With Trump’s 30 percent tariff on foreign solar panels scheduled to last four years from February (decreasing by 5 percent per year), how is the U.S. solar industry faring so far?
First, the good news. As E&E News covered [pay-walled], the Solar Energy Industries Association reported installations of 2.5 gigawatts in the first quarter of 2018, a 13 percent increase over the same period last year.
And due to the tariffs, firms have announced $1 billion in new spending plans to build or expand U.S. solar panel factories to take advantage of the tax on imports.
Overall, the U.S. solar industry employs more than 250,000 people, or roughly three times more than the coal industry, with 40 percent of those workers in installation and 20 percent in manufacturing, per the U.S. Energy Information Administration.
But that’s where the good news stops.
The positive numbers for the first part of this year are in fact the result of most installers delaying their 2017 projects until the tariffs were announced. As E&E News noted, modules for installations that came online this year were ordered prior to the tariffs.
Meanwhile, the tariffs have caused U.S. solar companies to cancel or freeze investments totaling more than $2.5 billion in large installation projects, which will cost thousands of jobs and more than offset any economic gains from domestic investment, per Reuters.
Specifically, the negative impact may be felt the most in the Southeast U.S., where the economics of solar were already borderline, according to MJ Shiao at the Wood Mackenzie consulting firm.
But the long-term trends may not be so bleak. Globally, China cut its subsidies and incentives for solar panels in May, presumably in response to the U.S. tariffs. As a result of that policy shift and the decreased deployment in the U.S., global prices have fallen, possibly as much as much as 35 percent.
As a result, the industry has seen record-low power purchase agreements with recent installations. For example, the Central Arizona Project, a municipal water utility, signed a $24.99-per-megawatt-hour contract with AZ Solar 1 earlier this month, which Greentech Media called the cheapest solar contract ever signed. And NV Energy, Nevada’s main utility, announced a deal for a $23.76-per-MWh contract with Eagle Shadow Mountain’s 300-megawatt development.
So the short-term results are mixed and likely to get worse. But as both the tariffs and prices decline, the U.S. industry may hopefully soon find its way out of the temporary hole created by the tariff policy.
Alexandria Ocasio-Cortez garnered a lot of publicity last month when the 28-year-old self-described “democratic socialist” from the Bronx beat longtime US representative Joe Crowley in the New York primaries. She is practically certain to win a seat in Congress in the general election this November.
While her economic policies have inspired the Democratic base, her advocacy on climate change is noteworthy. Specifically, she’s calling for a “Green New Deal” to reduce greenhouse gas emissions and transition our economy to one based on clean technology, like renewable energy. While she’s not the first politician to make this part of her platform (Jill Stein also tried), she may be the most high-profile at this point.
As E&E News reports [pay-walled]:
“What we are proposing is the complete mobilization of the American workforce to combat climate change and income inequality simultaneously,” Ocasio-Cortez told HuffPost. “The Green New Deal we are proposing will be similar in scale to the mobilization efforts seen in the World War II or the Marshall Plan. It will require the investment of trillions of dollars and the creation of millions of high-wage jobs.”
Among the specifics, she wants the U.S. to achieve 100 percent renewable electricity by 2035 and otherwise work to modernize the grid.
From my perspective, this bold advocacy is refreshing. It not only summons the urgency of the need to combat climate change, it transforms the solutions into a jobs and economic development strategy. Those economic benefits are both politically important to inspire regions of the country that need the jobs and also a logical and positive consequence of investing billions of dollars to modernize and clean our energy system, from the electricity to the transportation sectors and beyond.
I hope her advocacy will inspire other elected officials to follow suit. It could be a winning strategy for climate advocates in future elections.
Scandal-plagued EPA Administrator Scott Pruitt finally resigned today, after weathering scores of likely ethics violations (at least 14 federal investigations are looking into his conduct in office). It’s even possible he’ll be facing criminal charges based on some of his actions, particularly allegations that his office doctored public records related to his schedule and hid emails from the public.
Meanwhile, his resignation letter reveals his belief that God helped Trump get elected and also put Pruitt in his position of power — a hubris that likely contributed to his lavish lifestyle while in office:
Mr. President, it has been an honor to serve you in the Cabinet as Administrator of the EPA. Truly, your confidence in me has blessed me personally and enabled me to advance your agenda beyond what anyone anticipated at the beginning of your Administration. Your courage, steadfastness and resolute commitment to get results for the American people, both with regard to improved environmental outcomes as well as historical regulatory reform, is in fact occurring at an unprecedented pace and I thank you for the opportunity to serve you and the American people in helping achieve those ends.
That is why it is hard for me to advise you I am stepping down as Administrator of the EPA effective as of July 6. It is extremely difficult for me to cease serving you in this role first because I count it a blessing to be serving you in any capacity, but also, because of the transformative work that is occurring. However, the unrelenting attacks on me personally, my family, are unprecedented and have taken a sizable toll on all of us.
My desire in service to you has always been to bless you as you make important decisions for the American people. I believe you are serving as President today because of God’s providence. I believe that same providence brought me into your service. I pray as I have served you that I have blessed you and enabled you to effectively lead the American people. Thank you again Mr. President for the honor of serving you and I wish you Godspeed in all that you put your hand to.
Your Faithful Friend,
Scott Pruitt
From a good government perspective, it’s a win that Pruitt is out. It’s also a credit to investigative journalism that surfaced many of these scandals.
But from an environmental perspective, it actually may be a loss. Pruitt was deeply tied to industry and hostile to environmental protection. But he was tremendously incompetent at actually laying the evidence-based case for regulatory rollbacks, instead focusing on splashy press conferences to make it look like a new policy was actually going into effect. Instead, many of his efforts are likely to be reversed by the courts.
His temporary successor, deputy administrator Andrew Wheeler, is likely to be much smarter about regulatory rollbacks, as my colleague Sean Hecht writes on Legal Planet:
Pruitt’s replacement (at least for now), Andrew Wheeler, is certain to continue the anti-regulatory, anti-science slant of this EPA. In addition to being a coal industry lobbyist, Wheeler was chief of staff for many years for Sen. James Inhofe, who was been the Senate’s strongest voice against climate science and environmental protection. His views in opposition to strong environmental and public health protection are widely known. At the same time, Wheeler has a reputation for being more careful than Pruitt, and also for understanding the workings of the agency. This should mean that he will be less likely to break agency norms and alienate staff. But from a policy perspective, Wheeler’s ascension to this role will surely continue the path Pruitt has been on since he was confirmed, and possibly be even more effective. Regardless, it’s sure to be an interesting time at EPA.
We’ll see what happens on the policy front. But in the meantime at least, all who care about good government should celebrate this departure.
U.S. Supreme Court Justice Anthony Kennedy was a conservative justice, yet he occasionally voted with the four more mainstream justices on environmental issues. Presumably, his successor (if confirmed by this Republican-majority senate) will be more conservative. If that’s the case, here are three issue areas where a new Supreme Court could directly affect climate and energy progress:
- Federal Clean Power Plan: Kennedy was the crucial fifth vote on Massachusetts v. EPA, which held that the federal Clean Air Act required U.S. EPA to regulate greenhouse gas emissions as a pollutant. As a result of that ruling, the Obama Administration eventually proposed the Clean Power Plan, which would have compelled states to reduce carbon emissions from their power sectors. The regulation is tied up in litigation and likely to come before the U.S. Supreme Court. A new court could potentially overrule Massachusetts v EPA entirely or narrow EPA’s authority so much that it’s essentially meaningless. Notably, I believe the latter possibility would have been likely even with Kennedy on the bench.
- California’s waiver authority to regulate emissions beyond federal standards: the federal Clean Air Act allows California to set more aggressive standards than federal ones, provided EPA approves a waiver for the state to do so. Waivers were historically issued almost automatically, until George W. Bush came along and delayed approving one for California’s tailpipe emission standards. Now the Trump Administration is mulling going a step further: revoking previously granted waivers, such as the one to allow California to set tailpipe standards (which were harmonized with strong federal fuel economy standards under Obama, but since reneged on by Trump’s team). The U.S. Supreme Court will likely have to rule on EPA’s authority to revoke existing waivers, if Trump’s EPA chooses that course. The implications would be huge for California’s efforts to boost zero-emission vehicles.
- Regional grid management to promote clean technologies: the federal government has jurisdiction over wholesale power markets that cross state lines. So grid operators that seek to promote clean technologies, like renewable energy, energy storage, or demand response, often need federal agency approval. And the U.S. Supreme Court will occasionally hear cases on appeal. While the scope of these decisions is often narrow, they can affect regional efforts to reduce emissions from the power sector. A new court could potentially seek to undermine these efforts (although as E&E News describes [paywalled], these cases so far have been wonky and not subject to close partisan rulings by the justices).
Other cases could also affect climate policies, such as those involving federal agency regulation of methane emissions from oil-and-gas operations, as well as regulation involving other short-lived climate pollutants (described in E&E news [also paywalled]). But these three loom large for me.
Overall, Kennedy’s retirement is not good news for those who care about environmental protection, as I told the San Francisco Chronicle. But on the flip side, most of the action on climate right now is at the state and local level. Any federal progress will have to come from Congress, not from the courts. And that dynamic is now even more true now with Kennedy’s departure.
The big legal news while I was out last month was the announcement that Supreme Court Justice Anthony Kennedy, the crucial swing vote, was retiring from the court. I had a chance to listen to Justice Kennedy speak back in 2014 in Berkeley and ask him a question about judicial term limits (he was open to them).
Interestingly, his 2014 talk focused on his concerns about the U.S. citizenry taking our democracy for granted. As I summarized at the time:
But Kennedy turned more serious when discussing the state of politics and culture in the country. In short, he is quite concerned, even alarmed, at what he perceives to be the lack of civility in the country and even worse at the lack of appreciation among younger generations of our “heritage of freedom.” He said our democracy is still vulnerable, people around the world are watching us, and it’s incumbent that we teach the younger generation to appreciate what we have. He cited the example of a former communist country where democracy is breaking down and alarmingly, no one seems to care. He also described how at least in communist Poland great thinkers went into teaching and instilled democratic values in students for decades, whereas our educational system is now lagging.
Justice Kennedy with former Berkeley Law dean Sujit Choudry in 2014
Given his concerns about declining civility and attacks on democracy, it’s surprising he decided to retire when his successor will be appointed by probably the most uncivil president we’ve had in generations, who regularly attacks our democratic processes and institutions. But then again, Justice Kennedy is 81 years old and likely has strong personal reasons for stepping down now.
And in the interest of accountability, I’d also note that my take on his remarks at the time appears to be spectacularly wrong:
I found his sense of alarm surprising and something I don’t share to quite that degree. Sure, there are lots of reason for pessimism about the state of the U.S. But I don’t see our democracy as under threat from a sleep-walking public. I think our governing institutions are basically working as intended.
Given what we’ve seen so far from this administration in terms of its commitment to democracy (with candidate Trump claiming the presidential election would be “rigged” and taking no interest in investigating potential foreign interference in our elections, among other transgressions), I’d say I was pretty off.
Meanwhile, Kennedy’s retirement carries some significant implications for climate and energy law, which I’ll discuss in a subsequent post.
Happy Summer!
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.
British blues-based guitarist Eric Clapton was both everywhere and nowhere for most of the 1960s and 1970s. He played with a series of legendary bands and musicians throughout that time, but ultimately jumped around from band to band as he struggled to deal with deep-seeded attachment issues and drug addiction.
The documentary on Showtime “Eric Clapton: A Life in 12 Bars” illustrates the sad but ultimately redemptive story of the renowned guitarist.
Clapton had a troubled childhood: the people he thought were his mom and dad were really his grandparents, as his real mom (their daughter) had him at 16 after a one-night stand, and quickly moved to Canada to avoid the stigma. She left her baby Eric behind with her parents. By the time he found out the truth later in childhood, he felt angry and betrayed. And when his birth mother finally came to meet him, she rejected his request for her to be a mom to him.
Perhaps this childhood hurt and resentment, as well his general loner nature, fueled his attachment problems. He became immersed in the blues he heard on the radio and obsessed with the African American musicians who played it. At one point in his life, as he recalled in the liner notes of the Robert Johnson box set, he wouldn’t talk to anyone who hadn’t heard of the then-obscure and short-lived Mississippi blues player.
Like many in his musical generation, he parlayed a love of blues into British rock, first sweeping to fame with the Yardbirds. But he eventually left them for John Mayall and the Bluesbreakers once the Yardbirds got too “pop sounding” with mainstream hits like “For Your Love.” He then left John Mayall for Cream, most famous for the hit “Sunshine of Your Love.”
But Clapton left Cream after getting in fights with his bandmates. He joined super-group Blind Faith with Steve Winwood, but then left them for a series of musical collaborations with groups like the Allman Brothers. Eventually, he went solo and wallowed in isolated and heroin addiction, followed by more than a decade of debilitating alcoholism. He was so drunk at some shows in the 1970s that he would cut short sets and berate fans from the stage.
His romantic life suffered, too. He became obsessed in the early 1970s with George Harrison’s then-wife Pattie Boyd, but she wouldn’t leave Harrison for him. So he wrote an album of lovesick songs about her with Duane Allman, including the classic “Layla” (see the live performance video below), based on the Persian poem “The Story of Layla and Majnun.” But after he played the finished album for her, a mortified Boyd still refused to leave George for him (she and George later divorced, and she later married and then divorced Clapton).
In the 1980s, he fathered a daughter with another man’s girlfriend, and she decided to raise the child without Eric, which was fine with him given his constantly inebriated state. But then his current girlfriend got pregnant with a son, Connor, in 1986, and that birth finally chased him into sobriety. He became by all accounts a devoted father to Connor.
But Connor tragically fell out of a New York City window in 1991 and died, running through the low-slung open window before anyone could stop him. Clapton decided to honor his dead son’s life by staying sober, and he wrote the beautiful acoustic tribute “Tears in Heaven” for him. His 1993 MTV album “Unplugged” of his big hits went on to win a Grammy for album of the year, and Clapton dedicated himself to raising money for a rehabilitation clinic for low-income substance abusers.
Clapton is now married and raising three children and appears content at this stage of his life, even reconnecting with his first-born daughter. He also continues to help promote the careers of many of the African American blues musicians who inspired his music.
While his life story is full of sadness, tragedy, and personality challenges, Clapton appears to have overcome many of the setbacks to lead a life of fulfillment. Throughout it all, he played with some of the best musicians of his generation, including Jimmy Page, Jeff Beck, Jimi Hendrix, the Beatles (including the legendary guitar solo on “While My Guitar Gently Weeps”), Steve Winwood, Duane Allman, the Rolling Stones, Chuck Berry, The Who, and B.B. King, among others.
“Life in 12 Bars” is worth watching even for casual Clapton fans, as it’s a journey through some of the most inspired years of rock ‘n roll and some of its biggest hits as well. And this legacy of hit songs from Clapton, from his long-running career, continues to inspire fans around the world.
Energy economists don’t like rooftop solar. Depending on the policy involved, it can entail significant and cost-inefficient ratepayer subsidies. For example, Lucas Davis at UC Berkeley’s Energy Institute at Haas recently calculated that non-rooftop solar customers are paying $65 per year to subsidize solar customers. He got this number by taking the difference in price between a retail credit for every kilowatt hour delivered from a rooftop solar customer to the grid and the wholesale price that this electricity actually costs.
In California, the average retail electricity price is about $0.18/kWh, while wholesale rates are close to $.04/kWh. That means that utilities are losing about $.14/kWh for each retail credit they give rooftop solar customers for their surplus solar (since they could have purchased the electricity for much cheaper elsewhere). And since utilities have a lot of fixed costs sunk in grid infrastructure, Davis was able to calculate the total subsidized amount spread over non-rooftop solar customers and divide it by ratepayers to arrive at the $65 per year in ratepayer cost-shifting.
Ultimately, it’s that cost-shifting that explains why energy economists like Davis and Serverin Borenstein hate California’s new solar rooftop mandate so much.
But this cost-shifting doesn’t have to happen — it’s due specifically to electricity rate policies. And in that respect, Hawaii tells a different and more promising story. Ultimately, I believe that state’s rooftop solar policies are where California is headed soon.
In Hawaii, utilities stopped offering full retail credit for surplus rooftop solar back in 2015. Instead, they essentially pay solar customers the wholesale rate for their surplus. As a result, utilities aren’t losing what would be $.14/kWh in California for each retail credit they give. So no cost-shifting happens.
And the impact on the ground for Hawaii rooftop solar customers? Homeowners are still ordering solar panels, but now home battery installations are starting to take off, too, as this state government chart from Utility Dive shows:
To be sure, it’s still relatively early days of the policy and the on-the-ground response. But given plunging battery prices, as well as cheaper solar installations, this solar-plus-battery technology solution seems like a great way to address complaints about cost-shifting and ratepayer subsidies. It also points to a path forward for the rest of the country, with a future of rooftop solar on most homes — and batteries in every basement or garage.
The upside is more clean technology deployed, a bigger market to bring down costs further on solar and home energy storage, reduced greenhouse gas emissions, and improved grid resilience in the case of extreme weather or other disasters. Not a bad deal all around, and one California will probably eventually see as well, as its rooftop solar policies evolve.
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!
