In the United States, too often we think of the Caribbean as a very nice place to visit. Throughout our history, though, it has been far more important. Last week, ASP released a report looking at the unique challenges of energy security in the Caribbean. This will be the first of a series of articles showing the challenges faced in the region by energy insecurity, why that is important, and give some solutions.
The islands of the Caribbean have always been too small to control their own geopolitical destinies – they are blown by winds far from their shores: colonialism, slavery, or the Cold War.
Around the Caribbean was where the Monroe Doctrine, designed to keep Europeans from interfering in the Americas, was tested throughout the nineteenth and early twentieth centuries. It was where the U.S. first learned that it could be a regional and then global power on the world stage.
On Wednesday in Beijing, President Obama and his Chinese counterpart Xi Jinping announced a series of agreements at a surprisingly fruitful APEC summit. The US and China came to agreements on issues as diverse as military relations, trade, investment, visas, and a range of other issues. Certainly, the Chinese are not acting like they’re dealing with a U.S. President hobbling into a lame-duck period.
The biggest agreement, however, comes in the area where President Obama still has a great amount of power, both domestically and internationally, to take action: climate change. This is also an area where action by the Chinese government both has meaning for a domestic constituency and among the international community. While observers had expected some sort of deal on climate change, the scope and ambition of the deal were a surprise. Last year, I had written that “U.S. – China Agreement on Climate Shows Promise” – and with this announcement, we see that the promise is on its way to bearing fruit.
Of course, we can only judge the effectiveness of any deal on climate change over a long horizon. This deal does appear, though, to put both the US and China – and the rest of the world with them – on a track to beginning to actually meet the challenges of climate change.
The Terms of the Agreement: Ambition on Both Sides
Under the deal, the United States will cut emissions 26 to 28 percent below 2005 levels by 2025, while China agrees that its emissions will hit a peak and begin declining by 2030 at the latest, while also increasing its share of non-fossil energy to 20 percent in that same period. The White House claims its emissions cuts can be met “under existing law” (so, no need for Congressional action) and China, meanwhile, will deploy up to 1,000 gigawatts (a terawatt) of new nuclear, wind, solar and other zero-emissions generation to meet its goal. The targets are there, and so are the means.
The Republicans have won a clear victory. They will take over the Senate, expand their control of the House, and deserve congratulations for their win.
Now, it is time to govern. The challenges that this country faces are long. And governing is different than campaigning. It means dealing with problems as they come – and not always in what fits best in a 30 second advertisement.
After this election, climate change is an issue that Republicans may think they are safe to ignore. The President has made a big push to regulate carbon emissions through the EPA over the last two years. Some outside groups sought to bring climate action into the campaign. Today, the electoral results could not be more clear: Obama’s policies were repudiated at the polls. Throughout the election, Democrats in swing districts went out of their way to avoid talking about climate change or the EPA.
Republicans could think that they are safe to continue saying “I’m not a scientist” when asked about climate change. They could think this means they don’t need a climate policy. That would be the wrong lesson to take from this.
President Obama’s policies on climate change are all wrong. His Department of Energy picks winners and losers among politically connected companies. His command-and-control policies at the EPA will ensure that “no lawyer is left behind” in a flurry of lawsuits over where to build power plants, and what kind of production is allowed.
On Monday, September 22, I took part in the Climate Group’s annual kick-off of “Climate Week NYC.” We heard from political leaders like Secretary of State John Kerry, Executive Secretary of the UNFCC Christiana Figueres, French Foreign Minister Laurent Fabius, and Ban Ki-moon the Secretary General of the UN. ASP helped arrange Secretary Kerry’s climate speech, which is worth reading in its entirety.
As someone working on climate policy in Washington, I’ve heard from these speakers on these issues before. Their leadership is important; we cannot effectively address climate change without political action – but it is not novel.
Likewise, when the UN climate summit meets at UN headquarters on Tuesday, September 23, the over 120 heads of state will prove significant in providing the national leadership that will set standards and provide direction for how to address climate change in both UN negotiations and at their national level.
It appears that the war between Ukraine and Russian-backed separatists may now be coming to an end, as a cease fire agreed on September 5 looks (increasingly) durable.
However, the end of the war does not mean the end of the struggle. Western policymakers must beware of complacency. Once CNN, the BBC, and the New York Times have gone home and NATO’s leaders have turned their attention to the next global flashpoint (Iraq, as it looks to be), we know that the Russians will test Ukraine. They will test the Ukrainian people’s desire to remain truly independent. They will test the Ukrainian leadership’s ability to turn down the comforts and corrupt spoils that working with Russian businesses has brought to former leaders. They will test the West’ attention span and commitment. CONTINUE»
… We Should be More Ambitious
Licensing exports of natural gas would help American diplomacy – but this is not really about the gas, it is about American support for free trade. Since the end of World War II, the U.S. has been the world’s champion in creating a free, global trading system. The U.S. is a beneficiary of the global, open trading system and it is not in our interest to restrict trade.
The debate in the U.S. has become solely focused on natural gas exports because the Obama Administration has been negligent about promptly approving gas export licenses and opaque about the process and requirements for approving the backlog of applications. This restriction should be lifted because it tarnishes the free-trade credentials of the United States.
However, this debate must be about more than just natural gas exports. Recent statements by some Members of Congress portray U.S. natural gas exports as a “weapon” against Russia, but this overstates the influence that U.S. energy can have on this crisis in Ukraine.
Even if the U.S. government approved every export terminal application currently pending and if construction times and costs were reduced to zero, instantly giving the U.S. new Liquefied Natural Gas (LNG) export capacity, we would not see that much gas flowing to Europe because geopolitics also have to work with economics. Remember, this is not the U.S. government sending gas to Ukraine or the EU as economic aid: this is a private exchange between businesses. Because the demand for LNG is much higher in Asia, where prices are as much as double the price in Europe, we should not expect to see many tankers full of gas sailing to Europe any time soon.
I have seen a number of commentators over the last few days say that the American shale gas revolution means that the U.S. could simply announce new LNG exports and that would undercut Russian gas. House Energy and Commerce Committee Chairman Upton, for instance, said in a statement: “Expanding U.S. LNG exports is an opportunity to combat Russian influence and power, and we have an energy diplomacy responsibility to act quickly.”
Statements like this overstate the influence that U.S. energy can have on this crisis Ukraine. While it is true that a viable, functioning LNG export capacity would provide geopolitical benefits, we do not have it today and we should not think that the U.S. energy boom will help in this crisis.
The U.S. energy boom has already helped reduce Russia’s influence and increased European energy security, without a singe molecule of US Natural Gas landing on the continent. This is because, even if the United States does not directly supply Europe with oil or natural gas, because the U.S. no longer is demanding imports of liquefied natural gas (LNG) has freed up major suppliers like Qatar or Norway to send supplies to Europe.
Andrew Holland writes about how Europe can change Russia’s behavior by embargoing imports of Russian natural gas.
The production of oil and natural gas in the United States is booming. Next week, the American Security Project, where I am the Senior Fellow for Energy and Climate Policy, is releasing the 2014 edition of our “America’s Energy Choices” report (if you’re in DC, come to our event on Tuesday morning, January 28 for breakfast! RSVP here). Since we first began writing this report in 2011, there has been a sea change in the production of fossil fuels in the U.S.- particularly oil. This article builds off that report and a paper we are releasing detailing the “Five Energy Choices America Needs to Make.” CONTINUE»
A couple of weeks ago I had the opportunity to tour the Liquefied Natural Gas (LNG) facility at Cove Point, Maryland. Owned by Dominion, the Cove Point facility is currently an LNG import and storage facility.
As readers will know, there has not been that much demand for LNG imports to the U.S. over the last few years – the shale gas revolution has turned the U.S. from an economy looking to import increasing quantities of costly gas to one where a surplus of low-cost gas is looking to global exports. As such, Dominion has applied for the permits to expand the facility for LNG export. It has received approval from the Department of Energy for exports, but it is awaiting state, local, and final FERC approval before construction can begin. They expect to break ground on the new facility in the spring of 2014, with completion sometime in 2017.
A Brief History
When Cove Point was first built in the late 1970s, there was demand for imported gas from the only major supplier of LNG, Algeria. The 1970s had seen shortages of gas around the country. As it came on line in 1978, Congress passed legislation to deregulate the gas industry. With deregulation, domestic production increased and demand for imported LNG fell and most imports ceased by 1980. In the early 2000s, there was pressure in natural gas markets again, and Cove Point was reactivated as an import terminal in 2003. In ‘04 and ’05, Cove Point hosted almost 80 ships per year bringing in LNG from producers around the world. At that time, U.S. demand looked set to grow inexorably, with domestic supplies unable to meet demand. So, in 2004, Dominion embarked on a large expansion of Cove Point’s capacity, more than doubling its storage capacity. Once completed in 2009, markets had again turned against LNG imports, as the shale revolution pushed down prices and pushed up production. 2011 was the last commercial import of LNG; now two or three ships per year service the facility in order to keep their lights on and fulfil their secondary mission of providing a peak demand service (providing gas to markets in times of high demand).