Energy Reform and theSustainability Principle

Dean Irma S. RussellUniversity of Montana School of Law

April 25, 2013Law Reform and Energy Policy

University College CorkCollege of Business and Law

Outline

• Part I: The Sustainability Principle• Part II: The Current Energy Picture • Part III: Governmental Policy:

• Comparative Incentives • Conversation Stoppers

PART I THE SUSTAINABILITY PRINCIPLE

Development of Sustainability Concept

• 1987 UN Brundtland Report "our Common Future“

• 1992 Earth Summit in Rio de Janeiro, Brazil• 1993 Convention on Biological Diversity (CBD)• Necessity of Good governance• Constitution – Examples of U.S. State

constitutions (Montana)

MONTANA CONSTITUTION - Preamble

• We the people of Montana grateful to God for the quiet beauty of our state, the grandeur of our mountains, the vastness of our rolling plains, and desiring to improve the quality of life, equality of opportunity and to secure the blessings of liberty for this and future generations do ordain and establish this constitution.

Montana Constitution

• Article II – Declaration of Rights• Section 3. Inalienable rights. All persons are

born free and have certain inalienable rights. They include the right to a clean and healthful environment...

Sustainable Development Defined

“Meet the needs of the present without compromising the ability of future generations to meet their own needs.”

Point of no return?

• Hawken: we have already passed the point at which the planet can support the current population.– Economic program thus must “restore.”

• Peak oil: the point of declining energy supply– Does this make changes to energy supply and demand

moot?• Schellnhuber: Carbon Dioxide Insolvency• Changes in world-wide energy consumption

– Developing countries, China, etc.

Sustainability & Global Climate Change

• Debate on global climate change is shifting to what to do about it

• Adaptation• Mitigation

PART II: THE CURRENT ENERGY PICTURE

Scope of GHG Emission

• Average US citizen use of resources 5.5 times GHG average

• Increased carbon dioxide concentration in itself can cause impacts on human health

Sustainable Energy

• At the center of any discussion of sustainable development:o Energy is crucial to every aspect of the economyo Energy production and use are implicated in

climate change

Global Climate Change

• Need for government Energy initiatives and incentives

• Proven Technologies • Solar • Wind• Wave

Potential Government GHG Response

• Cap and trade• Auctioned rights for GHG emissions• Direct taxation of carbon emissions• Technological controls

Government Role

• Governmental incentives, which have helped build the current energy industry, are needed to respond to global climate change while sustaining the global economy.

PART III: GOVERNMENTAL POLICY: COMPARATIVE INCENTIVES

Current policy approaches to comprehensive climate legislation

have failed

• Cap and trade limitations - complexity and enforcement difficulties for governments to implement and monitor

• Market-based approach - risky, difficult to foresee risks and outcomes

Structure of energy incentive programs

• Incentivizing renewables• Changes in subsidies in competing energy

sectors• Risks inherent in renewable energy• Patchwork of regulation• International Efforts (such as Kyoto Protocol

and Rio)

U.S. Experience: Federal Progress Regulating GHG

• Massachusetts v. EPA• National Environmental Policy Act• State and local efforts

National Environmental Policy Act

• Created to recognize the role of government agencies in affecting the environment.

• Environmental Impact Statement (EIS)• Incorporates environmental considerations

into major federal actions• Often thought of as the National

Environmental Protection Act.

NEPA drawbacks

• Delays in major energy projects• Nothing to encourage development of clean

energy alternatives • Shale, tar sands, and other unconventional

fuels are categorically exempted from EIS process

Environmental Impact Statements

• Describe environmental impacts of proposed federal projects

• Set forth alternatives• Note relationship between short-term and

long-term benefits• Note irreversible commitments of resources.

Sub-federal Efforts

• States– RGGI - efforts of 7 northeastern US states– California's 2006 Global Warming Solutions Act

• Cities and local government– Mayor's Climate Protection Agreement– Individual city efforts

State Efforts*• Many states issued interim or final studies • Include CO2 emission reduction through:

– Energy efficiency in buildings– Regional cooperation– Changes in land use– Green technology development– Climate change adaptation

* Patricia Salkin, Can You Hear Me Up There? Giving Voice to Local Communities Imperative for Achieving Sustainability.

Mayors’ Climate Protection Goals• Reductions below the Kyoto targets• Urge state and federal government to follow

suit• Advocate for greenhouse gas reduction

legislation• 1060 Mayors*

* As of 4/19/2013, http://www.usmayors.org/climateprotection/climatechange.asp

Local Climate Change PlansLos Angeles Example

• Emits 0.2% of GHG gases - 1/2 from transportation

• Goal: 35% below 1990 levels by 2030• Leverage changes in land use regulation,

building guidelines, and invest in transit• Sustained leadership will be necessary

Effective Governmental Incentives

• Brazil: biomass fuel; autos: 85% ethanol• Turkey: Reduction in use of wood for heating• Japan: 75% drop in price of photovoltaics

Renewable Benefits

• Geographically mobile

• Widely distributed• Not limited to the

point of extraction

Renewable Subsidies

• 2011 renewable energy subsidy $24 billion out of $16 billion in energy subsidies

• 2005: $3.2 billion renewable energy subsidy out of $14.5

Why Energy Reform is Inevitable

• Precept of sustainability fundamental to human connectedness, flourishing, and survival

• Human rights depend on a safe, clean and healthful environment

• The environment and energy policy are inextricable intertwined

What is Next?

• Conversation stoppers• Alternative conversations