Each week, we’ll be compiling the most relevant news stories from diverse sources online, connecting the latest environmental and energy economics research to global current events, real-time public discourse, and policy decisions. Here are some questions we’re asking and addressing with our research chops this week:
How does the shale revolution really impact the environment?
The Council of Economic Advisors (CEA), an agency within the Executive Office of the President, issued a report titled “The Value of U.S. Energy Innovation and Policies Supporting the Shale Revolution,” which coincided with President Trump’s appearance at the ninth annual Shale Insight Conference in Pittsburgh, Pennsylvania. In his speech, President Trump cited statistics from the CEA report, which highlights the purported economic and environmental benefits associated with the shale revolution.
Today in the Common Resources blog, RFF Senior Research Associate Daniel Raimi takes another look at how the shale revolution impacts the environment, as reported by the CEA. Raimi argues that, although the report accurately characterizes recent innovation in the oil and gas sector and the resulting economic benefits experienced by US energy consumers, the CEA’s assertions about shale’s environmental impacts require further inquiry. Raimi breaks down five key points that complicate the assertions the CEA makes on the environmental impacts of the shale revolution. He concludes: “If the CEA wants to support policies that further boost the economic benefits arising from the shale revolution, there is ample evidence to make the case. But the notion that further deregulation of the oil and gas sector could lead to improved environmental outcomes is questionable, at best.”
Related research and commentary:
Credit: American Public Power Association/Unsplash
What role should the California state government play in PG&E’s public safety power shutoffs?
In the wake of massive public safety power shutoffs in California from the utility Pacific Gas & Electric (PG&E), the mayor of San Jose, California, has proposed turning PG&E into the nation's largest cooperative electric utility through a coordinated buyout among California cities and counties. PG&E filed for chapter 11 bankruptcy protection from an estimated $30 billion in wildfire-related liabilities, and has received criticism, notably from Governor Gavin Newsom, for its decisionmaking around its power shutoffs.
This week on Resources Radio, RFF’s weekly podcast, host Daniel Raimi discusses the economic effects of the shutoffs with Judson Boomhower, an assistant professor of economics at the University of California San Diego and a faculty research fellow at the National Bureau of Economic Research. Raimi and Boomhower discuss the economic factors that contributed to the shutoffs, their economic impacts, and how planned shutoffs may become increasingly common in the future. Boomhower offers unique expertise on many facets of the issue, including California’s electricity system, wildfire, and—crucially—the economics of liability.
On the topic of possible roles for government involvement in the shutoffs, Boomhower says: “The thing that seems reasonable to me as an economist is that maybe this is a setting where we should be thinking about a little more direct government regulation. That's not always something you'll hear an economist say―we tend to be a little skeptical of direct regulation, but because of all the complicated incentive problems that exist for the utility … I think it's reasonable to at least think about a model where the public utility commission, or some other government body, actually has a more direct role in deciding when public safety power shutoffs should happen and should not happen.”
Related research and commentary:
Credit: Tada Images/Shutterstock
When will electric vehicles achieve parity with gasoline vehicles?
Last week, Ford announced that it will launch the largest EV charging network in North America in partnership with electric vehicle (EV) charging companies Greenlots and Electrify America. Ford’s EVs have yet to hit the market; its Mustang-inspired EV, which the company claims will have a 370 mile all-electric range, will be unveiled next month. Ford is one of many auto companies scrambling to tap into the EV market as EV technologies quickly evolve.
This week in the Common Resources blog, RFF Fellow Benjamin Leard and Senior Fellow Virginia McConnell track how these technological advances might affect the EV market. Leard and McConnell suggest that in just a few short years, the “range anxiety” produced by the limited driving range of most EVs (100 to 300 miles per charge) might dissipate as new technologies increase driving ranges and reduce costs. Leard and McConnell conclude that “extrapolating the rate of decline [in cost per mile of range] suggests that we could see parity or below in the mid-2020s. Perhaps then, we will enter an age of EV ‘range serenity,’ so that a selling point of EVs is a good price for a good driving range. Until we reach range serenity, however, policies like the $7,500 federal tax credit are necessary to continue giving new vehicle buyers enough incentive to purchase EVs.”
Related research and commentary:
