Offsetting Carbon Emissions

Offsetting Carbon Emissions - April 7, 2006

April 20, 2006

Thank you for covering the carbon offset approach to reducing global warming pollution.

Unfortunately you weakened your article in the last few paragraphs with typical journalistic balancing. It is this "unbiased" balancing that has deceived the American public for so long about the seriousness of global warming.

It is irresponsible to let this position by Harry Alford stand unchallenged: "There is little evidence that mandatory emissions caps actually work"

Think about it - anytime a mandated reduction occurs (e.g. a certain technology is employed) the mandate has "worked". The fact that we are not achieving the Kyoto goals cannot be attributed to that aspect of the solution. We would never have flown to the moon if we had needed evidence of success before starting to work on it.

And when you say in closing that "uncertainty exists about how and when climate change will occur" you have succumbed to lazy journalism. That is patent nonsense, and I think as a student of energy matters you know that. (It has already occurred.)

Other than those quibbles, I do enjoy your column and thoughtful contributions to this broad subject.

Warren Shoemaker
Oregon City, Oregon

I was a consultant to the administration in the development of the Clean Air Act Amendments (CAAA) of 1990 that adopted a cap and trade program for power plant emission reductions. My project was to compare and contrast the cap and trade approach with the alternatives.

As a result of my early involvement, I have been an interested observer in what happened to the 1990 CAAA cap and trade program. My opinion is that the success of the 1990 CAAA cap and trade program resulted from a number of factors that coalesced at the time that the CAAA program went into effect. Many utilities had coal contracts whose escalation clauses resulted in high-priced coal. The Powder River Basin was coming on strong; it had excess capacity and low priced coal. Rail consolidation greatly expanded utilities' ability to obtain low sulfur coal, particularly Powder River Basin coal, at lower cost than what they had been burning.

As the existing high-cost coal contracts expired, many utilities were able to switch to lower sulfur coal at significant savings. Some utilities still had to install scrubbers, but the appearance was that the CAAA's cap and trade program enabled emissions to be reduced at low costs. The cap and trade program did not, in and of itself, result in these low costs for emissions reductions, but the cap and trade approach facilitated the use of coal switching, PRB coal, and rail consolidation as low-cost ways of achieving emissions reductions.

As a result of the CAAA experience, the cap and trade approach has had "magical" qualities attributed to it. The rhetoric seems to be that it is only necessary for a cap and trade approach to be used, and it will not cost much to achieve emissions reductions. I don't see this working with carbon emissions. Where are the Powder River Basins and the railroad consolidations of carbon emissions? I am not saying that something does not need to be done about global warming or carbon emissions. I am saying that without low cost ways of significantly reducing carbon emissions, neither cap and trade nor any other approach is going to be able to magically reduce carbon emissions at low cost or without significant impacts on the economy.

Chris Neil

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