eco:nomics: creating environmental capital

by jeffrey ball

one thing is certain in the race for a cleaner energy system: nothing is going to be certain for quite a long time.

energy secretary steven chu explains to wsj’s robert thomson why it takes so long to approve loans and take other steps needed to move policy toward next-generation energy.

in washington last week, the obama administration abandoned the long-running plan to bury nuclear waste below nevada’s yucca mountain, another potential barrier to new nuclear power plants in the u.s. big questions loom about the viability of electric cars and of futuristic power plants that would shoot their greenhouse-gas emissions underground instead of skyward. and concerns about unintended environmental consequences are thwarting plans for wind and solar farms from wyoming to the mojave desert.

don’t expect clarity from the government, the financial world or even the scientific lab, said the chief executives and entrepreneurs who gathered last week at eco:nomics, the wall street journal’s third annual conference on the business of the environment. but, they advised each other, don’t dally in trying to dominate the new energy market, because the spoils will go to those who exploit the uncertainty the best.

when the journal held the first eco:nomics conference, in march 2008, things seemed clearer. oil prices were high, investors were showering money on renewable-energy developers, and federal lawmakers were pushing to limit emissions of carbon dioxide and other greenhouse gases. the intergovernmental panel on climate change recently had won the nobel peace prize for a report concluding that global warming was “unequivocal” and was “very likely” caused by human activity, so the debate over climate science appeared largely done.

all that has changed. oil prices, though rising again, are just above half their mid-2008 highs. tough economic times are pinching clean-energy investment and prompting new opposition to a mandatory carbon cap. and the ipcc has said it will appoint an independent committee to investigate questions raised recently about its widely watched climate-science reports

“it’s frustrating, but scientists are human beings,” energy secretary steven chu said at the conference. society has produced “a greenhouse-gas layer that is absolutely, positively due to humans,” he said, but the precise impacts remain unclear. “the uncertainties are quite large.”

the uncertainties about what technologies might slash greenhouse-gas emissions remain just as big.

consider just the race for an alternative to the petroleum-powered car. peter voser, ceo of royal dutch shell, predicted that by 2050 electric cars might account for 40% of autos worldwide. t. boone pickens, oilman-turned-energy reformer, said the government should subsidize big trucks that burn natural gas. and craig venter, a self-described “life designer,” is trying to make fuel from newly created organisms that consume co2.

each of these options could become a disruptive technology—something that really rocks the world. it will take years to know. the action playing out amid this uncertainty is today’s real energy shift.

write to jeffrey ball at jeffrey.ball@wsj.com

those who were sitting in the comfort of central-air-conditioned rooms and accusing developing countries of not doing enough to fight climate change, might have forgotten the fact that 1.6 billion people in the world still have no access to electricity and 2.3 billion people have to burn coal or wood to keep warm or for cooking.

“developed countries account for 80 percent of the total global carbon dioxide emissions since the industrial revolution over 200 years ago,” premier wen said at the copenhagen climate change summit on december 18.

developing countries, however, only started industrialization a few decades ago and many of their people still live in abject poverty today.

thus, it is totally unjustified for those developed countries to ask developing nations to undertake emission reduction targets beyond their due obligations and capabilities in disregard of their historical responsibilities, per capita emissions and different levels of development.

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what do you think? china is now the biggest emitter of carbon dioxide, but the us far surpasses china’s historical emissions. who needs to act? leave your comments below.

across the country, trial lawyers and green pressure groups—if that’s not redundant—are teaming up to sue electric utilities for carbon emissions under “nuisance” laws. a group of 12 gulf coast residents whose homes were damaged by katrina are suing 33 energy companies for greenhouse gas emissions that allegedly contributed to the global warming that allegedly made the hurricane worse. connecticut attorney general richard blumenthal and seven state ag allies plus new york city are suing american electric power and other utilities for a host of supposed eco-maladies. a native village in alaska is suing exxon and 23 oil and energy companies for coastal erosion.

what unites these cases is the creativity of their legal chain of causation and their naked attempts at political intimidation. “my hope is that the court case will provide a powerful incentive for polluters to be reasonable and come to the table and seek affordable and reasonable reductions,” mr. blumenthal told the trade publication carbon control news. “we’re trying to compel measures that will stem global warming regardless of what happens in the legislature.”

mull over that one for a moment. mr. blumenthal isn’t suing to right a wrong. he admits that he’s suing to coerce a change in policy no matter what the public’s elected representatives choose…the nuisance suits ask the courts to make such fundamentally political decisions themselves, with judges substituting their views for those of the elected branches…in other words, the courts would become a venue for a carbon war of all against all. not only might businesses sue to shackle their competitors—could we sue the new york times for deforestation?—but judges would decide the remedies against specific defendants. in practice this would mean ad hoc command-and-control regulation against any industries that happen to catch the green lobby’s eye.

carbon litigation without legislation is one more way to harm the economy, and the rule of law.

on the pages of today’s washington post opinion section, mann takes on an op-ed by sarah palin that appeared in the same section just a few weeks ago. on dec 9, she argued that while alaska’s climate is changing, the “thawing permafrost and retreating sea ice” is a part of “natural, cyclical environmental trends.” she cites the controversy over the hacked emails from the climate research unit at the university of east anglia as proof of her claim.

is there consensus within the scientific community on climate change or has this controversy over these emails been overblown? tell us what you think in the comments below.

micheal mann, “e-mail furor doesn’t alter evidence for climate change”

i cannot condone some things that colleagues of mine wrote or requested in the e-mails recently stolen from a climate research unit at a british university. but the messages do not undermine the scientific case that human-caused climate change is real.

the hacked e-mails have been mined for words and phrases that can be distorted to misrepresent what the scientists were discussing. in a dec. 9 op-ed, former alaska governor sarah palin argued that “the e-mails reveal that leading climate ‘experts’ . . . manipulated data to ‘hide the decline’ in global temperatures.” yet the e-mail she cites was written in 1999, just after the warmest year ever recorded (1998) to that date. it could not possibly have referred to the claim that global temperatures have declined over this decade — a claim that is false (the current decade, as has been recently reported, will go down as the warmest on record).

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sarah palin, “sarah palin on the politicization of the copenhagen climate conference”

with the publication of damaging e-mails from a climate research center in britain, the radical environmental movement appears to face a tipping point. the revelation of appalling actions by so-called climate change experts allows the american public to finally understand the concerns so many of us have articulated on this issue.

“climate-gate,” as the e-mails and other documents from the climate research unit at the university of east anglia have become known, exposes a highly politicized scientific circle — the same circle whose work underlies efforts at the copenhagen climate change conference. the agenda-driven policies being pushed in copenhagen won’t change the weather, but they would change our economy for the worse.

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