Lomborg and Haab on light bulbs and technology

Lynne Kiesling

Thanks to Tim Haab for pointing us to this excellent observation from Bjorn Lomborg about innovation, regulation, and environmental quality:

Real reductions in carbon emissions will occur only when better technology makes it worthwhile for individuals and businesses to change their behavior. CFLs and other advances can take us part of the way, but there are massive technological hurdles to overcome before fossil fuels generally become less attractive than greener alternatives. …

Limiting access to the ‘wrong’ light bulbs or patio heaters, ultimately, is not the right path. We will only solve global warming by ensuring that alternative technologies are better than our current options. Then, people the world over will choose to use them.

Hear, hear.

Learn Liberty: Tragedy of the Commons

Lynne Kiesling

Here’s another great video from Learn Liberty: Sean Mulholland introducing the “tragedy of the commons”, which, as he accurately notes, is more accurately called the problem of open access. If you teach a class where you talk about this problem, or want to learn more about this fundamental ill-defined property rights foundation of environmental problems, this video is a good resource.

Coase, legal liability, and pesticide drift

Lynne Kiesling

A ruling last week from Minnesota’s Court of Appeals provides an interesting case study in using common law and legal liability (a la Coase) in an environmental case. As summarized in the St. Cloud Times, the issue at hand is pesticide drift — when pesticide spray on one field is carried over to another field by wind. In the case of an organic farm, such pesticide drift has a significant economic cost, because the organic farmer cannot sell the affected produce, and may even have to take affected acreage out of rotation for several years to clear the pesticide and retain the foundation of the organic attribution (usually defined by law).

Here’s a bit more about the fact pattern:

The Johnsons turned their farm into an organic one in the 1990s to take advantage of the higher prices organic crops and seeds bring at market. They posted signs noting that the farm was organic, created a buffer between their property and neighboring farms and asked the co-op to take precautions to avoid overspraying, according to the Court of Appeals opinion.

But the co-op violated state law four times from 1998-2008 by spraying chemicals that landed on the Johnson’s organic farm, the opinion said. The opinion said that the co-op was cited four times by the Minnesota Department of Agriculture for violating pesticide laws that make it illegal to “apply a pesticide resulting in damage to adjacent property.”

A 2002 overspray led to the Johnsons selling their crops at lower, nonorganic prices and taking the tainted field out of production for three years. In 2005, 2007 and 2008, the overspray led the Johnsons to destroy alfalfa and soybeans and plow under and take out of production for three years parts of their fields, according to the Court of Appeals opinion.

What’s interesting to me about this case is the Johnsons’ use of the common law — they filed a lawsuit claiming nuisance and trespass. The district court found against them, but this appeals ruling negates that and sends it back to the district court:

The Court of Appeals opinion Monday decided that what the co-op did could be considered a trespass because it met the two elements necessary — that the Johnsons had rightful possession of their fields and that the cooperative’s unlawful spraying of the pesticide, causing it to drift onto the Johnsons’ otherwise chemical-free fields, constitutes an unlawful entry.

Looks to me like an application of Coase to the pesticide drift question — clarifying who has legal liability for the consequences of actions when those actions affect others, use of the common law concept of nuisance — with the result that the pesticide sprayer is liable for the costs of the consequences.

In a case like this, with two adjoining plots of land, the identification of the actors and the actions is pretty straightforward, so it’s a textbook low transaction cost case. But what happens if, say, the organic farm is adjacent to three other farms, and the issue is not pesticide drift, but is rather GMO propagation drift? If all four farms plant corn, but three of them plant the same strain of drought-resistant GMO corn, some seed propagation across property boundaries is likely. How do you assign liability with multiple potential actors? Is there a way to avoid such a cost, and if so, who is likely to be the least-cost avoider? Or more interestingly, since the GMO corn is drought resistant, how do you net out the beneficial effects of the need for less irrigation against the cost of the corn not being able to be sold as GMO-free any more?

I think I may have just identified a new case study for my fall environmental class …

Virginia Postrel on light bulbs

Lynne Kiesling

If you have not caught Virginia Postrel in her new columnist gig at Bloomberg View, here’s a good chance, for Virginia’s column today is about U.S. federal light bulb regulation; both Mike and I have written about light bulb technology and the EISA 2007 “performance standard” that is leading to the disappearance of the 100-watt incandescent bulb from the market.

Virginia’s column addresses both the quality/aesthetics issues and the economic flaws of technology mandates, concluding that federal light bulb policy is not an efficient way to reduce electricity use. Instead, in bootlegger-and-baptist fashion:

… the activists offended by the public’s presumed wastefulness took a more direct approach. They joined forces with the big bulb producers, who had an interest in replacing low-margin commodities with high-margin specialty wares, and, with help from Congress and President George W. Bush, banned the bulbs people prefer.

It was an inside job. Neither ordinary consumers nor even organized interior designers had a say. Lawmakers buried the ban in the 300-plus pages of the 2007 energy bill, and very few talked about it in public. It was crony capitalism with a touch of green.

After a thorough discussion of the disappointing quality features of CFLs — poor light quality, lags in starting, shorter-than-advertised life spans (but not enough discussion of the lack of dimmability, which is my primary complaint), Virginia analyzes how this technology mandate fails to allow for consumer autonomy and choice in how to control and manage their own electricity use:

But banning light bulbs is one of the least efficient ways imaginable to attack those problems [air pollution or CO2 emissions]. A lamp using power from a clean source is treated the same as a lamp using power from a dirty source. A ban gives electricity producers no incentive to reduce emissions.

Nor does it allow households to make choices about how best to conserve electricity. A well-designed policy would allow different people to make different tradeoffs among different uses to produce the most happiness (“utility” in econ-speak) for a given amount of power. Maybe I want to burn a lot of incandescent bulbs but dry my clothes outdoors and keep the air conditioner off. Maybe I want to read by warm golden light instead of watching a giant plasma TV.

This. This is a large source of aggravation with regulation more generally, as well as a large source of the unintended consequences that inevitably accompany such regulation. The “government knows best” attitude that drills down too far and does not target the ultimate objective, which is reducing electricity use, both fails to deliver on its goal and is patronizing and condescending in the bargain. That’s a lose-lose policy … for everyone except for those big bulb producers who are the beneficiaries of this legislation.

Hydraulic fracturing panel discussion at AEI

Michael Giberson

Kenneth Green hosted a panel discussion on the environmental consequences of hydraulic fracturing at the American Enterprise Institute. Panelists were: Ron Bailey of Reason Magazine, Mark Brownstein from the Environmental Defense Fund, Timothy Considine from the University of Wyoming, and Amy Mall of the Natural Resources Defense Council.

The video above is just a short sound bite by Ron Bailey, I couldn’t figure out how to embed the full video. Find the full video archived at the AEI website. Readers here who have followed the fracking posts will be familiar with many of the points discussed, but the video offers some sense of which environmental issues are currently seen as important.

The UK’s commitment to carbon reductions?

Lynne Kiesling

I’ll be interested to see how the political, economic, and environmental consequences of this weekend’s new carbon approach in the UK unfolds; according to the Guardian (and the too-much BBC that I listen to):

Cabinet ministers have agreed a far-reaching, legally binding “green deal” that will commit the UK to two decades of drastic cuts in carbon emissions. The package will require sweeping changes to domestic life, transport and business and will place Britain at the forefront of the global battle against climate change.

The deal was hammered out after tense arguments between ministers who had disagreed over whether the ambitious plans to switch to more green energy were affordable. The row had pitted the energy secretary, Chris Huhne, who strongly backed the plans, against the chancellor, George Osborne, and the business secretary, Vince Cable, who were concerned about the cost and potential impact on the economy.

However, after the intervention of David Cameron, Huhne is now expected to tell parliament that agreement has been struck to back the plans in full up to 2027. He will tell MPs that the government will accept the recommendations of the independent Committee on Climate Change for a new carbon budget. The deal puts the UK ahead of any other state in terms of the legal commitments it is making in the battle to curb greenhouse gases.

Not surprisingly, reactions have been strong. Take the Telegraph’s outspoken James Delingpole, for example:

But if what it says is even half way true, then David Cameron has made the most unforgivably damaging decision of his entire political career. It will delay our economic recovery, lay waste the British countryside and cement Cameron’s reputation as a man driven not by principle (as, say, Margaret Thatcher and Winston Churchill were) but by a grubby, son-of-Blair urge to keep clinging on to power at no matter what cost to the country at large.

While I agree that it’s unwise to base expensive policy changes on inconclusive science and on a false belief in our ability to control outcomes in complex systems, that statement does seem a bit hyperbolic.

I think this is happening in the context of some other political machinations, and it may not play out exactly as reported in the Guardian. But since in some ways the UK is a bellwether of carbon policy, this should be interesting to watch — are renewables sufficiently economically and technologically developed to meet demand at prices that customers are willing to pay? Will retailers and customers in the UK be willing to explore/interested in exploring the combination of transactive digital technology and dynamic pricing that may modulate that demand relative to forecasts based on old technologies? Will this lead to the perpetuation of government subsidies of the sort that are currently being debated in the US?

New atmospheric research on contrails

Lynne Kiesling

When I think about climate, greenhouse gases, carbon policy etc., I always worry about the certainty that people (typically politicians) want to attach to models (actually, that statement holds for macroeconomic models too, for the same reasons). The global climate is an incredibly complex system, comprising many individual agents and local systems that interact and lead to non-deterministic outcomes (thus the complexity, at least in part). In trying to understand such complex systems we construct models of their behavior. Even the best models are abstractions from some of the details of reality (as statistician George Box said, all models are wrong but some are useful).

Regarding climate, I’ve thought that the most with respect to clouds, and many different ways that clouds can affect climate. Capturing the effects of clouds in a model is difficult because there are so many variables — height, water vapor, etc. — and clouds have different effects depending on those variables and their interactions.

Thus I read with great interest at Ars Technica today about a new research study published in Nature Reports: Climate Change on the atmospheric effects of airplane contrails. Separate from any effects of the emissions from the combustion of jet fuel, the formation of contrails due to the production of water vapor as a by-product of burning jet fuel may itself contribute to greenhouse effects by increasing water vapor in the troposphere. According to the abstract:

An important but poorly understood component of this forcing is caused by ‘contrail cirrus’—a type of cloud that consist of young line-shaped contrails and the older irregularly shaped contrails that arise from them. Here we use a global climate model that captures the whole life cycle of these man-made clouds to simulate their global coverage, as well as the changes in natural cloudiness that they induce. We show that the radiative forcing associated with contrail cirrus as a whole is about nine times larger than that from line-shaped contrails alone. We also find that contrail cirrus cause a significant decrease in natural cloudiness, which partly offsets their warming effect. Nevertheless, net radiative forcing due to contrail cirrus remains the largest single radiative-forcing component associated with aviation.

While I remain cautious in drawing inferences from models of such complex systems, I think research like this at least gives us some insights into the dynamics of how a local system like cloud formation works; in particular, the “substitution” that occurs with the reduction in natural cirrus formation was something I always wondered about. Worth reading.

Reason on energy: nuclear power and light bulbs

Lynne Kiesling

Two good articles on misguided government intervention and energy policy at Reason recommend themselves. Ron Bailey’s written a really excellent, clear, analysis of improved, safer reactor technology, and argues that the best response to the Fukushima accident is not a ban, but rather is innovation:

One hopeful possibility is that the Japanese crisis will spark the development and deployment of new and even safer nuclear power plants. Already, the Westinghouse division of Toshiba has developed and sold its passively safe AP1000 pressurized water reactor. …

One innovative approach to using nuclear energy to produce electricity safely is to develop thorium reactors. Thorium is a naturally occurring radioactive element, which, unlike certain isotopes of uranium, cannot sustain a nuclear chain reaction. However, thorium can be doped with enough uranium or plutonium to sustain such a reaction. Liquid fluoride thorium reactors (LFTR) have a lot to recommend them with regard to safety. Fueled by a molten mixture of thorium and uranium dissolved in fluoride salts of lithium and beryllium at atmospheric pressure, LFTRs cannot melt down (strictly speaking the fuel is already melted).

Ron accurately, in my view, argues that interventionist government energy policy is part of the reason why such technologies have had such a difficult time coming to market:

The main problem with energy supply systems is that for the last 100 years, governments have insisted on meddling with them, using subsidies, setting rates, and picking technologies. Consequently, entrepreneurs, consumers, and especially policymakers have no idea which power supply technologies actually provide the best balance between cost-effectiveness and safety. In any case, let’s hope that the current nuclear disaster will not substantially add to the terrible woes the Japanese must bear as a result of nature’s fickle cruelty.

Similarly, Jacob Sullum criticizes interventionist government energy policy for imposing the paternalist belief that individuals are not capable of making an intelligent decision about the costs, benefits, and tradeoffs involved in using either incandescent or compact fluorescent light bulbs. CFLs turn on too slowly, don’t work in dimmers, and don’t last long enough to make up for their higher cost … and yet, our government tells us that we have to use them because we are too short-sighted to include the environmental impact of incandescents in our decision-making? We should trust a bureaucracy that has mandated such an immature, inferior technology to make a better decision than we each can individually? Yeah, right.

I agree with Jacob when he concludes

I will be happy to use CFLs if and when their manufacturers get the kinks out, or LED bulbs when they become affordable. But I am not the only one who thinks we’re not there yet, judging from the Energy Department’s estimate that more than 80 percent of residential lights sockets were still occupied by incandescent bulbs last year.

By forcing this transition, the government is ignoring the preferences that most Americans have clearly expressed in the marketplace. Which explains why I cheered when I heard Paul declare: “You busybodies always want to do something to tell us how to live our lives better. Keep it to yourselves.”

New York Times article advances public view of environmental issues surrounding hydrofracking

Michael Giberson

At first it seemed like just another newspaper article on the potential environmental dangers of fracking to produce natural gas from shale, but on second look there is something new in the New York Times article, “Regulation Lax as Gas Wells’ Tainted Water Hits Rivers.” Most such stories, and much of the public’s attention, have been focused on the possibility that a badly drilled well could taint groundwater. The new article reveals that disposal of the produced water recovered during fracking operations is likely the more important environmental concern. While produced water is (generally supposed to be) treated before being returned to waterways, some of the facilities used for treatment may not be capable of providing the services needed.

The web version of the story includes extensive related materials, including interactive maps, spreadsheets filled with data, and perhaps most significantly 1,113 pages of documents with annotations provided by the Times (described as the most significant documents out of more than 30,000 pages the Times reviewed for the project). The documents were collected via open records requests, obtained directly from regulators in the Marcellus shale region, or leaked to the Times by state or federal officials.

No doubt that a badly-drilled or poorly finished well can create problems, but the enviro-hype and associated docudrama film have insisted that this is the biggest problem. Probably not. The industry can reasonably point out that thousands and thousands of hydrofracking wells have been completed and of those many thousands only a handful have been linked to any kind of groundwater issue. In fact, as one of the documents points out, fracking has been used for years in Pennsylvania without a lot of controversy to produce coal-bed methane. The bigger hazards may be in produced waters downstream from drilling operations.

Some of the documents relied upon are several years old, and some reports are preliminary rather than final. There is much more to be learned, including – possibly – that the wastewater disposal problems are not as serious as the story suggested (or, of course, it could be worse).  Clearly, this newspaper article isn’t the end of the story, but it does the service of advancing the public’s understanding of the issue.

UPDATE, March 7: Fracking wastewater not causing radioactivity issues in Pennsylvia rivers

Our next fear: peak rocks?

Lynne Kiesling

Economist and teacher extraordinaire Steve Horwitz has done a great video for Learn Liberty on the question “are we running out of resources?”

We’ve done our share of “peak oil” debunking here over the years, so it won’t surprise you that I find The Onion’s take on the question of running out of resources highly amusing:

Geologists: We may be slowly running out of rocks