Cooler Heads Digest 24 July 2015


24 July 2015

In the News

100% Renewables?
Thomas Stacey II, Master Resource, 24 July 2015

EPA’s Climate Action Flimflam Report, Part 2
Marlo Lewis,, 23 July 2015

Obama’s Scorched-Earth Oil and Gas Policy
Robert Bradley, Jr., Real Clear Energy, 22 July 2015

Let’s Have Full Disclosure on Harvard’s New Health Study
Steve Heins, Fortnightly, 22 July 2015

A Vote for the PTC Is a Vote for EPA’s Climate Regulation
Thomas Pyle, The Hill, 22 July 2015

Britain Moves To Slash Renewable Subsidy Costs
Susanna Twidale, Reuters, 22 July 2015

Commutes Could Get Worse under EPA’s Ozone Rules
John Siciliano, Washington Examiner, 22 July 2015

Nonsensical “Fractivist” Pipeline Hysteria
Mark Perry, Washington Times, 21 July 2015

Innovation Sputters in Battle against Climate Change
Eduardo Porter, New York Times, 21 July 2015

North Dakota’s Oil Economy Remains Strong Despite Media Myths
James Taylor, Forbes, 20 July 2015

Senior Cardinal Questions Pope’s Authority on Climate Change
Steve Doughty, Daily Mail, 20 July 2015

News You Can Use
Study: Removing Oil & Gas Export Hurdles Would Create 2.3 Million New Jobs

According to a new study by economic consulting firm Wood Mackenzie, Congress would create as many as 2.3 million new jobs by removing the oil export ban by 2016 and streamlining approval of liquefied natural gas export terminals.

Inside the Beltway
William Yeatman

House and Senate Committees Introduce Underwhelming Energy Bills

This week witnessed the introduction of energy policy bills in both chambers of Congress. The House Energy and Commerce Committee on Monday dropped a 92 page as-yet-unnamed bill, while the Senate Energy and Natural Resources Committee on Thursday unveiled the 370 page Energy Policy Modernization Act of 2015. Both bills are underwhelming.

Out of more than 100 sections in the Senate bill, only two are any good, and they would streamline permitting for liquefied natural gas exporting facilities and hydropower dams (respectively). The worst section of the Senate bill affirms the purpose of the Strategic Petroleum Reserve (SPR), a federally maintained oil repository meant to guard against a major supply disruption, despite the fact that the American oil boom has rendered the SPR obsolete. The rest of the Senate bill is fluff, syuch as a sense of Congress supporting geothermal energy, research into methane hydrates as an energy source, and the codification of individual dam permits.

The unnamed House bill similarly includes only two welcome provisions: §1101 would speed the permitting of natural gas pipeline construction and §1102 would give the Federal Energy Regulatory Commission enhanced flexibility if EPA’s war on coal threatens electric reliability. The worst provision of the House bill is a boondoggle in the form of a federally-managed “strategic reserve” for large transmission transformers, whose ostensible purpose is to guard against the possibility of a solar storm. The rest of the bill is more fluff, like the creation of an “energy security” plan for North America.

Thus, the newly-introduced House and Senate energy bills are large collections of policies that are disparate, uncontroversial, and minor. Moreover, for each draft statute, the bad outweighs the good (though the total mass is small, thankfully).

At heart, serious (and seriously beneficial) congressional energy policy must be a function of regulatory reform, rather than the creation of new and insignificant programs. On this front—serious energy policy—there was some good news this week from Capitol Hill. Yesterday, by a robustly bipartisan 258-166 vote, the House passed H.R. 1734, the Improving Coal Combustion Residuals Regulation Act, an excellent bill that would rein in EPA’s recent coal ash regulation. And in the Senate, Energy and Natural Resources Chairwoman Lisa Murkowski (R-Alaska) told reporters this week that her panel will take a vote before the August recess on a consolidated bill to lift the existing ban on oil exports.

Wind PTC: Watching Congress Make the Sausage

At the end of 2014, Congress allowed to expire the wind production tax credit (PTC), the wind energy's most lucrative subsidy.

However, the wind PTC remained a priority for legislators from wind-heavy states and environmentalists. During the 114th Congress, these wind energy proponents have been pressing to include the wind PTC in a bill, known as the “tax extenders package,” comprised of dozens of other tax subsidies. Unfortunately, this “package” of preferential tax treatments represents the apogee of congressional comity—it enjoys overwhelming bipartisan support because everyone gets to eat from the taxpayer trough. Regardless whether Democrats or Republicans are in charge, most Members of Congress agree that the tax extenders package is good parochial politics, alas.

On Wednesday, the Senate Finance Committee took up the tax extenders package. So as not to rock the boat, and thereby jeopardize everyone’s goodies, the Committee leadership gave way to wind energy proponents, and included the wind PTC in the draft legislation. By a depressingly bipartisan 23-3 vote, the Senate Finance Committee approved the package. All of the democrats on the committee voted for the bill, and a preponderance of republicans voted for it. The principled few to oppose the tax extenders package—Sens. Dan Coats (R-Ind.), Mike Enzi (R-Wyo.) and Pat Toomey (R-Pa.)—won my respect.

Science Update
Marlo Lewis

House Panel Examines Administration’s Social Cost of Carbon Analysis

The House Resources Committee this week held a hearing on the Obama administration’s social cost of carbon (SCC) estimates. The SCC is a guesstimate of the damage allegedly inflicted on society by an incremental ton of carbon dioxide (CO2) emissions over an immense span of time – typically out to the year 2300.

Discernible in neither meteorological nor economic data, carbon's social cost exists in the virtual world of “integrated assessment models” (IAMs) – computer programs that combine speculative climatology with speculative economics.

Under President Obama, agencies routinely incorporate SCC estimates in cost-benefit analyses used to justify regulatory proposals. Agencies have an incentive to invent and inflate SCC values to make CO2-reducing regulations look more valuable.

For example, the administration’s 2013 technical support document (TSD) on the social cost of carbon increased the SCC values of an earlier 2010 TSD by roughly 60%. In just four short years, while climate models increasingly overshot observed global temperatures, and multiple datasets continued to provide no evidence of a greenhouse "signal" in the frequency or strength of extreme weather, climate change somehow got 60% worse and CO2-reductions 60% more valuable. Your government at work!

Four witnesses testified at the hearing. For reasons of space, I will cover only two key points in the testimony of Cato Institute scientist Patrick Michaels.

A critical input in SCC calculations is climate sensitivity, an estimate of how much warming results from a doubling of atmospheric CO2 concentration. Both the 2013 TSD and the administration’s July 2015 response to comments reaffirm the IPCC 2007 Fourth Assessment Report's (AR4) "best" climate sensitivity estimate of 3°C.

Some 14 recent studies and 20 experiments estimate lower sensitivities, averaging about 2°C. Plugging that value into the administration's IAMs would reduce SCC values by 35%-60%.

More importantly, using an updated sensitivity estimate would significantly reduce the apparent risk of high-impact, low-probability events such as collapse of the Greenland ice sheet. Michaels faults the administration for refusing to recognize “what is now becoming mainstream science.”

Worse, the administration’s analysis is systemically biased. Literally thousands of empirical observations demonstrate that rising CO2 concentrations increase crop yields. Yet DICE and PAGE, two of the three IAMs on which the administration relies, have no CO2 fertilization benefit.

Although one IAM, the FUND model, has a CO2 fertilization effect, it is about four times smaller than the benefit identified in a recent comprehensive assessment by Craig Idso. If all three IAMs incorporated Idso’s CO2 fertilization benefit, SCC values would have been very low or even “negative” (i.e. a net benefit).

Models that lack CO2 fertilization -- a "known physical effect" -- are inherently biased. And that, Michaels reasonably concludes, should "disqualify them from contributing to the final result."


The Cooler Heads Digest is the weekly e-mail publication of the Cooler Heads Coalition. For the latest news and commentary, check out the Coalition’s website,