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The Center for Climate and Energy Solutions seeks to inform the design and implementation of federal policies that will significantly reduce greenhouse gas emissions. Drawing from its extensive peer-reviewed published works, in-house policy analyses, and tracking of current legislative proposals, the Center provides research, analysis, and recommendations to policymakers in Congress and the Executive Branch. Read More
 

There's growing business momentum for climate action

Can you feel the momentum?

With negotiators meeting in Bonn this week and only six weeks to go until Paris, the business community is not only stepping up to the plate, but is swinging for the fences on its support climate action (Yes, it’s playoff season, so baseball is also on my mind).

This week’s announcement that 69 companies have joined the White House’s American Business Act on Climate Pledge brings the total to 81. Many of these companies pledging to reduce their emissions, take other actions to tackle climate change and support a strong international agreement include a number of members of our own Business Environmental Leadership Council: Alcoa, Bank of America, GE, General Motors, HP, IBM, Intel and PG&E. Together the 81 companies represent a combined $3 trillion in revenue and 9 million employees.

And last week, 14 companies with a combined revenue of $1.1 trillion and 1.5 million employees signed a statement organized by C2ES in support of a Paris climate agreement, that began “Paris presents a critical opportunity to strengthen efforts globally addressing the causes and consequences of climate change, and to demonstrate action by businesses and other non-state actors. ”

But these companies aren’t just talking about climate change; they’re doing something about it. They’re making commitments to reduce their own emissions, and some are even committing to use 100% renewable energy through the RE100 campaign.  They are also working both internally and with communities and cities to increase climate resilience.

Now it’s time to take this enthusiasm and put it to work. We know there is growing support for a strong agreement in Paris, and hopefully that’s what we’ll get in December.  But that’s just the first step—we’ll need to ensure that countries live up to their commitments, and back here in the United States, we’ll be working with businesses, states, and cities to build partnerships that harness the power of the markets to reduce emissions, develop innovative financing for clean energy and strengthen our resilience to climate impacts.

We have some real momentum going now. Let’s make the most of it.

New commitments to reduce HFCs show leadership

The fastest growing family of greenhouse gases – extremely potent hydrofluorocarbons (HFCs) -- aren’t going to be growing as fast in the future.

Today’s White House announcement of voluntary industry commitments to reduce hydrofluorocarbons (HFCs), along with new regulations put in place over the past year, have created game-changing shifts toward more environmentally friendly alternatives.

Developed as substitutes for ozone-depleting chlorofluorocarbons (CFCs) in the late 1980s, HFCs have become widely used worldwide in refrigerators, air conditioners, foam products, and aerosols. While they don’t contribute to ozone depletion, HFCs can trap 1,000 times or more heat in the atmosphere compared to carbon dioxide. This means they have a high global warming potential (GWP).

The amount of these compounds produced around the world has been growing at a rate of more than 10 percent per year. Unless controlled, emissions of HFCs could nearly triple in the U.S. by 2030. Strong international action to reduce HFCs could reduce temperature increases by 0.5 degrees Celsius by the end of the century, a critical contribution to global efforts to limit climate change.

The 16 voluntary industry commitments that make up today’s announcement highlight the innovation and leadership U.S. industry is showing in meeting the challenges of addressing climate change. These actions build on 22 commitments made by industry at a White House event just a year ago.

Clean Power Plan Timeline

Clean Power Plan Timeline

February 2016

Download the Timeline (PDF)

On February 9, 2016, the U.S. Supreme Court issued an order staying the Clean Power Plan while litigation proceeds on the legal merits of the rule. No deadlines or other compliance obligations may be enforced while the stay is in effect.

The Clean Power Plan provides guidelines for the development, submittal, and implementation of state plans. States can submit their plans or request a two-year extension by September 6, 2016. States must submit complete plans by September 6, 2018.

While the compliance period for the rule starts in 2022, states can opt to participate in the Clean Energy Incentive Program (CEIP). CEIP seeks to reward early investments in renewable energy and energy efciency measures that generate carbon-free electricity or reduce end-use energy demand during 2020 and/or 2021.

The performance rates are phased in over the 2022–2029 interim period, which leads to a “step down” reduction path. States may elect to set their own goals for the three interim periods as long as they meet their interim and nal goals. States must also demonstrate they have met their interim goal, on average, over the eight-year interim period.

Starting in July 2032 and every two years afterwards, states are required to demonstrate how they met the nal goal.


 

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Bob Perciasepe's statement on the U.S.-China joint statement on climate change

Statement of Bob Perciasepe
President, Center for Climate and Energy Solutions


September 25, 2015

On today's U.S.-China joint statement on climate change:


The United States and China today advanced the global climate effort on two fronts – by committing to strengthen their national efforts to curb emissions, and by breaking ground on key elements of a new global accord.

In setting a start date for its national emissions trading system, China sends a powerful signal that market-based strategies will play a critical role in the transition to a low-carbon future. In the U.S., states have the opportunity to employ similar cost-effective approaches to cut emissions from power plants under the new Clean Power Plan.

Beyond their respective national efforts, the two leaders helped pave the way for a meaningful agreement in Paris by offering a shared vision for moving beyond the historic developed-developing country divide.

These new understandings can help deliver an agreement that ensures accountability and works to build ambition over time. And by committing $3 billion to help other developing countries, China is assuming shared responsibility for mobilizing critical climate finance.

Many issues remain and the United States and China cannot achieve a global accord alone. But the growing alignment of the world’s two largest economies and emitters bodes well for a successful outcome in Paris.

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Contact: Laura Rehrmann, rehrmannl@c2es.org or 703-516-0621

About C2ES: The Center for Climate and Energy Solutions (C2ES) is an independent, nonprofit, nonpartisan organization promoting strong policy and action to address our climate and energy challenges. Learn more at www.c2es.org.

How states can best promote clean power

The federal Clean Power Plan gives each state the flexibility to use its own ideas on how best to reduce greenhouse gases from the power sector. One proven, cost-effective approach is to use market forces to drive innovation and efficiency.

It worked before to curb acid rain. It’s working now in California and the nine states in the Regional Greenhouse Gas Initiative. And it can work again with the Clean Power Plan.

The options available to states go beyond creating or joining a cap-and-trade program or instituting a carbon tax. Pieces can be put in place, such as common definitions, measurement and verification processes, so that states or companies could be in a position to trade within their state or across borders. Modest programs that allow companies to trade carbon credits could be explored.

In an op-ed published in The Hill, Anthony Earley, CEO of California energy company PG&E, and C2ES President Bob Perciasepe urge states to give these options serious thought.

 

Read The Hill op-ed.

Q&A: EPA's Federal Implementation Plan

Q&A: EPA's Federal Implementation Plan

On August 3, 2015 as part of the Clean Power Plan release, the Environmental Protection Agency (EPA) issued a proposed federal plan. The agency is currently soliciting comments on the proposal and intends to issue a final federal plan by summer 2016.

What is a federal implementation plan and when is it used?

The Clean Air Act offer states the opportunity to implement national pollution control programs, including the Clean Power Plan. There is every reason for a state to develop its own plan that takes into account its own unique circumstances, and most states choose to develop and implement programs based on that knowledge. Most states are likely to develop their own program to comply with the Clean Power Plan.

EPA assists state efforts by providing technical and policy guidance. EPA must also review and approve state plans to ensure that they comply with the Act. If a state fails to adopt and implement an adequate plan, EPA is required to issue and enforce a federal implementation plan. States may also choose to adopt the federal plan as an alternative to developing their own plan. However, if a federal plan is implemented in a state, the state may still, at a later date submit a plan to replace the federal plan either in whole or in part. States may take over the administrative and enforcement aspects of a federal plan rather than leaving it to EPA.

What is included in the federal plan?

EPA is proposing two federal plans with different approaches – a rate-based approach and a mass-based approach. These two federal plans can be enforced in states that fail to adopt or implement an adequate plan. These two federal plans may also be considered as model rules which states can adopt or tailor for implementation as a state plan.

How does the federal plan encourage market-based solutions?

The federal plans offers two market-based programs to achieve cost-effective emissions reductions. These may be adopted in part or in whole by states or used as a model for states to design their own plans.

In the rate-based program, units must meet an emission standard or acquire a sufficient number of emission rate credits (ERCs), each representing a zero-emitting megawatt-hour, to bring their rate of emissions into compliance. ERCs can be generated by units not covered directly by this rule, and they can be bought, sold, or banked for later years.

For a mass-based program, EPA would create a state emissions budget equal to the total tons of CO2 allowed to be emitted by the affected units in each state, consistent with the state targets. EPA would initially distribute the allowances within each state budget – less three proposed allowance set-asides – to the affected units based on their historical generation. Allowances may then be transferred, bought, sold, or banked for future use. The compliance obligation on each of the affected unit is to surrender the number of allowances sufficient to cover the unit’s respective emissions at the end of a given compliance period.

The federal plan will also facilitate interstate trading as well as international trading with Canadian and Mexican units that are connected to U.S. electric grid. EPA intends to set up and administer a program to track trading programs – both rate-based and mass-based – that will be available for all states that choose it. EPA proposes that affected units in any state covered by a federal plan could trade compliance instruments with affected units in any other state covered by a federal plan or a state plan meeting the conditions for linkage to the federal plan.

Proper evaluation, measurement, and verification procedures are important to ensure emissions reductions are actually achieved in a trading program. EPA must approve any such procedures and has also offered model procedures to verify that any credits in a state-based trading regime are compliant with federal requirements. States may choose to incorporate these procedures into the state plan to assure approval by EPA.

Will states be penalized for using the federal plan?

No. States will not be penalized for using all or part of a federal plan. The stringency of the proposed federal plan for each state will be the same as required if states were to write their own plan.

 

EPA's Clean Power Plan puts states in the driver's seat

The finalization today of EPA’s Clean Power Plan offers Americans a clear, realistic roadmap for addressing planet-warming emissions that threaten the environment and the U.S. economy.

Most importantly, it puts states in the driver’s seat to devise innovative strategies to reduce emissions efficiently and cost-effectively. Now it's time for states to work together with businesses and cities to craft the approaches that work best for them.

Climate change is a critical challenge, and the impacts will only grow more costly if we fail to act. Last year was the warmest on Earth since we started keeping records over a century ago. During the first half of this year, it got even hotter. Climate change impacts include more extreme heat, which can exacerbate drought and wildfires, more frequent and intense downpours that can lead to destructive floods, and rising sea levels that threaten coastal cities.

Many cities, states, and companies recognize climate risks. And many are taking steps to reduce greenhouse gas emissions.

New federal standards are already reducing heat-trapping emissions from the second-biggest source, transportation, by increasing the fuel economy of cars and trucks. The Clean Power Plan takes the next logical step by addressing the largest source: the electric power sector, responsible for nearly 40 percent of U.S. carbon dioxide emissions.

Bob Perciasepe's Statement on Clean Power Plan

Statement of Bob Perciasepe
President, Center for Climate and Energy Solutions

August 2, 2015

On the release Monday of the final Clean Power Plan to reduce U.S. power plant emissions.

The administration is doing what science and the law demand, and it’s now up to the states. The smart ones will see this as an opportunity, not a threat – a chance to modernize their economies and energy infrastructure.

I know from my conversations with state leaders and utility CEOs that even those who may openly oppose the rules are thinking hard about how to meet them. And many are very interested in the types of incentive and market-based approaches EPA is encouraging. It behooves every state to sit down with stakeholders – mayors, consumers, businesses – and craft a plan that fits it best. States should take advantage of the opportunity to innovate and make their economies stronger and more sustainable.

The final plan will give states the time needed to craft strong plans and achieve interim targets, provide incentives to increase renewable power and help low-income communities improve energy efficiency, and encourage cost-effective, market-based approaches to reducing emissions.

Many states and businesses are already taking action and demonstrating leadership. Years from now I’m sure we’ll see this as a pivotal moment accelerating the clean energy transition that is already underway.

We’re coming to grips with the rising risks of climate change and laying the foundation for a low-carbon future. The quicker states put their heads together with utilities, businesses, and cities to figure out the smartest approaches, the sooner we’ll get there.

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To talk to a C2ES expert, contact: Laura Rehrmann, rehrmannl@c2es.org or 703-516-0621.

About C2ES: The Center for Climate and Energy Solutions (C2ES) is an independent, nonprofit, nonpartisan organization promoting strong policy and action to address our climate and energy challenges. Learn more at www.c2es.org.

Bob Perciasepe's Statement on Business Act on Climate Pledge

Statement of Bob Perciasepe
President, Center for Climate and Energy Solutions

July 27, 2015

On the White House announcement of business leaders committing to climate action and supporting efforts to reach a global climate agreement in December in Paris.

We applaud the companies that have come forward to pledge action to reduce heat-trapping emissions, increase clean energy investments, improve efficiency, and support efforts to reach a global climate agreement this year in Paris.

Climate change is posing rising environmental, social, economic, and security risks. Delayed action only means greater costs.

Business leaders get it. They see climate risks firsthand -- in damaged facilities, interrupted power and water supplies, disrupted supply and distribution chains, and impacts on their employees’ lives.

And the business community will be essential to mobilizing the technology, investment and innovation needed to transition to a low-carbon economy.      

Several of the companies making pledges today – Alcoa, Bank of America, and General Motors – are members of the C2ES Business Environmental Leadership Council that is committed to climate action.

Although businesses, cities, states and nations are working toward a more sustainable future, it will take a global effort to address a global threat. Paris is our best opportunity to get all the major economies on board a lasting agreement that strengthens the global effort and works to strengthen it over time.

Many nations, including the United States, China, and the European Union, have already announced their goals for reducing greenhouse gases. But the strength of any agreement will rest on the parties’ political will to implement it.

The strong support of business leaders for climate action, like that exhibited today, can only help to strengthen that will.

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To talk to a C2ES expert about business engagement on climate change, contact: Laura Rehrmann, rehrmannl@c2es.org or 703-516-0621

About C2ES: The Center for Climate and Energy Solutions (C2ES) is an independent, nonprofit, nonpartisan organization promoting strong policy and action to address our climate and energy challenges. Learn more at www.c2es.org.

How Canada and the U.S. can lead together on climate change

June 27, 2015
The (Toronto) Globe and Mail
Op-Ed by Janet Peace

With fossil fuel production going strong on both sides of the border, Canada and the United States face similar challenges in balancing energy and economic priorities with the urgent need to reduce climate-altering greenhouse gas emissions.

By sharing solutions, many of which are rising up from the state and provincial level, both countries have the opportunity to not only craft a national approach, but also show real leadership as we work toward a new global climate agreement later this year in Paris.

At one time, governments in both countries sought to contain greenhouse gas emissions by enacting economy-wide cap-and-trade programs. But neither materialized, and the national targets the two have announced ahead of Paris rely heavily on subnational policies.

While U.S. emissions generally have been trending downward, as lower-priced natural gas has displaced coal in power production, steeper reductions require mandatory limits on power plant emissions, as President Barack Obama’s administration has proposed. But implementation of the administration’s Clean Power Plan will fall largely to the states.

In Canada, meanwhile, emissions are rising and oil sands-related emissions could double over the next decade if development continues at projected rates. Similarly, getting a handle on Canadian emissions will be largely a provincial matter – resting heavily, in this case, with the new Alberta government.

One of the great virtues of promoting climate action at the subnational level is that it allows for policy experimentation and innovation. Both countries should draw on these lessons as they move toward economy-wide approaches that can achieve greater emission reductions at lower cost. And they should work to better align their respective efforts.

Here are some specific ideas:

First, as more states and provinces turn to carbon pricing to curb emissions, we should forge stronger links among those systems. Ten U.S. states have carbon trading programs. Others may soon follow suit as they look for promising paths to meet their Clean Power Plan emissions reduction targets.

Quebec’s cap-and-trade program is already linked with California’s, and Ontario will soon join them. British Columbia has a carbon tax and Alberta just announced it is extending its carbon-intensity-based pricing system. By setting a clear timeline for a gradual price rice, Alberta is signalling that the value of taking action will increase over time.

Second, the two countries should co-operate on reducing emissions from growing oil and natural gas production. Mr. Obama’s administration is expected to propose a mix of regulatory and voluntary strategies to reduce methane emissions from the oil and gas sector. It’s essential that the United States and Canada set the right example for other major energy producers around the world.

Third, both should strengthen and more closely co-ordinate efforts to develop and deploy carbon capture and storage (CCS) technologies. Even with dramatic increases in renewable power, the world will continue to rely on coal and natural gas to generate electricity, making CCS key to any plausible strategy to reduce global emissions.

Canada has established itself as a leader with the world’s first commercial-scale, coal-fired power plant with CCS – Boundary Dam in Saskatchewan. The United States is working on its first CCS power plant in Kemper County, Miss. But the first two examples of any new technology are going to be expensive, and we’ll need greater support for CCS to build more commercial scale projects and drive costs down. Alberta has been a strong supporter of CCS. Now is the time to continue and even step up that investment.

Fourth, Canada’s abundant hydro resources can be a boon for both countries. The U.S. and Canadian electricity grids are linked through dozens of connections and more than a dozen states already import a significant amount of Canadian hydro. A recent C2ES study found that importing hydro from even a modestly sized new Canadian project (250 megawatts) could help states reduce power sector emissions. For example, California, Massachusetts and Washington state could each get about a third of the way toward their proposed Clean Power Plan targets.

Canada and the United States are blessed with abundant resources and vibrant economies. Both have the opportunity to show global leadership in dramatically reducing the emissions that are warming our planet and risking our environment and our economies. With the right mix of national and subnational policies, and by working together, the two countries can enjoy strong, sustainable growth while fulfilling the commitments they make in Paris.

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Janet Peace is senior vice-president of policy and business strategy at the Center for Climate and Energy Solutions (C2ES). She is also a member of the Council of Canadian Academies on oil sands environmental technologies.

Read the original article on the Globe and Mail website.

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