CS3 In the News
China's worsening air pollution, after decades of unbridled economic growth, cost the country $112 billion in 2005 in lost economic productivity, a study by the Massachusetts Institute of Technology (MIT) has found.
The figure, which also took into account people's lost leisure time because of illness or death, was $22 billion in 1975, according to researchers at the MIT Joint Program on the Science and Policy of Global Change.
The study, published in the journal Global Environmental Change, measured the harmful effects of two air pollutants: ozone and particulates, which can lead to respiratory and cardiovascular diseases.
"The results clearly indicate that ozone and particulate matter have substantially impacted the Chinese economy over the past 30 years," one of the researchers, Noelle Selin, an assistant professor of engineering systems and atmospheric chemistry at MIT, said in a statement.
Ground-level ozone is produced by chemical plants, gasoline pumps, paint, power plants, motor vehicles and industrial boilers. Inhaling it can result in inflammation of the airways, coughing, throat irritation, discomfort, chest tightness, wheezing and shortness of breath.
Past studies have shown that high daily ozone concentrations are accompanied by increased asthma attacks, hospital admissions, mortality, and other markers of disease.
Particulates -- spewed out by power plants, industries and automobiles -- are microscopic solids and droplets so tiny they penetrate deep into the lungs and can even get into the bloodstream.
Lengthy exposure can result in coughing, breathing difficulties, impaired lung function, irregular heartbeat and premature death in people with heart or lung disease.
MORE DAMAGING THAN THOUGHT
The researchers made their calculations using atmospheric modeling tools and global economic modeling, which were useful in assessing the impact of ozone, that China started monitoring only recently. Using this methodology, they were able to simulate historical ozone levels.
Kelly Sims Gallagher, an associate professor of energy and environmental policy at Tufts University's Fletcher School, who was not involved in the study, said the findings revealed the problem was even worse than thought.
"This important study confirms earlier estimates of major damages to the Chinese economy from air pollution, and in fact, finds that the damages are even greater than previously thought," Gallagher said.
China is a large emitter of mercury, carbon dioxide and other pollutants. In the 1980s, China's particulate concentrations were 10 to 16 times higher than the World Health Organization's annual guidelines, the researchers said.
Even after significant improvements by 2005, the concentrations were five times higher than what is considered safe.
Chinese authorities are aware of the devastating effects of the degradation to the environment and are taking steps to tackle it.
This month, authorities announced plans to reduce air pollution by 15 percent in the capital, Beijing, by 2015, and 30 percent by 2020 through phasing out old cars, relocating factories and planting new forests.
SOURCE: Andy Wong, AP
By: Wendy Koch
China's unprecedented growth is carrying a steadily steeper price tag as its air pollution hikes the nation's health care costs, finds a new study by the Massachusetts Institute of Technology.
Although China has made substantial progress in reducing its air pollution, MIT researchers say its economic impact has jumped from $22 billion in 1975 to $112 billion in 2005. The costs result from both lost labor and the increased need for health care because ozone and particulates in air can cause respiratory and cardiovascular diseases.
"The results clearly indicate that ozone and particulate matter have substantially impacted the Chinese economy over the past 30 years," Noelle Selin, an assistant MIT professor of engineering systems and atmospheric chemistry, said in announcing the findings that appear in the February edition of the journal Global Environmental Change.
The study, by researchers at the MIT Joint Program on the Science and Policy of Global Change, said pollution's economic impact has grown, because population growth increased the number of people exposed to it and higher incomes raised the costs associated with lost productivity.
The study "finds that the damages are even greater than previously thought," said Kelly Sims Gallagher, an associate professor of energy and environmental policy at Tufts University's Fletcher School, in the MIT announcement.
The researchers calculated these long-term impacts using atmospheric and economic modeling tools, which were especially important when it came to assessing the cumulative impact of ozone. They said China has only recently begun to monitor ozone , and it's become the world's largest emitter of mercury, carbon dioxide and other pollutants.
In the 1980s, they said China's particulate-matter concentrations were at least 10 to 16 times higher than the World Health Organization's annual guidelines. Even after major improvements, by 2005, they said the concentrations were still five times higher than what is considered safe and led to 656,000 premature deaths in China each year.
China is taking steps to mitigate air pollution, in partly by boosting its support for renewable energy sources such as wind and solar. Its hefty subsidies to its solar industry have prompted some U.S. manufacturers to file a complaint with the International Trade Commission. In January, the nation set a target to reduce its 2010 levels of carbon intensity (the amount of carbon emitted per unit of gross domestic product) 17% by 2015.
By Josh Max
It’s official – we don’t want cars that get 200 or more miles to the gallon, and it’s consumers’ fault, not automakers’.
A new report issued by Massachusetts Institute of Technology economist Christopher Knittel says major innovations in miles-to-the-gallon have been stymied by cars that are larger and more powerful than they were 30 years ago.
Between 1980 and 2006, the average gas mileage of vehicles sold in the United States increased by slightly more than 15 percent — a relatively modest improvement, says Knittel. “But during that time, the average weight of those vehicles increased 26 percent, while their horsepower rose 107 percent. All factors being equal, fuel economy actually increased by 60 percent between 1980 and 2006.” If cars had stayed the same weight and size since 1980, says Knittel, we’d all be getting an average of 73 MPG instead of our current average of 27.
“Most of that technological progress has gone into [compensating for] weight and horsepower,” he says, adding that we ought to make drivers cough up for their own pollution.
“When it comes to climate change, leaving the market alone isn’t going to lead to the efficient outcome,” Knittel says. “The right starting point is a gas tax.”
Knittel conducted his study by using data from auto trade journals, manufacturers and data from the National Highway Transportation Safety Administration, which revealed that Americans have chosen to buy larger, less fuel-efficient vehicles over the last 30 years despite far more public awareness of pollution, global warming and other serious environmental issues. In 1980, for example, light trucks accounted for about 20 percent of passenger vehicles sold in America. By 2004, light trucks, including SUVs, accounted for 51 percent of sales.
And despite current national gas prices being higher than they’ve ever been in the history of the internal combustion vehicle - $3.48 per regular gallon - gas prices dropped by 30 percent when adjusted for inflation between 1980 and 2004, Knittel says. The blame, he says, lies with the consumer, not the seller.
“I find little fault with the auto manufacturers, because there has been no incentive to put technologies into overall fuel economy,” Knittel says. “Firms are going to give consumers what they want, and if gas prices are low, consumers are going to want big, fast cars. I think 98 percent of economists would say that we need higher gas taxes.”
By: Richard Harris
Listen to the story.
SOURCE: Keith Srakocic/AP
The boom in cheap natural gas in this country is good news for the environment, because relatively clean gas is replacing dirty coal-fired power plants. But in the long run, cheap natural gas could slow the growth of even cleaner sources of energy, such as wind and solar power.
Natural gas has a bad rap in some parts of the country, because the process of fracking is not popular. But many people looking at cheap natural gas from the global perspective see it as a good thing.
Henry Jacoby, an economist at the Center for Energy and Environmental Policy Research at MIT, says cheap energy will help pump up the economy.
"Overall, this is a great boon to the United States," he says. "It's not a bad thing to have this new and available domestic resource." He says cheap energy can boost the economy, and he notes that natural gas is half as polluting as coal when it's burned for electricity.
"But we have to keep our eye on the ball long-term," Jacoby says. He's concerned about how cheap gas will affect much cleaner sources of energy. Wind and solar power are more expensive than natural gas, and though those prices have been coming down, they're chasing a moving target that has fallen fast: natural gas.
"It makes the prospects for large-scale expansion of those technologies more chancy," Jacoby says.
Natural Gas: 'A Bridge To Nowhere'?
From an environmental perspective, natural gas could help transition our economy from fossil fuels to clean energy. It's often portrayed as a bridge fuel to help us through the transition, because it's so much cleaner than coal and it's abundant. But Jacoby says that bridge could be in trouble if cheap gas kills the incentive to develop renewable industry.
"You'd better be thinking about a landing of the bridge at the other end. If there's no landing at the other end, it's just a bridge to nowhere," he says.
In the short run, at least, the wind industry isn't too worried about this. Denise Bode, who heads the American Wind Energy Association, says low gas prices don't undercut current prices for wind, because those are mostly fixed by 20-year contracts, not market prices.
And even if wind is a bit more expensive than natural gas, she says utilities still want it in their mix. Windmills aren't subject to changing fuel prices, so the cost of production is quite predictable. That's not true for natural gas — there's no guarantee that today's cheap prices will stay as low as some predict.
"It's very difficult to really know how certain that is, so you always want to balance that with something that is certain," Bode says.
Reducing Political Will For Renewables?
What really worries her isn't natural gas — it's politics. Wind could lose a huge tax break at the end of this year. And that would have a much more dramatic effect than low natural gas prices.
"You'll see very low numbers" for new wind installations if the federal production tax credit expires," Bode says. "In fact, I think EIA [the U.S. Energy Information Administration] projects almost zero for 2013."
The solar industry's subsidies run for several more years, so they are not in that bind, at least not yet. But Trevor Houser, an energy analyst at the Rhodium Group, says these tax credits and other incentives like state renewable standards are key if renewables are to grow and mature during the natural-gas glut.
"Long-term renewable deployment in the U.S. is going to depend primarily on policy," Houser says. "Is there enough concern about environmental consequences to put in place incentives for renewable energy?"
That partly depends on how much of a premium people and companies will be willing to pay for cleaner energy. Right now, with natural gas so cheap, that premium is fairly substantial.
"If those prices hang around for another three or four years, then I think you'll definitely see reduced political will for renewable energy deployment, " Houser says. "But we don't expect prices that low to hang around that long, because low prices are in many ways self-correcting."
Gas is so cheap now that companies that produce it are struggling to make a profit. So Houser expects prices to move up. That will help close the price gap between gas and renewable energy.
Even so, there's still a huge way to go before prices and government policies do enough to significantly reduce emissions of the gases that contribute to global warming.
SOURCE: AP
Shale gas has transformed the U.S. energy landscape in the past several years—but it may crowd out renewable energy and other ways of cutting greenhouse gas (GHG) emissions, a new study warns.
A team of researchers at Massachusetts Institute of Technology used economic modeling to show that new abundant natural gas is likely to have a far more complex impact on the energy scene than is generally assumed. If climate policy continues to play out in the United States with a relatively weak set of measures to control emissions, the new gas source will lead to lower gas and electricity prices, and total energy use will be higher in 2050.
Absent the shale supply, the United States could have expected to see GHG emissions 2 percent below 2005 levels by 2050 under this relatively weak policy. But the lower gas prices under the current shale gas outlook will stimulate economic growth, leading GHG emissions to increase by 13 percent over 2005. And the shale gas will retard the growth of renewable energy's share of electricity, and push off the development of carbon capture and storage technology, needed to meet more ambitious policy targets, by as long as two decades.
"Shale gas is a great advantage to the U.S. in the short term, for the next few decades," said MIT economist Henry Jacoby, lead author of the new study. "But it is so attractive that it threatens other energy sources we ultimately will need."
A New Resource
Shale gas relies on hydraulic fracturing, or fracking, to open up cracks in the rock layer deep underground. The high-volume water fracking, combined with horizontal drilling, allows abundant natural gas production from rock layers that had not yielded natural gas in economic volumes before.
In just five years, the supply from shale gas has soared to become a quarter of all U.S. natural gas production. If this production continues to expand, natural gas prices will remain relatively low for decades, and natural gas will take over more of the electricity market, according to the study's forecast, published in the inaugural issue of Economics of Energy and Environmental Policy. (The peer-reviewed semi-annual journal is a new venture of the International Association for Energy Economics.)
The study compared two different kinds of climate policies, and two different situations—with or without shale gas.
In the weak climate policy scenario that the researchers examined, the government would mandate that, by 2030, renewable energy such as wind and solar would grow to become 25 percent of the electricity market, and half of all coal power plants would be shut down.
In the strong climate policy case, greenhouse gas emissions would be required to shrink continually, dwindling to about half today's level by 2050, driven by a price on these emissions, either through a tax or market-based policy to cap emissions.
Either way, the presence of abundant shale gas would make it cheaper to meet the targets, the study found.
"The biggest effect is that it would push out coal," Jacoby said. This is a climate benefit, because natural gas generates electricity with roughly half the emissions of coal.
However, the expansion of shale gas would also put limits on the expansion of other sources of electricity, because natural gas power plants would tend to be cheaper than wind or solar.
In the strong policy scenario, the study forecasts that natural gas would take over about a third of the electricity market by 2050, completely driving out coal. In this case, renewable energy would increase as well, tripling between now and 2050—but this growth of renewables would be much slower than what the U.S. has seen in the past several years.
Low-cost gas would also hamper the development of carbon capture and storage (CCS), a way of keeping carbon dioxide, the primary greenhouse gas, from going up power plants' smokestacks, and instead storing it underground.
According to the study, if there were no shale gas, meeting the stronger policy target would first bring CCS into play around 2030, and then it would expand to become a crucial part of the electricity system. But with shale gas available, CCS is projected to be pushed back by up to two decades.
"In the long run, we need renewables, carbon capture and storage, and nuclear power," Jacoby said. "Shale gas is a good thing overall, but we've got to keep our eye on the long term,"—beyond 2050.
Cost, Technology Uncertainty
One reason that it is important to spur development of alternative energy and carbon capture is that there is a lot of uncertainty about the future of shale gas, said Jacoby, who co-authored a major MIT study last year on the subject.
"We're at the very early stage of this resource," Jacoby said. "It's a huge resource, but the main uncertainty is the cost."
That's in part because "we're just learning about the geology [of shale gas areas] and how wells will perform over time," Jacoby said.
New environmental regulations may also put restrictions on the industry, pushing up the cost of production. And as the prime reserves of shale gas are depleted, the gas from remaining reserves may be more expensive to produce.
On the other hand, there has been rapid technological improvement in fracking, Jacoby said, "so we'll get better and better at it," which could help keep the price down.
A Blessing or a Trap?
Physicist Ray Orbach, director of the Energy Institute at the University of Texas in Austin, agrees that shale gas in the coming years will be cheap and plentiful enough to drive out most other sources of electricity—including coal, nuclear, and renewables.
"It's a little hard to see how any other source can compete for the foreseeable future," Orbach said.
But Orbach, who oversaw federal research efforts as director of the Office of Science at the U.S. Department of Energy in the Bush administration, added, "I think it's a very healthy competition," since it will drive out coal, the dirtiest source of electricity, both in terms of greenhouse gases and smog. Rather than shale gas being a problem, he said, "it's a blessing."
However, James Bradbury, a policy analyst at the World Resources Institute, said energy policymakers face new challenges due to shale gas.
"Given current U.S. policies, abundant and relatively cheap natural gas puts all other energy sources at a competitive disadvantage," he said. "It is particularly important for decision-makers to . . . usher in more renewable energy by creating incentives to help this industry thrive," including policies to increase innovation and encourage investment in electric grids.
The infrastructure people build today—power plants fired by coal or natural gas, or solar panels or wind turbines—will likely last for decades, Bradbury said.
"The longer it takes for the [United States] to pass climate policy," he added, "the more likely it is that we will see . . . gas-related infrastructure become effectively locked in to our energy system for decades."
The MIT study noted that natural gas is often thought of as a "bridge" to a low-carbon future. But the study also emphasizes that there is also a risk of "stunting" other technologies for reducing carbon emissions. "While taking advantage of this gift in the short run, treating gas as a 'bridge' to a low-carbon future," the study said, "it is crucial not to allow the greater ease of the near-term task to erode efforts to prepare a landing at the other end of the bridge."
Automakers have made great strides in fuel efficiency in recent decades — but the mileage numbers of individual vehicles have barely increased. An MIT economist explains the conundrum.
By: Peter Dizikes, MIT News Office
Contrary to common perception, the major automakers have produced large increases in fuel efficiency through better technology in recent decades. There’s just one catch: All those advances have barely increased the mileage per gallon that autos actually achieve on the road.
Sound perplexing? This situation is the result of a trend newly quantified by MIT economist Christopher Knittel: Because automobiles are bigger and more powerful than they were three decades ago, major innovations in fuel efficiency have only produced minor gains in gas mileage.
Specifically, between 1980 and 2006, the average gas mileage of vehicles sold in the United States increased by slightly more than 15 percent — a relatively modest improvement. But during that time, Knittel has found, the average curb weight of those vehicles increased 26 percent, while their horsepower rose 107 percent. All factors being equal, fuel economy actually increased by 60 percent between 1980 and 2006, as Knittel shows in a new research paper, “Automobiles on Steroids,” just published in the American Economic Review (download PDF).
Thus if Americans today were driving cars of the same size and power that were typical in 1980, the country’s fleet of autos would have jumped from an average of about 23 miles per gallon (mpg) to roughly 37 mpg, well above the current average of around 27 mpg. Instead, Knittel says, “Most of that technological progress has gone into [compensating for] weight and horsepower.”
And considering that the transportation sector produces more than 30 percent of U.S. greenhouse gas emissions, turning that innovation into increased overall mileage would produce notable environmental benefits. For his part, Knittel thinks it is understandable that consumers would opt for large, powerful vehicles, and that the most logical way to reduce emissions is through an increased gas tax that leads consumers to value fuel efficiency more highly.
“When it comes to climate change, leaving the market alone isn’t going to lead to the efficient outcome,” Knittel says. “The right starting point is a gas tax.”
Giving the people what they want
While auto-industry critics have long called for new types of vehicles, such as gas-electric hybrids, Knittel’s research underscores the many ways that conventional internal-combustion engines have improved.
Among other innovations, as Knittel notes, efficient fuel-injection systems have replaced carburetors; most vehicles now have multiple camshafts (which control the valves in an engine), rather than just one, allowing for a smoother flow of fuel, air and exhaust in and out of engines; and variable-speed transmissions have let engines better regulate their revolutions per minute, saving fuel.
To be sure, the recent introduction of hybrids is also helping fleet-wide fuel efficiency. Of the thousands of autos Knittel scrutinized, the most fuel-efficient was the 2000 Honda Insight, the first hybrid model to enter mass production, at more than 70 mpg. (The least fuel-efficient car sold in the United States that Knittel found was the 1990 Lamborghini Countach, a high-end sports car that averaged fewer than nine mpg).
To conduct his study, Knittel drew upon data from the National Highway Transportation Safety Administration, auto manufacturers and trade journals. As those numbers showed, a major reason fleet-wide mileage has only slowly increased is that so many Americans have chosen to buy bigger, less fuel-efficient vehicles. In 1980, light trucks represented about 20 percent of passenger vehicles sold in the United States. By 2004, light trucks — including SUVs — accounted for 51 percent of passenger-vehicle sales.
“I find little fault with the auto manufacturers, because there has been no incentive to put technologies into overall fuel economy,” Knittel says. “Firms are going to give consumers what they want, and if gas prices are low, consumers are going to want big, fast cars.” And between 1980 and 2004, gas prices dropped by 30 percent when adjusted for inflation.
The road ahead
Knittel’s research has impressed other scholars in the field of environmental economics. “I think this is a very convincing and important paper,” says Severin Borenstein, a professor at the Haas School of Business at the University of California at Berkeley. “The fact that cars have muscled up rather than become more efficient in the last three decades is known, but Chris has done the most credible job of measuring that tradeoff.” Adds Borenstein: “This paper should get a lot of attention when policymakers are thinking about what is achievable in improved automobile fuel economy.”
Indeed, Knittel asserts, given consumer preferences in autos, larger changes in fleet-wide gas mileage will occur only when policies change, too. “It’s the policymakers’ responsibility to create a structure that leads to these technologies being put toward fuel economy,” he says.
Among environmental policy analysts, the notion of a surcharge on fuel is widely supported. “I think 98 percent of economists would say that we need higher gas taxes,” Knittel says.
Instead, the major policy advance in this area occurring under the current administration has been a mandated rise in CAFE standards, the Corporate Average Fuel Economy of cars and trucks. In July, President Barack Obama announced new standards calling for a fleet-wide average of 35.5 mpg by 2016, and 54.5 mpg by 2025.
According to Knittel’s calculations, the automakers could meet the new CAFE standards by simply maintaining the rate of technological innovation experienced since 1980 while reducing the weight and horsepower of the average vehicle sold by 25 percent. Alternately, Knittel notes, a shift back to the average weight and power seen in 1980, along with a continuation of the trend toward greater fuel efficiency, would lead to a fleet-wide average of 52 mpg by 2020.
That said, Knittel is skeptical that CAFE standards by themselves will have the impact a new gas tax would. Such mileage regulations, he says, “end up reducing the cost of driving. If you force people to buy more fuel-efficient cars through CAFE standards, you actually get what’s called ‘rebound,’ and they drive more than they would have.” A gas tax, he believes, would create demand for more fuel-efficient cars without as much rebound, the phenomenon through which greater efficiency leads to potentially greater consumption.
Fuel efficiency, Knittel says, has come a long way in recent decades. But when it comes to getting those advances to have an impact out on the road, there is still a long way to go.
A group of MIT-affiliated cyclists hope to fuel themselves from New York to Washington in a few weeks to raise awareness -- and money -- for climate change initiatives. The nine graduate students, researchers and friends are all planning to take part in the Climate Ride 2008, a five-day, 320-mile ride from the Big Apple to the nation's capital that symbolizes the nation's need to get out of the car.
Says policy-making requires ambitious short-term goals.
Long-term climate change policy in the United States and abroad is likely to change very slowly, warns an MIT professor who says the lack of future flexibility argues for stronger short-term goals to reduce carbon emissions.
Coordinated by the U.S. Department of Energy, this Synthesis and Assessment 2.1 report is titled Scenarios of Greenhouse Gas Emissions and Atmospheric Concentrations, and Review of Integrated Scenario Development and Application, and provides a new long-term, global reference for greenhouse gas stabilization scenarios and an evaluation of the process by which scenarios are developed and used.
DOE Press Release
Today's release of a widely anticipated international report on global warming coincides with a growing clamor within the United States to reduce greenhouse gas emissions and prevent the potentially devastating consequences of global climate change. "There's clear evidence that greenhouse gases have been increasing by very large amounts since preindustrial times, and the vast majority of these increases are due to human activity," said Prinn, whose specific task on the panel was to assess this issue.
There's one basic answer to the question, Why are we worried about energy? The answer is climate change, argues MIT's Ron Prinn: if there were no global warming threat associated with fuels like oil and coal, there'd be no crisis.
