On the Issues: Geopolitics of Critical Minerals, Wildfire Risk to Private Property

Twice a month, we’re compiling the most relevant news stories from diverse sources online, connecting the latest environmental and energy economics research to global current events, real-time public discourse, and policy decisions. Keep reading, and feel free to send us your feedback.

Here are some questions we’re asking and addressing with our research chops this week:

How do critical minerals, which are essential for electric vehicle batteries, intersect with US policy?

How does the growing risk of wildfires affect housing prices in areas where the risk is higher?

How can communication between policymakers and researchers help bring clarity to efforts to decarbonize the industrial sector?

Expert Perspectives

US Environmental Protection Agency Steps Back Major Regulations on Greenhouse Gas Emissions

A proposed regulation to limit greenhouse gas emissions from US power plants will no longer include existing natural gas plants, according to Michael Regan, who leads the US Environmental Protection Agency (EPA). The agency also is expected to weaken another proposed regulation on tailpipe emissions from new vehicles.

“The initial regulation on tailpipe emissions that EPA proposed would have required automakers to reduce emissions from new vehicles by almost 60 percent by 2032,” says Beia Spiller, a fellow at RFF and director of RFF’s Transportation Program. “To reach that goal, EPA expected that almost 70 percent of new vehicles sold in the United States by 2032 would’ve had to be electric vehicles. Now, the expectation is that EPA will give automakers more time to increase the share of electric vehicles they sell. Time will tell whether the weakened regulation will create sufficient incentives for automakers to innovate and create more affordable electric vehicles in the short run.”

“Now, if EPA doesn’t make any further changes, the regulation on greenhouse gas emissions from power plants would be limited in its application to existing coal plants and new natural gas plants,” says Karen Palmer, a senior fellow at RFF and director of RFF’s Electric Power Program. “The agency plans to propose a new regulation for greenhouse gases and other air pollutants from existing natural gas plants, but we probably won’t see a proposal until well after the November election. Existing natural gas plants generated over 40 percent of US electricity in 2023, so these facilities are a major source of emissions from the power sector.”

“That EPA did not want to regulate existing natural gas plants in the first place was widely reported, so the decision to revert to that position is interesting,” says RFF Fellow Aaron Bergman. “Regulating the existing natural gas fleet poses a lot of challenges, and I can see why EPA would like more time. Many groups also had concerns that the proposed regulations, which apply to just a fraction of the natural gas fleet, were not strong enough. While EPA may be able to issue stronger regulations in the future, any regulations will have to be after the election, and, for now, this change will lead to increased greenhouse gas emissions.”

Mark Your Calendar!

Digging Deep: Critical Minerals, Electric Vehicles, and the Role of Innovation

Tuesday, March 12, 4:00–5:00 p.m. Eastern Time: Critical minerals are necessary for the production of batteries for electric vehicles (EVs). Given the growing demand for EVs, these batteries could become more expensive, which could slow the production of EVs and the reduced emissions that result from replacing gas-powered vehicles on the road. Join RFF for this webinar about markets for critical minerals, EV adoption, and how technological innovation can help meet the challenges of a growing demand for EVs. RSVP to attend the webinar.

Strategies for Decreasing Construction Emission in Cities

Tuesday, March 12, 2:00–3:15 p.m. Eastern Time: The construction and operation of buildings contribute around 30 percent of global annual greenhouse gas emissions, and buildings have become a particular area of focus for cities that are working to reduce emissions. Given that decarbonizing cities is a complex challenge, international collaboration can provide an opportunity for cities and builders to learn from existing successes and accelerate the transition to a clean energy economy. Join RFF and the Sweden-US Green Transition Initiative for this webinar about challenges to reducing emissions from the buildings sector, along with potential solutions. RSVP to attend the webinar.

Transportation Engineering, Economics, and Policy

Friday, March 15, 8:30 a.m.–4:00 p.m. Eastern Time: Policymakers will need to make key decisions in the coming years about new transportation technologies and how to implement these technologies, while also taking into account how policies could affect the environment, public health, and social welfare. Join researchers from RFF, the University of Maryland, and Carnegie Mellon University for this workshop on multidisciplinary transportation research and discussions with experts on transportation policy. RSVP to attend the workshop in person.

Global Energy Outlook 2024: Peaks or Plateaus?

Tuesday, April 2, 3:00–4:30 p.m. Eastern Time: RFF’s Global Energy Outlook is an annual report that synthesizes projections and analyses of the global energy market from leading energy organizations and corporations. In this RFF Live event, the authors of the report will present notable findings, and a panel of energy experts will discuss the long-term trajectory of the global energy system, the effects on the global energy market of the Russian invasion of Ukraine, US exports of fossil fuels, and other issues. RSVP to attend the event in person or online.

To learn more about all upcoming and previous workshops, webinars, and other events, visit RFF’s Events page.

Resources Roundup

Unpacking the Justice40 Initiative

Under the Biden administration, the federal government has set the goal of channeling at least 40 percent of the benefits from federal climate investments to disadvantaged communities. Guidance for this goal comes from the administration’s Justice40 Initiative. On Wednesday, March 6, RFF hosted an event with a panel of experts and community leaders to discuss the priorities of the Justice40 Initiative, along with how implementation of the initiative is faring. “State and local governments across the country are leading the way … and are also being inspired by the Justice40 framework, because they understand its inherent values,” said Monisha Shah, Deputy Director for Justice40 and Environmental Justice Innovation.

Assessing the Options for Federal Climate Policy in 2025

2025 may be an important year for climate policy in the United States. Many provisions in the Tax Cuts and Jobs Act of 2017 are set to expire, which may place Congress and the White House at a crossroads for funding existing climate policy and potentially passing new legislation. Catherine Wolfram, a member of RFF’s Board of Directors, and James Stock, an RFF university fellow, have coauthored a new working paper that evaluates a range of climate policy options that could be adopted by the federal government in 2025, pending the results of the November election.

How Policies and Clean Technologies Can Help Drive Industrial Decarbonization

The industrial sector accounts for around one-third of annual global greenhouse gas emissions, so decarbonizing industry is crucial for meeting global climate goals. In a recent episode of the Resources Radio podcast, Jeffrey Rissman, a senior director at Energy Innovation, discusses how policymakers and new technologies can help decarbonize various industrial subsectors, including steel and cement making. “Policy is critical to driving adoption of cleaner technologies on a faster timescale, making these investments by industry profitable, helping create jobs, and securing the technological leadership for the industries that invest in them,” says Rissman.

Evaluating the 45V Tax Credit for Clean Hydrogen

Hydrogen fuel can replace fossil fuels or help reduce the need for fossil fuels in various industries, such as steelmaking and fertilizer production. However, most hydrogen currently is produced in a way that emits a large amount of carbon dioxide. A provision in the Inflation Reduction Act, known as the 45V tax credit, subsidizes the production of hydrogen through processes that emit low or no emissions, which can help reduce emissions from the industrial sector—but implementation of the tax credit has become complicated. The US Department of the Treasury proposed guidance on the implementation of 45V in December and recently finished accepting comments from the public. RFF Fellow Aaron Bergman, who has written extensively on US hydrogen policy, submitted a comment to the agency.

#ChartOfTheWeek

Critical minerals, such as the cobalt and lithium used in the production of batteries for electric vehicles, have to undergo processing before they can be used for manufacturing. The expertise and technology that are necessary for processing take time and require hefty investments, and firms in some nations, like China, have achieved majority shares of the global market for processing critical minerals through long-term industrial planning and policy. Nations that may not want to rely on China as a trading partner have limited options, among them: find other trading partners, play catch-up on processing capacity, or innovate. “A crucial policy component for helping address [uncertainties around the future availability and cost of critical minerals] is supporting new battery technologies through research and development, including the pursuit of designs that substitute other materials for the critical minerals that have fewer stable supplies,” say the authors of a new Common Resources blog post.