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Into Climate Change

On Trial: Social Cost of Carbon

The Minnesota state utility regulators asked an administrative law judge to rule on the social cost of carbon (SCC). Dr. Curry has posted links to some testimony. Dr. Richard Lindzen testified "new evidence (Stevens, 2015) reduces the uncertainty of aerosols so climate sensitivity is now "extremely unlikely to exceed 2 ºC". He estimates it is from 0.85 ºC to 1.5 ºC. Dr. Richard Tol built the FUND integrated assessment model. Table 3 of Tol's testimony Exhibit 2 shows that the SCC using a climate sensitivity of 1 ºC is negative 18 $/tC, ie, quite beneficial.

What is the True Cost of Electricity?

The Institute for Energy Research published a report that determined the levelized cost of electricity from existing generation sources. The study shows that on average, electricity from new wind resources is nearly four times more expensive than from existing nuclear and nearly three times more expensive than from existing coal. These are dramatic increases in the cost of generating electricity. The premature closures of existing plants will unavoidably increase electricity rates.

An Analysis of the Obama Administration’s Social Cost of Carbon by Dr. Pat Michaels

The US Administration’s Interagency Working Group on the Social Cost of Carbon (IWG) released a report that was a response to public comments of the IWG determination of the social cost of carbon that were solicited by the Office of Management and Budget in November 2013. Of the 140 unique set of comments received, the IWG adopted none. Dr. Pat Michaels of the CATO Institute address why this decision was based on a set of flimsy, internally inconsistent excuses and amounts to a continuation of the IWG’s exclusion of the most relevant science which assures that low, or even negative values of the social cost of carbon (which would imply a net benefit of increased atmospheric carbon dioxide levels), do not find their way into cost/benefit analyses of proposed federal actions.

True Costs of Wind Electricity

Many pro-wind organizations claim wind generated electricity is cost competitive with fossil fuel generated electricity, but Rud Istvan and blogger Planning Engineer show that it is not. The US Energy Information Agency calculates a very misleading "levelized cost of electricity" (LCOE) to compare different generating technologies, but excludes many costs of wind energy. The 2013 cost of the wind Production Tax Credit (PTC), the main US federal incentive, was $US 13 billion, but is exclude from the LCOE. The actual installed cost/MW of installed wind farm capacity started rising around 2005, but the EIA assumes wind costs will decline 22% by 2019. The EIA also overestimates the capacity factor and the useful life of windmills, and fails to account for costs of the electrical grid, backup requirements and market distortions related to the intermittency of wind electricity. The cost of wind electricity is at least $US 146/MWh, about 50% more than the EIA estimate of $US 96/MWh.

Economic Impact of the Greenwich Wind Farm

Dr. Ross McKitrick reviews a report on the Greenwich wind farm economic benefits. He says the report is "deeply flawed" and "ridiculous". He writes, "the methodology of this report bears no relation to conventional economic analysis and has yielded grossly misleading results." The report ignored all the costs and grossly exaggerates the benefits. The most disturbing aspect of the report is that the Ontario government accepted it. The wind farm "is a wealth-destroying undertaking" and will do "tragic harm ... to the North Superior landscape and ecology."