.

Starting in 2013, China established seven pilot ETS plans in five cities and two provinces. Through the end of June 2016, a cumulative 94 million tons of carbon have been traded in the pilot secondary markets, (worth approximately $349 million USD). In two of these pilot ETS programs in Shanghai and Guangdong, emissions from aviation are partially covered, including emissions from airports and two airlines in Guangdong (source in Chinese) and six airlines in Shanghai.

China will begin implementing a national ETS program starting in 2017, with an expected emissions cap size that will be twice that of the EU. Aviation will be one of the eight sectors covered in the national system. It is important to note that, in line with China’s climate commitments, China’s carbon emissions cap will be based on its carbon intensity reduction targets, and not necessarily total emission reduction targets. It will be of interest, then, to see how China’s coverage of domestic aviation emissions under its national ETS will correlate with an ICAO GMBM if one is adopted.

Lastly, as the world’s largest host of Clean Development Mechanism (CDM) projects (emission offsets that can be traded under the Kyoto Protocol), China will be pushing to be able to use as many of its own carbon offset credits as possible in the upcoming ICAO GMBM. However, as discussed below, it will be crucial that only the highest quality carbon offset credits be permissible for use in this scheme.

Striving for Real Progress

It is critical to remember that an ICAO GMBM plan can, at best, only offset the growth of aviation emissions. Carbon offsets have long been a controversial concept, and it should not be a surprise that over 80 environmental NGOs are opposed to an ICAO deal as “a distraction from real emission reductions.” However, a recent WWF/Stockholm Environmental Institute study has shown that enough “high quality” offsets (meeting the principles of additionality, permanence, and minimal leakage) exist to nearly satisfy the projected ICAO offset demand.

Unfortunately, China may be inclined to oppose any language in the upcoming ICAO agreement that places restrictions on which offsets are available for use under a GMBM. This is because of the fact that of the more than 50 million tons of carbon emission offsets that have been issued in China (source in Chinese), only a fraction of them, such as small hydroelectric and solar projects, would qualify as “medium quality” offsets under the WWF/Stockholm Environmental Institute study, while almost none of them would qualify as “high quality” offsets, which currently only include landfill gas and methane avoidance projects. (See the WWF’s categorization of offsets here). The rest of China’s offsets, which mainly include wind power projects, rural methane use projects, and large hydroelectric and solar projects, would be considered “low quality” offsets, likely because they would not meet the requirement of “additionality.”

Regardless of how offsets from any single country are treated, it is essential that the ICAO agreement adopt the strongest language possible regarding the quality of allowed carbon offsets, otherwise this agreement may be counterproductive.  

Already this year, the ICAO has produced weak environmental regulations. In February 2016, the ICAO passed a binding CO2 efficiency standard, which will not come into effect until 2028, at which point most airlines will have likely already improved their fuel efficiency beyond the ICAO standard.

Lastly, for the ICAO agreement to be effective, it is essential that there is maximum participation in the GMBM plan as early as possible. If the participation of developing nations in the ICAO’s GMBM plan is delayed, an estimated 30 to 50% of aviation emissions will not be covered during the first phases, reducing the credibility of the “neutral growth” emissions standard put forth by the aviation industry. There is good news, however, on this front. On September 3rd, China announced its willingness to be an “early participant” in the voluntary phase of the current ICAO plan. This move will hopefully put pressure on India and other nations with developing aviation markets to participate in the ICAO GMBM in the early voluntary phases.

Controlling aviation emissions is an important step in averting disastrous climate change. The upcoming ICAO meeting is a critically important opportunity to take truly meaningful action. 

This post was co-authored by NRDC Princeton in Asia Fellow Noah Lerner.

WASHINGTON – More than 80,000 Americans joined dozens of mayors, business leaders, environmental and consumer groups, and state and city transportation officials in calling on the Obama administration to reduce carbon pollution from the nation’s transportation system and  promote cleaner and smar

Truck Standards Deliver Big Savings
Luke Tonachel

New fuel efficiency standards for heavy trucks announced today by the Obama Administration will save money and dramatically cut carbon pollution. The standards will drive manufacturers to adopt cost-effective technologies so that, by 2027, new trucks will guzzle up to 25% less fuel when hauling goods.

These latest fuel efficiency rules round out a suite of standards for automobiles and commercial trucks and buses that are essential for reducing U.S. dependence on oil and reducing greenhouse gas emissions.

Cleaner Transportation

Like the clean car and fuel economy standards for automobiles, these heavy truck efficiency standards are one of the most tangible, immediate steps we can take to address climate change. Trucks are energy hogs of the highwaythey account for about 20 percent of our transportation fuel and carbon pollution, but make up only about 5 percent of all vehicles on the road.

As the U.S. population grows, we tend to consume more goods—which are shipped by truck—and to drive more. Strong vehicle efficiency standards counteract this growth and reduce the total pollution from transportation. By 2030, the Energy Information Administration projects that largely thanks to vehicle standards, transportation sector carbon emissions will be at least 20% below the levels they’d be at without them.

Transportation Sector Carbon Pollution (million metric tons of carbon dioxide)

Source: Energy Information Administration, Annual Energy Outlook 2010 and 2016.

Without standards, transportation sector emissions would be growing rapidly.

Moving Goods for Less Money

Efficient trucks deliver goods using less fuel, which saves businesses money – and consumers are likely to benefit from some of that savings. That’s why companies that rely on trucking fleets support strong efficiency standards.

Truckers and trucking companies that invest in the technologies to meet the new 2027 standards will see fuel savings in as little as two years for the biggest energy hogs: tractor-trailer rigs. For all trucks, the fuel savings will outweigh the costs of new efficiency technology early in the vehicle’s lifetime.

Truck manufacturers are supporting the standards because they are confident that they can deliver fuel-saving trucks that will satisfy their customers.

Impact of 2027 Heavy Truck Standards

Regulatory Category

Share of Total Heavy Truck Fuel Consumption

Emission Reduction from 2018

Increase in Typical Vehicle Price

Payback year*

Combination Tractors

60%

19-25%

$12,442

2nd

Vocational Vehicles

17%

Up to 24%

$2,662

4th

Heavy Pickups and Vans

23%

16%

$1,364

3rd

*Ownership year in which the fuel savings surpass the incremental cost. Source: EPA, DOT Final Rule.

One upgrade that will be key for meeting the standards is improvements to conventional engines, which are primarily diesel-fueled. The agencies strengthened the engine requirements modestly from last year’s proposal to help make sure that cost-effective, fuel-saving technologies are adopted.

Other changes truck manufacturers are expected to make to meet the standards include:  improvements to transmissions, use of idle reduction technologies, more efficient axle configurations, better aerodynamic design, lower rolling resistance tires and weight reduction.

Freightliner Truck Built to Maximize Efficiency

Matt Dozier, U.S. Department of Energy

Here’s one change worth noting: trailers are also included in the heavy truck efficiency standards for the first time. Those big boxes that sit behind heavy-haul tractors are a huge drag. By applying aerodynamic fittings (such as side skirts and rear-end “boat tails”), low-rolling resistance tires and lightweight structural components, 2027 trailers are expected to cut a tractor-trailer’s fuel consumption by 9% on average. With an incremental cost of about $1,108, truckers would see a payback within two years.

In all, the new heavy truck standards will save over 80 billion gallons of fuel and avoid over one billion tons of carbon pollution. Benefits worth more than $230 billion will accrue over the lives of the new 2021-2027 trucks. And if you compare that benefit with a price tag of about $25 billion in technology costs, it’s a program that pays for itself many times over.

Strengthening U.S. Competitiveness

Truck manufacturers in the U.S. benefit from strong fuel efficiency standards because they drive innovation and competition. Truck and engine makers like Volvo, Cummins, Daimler and Navistar have global footprints, so technology advancements made here in the U.S. can be sold around the world.

Canada has already announced that it would new adopt new truck standards that mirror our new standards. China is moving forward with tighter truck fuel efficiency regulations. Recently, European truck manufacturers—some with deep ties to U.S. companies—were fined $3.2 billion for forming a cartel that delayed the implementation of emissions-control technologies and increased costs for businesses. Clean transportation advocates in Europe argue that fuel efficiency standards could foster competition that will advance clean truck innovation into the market.  

The final heavy truck standards are good for the environment and the economy. They are a win-win because they reduce pollution while spurring innovation that saves truckers and consumers money. These rules also complete a package of vehicle efficiency and emissions standards that started with the first round of automobile standards finalized in 2010. Collectively, these rules will dramatically reduce our pollution, clean our air and help protect the planet. And that helps us all breathe easier. 

Cities Can Lead the Way to Clean Transportation Plans
Deron Lovaas

Watching the Olympics has been fun and exciting, as always. And if we pull the lens back, we can see that Rio de Janeiro is part of another competition, namely the competition to solve climate change as dramatically underscored in the Opening Ceremonies.

Thankfully, although many investments made by host cities turn out to be of little use to a city after the Games, much of Rio’s transformative redevelopment may have lasting value. It’s far from a foregone conclusion based on past experience, but if it works it will be due to leadership by Rio Mayor Eduardo Paes working with the C40 Cities Climate Leadership Group. As C40 chair, he talks about his dedication to urban sustainability in this inspiring piece he co-authored with the mayor of Paris.

Overall, there’s an emerging trend—cities stepping up as problem-solvers in the age of climate change.

For example, yesterday the Sierra Club published a new report profiling 10 cities in the U.S. that are shifting to clean energy. In June, the Center for Climate and Energy Solutions and the U.S. Conference of Mayors launched a new Alliance for a Sustainable Future, which will build better partnerships between states and cities and promote best practices in urban areas. And NRDC’s own City Energy Project is building on its work with pioneer cities nationwide to boost the energy efficiency of commercial building stock.

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Now the Federal Highway Administration (FHWA) has the chance to add to this trend by requiring that long-range transportation plans developed by metropolitan areas go for the gold in the race against climate change—a new performance standard for taxpayer-funded plans to track greenhouse gas pollution and set targets for reducing it.

NRDC and our partners at the Center for Neighborhood Technology and the United States Public Interest Research Group filed detailed comments about the proposal this week, and I urge you to read them and share them. The Center for American Progress and the National League of Cities this week endorsed the proposal as well.

This commonsense proposal is understandably popular as this recent poll shows.

Pollution from transportation sources is a big problem, and cities can’t tackle it alone. They need collaborators, specifically in their metropolitan planning organizations (which include suburbs like Washington, D.C.’s College Park, MD, where I live) and state departments of transportation. These government agencies forge long-term transportation plans directing billions of dollars of investments in coming decades.

The simple truth is that a new performance standard for greenhouse gas pollution from our nation’s metropolitan and state transportation plans would catalyze that work and take a big stride toward solving climate change, with our cities leading the way.

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