Here’s an article that’s illustrates what happens when regulators get clever in creating incentives for environmental stewardship and responsibility: smart people work around them, unintended consequences result, and windfall profits occur in random places that have nothing to do with environmental benefit.

If I were doing this, I’d make the whole situation (more…)

Europeans believe climate change is an even greater threat than the current economic crisis, and second worldwide only to poverty, a new poll says.

According to the Eurobarometer poll, which was conducted in June, 89 percent of respondents said climate change is a “serious” problem, while 68 (more…)

President Barack Obama’s chief science advisor, Professor John Holdren has stated that it is unlikely that congress will pass a bill that will put a tax on carbon emissions.

Speaking at a meeting of the American Association for the Advancement of Science, Holdren admitted that President Obama would have to focus his efforts on improving energy efficiency, increasing (more…)

(Reuters) – A top Pennsylvania Republican rejected a Democratic-sponsored plan for taxing natural gas production on Wednesday, vowing to stop a bill that he said would drive energy companies out of the state.

The opposition will force Governor Ed Rendell, a Democrat, to seek a compromise between Democratic and Republic plans. (more…)

The German government plans to tax airline passengers as much as €26 ($33) per flight as part of a plan to reduce carbon dioxide emissions and other environmental impacts of the aviation industry and to generate revenue. Passengers will be required to pay €13 per flight up to 1,553 miles within the European Union and €26 for longer flights departing (more…)

The enthusiasm is building — we’re just a few months from the U.S. launch of the first electric vehicles aimed at mainstream consumers. Nissan is touting the success of the registration program for its upcoming Leaf EV, boasting 13,000 orders for its vehicles.

It is hoped across the industry (and in Washington DC) that sales of EVs will revive the American auto industry. While Pike Research believes that sales of EVs will grow relatively quickly, EV sales would likely grow much higher if it weren’t for our relatively cheap gasoline.

China will be the global leader in EV sales, with more than a quarter million of EVs sold in 2015, according to our projections at Pike Research. Sales of EVs in Europe – even with fewer homes with convenient access to home charging – are expected to outpace the American market.

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By now there’s little debate that the technology used to obtain oil in deeper waters was developed and rapidly put into use before safety technology could keep up. As we’ve noted, that’s a development that regulators allowed, despite their concerns.

But the expansion of deepwater drilling wasn’t solely a result of industry rushing into deeper waters and toward greater profit. According to the Los Angeles Times, it was also encouraged by the federal government, which gave oil companies tens of billions in tax breaks, subsidies, and royalty relief. Many of these incentives have outlasted their initial purpose, according to the Times: (more…)

Since 1981, France has had a true high speed rail service, the TGV (Train à Grande Vitesse).  We here in the US are only about 30 years behind the French in the regard…and counting.  As US politicians continue to dither on high speed passenger rail, throwing loose change at development, the French corporations like Alstom have perfected this product for export to its former colonies in the developing world making big profits.  Since the US is on par with developing world rail infrastructure, we may be best served by swallowing our pride and purchasing this technology from French post haste.

The TGV’s maiden voyage was between Paris and Lyon on September 27^th, 1981.  Ridership is expected to hit the 2 billion mark in 2010.  It is a smashing commercial success, but goes further than that as a symbol on national pride and technological prowess.  It is a cornerstone of European integration as it connects France to the UK and her continental neighbors with speed and dependability.  Let us parse out the credit for this success to everyone, but one small group of people deserves a mention: the riche.

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The movement towards zero emission electric cars is gaining a tremendous amount of momentum. As we move into 2010, practical electric vehicles for the vast majority of the public will be available late in the year with the release of the Nissan Leaf. The shift that may occur in the coming years provides the opportunity to engage in open dialogue about the tax benefits and burdens as the US moves into the era of the electric car.

If you plan to purchase an electric car in 2010, you can expect a healthy federal income tax credit to reward you. For plug-in electric vehicles with a gross vehicle weight of less than 14,000 pounds acquired after December 31, 2009, the maximum tax credit available will be $7,500. The base amount of the credit is $2,500. If the car has a battery capacity of at least 5kWh, then an additional $417 in tax credits will be available. For every kWh of battery capacity in excess of 5kWh, $417 will be added to the total amount. The additional amount, based on battery capacity, over the base amount is limited to a total of $5,000.

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Project finance within renewables – solar in particular – has made great progress over the past few years with the introduction of the solar PPA, and with financiers developing longer term operating data from which to base their financial models. Educated guesses are more educated and less of a guess, and big money has entered the space as the financial model has become more credible.

Enter the 2008 financial crisis. Surely, the world’s worst financial crisis (and tightest credit market) since the Great Depression will impact renewable energy project development, which is an inherently capital-intensive industry. The question is, who will it affect, and how badly? I think it’s too early to know for sure, but without a doubt, investors will likely demand higher returns for both debt and tax equity (a special form of equity designed to maximize use of tax credits) due to a general scarcity of capital. However, I don’t think funding will dry up, as solar projects boast a very different risk-return profile than do other investments given that government subsidies constitute a large slice of the project’s value and project cash flows aren’t particularly risky.

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