Who steers the climate acton course, government or private businesses?
by Allen Best
The discussion, however, was a bit like the way that Mark Twain was supposed to have described the South Platte River as it leaves Colorado: a mile wide and an inch deep.
The sharpest disagreement, even if superficially argued, was between Shaun McGrath, a former mayor of Boulder who is now regional administrator of the Environmental Protection Agency, and Kathleen Sgamma, vice president of government & public affairs for the Western Energy Alliance.
Their essential difference was what role government has to play. Sgamma pointed out that U.S. greenhouse gas emission have fallen to the lowest levels since 1994 – most importantly because of the switching from coal to natural gas for production of electricity. This, she said, was a private-sector initiative, the result of new innovations in technology, including horizontal drilling and hydrofracturing.
“It is a huge success story, and it wasn’t because of government intervention. It was because of good, old-fashioned market forces,” she said.
Nowhere in the Obama climate action plan “does it point to what was responsible for this reduction,” she said.
Top-down, centralized approaches don’t work, she went on to say. She cited the case of Germany, which she said has actually increased emissions of greenhouse gases, despite its subsidies for renewables.
Asked how she foresees future strides in reductions of greenhouse gases, she said she sees continued development of natural gas but also nuclear, as well as research and development into future technologies that are scalable, meaning they can be made big very quickly.
Solar is not included and, if I heard right, she found wind wanting – despite the fact it has managed to meet more than half of electrical load in chunks of Colorado during early morning hours, a low-demand time.
McGrath took issue with Sgamma’s explanation. He described government policies playing a significant role in the shift away from fossil fuels, most prominently through the renewable portfolio standards, but also federal and state tax credits.
Xcel Energy, Colorado’s largest electrical supplier, is now poised to deliver 30 percent of its electricity from wind, solar and other renewables by 2030. In addition, it is also shifting two coal-fired power plants to natural gas, the result of state legislative action working with the company.
Obama’s plan allows delivers framework for conversation while allowing flexibility for different strategies, he said.
A third panelist, Amelia Peterson, senior research associate, Governors’ Climate & Forests Task Force, University of Colorado Law School Research Faculty, also argued that focusing on international accords, such as the Kyoto Agreement, have failed. She also ventured that federal action is less important than state actions, and she cited California’s cap-and-trade system. She also credited the private sector. “A lot of the innovation comes from industry itself,” she said.
The forum format was frustrating in that each speaker had little time. But even when there were opportunities, I heard too little substance. Instead, there were bullet-point platitudes.
For example, McGrath pointed to carbon capture and sequestration as a major feature of the Obama plan. When I asked him for elaboration, his answer was empty, at least in my ears. I suspect it was the Obama administration’s “all of the above” energy approach that sounds good but doesn’t mean much.
And as for Sgamma’s argument that the United States succeeded where Germany had failed because of private-sector innovation – it was, perhaps, even a flatter argument. Colorado Gov. John Hickenlooper commonly makes the point that the great success of fracking is at least partly due to the $8 billion in federal research funding. You need not look very far to see the federal government as a key partner in advancing research and development in any number of technological sectors.
As for Germany, it’s true that the greenhouse gas emissions have increased. But why? After the Fukushima disaster, German Chancellor Angela Merkel made the decision to shutter her country’s nuclear power plants. In replacement, coal-fired boilers were cranked up. Coal, there, is so much cheaper than natural gas. It’s a complex story, not a simple one of failure of renewables. Indeed, I have heard no evidence whatsoever that the enterprise to create a stronger foundation of renewable energy has failed.
But what is the role of government? Afterward, I confided to another attendee, a state legislator, my belief that a stronger U.S.-China relationship must be forged, to help address climate instability.
He brought up the pollution that, when he arrived in Denver in 1972, was far, far worse than it is now. “You couldn’t see more than two blocks,” he said.
I can remember some of that smog, although I lived in Fort Collins then. My father, though, once commented on how the smog drifted won the South Platte Valley, even shrouded the river as it flowed past Fort Morgan.
What solved the problem?” I asked the former state senator, Miller Hudson.
“The catalytic converter,” he answered.
And what produced catalytic converters?
“Government regulation,” he answered.
From the earliest days of Colorado, government has always played an invaluable role in protecting of the shared environment. Our earlier water laws were an example of that. By the 1880s, wild-game hunters were rapidly causing the depletion of elk and other big-game species to deliver meet to Leadville and the other mining towns. This was the private sector exploiting the commons to the point of extirpation. Private businesses didn’t regulate this. It took government.
More recently, in the 1960s, it had become clear that we were mucking up our creeks and rivers, some even becoming flammable, because of the gunk poured into them. It took the Clean Water Act, the Clean Air Act and other legislative measures to protect the public environment.
Can the private market fix the climate problem? Technological innovation must be part of the answer, and the private sector provides that imaginative energy, but it will take government incentives and regulations to step up the pace. History is very clear on this matter.