Here’s a very good little video from SmartPlanet.com, a CBS Interactive website.

For more, see my posts here on Carbon Markets.

I had the good fortune to be involved with some very smart activists back in the 1980s who were working on acid rain.  One of these was the Environmental Defense Fund’s senior scientist Michael Oppenheimer.  Michael’s been at Princeton for a number of years and among his many projects, he co-curated the compelling climate change exhibit at the American Museum of Natural History.  He and Nathaniel Keohane, EDF’s Director of Economic Policy and Analysis, wrote a cogent case for cap-and-trade here at the Huff-Po a couple of weeks ago.  Their four main reasons:  environmental certainty; international opportunity; the market, not the government, sets the price; and political viability.  See their explanation of how these play.

This article is a terrific complement to Robert Stavins’s article, The Wonderful Politics of Cap-and-Trade: A Closer Look at Waxman-Markey, that I referenced here at the end of May.  (See under The Wonk Zone.)

To get a sense of the history of cap-and-trade, you can read this succinct and absorbing story at Smithsonian Magazine in which “an unlikely mix of environmentalists and free-market conservatives” worked together to create the mechanism that radically reduced the North American acid rain problem.  Cap-and-trade now stands poised to do so much of the really heavy lifting on reducing greenhouse gases.

Deutsche Bank yesterday unveiled an enormous display outside New York’s Madison Square Garden/Penn Station complex.  What’s it show?  “The current quantity of long-lived greenhouse gases in the atmosphere as shown by the Carbon Counter is 3.64 trillion metric tons, increasing by approximately 2 billion metric tons per month,” according to DB’s release.  “‘The Carbon Counter is a bold new experiment in communicating climate science to the public,’ said Ronald Prinn, Professor of Atmospheric Science, MIT.”

“BNET Energy” further reports that DB has an interest, as do growing legions of investors, entrepreneurs, and bankers, in using the instruments available to us now to get emissions down.  “The company, as of March 2009, has about $4 billion under management involving climate change. Its assets include renewable energy projects in Europe and as well as a climate change fund that invests in companies involved in clean technology, energy efficiency and environmental management.  Deutsche Bank’s portfolio is merely a snapshot of the emerging climate change industry.  The carbon trading market - for example - has grown from $727 million in 2004 to $118 billion in 2008, according to a report released last month by SBI. Global carbon markets will grow 68 percent a year to $669 billion in 2013, the market research company forecasted.”

Deutsche Bank has, as noted, a series of sustainable enterprises.  Read more about them at their website, Banking on Green.  For access to the Carbon Counter on a continual basis, click here.

Photo by Brandon Barrett, courtesy of Deutsche Bank.

I hope to sit in on a couple of local events here in NYC in the next couple of weeks.  The first is Carbon Finance North America 2009, June 11 and 12.  The keynote speaker is Eileen Claussen, President of the Pew Center on Global Climate Change, and there will be worthy panelists from government, the private sector and from NGOs.  There will be plenty of discussion and insight into federal climate and energy legislation and Obama administration initiatives, what to expect from Copenhagen, what the investment communities are interested in and what projects they’re pursuing, and the prospects for fully integrating sustainability into the economic architecture of the future.

Another event that’s coming up is GreenBuildingsNY, June 16 and 17.  All of the major building supply companies will be exhibiting in what will likely be a pretty eye-opening experience.  This is being produced in part by GreenerBuildings.com, a consistently excellent resource.

That’s how I’d paraphrase the old Bill Clinton internal campaign motto in the context of the present-day campaign to get an American law into place to combat GHGs.  I’ve written about cap-and-trade and the Carbon Markets dozens of times here, including on the cap-and-trade vs. carbon tax debate.  For an interesting look at the history of this debate, see this “NY Times” article from the other day.  What you need to know about the support for cap-and-trade is that it “…has been embraced by President Obama, Democratic leaders in Congress, mainstream environmental groups and a growing number of business interests, including energy-consuming industries like autos, steel and aluminum.”

Paul Krugman has another great column today on the subject.  What you have to remember about Krugman, aside from his being a progressive commentator and a Nobel laureate in economics, is that he’s a teacher.  He’s got a gift for explaining abstruse concepts like….well, cap-and-trade.  What I remind my students is that the most important word in the phrase is “cap.”  I tell them that Fred Krupp, president of the Environmental Defense Fund, said, in speaking of the last President, that he “…has refused to accept the only path that’s ever solved an air pollution problem - and that’s mandatory legal limits.”  With a cap, we can steer toward a quantifiable diminution in GHG emissions.  That’s what we need and that’s what we can get.

Krugman says that Waxman-Markey “…would limit greenhouse gases by requiring polluters to receive or buy emission permits, with the number of available permits - the ‘cap’ in ‘cap and trade’ - gradually falling over time.”  One of the objections from environmentalists with the present state of the bill is that it gives away too many of the permits, rather than auctioning all of them as President Obama and most environmental groups would prefer.  But Krugman, as I often do, tells us not to make “…the perfect the enemy of the good.”

Even with some allocation of free permits, we’re still going to be moving significantly toward lowering our GHG output.  “Now, these handouts wouldn’t undermine the policy’s effectiveness. Even when polluters get free permits, they still have an incentive to reduce their emissions, so that they can sell their excess permits to someone else.”  It’s worked on the acid rain precursor, sulfur dioxide, and it will work for carbon dioxide.

Not incidentally, if you think the American public doesn’t want this, as some folks would have you think, well that dog just don’t hunt.  See Americans support climate action: Polls from carbonpositive, an Australian-based news service and agro-forestry enterprise.  See also this from “US News & World Report.”  77 percent of voters favor action.

Those polled reflect the views of nearly all environmentalists, climate scientists, and hundreds of millions of others around the planet.  Winston Leonard Spencer Churchill put it this way:  “I never worry about action, but only inaction.”

That’s the title of Paul Krugman’s column today at the “NYT.”  As I’ve been saying here, that sure seems to be the gestalt of the Obama administration and the new Congress when it comes to energy, the environment and climate change.  Krugman says here, among other things, “…it’s also heartening to see that the budget projects $645 billion in revenues from the sale of emission allowances. After years of denial and delay by its predecessor, the Obama administration is signaling that it’s ready to take on climate change.”

So what else does the budget tell us?  Along with the economic stimulus package and the tax credits from the Emergency Economic Stabilization Act of 2008, there’s all sorts of love for renewables, energy efficiency, the smart grid, mass transportation and other sane and sound public policy initiatives.  Krugman’s colleague, John Broder, has this breakdown on the “green” aspects of the budget. As Krugman notes, there’s ample revenue from cap-and-trade.  What’s more:  “Under the plan, 100 percent of pollution permits will be auctioned, meaning no sector of the economy will be exempted from paying for the right to emit carbon dioxide and other gases that contribute to global warming. This is consistent with Mr. Obama’s campaign pledge, and it is a matter of fierce debate.”  You can say that twice!

Reuters’s headline is Obama budget realistic on climate revenue: analysts.  “The $646 billion figure, spread over eight years, presumes that a U.S. law to limit carbon emissions will be in place by 2012, and Obama has said he will work with Congress to make this happen.”  Barbara Boxer has said she wants a bill out this year.  Harry Reid and Nancy Pelosi are singing from the same hymnal.  See more on the political status of cap-and-trade here from Bloomberg.

This lucid and succinct document from OMB, Jumpstarting The Economy And Investing For The Future, lays out some of the initiatives:

• Initiate A New Federal Commitment To High-Speed Rail
• Begin A Comprehensive Approach To Transform Our Energy Supply And Slow Global Warming
• Provide The Capital To Double Renewable Energy Generating Capacity
• Develop Low-Carbon Emission Technologies
• Modernize Federal Buildings And Slash The Federal Government’s Energy Bill By 25 Percent
• Weatherize Low-Income Homes - Saving Working Families On Average $350 Per Year
• Green Our Nation’s Farms
• Modernize The Electric Grid

What’s not to love?  One possible problem:  various localities may not be ready for this cornucopia.  See Preparing for a Flood of Energy Efficiency Spending, again from the “NYT.”  (Hey, I read a lot of different publications and websites and, frankly, the “NYT” is on it.  The Grey Lady has got some excellent reporting on many of the myriad ins and outs of energy, the environment and climate change.)

In any event, so are our friends in the Obama Administration:  On it, that is.

Senate Environment and Public Works Committee Chair Barbara Boxer had a press conference earlier this week, as I noted under Keeping Up the Pace in the post just below. I watched some of it today on C-Span while I was having lunch. In the press conference, Boxer, along with Democratic colleagues from the committee, outlined what the principles are going to be for climate change legislation.

Amy Klobuchar from Minnesota mentioned that the energy technology revolution is going to be very different from the information technology revolution in that the jobs are going to be available at different education levels, not just for folks with graduate degrees in computer science, and throughout the country, not just for people in Silicon Valley and other IT hotspots. (Go to minute 47:00 in the webcast.) Boxer further illustrated the importance of green jobs with examples of how California's requirements for energy efficiency and renewables are helping to bring some relief to the dire employment situation there.

New Senator Jeff Merkeley of Oregon said VC, research institutes, and many others are waiting for a price on carbon that will pull them into the market. (Go to 48:45 at the webcast.) This precisely echoes the underlying sentiment of Fred Krupp and Miriam Horn's "Earth: The Sequel": Innovation will flourish in response to economic incentives. See also Merkeley's release this week on green jobs and investment. He says, regarding the economic stimulus package before Congress, "This bill creates jobs now and lays the foundation to once again harness America's innovative know-how and lead the world in development and production of exciting new technologies. I'm especially pleased this bill focuses so much attention on capturing the new economic opportunities of green energy."

Finally, Boxer was asked about Cap-and-Trade vs. Carbon Tax and said, unequivocally, it's going to be cap-and-trade. Why? Because Europe and others are already doing it, the Western States and the Northeast are doing it, Obama has said that's the way to proceed, and she wants legislation to be consonant with what the rest of the world is doing. She further noted the successes that cap-and-trade produced on acid rain here in the US.

Here's what I wrote at this post nearly two years ago on that score:

One of the progenitors of the "cap-and-trade" system that allows polluters to accumulate "credits" is Environmental Defense, back when they were the Environmental Defense Fund. The system was conceived with sulfur dioxide in mind. Acid rain is largely a consequence of sulfur dioxide emissions from electrical and industrial power plants. The push for this system to be deployed within the acid rain title of the Clean Air Act reauthorization was led by EDF. See "The Cap and Trade Success Story" from Environmental Defense. Very interestingly to me, at yesterday's symposium, Peter Koster, CEO of the European Climate Exchange, said that after Kyoto when the Europeans were looking for compliance mechanisms, they were urged by Clinton and Gore to adopt a "cap-and-trade" system because of the success of the acid rain program in the U.S.

[Note:  The FPA has upgraded its blog software and the font is going to be this one from here on out for my posts.  We'll no doubt get used to it quickly.] 

Obama takes steps to reverse Bush climate policies is the headline from Reuters. For one thing, the new President has instructed the EPA to revisit California’s application to institute carbon dioxide limits on motor vehicles sold there. (See California Standards here.) See also this from the “Washington Post” today, including the video of Obama’s announcement in which he said, among other things, “The days of Washington dragging its heels are over.”

He also ordered the Department of Transportation to accelerate the schedule for bringing new fuel-efficient cars into the market, as required by the federal energy bill from December 2007.

The “WaPo” also reported that “Separately, the State Department is expected to name Todd Stern, formerly a senior official in the Clinton administration, as the new U.S. envoy on climate change.  Here is the introduction by Sec. of State Hillary Rodham Clinton and remarks from Stern - text and video.

Stern is a senior fellow at the Center for American Progress and, as such, has been instrumental in developing policy recommendations that the new administration has been embracing. At the core of this is the transformation to a low-carbon economy with all the potential for jobs and development that that can mean. See Capturing the Energy Opportunity: Creating a Low-Carbon Economy from the CAP.

Opportunity continues to be one of my favorite words.

Here’s CAP’s video on their plan.

The Answer, My Friend - Wind Farm Off Cape Cod Clears Hurdle is the story from the “NY Times” the other day.  As you know, offshore wind projects have been hurtling forward in Europe, but have lagged years behind in the US.  The Cape Wind project generated an extraordinary and largely unforeseen backlash when it was proposed in 2001.  While the opposition has gone through its paces, other projects have come to life on the Atlantic Coast , see Offshore Wind in the Northeast.  With the green light for Cape Wind from the Interior Department’s Minerals Management Service, the developer, Jim Gordon, says he thinks construction can begin late this year and he can get power up and flowing by the end of 2011.  Score one big one for the Environment over NIMBY.

Soot - When Rajendra Pachauri addressed the Asia Society (see last post below), he had a little video from TERI on its “Lighting a Billion Lives” project.  This aims to employ solar PV to power lanterns all over rural India.  What I would have liked to ask him was how TERI and others are addressing the cooking smoke that causes such extraordinary damage to health throughout the developing world and, very much not incidentally, exacerbates global warming.  See Black Carbon and Solar Cookers.

An article the other day from “The Independent” highlighted new research on the importance of reducing particulate pollution.  A study by NASA’s Goddard Institute for Space Studies “shows that cutting down on the pollutant, which has so far been largely ignored by climate scientists, can have an immediate cooling effect , and prevent hundreds of thousands of deaths from air pollution at the same time.”

“The Independent” has great coverage on climate change.  For many more stories, go here.

“Lawful Excuse” - Here’s a story I missed from September, also reported in “The Independent.”  Owing to a wonderful quirk of British law, activists from Greenpeace, who caused more than £35,000 worth of damage to a coal-fired power station, successfully argued that ” they had acted lawfully, owing to an honestly held belief that their attempt to stop emissions … would prevent further damage to properties worldwide caused by global warming.”

Jim Hansen, head of the Goddard Institute, testified at the trial.  As reported here, Hansen called for ” an immediate moratorium on new coal-fired power plants that do not capture or sequester CO2.”  According to the article, there is some dissension in the highest reaches of the British cabinet about how to proceed on these plants.

(See also Coal Takes Some Lumps and Baby, It’s Coal Outside from the blog for more on how coal-fired plants are hitting the wall here in the US of A.)

Climate Law - Speaking of the law, here’s another positive development:  Center For Climate Change Law Launched At Columbia reads the release from Columbia Law School.   Mike Gerrard, one of the premier environmental lawyers and environmental law thinkers in the country, is heading up this new effort.  As we move ahead with a federal cap-and-trade regime, and get closer to a comprehensive international agreement, climate law is going to be center stage.  Columbia University is well placed to help develop the law and the lawyers to execute it.

Essay Competition - As my FPA colleague, Cassandra Clifford reported the other day at her excellent blog on Children, the World Bank has a competition for students on the essay subject:  “How Does Climate Change Affect You?”  Go here for more.

Carbon Market Burgeoning - Point Carbon, a superb ” provider of independent news, analysis and consulting services for European and global power, gas and carbon markets,” had an eye-catching release last week:  “4.9Gt CO2e traded in 2008 , up massive 83% on previous year.”  It’s subtitle was equally arresting:  “Carbon market worth almost €100bn in 2008, more than double 2007’s figures.”  Not chopped liver.  As we move forward with mandatory carbon regimes in the US, Europe and elsewhere, these numbers are going to skyrocket.  See any number of my posts on the Carbon Markets for more on what could be the world’s most-traded commodity in just a few years hence.

Crops that Fight Warming - Here’s an item from Reuters that jumped off the screen at me:  Sun-reflecting crops could ease global warming.  One of the researchers is quoted as saying “We found that different varieties of most food crops do differ in how much solar energy is reflected back to space.”  This is a promising approach for a number of reasons, including the relatively low cost of switching over to crops with higher reflective properties and the possibility that farmers could receive carbon credits.

I issued the “FPA Climate Change Challenge” over a year and a half ago here.  I wrote “Who’s got a good idea?  Okay, I’ll start this off.  Are you ready?  Since light color reflects heat efficiently (albedo effect), then why don’t we start breeding white grass and get people to accept this for their lawns and golf courses?  We should also use these on roofs.”  Now I know I’m not daft.

There are always all sorts of meetings, conferences, conventions and other gatherings ongoing.  Here are a few worthy of note.

Governors' Global Climate Summit , The Governator, California Governor Arnold Schwarzenegger, will host US governors and some top international policymakers on climate change and energy in LA next week.  Governors taking part in this event include Charlie Crist from Florida, Jim Doyle from Wisconsin, Rod Blagojevich from Illinois, and Kathleen Sebelius from Kansas.  Schwarzenegger, not incidentally, has been mentioned as a possible Obama administration Energy Secretary and Sebelius has been mentioned for EPA.  This looks to be an exciting conference.  It's being webcast by UCTV so if you can't make it out to LA, tune in here or visit later for archival video.

By the way, the Foreign Policy Association's sister organization, the World Affairs Councils of America, is helping get the word out. 

G20 , Tomorrow in Washington, world leaders will start to gather for meetings to address the global economic crisis.  See Many Seats, Agendas At Global Roundtable from the "Washington Post."  President-Elect Obama, although invited, will not be there.  What the meetings hope to achieve, I'm not really certain, even though it's being billed as "Bretton Woods II."  I doubt anybody really thinks it's going to be quite that.  In any event, see some comprehensive coverage here from the "FT."

As far as the climate change crisis goes, you should check out this excellent piece from the Worldwatch Institute - Opinion: Building A Green Economy.  Here's a capsule of their view:  "The perfect storm of today's economic, environmental, and social ravages requires a robust, multi-pronged response. Indeed, the challenge for global political leadership, including U.S. President-elect Obama, is not merely to kickstart the global economy, but to do so in a way that creates jobs and stabilizes climate, increases food output using less water and pesticides, and generates prosperity with greater equality of incomes."

Carbon Market Insights Americas 2008 , This is a terrific conference going on in Washington this week.  It's being coordinated by Point Carbon and the Pew Center on Global Climate Change, both superb organizations in the forefront of the action.  (I would've loved to have made this conference, but I had other cats to whip, as the French say so disarmingly.)

The Point Carbon folks have two reports which you can get from them:  Carbon Markets and the Incoming US Leadership and Business Opportunities in the Carbon Market.  Regarding the former, they say they "expect Obama's presidency to bring with it increased momentum toward the establishment of mandatory carbon markets in the US."

Here is some of their thinking behind the second report:  "Regional programs across North America would potentially create markets with a volume close to 900 million tons by 2012 , almost half the size of the EU Emissions Trading Scheme (ETS).  At a conservative price of $10 per ton of carbon dioxide, this would open up billions of dollars worth of transactions and considerable business opportunities."

As Everett Dirksen said, "A billion here, a billion there.  Pretty soon you start talking about real money!"