Tag Archives: environment

My New Gig(s)

It’s been almost a year since the Oracle deal closed, and I’ve been fortunate to work on a lot of interesting projects since then, including the Energy Innovation Tracker, which I’ll write more about soon.

By last fall I was feeling like it was time to settle down somewhere again. I talked to a number of companies; some of the companies were really small, and some were really large. But late in the year I got an offer to work full-time for Applied Minds and their spinoff, TouchTable, and enthusiastically accepted.

For the rest of this post I’ll just answer some of the obvious questions.

Why Applied Minds and TouchTable?

There were two things that attracted me. The first was innovation. I thought a lot over the summer whether I should go be a senior exec somewhere, or I wanted to stay closer to the innovation. I also considered whether I wanted to focus on one thing (like you do at a startup), or have a broader scope.

This job hit the answer to both questions. I still feel like I can innovate, and that there’s some important problems and some potentially lucrative problems around that deserve some attention. But, at the same time, I had a hard time committing to a single problem. AMI and TouchTable offered up a combination of both.

The second thing that attracted me was the opportunity to work with Danny Hillis again. We’d worked closely at Thinking Machines for almost a decade, had stayed in touch since, and I always wanted to work closely with again.

Are you moving to LA?

Nope, we’re staying in Concord, MA. I’ll be out here regularly, but also expect to help both companies out in DC, which is an easy trip for me. I started work on a home office over the summer, and am putting together plans to finish that off now that I know what I’m doing.

Are you going to be working on sustainability?

This is the most frequent question I got over the past year, and my answer has consistently been “I’m always working on sustainability”.

I did look at some CSO type jobs, but I’ll tell you that they are few and far between. I recently told someone that I bet there are fewer full-time corporate sustainability professionals than there are NBA players, and last I checked that was a pretty tough gig to get.

But as we said at Sun, “every job is an eco job”. So I plan on bringing an eco mindset to everything I do, but also am confident there will be some opportunities at AMI to work directly on some eco problems. Furthermore, I’ll still be involved with activities outside of work such as EIT and NEON.

I’ll send more details as I settle in, but having fun so far!

UK Carbon Bait and Switch

David Roberts has an excellent piece at Grist titled “Carbon tax in the U.K.: What does it mean for U.S. debate?”..

Personally I wasn’t surprised. I’ve always believed that there was a mismatch between the idea of a pure cap and trade system and a democratic system of government. Once cap and trade (or any other carbon pricing scheme) fills up the proverbial cookie jar, there’s no way that elected officials will be able to keep their hands out of it.

On the other hand, even as jaded as I am I never dreamt that the UK government would empty the jar this soon!

As David points out, this accomplishes half of the accepted benefit of a price on carbon, which is to tip the economic scales against activities with high emissions, and in favor of limiting those activities or switching to lower-carbon alternatives. What it doesn’t do is use the proceeds to help accelerate alternatives, or to provide support for individuals and companies who are more acutely impacted by the carbon price.

However, if we’re going to accept that as a “better than nothing” policy solution to carbon emissions, then we need to acknowledge our existing energy taxes and subsidies, which fit into this expanded definition. For example, the US average gas tax is $0.456, and the diesel tax is $0.508 (charts and further references are here). Assuming that we continue to support ethanol and biodiesel such that taxes on those are effectively negated (assuming the 6-year old biodiesel tax credit is extended later this year), then these are equal to a $50-$60 per ton carbon tax for a 20mpg car, and $25-$30 per ton for a 40mpg vehicle.

Of course these taxes are counterbalanced by a hodge-podge of fossil-fuel subsidies, so the amounts may be overstated. Just removing those may be, in fact, a de facto increase in the cost of carbon.

So the takeaway is that any serious effort at pricing carbon needs to clean up all of the various taxes, subsidies, incentives, credits, etc that already exist. If we want to deliver a true signal to the markets, we have to take away the existing noise.

BP: Trying to Save the Well?

I got the following note from a friend from my MIT days:

There is a drilled well that, at the seabed, enters a structure that is compromised. That structure cannot be fixed in a timely fashion or at all. Thus eliminate the structure (drag it away, underwater demolition, piecewise removal). Once that is removed, you can create a clean single exit point for the oil/gas. THAT is where you want to apply an engineering solution. Such as, a massive steel spike cylinder with an anchoring mass at the top, lower it in the hole. If you fail, raise it up a little and try again back down. It has to work.

What they are doing now is trying to recover to a state where they start getting oil/gas back out economically relatively quickly. My work has its own blast furnace and can make anything so if the Feds want to say Go there are about 2000 engineers who would volunteer to develop quick fix concepts. Main idea is keep management away and let the engineers fix it, and give us a liability waiver.

These are important points. Two comments:

  1. This idea that BP is trying to take steps that would cap the leak while leaving the well in a state that it can be reopened, is unconscionable if true.

  2. I still believe that its wrong that no one has created a forum for engineers who know how to fix this. The petroleum team at DOE should be running it. Somewhere out there there’s the analog of Richard Feynman following the Challenger disaster, who has the right idea how to fix this. I don’t know of the idea above is correct, but where is the discussion happening of ideas like this?

A Guide to Cap and Trade Legislation

When I first heard of the concept of a Cap and Trade system for reducing pollution, I thought it was one of the most elegant ideas that I’d ever heard. A Cap puts a hard limit on the amount of pollution that will be allowed in a given time period, and permits for that amount of pollution are distributed and traded among the polluters. Polluters that are ahead of the goals can sell their excess permits, and those that are behind have to buy extras. If lots of people fall behind the goal then the demand and price for permits go up, raising the incentive to stay on target.

Having seen a number of proposed and implemented cap and trade systems over the last decade, I’ve come to understand that there are many of different ways to design such a system, and some of the choices more appealing than others. So given the expected release of the Kerrey-Lieberman Bill on Wednesday, I thought it might be useful to outline some of the possible features of a Cap and Trade system so that more people will be able to dissect the new bill and decide for themselves whether they like it.

Notes: 1) the new bill has been rumored to use a straight tax for gasoline, so some of the following may not apply to that part. 2) the new bill may not use the phrase “cap and trade” for a process that sounds like a cap and trade system. If they use different words, then the rest of us will have to decide if its really something different or not.

Cap and Trade is a Market-Based Solution….Sort Of

People often refer to Cap and Trade as “market-based”, but for most implementations that’s only true if you thought that the economy of the USSR was “market-based”. Sure people buy and sell things, but the government can have a very heavy hand in the process, with controls on supply, demand and prices, and the ability to put certain people or organizations in a very advantaged position in the market.

The situation is aided by the fact that there is no true “cost of goods” for a pollution permit, aside from the damage to society, which no one pays for directly. As a result, if the government wants to give someone a free permit, it bears no cost, so doesn’t require a budget line item or pay-go exception. If it wants to manipulate the price, it doesn’t have to worry about net margins or the like. Basically a cap and trade system is free of a key constraint of most markets, removing many of the downsides for market manipulation.

This isn’t, in and of itself, good or bad, but it just means that you need to look closely at the government’s role in the game, and you may see some mechanisms proposed (such as offsets), that are unfamiliar, and require some extra thought.

What is Covered

The very first feature to look at in a Cap and Trade bill is what is covered. While the obvious big hitters are electricity generation and transportation based on fossil fuels, many industrial processes also generate CO2 or other GHGs. The truth is that many activities at home, including breathing and some baking activities also release CO2. So just from a practical perspective, any GHG Cap and Trade system will have to draw the line on what is covered under the system and what is not.

This is an area where nothing really silly has happened in any of the proposals (though regulating methane from cattle does come up every once in awhile), but there may be fairness issues here. For example, if industrial output above 25K tons of CO2 require permits and below 25K don’t, that could make a big difference in particular industries and is worthy of some study.

Summary: look who is covered under the legislation and who is not, and understand what impacts that will have on energy and non-energy industries

Who is Required to Get Permits

Just because you emit GHG from your vehicle doesn’t mean you’re going to be required to get permits. In most cases it will be a large company upstream, the electricity producer in the case of electricity, and someone in the chain of refiners and distributors in the case of transportation fuels (any industrial emissions are typically paid directly by the emitter).

While every day logic would dictate that you don’t want to be the one who has to obtain the permits, there are two reasons why large energy companies might be happy to take on that burden: 1) if you believe that you can pass the full cost of the permits on to your customers (as most do), then the main reason not to do it goes away. But the reality may be even better — if your actual costs for permits are invisible to the market, you can actually pass on a higher cost to your customers than you pay, thus making money on the deal! 2) if you feel like you have good influence in Washington, then being the permit purchaser puts you in a position to bargain with the federal government over free permits, offsets, etc (more on these below).

These are important elements of the case for large energy companies to publicly support some Cap and Trade legislation.

Summary: look at the bills supporters and understand if they are required to get permits. If so, look for advantages they will get from it.

Where Does the Money Go

Most Cap and Trade systems will auction off at least some, and possibly all, of the permits every year. The government will get the revenues, which raises the question of where the money will go. In general there will be tendency to want to give some of it back to the citizens in order to offset the burden of energy price increases, and it is important to fund energy R&D and other GHG reducing programs (more on this in the next post). But this revenue is a windfall for legislators, and can be used for anything.

Summary: look at where the money goes and make sure it is either lowering the impact on energy users or supporting the reduction of GHG emissions through R&D and incentives.

Freebies

Since permits have no cost, its tempting to give some of them away in order to gain support for the legislation. And, as you’d expect, the most likely candidates to receive those will be the largest energy companies (who are, ironically, also the largest polluters).

The danger here is that if the amount of freebies is large, its possible to create a major barrier to smaller, innovative companies without the same political clout as the big entrenched ones. For example, if I’m a small energy company with a lower-emissions solution, I have to buy permits for my emissions and compete against the big old companies with lots of free permits. As a result, its important to look at the free permits and who is getting them, and to consider the effect on the competitive dynamics of the market.

Summary: understand who is getting free permits, and what the competitive implications may be, especially for small companies entering the market.

Offsets

Offsets are an interesting invention. The idea is that if you do something that will reduce GHG emissions, and that is not covered under the typical system, you can turn your emissions savings into an offset permit, and can be granted the right to sell that to a company as a real emissions permit. For example, if I plant a large new forest that will capture CO2 (and hopefully hold onto it), then I may can work through the offsetting process and turn those emissions savings into permits, which I can sell and get the money for.

The rationale behind offsets is that the CO2 savings are equivalent, and that this clever mechanism funnels money to organizations which are helping out, but are outside the Cap and Trade system. Furthermore, some strongly advocate for the use of international offsets, which can be cheaper than domestic ones, and which help funnel money to developing countries who will need financial assistance for their own GHG initiatives, whether reductions or adaptation.

In addition to the organizations that sell the offset permits, the other group that likes this mechanism are the big emitters, since offsets have historically been cheaper than auctioned permits, and foreign offsets have even been cheaper. However, I believe there are three reasons to take a hard look at how offsets are implemented in a cap and trade system. First, offsets systems have, to date, been rife with fraud (here’s one recent example). Second, international offsets can result in large flows of money out of the US economy (see my analysis of foreign offsets in Waxman-Markey). Finally, if there is a limit on offsets per year (and there usually is), then the question is who gets priority to buy these cheap alternatives to auctioned permits.

Summary: offsets will have some champions, but they also have the potential to introduce complexity and risk to the system. As a result, any proposed use of them deserves extra scrutiny.

Market Distortions

One of the little discussed features of GHG Cap and Trade is that it doesn’t affect all energy consumers or technologies the same. Its important to understand this in the context of any given bill so that the resulting market distortions can be accounted for.

The varied impact on energy consumers results from the fact that the carbon content of electricity varies from location to location by over 3 times. For example, using EPA’s eGRID numbers, the amount of GHG per kWH of electricity varies from state to state as follows: CA – 0.54, CT – 0.80, AZ – 1.1, GA – 1.4, MO – 1.8, Utah – 2.1 and DC – 2.4. This is the result of the sources used – hydro, renewables, nuclear and natural gas make the numbers lower, coal and gas make them higher. As a result, someone in Missouri will be paying three times as much of a premium for their gas than someone from California.

On the technology front, the results are either from underlying price and carbon density differences, or from deliberate policy decisions. For example, a $10/ton price on GHG applied evenly to gas and electricity will raise the average price of residential electricity in the US by 8.7%, while it would raise the average price of gas by only 3.0%. Raise the price for GHG to $20 and both numbers double. A policy decision could have the same effect – we could decide to leave gasoline out of the Cap and trade altogether (an option which has been rumored for Kerrey-Lieberman), in which case we’d disadvantage electricity even further.

This isn’t to say whether these decisions are right or wrong, but its important to measure these impacts and consider what effect they have on the broader strategy. For example, the federal government has clearly made electric vehicles a priority, but either of the situations above appear to push in the opposite direction by increasing the cost advantage of gas-powered vehicles.

Summary: pricing of GHG emissions may not affect all locations or technologies the same. It is important to understand potential market distortions that may result from inequitable carbon prices.

Opaque Prices

Finally, many people argue that we need to get a visible price on carbon in order to cause people to make smarter decisions. Unfortunately, many Cap and Trade implementations offer so many ways for companies to get permits that the price reported by carbon markets doesn’t really reflect what the energy companies paid for them (for a more detailed explanation see my earlier post on this subject).

As a result, it is important to look at how companies get their permits, whether the bill contains reporting requirements, and whether you or other consumers of energy (including companies) will have any idea how much you’re really paying for your emissions.

Summary: since energy users don’t buy permits directly, in a complex Cap and Trade system it may be difficult, or even impossible to know the cost of carbon for a given amount of energy. It is important that a Cap and Trade system force this information to be transparent and available.

Conclusion

As you can see, there are many features of Cap and Trade legislation that can be complex, and can have interesting side effects on the overall market. That said, it is also possible to design a simpler system that is more transparent, less prone to fraud and abuse, and less likely to have unpredictable side effects.

When we see new climate legislation it is important to look at each of these features and understand why they are there, who might benefit, and what the consequences of it might be.

(Note: At this point an astute reader may say that I’ve talked a lot about side effects, but not about whether the bill will actually be able to drive down emissions without putting the overall economy at risk. I’ll cover that in a blog post later this week.)

Getting US Business Behind Climate and Energy Legislation

With the upcoming release of the Kerry/Graham/Lieberman energy bill amidst a contentious environment on Capitol Hill, we’re starting to see the big push to get business support for the legislation. The Politico interview with Sen. Graham makes the case explicitly:

“The package represents major victories for the business community, which was virtually shut out of House deliberations on an energy reform bill that passed last year. …. But the partisan atmosphere in Washington could wipe out those gains if the corporate world doesn’t stand behind it, Graham said.”

So the question is, what is their pitch to the corporate world? Ignoring large energy companies for a minute, since it sounds like their needs are being taken care of explicitly in the bill, how is your average company going to benefit from this bill? This is the question they need to have a good answer to when they roll it out next week.

From what I’ve heard they are banking on the idea that this bill is more “business friendly”, but I’m not sure that resonates with your average business. Cap and trade will now be limited to utilities (though it sounds like they’re going to rebrand it) and there’s limits on the EPA. But a vast majority of US companies would not have been governed directly by the House bill, so this won’t be a big sales point, unless there are folks out there who are really worried about what the EPA might do, but, again, unless you’re in the energy business or one of a small number of CO2 producing industries, this probably wasn’t a huge worry.

So based on my experience in the corporate world, here is my advice to the team on how to sell to the US business community:

  1. Don’t dwell on details between the House and Senate bills. If you aren’t in the energy business the two bills won’t look that different – a cap and trade system coupled with long, long lists of energy company and efficiency incentives and programs. Dwelling on the details is not going to be motivational.

  2. Lay out an energy vision and/or strategy. Here’s the key line in the interview:

    “If our country doesn’t get an energy vision and start incentivizing alternative sources of energy, this whole international movement to clean up the planet is going to pass us by, and we’re going to be following China instead of leading China,” he added.

    Great, so what’s the vision? What will our energy landscape look like in 2035? All nuclear? All solar? Half solar, half biofuels? 10% coal, 50% natural gas, 20% wind and 20% nukes? How about transportation? How much can we really get with efficiency long-term? Without this vision its hard to decide whether the bill will drive us toward the vision or not. Maybe the answer is that we’re going to bet on 4 or 5 clean approaches plus nuclear and hope that 3 deliver to give us a majority of clean energy by some date. That’s fine – lets just state what the vision is and how the bill gets us there.

  3. Address the two big business questions. First, business is going to want to understand the potential impact to the economy in the near term. They know this isn’t going to be free, but a lot of companies are just starting to get their feet back under them and they don’t want to turn the clock back twelve or twenty four months. Second, businesses want to understand the long-term benefit. They’ll be pleased with the climate risk reduction, but what will really get their support is a clear message of “cheap, clean energy”. They’d love to hear that there’s a point in the future where the latest Mideast uprising won’t spike their energy prices; a point where they don’t have to factor in annual electricity increases into their budget; a point where they can design energy-using products that will be cheaper to use for their customers than the year before; and that there’s a point in the future where the energy required to run their business isn’t based on some dwindling resource, or environment-scarring process.

All business want these things, and when you combine them with the climate benefits you can generate some excitement for the bill.

Through the climate bill process the energy companies have been front and center in the discussion. That’s important, since they have to help implement our future energy system. But if we want to get the broader business community on board now, we have to step back from the details in those months and months of discussion and deliver a message that has broader appeal.

Sustainability: TNG

The theme of the weekend was the next generation of sustainability leaders. Tom Friedman led off with an excellent op-ed on the 2010 Intel Science Talent Search. Meanwhile, I got a look even farther into the future at the Alcott School Science Fair, here in Concord, MA.

With three kids, I’ve been to my share of elementary school science fairs. They are always fun and the kids seem to have a great time. Over the years the projects have grown in complexity, but I think the parents are doing a good job with their role in the projects. You can usually see their influence, but on the good projects you can see that the students really drove the result.

In addition to the usual array of awesome projects on volcanoes, electric circuits and catapults there was a big increase in sustainability-related projects (pictures below). A few groups, including my daughter’s brownie troop, did nice projects on renewable energy (two wind projects and hyrdo demo!). One student did a cool project on how to clean up oil spills in water, and another tested the air quality in and around the school (their own classroom came out the worst). But my favorite project was a solar-powered scarecrow. He waved his arms and legs when the Sun shined on him!

How do we keep these kids engaged through their K-12 years? What curriculum options do they get to stay excited and engaged in college? Lets keep this going!

Green Education: What We Need

Over the holidays USA Today had an article talking about the sudden rise of green-oriented minor and major programs at universities. According to Paul Rowland, Executive Director of Association for the Advancement of Sustainability in Higher Education, two factors are driving the surge: students want the courses, and employers want the trained students.

When I give talks on our book “Citizen Engineer” at universities this topic always comes up. In specific, we discuss what employers are looking for in these students.

The first point is clear from the article: energy is a “sweet spot”. The examples at Illinois State, MIT and UC Berkeley all centered on energy. For the first time in decades there is a wave of innovation in this sector, and not only in companies that generate energy, but also those that depend on it for their operations or products. We certainly fall into this latter bucket at Sun, and more of our engineering jobs come with a requirement of understanding electrical energy and how our electricity infrastructure works in real life.

The second point relates to general sustainability degrees. While these were barely mentioned in the article, we are starting to see some students come from programs with majors in sustainability, and I hear of many universities considering adding such a degree.

My feeling on this has become pretty clear cut: a minor degree in sustainability is a wonderful idea, a major is not. We need more awareness of environmental needs and solutions in all of our roles in business: our engineers, chemists, lawyers, business people and operations teams. But the key is that these are all highly specialized roles, and the people need to be able to do these first. I want the major to be in these areas, and will highly value a minor in sustainability.

The proof, of course, is in the pudding. At Sun we have no sustainability generalists, and I don’t anticipate that we would ever hire one. In every real-world case we’ve always needed someone with training or experience in a specific expertise.

To sum up, my advice to universities is always the same: energy is a great major or minor, but be careful of majors in general sustainability. Be world class in the things you already do, and layer in sustainability minor to make those folks even more marketable.

Some Data Released in UK

Steve McIntyre reports that “the UK Met Office has released a large tranche of station data, together with code”.

Notes:

  • The Met Office says that this is not a complete set of data, but it is unclear what is missing.
  • This is the processed data – the raw data is claimed to have been deleted.
  • Over at The Air Vent, Jeff Id discusses some of the details.

In my recent discussions (1, 2) of open climate science, I have stressed the importance of understanding licensing terms when discussing specific code or data. In this case there appears to be no license info available for the data (Note: you can not assert a copyright on facts, e.g. raw data, but given that this is processed data it can have a copyright and license. The Met also seems to believe this, as it is their excuse for not releasing other parts of the complete data set).

On the code side, there are two files of perl code which are downloadable from the site (1, 2). The site says:

This code is released under an Open Source licence that is contained as comments in the code. By running the code you indicate your acceptance of the licence.

However, there is no license in the comments of either file. As those of us in software know, there are big differences between open source licenses, so it would be good do know what license they were planning to use.

Judging Goodness

Two different news items recently led me into the same train of thought: we are all increasingly in the business of judging Goodness, and of being so judged. I purposefully capitalized Goodness here, because I mean in it in the highest sense of the word. This probably sounds vague, so let me use the examples to explain.

The first item is from the NYTimes, and discusses the conundrum caused by a proposed solar plant in Nevada. While the plant will produce copious free energy, it will also require over a billion gallons of fresh water a year, or over 20% of the water supply for the valley in which it is to be cited.

This is a classic problem that we’re going to hear more and more about. What are we willing to give up in exchange for cleaner energy? Many types of solar power need water, as shown above. But how much water is too much? How many dead migratory birds are too many at a potential wind farm location? How much car safety should we sacrifice for better mileage? How much can the view from the shoreline be impacted by offshore wind farms before it cross the line? There are tons of these questions, there are going to be more, and they are going to get more and more complex.

And you can see why I described this as judging Goodness. We might try to reduce these to financial terms, but its hard to put a price on scenic beauty or a single bird. And your answer may not be the same as someone else’s. I’ll react differently to a wind farm I can see from my deck than one that’s a thousand miles away in a place I’ll likely never visit.

The second example isn’t about tradeoffs, but about people trying to quantify the Goodness of organizations. You see this all of the time: green rankings of companies, ethical lists of schools, etc. For example, Sun was recently included in the Newsweek green ranking, finishing XX out of YYY. (Note: I’m not singling out the Newsweek ranking – there are dozens of examples I could have used and this just happened to be a recent, well publicized one.)

This, however, is even trickier than the task above. We’re not talking about an either or situation, we’re talking about trying to capture all of the factors that make up the green-ness or ethical-ness of an organization in a single number. And to make matters worse, these organizations often don’t even do the same thing. How do you compare someone who flies planes to a consulting company? A manufacturer to a non-manufacturer? A small school in the north woods to big one in Manhattan?

But as we’ve seen, there’s no shortage of people who feel they are up to the task. They’re willing to make all sorts of generalizations and use a variety of direct and indirect data. For example, one of the three major factors in the Newsweek ranking was perception audit they did of the public and other “experts”. Since Sun Microsystems is not a consumer brand and we don’t advertise much, its not hard to predict that we may not score as high in that as organizations that are household names, or are use big ad budgets to tout their sustainability. Sure enough, Wal-mart tops the list in that category, and we score well below our larger, better-known competitors. (BTW, Wal-mart is doing some outstanding sustainability work, but that doesn’t validate the scoring methodology.)

Don’t get me wrong, I’m not saying that Sun deserves to be scored or ranked higher. In fact, I’ll go a step further and say that I have no moral grounds on which to judge the ethics or greenness of any organization, Sun included. I’m confident in telling you that we’re using less fresh water and emitting less GHG than we were a year ago, but that’s as far as I’m comfortable going. In short, who am I to judge?

And don’t let me imply that there’s no value in these rankings. Many of them embody methodical and thoughtful fact gathering, and to the extent that they make the underlying data available, you may be able to gather useful information to inform your own decisions. For example, if your organization has decided to stress water conservation, you may be able to get some good data on the relative water intensity of some companies you were considering as partners.

In closing, I think there’s a few important points to take away from this discussion:

  1. It’s important to identify when a judgement of Goodness is taking place and to recognize it as such.
  2. Any judgement of Goodness embodies a certain morality, and the morality others would employ may not match your own.
  3. If you are trying to make a specific judgement of Goodness, then you may be able to tap into a growing set of real data that’s available on organizations.

Trip Report: A Visit to the Capitol

This was written for my Sun blog and cross-posted here

Last week I was down in DC with a group of investors and business execs, many of whom were in the green space under the banner wecanlead.org, a collaboration between Ceres and the Clean Economy Network. John Doerr was the headliner of the group, but there were CEOs of some hot company like A123 and Seventh Generation. The motivation for us all to be there was to impress upon our legislators that well-constructed, comprehensive legislation could be good for business.

(Aside: one of the dangers of these events is that the “well-constructed” part of the message is ignored or left to be defined by the audience, so the message can be interpreted as “pass anything!”. My experience with business folks who are savvy about climate policy is that they are fairly particular about what “well-constructed” means. Another risk is that the press and others will try to figure out what your profit motive is, and often zero in on one part of your group, such as happened here. So whenever agree to participate in one of these missions you have to think through risks like this.)

Overall we were well received, and the trip garnered good press attention. In particular, the executive branch pulled out all of the stops, allocating time from three Department Secretaries: Sec’y Salazar (Interior), Sec’y Chu (Energy) and Sec’y Locke (Commerce). We also heard from Carol Browner, Director of the White House Office of Energy and Climate Change Policy, and several other members of the administration.

With all of these meetings we were able to get a sense of the administration’s overall mood and approach to climate change legislation. These impressions were probably slanted somewhat by the fact that the administration knew it had a favorable audience. The good news was that, overall these folks all knew their stuff. Obviously Sec’y Chu is deep into the science side of energy and Director Browner into policy, but Sec’ys Salazar and Locke both exhibited a deep knowledge and personal passion on environmental issues.

Compared to past trips to DC, the biggest change for me was a new focus on clean energy competition with China. Particularly Sec’y Locke and Director Browner emphasized China above all other reasons to get legislation done, and done soon. Personally I think this is a good change. I believe it can get more broad-based support, and will focus the discussion more on innovation. However, if China truly takes center stage as the driver for legislation, it can’t help but change the focus on the individual elements of the package. In particular, is cap and trade a central mechanism in a competitive agenda as opposed to a climate change agenda? This will be interesting to watch.

Beyond the emergence of China as a motivator, there were some other notes of interest:

  • The administration isn’t waiting for climate legislation to get started. They discussed what they were doing with stimulus money and within the jurisdictions of their own departments. Earlier in the week the President had signed an executive order to drive the greening the federal government.
  • The message on timing for climate legislation is “as soon as possible”. But it was pretty clear that a climate bill is second fiddle to health care, and everyone was very careful to avoid making commitments about Copenhagen. Carol Browner was particularly careful with her words, and I was left with the sense was they’re willing to let the timetable slide past December if the higher priorities aren’t complete yet.
  • Nuclear is back on the agenda. Sec’ys Locke and Chu both talked about an increase in US nuclear capability in a manner that assumes its a done deal. There was none of the hedging about the usual concerns, no hint of upcoming deliberation, etc. There will be more nukes.
  • Public lands will be used for renewables. Similar to the discussion on nukes, Sec’y Salazar spoke with a confident certainty about opening up public lands for renewables, including solar in the southwest and wind farms on the continental shelf off of the Carolinas. Again, not even a nod to the expected concerns.

Finally, when one talks about “comprehensive climate policy”, the scope of what we heard in DC and what’s in the proposed legislation is certainly comprehensive in the sense that there are lots and lots of programs there. But listening to two days of discussions it is still very hard to see how the decarbonization math adds up in order to meet the goals that people are proposing. As someone commented “it’s a mosaic, but there’s no picture”.

I remain particularly concerned about the lack of an R&D plan to support the innovation that is required to meet these goals. Lots of faith is being put into “the market” and the effects of a cap and trade system, but so far that faith eludes me.