Roger Caiazza
It’s been a month since I updated Watts Up With That readers on New York’s net zero in 2050, the plan Climate Leadership and the Community Protection Act (Climate Act). My last post explained that Draft scoping plan The definition of how to “achieve the State’s robust clean energy and climate agenda” has been published and is available for comment. This post notes that there is a Overview of the Draft scoping plan available. I also want to address their claim that “the cost of inaction exceeds the cost of action by more than $90 billion.
Background
The Climate Act was passed in 2019 and went into effect on January 1, 2020. The Climate Action Council has worked since then to develop plans to implement the Act. Starting in the fall of 2020 seven consultation board developed recommended policy to meet the targets presented to the Climate Action Council in the spring of 2021. In the summer of 2021, the New York State Energy Research & Development Authority (NYSERDA) and the Economic Adviser Environment + Energy (E3) prepared Integrated Analytics to “estimate the benefits, costs, and economy-wide GHG emission reductions associated with pathways to achieving the Climate Act’s GHG emission limits and carbon neutrality targets”. Three Integrated Analysis execution strategies have been incorporated into Draft scoping plan when it is released in late 2021.
The Draft Plan defines the scope of the document to be very large. The document is 861 pages long and the content of the Scoping Plan report is 330 pages. There are eight appendices Available individually:
- Appendix A: Recommendations of the Advisory Board
- Appendix B: CJWG’s response to the Advisory Board’s recommendations
- Annex C: JTWG recommendations to the Council on measures to reduce carbon leakage risks and mitigate the anticompetitive impact of potential carbon policies and energy sector mandates
- Appendix D: Power generation sites identified by JTWG
- Annex E: JTWG recommendations to the Council on issues and opportunities related to EITE entities
- Appendix F: Environmental and Health Data to Quantify Climate Policy Health Benefits
- Appendix G: Integration Analysis Techniques Supplement
- Appendix H: Components of Recommendations for Adaptation & Resilience
Newly released Overview of the Draft scoping plan provides some more details on the implementation plan and is a pretty good introduction to New York’s green new deal law. The law not only stipulates net zero GHG emissions by 2050 but also has social equity components. I will only mention one aspect of the review as it is the epitome of the Climate Act.
Cost of Inaction Exceeds Cost of Action
Slide 9 Key benefit-cost findings in the Summary Summary claim that “Costs of inaction exceed costs of action by more than $90 billion.” It goes on to explain: “Significant investments are required to achieve the Climate Act GHG Emission Limits, which come with even greater external benefits and the opportunity to generate hundreds of thousands job”.
Slide 10, Cost-benefit assessment, in the Overview section provides some details on costs and benefits. It is said that the numbers behind the $310 billion, $290 billion and $305 billion number labels of the columns in the figure are not available. The only chart of how those costs are spread across all of New York’s energy sectors is another. That makes it nearly impossible to provide meaningful comments and, in my opinion, also represents a deliberate attempt to obfuscate cost calculations.
I have written several posts about the benefits of the Scoping Plan at Blog in the past few months. Benefits of the Climate Act Scope Plan summarized all the findings in those papers. I also prepared a blank sheet of paper, Costs and benefits of a scoping planwhich describes all calculations and provides detailed information.
In short, the benefits are overstated. The plan describes total health benefits of $165 to $170 billion due to improved air quality. Air quality has improved markedly since 2000, and the reductions observed between 2000 and 2019 are 16 times larger than the improvements projected for the Climate Act in the Identification Plan. limit. Until the time comes that the State can show that the improvements in benefits from the changes in air quality observed since 2000 are 16 times greater than the benefits claimed herein, I There is no doubt about that statement. The increased positive transportation benefit of $39.5 billion is based on a “first-order estimate based on statewide numbers” meaning “we guessed a benefit ignoring the fact that this claim may only occur in certain areas but not the entire state”. Therefore, the benefit estimate is too high. The benefits of energy efficiency interventions in low- and middle-income homes are claimed to total $8.7 billion, but $2.4 billion of that is from non-interventions. energy and should not be considered a benefit to the Climate Act’s greenhouse gas emission reduction programs.
The boast that the Climate Act has more benefits than costs is based on the claimed benefits to the cost of avoided GHG emissions ranging from $235 to $250 billion. The Climate Act manipulates emissions to increase benefits and uses a lower discount rate than current Federal guidance, resulting in the social benefit of GHG emission reductions 4.5 times higher. times for 1990 emissions and 5.4 times higher for 2019 emissions than other jurisdictions.
Calculating the social benefit of the avoidable impact to reduce greenhouse gas emissions
All of the above schemes and dubious attempts to inflate the benefits of the Climate Act so that the cost of not considering the costs of action does not capture a positive number, so the authors used uses an imprecise method to calculate the social cost of carbon benefits. This section explains how they cheat.
Slide 3, GHG Emission Reductions, graphically displays current estimated GHG emissions (2019), baseline 1990 emissions and targets for 2030 and 2050. Due to lack of documentation for numbers cost data, the calculation of social benefit figures is not available. I cannot reproduce the $235 billion to $250 billion estimate from the available information. I believe this represents a deliberate attempt to cover up “on thin ice” calculations.
However, in my opinion, the claims of positive effects are bogus. Figure ES.1 in the New York Department of Environmental Conservation (DEC) GHG inventory shows annual emissions statewide from 1990 to 2019. DEC did not provide the actual numbers used to generate this image and you will forgive me for pointing out trends. obviously avoid any numbers that might confound the narrative. The only numbers provided are the 1990 base value of 402.54, the 2005 maximum value of 458.55 and the 2019 value of 379.43. All these values are in million tonnes of carbon dioxide equivalent under GWP20.
For the sake of this argument, we can even ignore New York’s unique game of the value of the carbon system that gives numbers different from any other jurisdiction. The only reference to comparable values with other inventories states “When compared, when applying the normal format, or UNFCCC, to government accounting, emissions were reduced by 21% percent from 1990 to 2019, or from a net emission rate of 210.43 mmt to 165.46 mmt CO2e GWP100”.
The Social Cost of Carbon (SCC) or the Value of Carbon is a measure of the costs avoided by the effects of global warming by the year 2300 realized by reducing emissions by one ton today. We don’t even have to worry about bias in the values of the SCC calculations used to show their claims are bogus. We know that the NYS GHG inventory figure is a 1990 baseline value of 402.54, a 2005 maximum value of 458.55 and a 2019 value of 379.43 million tonnes of CO2 equivalent under GWP20. We also know New York value of carbon in the same unit of measure. If the Climate Act removes New York’s GHG emissions from any of the three values listed, the social benefit is the total of those emissions times the NY value of carbon. The state recommends using a 2% discount rate that provides a social benefit between $46.7 billion and $56.4 billion using 2021 value depending on which historical emission value is used.
Despite all efforts, the social benefit in the Scope Defined Plan is not large enough to claim a positive net benefit. The plan defines the system game scope by relying on DEC Value of the Avoidance Carbon Guide. In the Guidance section entitled “Estimating the emission reduction benefits of a plan or goal”, an example is included:
“The net present value of the plan is equal to the cumulative benefit of the emissions reductions that occur each year (adjusted for the discount rate). In other words, the value of carbon applied for each year, based on the reduction from inaction, is 100,000 tons in this case. The appendix provides the value of carbon for each year. For example, the social cost of carbon dioxide in 2021 at a 2% discount rate is $127 per ton. The value of the cuts in 2021 equals $127 multiplied by 5,000 tonnes, or $635,000; in 2022 $129 multiplied by 10,000 tons, etc. This calculation will be made for each year and for each discount rate of interest. “
I believe the instructive approach is wrong because it applies a social cost many times over for each ton of reduction. As shown above, using any total value of GHG emissions observed multiplied by some social cost representing all social benefits if those emissions are reduced by 2300 would bringing in benefits from $46.7 billion to $56.4 billion. Using DEC’s guidance would bring in benefits between $235 billion and $250 billion. If only that flaw were corrected, the total benefit would range from minus $74.5 to negative $49.5 billion instead of a net benefit of between $90 billion and $120 billion.
Inference
Despite their best efforts to mislead their numbers to assert that the costs of inaction exceed the costs of acting on the Climate Act, New York State must rely on clear guidance that incorrect. Using their lifelong approach, someone who lost 10 pounds 5 years ago can claim to have lost 50 pounds. That makes no sense and illustrates the length of time that Climate Act advocates will have to go through to get the “right” answer.
It is also stated that the Draft Scoping Plan and technical documentation does not provide any digital contingency information for the social benefits of GHG emission reductions or cost projections. Skeptics like me believe that indicates that they know their numbers are bogus.
Nothing stops anyone comment on the Draft scoping plan. Comments submitted now in New York may prevent some of the same atrocities from reaching your jurisdiction in the future, so feel free to comment.
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Roger Caiazza blogs about environmental and energy issues in New York at New York’s Pragmatic Environmentalist. This represents his opinion and not the opinion of any of his previous employers or any other company he is affiliated with.
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