Each week, we’re 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 is satellite data being used to improve our understanding of environmental risks?
This week, the New York Times publicized alarming findings from a satellite designed to monitor the globe for methane leaks. While a natural gas disaster at a facility in rural Ohio last year garnered little attention at the time, new satellite data shows that the site released more methane than many oil-dependent nations during the entire year. The satellite data suggests both that the methane leak was one of the largest in American history and that other significant leaks could go unnoticed for years. Proponents of natural gas argue that its combustion produces lower carbon emissions than burning coal; however, methane is a significantly more potent greenhouse gas than carbon dioxide. If methane leaks at natural gas sites are more frequent and more substantial than we currently know, then the environmental dangers posed by natural gas production might require more scrutiny. These new findings also underscore the potential value of satellites in assessing environmental health and informing energy policy.
As scientists continue to find innovative applications of satellite data, researchers at Resources for the Future (RFF) are making key contributions through the VALUABLES Consortium, a partnership between NASA and RFF that aims to use satellite information to inform environmental policy decisions and protect public health. A recently published video explains how RFF researchers are quantifying the socioeconomic benefits of satellite data using an “Impact Assessment Framework.” As the video illustrates, one important outcome from the project has been the effective detection of Harmful Algal Blooms (HABs) and an improved ability to shield communities from serious health risks. The consortium quantified the economic benefits of related satellite data, which allowed decisionmakers to divert the public away from contaminated waters. Read more about how the VALUABLES Consortium is harnessing evidence from satellites for society’s benefit at RFF and in Resources magazine.
Related research and commentary:
As the government begins phasing out tax credits for renewable energy, what are other strategies for expanding the renewable energy market?
The House of Representatives passed a year-end spending bill on Tuesday, which brought discouraging news for clean energy providers. In previous years, tax credits for wind and solar power have garnered bipartisan support—a rarity for climate policy that has a near-term impact on reducing US emissions. Though the wind and solar industries both mounted strong lobbying campaigns to extend their tax credits, the wind energy industry will have just one more year to maintain its current credit on projects that break ground before January 1, 2021—an extension from the current law, which requires projects to break ground by January 1, 2020 to qualify. Meanwhile, the solar industry lost out on what was viewed as its last chance to evade a planned reduction in its tax credit, and the reduction will also take effect in the new year. House Democrats said that a tentative bipartisan agreement had been reached, and included some of the clean energy provisions the industry had been hoping for, but the provisions were pulled from the final bill in an effort to avert a government shutdown when the White House objected.
The forthcoming tax credit reductions raise questions about how the wind and solar industries will adapt, as consumers’ cost concerns might complicate the expansion of low-carbon technologies. In a new issue brief, Kathryne Cleary and Karen Palmer offer one possible strategy: the energy-as-a-service (EaaS) model. EaaS is a business model that enables customers to pay for an energy service without having to make any up-front capital investment. EaaS models usually take the form of a subscription for electrical devices owned by a service company or management of energy usage to deliver the desired energy service—for example, residential customers can pay their electric utility for a solar energy subscription. Cleary and Palmer suggest that the EaaS model could be an effective means of addressing the energy efficiency gap and expanding access to renewable energy. Learn more about how EaaS could boost usage of low-carbon technologies in their issue brief.
Related research and commentary:
How can the world structure emissions trading policies to be economically sound and environmentally beneficial?
Despite lasting two days longer than planned to allow for more negotiation, COP25 ended in disappointment for many this week, as countries again failed to agree on global rules for carbon emissions trading. Article 6 of the Paris Agreement allows for the formation of a global emissions trading system, wherein countries that reduce their emissions can sell credits to countries that fail to level out at their nationally determined contributions. The question of how to actually structure such a system has befuddled negotiators for years; countries like Brazil have contended that they should be able to carry over credits they earned under the Kyoto Protocol, a proposal that most of the world regards as an unjustifiable loophole. Still, experts caution that the current lack of a global emissions trading mechanism hardly portends failure for the Paris Agreement more broadly, as national and regional frameworks can fill the void left by the United Nations. Most prominently, the European Union (EU), which operates the world’s largest emissions trading system, committed itself to net-zero emissions by 2050 and formally linked its carbon market with Switzerland’s at the culmination of the conference.
This week, RFF released “The Legal and Economic Case for an Auction Reserve Price in the EU Emissions Trading System,” a working paper cowritten by RFF Senior Fellows Carolyn Fischer and Dallas Burtraw. The paper provides an overview of the EU’s emissions trading system, analyzes the effectiveness of historical policy adjustments, and offers evidence that supports the introduction of a minimum carbon price to stabilize the market. As part of RFF’s Carbon Pricing Initiative, the working paper is one in a collection of reports and explainers released by RFF that investigate the mechanics and viability of various carbon pricing frameworks. Read the working paper to learn about how a global emissions trading system functions and to understand the context behind some of the biggest news from the COP25 conference.
Related research and commentary:
- Working Paper: The Legal and Economic Case for an Auction Reserve Price in the EU Emissions Trading System
- Explainer: Carbon Pricing 101
- Interactive tool: Carbon Pricing Calculator