PLANNING POLICY AND EMISSIONS REDUCTION: DO THE RESULTS MATCH THE HYPE?

Timothy F. Welch

University of Maryland

National Center for Smart

Growth Research and Education

ACSP

53rd Annual Conference

November 2, 2012

The Imperative

Reduce GHG emissions and atmospheric C02Concentrations before 450PPM

– To hold a +2oc global temprature change

– Avoid catastrophic anthropomorphic climate destabilization

R² = 0.9916

300

310

320

330

340

350

360

370

380

390

400

410

420

430

440

450

460

CO

2 (

PP

M)

Year

CO2 Concentration 450 (PPM) 350 (PPM) CO2 TrendAtmospheric CO2,Mauna Loa Observatory (Scripps / NOAA / ESRL)

New Evidence

• Total amount of CO2 that can be emitted between 2000 and 2050

• 80% chance of maintaining a 2oC warming (compared to pre-industrial period)

886gigatons

• From 2000 to 2011:

• 337gigatons CO2emitted

549gigatons

• of CO2 left for next 38 years

M. Meinshausen et al., Nature 458, 1158 (2009).

Research Questions

• How likely are state climate strategies to meet

GHG reduction policy goals?

• How well do the policies conform to the new

evidence on needed GHG reduction needs?

Policy TargetsInternational Origin

IPCC’s 2007 Fourth Assessment Report - Annex I

(developed) countries need to reduce GHG

emissions 25-40% below 1990 levels by 2020,

and 80-95% below 1990 levels by 2050, in order

to stabilize below 450 ppm CO2-eq

concentration, after a temporary overshoot by

50 ppm

IPCC AR4 WGIII. Climate Change 2007: Mitigation of Climate Change. WGIII Contribution

to the IPCC AR4 (Cambridge University Press, Cambridge, 2007), chapter 13, Box 13.7 on

page 776.

Policy TargetsNational Policies

ACT TARGET

Climate Stewardship Act of 2007 (Olver-Gilchrest) H.R.620 &

H.R. 4226 (Died – at Introduction and Committee, respectively)70% below 1990 level in

2050

Global Warming Reduction Act of 2007 (Kerry-Snowe) S.485

(Failed)62% below 1990 level in

2050

Climate Stewardship and Innovation Act

(McCain-Lieberman) S.280 (Failed – 2003/5/7)60% below 1990 level in

2050

Global Warming Pollution Reduction Act (Sanders-Boxer) S.

309 (Proposed - 2007)80% below 1990 level in

2050

Lieberman-Warner Climate Security Act of 2008, S.3036

(Died in Senate)71% below 2005 level in

2050

American Clean Energy and Security Act of 2009 (Waxman)

H.R. 2454 (Died in Senate)83% below 2005 level in

2050

Executive Branch – EPA can regulate CO2 as a pollutant

Pledge to the United Nations17% below 2005 level in

2020

Energy Tax Prevention Act of 2011 (Upton) H.R.910 (Passed

House – April 07, 2011)Bars EPA from taking

any GHG related action

Policy TargetsState Policies

6

1 1 1

12

2

0

2

4

6

8

10

12

14

2010 2012 2015 2017 2020 2025

1st Target date

0123456789

10

10%

below

1990

5%

below

1990

1990 2000 2005 15%

below

2005

20%

below

2005

25%

below

2006

30%

below

buiness

as usual

1st Taret Level n=23

7

2

1 1

7

0

2

4

6

8

2020 2025 2035 2040 2050

2nd Target date

0

1

2

3

4

5

6

1990 10%

below

1990

25%

below

1990

60%

below

1990

75%

below

1990

80%

below

1990

10%

below

2000

50%

below

2000

80%

below

2001

30%

below

2005

80%

below

2005

80%

below

2006

2nd Taret Level n=18

Source: Author’s Calculations

Policy TargetsMaryland Policy

GREENHOUSE GAS REDUCTION ACT OF 2009

• Reduce statewide GHG emissions 25% from 2006 levels by 2020

• By 2011 MDE to:

– develop a 2006 Statewide greenhouse gas emissions inventory;

– develop a projected “business as usual” emissions inventory for 2020; and

– develop/publish for public comment a proposed plan

• Adopt final plan to achieve reductions, by 2012

GREENHOUSE GAS REDUCTION ACT OF 2009

• Plan must ensure:

– no loss of existing jobs in the State’s manufacturingsector;

– net increase in State jobs

– net economic benefit to the State’s economy;

– opportunities for new “green” jobs in the energy and low carbon technology fields; and

– no adverse impact on the reliability and affordability of electricity service and fuel supplies

Policy TargetsMaryland Policy

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Population

Per Capita GDP

Energy Intensity

Carbon Intensity

1

2

3

4

XX

XX

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Current Strategies• T-1. Maryland Clean Cars Program

• T-2. National Medium- & Heavy-Duty Fuel Efficiency Standard

• T-3. Clean Fuels Standard

• T-4. Transportation and Climate Initiative

• T-5. Public Transportation Initiatives*

• T-6. Double Transit Ridership by 2020*

• T-7. Intercity Transportation Initiatives*

• T-8. Bike and Pedestrian Initiatives*

• T-9. Pricing Initiatives

• T-10. Transportation Technology Initiatives

• T-11. Electric Vehicle Initiatives

• T-12. Low Emitting Vehicle Initiatives

• T-13. Evaluating GHG Emissions from Major New Projects

• T-14. Airport Initiatives

• T-15. Port Initiatives

• T-16. Freight and Freight Rail Strategies

• T-17. Renewable Fuels Standard*

• T-18. CAFE Standards (MY2008-2011)

• T-19. Promote Hybrid & Electric Vehicles

• T-20. Pay-As-You-Drive Insurance

Target in Context

• In 2010– Total GHG reduction less than 9% in midst of greatest recession

since 1930s

– 26% industrial reduction, due to lower activity

– 15% power plant reduction, due to natural gas prices

– 6.5% transport, less commuting less activity

– Increases in commercial and residential

• All likely temporary reductions, 2011-12 expect increases

• Recommended reductions greater than entire GHG output of:– Commercial,

– Residential,

– Industrial,

sectors combined

Baseline/Current/Target GHG

0

5

10

15

20

25

30

35

40

45

50

55

60

65

70

75

80

Maryland Commercial Industrial Residential Transportation Electric Power

MM

T C

O2

2006

2010

2020 Target

Energy Consumption by Source

0

5

10

15

20

25

30

Av

era

ge

MP

G

Year

Historical CAFE Standards and Average US Fleet Economy

LDV MPG

New Method

CAFE

Price Assumption

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

0

50

100

150

200

250

300

Ga

s P

rice

(p

er

gall

on

)

CP

I

Year

CPI (projected) Annual (Ave.) CPI Gas Price (nominal)

R² = 0.9881

15

20

25

30

35

40

45

50

55

Av

era

ge

MP

G

Year

Historical & Projected CAFE Standards and Average US

Fleet Economy CAFE

LDV MPG

Poly. (LDV MPG)

Inventory and Goals

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

CO

2 (

ton

s/d

ay

)

CO2 By County

2006 2020 2020 Target (SHARE)

$0.08

$0.09

$0.10

$0.11

$0.12

$0.13

$0.14

$0.15

$0.16

AO

C (

$/m

ile

)

Year

Scenario Auto Operating Cost ($/mi, 2000 Constant Dollars)

BAU Gas Tax ($0.50) Gas Tax ($2.00) VMT Tax ($0.50)

VMT Tax ($2.00) CO2 Tax ($25/ton) CO2 Tax ($50/ton) CO2 Tax ($75/ton)

2006/2020/Target(Statewide Implementation)

R² = 0.9005

23

25

27

29

31

33

35

37

39

Yea

rly

CO

2e

(M

MT

)

Year

Transportation GHG Emissions

Historic

Baseline

2020

Proportional

Target

Gas Tax

($0.50)

Gas Tax

($2.00)

VMT Tax

($0.50)

VMT Tax

($2.00)

CO2 Tax

($25/ton)

CO2 Tax

($50/ton)

CO2 Tax

($75/ton)

Power

(Historic)

2006/2020/Target(Statewide Implementation)

23

25

27

29

31

33

35

37

39

Yea

rly

CO

2e

(M

MT

)

Year

Transportation GHG Emissions

Historic

Baseline 2020

Proportional Target

Gas Tax ($0.50)

Gas Tax ($2.00)

VMT Tax ($0.50)

VMT Tax ($2.00)

CO2 Tax ($25/ton)

CO2 Tax ($50/ton)

CO2 Tax ($75/ton)

Efficiency (65mpg)

Hybrid Max

2006/2020/Target(Statewide Implementation)

9

11

13

15

17

19

21

23

25

27

29

31

33

35

37

39

Yea

rly

CO

2e

(M

MT

)

Year

Transportation GHG Emissions

Historic

Baseline 2020

Proportional Target

Gas Tax ($0.50)

Gas Tax ($2.00)

VMT Tax ($0.50)

VMT Tax ($2.00)

CO2 Tax ($25/ton)

CO2 Tax ($50/ton)

CO2 Tax ($75/ton)

Efficiency (65mpg)

Required Target

Hybrid Max

Conclusions/Recommendations

• Establishing ‘fantastical and magical’ strategies and targets only distracts from important policy goals

• Provides a ‘way out’ for policy makers– By looking tough, but doing little

– Likely a set-up in many states for a cap and trade program to generate revenue

• Need to formulate a multitude of realistic strategies, test and incrementally ramp-up or replace

• Policy formulation through jurisdictional convergence– As opposed to “set it and forget it” mentality

Conclusions/Recommendations

Jurisdiction Planned

Target Year

Year CO2 Budget

Exceeded

(w/o CAP)

Year CO2 Budget

Exceeded

(w/ CAP)

Maryland 2020 2027 2029

United States 2050 2028 2031

World 2050 2026 2033

Conclusions/Recommendations

• For Maryland to do its part in keeping 20C within 20% probability

– Can only emit 1,113 Mt CO2 from 2012 – 2050

• Compared to current trend: 2,754 Mt CO2

• And current CAP: 2,318 Mt CO2

– Need to aggressively change target

• From: 25% below 2006 by 2020

• To: 70% below 2006 by 2020

• Or: 68% below 1990 from 2020 – 2050

– AND HOLD CONSTANT

Conclusions

To keep 80% chance of 2oC pre-industrial:

• Not only do the likely policy results not match

the ‘hype’

• The hype does not match the need

Jurisdiction Target Year Reduction Year Percent Below Avg. Annual Reduction

(from 2012)

Maryland 2020 2006 70% 8% (65%)

United States 2033 1990 80% 3.73% (82%)

World 2039 1990 80% 3.23% (87%)