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Carbon tax whiplash
There was a burst of Beltway chatter about carbon taxes yesterday afternoon. If you missed it, here's what happened:
- First it looked, surprisingly, like the White House might kind of, sort of be considering a carbon tax. Sean Spicer, asked about the topic, said broadly that there's a "robust debate going on with respect to tax reform." So . . . he's saying there's a chance!
- But then, a few hours later, the White House closed the door on the idea. "The Trump administration is not considering a carbon tax," an official said.
Why it matters: The (briefly) muddled signs on carbon taxes are part of a larger uncertainty about where exactly Trump will land on climate change. Yes, he's very gung-ho about dismantling EPA rules and other domestic climate policies. But the White House has given mixed signals about whether the U.S. will abandon the Paris climate accord, and whether Trump still flatly disputes climate science.
Notes from the shale oil surge
Oil majors are getting very serious: Bloomberg nicely lays out how the most powerful companies are "jumping into American shale with gusto" with a surge of new investments.
- Exxon, Shell and Chevron plan to spend $10 billion combined this year.
- Costs are falling: Shell says it makes money in the Permian when oil is at $40 per barrel, and new wells are profitable at $20.
- The price collapse a couple years ago has refocused the majors' strategy on lower costs and projects that bring in cash quickly.
Marathon Oil expands Permian foothold: The big independent company is spending $700 million to snap up acreage on the New Mexico side of the Permian basin, where production is booming.
, in an analysis saying two forces are converging that shale is booming while mega-projects from the industry's big capital spending days of 2011-2013 are coming online. The result could be oversupply in the next couple years.
Happening today: The Senate Environment and Public Works Committee will probably approve bipartisan legislation that aims to bolster the Nuclear Regulatory Commission's ability to license next-wave nuclear reactor technologies.
- Something to watch: whether GOP leadership shows any appetite for bringing it to the floor, or whether it instead gets pulled into the "could become part of comprehensive energy legislation" quicksand.
The Breakthrough Institute is out with a new report titled, "How to Make Nuclear Innovative: Lessons From Other Advanced Industries." Their bottom line about this languishing industry:
- It's time to tilt the playing field away from legacy companies toward "smaller, more entrepreneurial startups."
- Shifts in other industries — like airlines, pharma, spaceflight and fracking — offer good lessons.
- They have recommendations! Such as: Creating a "staged" NRC process that accommodates new and evolving designs and that's more financially friendly for small firms trying to license their tech; significant R&D funding and better collaboration between national labs and industry.
Climate policy vets battle with their pens
Sometimes I read things so you don't have to.
From the left: Democratic uber-operative John Podesta, the force behind lots of Obama climate policies, has a new piece on climate activism in the Trump era. Some takeaways from his Center for American Progress essay:
- A number of states and cities have robust programs that help form an "alternate path for climate action."
- Polling consistently shows backing for carbon-cutting policies.
- Falling renewables costs and growing deployment mean that green energy gains under Obama can withstand short-term policy changes.
- 2017 governors races in Virginia and New Jersey could be a referendum on Trump's environmental policies.
From the right: Oren Cass of the Manhattan Institute, a top adviser to Mitt Romney's 2012 run, argues in Foreign Affairs that while human-induced climate change is real, the level of despair and freakout is way out of sync with what's projected about the severity and economic impact.
- Cass, calling for pragmatism, argues "catastrophism" brings bad behavior and policy in its wake. "It has produced calls for the investigation and prosecution of dissenters and disregard for constitutional limitations on government power."
Coal’s global slowdown
The amount of coal-fired power under development worldwide took a sharp downturn in 2016, according to a new data from several green groups, owing mostly to coal-hungry China and India hitting the brakes.
Here are some top-line findings:
- Pre-construction activity is down by half, and there's a 62 percent drop in construction starts. Ongoing construction is down by about a fifth.
- Construction is "frozen" at over 100 sites in China and India, and there has been a surge in coal plant retirements in Europe and the U.S.
Why it matters: The groups — CoalSwarm, the Sierra Club and Greenpeace — say the the shrinking global coal pipeline puts the goal of holding global warming to 2°C above pre-industrial levels "within feasible reach."
- But that said, several things would need to keep breaking against coal for that to happen. Among them: meeting that target "would require much faster retirement of existing capacity, particularly in the world's historic emitters," the groups note.