On June 1, 2023 the Department of Environmental Conservation (DEC) and New York State Energy Research and Development Authority (NYSERDA) hosted the first webinar in a series “to inform the public and encourage written feedback during the initial phase of outreach” for New York’s proposed cap and invest program. At the time of this writing the only documentation available for the webinar are the slides so this article only addresses one question. Where does the state stand relative to the 2030 transition target of a 40% reduction of GHG emissions from the 1990 baseline.
I have been following the Climate Leadership & Community Protection Act (Climate Act) since it was first proposed. I submitted comments on the Climate Act implementation plan and have written over 300 articles about New York’s net-zero transition because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good. The opinions expressed in this post do not reflect the position of any of my previous employers or any other company I have been associated with, these comments are mine alone.
Climate Act Background
The Climate Act established a New York “Net Zero” target (85% reduction and 15% offset of emissions) by 2050 and an interim 2030 target of a 40% reduction by 2030. The Climate Action Council is responsible for preparing the Scoping Plan that outlines how to “achieve the State’s bold clean energy and climate agenda.” In brief, that plan is to electrify everything possible and power the electric grid with zero-emissions generating resources by 2040. The Integration Analysis prepared by the New York State Energy Research and Development Authority (NYSERDA) and its consultants quantifies the impact of the electrification strategies. That material was used to write a Draft Scoping Plan. After a year-long review the Scoping Plan recommendations were finalized at the end of 2022. In 2023 the Scoping Plan recommendations are supposed to be implemented through regulation and legislation. The cap and invest initiative is one of those recommendations.
DEC and NYSERDA have developed an official website for cap and invest. It claims:
An economywide Cap-and-Invest Program will establish a declining cap on greenhouse gas emissions, limit potential costs to New Yorkers, invest proceeds in programs that drive emission reductions in an equitable manner, and maintain the competitiveness of New York businesses and industries. Cap-and-Invest will ensure the state meets the greenhouse gas emission reduction requirements set forth in the Climate Leadership and Community Protection Act (Climate Act).
I recently posted my All Otsego Commentary overview on cap and invest published in early May that was written for a non-technical audience. In late March I summarized my previous articles on the New York cap and invest proposal in a post designed to brief politicians about the proposal if you want more technical information. There also is a page that describes all my carbon pricing initiatives articles that includes a section about the New York Cap and Invest (NYCI) proceeding.
NYS GHG Emissions
One of the fundamental issues relative to NYCI is the status of New York State GHG emissions. The DEC is required to prepare an annual report for statewide greenhouse gas emissions, pursuant to Section 75-0105 of the Environmental Conservation Law. The DEC website described the report issued at the end of 2022:
This current report covers the years 1990 through 2020. The emission information will also be made available for download from Open Data NY (leaves DEC website).
- Summary Report (PDF)
- Sectoral Report 1: Energy (PDF)
- Sectoral Report 2: Industrial Processes and Product Use (PDF)
- Sectoral Report 3: Agriculture, Forestry, and Land Use (PDF)
- Sectoral Report 4: Waste (PDF)
- Appendix: CLCPA Emission Factors (PDF)
- The 2022 report includes the results of analyses that are described in more detail in supplemental reports available through the New York State Energy Research and Development Authority (NYSERDA) Greenhouse Gas Emissions Studies (leaves DEC website).
- Instructions for Accessing Statewide GHG Information from Open NY (PDF)
According to the Environmental Protection Agency, one of the necessary components for an effectively designed emissions trading program is “accountability for reducing, tracking and reporting emissions”. While on the face of it the DEC annual GHG emissions report might seem to fulfill that condition, it does not. The DEC annual report takes two years to develop so it is unusable for the proposed program. The data provided are not detailed enough to breakdown emissions by potential NYCI sectors. Finally, there are insufficient supporting data to document the accuracy of the reported emissions.
The impetus for this article is slide 7, GHG Emissions Reduction Requirements, in the presentation. The slide includes two figures: current emissions by sector and New York State GHG emissions. My concern is the numbers used for the figures.
The New York State GHG emissions figure includes three numbers from Part 496 the statewide GHG emission limits for the Climate Act. In 2030 the statewide greenhouse gas emission limit (in million metric tons of carbon dioxide equivalent or MMT CO2e) is 245.87 and in 2050 it is 61.47. Those limits are 60% and 15% respectively of the 1990 baseline emissions which works out to 410 MMT CO2e. The 2019 emissions (376.18 MMT CO2e are from the 2022 GHG emissions inventory. Note that the State uses 2019 instead of 2020 for trends analysis because 2020 values are anomalous due to the pandemic shutdowns.
My concern is that the numbers used to derive the graph “Current estimated GHG emissions by sector are not publicly available. The DEC annual report does not break out emissions from the different sectors by the categories shown. For example, for the buildings sector there is no table that lists space heating, water heating, other, and cooking sub-category emissions. The emission information available from Open Data NY does not include those categories either. The DEC 2022 report references supplemental reports available through the NYSERDA Greenhouse Gas Emissions Studies website. There are no relevant references to emissions from those categories in those reports.
I have been dealing with emissions reporting for cap-and-trade programs for three decades starting with the Acid Rain Program in the early 1990’s. The Environmental Protection Agency standard for the accountability for tracking and reporting emissions is very high. Developing the infrastructure to record, report, and comply with their standards took enormous effort but the data are completely transparent and verifiable to national standards. Note, however, that this high level is only possible because the emissions are measured directly. That approach is not possible for many sectors covered by the Climate Act but it does not mean that there should not be accountability for the emissions.
Instead of directly measuring the pollution emissions at the source, many sectors must rely on emission factors. EPA describes emissions factors as follows:
An emissions factor is a representative value that attempts to relate the quantity of a pollutant released to the atmosphere with an activity associated with the release of that pollutant. These factors are usually expressed as the weight of pollutant divided by a unit weight, volume, distance, or duration of the activity emitting the pollutant (e.g., kilograms of particulate emitted per megagram of coal burned). Such factors facilitate estimation of emissions from various sources of air pollution. In most cases, these factors are simply averages of all available data of acceptable quality, and are generally assumed to be representative of long-term averages for all facilities in the source category (i.e., a population average).
In order to calculate emissions using an emission factor the following equation is used:
E = A x EF x (1-ER/100)
- E = emissions;
- A = activity rate;
- EF = emission factor, and
- ER =overall emission reduction efficiency, %
In order for the NYCI emissions to be accountable, all four of those values should be documented and available to the public. Unfortunately, the state has net even provided the data used to generate the graphics used much less this supporting information.
There is another important difference between the emissions reported based on direct measurements at the source and emissions derived from emission factors. The measured values cannot change but if there are refinements to the emission factors or activity rate measurements the values can change. For example, the 2022 Sectoral Report 1: Energy report has a chapter entitled Planned Improvements that lists known issues where improved estimates are desired. In my opinion, there are numerous examples where the DEC emission factors used are questionable and I expect that affected sources will likely make the investments to improve the emission factors for more realistic emission estimates. There have already been changes such that the Part 496 1990 baseline value of 410 MMT is different than the 2022 GHG emission inventory estimated 1990 emissions of 404.26 MMT.
Where Do We Stand?
In the absence of data from the DEC and NYSERDA that can be used to determine where the sectors stand relative to the 2030 Climate Act targets, I used the Data NY and the Statewide GHG Emissions dataset available there to breakdown the differences between the 1990 baseline and the 2019 and 2020 emissions for various sub-sectors and fuels. The caveat is that these are only estimates and not the official sub-sector emissions. The following tables present data by the agriculture, buildings, electricity, industry, transportation, and waste economic sectors.
The first table summarizes the emissions using the New York State global warming potential accounting approach for 20 years and the Intergovernmental Panel on Climate Change accounting for 100 years for each of the sectors and the overall totals. It is not clear exactly which components of each sector will be subject to NYCI obligations but the totals suggest that the aspirational goals will be a challenge to meet. The agriculture, buildings, transportation, and waste sectors all need to reduce emissions over 40% between 2019 and 2030. While the electricity sector seems to be in good shape relative to the target the 2019 data does not reflect the shutdown of 2,000 MW of zero-emissions nuclear generation at Indian Point which raised the sector emissions by over 20%.
Statewide Greenhouse Gas Emissions (MMT) by Sector Relative to 2030 Target
The following tables list data for unique combinations within each sector for the category, and sub-category labels For example, within the agriculture economic sector there were two categories: livestock and soil management. Within those categories there were five additional sub-categories. I listed data for the entire agriculture sector in the first row of the table. The baseline 1990 emissions were 15.3 million metric tons CO2e using the global warming potential 20 year approach. The 2030 limit is 9.2 MMT CO2e 20yr. In 2019 the emissions were 21.3 MMT CO2e 20yr which represents a 6.0 MMT CO2e 20yr 39%) increase from the 1990 baseline. In order to get to the 2030 limit a reduction of 12.1 MMT CO2e 20yr -57% is needed. Note that DEC has mentioned that due to the pandemic that 2020 is not a representative year so I only show 2019 data. . Within the agriculture sector I list the livestock 1990 emissions (13.6 MMT CO2e 20yr) and the soil management 1990 emissions (1.7 MMT CO2e 20yr). Note that the sum of these categories equals the total of the sector. The data for the sub-categories is also presented. In the agriculture sector I believe some of the categories will be exempt. Nonetheless it is obvious that there is a long way to go to meet the 2030 target.
Agriculture Sector GHG Emissions Trends Relative to 2030 Target
The buildings sector has the largest emissions of any sector. Note that the Climate Act mandates that emissions from upstream sources as well as direct emissions. This places an emphasis on eliminating the use of fossil fuels because New York sources have no way to reduce emissions from upstream sources other than to stop importing the fuel. I doubt very much that the proposed goals can be met by displacing the use of fossil fuels with electrification. The compliance certainty feature associated with the cap means that the ultimate compliance strategy will be to limit fossil fuel use even if the replacement electrification technologies are not available.
Building Sector GHG Emissions Trends Relative to 2030 Target
The inherent biases in the Climate Act GHG emissions accounting approach is evident in the electricity sector trends. Note that in 2019 the New York accounting claims that direct GHG emissions are only slightly more than the upstream imported fossil fuel emissions. Those numbers are not credible and I predict that there will be concerted efforts to refine the emission factors used to generate them.
Electricity Sector GHG Emissions Trends Relative to 2030 Target
The industry sector also appears to be relatively close to the 2030 target. However, it is not clear if this is due to decarbonization efforts or New York’s de-industrialization since 1990. More importantly is the question whether the 10% overall reduction necessary to get to the 2030 target is feasible for the remaining industrial operations.
Industry Sector GHG Emissions Trends Relative to 2030 Target
It is not clear how the Hochul Administration plans to decarbonize the transportation sector to the extent necessary in the next seven years. Transportation emissions went up 10% from 1990 to 2019 and need to decrease 49% by 2030. According to the webinar “Large-scale GHG emitters and distributors of heating and transportation fuels will be required to purchase allowances for the emissions associated with their activities”. For the transportation sector that means when the allowances for transportation fuels run out, suppliers will not provide gasoline and diesel fuel to the retailers. The resulting fuel shortage will be entirely due to the non-existent feasibility planning by the state.
Transportation Sector GHG Emissions Trends Relative to 2030 Target
I am glad I am not associated with the waste sector. It is my impression that there are very few options available for solid waste management. So what did the Scoping Plan suggest. Increased recycling and waste minimization to reduce the waste stream. In this case the only option I can think of when the allowances run out is to stop accepting waste.
Waste Sector GHG Emissions Trends Relative to 2030 Target
There are many questions about the NYCI proposal that must be addressed this year. Frankly I think the Hochul Administration is going down the wrong path in its implementation plan because they are already mired in details but have not addressed fundamental issues.
Before proceeding it is necessary to determine what has to be done to meet the 2030 target and whether it is feasible to make the reductions on the required schedule. If it is feasible that is one thing but given these numbers that appears to be a high hurdle. The compliance certainty “feature” of NYCI is great as long as the targets are achievable but if they are not met, then the draconian compliance alternatives are going to cause a backlash of monumental proportions.
The other thing that should be done before proceeding any further is to determine the costs of the technologies necessary to achieve the goals using the compliance strategies in the feasibility analysis. Even if the technologies are deemed feasible, if investments are insufficient to deploy the technologies as needed then the targets won’t be met. If it turns out that the revenues necessary for successful investments are politically unpalatable, then it is time to reconsider the implementation plan.
I am not optimistic that this could possibly end well. Watch this space for more information as this unfolds.