The United Nations’ (UN) Intergovernmental Panel on Climate Change (IPCC) released their climate change report on Friday that they produce about every five to six years. The IPCC’s last report was published in 2007. The UN created the IPCC to assess the science, risks and impacts of global warming, and the IPCC is considered the world's leading authority on climate change.
A press release from the IPCC says, “It is extremely likely that human influence has been the dominant cause of the observed warming since the mid-20th century. The evidence for this has grown, thanks to more and better observations, an improved understanding of the climate system response and improved climate models.”
“Warming in the climate system is unequivocal and since 1950 many changes have been observed throughout the climate system that are unprecedented over decades to millennia. Each of the last three decades has been successively warmer at the Earth’s surface than any preceding decade since 1850, reports the Summary for Policymakers of the IPCC Working Group I assessment report, Climate Change 2013: the Physical Science Basis, approved on Friday by member governments of the IPCC in Stockholm, Sweden.”
Extremely likely is an upgrade from a previous report that said it was very likely that human intervention was spurring climate change. The IPCC defines extremely likely as 95–100% probability of an outcome or a result, and very likely as 90–100% probability.
The report's authors do not conduct original research for the assessments, so the IPCC reports are primarily summaries of the state of the field. The findings are based on the aggregated results of the most recent published and peer-reviewed climate change research with more than 600 researchers from 32 countries reviewing more than 9,000 peer-reviewed studies for this report. They produced 2,000 pages of scientific analysis and worked through 56,000 comments.
Friday’s report represents the first of four sections that ultimately make up the IPCC's Fifth Assessment Report, or AR5. Other parts of the report examine socioeconomic impacts and potential ways to mitigate the effects of climate change.
US Secretary of State John Kerry responded to the UN report with this statement:
"Those who deny the science or choose excuses over action are playing with fire. Once again, the science grows clearer, the case grows more compelling, and the costs of inaction grow beyond anything that anyone with conscience or common sense should be willing to even contemplate."
The bottom line is alarm bells should be going off as you read about this disturbing report. Each of us influences climate change and it should frighten you that some of its impacts are happening faster than originally expected. We need to do more to correct the problem. This massive and critical report points to long term implications if we do not embrace a sustainable, cleaner energy future posthaste.
For decades, fossil fuel companies have enjoyed the benefit of master limited partnerships (MLPs). A MLP is a business structure that acts like a corporation with its corporate stock trading on the open market, but is taxed as a partnership rather than at the corporate tax rate. This allows investors to buy and sell their shares in the public markets, and project developers to access cheaper capital through the markets. It’s an attractive tax benefit to be a MLP; an advantage that is inaccessible currently to renewable energy investment.
Since the 1980s, Congress has enabled investors to bundle energy projects like oil and gas pipelines and other fossil fuel developments from companies that extract, process or transport “depletable” natural resources and exempted them from corporate income taxes. The word “depletable” specifically excludes renewable energy.
U.S. Senator Chris Coons, a Delaware Democrat, introduced a bill last year that would give wind, solar and other renewable projects the same tax benefit. The Master Limited Partnerships Parity Act was re-introduced this week by a bipartisan group of senators.
In order to effectively combat climate change, renewables need to be priced at, or better yet, lower than fossil fuels. It’s easier to sell shares to individuals and institutional investors such as pension funds when renewable projects are set up as MLPs. Widening the pool of potential investors adds new competition, which could lower the cost of financing projects, and in the end reduce the cost of renewable power.
Is leveling the playing field for wind, solar and other renewable projects the magic bullet to renewable energy investment? No, but it is a step in the right direction. The Master Limited Partnerships Parity Act is actually part of a broader toolkit, one that the federal government has used successfully in the past to develop domestic energy resources. Tax benefits such as the Production Tax Credit and Investment Tax Credit remain essential tools within the renewable energy industry.
Other tax reforms the industry and its supporters say will help level the playing field with fossil fuels include allowing renewable companies to organize as real estate investment trusts (REITs) and letting renewable tax credits be claimed by more types of investors. In December of 2012, a bipartisan group of 29 U.S. lawmakers sent a letter to the President calling for changes to both MLPs and REITs.
Even with bipartisan support in a deeply divided Congress, the bill faces some serious obstacles. A 2011 Congressional Research Service report estimated that extending MLPs to renewable energy companies would cost the U.S. Treasury about $2.8 billion between 2010 and 2014. At the moment, the broad political momentum in Congress involves eliminating loopholes and exemptions in order to raise revenue and lower tax rates. The report suggests that if leveling the playing field is the endgame, the alternative is closing the tax loophole for oil and gas companies.
Personally, I want to stop global warming and move into a sustainable energy future. Let your Congressional Representatives know you want them to support the Master Limited Partnerships Parity Act.
Sometimes the sun doesn’t shine or the wind doesn’t blow, temporarily stalling renewable energy production. When that happens, what fuel source fills in the energy gap? Traditionally the answer was coal, but due to increased supply and low prices, the answer of late has been natural gas. Coal is certainly the dirtier of the two fossil fuels, but natural gas is not a perfect choice either. The increased supply in natural gas was achieved through the process of hydraulic fracturing (called fracking), which can be harmful to the environment.
Last spring natural gas prices fell to all-time lows of $2 to $3 per thousand cubic feet in the United States. This spring natural gas prices are on the rise. In fact, they’ve doubled to just over $4 per thousand cubic feet, but the bottom line is natural gas is still pretty cheap. Experts say prices in the $4 or $5 range won’t affect the increasing use of the fuel by consumers and the energy industry since the price was $8 just a few years ago. In Europe and Asia prices are even higher; think $10 to $14.
According to a Citibank research report, “Gas and renewables could in fact be the making of each other in the short term.” Expect renewables to cost about the same as conventional fuels in many parts of the world “in the very near term.” Mark Brownstein, an associate vice president at the Environmental Defense Fund, noted that the price of renewable energy has declined substantially in recent years, and that’s expected to continue, making them even more competitive. As demand for renewables builds, it will in turn “drive demand for more gas-fired” power plants to be used as backup.
Meanwhile, the Environmental Protection Agency (EPA) missed an April 13 deadline to issue much-anticipated new rules limiting carbon dioxide emissions from new power plants. Proposed a year ago, the rules were first to set limits on greenhouse gas emissions from new plants. Once a limit is set for new facilities, the EPA is legally obligated to address existing plants, which pose the true climate threat at the moment. The US’ power plant fleet is the single biggest source of greenhouse gas emissions in the world. Acting EPA Administrator Bob Perciasepe said last week that the agency expects to propose new rules on greenhouse gases from existing plants in fiscal 2014.
The draft rule for new power plants sets a limit of 1,000 pounds of carbon dioxide per megawatt-hour of electricity. That cutoff point would be easy for natural-gas-fired plants to meet, but not conventional coal plants. Already, power companies build natural gas plants almost exclusively because of the low price of gas.
There is speculation that the EPA’s indefinite delay on the new rules limiting carbon dioxide emissions from new power plants is due to second thoughts at the EPA and the White House over the single standard. The EPA is said to be contemplating setting two standards, one for coal plants and the other for natural gas, which might make the new rule more legally defensible in an attempt to avert the inevitable legal wrangling that goes on whenever the EPA sets a new rule including limitations.
Environmental groups argue that separate standards make little sense. “Setting a separate standard for coal- and natural-gas-fired plants would greatly weaken the standard’s ability to ensure a transition away from building high-carbon electricity-generation sources,” said economist Rachel Cleetus of the Union of Concerned Scientists.
Natural gas may be the interim answer as we build our renewable energy infrastructure and then the backup once we move to a sustainable energy future. For the sake of slowing down climate change, the EPA needs to set the rules on new electricity generation plants posthaste. Then they should tackle existing power plants without delay. Global warming won’t wait.