Transatlantic Dialogue on Climate Change

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Transatlantic Dialogue on Climate
Change Innovation Drivers
by Kevin Fay Executive Director International
Climate Change Partnership November 20,
2004 Villa Vigoni, Loveno di Menaggio
2111 Wilson Blvd, 8th Floor, Arlington, VA 22201
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Principle Industrial Drivers for Innovation

• Governmental Policy
• Market Response to Supply and Demand
• Consumer Demand

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U.S. Federal Legislative Policy

• Comprehensive Energy legislation
• Energy tax initiatives
• Clear Skies legislation
• Carbon cap and trade legislation

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4
Federal Regulatory Policy

• Registry issues 1605b
• Mercury rules
• New Source Review rules
• Methane to markets

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Individual State Actions

• Northeast (Regional Greenhouse Gas Initiative)
• California Hydrogen Highway and Carbon reduction
  on autos
• Southwest Govs Coalition and renewable mandates
  at the state level

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The global energy picture

• Increased prices for oil, gas
• Increased demand
• Secure supplies?

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Projected U.S. Growth Rates
Source U.S Department of Commerce, Bureau of
Economic Analysis U.S. Department of Labor,
Bureau of Labor Statistics
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Projected U.S. Electric Growth
Source Energy Information Administration, Annual
Energy Review 2002, Department of Energy
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Significant Improvements in Existing and
Development of New Technologies Are Required to
Stabilize Concentrations
Source Edmonds, J.A. and G.M. Stokes. 2004.
Launching a Technology Revolution, in Climate
Policy for the 21st Century Meeting the
Long-Term Challenge of Global Warming, The
Brookings Institution, Washington, DC.
2111 Wilson Blvd, 8th Floor, Arlington, VA 22201
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Industrial Response

• Coal vs. Gas
• Nuclear comeback
• LNG
• Technology vs. fuel switch

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Access and Supply

• NIMBY (Pipelines and Terminals)
• New exploration horizons and regions

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Consumer Demands

• Clean vs. Dirty
• Cost of operation
• Reliability
• Availability

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Future Business Issues for Attention

• Be engaged in all various global efforts
• Maintain ability to capture early actions
  regardless of regime
• Enhance the opportunities for global trading
  system

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Macro Points to Monitor

• Assure that changes in demand will be supported
  by supplies and infrastructure
• That regulatory actions provide certainty and
  clarity for investment returns
• Flexibility in the ability to meet future targets

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15
Wheres the Big Bang?

• Utilities
• Transportation

2111 Wilson Blvd, 8th Floor, Arlington, VA 22201
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Global GHG Emissions - 2000
Source www.epa.gov/methanetomarkets
2111 Wilson Blvd, 8th Floor, Arlington, VA 22201
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U.S. Carbon Emissions by Sector
Source U.S Department of Commerce, Bureau of
Economic Analysis U.S. Department of Labor,
Bureau of Labor Statistics
2111 Wilson Blvd, 8th Floor, Arlington, VA 22201
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www.iccp.net
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Technological Breakthroughs Will Save Trillions
of Dollars While Stabilizing Concentrations
Source Edmonds, J.A. and G.M. Stokes. 2004.
Launching a Technology Revolution, in Climate
Policy for the 21st Century Meeting the
Long-Term Challenge of Global Warming, The
Brookings Institution, Washington, DC.
2111 Wilson Blvd, 8th Floor, Arlington, VA 22201
Phone [phone] Fax [phone]
www.iccp.net
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Developing Carbon Capture and Sequestration
Technologies Can Save Hundreds of Billions of
Dollars
Source Edmonds, J.A. and G.M. Stokes. 2004.
Launching a Technology Revolution, in Climate
Policy for the 21st Century Meeting the
Long-Term Challenge of Global Warming, The
Brookings Institution, Washington, DC.
2111 Wilson Blvd, 8th Floor, Arlington, VA 22201
Phone [phone] Fax [phone]
www.iccp.net
20
Improvements in Energy Intensity Achieve
Significant Emission Reductions
Source Edmonds, Jae, 2004. Presentation to the
Annual Meeting of the Global Energy Technology
Strategy Project.
2111 Wilson Blvd, 8th Floor, Arlington, VA 22201
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www.iccp.net
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Conclusion

• We need a quantum leap vs. an incremental gain
• We need to provide markets to step forward and
  provide most of these developments
• We need business and government to work across
  all of the political time zones

2111 Wilson Blvd, 8th Floor, Arlington, VA 22201
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www.iccp.net