Energy Policy
Energy Policy
Energy and the Human Development Index
Energy use is correlated with quality of life in many countries. However, improvements in this quality of life (HDI) level off at higher levels of energy consumption.
Definitions
Gross Domestic Product (GDP)
Monetary value of all goods and services created by an economy.
Per capita GDP (GDP per person)
The GDP of an economy divided by the number of persons in that economy.
Per capita energy use (Joules per person)
Energy intensity of GDP (Joules per GDP)
Energy and GDP
There is a correlation between energy use and the gross domestic product in countries.
US GDP
2006
Population 300 million
Energy use 100 Quads
Energy per unit of GDP
We can think of energy intensity as a form of efficiency. How much energy does it take a country to create economic value?
Energy per capita
California Electricity Consumption
Tools to affect energy use
How do we make changes to our energy system? Laws, institutions, and markets set the rules for energy usage.
Cap and Trade
Carbon Tax
Mandates
Renewable Portfolio Standards
Subsidy
You will use your quantitative skills to assess the impact of these different policy instruments.
The Resource Curse
Experts have observed that discovering petroleum wealth in a country often doesn't lead to better economies or health for the country. This idea is called the resource curse.
Several countries that have oil as a significant fraction of their economics have low ratings for the HDI and democracy.
California
California
Global Warming Solutions Act of 2006 (AB 32)
Reduce GHG emissions to 1990 levels by 2020
1990 was 427 million metric tonnes of CO2 equivalent
How are we doing?
California 2050 goal
80% reduction below 1990 levels
How do we achieve this goals?
What can we do on a county or state level?
Sonoma County
Sonoma County
Sonoma County Energy Independence Program (SCEIP)
Property Assessed Clean Energy (PACE)
Sonoma County
Recently announced PACE Financing Marketplace
Allows multiple choices of funding for consumers
Property Assessed Clean Energy (PACE)
Allows loans to be paid back on the property tax bill
Funded through municipal bonds
Loan is attached to the property
Has funded over $68 million dollars in projects
United States
Clean Air Act 1963
Clean Water Act 1972
Energy Independence and Security Act of 2007
Sonoma County Action Plan
Sonoma County Climate Plan
Sonoma County Climate Plan
Sonoma State
What policies could you imagine here at Sonoma State
CSU Policies
Global Negotiations
Rio Earth Summit, 1992
Negotiated the United Nations Framework Convention on Climate Change
(UNFCCC)
Kyoto Protocol, 1997
Adopted at the 3rd Conference of the Parties (COP 3)
China and India not required to cut
US did not ratify the treaty
Burden of emissions reductions placed on developed countries
Copenhagen Climate Change Conference, 2009
15th Conference of the Parties (COP 15)
Viewed as a disappointment by many
Paris, 2015
21st Conference of the Parties (COP 21)
Goal of limiting average temperature increase to 2 degrees Celsius
above preindustrial levels
Montreal Protocol, 1987
International agreement to reduce Chlorofluorocarbons (CFCs) and other
ozone damaging chemicals
Provides an example of a world wide emissions reduction treaty
China US Climate Agreement
Last week, the US and China announced a historic agreement to reduce
GHG emissions
Discussion
Read the
We will then discuss some questions
What are the basic terms of the agreement?
For the US?
For China?
Are these terms meaningful?
How do these compare to existing targets like California AB32?
What difficulties do you anticipate?
Why would China want to reach this deal
Why doesn't China want to peak now?
Why would US want this deal
Why not?
Direct and Indirect Subsidies
Subsidies are financial benefits to consumers of a product. In the case of energy they can be costs that didn't have to be paid or a direct payment from the government.
Fossil Fuels
Intangible Drilling Costs Deduction. We provide tax deductions for oil exploration costs.
Social cost of carbon. These are costs we estimate are borne by the public but are not paid for by fossil fuel companies or consumers.
Solar
Federal tax credit for solar panel installation
Renewable electricity production credit
Finance
Some financing or bonds are provided by the government for investment. The lower cost of capital means a lower repayment cost and is a subsidy for the energy project that receives it.
Examples
We want to reduce GHG emissions about 85% by 2050. Sonoma county has a 2015 GHG emission of 3.5 units and a 2050 target of 0.5 units. This reduction will happen over 35 years.
This works out to about a five percent per year reduction.
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