Gas prices have been on the rise, reaching a high not seen since summer of 2015:
The price increases could have both a positive and negative effect on California and the country’s transportation politics and climate policies.
First, let’s look at the price increases, which have been volatile and uneven. As the Wall Street Journal reported last week:
“The crude complex has seen prices stall a bit near recent highs as the market weighs whether a rising tide of geopolitical risk and strong demand is enough to continue overshadowing U.S. production growth to force prices steadily higher,” said analysts at Schneider Electric.
But analysts expect price declines to remain limited: the potential loss of Iranian oil from global markets might open up extra space for U.S. exports, while the market has already tightened due to falling Venezuelan output, worldwide economic growth and production curbs from OPEC members.
If the price rise lasts, it could affect some key transportation policies and efforts to decarbonize driving. On the positive side for the environment, high gas prices could:
- Boost battery electric vehicles: higher gas prices will encourage people to buy more fuel-efficient vehicles, particularly electric vehicles. That’s an all-around win for the environment and long-term efforts to transition away from fossil fuels.
- Reduced vehicle miles traveled: higher gas prices mean people will be less likely to drive as much, reducing emissions in the process and making it easier to meet our climate goals and decreasing the demand for outlying sprawl housing.
But on the negative or mixed side, higher prices could:
- Help California’s gas tax repeal measure: the California Legislature took a courageous step last year when they voted as a super-majority to increase the gas tax to pay for transportation infrastructure maintenance. Republicans have now put the tax on the November ballot as a voter-initiated repeal measure, hoping it will energize their base to come out to vote. High gas prices in November could give this measure real political life (although I’d rather see legislators investigate possible oil industry price manipulation instead).
- Possibly reduce economic output with less money for investment in clean technology: high gas prices could potentially depress sectors of our economy, which could dampen investment in clean technology generally and undermine political will to tackle environmental problems. But high gas prices in the U.S. cut both ways: while it hurts consumers, it helps oil and gas producers. And in the U.S., we’re among the global leaders in fossil fuel production, as this EIA chart shows:
So high gas prices could boost oil-producing states and the economy for those residents, which could have varied effects on those states’ willingness to pursue clean transportation policies (although admittedly probably minimal, as many of these states are dominated by Republicans and unlikely to support pro-clean tech policies anyway).
Overall, high gas prices could be a political win for most clean transportation policies and technologies, but with some potentially negative consequences as well.
Last week I had the opportunity to tour the world’s first zero-emission marine container terminal at the Port of Long Beach (see photo). The terminal uses fully automated battery electric cargo handling equipment to move containers, with more than 60 lead acid battery electric units running in every day service.
Here is a video I took of the autonomous vehicles, which are pretty mesmerizing to see move on their own:
[youtube https://www.youtube.com/watch?v=z-rJJiKNtLM&w=560&h=315]
The entire project cost well over $1 billion to build and took years to secure all the permitting, according to port officials who led us on the tour. Despite the productivity gains, port leaders seem unlikely to expand the use of the technology anytime soon, given funding constraints.
Still, the terminal is not without controversy. As I blogged about previously, the project led to a battle between labor unions and port officials, as the automations component led to longshoremen layoffs.
Ultimately, as port officials, policy makers, and advocates move toward cleaner freight at the ports, issues such as automation and workforce participation will play a major role in determining the technologies and implementation going forward.
It’s a topic we’ll discuss at the upcoming free UCLA/Berkeley Law conference on June 8th at UCLA on zero-emission freight at Southern California’s ports, featuring a keynote presentation by California Air Resources Board chair Mary Nichols. Sign up today to learn more about this and other issues related to sustainable freight at the ports. MCLE credit available for attorneys. Space is limited!
As I blogged about yesterday, the California Energy Commission unanimously approved a new solar mandate for all new residential construction in the year 2020. I spoke to KPCC radio in Los Angeles and Reuters about the decision.
While I think the mandate is sound economically and environmentally, Severin Borenstein at UC Berkeley takes a contrary view on the economics. Severin doesn’t like rooftop solar in general, as opposed to more cost-efficient utility-scale solar, and he foresees problems with ratepayers subsidizing the installations.
For my part, I think it’s clear the state is heading away from the retail credit model of subsidizing excess solar production, which Severin doesn’t like. Instead, state regulators will likely to move to paying the wholesale rate for surplus solar from rooftops, as Hawaii basically now does. So new batteries will likely accompany these home solar installations, because they will be an economically sound technology to capture surplus solar rather than feed it to the grid for a relatively puny wholesale rate. That’s what we see consumers doing in Hawaii in response to the loss of retail credit.
And in that respect, the new commission rules could help, as they also give batteries “compliance credits” to reduce the size of the needed solar system. They also include incentives to move away from natural gas to new homes, as well as other efficiency measures.
Once again, California is taking a strong leadership position on the environment that will benefit clean tech deployment and save new homebuyers money in the process. The decision should be a major boost for these needed technologies.
The California Energy Commission is the state agency responsible for developing and enforcing energy efficiency standards for new buildings. The result of these stringent codes, starting in the 1970s, has been higher construction costs but saved energy bills and pollution overall.
Now the commission is poised to vote today on a significant new mandate: rooftop solar on all new all new single-family houses built after January 1, 2020, as well as new multifamily buildings up to three stories tall.
As the San Francisco Chronicle reported:
Together with tough new efficiency standards for windows and insulation that the commission will consider Wednesday, the solar mandate could add $10,538 to the cost of building a house, by the agency’s own estimate. The extra expense would hit at a time when California is suffering a severe and deepening housing affordability crisis.
The move’s supporters insist the solar homes would save their owners money by slashing monthly utility bills. That savings could be worth $16,251 over the 30-year life of the house, according to the commission.
The commission took years to develop this proposal and studied the costs and benefits carefully. The agency commissioned a detailed study last year summarizing these findings, which showed the benefits of the policy exceed the costs in every climate zone in the state.
Meanwhile, for developers who don’t like the added cost of the panels to the construction bill, it’s worth noting that a Lawrence Berkeley National Laboratory study from 2015 found that prospective home buyers place a $15,000 average premium on homes with solar compared to similarly situated homes without. This premium would more than compensate developers for the increased construction costs, as homebuyers properly value the utility savings going forward.
In the long run, the move may force the California Public Utilities Commission to scale back incentives for rooftop solar from the current arrangement of giving retail credit to homeowners for their surplus power generation. With every new home having solar, the policy won’t be financially sustainable going forward.
But for now, the upside of a mandate would be a huge boon for the solar industry, as well as significant greenhouse gas emission savings from reduced energy demand from the residential sector. It would also be a powerful statement on climate change and clean energy from the fifth-largest economy in the world, as well as a big boost for renewable energy generally.
Reducing greenhouse gas emissions and ensuring environmental justice should go hand in hand. After all, residents of disadvantaged communities have the most to gain from a transition to a clean energy economy — and the most to lose from climate impacts.
Yet too often climate advocates and the environmental justice (EJ) community are at odds, particularly over policies like cap and trade and efforts to site new climate-friendly development, such as clean energy facilities, rail lines, or smart growth. EJ leaders may oppose large-scale climate policies that benefit the environment overall yet fail to protect specific neighborhoods from pollution, and they may resent changes to processes that leave disadvantaged communities without a seat at the table, among other concerns.
Given the dynamics, how can attorneys incorporate climate change concerns into their practice? Is there an ethical or professional responsibility to consider and discuss with clients the climate change implications of their decisions?
Join me at lunch today starting at 11:30am at the Alameda County Witkin Law Library for a talk on these questions. More information available on-line [PDF]. The event will take place at:
Alameda County Law Library
125 12th Street
Hayward-Union City Room, 4th Floor
Oakland, CA 94607
You can purchase tickets here for $45.00, with lunch included. One hour of participatory MCLE credit is available for attorneys. Hope to see you there!
With climate change and a surging global population, how will our agricultural sector continue to feed the planet in a sustainable way? How are Bay Area innovators and technology companies meeting these challenges, while promoting efficiency and profitability?
We’ll discuss tonight in our next installment of City Visions’ ongoing series on sustainable food production. I’ll be joined by:
- Charles Baron, co-founder and vice-president of product at Farmer’s Business Network.
- Jaleh Daie, Ph.D., founder and chair of AgriFood Tech and partner at Aurora Equity.
- Glenda Humiston, Ph.D., vice president of University of California’s Division of Agriculture and Natural Resources.
Bay Area residents can tune in on KALW 91.7 FM at 7pm, and anyone can livestream the show. You calls and emails with questions are welcome!
Yesterday, California and 17 other states sued the U.S. Environmental Protection Agency for its decision last month to halt Obama-era fuel economy standards for vehicles in model years 2022-25. KTVU News Channel 2 in the Bay Area interviewed me last night as part of their story on the lawsuit:
BAIC EC-Series, the top-selling EV in China
The Trump administration may be pulling back on clean cars, but China is all in. The latest numbers from China on passenger electric vehicles and electric bus sales are impressive, and they point to a future of global dominance for Chinese automakers in the EV world.
First, let’s look at passenger electric vehicle sales, as Clean Technica covered:
After the usual off-season (January and February), March came and electric car sales surged to 59,000 units in China, up 85% year over year (YoY). Quarter 1 2018 sales doubled compared to the same period last year, to over 122,000 units.
Consequently, the 2018 plug-in electric vehicle (PEV) share surged to 1.8%, not that far off from the 2.1% of 2017, and with sales expected to pick up significantly as the year advances, the 2018 PEV share should end north of the 3% threshold.
Last month, the Chinese OEMs represented roughly 40% of all PEVs registered globally, an impressive number that is sure to increase during 2018, possibly even beating its 46% record of last year.
Meanwhile, the Chinese EV automaker BYD had its second-best month ever with 13,100 registrations, just below their 16,000 units sold last December. Analysts expect BYD to start posting 20,000-plus performances in the second half of the year, putting it on par with Tesla’s sales forecasts.
To put those Chinese numbers into perspective, here are the most recent EV sales figures in the U.S. and California since 2011:
So while the entire U.S. has logged 54,423 EV sales in the first 3 months of 2018 (with almost half of that total — 26,771 — from California alone), China hit 59,000 in just one month, with the trend lines only going up.
But it’s not just passenger vehicles. China is heavily investing in electric buses. As Bloomberg reported:
China had about 99 percent of the 385,000 electric buses on the roads worldwide in 2017, accounting for 17 percent of the country’s entire fleet. Every five weeks, Chinese cities add 9,500 of the zero-emissions transporters—the equivalent of London’s entire working fleet, according Bloomberg New Energy Finance.
Much of China’s commitment to electric transportation is due to local air quality concerns. But the country’s leadership surely sees a path to economic domination of the transportation technology of the future, just as they dominate manufacturing in other industries.
While China’s commitment to EVs and electric buses is certainly good for the environment and fight against climate change, it means the U.S. federal government is missing out on a golden economic opportunity, let alone environmental one. EVs are here to stay, and at this rate, it will be China cashing in and not the U.S.
Scott Pruitt’s decision earlier this month to rollback Obama-era fuel economy standards has gotten a lot of media attention — rightfully so. In an interview last week with The Real News Network out of Baltimore, two other panelists and I had an opportunity to discuss the implications:
For those unable to watch the video, a transcript is available.
SB 827, to relax local restrictions on home-building near transit, faces a big test this afternoon at its first Capitol committee hearing. As the hearing draws near, it’s worth noting how disappointing the reaction to the bill has been from some advocacy groups that are supposedly in the pro-climate and transit worlds.
Scott Lucas at San Francisco Magazine has a lengthy piece exploring one of those groups’ opposition to the bill: the Sierra Club California. The article features this exchange with the head of the organization:
Although [Sierra Club California director Kathryn] Phillips says she supports infill development around mass transit, it’s hard for her to locate an actual place in California where she supports new buildings. This is also true of the Bay Area chapter, which in recent years has opposed the 8 Washington condo tower near the Embarcadero, the redevelopment of Treasure Island and the Hunters Point Shipyard, the expansion of Park Merced, and the new Golden State Warriors stadium. Recently, the chapter opposed a 66-unit development in the Western Addition because it would replace an auto repair shop it deemed historic.
With regard to upzoning near transit, Phillips rules out Sacramento, where some neighborhoods, she thinks, would use upzoning as an excuse to block new transit, concealing what she calls “racist” reasons under a civilized veneer. Nor does she think it’s appropriate in more outlying areas like Folsom, where a transit stop under the bill would lead to an upzoning too near wilderness areas. She doesn’t think it’s a good idea in San Diego, where taller buildings would block views of the ocean, nor does she support it in major cities like Los Angeles or San Francisco, where “people who live in rent-controlled buildings worry about bigger and bigger buildings coming toward them.”
As she finishes enumerating those exceptions, she adds, echoing the national organization’s policy line, that “we see the value of infill higher-density development around transit.”
SB 827 has revealed a lot about the politics behind our current housing dysfunction in the state. We knew wealthy homeowners and their allies in office would oppose allowing more homes built in their transit-rich communities. But the bill has also pulled the curtain back on the hypocrisy, confusion and cowardice within much of the climate and transit advocacy community about how to deal with the massive housing shortage in the state.
If SB 827 is successful, it will unfortunately be in spite of many of these advocates. And that’s not a good sign, given how much work needs to be done to improve California’s land use policies in an era of climate change.
