Natural Gas in EPA’s Plan
Analysis that accompanied EPA’s Clean Power Plan predicts that “natural gas [will] edge out coal to become the most common fuel for power plants by 2030.” The EPA says that this could have significant environmental benefits because “natural gas emits about 40 percent less carbon than coal for the same amount of energy.”
There will be economic benefits as well, according to RFF researchers. In a recent blog post, RFF’s Alan Krupnick writes: “With the new plan, the demand for natural gas will increase even more. In the old days, this would have led to big increases in costs and prices to bring that gas to market. But the shale gas revolution has changed all that.” Research by Krupnick, RFF’s Stephen P.A. Brown, and Margaret Walls on the cost of a similar plan “shows that the natural gas revolution can shave a [a billion dollars] off of the plan’s cost.”
Insuring against Climate Change
Recently, a major insurance company dropped the lawsuits it filed against Chicago municipalities who it says are failing to prepare for climate change. The company argued that the cities and suburbs have been aware of the increasing impact of global warming on regional rainfall “since the 1970s” and that the lawsuits were intended to “encourage cities and counties to take preventative steps to reduce the risk of harm in the future.”
At a recent RFF seminar (video now available), experts questioned whether disaster events that are exacerbated by climate change and globalization are becoming increasingly uninsurable. RFF Fellow Carolyn Kousky noted that “insurability is a dynamic concept that changes over time,” requiring risk management tools that can accommodate levels of financial and scientific uncertainty to keep insurance profitable for its writers and affordable for its buyers. (Related: See “How Much Do Weather-Related Disasters Cost?” for Kousky’s examination of the costs and why they are increasing.)
