ClimateIntel.com

In the Russian Federation, there has been scant attention - if any - to the upcoming UN Climate Meeting. The Russian media and press have been exceedingly focused on the upcoming (December 2, 2007) Russian Duma elections. Nevertheless, the Russian government has paid some attention to climate change issues recently.

President Putin issued a decree on October 21, 2007 entitled “On holding in 2008 in the Russian Federation an International Year of Mother Earth” implementing the UN’s declaration of 2008 as the International Year of Mother Earth.

The Russian Federation’s UN Representative offered the country’s position in the UN climate change debate by statement issued in August of this year. In the Statement, we see two key features that we believe reveal the base of Russia’s position on climate change - (1) the fierce clinging (at least for the near future) to the Kyoto Protocol and (2) a call to avoid creating an apocalyptic mood by dramatizing the issue and instead rely on comprehensive scientific research by leading national and international bodies. (more…)

Last month, the Kansas Department of Health and Environment (KDHE) denied an air quality permit for the proposed $3.6 billion expansion of a coal-fired power plant on grounds the emissions would contribute to global warming. The state’s denial of the permit demonstrates the extent to which concerns about climate change can derail previously routine permit proceedings, without warning or precedent.

KDHE Secretary Roderick Bremby denied the permit - over staff recommendations that the permit be issued - based on an opinion from the Kansas Attorney General indicating that state law authorizes the Secretary to address air contaminants that substantially endanger public health and welfare. Following the denial of the permit, Kansas Governor Kathleen Sebelius released a letter to the “people of Kansas” expressing her support for the decision. Governor Sebelius stated that the power plants would produce 11 million tons of carbon dioxide each year, and the impact of global warming on Kansas could be “devastating.” State lawmakers, concerned with electricity demands in the area, have responded by promising to overturn the decision.

Sunflower Electric Company filed suit in state county and appeals courts on November 16 challenging the denial of the permit on due process protection and statutory grounds. On November 27, the Chief Justice of the Kansas Supreme Court signed an order transferring the cases to the high court; a schedule for briefing and arguing the case has not yet been set.

Akin Gump will host a side event at the 2007 UN Climate Change Conference in Bali, Indonesia, on “The Role of Compliance in Ensuring Environmental Integrity and Market Confidence in Climate Change Regimes.”

Compliance will play a critical role in the success of any post-2012 climate change regime and, in this side event, panelists will discuss the compliance issues faced by States in meeting commitments under a post-Kyoto treaty and in implementing the treaty through national measures.

Date: Tuesday, 4 December 2007
Time: 13:00-15:00
Location: BINGO Room, Grand Hyatt New Conference Center (Upper Level)

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During a meeting for industry groups on Tuesday, Jim Connaughton, Chairman of the Council on Environmental Quality, discussed the U.S. goals for the Bali climate meetings, along with State Department Undersecretary Paula Dobriansky, and other members of President Bush’s negotiation team on climate.

At the September 2007 United Nations High-Level Event on Climate, the U.S. committed to participating in the UN process to advance negotiations. The U.S. believes that a successful outcome of the UN Framework Convention on Climate Change meeting in Bali will be the establishment of a “Bali Roadmap” that will advance formal negotiations on an effective post-2012 framework.
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We are hearing that the energy bill, while close to agreement, still has a few hurdles to cross.

The biggest outstanding issue is what to do with the auto fuel efficiency numbers passed by the Senate, but not included in the House legislation. It seems that negotiators have split the proverbial baby. Rather than take a lower overall number (which had substantial backing in the House), the negotiations have centered on an overall number of 35 miles per gallon, originally proposed by the Senate. The automakers did win a huge concession with an agreement to keep cars and light trucks separate. Also, automakers will be granted credits for flex fuel vehicles; vehicles that get less miles per gallon than conventional autos.

Secondly, it appears likely that there will be no provision for federal-level “renewable portfolio standards” (RPS). Passed by the House, the RPS would have meant difficulties for utilities, especially in southern states where available wind and hydro power is scarce.

Finally, it looks like the chances of including small tax package have increased since initial reports to the contrary. Of course, with pay-as-you-go rules in effect, the Democratic majority might have to be creative to have the tax benefits included in a final package. Still no clarity on what, if anything, will be included, but there is still hope for a Production Tax Credit for 2008.

On November 27, 2007, the State of Washington’s Energy Facility Site Evaluation Council stayed an application for a new “clean coal” power plant by Energy Northwest (a consortium of 20 public utilities in the Northwest United States), citing climate change concerns.

The Council ruled unanimously that the application failed to meet the requirements of a law enacted earlier this year, mandating that all new energy facilities include a Greenhouse Gas Reduction Program (GGRP). The statute requires that electrical generators limit greenhouse gas emissions to specified levels; any emissions above the statutory limit must be captured and sequestered permanently. Energy Northwest’s application did not contain any specific plans for emissions capture, so the Council ordered that the application process be halted until Energy Northwest offers a suitable GGRP.

Automakers and dealers challenged California’s 2004 rules mandating emissions standards for new cars stricter than those required under federal law. Citing the Clean Air Act and the Energy Policy and Conservation Act, the plaintiffs argued that federal emissions regulations preempted the California regulations. Central Valley Chrysler-Jeep v. Witherspoon.

The Clean Air Act authorizes California to seek a waiver from EPA to create its own regulations. Plaintiffs argued, however, that Energy Policy and Conservation Act preempts a state agency from regulating fuel efficiency because any regulation requiring reduction in tailpipe carbon dioxide emissions is equivalent to the regulation of fuel efficiency. Accordingly, plaintiffs claimed, Energy Policy and Conservation Act effectively trumped the waiver provisions of the Clean Air Act.

In January 2007, the district court stayed the case and enjoined implementation of California’s regulations pending the Supreme Court’s decision in Massachusetts v. EPA. The parties briefed that issue in July 2007. California moved to dismiss the suit based on the results of the Massachusetts v. EPA decision, arguing that the remaining issues in the case are moot. The plaintiffs argue that the California rules would cause severe impacts and are still pre-empted by federal law.

Oral arguments on the motion to dismiss were heard on November 19, 2007, and a decision is expected shortly.

Next month in Bali, countries will start what are sure to be tough negotiations over how to mitigate and adapt to climate change after commitments under the Kyoto Protocol expire in 2012.

With China’s greenhouse gas output soaring, many Western politicians want Beijing to spell out its goals for limiting emissions growth — something developing countries (or “non-Annex 1″ countries, including China) are not obliged to do under Kyoto.

Visiting Chinese Premier Wen Jiabao expounded on China’s climate change policy in Singapore on November 21, 2007, stating that China is ready to join world efforts in tackling climate change within the framework of the U.N. Framework Convention on Climate Change in accordance with the principle of “common but differentiated responsibility.”

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The Sierra Club is challenging EPA’s issuance of a permit for a waste-coal-fired generating unit at a power plant in Utah that did not establish Best Available Control Technology (BACT) emissions limits for CO₂. In re Deseret Power Electric Cooperative (EAB Appeal No. PSD 07-03, Oct. 1, 2007).

Sierra Club asserts that because the Supreme Court has determined that CO₂ is an “air pollutant” under the Clean Air Act (CAA), EPA is obligated to establish BACT for CO₂ emissions in the permit. EPA responded that while the Supreme Court’s decision Massachusetts v. EPA confirmed that CO₂ is a “pollutant” under the CAA, it is not yet a pollutant “subject to regulation” for which BACT is required. EPA indicated that it would determine in the future whether CO₂ endangers public health or welfare, which would be the first step in EPA’s regulation of the pollutant. If EPA delays too long, however, the courts may answer the question for the agency.

The Environmental Appeals Board granted review of the permit decision on November 21, 2007.

The final policy summary of the science on climate change finds that warming of the climate system is unequivocal, and that there is a 90% certainty that most observed increases in globally-averaged temperatures are due to increases in anthropogenic greenhouse gas concentrations.

Released on November 16 in Valencia, Spain, the Summary Report for Policymakers of the Fourth Assessment of the Intergovernmental Panel on Climate Change analyzes the best available scientific, social, and economic data and makes an incontrovertible case for immediate, decisive action to reduce greenhouse gas emissions.

The report’s strong language describing the adverse effects of climate change on natural and human systems is expected to:

• Shape the international policy discussion during climate talks in Bali, Indonesia, next month, as parties prepare to develop a roadmap for a successor agreement to the Kyoto Protocol, which expires in 2012;

• Increase international pressure for regulatory action from the U.S. and China; and

• Raise potential issues for executives, investors, companies, and fund managers regarding the business implications of climate change.