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One Reason To Be Thankful That NJ Has No National Forests

June 25th, 2019 No comments

US Forest Service Study Led To Highlands Act, But Not National Forest Designation

US Forest Service “Forest Health” Program A Pretext For Logging

Although the NJ Highlands were mapped by a US Forest Service Study – which provided the major justifications for the Highlands Act – NJ is only one of only 10 states that have no National Forests.

Ironically, that may be a good thing, as the Trump administration’s US Forest Service becomes increasingly subservient to logging and extractive industry special interests nationally:

The new categorical exclusions in these proposed rules are huge and far from risk-free. Large logging projects, which could devastate vulnerable habitat, and road-building in pristine wildernesses would be among those escaping rigorous environmental review.

For just one recent egregious example, the NY Times reports today on a massive mining proposal that would poison the Boundary Waters Canoe Area Wilderness:

the Forest Service called off an environmental review that could have restricted mining, even though the agriculture secretary had told Congress that the review would proceed.

More specific to the logging topic of my post today, however, I just read a story about USFS plans to log national forest, under the pretext of the North Bridger Forest Health Project.

Because that USFS logging project sounded so much like the euphemisms and slogans used to support NJ DEP’s plans to log Sparta Mountain and other NJ Highlands Forests (i.e. “treatments” “forest thinning” “resilience” “forest health”, etc), I thought I’d look into the details and get an understanding of exactly how USFS justified this crap.

In reviewing the details of the USFS logging, I confirmed what I expected, based on NJ DEP’s forestry program:

1. Despite the science and urgency, USFS forest management is not subject to any laws, regulations, standards, policies, or management practices regarding climate change.

While NJ DEP denies this huge flaw via silence, the USFS admits that, right up front:

Regulatory Framework

There are no applicable legal or regulatory requirements or established thresholds concerning management of forest carbon or greenhouse gas emissions. (See NEPA Categorical Exclusion, p.2)

2.  Water Quality and stream buffer protections are even weaker then NJ DEP BMPs

USFS relies on 15-50 foot stream buffers, but based on stream classification and extremely steep slopes (>35!), buffer can be increased to 100 feet (see Appendix A of NEPA scoping document, and table below):

Screen Shot 2019-06-25 at 1.06.54 PM

That is weaker than DEP’s lax water quality and stream buffer BMP’s.

3. USFS Logging is based on the same “forest health” rhetoric and “science” that NJ DEP relies on

I had seen this similarity several times before, and lazily just assumed it just came from the PR people in the logging industry and the forestry bureaucrats in USFS and NJ DEP.

But today, I hit a few links to the decision documents and traced the legal and policy source of some of these Orwellian euphemisms.

(and keep in mind that the justification I discuss here came in 2014, years before the recent western and California wildfires, which focused public attention on forest management and provided their own cover stories and justification for the need for “treatments” and “fuel management” to avoid “wildfire at the urban-wildland interface”).

In the project overview in the NEPA scoping document, I found this as the source that initiated the logging project:

The North Bridgers project area was designated part of an insect and disease treatment program in accordance with Title VI, Section 602, of the Healthy Forest Restoration Act (HFRA), as amended by Section 8204 of the Agriculture Act (Farm Bill) of 2014. For additional information on how the 2014 Farm Bill amended HFRA and areas designated, see Appendix C.

Buried in Appendix C, I learned the following about that 2014 Farm Bill – including a process for Governor’s to request USFS designation of forests:

Section 8204 of the Agriculture Act of 2014 (Public Law 113-79) (also referred to as Farm Bill) amended Title VI of the Healthy Forests Restoration Act of 2003 (HFRA) (16 U.S.C. 6591 et seq.) to add Sections 602 and 603 to address qualifying insect and disease infestations on National Forest System lands. The Secretary of the U.S. Department of Agriculture delegated authority to implement the provisions of the Farm Bill to the Chief of the Forest Service on March 6, 2014.

Section 602 provides, in part, the opportunity for Governors to request designation to areas in their State that are experiencing, or at risk of, an insect or disease epidemic. The Forest Service received letters from 35 states requesting designations. These requests were reviewed to ensure they met at least one of the following eligibility criteria outlined in the Farm Bill: experiencing forest health decline based on annual forest health surveys; at risk of experiencing substantially increased tree mortality based on the most recent Forest Health Protection Insect and Disease Risk Map; or contains hazard trees that pose an imminent risk to public infrastructure, health, or safety.

Upon reviewing the States’ requests, the Chief designated approximately 45.6 million acres of National Forest System lands across 94 national forests in 35 States. Over 6.6 million acres were designated in the Northern Region (1,708,628 million acres in Idaho; 4,955,159 million acres in Montana). These areas will be further evaluated to identify potential projects that reduce the risk or extent of, or increase resilience to, insect and disease infestations. Information on the request and designation process, by state, can be found here

Here are the national Insect and Disease Designations.

I was surprised and disappointed  to learn that NJ Gov. Cuomo requested designation of 3,000 acres of the Finger Lakes national Forest and USFS did so. I wonder how that project is working out?

As NJ has no national forests, the Governor of NJ requested no designations.

Just think if the Highlands were a National Forest – then NJ DEP’s Highlands logging program would be greatly expanded, given even more resources, and subject to federal control. Guess we dodged a bullet, eh?

4. Government moves like lightning when special interests are greasing the skids

Some say that government bureaucracy moves too slowly and that NEPA review injects huge delays in development (you hear that all the time, especially from those that would exploit and extract natural resources and develop and destroy the environment).

But, check out the accelerated action timetable involved in this national forest designation process, which leads to logging:

That’s damn quick for developing a new and controversial national program.

So, government can move very quickly when special interests are pulling the strings.

Ironically – and thankfully – the project is being blocked by litigation challenging USFS NEPA “Categorical Exclusion”.

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Local Government Zoning Decisions Are Gutting Federal US EPA and NJ DEP State Toxic Site Cleanup Laws

June 19th, 2019 No comments

DEP and EPA cleanup standards are based on local land use planning and zoning

Ringwood Ford and Pompton Lakes Dupont Toxic Sites Latest Examples of Abuse

A new corrupt tactic in the chemical industry driven strategy to weaken NJ’s toxic site cleanup laws and DEP regulations and thereby save billions of dollars in cleanup costs is focused on local government.

The tactic allows local governments – who lack the scientific expertise and legal authority –  to effectively gut State DEP and federal US EPA cleanup standards.

This local tactic stands the law on its head, as both Congress and the NJ Legislature enacted laws like Superfund and NJ Spill Compensation and Control Act that set state and federal standards that put US EPA and NJ DEP in charge of cleanup decisions, not local government.

Specifically, few people realize that US EPA and DEP’s toxic site cleanup standards are based on local land use planning and zoning. Those local plans and zoning designations govern the use of a site, and thereby, influence the potential exposure of people to toxic chemical at those sites.

Follow the logic:

1. DEP sets cleanup standards based on risks to human health.

2. Risk to human health is a function of, among other things, exposure potential.

3. Exposure potential is a function of, among other things, the land use of a site.

For example, a residential site results in human exposure to any toxics on site 24 hours a day, 365 days per year.

In contrast, a commercial or industrial site has far less human occupancy and far less human exposure.

4. Accordingly, DEP cleanup standards are categorized as “residential” and “non-residential” categories. (see DEP soil remediation standards for “residential” and “non-residential” land uses). The standards vary by orders of magnitude.

Which brings us to two recent examples that illustrate a disturbing development, whereby corrupt local governments conspire with polluters to revise local land use master plans and zoning ordinances in ways that subject polluters to lax DEP cleanup standards and thereby let polluters off the hook for billions of dollars in cleanup costs.

Why would a legitimate local government- motivated by a desire to protect the health and welfare of their residents and environment – want to relax cleanup standards and reduce a corporation’s cleanup costs?

This corrupt abuse must stop.

The Legislature, Governor and DEP must get involved to prevent further abuses.

Let me provide 2 recent abuses of what is a statewide problem.

Ringwood – Ford

The US EPA recently let Ford off the hook for a permanent complete cleanup at their Ringwood Superfund site.

Environmental groups and the Ramapough nation are objecting to this corrupt EPA deal, and calling on NJ DEP to extend the public comment period. But they miss the underlying cause of the problem and it’s statewide nature.

In Ringwood, EPA agreed to change the original costly “preferred remedy” – the complete excavation of toxic waste – to a far cheaper, minimal, and far less protective typical “pave and wave” cap. It was  explicitly acknowledged by EPA that this deal would save Ford some $30 million in cleanup costs.

Basically, the Ringwood local government decided to locate a recycling center on a portion of the Ford toxic site, which changed the land use and risk assumptions and thereby provided cover for US EPA to gut their own “preferred remedy”.

I explained how local land use impacted US EPA’s sellout, see:

The Bergen Record reports today that EPA has “decided” to allow the Ford Motor Company to get away with a cynical scheme to avoid millions of dollars in cleanup costs and leave thousands of tons of toxic sludge in the ground, posing permanent risks instead of permanent remedies, see:

In fact, EPA’s own Superfund program manager openly admits that Ford has proposed a scheme:

Opponents of the plan, including many members of the Ramapough Lenape Nation who live next to O’Connor, say the recycling center is nothing more than a way for Ford and the borough to get out of an expensive cleanup.

Even the EPA official who is allowing the capping plan agreed. “I have no doubt that’s the motivation,” said Walter Mugdan, an EPA official in charge of cleaning up Superfund sites in New Jersey and New York. “It’s certainly a very plausible view.” …

“I was unhappy to get this plan at the 11th hour and 59th minute, but it’s not my job or the U.S. government’s job to be in the business of local land use,” Mugdan said.

This corruption is sickening – for US EPA and the Murphy DEP to go along with it adds insult to injury.

Pompton Lakes – Dupont

I’ve called the Pompton Lakes Council the most corrupt local government in NJ.

Their recent decision to rezone the Dupont toxic waste site is further evidence of that.

The Bergen Record exposed the corruption, see:

POMPTON LAKES — Zoning changes up for Borough Council approval Wednesday night would remove residential use from the list of future options for the polluted DuPont tract, raising concerns that the site may not be cleaned to stricter standards. …

But some former and current residents say that rezoning the property would allow Chemours to perform a less comprehensive cleanup.

“It’s basically saying that the property is not going to get a full cleanup,” said Helen Martens, who has lived for four decades in the neighborhood south of the plant where DuPont solvents have contaminated groundwater and vaporized into some homes. “We’re going to have to continue to live in fear that this pollution will still be up there.”

The New Jersey Department of Environmental Protection’s standards for soil cleanups are much stricter for residential development. 

For instance, cleanup standards for soil contaminated with the solvent PCE is more than 35 times as stringent if property is zoned for residential use rather than commercial. The standards for TCE and mercury are three times more stringent, and the standard for lead is two times more stringent. All of these contaminants have been found at the former DuPont campus, nestled in a valley alongside Acid Brook on the north end of town.

These abuses by corrupt local governments are happening across the state, as towns rezone land to reduce cleanup costs and put the health of their residents and local environments at risk.

These abuses must stop, which will require a change in law.

But, the NJ Legislature is beholden to protecting the polluters and promoting real estate development, not protecting the people and environment.

And the NJ ENGO’s are either AWOL or missing the target.

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Our Morning Walk – Ophir, Colorado

June 19th, 2019 No comments

_DSC5640

No words, just photos, just after sunrise on June 16, the day after an extreme hailstorm, from Ophir, Colorado (and isn’t that the coolest post office?)

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alpine climbing school, at the base of 1,000+ foot vertical cliff

alpine climbing school, at the base of 1,000+ foot vertical cliff

unfortunately, this shot was into the sun

unfortunately, this shot was into the sun

We never saw this sign before

We never saw this sign before

this avalanche was recent. Trees mowed down like toothpicks.

this avalanche was recent. Trees mowed down like toothpicks.

this avalanche was a little older and just east

this avalanche was a little older and just east

we took this photo the day before, in a severe hailstorm, at Lizard Head Pass

we took this photo the day before, in a severe hailstorm, at Lizard Head Pass

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As Trump EPA Repeals Obama Clean Power Plan, Murphy Administration Has Retained The Same Christie Legal Attack & DEP Regulatory Policy

June 19th, 2019 No comments

Murphy DEP shares same policy on regulating greenhouse gas emissions as Trump EPA

Has NJ AG Grewal Withdrawn the Christie Lawsuit Against The Obama EPA?

During the media and environmental group feeding frenzy to condemn the Trump administration, keep in mind that the Murphy administration shares exactly the same regulatory policy as the Trump EPA.

[Update below]

The Trump EPA today adopted their proposed new rule which repeals and replaces the Obama EPA’s “Clean Power Plan”, see:

Here’s the most significant implication, which I want to discuss in the context of the NJ regulatory arena:

If the Supreme Court ultimately upholds the rule’s approach to the regulation of pollution, it would be difficult or impossible for future presidents to tackle climate change through the Environmental Protection Agency. …

At issue is the meaning of the 1972 Clean Air Act. The Obama administration interpreted that law as giving the Environmental Protection Agency broad authority to set national restrictions on carbon emissions. The Trump administration asserts that the law limits the agency to regulating emissions at the level of individual power plants.

But before I get to how we came to this point and what it means, let me first note that the Trump EPA shares the same fundamental policy with respect to the role of market forces versus regulation as the Murphy DEP does (as we recently criticized in the DEP RGGI rule).

The  NY Times story makes this clear, stating the key premise of the Trump EPA:

The measure, which is expected to come into effect within 30 days, assumes that the forces of the market will guide the country to a future of cleaner energy by naturally phasing out coal over time. It imposes only modest requirements on coal plants.

That is virtually identical to the Murphy DEP premises regarding market forces:

  • “The CO2 Budget Trading Program is a cap-and-trade program, which is a market-based approach used to control pollution by providing economic incentives for achieving reductions in CO2 emissions from the electric generating sector. (@ page 2)
  • “Any new plants constructed that are subject to the RGGI cap will increase demand for the RGGI CO2 allowances. This is likely to result in upward price pressure on all CO2 allowances, resulting in higher costs for fossil fuel generating sources. This is the core of RGGI’s program design. RGGI is not designed to reduce carbon emissions directly, but instead to make fossil fuel generation costlier to operate. (@ page 41).

Now to our topic today and how we got to this point:

On February 9, 2016, the US Supreme Court issued a stay on the Obama Clean Power Plan.

As the NY Times reports:

The Supreme Court suspended the implementation of Mr. Obama’s plan in 2016, pending the resolution of legal challenges from 28 states and hundreds of companies. It has never come into force.

NJ was one of those 28 states that challenged the Obama EPA rules – the Christie Administration joined coal states like West Virginia (read the brief).

As the American Bar Association explained:

Shortly after the EPA announced the Clean Power Plan, a group of states and industry groups, led by West Virginia, the nation’s leading coal producer, filed a lawsuit to halt the implementation of the plan, arguing that it exceeded the EPA’s mandate under the Clean Air Act and violated states’ rights to regulate electrical power.

The scope of EPA authority under challenge is echoed in NJ law and DEP regulation, as I explained in detail in Christie DEP Approves Another Fossil Fueled Power Plant.

Here is that same legal and regulatory issue in NJ:

“State of the art” in pollution control (SOTA) far too narrow

The DEP regulations define “state of the art” in pollution control (SOTA) very narrowly. According to DEP response to public comment:

Comment: … The commenters stated that regulated GHG emissions could be reduced or eliminated by energy efficiency, reduction in energy demand, demand management, and/or renewable energy; none of these “pollution control” methods were considered. …

Response: Pursuant to N.J.A.C. 7:27-22.2, New Jersey Title V Operating Permit Requirements apply to a facility as defined in N.J.A.C 7:27-22.1. At N.J.A.C. 7:27-22.1, a facility consists of “the combination of all structures, buildings, equipment, control apparatus, storage tanks, source operations, and other operations that are located on a single site or on contiguous or adjacent sites and that are under common control of the same person or persons.” Thus, requirements for off-site measures that are not under control of the owners or operators, such as reduction in energy demand or demand management, are beyond the scope of the NJDEP’s authority to review an operating permit application. Also, the NJDEP cannot redefine a project to include renewable energy.

This DEP rule contrasts with a far broader approach under EPA federal rules. Pollution control technology is generally understood and defined by EPA regulations:

“the term “control technology” is defined broadly to be consistent with section 112(d)(2) of the Clean Air Act to include measures, processes, methods, systems or techniques which reduce the volume of, or eliminate emissions of, HAP through process changes, substitution of materials or other modifications; enclose systems or processes to eliminate emissions; collect, capture or treat HAP when released from a process, stack, storage or fugitive emissions point; are design, equipment, work practice, or operational standards; or a combination of the above.

Obviously, the NJ “State of the Art” in pollution control for greenhouse gases MUST include consideration of energy efficiency, demand management, and renewable energy.

That may require legislation or perhaps the next DEP Commissioner can issue regulations.

Let me repeat the key flaw in NJ DEP regulatory policy with respect to application, scope and content of regulation of greenhouse gas emissions.

DEP wrote this, which is far narrower than the basis of the Obama EPA Clean Power Plan and virtually identical to the Trump EPA policy:

a facility consists of “the combination of all structures, buildings, equipment, control apparatus, storage tanks, source operations, and other operations that are located on a single site or on contiguous or adjacent sites and that are under common control of the same person or persons.” Thus, requirements for off-site measures that are not under control of the owners or operators, such as reduction in energy demand or demand management, are beyond the scope of the NJDEP’s authority to review an operating permit application. Also, the NJDEP cannot redefine a project to include renewable energy.

Compare NJ DEP’s narrow interpretation above with the Trump EPA’s interpretation:

In the proposed repeal, EPA asserted that the BSER in the CPP exceeded EPA’s authority because it established the BSER using measures that applied to the power sector as whole, rather than measures that apply at and to, and can be carried out at the level of, individual facilities.

We note that the Murphy administration has not publicly repudiated the Christie administration’s legal attack on the Obama EPA rule.

We ask the legal eagles out there to advise us regarding the status of the 28 State litigation and whether NJ remains a party to the lawsuit or whether the Murphy AG Grewal formally withdrew NJ’s legal challenge.

Regardless of the status of that lawsuit, we must note that the Murphy DEP continues to implement the narrow Christie DEP regulatory interpretation excerpted above regarding DEP’s authority to regulate greenhouse gas emissions.

This failure to revise seriously flawed Christie DEP interpretation of regulations on greenhouse gas emissions is occurring at a time that several new major GHG emission sources are proposed.

The Murphy DEP has not promulgated regulations to reverse the Christie DEP regulatory policy regarding the scope and requirements of the NJ law of “state of the art in pollution control” (SOTA) with respect to emissions of greenhouse gases.

The NJ legislature has not introduced, never mind passed, new law to clarify these issues.

So, during the media and environmental group feeding frenzy to condemn the Trump administration, keep in mind that the Murphy administration shares exactly the same regulatory policy as the Trump EPA.

[Update: A friendly reader suggested I need to keep it simple:

to translate a bit for an interested, but general audience. The dynamics of what has been done, and what needs to be done, can get very wonky.

No doubt, that is excellent advice, but, I lack the writing skills and adequate time to do so, especially  on such a complex topic.

Come to think about it, most of my posts are wonky by design and are targeted a a policymaking audience, not a general audience.

But let me take a stab:

The larger debate is about 2 closely related but distinct big ideas:

1) the role of the federal government, versus the states; and

2) whether democratic government’s regulatory mandates (e.g. Speed Limit 55 mph) or the so called “free market” (e.g. you decide to drive safely: prices, voluntary individual consumer choices, corporate profit maximizing decisions, et al) should be used to achieve the deep and rapid reductions of greenhouse gas emissions scientists agree are necessary to avoid climate catastrophe.

Regarding #1, obviously coal, oil and gas producing States are economically and politically NOT going to choose voluntarily to abandon fossil fuels and rapidly transition to renewables. So, federal mandates are necessary.

But Trump and right wing Republicans (including Supreme Court Federalist Society members and some corporate Democrats), seek to dismantle the federal “administrative state” in favor of State’s rights. This would cripple EPA powers to regulate a host of critical GHG emission reduction measures, from energy efficiency standards for appliances and vehicles, to pollution limits on coal power plants.

Regarding #2, this is really about democracy versus corporate power.

Long experience has shown that national problems require national solutions, and that collective systemic structural reforms are far more effective, fair, and efficient (technically and economically) than voluntary individual market based choices (just think of car safety: seat belts were vehemently opposed by the auto industry and reluctantly provided as optional “extras” before they were mandated by the federal government. Similarly, fuel economy was more effective via EPA national fuel economy standards, not individual purchasing decisions. Obviously, the federal government mandates were the better approach, compared to individual consumer choice and/or corporate profit driven decisions.

Similarly the role of government and the functioning of democracy are both under attack by far right ideologues who would prefer that corporations and markets rule.

The large ideas play out in regulatory debates and have direct consequences for the health and wellbeing of everyone – and in this case of climate catastrophe, the future of the world.

The Trump EPA says they can’t legally consider whether your corporate energy producer should or could by required by EPA to reduce their GHG emissions, or reduce energy demand, promote energy efficiency or other “demand management” strategies.

The Obama EPA Clean Power Plan said exactly the opposite.

The Trump EPA rules apply only to minor combustion efficiency technological improvement at an individual power plant.

In contrast, the Obama CPP applied to the whole energy sector (“beyond the fence line”), and involved federal EPA in pushing states to implement broad energy conservation (reduce demand), energy efficiency, and demand management strategies, in addition to the narrow combustion and emissions from an individual power plant.

And, finally, few people realize that the NJ DEP regulations and how they interpret them say the same thing as the Trump EPA, despite all Gov. Murphy’s rhetoric about renewables and a transition to clean energy.

The point I’m trying to make, aside from the blatant hypocrisy, is that we will never be able to achieve Gov. Murphy’s goals under current DEP regulations, which limit the scope of DEP’s power and rely heavily on voluntary individual and corporate market decsions.

So, I tried to make this more digestible.  ~~~ end update]

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RGGI Is A Big Lie Generator

June 18th, 2019 No comments

It is insane to rely on a “market based approach” when there is huge “market failure”

RGGI is a small fee to pollute. It provides billions of dollars in subsidies, locks in emissions, and protects polluters from strict science based regulation for at least a decade.

I’ve written about fatal flaws in RGGI so many times now, I won’t repeat all that today.

In a future post, I will update the situation based on DEP’s response to public comments in the adoption document for the RGGI rule. 

Anyone interested in understanding the RGGI program should spend some time with that document, and ignore the Governor’s press release and media stenographers.

However, I have to respond to the Big Lies and spin that NJ Spotlight unconditionally printed today – worst first:

1. Compliance Cost To Large Energy Users – Dennis Hart, NJ Chemistry Council

Aside from failing to note the revolving door abuse of Mr. Hart, a former DEP Assistant Commissioner, NJ Spotlight printed this fact free whopper:

The multi-state initiative is a cap-and-trade program placing a tax on carbon emissions, which is passed on to utility customers. The DEP projects the tax will cost the average residential homeowner $9 more a year on their electricity bill. The cost for large energy users will be much higher, adding hundreds of millions of dollars to their annual bills, according to testimony from Dennis Hart, executive director of the Chemistry Industry Council.

The RGGI allowances are not a “tax”. They are selling for around $5/ton.

The Statewide CO2 emissions cap is 18 million tons.

DO THE MATH: The entire RGGI program – which is paid for by residential, commercial & industrial sectors – is less than $90 million.

HART IS OBVIOUSLY LYING. CALL HIM ON IT – DON”T PRINT THE LIE.

The economic reality is exactly the opposite of Mr. Hart’s Big Lie.

Big Industrial energy users are receiving hundreds of millions of $ in subsidies every year.

Instead of paying a paltry $5/ton RGGI allowances, they should be paying $122/ton DEP air pollution emission fees for CO2, just like other pollutants. (the FY 2017 $117/ton fee as increased to $122)

The RGGI allowance actually is a $117 per ton subsidy.

At 18 million tons, that’s a statewide $2.106 BILLION subsidy – large energy users receive a significant portion of that total statewide annual subsidy.

At minimum, the RGGI allowances should be set at the EPA’s Social Cost of Carbon, which, depending on interest rates and damage assumptions, range from $42/ton – $123/ton in year 2020.

The “external costs” are larger than the market price. That is a massive “market failure”.

So, the RGGI paltry $5/ton allowance is $37/ton – $118/ton  too low to reflect the true social costs of emissions- representing another multi-BILLION dollar subsidy to carbon polluters.

RGGI only covers CO2 emission from an energy production facility. RGGI does not address other greenhouse gas emissions, like methane, which has many times more global warming potential than CO2. RGGI also dos not consider lifecycle emissions, i.e. those that occur upstream of the energy production facility (extraction, wells, pipelines, distribution, processing, leaks and fugitive emissions, etc).

So the subsidy to big polluters – particularly fracked gas power plants – is even LARGER than $2.1 BILLION/YR.

2. “Leakage”

NJ Spotlight uncritically printed this half truth and spin:

Others, however, fear the state’s new rules will end up increasing greenhouse-gas emissions by favoring out-of-state power plants not subject to the carbon tax over cleaner and more expensive New Jersey units. The problem has been called leakage, an issue that must be addressed, according to energy experts and clean-energy advocates.

Without a leakage mitigation plan, today’s action will increase carbon dioxide emissions by 30 million tons from 2020 through 2030, which equates to almost two years of New Jersey’s annual electricity generation emissions,’’ said Adam Kaufman, executive director of the Independent Energy Producers of New Jersey….

In response to such criticism, the DEP noted another regulatory agency, the New Jersey Board of Public Utilities, has committed to starting a proceeding to address problems posed by “leakage.’’

What the Independent Producers, DEP and Spotlight fail to note is that the legislature mandated that BPU adopt what they call a “leakage mitigation plan” by July 2009.

If you really get into the weeds of the DEP adoption document, you san see how DEP subtly lied to cover up that BPU decade of failure. Just compare DEP’s response on bottom of page 27-28. While DEP correctly cited the law, in the statutory text they excerpted, they left out 2 critical things: 1) the legislative mandate “shall”, which they incorrectly describe as a legislative “authorization”; and 2) the July 1, 2009 compliance date. (DEP also misnamed the applicable law: it was the Global Warming Response Act, not the Global Warming Solutions Fund Act.)

Here is the full statutory provision, from the Global Warming Response Act (N.J.S.A. 48:3-87.c(2), where the legislature mandated (emphases mine)

“(2) By July 1, 2009, the board shall adopt, pursuant to the “Administrative Procedure Act,” P.L.1968, c. 410 (C.52:14B-1 et seq. ), a greenhouse gas emissions portfolio standard to mitigate leakage or another regulatory mechanism to mitigate leakage applicable to all electric power suppliers and basic generation service providers that provide electricity to customers within the State.  

The BPU held Stakeholder meetings in 2008 to do so, but never adopted a “greenhouse gas emissions portfolio standard”, BPU Order, or “another regulatory mechanism” to mitigate leakage.

DEP describes this history on page 28 of the adoption document: (the links work there)

The BPU’s February 27, 2008 Order in In the Matter of a Greenhouse Gas Emissions Portfolio Standard and Other Regulatory Mechanisms to Mitigate Leakage, Docket No. EO08030150, which can be found at http://njcleanenergy.com/files/file/2-27-08-8D.pdf, initiated a proceeding to gather relevant information about a greenhouse gas emissions portfolio standard. This proceeding included a public stakeholder process and public hearing on the appropriate measures to mitigate leakage. In its December 17, 2008 Order in the same case, which can be found at http://njcleanenergy.com/main/njcep-policy-updates-request- comments/policy-updates-and-request-comments, after extensive written public stakeholder comment, three leakage mitigation stakeholder meetings held on April 30, 2008, June 5, 2008, and July 8, 2008, to receive comments and testimony provided at public hearing on July 29, 2008, the BPU determined its findings in this matter.

Now, 10 years later, the leakage issue again is used by the energy industry to criticize RGGI.

But at the same time, the energy industry opposes any “greenhouse gas emissions portfolio standard” or “another regulatory mechanism” to mitigate leakage – including a “carbon price adder” – including on energy imports – like other states use to address market failures, prevent “leakage”, and internalize the external social costs of carbon. (e.g. see New York and California)

They can’t have it both ways.

But NJ Spotlight never calls bullshit on their energy industry friends and funders.

And despite DEP pointing the finger at BPU,  the “leakage” issue is not solely a BPU issue.

First, the law mandates that BPU adopt regulations “in consultation” with DEP.

Second, the Global Warming Response Act requires DEP to consider leakage in RGGI regulations:

c. The department shall review its position with any regional auction on an annual basis, including the amount of allowances that should be included in a regional auction. This annual review shall include consideration of the environmental and economic impact of the auction, leakage impacts, and the impact on electric generation facilities and ratepayers in the State. The department shall submit a written report of this review to the Governor and to the Legislature pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1). The report shall also be posted on the department’s website.

3. A Market Based Approach Makes No Sense Under Conditions of Structural Market Failure

Numerous times, DEP describes and defends RGGI as a “market based approach”:

The CO2 Budget Trading Program is a cap-and-trade program, which is a market-based approach used to control pollution by providing economic incentives for achieving reductions in CO2 emissions from the electric generating sector. (@ page 2)

But the energy market reflects huge structural market failures, most significantly: a lack of effective competition, technological monopoly, and huge external costs of energy that are not reflected in the market price of energy (see this for a good technical discussion of SCC).

I will not go into all the economic theory and data on this here, but merely note that it is insane to rely on a market based approach under conditions of structural market failure.

The case for traditional “command and control regulation” is far more defensible and effective in driving real and deep emissions reductions than a failed “market based approach.

Ironically, the 1990 Clean Air Act’s acid rain program, often touted as a “market based approach” that worked, was in fact actually implemented via traditional site specific facility air pollution control permits and emission limits set by EPA, not by “markets” and trading.

4. The Man’s a Ho.

The DEP set the cap at 18 million tons/year, far too high to achieve the kind of deep and rapid emissions reductions that reflect the climate science.

But, a Mr. Bruce Ho of NRDC – see: Jim Hansen Takes On NRDC for background –  ignores all that in a delusional and sycophantic piece of spin, which is almost a verbatim statement that DEP made in the rule adoption document in response to criticism of the cap by environmental groups (see page 42 and compare to Mr. Ho’s.

Here’ DEP: (@ page 42)

New Jersey intends to be an active participant in the RGGI program and looks forward to working with the other states during the next program review to evaluate and improve the program

Here’s Ho:

The other rule establishes the initial carbon-dioxide cap for the state’s electricity generation sector at 18 million tons in 2020.

That is far less than what many argued the cap should be set at, with environmental groups initially pressing for a limit of 12.6 million tons. Anything less, they suggested, would result in less emission reductions and fewer dollars to spend on clean energy programs.

Bruce Ho, a senior advocate for the Natural Resources Defense Council, who came around to accepting the 18 million tons cap, said, “Ultimately, it was reasonable based on the data we were seeing in the energy sector.’’

Ho noted that the DEP committed to work with other states to evaluate and strengthen the RGGI program, an indication that the pollution cap might be tightened in the future. In any event, the governor’s office said the carbon dioxide emissions will decline by 30 percent through 2030.

The 18 million ton cap is NOT “reasonable” in light of climate science. Period.

5. Grazing in the Gas

Some environmental groups have pointed out that Gov. Murphy can not achieve his climate and clean energy policy goals while expanding fossil gas infrastructure. They have demanded that the Gov. impose a moratorium on new gas plants and pipelines.

Yet, far more than a moratorium is necessary, including the phase out and shut down of current gas plants and pipelines and garbage incinerators and sludge incinerators (all are multi-billion dollar stranded investments).

Regardless, DEP casually rejected anything along these lines, admitted that RGGI’s cap would not block new gas plants and pipelines, and went all in for gas. DEP wrote:

Any new plants constructed that are subject to the RGGI cap will increase demand for the RGGI CO2 allowances. This is likely to result in upward price pressure on all CO2 allowances, resulting in higher costs for fossil fuel generating sources. This is the core of RGGI’s program design. RGGI is not designed to reduce carbon emissions directly, but instead to make fossil fuel generation costlier to operate. (@ page 41).

At a paltry $4-$6/ton CO2, that ain’t gonna happen! RGGI is a small fee to pollute and it locks in emissions and protects polluters from strict science based regulation for at least a decade.

And I wonder if they cleared that statement with the Gov.’s office?

6. Delusions

Instead of telling the truth about the fatal flaws of RGGI and energy markets, calling for aggressive implementation of public transportation and current zero emission car mandates, and demanding new building codes and retrofit requirements, some so called “green groups” are actually seeking to expand RGGI to transportation and building sectors:

Nevertheless, clean-energy advocates see in RGGI a template for curbing other climate-warming emissions in other sectors, particularly the transportation sector. Late last year, the Murphy administration joined a regional initiative to reduce carbon pollution from transportation sources.

“The Transportation Climate Alliance is finally starting to address emissions from cars and trucks across state lines,’’ noted Doug O’Malley, director of Environment New Jersey, citing efforts to electrify the sector. “We are going to need to address those emissions more rapidly.’’

If it is insane to rely on a market based approach under conditions of structural market failure, it is delusional to call to expand failure.

I could go on – but I’ll stop here and close wIth a serious question:

What is it about RGGI that drives good people to lie so blatantly?

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