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Wednesday, July 3, 2024

Decarbonization Mandates: Aspirational Pledges are Harmless but Mandates and Bans May Not Be

 

     In the U.S. about 82.5% of energy consumed comes from fossil fuels. Another 8.7% comes from nuclear. That makes 91.2 %. The rest, 8.8%, comes from renewables. Of those renewables, about two-thirds comes from biofuels, wood, and waste, which are not clean energy sources, with the exception of renewable diesel. That only leaves a little over 3% of our primary energy sourced from wind and solar. Even if we increase wind and solar ten-fold, we would only be sourcing 30% of our energy from wind and solar. These cold hard facts are not difficult to understand. When we have climate scientists saying we must reduce and eliminate fossil fuels they are obviously not being realistic. The reality is simply that we can’t. Another solution meant to speed up the energy transition is to enact bans and mandates. These are not likely to be well-received. Nobody wants to be told they have to buy a more expensive and less reliable EV. Many people and businesses do not want to give up their gas stoves.

     Biden administration mandates include EV mandates and an ambitious schedule to reduce carbon emissions from the power grid that can be considered to be a mandate. With the new SCOTUS ruling knocking down the precedent of the ‘Chevron Doctrine’ it will be harder to enact and justify such regulatory pushes. The big issue is not decarbonization but the speed of decarbonization.  

     More recently, EVs are suffering from declining sales and other serious issues such as dysfunctional charging stations and significantly reduced cold weather driving range. Thus, the new trend of mandates phasing out ICE vehicles seems to be short-sighted and bound for problems. In August 2022, California started the trend by announcing that they will ban sales of new gasoline and diesel-powered cars by 2035. Now, California does have some particular air pollution issues particular to the region such as weather inversions that make vehicular pollution more of a public health problem. 11 other states have either enacted similar bans, lesser bans, or are considering similar bans. These are, as expected, in liberal-leaning states. People tend not to like bans unless they solve an immediate problem. At some point, maybe before 2035, EVs may have longer ranges, perform better in cold weather, have sufficient functional charging infrastructure, and cost less. If that does not happen, there will be serious problems and backtracking. I think it is not in the interests of anyone to enact such bans now. Mandating the way to an accelerated energy transition is clearly in my mind not going to work. In fact, I think it is counterproductive. It invites pushback. Inviting pushback has been the bane of the liberal agenda and it strengthens opposition against that agenda.

     I think it’s great that the Biden administration was able to push through its record incentivization to decarbonize energy with the Bipartisan Infrastructure Act and the ill-named Inflation Reduction Act. These are carrots. It’s the sticks, the mandates and bans, that are problematic. Voluntary emissions reductions measures are easier to implement than compliance-based emissions reductions. The mandates are simply not needed. We can surely influence markets a bit with the incentive carrots, but the sticks are not useful, not needed, and often cause more harm than good. Nobody likes to be forced. Nobody likes mandates that will make their personal costs rise.

     It’s fine to have aspirational pledges. Notions like net zero by 2050 pledges are aspirational. We may not make it there, but we will likely move much closer to it than we are now. We need to be practical and prioritize to solve the most immediate world problems first. If oil plateaus and peaks around 2030 or so, if natural gas replaces more coal, if solar continues to boom, if carbon capture and sequestration can be done at scale without cost overruns and operational issues, if new energy sources like hydrogen and geothermal are better developed, if we can produce enough energy transition minerals and materials cost-effectively, and if EVs actually become competitive in both price and performance, then we have a chance of net zero by 2050 or at least something close. That is a lot of ‘ifs’.

     My advice to liberal politicians and climate campaigners is simply to stop with the bans and mandates. They are punitive actions. They are not needed. They are not popular, even with liberal constituents.

 

 

References:

12 States Are Banning the Sale of Gas-Powered Cars. Zainab Noor. June 30, 2024. 12 States Are Banning the Sale of Gas-Powered Cars (msn.com)

 

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