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The American Energy Odyssey: Lessons from the Past Decade (2005-2015) Barry G. Rabe University of Michigan March 5, 2015

The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

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Page 1: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

The American Energy

Odyssey: Lessons from the Past

Decade (2005-2015) Barry G. Rabe

University of Michigan

March 5, 2015

Page 2: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

Then As Now…

“The Americans can always

be trusted to do the right

thing, once all other

possibilities have been

exhausted.”

—Winston Churchill*

Page 3: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

US Greenhouse Gas Emissions (1990-2012) Excludes Emissions from Land Use, Land-Use Change, and Forestry

Source: CRS, EPA

Page 4: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

US Energy Consumption by Source (1990-

2013)

Source: CRS, EIA

Page 5: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

American Views on the Existence of Evidence of Global

Warming 2008-2014 : NSEE 2014

0%

10%

20%

30%

40%

50%

60%

70%

80%

Yes No Not Sure

“Is there solid evidence that the average temperature on earth has been

getting warmer over the past four decades?”

Page 6: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

Views on the Existence of Evidence of Global Warming, by

Partisan Affiliation: NSEE 2014

0%

10%

20%

30%

40%

50%

60%

70%

80%

Democrats Republicans Independents

Yes No Not Sure

“Is there solid evidence that the average temperature on earth has been

getting warmer over the past four decades?”

Page 7: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

2009: A New Direction from the Executive

Branch; Can Congress Respond?

“I call upon this Congress to send me legislation that places a

market-based cap on carbon pollution and drives the

production of more renewable energy in America.”

—President Obama

Page 8: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

2015: Another New Direction from Congress

Image from ABC News

Page 9: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

State Domination: Renewable Portfolio

Standards—Durable So Far

Renewable Portfolio Standard

Renewable Portfolio Goal

Information from DSIRE

Page 10: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

State Experimentation Not-So-Durable:

Cap-and-Trade in 2003

Page 11: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

State Diffusion: Cap-and-Trade 2008

Page 12: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

State Retrenchment: Cap-and-Trade 2015

Page 13: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

Image from Naplesnews

Enter Contested Federalism:

LET’S MAKE A DEAL

Page 14: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

Clean Power Plan: States Begin to Respond

Go to Court

~14

Texas, Wisconsin

Go Slow

~22

Pennsylvania, Virginia

Let’s Go

~14

California, New York

Page 15: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

Public Reaction to the Clean Power Plan:

NSEE Fall 2014

0%

10%

20%

30%

40%

50%

Overall Democrat Republican Independent

Strongly oppose Somewhat oppose

Somewhat support Strongly support

Page 16: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

Public Opinion: How do you want your state

to respond to the Clean Power Plan?

0%

10%

20%

30%

40%

50%

60%

Overall Democrat Republican Independent

Cooperate and enter into negotiations with the federalgivernment on a planDelay until more is known about the plan and see how otherstates respondRefuse to cooperate and join other states in suing thefederal government to block the plan

Page 17: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

Public Opinion: Support for the federal

“building block” options for Clean Power Plan

compliance?

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Q32: Allowing businesses to buy and sell permits torelease greenhouse gases to reduce greenhousegases. This policy is commonly referred to as cap

and trade.

Q31: Increasing taxes on ALL fossil fuels used ingenerating electricity in order to reduce greenhouse

gas emissions.

Q30: Requiring increased energy efficiencystandards for new homes and appliances in your

state.

Q29: Requiring a set portion of all electricity tocome from renewable energy sources such as wind

and solar.

Oppose Support

Page 18: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

So what about the shale boom?

Image from EcoNews

Page 19: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

State Domination: How Do MS States Respond

to Shale?

No Go

New York, Vermont

Go Slow

Maryland, Michigan, Illinois,

Virginia

Let’s Go

North Dakota, Pennsylvania,

Texas

Page 20: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

State vs. Local Authority: Who Makes the Call?

Page 21: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

Greetings from Bismarck:

“World-Class” or “Regulatory Capture”?

Page 22: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

Greetings from Juneau: Is Boom Going Bust?

Page 23: The American Energy Odyssey - Ivey Business School · 2015. 4. 1. · gases. This policy is commonly referred to as cap and trade. Q31: Increasing taxes on ALL fossil fuels used in

Enduring American

Governance Challenges

Durability of lame-duck executive actions

Decline in capacity of any Congress and any President to

agree on anything (Now worse than: “It’s Worse Than It

Looks”)

Divides in states are increasingly partisan

Dollars fuel perpetual campaign cycles (2nd year of 2016

election)