With Congressional Inertia, President’s Scientific Advisors Offer Proposals for Addressing Climate Change

By Andrew Shaw

On March 22^nd, the President’s Council of Advisors on Science and Technology (“Council”) released recommendations on how the Administration can address climate change in President Obama’s second term. The Council suggested that a carbon tax or cap-and-trade system would be a preferable policy for reducing greenhouse gas (“GHG”) emissions, but acknowledged that existing political realities will make passage of these policies difficult.

That same day, a Senate vote underscored the political resistance to carbon taxes as the Senate rejected a proposal by Senator Sheldon Whitehouse (D-RI) that would have imposed a tax on GHG emissions. Given the current political context, the Council’s report provides some interesting recommendations on climate mitigation and adaptation policies.

The Council argued that transitioning from coal to natural gas in the electricity sector will be important in achieving short- to middle-term GHG emission reductions. The Council’s recommendation builds upon a report last year from the U.S. Energy Information Administration, which found that energy-related GHG emissions in the first quarter of 2012 were at their lowest level since 1992 due in part to the transition from coal to natural gas in the electricity sector.

The Council states that the importance of increased shale gas usage in the electricity sector will be predicated on ensuring minimal methane leakage. Though not mentioned in the report, it is worth noting that EPA last year promulgated new Clean Air Act standards for the oil and gas sector. While not directly regulating methane, EPA estimates that a co-benefit of its rule addressing VOC and air toxic emissions will be reductions in methane. In particular, EPA estimates that the rule, when fully implemented, will reduce 1.0 to 1.7 million short tons of methane annually.

In addition, the Council recommends the creation of a National Commission on Climate Preparedness (“Commission”) to be lead by the Department of Homeland Security.

In the wake of Hurricane Sandy, it is important for federal, state, and local government officials, along with private stakeholders, to coordinate on planning, preparing, and responding effectively to extreme weather events. The Council proposes that this Commission examine changes to Federal policies on disaster relief and insurance to ensure that incentives are not encouraging risky development, particularly in the aftermath of a natural disaster. While Congress recently implemented some reforms of the National Flood Insurance Program, a review of policies is warranted in order to bolster the program’s financial viability and to promote sustainable development.

Finally, the Council recommends that the U.S. exert additional leadership internationally on climate change. One interesting recommendation by the Council is a potential North American climate agreement.  In particular, the Council calls for the U.S. and Canada to build upon the ongoing Clean Energy Dialogue by also focusing on safely and responsibly developing unconventional oil and gas development. Given the boom in unconventional oil and gas development in both countries, closer collaboration on best practices for ensuring safe and responsible development of these resources will be important in working toward both hemispherical energy security and GHG emission reductions.