RFF on the Issues: Water recycling in California; Climate change risks

Water Recycling in California

A wastewater treatment plant in Northern California is offering free recycled sewer water to homeowners impacted by the region’s worsening drought conditions. Although recycled water was previously provided for industrial purposes, this is the first time that the plant is providing it directly to residents. More than 10,000 gallons were distributed during the first two weeks of the “innovative” and experimental plan.

In a new blog post, RFF’s Yusuke Kuwayama and Hannah Kamen of the University of Rochester explain that the “yuck factor” often associated with wastewater reuse may not be entirely justified. They note that Florida, a national leader in water reuse (along with California), “currently has no direct potable reuse systems and allocated only 14 percent of its total reused water to indirect potable use in 2013. . . . In fact, most recycled water goes to non-potable uses such as residential greywater, industrial cooling, and irrigation of crops, golf courses, and public access areas.”

Climate Change Risks

A recent Washington Post editorial argued that while scientists are still studying how and where climate change impacts will occur in the future, these uncertainties are “not excuses for doing nothing, or too little, to reduce carbon emissions.” The op-ed notes research results by the Risky Business initiative—which quantified threats such as increases in sea level, storm surges, and energy demand—as an example of data that “should—but probably won’t—snap Congress into action.”

At a recent RFF event, A Discussion of the Independent Risk Assessment for Risky Business: The Economic Risks of Climate Change, members of the Risky Business research team and other experts discussed the methods, data, and significance of the findings for decisionmakers seeking to mitigate future climate change impacts. Video of the event is now available.


Getting Past the “Yuck” Factor: Challenges for Public Acceptance of Recycled Water

Florida recycled water by end use (2013)

Data obtained from the Florida DEP 2013 Inventory Report.

A recent article in Slate ran with the attention-grabbing title “Thirsty West: Why Californians Will Soon be Drinking their Own Pee.”  The article was motivated by the planned $142 million expansion of a water reuse facility in Orange County, which will increase the local district’s capacity to take wastewater and convert it into sterile, drinking-quality water.  Over the past several decades, increases in water scarcity levels and water demand in cities with growing populations have led to the introduction of similar water reuse projects to help boost supply throughout the United States. At the same time, issues surrounding water reuse have surfaced in the popular press, focusing primarily on the “yuck factor” associated with reusing water for potable purposes.

But before referring to potable reused water as “pee drinking,” it is important to distinguish between two types of potable reclamation and to consider some of the processes involved in potable water reuse.  Direct potable reuse (DPR) introduces reclaimed water directly into a potable water distribution system, while indirect potable reuse (IPR) releases reclaimed water post-treatment into natural surface water or groundwater sources as a means of augmenting freshwater supply.  Both DPR and IPR require advanced tertiary treatment processes such as membrane filtration and reverse osmosis, but by discharging treated water into surface water or groundwater prior to reuse, IPR utilizes environmental buffers such as rivers, lakes, and aquifers, which have a natural capacity to further purify the water. The Orange County water reuse facility referred to in the Slate article employs IPR by transferring treated water via a 14-mile pipe to recharge basins in Anaheim, where the water percolates through the soil and feeds the county’s aquifer system.

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Resources Magazine: Do Driving Restrictions Reduce Congestion? Lessons from Beijing

Source: iStock

Source: iStock

By Ping Qin and Jintao Xu

The city of Beijing continues to grow rapidly, not only in population, but also in the number of vehicles on its roads. Although this increased mobility has benefits, the city has become one of the most polluted and gridlocked in the world. Driving restrictions have often been regarded as a silver bullet by various countries and regions seeking to mitigate congestion and pollution problems—including Beijing. However, as has been observed in areas that introduced similar programs, this type of command-and-control policy produces unintended consequences, and Beijing is no exception.

During July 17 to 20, 2007, Beijing became the first city in China to implement a driving restriction policy. It was estimated that this four-day experimental restriction—a trial run for the 2008 Olympic Games—took about 1.3 million automobiles off the roads. After the Olympics, evidence of reductions in traffic congestion and pollution encouraged the government to continue with a similar but less restrictive program. The congestion index—which measures congestion on a scale from 0 to 10—was reduced substantially, shrinking from 7.95 in 2007 to 5.93 in 2009, even though the vehicle population increased by 26 percent in 2007.

Read the rest of this article.

Assessing Landfill Gas-to-Energy Adoption Policies

RFF-DP-14-17-coverVirtually all of us are served by the nation’s vast public and private networks that manage the solid waste we generate—which, in 2012, amounted to about 251 million tons per year, or around 4 pounds per person per day, according to the US Environmental Protection Agency (EPA). From the local city dump that handled waste at the turn of the century, the waste industry has evolved to now include large-scale modern landfills, state-of-the art incinerators, widespread recycling and composting facilities, and a vast network of interstate and international shipments of paper, glass, metal, plastic, and other materials.

RFF researchers have long studied numerous aspects of the sector, including the significant role of local government in relation to private companies in waste management, the effect of Supreme Court and other legal decisions based on the Interstate Commerce Clause in regulating state-to-state shipments of waste, optimal policies for recycling, and the management of e-waste. Among the most recent developments is the emerging role of landfills in helping to manage greenhouse gas emissions.  Landfill gas is the third largest anthropogenic source of methane in the United States, estimated by EPA to account for about 17.5 percent of total US methane emissions in 2011. Growing interest in reducing greenhouse gas emissions has led states to promote the capture of some of the 103 million metric tons of carbon dioxide–equivalent (CO2e) from landfills every year in approaches known as landfill gas energy (LFGE) projects.

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This Week in the RFF Library Blog

Each week, we review the papers, studies, reports, and briefings posted at the “indispensable” RFF Library Blog, curated by RFF Librarian Chris Clotworthy.

A Realistic View of CNG Vehicles in the U.S.
As U.S. natural-gas prices have fallen and supplies have increased in recent years, compressed-natural-gas (CNG) vehicles are garnering renewed attention. Major automakers, such as Ford and General Motors, have announced plans for a half-dozen different vehicle models powered by CNG. Cummins Westport is introducing a full range of medium- and heavy-duty engines that run on either compressed or liquefied natural gas. Clean Energy Fuels, backed by longtime natural-gas proponent T. Boone Pickens, has opened almost 500 CNG truck-refueling stations as part of its America’s Natural Gas Highway network. Companies that operate large vehicle fleets have also embraced CNG. Waste Management, for example, has said it plans to convert most of its refuse trucks to run on CNG… via – Boston Consulting Group

Climate Change Adaptation: DOD Can Improve Infrastructure Planning and Processes to Better Account for Potential Impacts
[What GAO Found] In its Fiscal Year 2012 Climate Change Adaptation Roadmap, the Department of Defense (DOD) identified climate change phenomena such as rising temperatures and sea levels as potentially impacting its infrastructure, and officials at sites GAO visited or contacted noted actual impacts they had observed. For example, according to DOD officials, the combination of thawing permafrost, decreasing sea ice, and rising sea levels on the Alaskan coast has increased coastal erosion at several Air Force radar early warning and communication installations. Impacts on DOD’s infrastructure from this erosion have included damaged roads, seawalls, and runways. In addition, officials on a Navy installation told GAO that sea level rise and resulting storm surge are the two largest threats to their waterfront infrastructure. For instance, they are concerned about possible storm surge during work on a submarine that will be cut in half while sitting in a dry dock. Officials explained that if salt water floods the submarine’s systems, it could result in severe damage… via – US Government Accountability Office

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This Week in the RFF Library Blog

Each week, we review the papers, studies, reports, and briefings posted at the “indispensable” RFF Library Blog, curated by RFF Librarian Chris Clotworthy.

Evolving Business Models for Renewable Energy
…Jointly authored by ACORE members ScottMadden, Sullivan & Worcester, American Clean Energy, RES Americas, Abengoa Solar and Siemens, this resource explores key issues and provides recommendations related to evolving utility and other business models for renewable energy. The report was produced in conjunction with ACORE’s Power Generation and Infrastructure Initiative, and ACORE member contributions to the review provide useful analysis, data, and insight for renewable energy and utility stakeholders… via – American Council on Renewable Energy

Driving Cleaner: More Electric Vehicles Mean Less Pollution
[From Press Release] …Increasing the number of electric vehicles on the road would reduce global warming pollution. Ten states – California, Connecticut, Maryland, Massachusetts, Maine, New Jersey, New York, Oregon, Rhode Island and Vermont – require auto manufacturers to sell electric vehicles in compliance with the Zero Emission Vehicle program. This law will put more than 3.5 million zero emission vehicles on the road in these states by 2025. Even in a scenario with limited growth in renewable energy, this would prevent 4.7 million metric tons of carbon dioxide-equivalent pollution per year compared with conventional cars. That is equal to the annual emissions of almost 1 million of today’s vehicles… via – Environment America

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Resources Magazine: Lifting the Oil Export Ban. What Would It Mean for US Gasoline Prices?

Stephen P.A. Brown and Charles F. Mason explain how, despite fears to the contrary, lifting the US ban on oil exports would bring down prices at the pump.

Earlier this year, the US Senate Committee on Energy and Natural Resources requested a comprehensive review of what would happen to energy prices, consumer prices, and more if the United States were to lift its 40-year ban on oil exports.

Until recently, the possibility of exporting US crude oil was not an issue because the United States was importing so much oil from the rest of the world and forecasts of US oil production were showing a decline. All this changed with the fracking revolution, which quickly opened up vast resources of “tight” oil to exploitation—primarily in North Dakota (the Bakken play) and Texas (the Eagle Ford play and the Permian plays)—and reduced US oil imports to new lows.

Combined with limited pipeline and rail transport capacity, this increase in oil production in the United States has led to bottlenecked oil supplies in the Midwest and much lower crude prices there. The situation has been exacerbated by the inability of most US refineries to efficiently process the light crude oil coming from these fields.

The reaction to these developments has been predictable. Most of the oil and gas industry wants the export ban lifted. The additional demand for US light crude oil will increase industry profits, although probably not prices because oil is priced in a world market. However, some refiners are benefiting from the bottlenecked supplies because they can process the discounted light crude and sell refined products—gasoline primarily—that generally have prices tied to world markets. They oppose lifting the ban.

Environmental groups also oppose lifting the ban. They see increased consumption of fossil fuels as contributing to greenhouse gas emissions worldwide and are concerned about other environmental risks, such as spills.

But the area of greatest and most specific disagreement concerns the effect of lifting the export ban on US gasoline prices. Commenters span the full range, variously finding that gasoline prices will increase, decrease, or remain unchanged. In new research to inform this debate, we find that lifting the ban would boost crude oil production and improve the efficiency of global refinery operations. Accordingly, gasoline production would go up and its price in the United States would fall—anywhere from 2 to 5 cents per gallon once the market fully adjusted to lifting the ban.

​The Ban on Crude Oil Exports

The US ban on oil exports began as a reaction to the oil embargo in the early 1970s and later was codified in law and Department of Commerce rules for granting export permits. Currently, crude oil can be exported to Canada, but only for use there; from Alaska if it comes through the Trans-Alaska pipeline or from Cook Inlet; if it is foreign oil; if it is in conjunction with operation of the Strategic Petroleum Reserve; and for a few other small exceptions.

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RFF on the Issues: Extreme flooding; Shale gas liability; Climate crash

Extreme Flooding

Cities across the Midwest are preparing for even more floods, following torrential rains and tornados that have already caused significant damage. Some in the area have noted that such flooding has “become more the rule than the exception,” with rainfall increasing in both quantity and intensity.

With increased flooding comes increased claims to the National Flood Insurance Program—and it seems that extreme events and damage are becoming “even more extreme,” according to RFF’s Roger Cooke, Carolyn Kousky, and colleague Erwann Michel-Kerjan of the Wharton Risk Management and Decision Processes Center. They note that “yearly losses can be hopelessly volatile and, as such, historical averages are not good predictors of future losses” and suggest that “we may need to rethink our risk management strategies.”

Shale Gas Liability

A Texas family was recently awarded $2.9 million in a lawsuit against Aruba Petroleum, in “one of the first successful US lawsuits alleging that toxic air emissions from oil and gas production have sickened people living nearby.” One of Aruba’s arguments in the case was that the family could not prove that the emissions were coming from Aruba wells.

RFF’s Nathan Richardson argues that liability rules should be revised for shale gas development issues to not only protect the public, but to help specify when companies are responsible and “whether they could be sued.” In new research by Richardson and RFF Visiting Scholar Sheila Olmstead of the University of Texas at Austin, the authors write that while most discussions of shale risk mitigation focus on regulatory measures, the existing legal liability system “could be adapted to address many of the potential risks of shale development.”

Climate Crash

In a New York Times op-ed, former Secretary of the Treasury Henry Paulson, Jr. paralleled the current issues with climate change to the 2008 financial market crash: “We’re staring down a climate bubble that poses enormous risks to both our environment and economy. The warning signs are clear and growing more urgent as the risks go unchecked.” (He also discussed this topic at RFF previously.) Paulson is not the only one taking this approach. In a special lecture at RFF earlier this year, Nobel Laureate Robert Engle explained how financial models can be used to evaluate environmental risk, noting: “I think the fact that environmental stocks, on average, are viewed as underperforming stocks is kind of an important observation because that means people are willing to pay more for them . . . they’re hedging this environmental long-run risk.”

Managing the Risks of Shale Gas Development Using Innovative Legal and Regulatory Approaches

RFF-DP-14-15-coverAt the heart of the US shale gas boom is a tense relationship between the desire for its economic benefits and the fear of its environmental costs. Regulatory measures and industry best practices can be adjusted to ease this tension, but the potential for incorporating innovative tools into new measures has been relatively understudied. Both regulation and litigation are already important components of shale gas risk mitigation, but understanding how these two systems can be improved requires an analysis of how they currently work together.

While state regulation receives the most attention in public discussions about shale gas risk mitigation, liability is probably the more important driver of risk-reducing behavior by operators. According to economist Steven Shavell, the decision to use regulation and liability to account for environmental risks should be based on the presence of information asymmetry, the ability of those at fault to pay, the ability of those at fault to avoid being sued, and the cost of the chosen action. Shavell noted that a mix of liability and regulation is often used in real-world settings, and that society generally gets the regulation–liability decision right.

We believe that this is true in the context of shale gas as well. While the presence of well-informed operators points toward a liability system, a potential lack of victim access to private information would require more regulation-based strategies. Calculating which is more cost-effective is difficult, because liability may be cost-effective for small scale events but less useful for dispersed harms that require complicated class-action lawsuits. Ultimately, the idea that there is a loose “division of labor” between the use of liability and regulation appears to hold true for shale gas development, though that’s not to say that switching between these policies won’t be beneficial in some existing situations.

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Quick Thoughts on UARG v. EPA

SCOTUS released its decision in UARG v. EPA today, with the majority opinion authored by Justice Scalia. The issue in the case was whether EPA appropriately subjected stationary sources to new source review obligations for their GHG emissions. Here are some quick thoughts. If you’re unfamiliar with the case or with EPA’s regulatory agenda for greenhouse gases, this may be a little tough to follow. If you need more background, take a look at this post on the cert grant and the lower court’s decision or the good coverage at Legal Planet. 1)  The court reviewed three related parts of EPA’s carbon policy. After 2007′s Massachusetts decision and its subsequent move to regulate GHG emissions from vehicles, EPA:

a. Required new & modified large stationary emitters (power plants and factories) undergoing new source review (aka PSD permitting – the difference is immaterial here) due to their emissions of conventional pollutants to implement best available control technology (BACT) for GHGs.

b. Required GHG emitters to go through PSD permitting based on GHG emissions alone, even if they would not have to do so for other pollutantsc.

c. Limited the group in b) to large emitters over  100k tons CO2e/year despite the statute’s requirement of 250 tons/year (this is the “Tailoring Rule”).

2)  The court (5-4) rejected policy b) on the grounds that it contradicted the plain meaning of the statute. This is interesting because EPA had claimed that a plain reading required it to include all GHG emitters in PSD, despite the fact that doing so would be really expensive and burdensome. The court’s reading of the statute is reasonable, but it has some problems in light of court’s traditional deference to agencies on questions of statutory interpretation (see #8 below). Read More