Ways & Means is a weekly column by Mark Alan Hughes on economics, politics and sustainability in Philadelphia.
Everyone has a to-do list for President Obama’s second term. I’ve got some ideas of what he can do for sustainability, climate policy and cities. But — spoiler alert — cities will continue to lead on these issues for at least two reasons: They are sources of innovation and they are motivated by immediate impacts, not abstract arguments. So my own list begins with Obama but it ends with Nutter, Bloomberg, Emanuel and Villaraigosa.
First, I gotta put my science cards on the table, which I don’t do very often. Folks have different ways of coping with climate science, and I’m in the scared-but-hopeful category. Unfortunately, the hope comes from my DNA, while the scared part comes from mountains of facts, like this week’s report from PricewaterhouseCoopers. It features nuggets like these:
Business leaders have been asking for clarity in political ambition on climate change. Now one thing is clear: businesses, governments and communities across the world need to plan for a warming world — not just 2°C, but 4°C, or even 6°C.
This year we estimated that the required improvement in global carbon intensity to meet a 2°C warming target has risen to 5.1% a year, from now to 2050. We have passed a critical threshold — not once since World War 2 has the world achieved that rate of decarbonisation, but the task now confronting us is to achieve it for 39 consecutive years.
Even to have a reasonable prospect of getting to a 4°C scenario would imply nearly quadrupling the current rate of decarbonisation.
Pretty sobering stuff, coming as it does from an accounting firm advising business clients on risk. An increase of 2 degrees Celsius (about 4 degrees Fahrenheit) in global temperature is the threshold used by most scientists and governments for dangerous climate change. See this post for a TED talk on the science and politics of thresholds.
But now a 4 C/7 F increase has become a likely outcome by as early as the 2060s, during the expected lifetime of my teenage children. It’s harder to avoid thinking about the consequences when you live with people who will to confront them. As one 2011 article put it in the science journal Philosophical Transactions of the Royal Society:
In such a 4°C world, the limits for human adaptation are likely to be exceeded in many parts of the world, while the limits for adaptation for natural systems would largely be exceeded throughout the world.
“Limits for human adaptation are likely to be exceeded” is a scientific way of saying, “we die.”
But the good news is that we still have time to avoid this future, at least for another few years. It is not a puzzle to solve, but a decision to make. California has already made it: The state’s Global Warming Solutions Act of 2006 (AB32) and Executive Order S-3-05 require California to reduce its greenhouse gas emissions to 80 percent below 1990 levels by 2050, while accommodating projected growth in its economy and population. A report shows that Cali can get to 60 percent by deploying known solutions, and can invest now to learn how to get those last 20 points to the 80 percent goal by 2050.
If we all could do like California, the world could stay on the safe side of the climate change thresholds. Of course, it’s natural to say that California is the best-case scenario and that we can’t all be the best. But actually, it works just the other way. The state has been squeezing more and more energy for productive uses for 30 years now, relying on virtually no coal for its power generation. And yet, California has determined that it can still achieve its ambitious goals to do even more, even after a generation of hugely successful effort. That means the rest of us could achieve those same goals much more easily, because we haven’t done all that easier stuff yet.
But getting started on that easier stuff still faces political, not technical, challenges. Right now, carbon-based energy producers make bigger profits — and carbon-based energy consumers pay smaller bills — because the cost of all that carbon pollution warming the climate is being sloughed off to the health care system to deal with asthma and cancer, and to the disaster relief system to deal with crop failures and infrastructure failure.
In order to make polluters pay and make energy affordable to all, we need a carbon tax along the lines being discussed, ever so tentatively, in Washington. A recent Congressional Research Service report has suggested that a $20 per ton tax on carbon emissions (rising 5.6 percent each year) would generate $90 billion in its first year and reduce the 10-year budget deficit from $2.3 trillion to $1.1 trillion, or from 1.1 percent to 0.5 percent of GDP. Not all of that revenue should go to deficit reduction, because some is needed to cushion lower-income households and higher carbon businesses from the tax. But combined with ending the Bush tax cuts on households earning more than $250,000, a national carbon tax could address lots of our challenges at once.
So that’s what we need the president to deliver from Washington. But as is the case on issue after issue, cities can push the limits on both innovation and action.
I’ll conclude by translating the carbon tax idea and impact into a language that mayors speak. Buildings account for two-fifths of our energy consumption, much of which is wasted through leaky windows, poor insulation and weak incentives to act individally. Mayors can deploy the property tax mechanism to drive down that waste by rewarding better performing buildings.
This can be done in a variety of ways: A credit or abatement of taxes for buildings that score better on some performance measure, like EnergyStar, or an energy audit. Even better would be a feebate approach in which poor performing buildings pay a higher tax and well performing buildings pay a lower tax that just balances, meaning the plan is revenue neutral overall. Best of all, with an on-bill payment system, building owners could make investments to avoid the higher taxes if they chose. In Philadelphia, where the City is fortunate to own the gas and water utilities, the opportunities for a coordinated policy are enormous.
The idea is the same as the national carbon tax: To put the true cost and benefit of energy into the budgets of decision makers like building owners. Doing so is the single biggest step that the president can take to deploy a sustainable future. Smart mayors can help him get there.
Mark Alan Hughes teaches at PennDesign and was Philadelphia’s founding director of sustainability.
Mark Alan Hughes is a Distinguished Senior Fellow at PennDesign and an Investigator at the US Department Of Energy’s Energy Efficient Buildings Hub at the Philadelphia Navy Yard. He is a Faculty Fellow of the Penn Institute for Urban Research, a Senior Fellow of the Wharton School’s Initiative for Global Environmental Leadership, and a Distinguished Scholar in Residence at Penn’s Fox Leadership Program. He has been a senior fellow at the Brookings Institution, the Urban Institute, and a senior adviser at the Ford Foundation. He was the Chief Policy Adviser to Mayor Michael Nutter and the founding Director of Sustainability for the City of Philadelphia, where he led the creation of the Greenworks plan. Hughes holds a B.A. from Swarthmore and a Ph.D. from Penn, joined the Princeton faculty in 1986 at the age of 25, has taught at Penn since 1999, and is widely published in the leading academic journals of several disciplines, including Economic Geography, Urban Economics, Policy Analysis and Management, and the Journal of the American Planning Association, for which he won the National Planning Award in 1992.