Tuesday, March 31, 2015

What does it mean to "run out"?

Re: the California drought, from the Los Angeles Times:

"It is the economics of having to go deeper and deeper for groundwater that will ultimately force growers to retire land. It's not that the Central Valley's thick aquifer will run dry. Scientists estimate that it holds roughly 800 million acre-feet of water that seeped deep into the valley's sands and clays over millenniums from streams and rivers swollen with runoff from the neighboring Sierra Nevada and coastal ranges.

Farmers will instead run out of water they can afford to pump. As the groundwater table drops ever lower, wells become prohibitively expensive to drill, water quality deteriorates and it takes more energy, and thus money, to pull supplies from depths of 2,000 feet or more."

"To save our valley, we have to police ourselves," Pitigliano said, acknowledging that it won't be easy.

Monday, March 30, 2015

Food prices hit a low

We talked about food prices in the past slides, but I hadn't realized how well we are doing on that front. It turns out that last fall they were at their lowest level in four years, a development that was no doubt widely appreciated if not much remarked upon. Even so, though, Europe seems to be in an economic doldrums. I'm not a macroeconomist so I won't speculate on what might be keeping them down, but this would imply that the problem isn't just consumers with tight budgets....

Paris in the Smog

     Paris is currently the most polluted city on the planet in terms of air pollution. The smog (PM10 particles created by vehicles and industry) had been especially bad in March, which prompted city officials to put new temporary vehicle restrictions in place. The new measures allow only energy efficient cars, vehicles with odd-number plates, or cars carrying three or more passengers to be allowed to drive in the city. Vehicles were also restricted from exceeding 20kph. People violating these rules were fined €22. To ease the burden these measures place on potential commuters in the city, public transportation and residential parking were made available free of charge. The ban lasted five days and this is the third time since 1997 that such restrictions have been put in place. The ban was estimated to have resulted in a 40% reduction in traffic and a noticeable reduction in air pollution according to city residents. No official numbers have been published at this time. Some citizens and politicians have suggested that officials should instead try to find more sustainable solutions to the pollution problem.
I have to agree that officials should be doing more to curb the pollution problem. The current approach of these temporary bans does not seem sustainable. The smog will only get worse as time goes on, and more frequent temporary bans does not seem feasible. Free public transportation would be very costly, and once the ban is over the pollution simply comes back. What should be done is the implementation of new emissions regulations and incentives for people to ride bikes, carpool, drive cleaner cars, or use public transportation daily. Temporary bans could be effective while new legislation is in the works and before the new regulations start working to their full potential. These bans should not be used as a crutch against pollution.
--David Lanier

California Doubles Down on Renewable Energy

     According to this article California’s fourth term Governor, Jerry Brown has proposed to spend 59 billion dollars to fix infrastructure and raise the state’s renewable energy mandate to 50 percent by 2030. It is believed that his proposal will reboot California’s industrial-scale solar and wind industries and create another land grab in the Mojave Desert.
This isn’t the first time the Governor has set a benchmark for the state. Back in 2011 Governor Brown signed a law that would mandate 33 percent of the state’s energy be renewable by 2020. Since that time the state is not only on track to meeting that goal but will likely surpass it. Being on track of achieving the original goal has been a blessing and a curse for California.
     The good thing about achieving the goal is it led the country by example, showing large scale radical environmental policy can create long lasting change in energy use. The bad part about being on target to achieve the goal is the utility companies have lost interest in signing new contracts with large scale renewable energy firms, because there was no incentive to do so. Therefore many clean-energy developers don’t have the financing for large-scale projects. The clean-energy industry hope for the new benchmark is that it will renew interest in utility companies to contract large scale renewable energy developers.
There are several challenges associated with the new 50 percent standard. One is how the Governor will bring the 50 percent standard into law. Govern Brown could issue an executive order or ask the Legislature to craft a bill that will be likely to pass with the liberal state Senate. The other challenge is the limitation of renewable energy. Renewable energy is intermittent and the supply does not always meet the demand, therefore companies must find a way to balance and integrate renewable energy with non-renewable. Another challenge is the land use these large scale clean-energy companies will take up in the Mojave Desert.
     The Obama administration has set aside 22 million acres in California as Federal land for renewable energy endeavors. However, some of the construction that will take place on that land might negatively affect ecosystems and ancestral homelands of the Colorado River Indian Tribes. Last year the Colorado River Indian Tribes filed a lawsuit to stop construction of a solar energy plant that will span 4,000 acres in the Mojave Desert. In the lawsuit the Tribes claim the U.S Bureau of Land Management environmental impact statement for the project failed to take into account the damage that would incur to the ecosystem, culture, groundwater and the Colorado River.
     Even though there are many challenges setting the new standard, it is exciting to see a politician take such a bold stance on renewable energy. This article, showed how the environment, economics, law, and policy are interconnected and all must be taken into account when trying to bring long lasting change. The article also helped me to understand how economic incentives and policy can have an impact on the environment.
The article spoke of the utility companies that stopped contracting clean-energy developers once the incentive was gone. Because there was no push on businesses through economics or policy, progress in renewable energy became stagnant. However, while the incentive was there California achieved an environmental goal many thought couldn’t be accomplished, especially within a short 10 year period. This article has shown me that true environmental change has to start with changes in policy: if not businesses and individuals will be more inclined to do what is economically beneficial.
--Amanda Akins

Oil Spill in Yellowstone River

  This past January a pipeline burst that runs under the Yellowstone River in Glendive, Montana. About 50,000 gallons of oil spilled into the river, affecting over 6,000 people’s water supplies. There is still no definite answer about what caused the pipeline to burst, but it is not much of a surprise to many since the pipeline is 50 years old and lies only eight feet beneath the river bed.  The Bridger Pipeline Company shut down the line after the leak was detected, but the oil still managed to flow 60 miles downstream.  Many restaurants and businesses had to shut down due to the quality of the water and some parents even kept their kids home from school.  Although Glendive was highly impacted by this spill, many locals are very supportive of the oil industry because it provides a lot of jobs and incoming money.  A big issue is that this is the second time in five years that oil has spilled into the Yellowstone River.  These types of incidents are what cause a lot of hesitation about the Keystone XL pipeline.

Two months after the spill, the Bridger Pipeline Company is preparing to resume shipments.  This raises a lot of concern considering only about 10% of the spilled oil has been recovered.  Federal regulators are declaring that the replacement section of this pipeline is installed 40 feet below the river bed to avoid incidents like this in the future.  While I understand that the pipeline company has to resume use of the pipeline at some point, I think their recovery efforts were not up to par.  Making money is obviously the company’s priority, so I’m sure they did whatever they needed to do in order to resume shipment as soon as possible.  Even with that in mind, they are the ones who own that pipeline so they should be responsible for doing as much oil recovery as possible.  The article mentioned that filters were used to remove petroleum products from the water, but the impeding ice made recovery efforts difficult.  I agree with the decision that was made to rebuild the pipeline much further below the river bed, but I think these types of decisions should be made before incidents like this occur.
--Sarah Smith

Saturday, March 28, 2015

Climate Change Proposal

William Nordhaus, an economist who has long been investigating climate change issues, recently published a paper with an idea for how to combat climate change. Concerned countries should form a "club" and agree to all take action to mitigate climate change. In addition to acting to prevent climate change, the countries should also implement a tariff on all trade from countries not in the "club." The tariff would not in itself help fight climate change, but it would give outside countries a reason to want to be in the club. (Of course, once they are in the club they will have to take action to reduce climate change themselves.)

Please take a look at the paper. I will not hold you responsible for reading the whole thing, but please look it over. This is an example of a peer-reviewed paper of the type you will need for the paper you will start working on next week. In fact, it's from one of the very top (if not THE very top) journals for work in the discipline of Economics, so it carries a lot of weight among my people.

Here is another, more accessible piece by Nordhaus. You probably won't believe it after reading this, but Nordhaus was a skeptic of climate change initially. One of his early papers came to the conclusion that yes, the climate was warming, but that warming would benefit the United States, since we are a mid-latitude country. He has since revised that assessment, concluding that the costs greatly outweigh the benefits.

Monday, March 23, 2015

End of material for reading quiz 1

Reading Quiz 1, to be held on Wednesday March 25th, will cover everything posted in 2015 up through this point. Materials posted after this will be on the second quiz at the end of the semester.

Sunday, March 22, 2015

New Regulations on Fracking

Although industry is upset and environmentalists sniff that they don't go far enough, the Obama administration has issued regulations on Fracking. This set of rules, which goes into effect in 90 days on Federal lands only, requires certain safeguards and tracks disposal of wastes. While this is a great start, I'm at least as interested in the regulations that are to come. According to the article linked above, we should soon see regulations on methane emissions around frack sites. If natural gas is to help reduce the emissions associated with climate change, we need to ensure that gases escaping the frack site are captured.

Cartels in the news

We talked about a few monopolies and cartels in class like OPEC and BG&E, but would you have expected a cartel in milk? They don't have a resource they control exclusively and they certainly weren't given control over something by the government. In fact, the government has fined them millions of Euros, as shown in the piece posted under Readings (on Blackboard). So how could they manage it? Hm. Sounds like an exam question.

Sunday, March 15, 2015

Seafood Fraud

As a state that enjoys the benefits of a $600 million seafood industry, we in Maryland have to be aware of issues like "seafood fraud," in which fish are harvest illegally, they are unreported, and/ or are removed from unregulated waters. So-called IUU fishing "risks the sustainability of a multi-billion-dollar U.S. industry."

Today the Obama administration released its action plan to combat IUU fishing. Mostly this involves working with other countries to track products where possible and make them traceable where they aren't. It takes a lot of cooperation to efficiently use public goods!

Friday, March 13, 2015

Drought worsens

California, one of the most productive agricultural areas in the world and home to almost 40 million people, has been facing a drought for years, and rainfall through this year's wet season has been less than 20% of normal. I'd say something like "out of the frying pan" but they fell out long ago. The article linked above says that there's about one year's worth of water left in reservoirs, and calls for immediate rationing. That would mean, I assume, basically no crop production. I suppose that's good news for farmers in other parts of the world, but very bad for Californians and very bad for us consumers!

Update: the low amount of water is also spurring activity in water markets. Water markets are mostly dormant, but when things get tough, buying and selling water does happen, and I'm not talking about PET bottles! One acre foot is about 2.5 million of those little bottles, and these deals are for over 100,000 acre-feet. While it seems like a no-brainer for rice farmers to sell their water since they can make more money selling the water than they can by using the water to make rice) there are other concerns that the article points out, such as the fact that if too much gets sold, then local infrastructure for processing rice will be unable to function. In the long run, if the water continues to be needed in the urban areas, that's fine; if these are a few lean years, though, then you don't want to give up that infrastructure. We'll learn more later this year about water markets.

Food Waste

While the world’s population continues to increase, food waste is increasingly being seen as a serious environmental and economic issue. Not only are millions of households across the world struggling to put food on the table but also food waste comes at a great cost. A new report by the “UK Waste & Resources Action Program” released on Wednesday February 25th, projects that “about 60 million metric tons of food is wasted a year in the United States, with an estimated value of $162 billion”. An estimated 32 million metric tons of it end up in municipal landfills that cost about $1.5 billion dollars to the landfills local governments. Unfortunately this problem is not only limited to the United States. The report estimated that about one third of all food produced in the world is never consumed equal to about $400 billion dollars. According to the United Nations the food that goes unconsumed would be more then enough to feed the 870 million hungry people in the world. Other then being a social cost food waste is also an environmental issue. Food waste in landfills contributes to 3.3 billion metric tons of greenhouse gases annually, about 7 percent of the total emissions. It's clear that food waste is a major issue and fixing the problem could drastically affect the world's economy.
Countries and cities across the globe have started programs to reduce food waste. Some cities provide grants to local businesses and nonprofits to help recycle food products. In Hennepin County, Minnesota the government gives grants $10,000 to $50,000. It’s essential that the food industries across the globe come together to provide solutions and incentives to reduce waste.

While many possible solutions are being used to decrease our global food waste, I feel the most important solution that the article did not discuss is to raise awareness. Governments and major food industries must spend money to educate the public on food waste if they want to see positive change. If advertisements were placed in supermarkets displaying food waste statistics, or signs that say to “only buy what you eat,” customers may take notice and reduce their individual food waste. Another possible solution to reducing food waste that could be effective is investing money in how we produce fish, meats, and dairy products are stored and collected. For instance if better refrigeration technology were created we can store food on store shelves for a longer time before going bad. Additionally if investments were used for more efficient food transportation we could get the food to the store quicker and also increase shelf life. There is huge incentive for investing in reducing food waste. The article discussed that reducing “food waste from 20 to 50 percent globally could save $120 billion to $300 billion a year by 2030.” In my opinion the world economy cannot afford to not invest in reducing food waste.
--Brian Beck

Value of Parks

The world's terrestrial national parks and nature reserves, about 94,238 sites, receive around eight billion visits every year, according to the first study into the global scale of nature-based tourism in protected areas (Cambridge). The authors of the study conservatively estimate that $600 billion in direct tourism expenditure is generated annually around the world from these protected areas; which far surpasses the only $10 billion spent globally to protect, maintain, and manage these areas. There is also a $250 billion “consumer surplus” that people would be willing to spend if they had to for these visits. While $600 billion dollars might seem like a lot of money, “…it’s a fraction of the economic benefit we get from protected areas”. These protected areas generate so much revenue, but “they comprise 12.7% of the Earth’s land surface” (Mooney). Both of the articles state the main conclusion of  the study, that “substantially increased investments in protected area maintenance and expansion would yield substantial return” (Cambridge).

Personally, I think that this study will prove to be extremely beneficial. Once the government sees that protected areas can generate so much money from direct tourism, they will definitely start funding them more; which is great. I am sure the government will also try to take even more advantage of the willingness to pay in certain areas by charging for select area entry. Although protecting large-scale environmentally fragile areas would be the ideal, the protection of smaller areas is also important. Metropolitan parks are also important because they help lessen the carbon footprint of the city surrounding them, generate clean air, and provide homes for wildlife, among other benefits. The study mentioned that wealthy North Americans and Europeans account for about four-fifths of protected area visits, and that the highest recorded visit rate was in San Francisco, CA and the lowest was in Africa. I would conclude that if Africa had more stable governments that tourism might be more frequent.
--Kallie Fullem

Solar eclipse's effect on solar power

On March 20, there will be a total solar eclipse over the Atlantic Ocean, Europe, Northern Asia, and Northern Africa.  The eclipse will begin around 8:40am and will last until ~11:15am. There has not been a total solar eclipse in Europe since 1999.  Over the course of this 16 year gap the use of solar panels (and their storage capacity) has exponentially increased. Thankfully scientists have known about this event for months, and have been working with energy officials to find alternative short term energy boosts to compensate for the lost solar energy. The energy grid will see a large immediate drop off in energy, as well as a large sudden return, which due to the relatively low input from solar, should for the time be manageable. Scientists are trying to use this event to foresee what can be done if the shift occurs to use ever greater solar panels, as at some point it will not be feasible to make up for the lost energy and the grid will simply cease supply to non-necessities.

Personally I find this extremely interesting, as we always hear the push to go renewable, and how more renewable can you get than the sun after all? As solar eclipses are quite rare thankfully, in the far future, people may simply have to: go outside, spend time with loved ones, or adjust to a few hours without power during future eclipses. Energy experts will have their work cut out for them though figuring out how to deal with the sudden loss/return of energy, which could be extremely damaging. Perhaps in the future we will be able to segment portions of solar panels to turn back on, thus easing into the energy return. All I can say, is I wish I was in Europe to see this!
--Jacob Wrzesien


In no particular order:
Pork (in medicine)
Corn ethanol

Monday, March 9, 2015

California droughtin'

California’s ongoing drought is expected to continue and researchers think they have found the reason for this drought. There have been 6 droughts in the past 20 years, 4 of them being consecutive, and the current drought is expected to continue into 2015 with another increase in temperature.

With the extreme heat and dryness mixed with little to no precipitation, this drought has cost $2 billion to the state of California, plus additional externalities that haven’t shown their monetary damage yet. For example, the state has been unable to fill its rivers and reservoirs with fallen snow or water, and with the excess heat, that brings more evaporation taking the little moisture the state does have.

Researchers are saying it's not always a dry year that triggers the drought, but it is now (since dry years more often combine with high temperatures) due to long heat waves that humans are to blame for. The burning of fossil fuels like oil, gas, and coal that are releasing carbon dioxide and other greenhouse gases have been the main cause of this ongoing drought.

Naturally, a lot of businesses that revolve around water are suffering and/or being forced to shut down because they cannot operate. For example, organic dairy farms have shut down because they rely on graze fed cattle to produce milk.  Also, golf courses have closed because their entire business revolves around a green field. Breweries, which have already been forced to cut back on water by 20%, are suffering losses. The Sushi business is taking a hit because most rice is produced in California. And lastly, the medical marijuana business is unable to sufficiently grow plants with the lack of water.

Now, with all of these businesses being unable to produce to the same level as they used to, it is bound to have a drastic impact on their individual markets. Depending on the cost and simplicity, some businesses may be able to come up with alternative ways to produce their products, leaving no effect on the supply of the goods. But some businesses, like the organic dairy producers, have already been forced to shut down. And in turn, the regular dairy producers (substitutes for the organic products) have seen a major rise in business and have been able to raise prices as well.

Not only will California have to come up with alternative ways to sustain their wildlife, but they will also have to come up with ways to keep their local businesses going and not let this drought ruin their economy.
--Nicole Gabrovsky

What does that have to do with the price of eggs?

The two news articles that I reviewed both discussed California’s Proposition 2. The proposition, brought forth by the Humane Society of the United States, requires a new standard for caged hens. The proposition, which was approved in 2008, stated that by January 1st, 2015 hens have to be placed in cages that are big enough for them to stand up and stretch. While this was a proposition in California, it extends to any egg producers that export their eggs into California. States like Iowa and Ohio, who are major exporters of eggs into California, have to abide by these regulations as well (Fox, 2015).
The announcement was not welcomed by farmers. According to the guardian, the president of the Humane Farming Association (HFA), “blasted” the law and the primary sponsor (Westervelt, 2015). The president of HFA, Bradley Miller, said the law still promotes the use of cages and that it is a step in the wrong direction. Instead of moving towards cage-free or pasture-raised hens, farmers bought larger cages to place the hens in. Farmers who could not afford to buy bigger cages ended up killing their hens to meet the standards.
When reading the two articles I found myself better understanding the damage that a poorly made policy could have on producers and consumers. Instead of using incentives to help farmers switch to cage free or pasture-raised hens, the law put a financial burden for the implementations of bigger cages. In my mind, if I was a farmer I would be faced with 3 options: (1) buy bigger cages (2) decrease/kill my hen count to adhere to the regulation or (3) go out of business or export to another state.  Moving to cage-free or pasture raised eggs wouldn’t even be considered an option in my mind since it would require a substantial change in environment and technique (something that some of these farmers could not develop).
Outside note:* If I was to pursue this issue further, I would definitely look at the difference in policy between California’s proposition 2 and EU policy on the banning of battery cages. I would also look at the problems associated with cage-free and pasture-raised eggs. From what I currently see (which is quite interesting) is that battery cages create behavioral deprivation, while free range and pasture raised hens create problems from a lack of management and neglect by the farmers. I could discuss this further if needed.  *
--Ben Glaser

Exelon and the Conowingo

The two articles I read that dealt with Exelon and the Conowingo Dam issue came from different aspects. The Baltimore Sun reporter, Timothy Wheeler, came in with the main focus being the fact that Exelon’s hydroelectric generating permit may be denied by the state amid water quality issues related to the Susquehanna River. The other article on DelmarvaNow.com was covering the latest study of the Conowingo Dam that deemed the dam “not a major threat” to the Chesapeake Bay and its ecological health. The Sun reporter talks about how and why the state of Maryland decided to initially deny Exelon its permit saying that the electric company should be held responsible for the water quality as well as the issues faced by some migratory species in going upriver during their lifecycles.  Exelon is on the hook to spend millions over the next few years on improving conditions of the river in the hope that the company will get its permit renewed. 

The second article I looked at didn’t focus so much on the permit but more so on the issue holding up the permit and that is the health of the river near the dam. This article is about a study that was to be released saying that the Conowingo Dam is not a threat to the Chesapeake Bay. The study was conducted by; the US Army Corps of Engineers, United States Geological Survey, the Maryland Department of the Environment and Maryland Department of Natural Resources. 

I don’t believe it to be fair to hold Exelon accountable for all the Susquehanna River’s water quality issues. I do think it is good and necessary that Exelon will actively look to improve the water but the river extends all the way north through Pennsylvania and New York. The main issues that arise with the water quality of the river are storm water and sediment runoff. There is little Exelon will be able to do about these issues because they do not make policies and the river is so extensively large. Exelon is the scapegoat of the situation with the river and the dam. I believe the blame is falsely put on them to shield the real issue at hand and that is runoff problems in multiple states because it’s a hard issue to tackle.

--Daniel Spradlin

Janicki Omniprocessor

I read an interesting article from Bill Gates’s blog. This article is about a high technology factory called Janicki ominprocessor. This factory can turn human waste into drinking water, and at the same time, it generates electricity. This article is coming with a video which posted on January 5. In the video Bill gates drink a glass of pure water which was human excrement 5 minutes before. Although we can’t say that turning excrement into clean drinking water is a great innovation [why not? --JM], the unique part of Janicki Omniprocessor is to achieve generate electricity, wastewater treatment, and solid waste treatment together.

            I played a computer game called SimCity in which the hardest challenges are wastewater treatment and electricity problems. They are hard because they are not only about wastewater treatment and electricity, but also environment problems. I have to build water treatment plants and power stations in the corner because they pollute land, and people who live near to them are easy to get sick. Although Simcity is a computer game, it comes from real life. Water and pollution problems have already become major problems for many countries. For example, urbanization in China is getting worse and worse; water for living and urban sewage have become big issues. According to the Ministry of Water Resources statistics, 400 of 669 cities have inadequate water supplies, and 110 cities have serious water shortages; 30 cities with 32 million people are plagued by water shortages. Among 46 major cities, 45.6% of cities have poor water quality. This is not only in China, but also in many countries around the world. So the Janicki Omniprocessor may be the answer for these problems. I really like this factory, maybe today people don't necessary need it, but I believe this kind of technology will become more and more important in the future. I think resource recycling will become more important in the future, because nature has been loaded to the limit. There are so many people living in the world and the population keeps growing. We can’t just take from nature, we need to coexist. Humans need to develop sustainably: I think human will reach zero wastage rate in the future.
--Lingyu Zhang

Friday, March 6, 2015

Electric vehicles available cheap!

Great times for people wanting to buy an electric vehicle. Even as Baltimore City (and Towson University) have been ramping up support in the form of charging stations, the price of the vehicles is dropping rapidly, particularly for used vehicles. That's not a good sign for sellers, and for the market in general, but for consumers it's a bonus!

Thursday, March 5, 2015

Snow day

Stuck at home today watching the snow fall, I'm glad I'm not dependent on harvesting seafood for a living. Steve Vilnit of the Maryland Department of Natural Resources just posted a 1 minute video about icebreakers clearing a path through the Chesapeake for supplies to Bay communities. At least a thaw is expected next week!

Chinese pigs

Scary quotes about the Chinese pork industry, from the Economist (h/t to Tyler Cowen):

Ms Schneider reckons that more than half of the world’s feed crops will soon be eaten by Chinese pigs. Already in 2010 China’s soy imports accounted for more than 50% of the total global soy market.

Entire species of plants and trees are being sacrificed to fatten China’s pigs.... In Brazil, more than 25m hectares of land—parts of which were once Amazon rainforest—are being used to cultivate soy.... Since 1990 the Argentine acreage given over to that crop has quadrupled: the country exports almost all of its whole soyabeans—around 8m tonnes—to China. When Shuanghui, China’s largest pork producer, bought Smithfield Foods, an American firm, in 2013, it acquired huge stretches of Missouri and Texas.

Feeding the pigs is not farmers’ only concern. Their greatest fear is disease [so they use antibiotics which] are associated with the emergence of “superbugs”, bacteria in animals and humans that are resistant to most antibiotics. These drugs pass into the wider food chain partly via sizzling plates of pork, and partly through the 5kg of manure that the average pig produces a day.... Porcine waste also contributes to emissions of methane and nitrous oxide, a greenhouse gas that is 300 times more potent than carbon dioxide.

Have a nice day.