Thursday, October 1, 2009

Addressing biofuel GHG emissions in the context of a fossil-based carbon cap

What follows is the abstract of an in-depth discussion paper that reflects an early stage of my re-evaluation of lifecycle analysis methods for fuels policy. 

Renewable fuels have been promoted as a climate solution as well as for their energy security and domestic economic benefits. Analysts often assume that, other than process emissions, biofuels emit no net CO2 because their biogenic carbon was recently absorbed from the atmosphere. This "renewability shortcut" has shaped both public perception and public policy to date. Cap-and-trade policies follow GHG inventory conventions that use the shortcut and so fail to properly account for biofuel emissions. They also miss portions of the upstream GHG emissions from fossil-based transportation fuels, although most such emissions are trade related.

Lifecycle analysis (LCA), which attempts to account for all of the GHG impacts associated with fuel production, has been proposed as a means of regulating fuels for climate policy. LCA is used to qualify certain fuels for the U.S. federal renewable fuel standard (RFS) and also forms the basis of a low-carbon fuel standard (LCFS). However, as LCA system boundaries have expanded to address market effects such as induced land-use change, its application in policy has become controversial.

This paper examines these issues, quantifies GHG emissions missed by cap-and-trade policies as commonly proposed, and identifies ways to address biofuel emissions in the context of a carbon cap that covers major emitting sectors. Resource economics suggests that policy should be defined by annual basis accounting of carbon stocks and flows and other GHG fluxes rather than by LCA. This perspective suggests the use of a three-part approach: (1) correct specification of the transportation sector point of regulation with careful carbon accounting at the point of finished fuel distribution; (2) voluntary fuel and feedstock GHG accounting standards to track CO2 uptake and uncapped GHG emissions throughout the fuel supply chain; and (3) a land protection fund for purchasing international forest carbon offsets to mitigate leakage.

While an RFS can remain in place to drive volumes of specified fuels into the market, this approach avoids the need for either LCA requirements in the RFS or the added regulatory layer of an LCFS. Integrated into a cap-and-trade framework, this market-based approach would provide biofuel and feedstock production with a carbon price incentive tied to the cap, creating a more complete carbon management framework for the transportation fuels sector.

Citation and link: 

DeCicco, J.M. 2009. Addressing Biofuel GHG Emissions in the Context of a Fossil-Based Carbon Cap. Discussion Paper prepared for the Environmental Defense Fund. Ann Arbor: University of Michigan, School of  Natural Resources and Environment, October.

Monday, March 2, 2009

Lutz loved cars but never got it on green

The environmental world came to know General Motors vice chairman Bob Lutz as the cigar­chomping, jet-flying skeptic of global warming as well as the visionary product boss who introduced the Chevy Volt and became an unlikely affirmer of GM’s effort to go green.
General Motors' Bob Lutz and his Aero L-39 Albatros
(via Jalopnik)

That “Maximum Bob,” who represents what calls the end of an era, would be a bundle of contradictions should come as no surprise.

The best of design is often about creatively blending opposing concepts into a harmonious whole. Lutz is right-on about the importance of outstanding, customer-focused car design, but off base in thinking that green directions kill the emotional factor.

Lutz bemoaned what he sees as a depressing new period of government oversight driven by pressures for higher fuel economy and lower CO2 emissions. In an Associated Press interview, Lutz said that the new era “doesn’t really play to my greatest skills, which were perhaps more in the intuitive, emotional area with sort of a sense for what the market would want.”

No, it’s not Lutz’s talent that is out of step; it’s his worldview.

Lutz epitomizes the “Old Detroit” in terms of ecological attitudes, a cohort of corporate leaders who rose to the top eerily disconnected from the parallel rise of environmental values in American culture. 

For whatever reasons, most U.S. auto executives saw green only as inherently “anti-car” rather than as a chance to redefine the car for a future world that is very different than that of their formative years.

Bill Ford was criticized for trying, even though he had a good sense of what was ahead a few years before it arrived to catch his peers off guard.

The Old Detroit zeitgeist remained in deep denial across the turn of the century, even as Honda and Toyota brought practical hybrids to market, soon followed by 9/11, mounting fears of the end of oil, melting glaciers in Lutz’s Swiss homeland, and then escalating — and last summer spiking — gasoline prices. 

All of those factors and then some will meld into the still unfolding but emotive formulas that define what sells in the years ahead. Lutz himself seemed to get this when, remarking on the growing success of hybrids during the 2005 Detroit auto show, he said: “We forgot about the emotional impact and the fact that a lot of people out there want to make an environmental statement.” In short, customer-oriented intuition will be needed more than ever. 

Thus, it’s not Lutz’s core skill that is passé; rather, it’s his mindset about what is already starting to be valued by a new generation of car buyers. Being in sync with changing market sensibilities is utterly crucial for a financial recovery that can only be product-driven. 

Coloring passion green: the Chevrolet Volt
(General Motors)
The Chevy Volt also reflects the notion that meeting the environmental challenge mainly entails costly technology. 

Lutz is being succeeded by Thomas Stephens, GM’s head of global powertrain engineering. The Wall Street Journal writes that Stephens is “well-versed in what goes on under the hood, which is precisely where GM and other U.S. automakers have to play catch-up with some foreign rivals.” 

While what’s under the hood has a role to play — as it had for the muscle-car era — success won’t only or even mainly be found in technology. The PR blitz that GM has built around the Chevy Volt may be a hint of realization that serious sales hooks can be colored green. However, it’s not yet clear that they’re connecting all the dots, which critics point out may take a retooling of corporate culture much deeper than one futuristic product can provide. 

Lutz himself undertook at least the start of such retooling as he enlivened GM’s mainstream product strategy. 

So, as Bob Lutz fires up his after­burners to paint one last exhaust plume across the evening sky, perhaps a new car guy (or girl) is being cultivated inside GM. That person might be tattooed and body-pierced but will surely be well wired to the world around us. And if he or she has a Lutzian passion for product, the company will have hope for a new era. 

Editor's note: This piece first ran under the heading "Lutz loved cars, but never quite got passion for green" on page A12 of The Detroit Free Press, Monday, March 2, 2009. Although its original link went dead, the piece may yet lurk in the Freep's archives.