The American Lung Association just released their 2009 State of the Air Report. To see the results for Indiana, visit http://www.stateoftheair.org/2009/states/indiana/

The following is an excerpt from their Executive Summary:

"Air pollution continues to threaten the lives and health of millions of people in the United States despite great progress since the modern Clean Air Act was first passed in 1970. Even as the nation explores the complex challenges of global warming and energy, air pollution remains widespread and dangerous.

"This year marks the tenth annual American Lung Association State of the Air report and provides an excellent opportunity to look back over the changes in the past ten years. This 2009 report looks at ozone and particle pollution year-round (annual average) and over short-term levels (24-hour) of particle pollution (PM2.5) found in monitoring sites across the United States in 2005, 2006, and 2007."

Fossil fuel generation is coming under increasing scrutiny as alternatives gain acceptance with Wall Street financial institutions.

In a revolutionary statement issued by three major investment houses last week, Citigroup, JP Morgan Chase and Morgan Stanley released their “Carbon Principles” and “Enhanced Diligence Process.” They consider these to be global warming “guidelines for advisors and lenders to power companies in the United States.”

Citigroup released a statement to the media declaring: “… [I]f high carbon doxide-emitting technologies are selected by power companies, banks have agreed to follow the Enhanced Diligence process and factor these risks and potential mitigants into the final financing decision.” Indeed, the clear implication, as pointed out by Environmental Leader’s executive’s daily green briefing, is that coal plants without carbon capture and sequestration will be highly frowned upon.

Yet this is the road down which Indiana is heading. Two plants have been proposed without carbon capture and carbon sequestration: Duke Energy’s proposed coal gasification plant at Edwardsport and Indiana Gasification LLC, the ultimate location of which is anyone’s guess.

Not only are the design of these plants completely irresponsible from an ecological standpoint, they are miserable financial investments. The only way they can be built is with massive outlays of ratepayer and taxpayer dollars. State legislation already passed, and more now under consideration (Senate Bill 223 and House Bill 1117), would force the construction of these less than astute investments with ratepayer and taxpayer dollars. CAC suggests that Duke and Lucadia (the east cost firm attempting to construct Indiana Gasification LLC) drop the machinations to make ratepayers and taxpayers financial cannon fodder for enhancing their profit margins with sham investment strategies and listen to the rational voices among the public and private investment community.

The rational approach put forth by the Wall Street investment firms is energy efficiency first followed by renewable energy and less polluting decentralized power generators like combined heat and power projects at industrial facilities. The more risky investments like coal and nuclear are last in the hierarchy. Why put energy efficiency and renewable energy first? Because, unlike investments in coal and nuclear plants, they are ultimately less risky investments, create more jobs, and address global warming in an economically viable way.

The bottom line is that the new generation of coal plants is not financially viable and researching and developing carbon capture and sequestration technology for new or existing plants with ratepayer dollars, as envisioned in HB 1117, will cost billions of dollars, a price tag Indiana ratepayers can ill afford.

Many homeowners are unhappy with their property tax bills. If HB 1117 or SB 223 passes, their utility bills will soon rival or exceed their tax bill, if not the case already. Providing utility service with financially sound resources like energy efficiency and renewable energy is paramount for addressing our economic and environmental needs.

Grant Smith
CAC Executive Director

Carbon Caps with Universal Dividends: Equitable, Ethical & Politically Effective Climate Policy

January 2008
John Bailey
New Rules Project
www.newrules.org

"Common to many proposals addressing climate change is a cap on carbon emissions or carbon content of fuels. A cap will generate a market value for carbon. A key issue is who will receive this value. Many agree that there should be a 100 percent auction of carbon permits, but there many opinions about how to disburse the money gained from selling these permits. This paper argues for a universal, equal dividend returned to each person.

"A nationwide auction of carbon allowances conservatively could raise $50 - $200 billion annually or about $1 billion to $4 billion per year at the state level in Minnesota (at the higher level, this represents about 15 percent of annual state government spending).

"A universal dividend makes a carbon cap ethical, equitable and politically effective.

"Ethical – If the sky is owned by all humanity equally, then any value created from carbon caps should be distributed in equal amounts to everyone.

"Equitable – A cap on carbon will raise the price of energy and energy intensive goods and services. A universal dividend will especially help low and middle income households absorb and manage those cost increases. Indeed, lower income households, on average, should receive back more in dividends than they pay in higher prices for fuels and products.

"Politically Effective – Per capita dividends will enhance public acceptance of a carbon cap by largely or completely offsetting the negative economic impacts on tens of millions of households. In the early years of the cap, the price of carbon (along with energy and most consumer products) will increase as we establish a market price that will encourage supplies and manufacturers to substitute existing energy sources for low carbon fuels. But since the dividends rise as the value of carbon rises, the net impact on most households will be small."

Click here to download the PDF and read the entire document: http://www.newrules.org/de/carboncaps-dividends.pdf

For more statistics:

Coal consumption (per capita) (most recent) by country

Coal Consumption (per capita) (most recent) by state

Map of U.S. coal consumption by state

An assessment of the state of climate change in the United States
January 28, 2008

"As the United States begins the eighth year of the 21st century, the most dangerous and difficult challenge of our time remains largely unaddressed. Global climate change continues unabated. The United States is the nation that is most responsible for the problem and most capable of helping to solve it. Yet today, our nation stands virtually alone in the world community in refusing to accept the need for decisive action.

"Consequently, we regret to report that today the state of the nation’s climate policy is poor, and the climate and the ecosystems that depend upon it are showing increasing signs of disruption. Global climate change now threatens not only the environment, but also our national security, our economic stability, and public health and safety. We can no longer discuss the State of the Union without assessing the state of the nation’s climate.

"The growing consequences of climate change have not arrived without warning. Physicist John Tyndall first identified the greenhouse effect in the 1860s. Swedish geochemist Svante Arrhenius predicted in 1896 that the burning of fossil fuels would result in global warming.

Click here to download the PDF and read the entire document: http://www.citact.org/pdfs/State_of_the_Climate_1-4-08.pdf