Portland Set to Approve Public Shaming of Building Owners

For members of the Portland City Council, the end always justifies the means.

Their current obsession is energy use in commercial buildings. On April 15 the Council likely will approve a regulation to require the owners of such buildings to: (1) monitor energy consumption; (2) calculate an “energy use intensity” score; and (3) file annual reports with the city.

Advocates claim that this will be good for building owners. It will give them information they would never get without prodding by bureaucrats, and provide market recognition for high-performing buildings.

In fact, this is just an effort to shame building owners and tenants into adjusting their behavior to conform to the political edicts of City Hall. Commercial buildings consuming “too much” energy will receive a Scarlet Letter and be harassed by bureaucrats and activists into expensive energy conservation retrofits, many of which will make no financial sense.

Energy consumption is a private matter. The Portland City Council should stand down on this proposal and leave people alone.

Human Achievement Hour 2015

This Saturday you’ll have the opportunity to vote with your light switches. Either turn your lights off from 8:30 pm to 9:30 pm local time to “show your commitment to climate change action now” or turn your lights on to celebrate “human progress and our advancements in various fields of industry, including technology, medical, energy, and more.”

Turning your lights off makes you part of Earth Hour, a project of the World Wide Fund for Nature (WWF). Turning them on makes you a part of Human Achievement Hour 2015, a project of the Competitive Enterprise Institute (CEI).

Since this isn’t a secret ballot, I’ll tell you that I’m voting for Human Achievement. As CEI notes, “Earth Hour does little to protect the environment” and “completely ignores how modern technology allows societies around the world to develop new and more sustainable practices that help humans be more eco-friendly and better conserve our natural resources.”

You don’t have to wait until Saturday to see what a large-scale expression of the “dark ages” versus human achievement looks like. Just check out any NASA nighttime photo of North and South Korea from space: “North Korea is almost completely dark compared to neighboring South Korea….The darkened land appears as if it were a patch of water joining the Yellow Sea to the Sea of Japan.”

North Koreans may simply be celebrating Earth Hour every hour of every day, but somehow I doubt it.

How the Environmental Left Became the New Climate Deniers

By Todd Myers

“The UN’s Intergovernmental Panel on Climate Change raises the level of alarm….Global warming deniers are now on a par with Holocaust deniers…” Ellen Goodman, The Boston Globe, 2007

When the United Nation’s Intergovernmental Panel on Climate Change (IPCC) released its report in 2007, the response of the environmental left was close to hysterical. The IPCC’s international mandate was so clear, the left called its findings the “climate consensus.” People who questioned the IPCC’s authority, some said, had the mentality of Holocaust deniers.

Recently, the IPCC released a new assessment, with improved calculations of global temperature increases and associated impacts. The new predictions are less dire and the IPCC’s old fans have become the new climate deniers, dismissing the new report as “political.”

Rather than follow the science, liberal politicians and environmental activists are denying today what they said was undeniable yesterday.

For example, writing in The Wall Street Journal just before the release of the new report, actress Darryl Hannah, who frequently protests with climate scientist James Hansen, says action is needed “urgently, if we are to avoid a 4-degree Celsius raise.” Her claim, however, was wrong before the new report was released and is more so now.

The latest projection of the IPCC for temperature increase under the most likely scenario is 1.8 degrees Celsius by the year 2100―less than half what Hannah claims. In fact, her claim is beyond the median projection for the most extreme scenario of 3.7 degrees C.

Claims about sea level are similarly inaccurate. The Sightline Institute claimed “the world’s leading climate scientists warn of the sea level rising by three feet by 2100.” On Twitter, Northwest NPR was even more extreme, asking how Seattle “would be affected if sea levels rise 1 foot by 2020.”

Under the most likely emissions scenario, sea levels will increase about 18 inches by 2100. The most extreme scenario projects an upper limit of sea level rise of 32 inches―less than the three feet claimed by Sightline. NPR’s 2020 estimate is wildly exaggerated, more than ten times the IPCC’s estimate.

Finally, Washington Governor Jay Inslee repeatedly mentions ocean acidification as a reason to take action on carbon emissions. Pointing to shellfish mortality in Washington’s waters, he claims, “We know that two of the most challenging threats we face to our environment are climate change and ocean acidification.” The pH of our waters, he notes, has recently acidified at the rate of about 0.1 per year.

Less than one percent of that trend, however, can be attributed to CO2 emissions. The IPCC reports, “The pH of ocean surface water has decreased by 0.1 since the beginning of the industrial era.” The acidification the Governor attributes to carbon emissions annually is actually the amount that occurred over more than 100 years.

Some realize their cataclysmic projections are no longer in line with consensus science. Instead of adjusting their claims, they turned to undermining the IPCC instead.

One New York Times columnist accused the IPCC of “bending over backward to be scientifically conservative,” claiming it was intentionally low-balling projections for political reasons.

Another left-wing environmental activist was even blunter, arguing “the IPCC report is more of a political document than a scientific one.” That is exactly the view of the best-known climate “denier,” Oklahoma Senator James Inhofe, who told an audience prior to the last IPCC report, “This is a political document, not a scientific report.”

The left has abandoned the IPCC, after years of touting the agency’s unshakable standard of excellence. What changed were not the IPCC’s standards but its conclusions. New science has sparked the left’s new denial.

Real solutions to any risks associated with carbon emissions will come only when policies are consistent with the latest science. The new, left-wing science deniers have made it clear they are more interested in trimming the science to suit their pre-determined politics. As a result, they don’t just deny the science, they deny the solutions for a cleaner Earth, too.

Todd Myers is director of the Center for the Environment at Washington Policy Center and a guest contributor at Cascade Policy Institute. He is the author of the book Eco-Fads: How the Rise of Trendy Environmentalism Is Harming the Environment and is designated a Wall Street Journal Expert panelist for energy and the environment.

It’s Time for Renewable Energy to Stand on Its Own Legs

The Energy Trust of Oregon (ETO) is a non-profit organization that carries out energy efficiency activities on behalf of PGE, Pacific Power, NW Natural Gas, and Cascade Natural Gas. ETO also subsidizes the above-market cost of small, renewable energy projects. For 2014, ETO proposes to spend $178.9 million while taking in revenues of $163 million. Revenues are derived from monthly surcharges on the bills of utility ratepayers. The state legislature authorized the imposition of these surcharges (ranging from 3% to roughly 6%, depending on the utility and the year) in legislation adopted in 1999.

ETO’s budget is available for public review and comment (www.energytrust.org) through the end of November 27, 2013 and will be approved by the ETO board in December. Cascade President John A. Charles, Jr. filed the following comments with with Margie Harris, Executive Director of the Energy Trust of Oregon, on November 27:

Dear Margie,

I have listened to your budget presentation twice and also attended the most recent Renewable Energy Advisory Committee (REAC) meeting. Based on those observations I have one suggestion for the 2014 budget/action plan:

Consider shifting the emphasis for renewable energy subsidies away from intermittent sources. Since 2003, ETO has supported the development of 5,217 renewable energy projects of 20 MW or less. Almost all of these projects―99.6%―have been solar and wind, the two most expensive categories. Yet, because these technologies fail to produce any electricity most of the time, wind and solar projects have only accounted for 40.5% of the power generated by all ETO projects.

Not only has the ETO renewable program had high costs with low power output, most of the alleged social benefits of these sources don’t exist because the random failure of wind and solar means that the system operator for the regional grid has to maintain ever-growing amounts of spinning reserve. These back-up sources have adverse environmental effects that are not accounted for by the recipients of ETO subsidies. In essence, wind/solar project owners internalize the benefits of ETO subsidies while externalizing the costs of grid reliability.

In your 2014 draft budget, you propose to spend $9.9 million on solar projects to get 0.9 aMW of power, at a levelized cost of 10.4 cents/kwh. This is roughly triple the cost of your other renewable projects. I don’t think this is a good deal for ratepayers, and it’s not a good deal for the grid.

The “final frontier” for ETO should be to invest in renewable projects that produce reliable, dispatchable electricity. The regional grid craves stability; wind and solar create volatility. This is a fundamental system conflict, and ETO should strive to be part of the solution by terminating future subsidies for intermittent sources.

At the last REAC meeting, someone on your staff noted that solar projects are proceeding even without the Business Energy Tax Credit (BETC) [repealed by the Oregon legislature in 2012] due to declining solar costs of some 40% over the past 4 years. This should not be surprising if you understand the term “co-dependent.” In technological development as well as human interaction, when we stop rescuing people from their own failures, they tend to become self-reliant a lot faster. I’d suggest that after subsidizing 5,000 solar projects, it’s time for ETO to declare victory and move on, allowing this industry to stand on its own legs.

Sincerely,

John A. Charles, Jr.

Cascade Policy Institute

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

The Portland Streetcar: Time to Reset the Vision

If some Portlanders are confused about why we have a 19th century trolley operating in a 21st century city, they are not alone. City leaders are confused as well.

According to the Streetcar Concept Plan adopted by the Portland City Council in 2009, there are three primary policy goals related to streetcar expansion: (1) help the city achieve its peak oil and sustainability strategies; (2) provide an organizing structure and catalyst for the city’s future growth along streetcar corridors; and (3) integrate streetcar corridors into the city’s existing neighborhoods.

Oddly, providing transit service is not an explicit priority, even though that’s the primary reason people ride. Instead we have a mishmash of peak oil mania―now a quaint artifact due to the shale oil and gas booms, coupled with advanced technology―and vague references to real estate development. Given that this plan was estimated to cost $750 million and the city is broke, perhaps we should rethink the objectives.

First, the fundamental purpose of any transit program is to move people. On this criterion, the trolley is a weak performer. It’s slow, it doesn’t go many places, and each car only has 30 seats. It has high costs and low capacity, when what we need is the exact opposite.

If a secondary purpose of the streetcar is to encourage development, there are much better ways to do so. Subsidizing the streetcar means that most property owners will never benefit, because the system is tiny―seven route-miles after two decades of planning. If the city were simply to streamline the permitting process and lower System Development Charges, we would incentivize far more development in all sectors of the city compared to laying another mile of track.

Advocates claim that streetcar lines are “permanent” and provide stability for nearby development, but thousands of miles of streetcar tracks in the United States were paved over when they became obsolete 80 years ago. More recently, the streetcar tracks in South Waterfront along Moody Avenue have been torn up three separate times since 2011 to accommodate light rail. Nothing is really permanent; and when change is needed, it’s a lot easier moving a bus line than it is ripping up streetcar tracks.

A Better Way

We should insist that the streetcar be treated as a transit expenditure and evaluated on those terms. If we do this, it’s clear that rubber-tired vehicles traveling on the existing road network make much more sense.

Of the bus options I’ve examined, the best one is the Metro Rapid in Los Angeles. This system relies on distinctive, low-floor CNG buses with red stripes providing fast, reliable transit service. It operates in general purpose traffic lanes and achieves relatively high speeds by having stops spaced 0.75 miles apart, on average.

Also, the Metro Rapid buses have the technical capacity to shorten a red light or extend a green light at intersections to improve travel time.

A summary of the key characteristics of this system compared with the Portland Streetcar is shown below:

LA Metro Rapid Bus

Portland Streetcar

Year opened

2000

2001

Annual boardings

72 million

4.1 million

System length

400 miles

7 miles

Capital cost/mile

$0.35 million

$29 million

Peak frequency of service

Every 3-10 minutes

Every 14-19 minutes

Average speed

14-30 MPH

7-12 MPH

The Portland Streetcar is 83 times more expensive to build than the Rapid Bus alternative. Is it 83 times better? No. In fact, it is not superior by a single metric. The Rapid Bus is cheaper, twice as fast, and has much greater coverage throughout the city. It’s an actual transit system, not a Disneyland ride.

We should stop further expansion of the streetcar and shift public resources to low-cost, higher-speed bus transit.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

“Pacific Coast Collaborative” Sends Kitzhaber Back to the Future

Last week Governor John Kitzhaber joined with other political leaders in the Pacific Coast Collaborative to call for a carbon tax. This announcement coincided with the official opening of California’s “cap-and-trade” program for reducing carbon emissions.

 

It’s not clear why Gov. Kitzhaber thought it was a priority to fly to San Francisco to make this announcement. Apparently, he’s forgotten that the Oregon legislature considered a “cap-and-trade” program in 2009, and the bill couldn’t even get out of committee – despite the fact that Democrats had a supermajority that year. Like elected officials in most other states, Oregon legislators correctly determined that “cap-and-trade” is just a fancy way of saying “carbon tax,” and taxing energy would be enormously unpopular with voters.

 

The governor is also overlooking the fact that just last year, Oregon left the Western Climate Initiative, a multi-state coalition expressly established in 2007 to facilitate carbon regulation across the West and into Canada. Oregon departed for the same reason every other western state besides California did: Taxing carbon is a political loser. No one outside the far-left environmental movement cares.

 

The job of any governor is to be a leader. Calling for carbon regulations that have been rejected multiple times is the opposite of leadership. Surely Gov. Kitzhaber can find something to do that’s more relevant to Oregon’s future.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

SunShot Makes Solar Energy a Long Shot

President Obama’s Fiscal Year 2013 budget includes $310 million for an ongoing energy research program called SunShot. The goal of the program is to use taxpayer subsidies to reduce the total installed cost of solar energy by 75% by the end of this decade, making it cost-competitive with other sources.

This is an admirable goal, but linking it to ongoing subsidies virtually guarantees that it won’t be met. There is no reason for private companies to develop inexpensive technology when politicians keep giving away money each year for research.

We’ve already seen this approach fail in Oregon. In 1999, the state legislature passed a law requiring that most consumers pay a three percent surcharge on their monthly electric bills to subsidize “market transformation” for renewable energy. Legislators and lobbyists agreed that the tax – which came to be known as the “Public Purpose Charge” – would go away after ten years, at which time green power was expected to be cost-competitive with coal and natural gas.

The ten-year anniversary of the Public Purpose tax will arrive on March 1, and solar energy is still wildly uncompetitive with other sources. And not surprisingly, politicians have reneged on the promise to end the tax; it was quietly extended five years ago to 2026 by the legislature, with no public discussion. This will cost consumers billions of dollars.

Politicians never seem to learn: Subsidizing failure simply begets more failure.

 

Germany’s Energy Mistake of Nuclear Proportions

By Gordon J. Fulks, Ph.D.

“Quem deus vult perdere, dementat prius ― Whom the gods would destroy, they first make insane.”

Germany’s precipitous decision to shut down eight nuclear power plants last March and the remainder by 2022 is curious coming from a German chancellor with a doctorate in physics. Under pressure from Greens who exploit scientific illiteracy and promote fears they find useful, Chancellor Angela Merkel has become a pure politician. Nuclear power evokes many fears in Germany. As in the English-speaking world, irrational perceptions about technical matters from nuclear energy to alternate energy to global warming transcend all reason.

The German political situation started to melt down after the most powerful earthquake and tsunami in modern times struck Japan in March: More than 24,000 people lost their lives, and the Japanese nuclear power installation at Fukushima made ominous headlines for weeks. With reports of radiation leaking from three reactors and large evacuations of the local population, European Energy Commissioner Gunther Oettinger of Germany declared the nuclear incident to be an “apocalypse.” Three reactors out of 11 in the Fukushima area were destroyed, resulting in large economic losses and a long, complex cleanup. But the widespread devastation elsewhere was the real tragedy.

Of the huge death toll, not a single death was attributed to nuclear radiation. Two workers at Fukushima died from drowning and one from a heart attack. Although two other workers received non-life-threatening radiation burns from standing in highly radioactive water, no one died from radiation sickness. The large amount of dangerous iodine-131 initially released has largely decayed away.

Long-term effects attributable to radiation exposure should be minimal, even among those workers who received the largest doses as long as established procedures to limit total exposure were followed. In the far worse Soviet Chernobyl accident in 1986, where the reactor burned and workers were unprotected, 57 died from direct effects and 500 in the local population from telltale thyroid cancer. But the vast majority of the population escaped unharmed.

The rational response to major industrial accidents is to carefully understand what went wrong and make improvements to existing procedures and infrastructure to minimize the chance of a recurrence. Because Germany uses far better reactor designs than the Soviets had and experiences few giant earthquakes and tsunamis like those in Japan, these disasters are not particularly pertinent to them. Moving toward more wind and solar power was the politically expedient decision for Merkel, but it has huge practical and environmental drawbacks. Because windmills and solar arrays produce very erratic electricity, backup from new turbine power plants burning natural gas is necessary. Leaving conventional steam plants running as “spinning reserve” is hugely wasteful.

That raises the inconvenient question: Why not just build advanced and highly efficient gas turbines and forget about expensive alternate energy? Wind and solar installations typically fail in 20 years, just as they have paid back the energy and cost of their construction. In other words, they produce little net energy, making them very inefficient. Their erratic nature also means that they reduce the reliability of the grid.

Germans are likely to get the additional natural gas they will need from their present supplier, Russia. Why? Because Germany also has a phobia about the shale-gas revolution that is sweeping the rest of the world. Germany has meager gas reserves, but friendly neighbors like France and Poland now have huge reserves.

If Germans want to avoid shipping the remainder of their industry to China and shivering in the dark when the sun is not shining and the wind is not blowing, they will have to choose between viable sources of electricity: nuclear, natural gas and coal. The smart move for Merkel would be to get full value out of Germany’s existing nuclear power plants during their design life and then consider environmentally friendly gas turbine replacements.

Although nuclear power has many advantages and new reactor designs coming from places like Oregon State University show great promise, natural gas appears to be the most competitive solution for advanced industrialized societies needing clean, reliable power in coming decades. Is Germany still capable of making rational decisions? Very recent news suggests that they may restart one nuclear reactor to avoid power shortages this winter. They are also talking about using millions of euros from a fund for promoting alternate energy to encourage new coal and natural gas power plants. These are steps back from the abyss.


Gordon J. Fulks holds a doctorate in physics from the University of Chicago, Laboratory for Astrophysics and Space Research. He is an Academic Advisor at Cascade Policy Institute in Portland and lives in Corbett.

Renewable Energy Credits: The Ultimate Greenwash

By Nick Sibilla

News Corporation claims it’s greener than Starbucks.

That’s one of many surprising insights gleaned from the first-ever global Corporate Renewable Energy Index (CREX). According to CREX, published by Bloomberg New Energy Finance and Vestas Wind Systems, News Corporation (the parent company of FOX News and The Wall Street Journal) procures 67% of its electricity from renewable energy (RE). That makes News Corp. the 8th highest corporate consumer of renewable energy. Meanwhile, Starbucks ranks below at 14th, with 58% of its energy purchased from green sources. Despite the current recession, among those surveyed, corporate purchases of RE increased by more than 50% over the past year.

Yet many of the corporations on CREX did not actually buy renewable energy. Instead, they purchased a fabricated commodity, known as renewable energy credits (RECs), or “green tags.” A REC represents the alleged “environmental amenities” associated with certain forms of electrical power production such as wind or solar. For those in the trade, one REC is created every time one megawatt-hour (MWh) of renewable energy is generated. (For comparison, the average American household uses just under one MWh every month.)

In other words, two distinct commodities are associated with renewable energy: the electric output itself and the intangible environmental benefits. RECs represent the latter and are sold separately from the power generated by a “green” facility. But by purchasing RECs, corporations can still claim they are using green power. In fact, according to CREX, RECs accounted for over 70% of all corporate green power purchases in 2010.

However, buying RECs is troubling for two reasons. First, the price of RECs is far too low to induce investment in clean energy. As CREX notes, the average price is a little under $1 per REC. But according to exposés published by Bloomberg News and BusinessWeek, the actual cost of generating one new MWh of green power can range anywhere from $40 to over $90 per MWh. In fact, in a study published by the National Renewable Energy Laboratory, the cost of solar power can reach as high as $680 per MWh.

Second, RECs are often a marketing gimmick for corporations to prove they care about the environment. For example, back in 2008, Nike was the 24th-largest corporate buyer of RECs. But that same year, it emitted 1.6 million tons of carbon, one of its highest years in the past decade. One year later, Nike slashed its RECs purchases by almost 70%. Now Newsweek ranks Nike as the 10th Greenest Company in America, as determined by over 700 different metrics. Yet Nike is conspicuously absent on CREX. Meanwhile, News Corp. plummets from #8 on CREX to 107th on Newsweek’s list. Clearly, going green takes much more effort than buying RECs.

Furthermore, for those concerned about global warming, RECs do not reduce total carbon emissions. According to the EPA:

If you are buying renewable electricity or RECs, you are reducing your indirect emissions…An organization buying green power can claim to be reducing its carbon footprint, but cannot claim to be reducing its total emissions to the atmosphere. (Emphasis added.)

Not using fossil fuels may be admirable. But by providing negligible investment for renewable energy, RECs are little more than a waste of other people’s money. As a fabricated commodity, RECs are the ultimate greenwash.


Nick Sibilla is a research associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

“The Boondoggle of Boondoggles”

By Nick Sibilla

Oregon is a pioneer in green power. But we’re also a pioneer in wasting other people’s money. Right now, Oregon is home to one of the largest energy boondoggles in the nation: Shepherds Flat wind farm.

Currently under construction in Gilliam and Morrow counties, Shepherds Flat soon will have the largest wind farm in the world. Since wind power is expensive, Shepherds Flat has received over $1.2 billion in federal, state and local subsidies. Apologists say these subsidies will create jobs. But according to The Oregonian, this wind farm will create only 35 permanent jobs. In other words, each job created will cost American taxpayers over $34 million.

Meanwhile, Caithness Energy, the developer of Shepherds Flat, will bear only 10% of the cost. But Caithness will earn a 30% return on investment. In addition, this wind farm will not even power Oregon. All of the subsidized output will go to Southern California Edison, which provides electricity to places like Orange County. This project is nothing more than a triad of corporate welfare, government subsidies and exorbitantly expensive jobs. So is it any wonder residents in Shepherds Flat are calling this project the “boondoggle of boondoggles?”


Nick Sibilla is a research associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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