Climate challenge is at a critical moment

“We are in a very fragile moment,” said Ali Zaidi, President Joe Biden’s national climate adviser. “The inflection point breaks in two very different directions.”

This week, that reality is a subject of intense interest for businesses, climate activists and government officials gathered in New York for the United Nations General Assembly and related climate events dubbed “Climate Week NYC.” 

American voters will have a major say in which direction the fight against climate change proceeds. Former President Donald Trump and his supporters have sought to turn clean energy into “a stalking horse for Chinese dominance, a driver of rising energy costs, or a globalist ploy. Trump promises to cancel Biden’s vehicle-emissions regulations, unlock more oil drilling, and once again take the U.S. out of the Paris Agreement on climate change, wrote Time’s Justin Worland. Trump has called the shift to EVs a “transition to hell.” He has blasted the Inflation Reduction Act, with its many incentives to spur the move to clean energy, as a “green new scam” and promised to claw back unspent funding from the IRA if he wins the presidency.

Would he succeed? As Worland reported, “Even in some deep-red regions, new jobs making clean technologies like solar panels and electric vehicles are winning the backing of climate-skeptical Republicans.” It’s not unusual, he wrote, to see a Republican lawmaker at a groundbreaking for a solar-panel factory or an EV plant. “Democrats hope—with good reason—that continued investment will broaden support for climate measures.”

But in rural western Michigan, he pointed out, where two major EV-battery plants are planned, “the conversation sounds completely different. Residents have been inundated with mail campaigns and ads from right-wing activists and organizers decrying the plants.” Republican Congressman John Moolenaar spent more than $60,000 of federal funds on a campaign that included an ad claiming that the battery maker “does the bidding of the Chinese Communist Party.”

A growing cohort of climate advocates view the simmering anti-climate narrative “with a concern bordering on panic,” in Worland’s words. They have seen versions of the same fight playing out elsewhere, and it hasn’t gone well. In Europe, farmer protests and rising energy costs have put pressure on the European Union’s Green Deal.

The result, amid the hottest year on record, is a sort of climate retreat. Even French President Emmanuel Macron, a supporter of climate initiatives, last year called for the EU to embrace a “regulatory pause” on new environmental rules. 

American officials have argued that “stitching the green transition into the tax code,” as The Hill’s Tobias Burns put it, and incentivizing private business is a good way to insulate the shift away from fossil fuels from political pressures. “This is now the tax code,” White House economist Lael Brainard said. “These rules are complex, they take a very long time to write, and they take a very long time to amend.”

Worldwide, voters still seem to care about climate change. In the EU’s 2023 poll of citizens across the bloc, 93 percent said they believe climate change is a serious problem. “It’s not that they deny the facts,” says Teresa Ribera, a vice president of the Spanish government and minister of ecological transition. “They lack confidence in institutions to shape the proper responses.”

So climate advocates, researchers, and public officials are “scrambling,” wrote Worland. Legislators are tweaking proposals to soften their impact on low-income people, and forward-thinking policymakers are devising creative ways to keep vulnerable communities from being left in the dust. Many other politicians are backtracking, making a counterintuitive bet that by taking a few steps back on climate policy they will help protect climate efforts by keeping right-wing politicians out of office. But slowing down carries grave risks too. The longer we take to cut emissions, the worse warming will be. To get through this moment, leaders will need to thread a needle.

Making that needle tougher to thread are “three big things (that) have shifted since the Paris accord,” wrote Somini Sengupta and Max Bearek of The New York Times: “China has raced ahead of every other country, including the United States, to dominate the global clean-energy supply chain, fueling serious economic and political strains that undermine incentives to cooperate. Rich countries have failed to keep their financial promises to help poor countries shift away from fossil fuels. A widening gyre of war — from Ukraine to Gaza and now, in Lebanon — has become an impediment to global climate consensus.”

“We have this really difficult moment,” Danny Cullenward, a senior fellow at the University of Pennsylvania’s Kleinman Center for Energy Policy, told The Wall Street Journal. “The election is a giant cliff.”

Americans Discovering Value of Climate-Oriented Tax Credits

The law passed by Congress in 2022 to promote the transition away from fossil fuels contained far more carrots than sticks–and Americans are gobbling them up.

The statute, called the Inflation Reduction Act, provides tax credits  and other benefits for a wide range of actions that citizens and businesses can take to fight climate change. The five most popular credits during the first year were for solar panels, insulation or air sealing, exterior windows and skylights, exterior doors, and central air conditioners.

More than 3 million American households used the act’s subsidies for homeowners last year, collectively saving more than $8 billion, according to an August 7 report by the U.S. Treasury Department. It was the first detailed snapshot of how these more benefits were used in their first full year, by whom and where. The department called the $8 billion a “significant” number that is higher than initially expected, Nadja Popovich reported in The New York Times..

The bulk of the money, more than $6 billion, helped households install rooftop solar panels, small wind turbines and other renewable energy systems. These credits were most popular in sunny states, including much of the Southwest and Florida.

While those are encouraging numbers for tax credits, of the more than 137 million tax returns the government had processed by late May, some 3.4 million of them — or approximately 2.5 percent — took advantage of at least one of these two subsidies. That’s about 30 percent more people than used similar, though less generous tax credits in 2021, but it means that the vast majority of taxpayers are not participating.

Many experts believe that more taxpayers should be taking advantage of these opportunities. So a nonprofit group, Civic Nation, is launching a "Save on Clean Energy" campaign to educate Americans about the law. Civic Nation’s campaign involves more than 40 groups and messengers,  including United Way, Carrier, Sunrun, the League of Conservation Voters, and a bipartisan group of mayors from around the country. The U.S. Department of Energy is also involved.

The intent is to help spread the word through trusted local messengers such as schools and community-based organizations. “It can't just be, you know, press releases,” Civic Nation CEO Kyle Lierman told Axios. “It has to be a kind of surround sound campaign, where folks are hearing about how they can take advantage of these opportunities on their phones when they read the news, but also at their churches, at the supermarket, at the door."

President Biden's top climate diplomat, John Podesta, who is overseeing the rollout of the IRA's clean energy provisions, considers the Civic Nation partnership a new effort in the energy space, whose goal is to make it clear to people that not only are energy rebates available, but also to show them how to complete the process by listing nearby contractors, for example. "Some of this is a lack of general awareness that these general programs are available," he said, but some is also a question of ‘What does it mean for you?’" 

EVs becoming more affordable

“The E.V. market has hit an inflection point,” Randy Parker, chief executive of Hyundai Motor America, told The New York Times recently. “The early adopters have come. They’ve got their cars. Now you’re starting to see us transition to a mass market.”

His words appeared in a front-page story, which began with this quote from Alex Lawrence, a dealer in Salt Lake City who specializes in used electric cars: “We’re seeing younger people. We are seeing more blue-collar and entry-level white-collar people. The purchase price of the car has suddenly become in reach.”

Americans bought a record 1.2 million EVs in 2023, according to Cox Automotive's Kelley Blue Book. That's equivalent to 7.6 percent of the total U.S. new-vehicle market, up from 5.9 percent in 2022. 

Cox predicts that EVs will account for 10 percent by the end of 2024. “Throw in hybrids and plug-in hybrids,” Axios’ Joann Muller reported, and Cox says "electrified" vehicles could comprise almost 24 percent of new car sales by then.

Prices are falling because of increased competition, lower raw-material costs and more efficient manufacturing, The New York Times’ Jack Ewing wrote. Federal tax credits of up to $7,500 for new electric cars, often augmented by thousands of dollars in state incentives, push prices even lower.

The price of electric cars is plummeting so fast that they’re now almost as cheap as gas-powered cars, The Washington Post’s Nicolas Rivero reported. “Since EVs first hit the market, car buyers have had to pay a steep premium if they wanted a car that ran on batteries instead of a gas engine. Two years ago, they would have paid about $17,000 more on average for a new electric car than for a new gas-powered car. But that gap has been rapidly closing, shrinking to $5,000 last month, according to data from Cox Automotive.”

The long-term trend toward cheaper electric cars is due mainly to falling battery prices. Batteries are nearly 90 percent cheaper today than they were in 2008, according to the U.S. Energy Department.

Tesla, Ford, General Motors and Stellantis, the owner of Jeep, and other carmakers have announced plans for electric vehicles that would sell new for as little as $25,000.

But what if President Biden, who has championed the transition to EVs, loses in November? Will EVs lose, too? “There may be some hiccups in the exact pace and scale of E.V. sales if there are major policy changes, but I wouldn’t expect the E.V. market to flatline,” said Peter Slowik, who leads research on passenger cars at the International Council on Clean Transportation, a research organization. “Most automakers,” he explained to Ewing, “are committed to an all-electric future, and many are planning on a timeline that goes far beyond the next administration.”

Slowik’s group estimates that cars and sport-utility vehicles capable of traveling 400 miles on a full battery will cost less than cars with internal combustion engines in 2030, even before taking into account government subsidies. 

Those calculations do not take into account lower fuel and maintenance costs that strengthen the financial argument for electric vehicles. Electricity is almost always cheaper per mile than gasoline, and battery-powered vehicles don’t need oil changes, engine air filters or spark plugs. For people who drive a lot, electric cars may already be a better deal. At the same time, some automakers are offering strong discounts on E.V. models as an enticement for buyers.

By next year, there will be more than 100 fully electric models for sale in the United States, according to Cars.com, an online sales platform, double the number available last year. “We’re at the point now where anybody that wants an E.V. for a price point can actually get an E.V.,” said Rebecca Lindland, senior director of industry data at Cars Commerce, which operates Cars.com.

Best ways for each of us to fight climate change

Each one of us can take steps to reduce the impact of climate change. From the time we climb out of bed in the morning until turning out the lights at night, we have the power to fight back against this powerful threat.

But individuals’ action “can only go so far,” said Dr Shobha Maharaj, a climate impacts scientist from Trinidad and Tobago. “Deep, rapid cuts in carbon emissions from oil and gas, as well as other sectors such as transport, are needed, which are outside the control of the average individual.” Maharaj is one of 380 who responded to a survey by The Guardian newspaper, which sought the views of every contactable lead author and review editor of reports by the UN’s Intergovernmental Panel on Climate Change since 2018.

Seventy-six percent of these experts stressed the importance of voting for politicians who pledge strong climate measures. “I feel the reason behind the lack of response to date is the nervousness of politicians,” said Professor Bill Collins of the University of Reading in the UK. “Polls suggest voters are actually more willing for governments to take stronger climate action.” 

And the most powerful action governments can take is to put a price on carbon emissions. That will speed the transition to clean energy–while reducing air pollution and other problems caused by the burning of fossil fuels. “The science is there, but the lack of will of politicians worldwide is retarding climate change [action],” said Alexander Milner, a professor at the UK’s University of Birmingham.

The second-most-effective individual action, the experts said, was reducing flying and fossil-fuel powered transport. Flying is the most polluting activity an individual can undertake. Frequent-flying “super emitters,” who represent just one percent of the world’s population, cause half of aviation’s carbon emissions.

Almost 30 percent of the experts said eating less meat was the most effective climate action, while a similar proportion backed cutting emissions from heating or cooling homes. In her new book Not the End of the World, Dr. Hannah Ritchie of the University of Oxford echoes those thoughts. In an extensive interview, she spoke with The New York Times Magazine’s David Marchese about ways people can make a difference: “Eating less meat, in particular beef. For most people in the world, reducing their meat consumption would have a big impact. Reducing food waste. How you travel: walking, cycling, public transport is always best. In terms of household energy, the big thing is heating or cooling. So insulation, installing a heat pump, if you can install solar panels. Those are big things.”

Trading in your gasoline-powered car for an electric car would pay significant dividends for the planet–and probably for your long-term finances–wrote The Washington Post’s Sarah Kaplan. She also noted the value of simply buying fewer things.

While each of us tries to contribute to the solution, can we expect our public officials to do their part? Ritchie tends to be optimistic about that. “[T]he potential is there, and with each year that passes, I think it’s harder for countries to find excuses not to.”

First global carbon tax is coming into view

The first worldwide carbon tax appears to be steaming into view. In late March the United Nations agency that regulates the shipping industry essentially committed to requiring shipping companies to pay a fee for every ton of carbon they emit by burning fuel. 

“I’m very confident that there is going to be an economic pricing mechanism by this time next year,” Arsenio Dominguez, the secretary general of the International Maritime Organization, said. “What form it is going to have and what the name is going to be, I don’t know.”

This step is “potentially world-changing,” Manuela Andreoni and Max Bearak wrote in The New York Times. They reported that there are at least 50,000 cargo ships like the ill-fated Dali, which crashed into Baltimore’s Francis Scott Key Bridge, constantly on the move, transporting the vast majority of the world’s goods. Shipping accounts for roughly 3 percent of global greenhouse gas emissions, slightly more than aviation. 

About 70 countries and states around the world have put a price on carbon, either through taxes or trading mechanisms. But if the IMO finalizes this proposal, it would be the first carbon fee to apply around the globe.

The IMO has been considering carbon pricing and other market-based measures for more than 10 years. The organization said that by adopting the proposal it was simply living up to its pledge, made last year, to decarbonize the entire shipping industry by 2050. Its member countries have agreed that they need to start charging the shipping industry for emissions of heat-trapping gases in 2027.

The organization still must make many decisions about pricing carbon, The Times’ reporters noted. “How would a price be calculated? Would it be a flat fee or part of a trading mechanism between companies? Who would collect the money and distribute it? And which fuels are considered low-carbon?

“Countries are looking at seven different proposals, in which prices range from $20 to $250 per ton of carbon emissions... They hope to decide on all that by next year.”

Such a fee would very likely raise tens of billions of dollars a year. That revenue could accomplish a lot. "The Pacific is pushing for a majority of the revenue to support the most climate vulnerable in responding to climate change," the Marshall Islands' envoy Albon Ishoda said in a Reuters dispatch last summer. 

Economist DominikEnglert and his colleagues from the World Bank suggested in a study that countries should use the money to decarbonize the shipping industry, invest in efficiency measures that could reduce shipping costs for poorer countries and deploy it for broader climate action.

Many of the world’s biggest shipping companies are pushing for a more ambitious carbon price because that would mean they wouldn’t need to pay for the same tax in Europe, The Times explained. Companies ideally want to avoid paying carbon taxes in multiple jurisdictions, which would result in a lot of complex and expensive accounting.

“If I think back three years ago, the IMO was just about the most conservative organization I have ever encountered,” the European Commission's Green Deal chief Frans Timmermans told a side event at last June’s Paris climate finance summit. “And now the atmosphere has completely changed.”