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24–631 PDF 2005

S. HRG. 109–188

CLIMATE CHANGE

HEARINGS

BEFORE THE

COMMITTEE ON 

ENERGY AND NATURAL RESOURCES 

UNITED STATES SENATE

ONE HUNDRED NINTH CONGRESS

FIRST SESSION

TO

RECEIVE TESTIMONY REGARDING THE CURRENT STATE OF CLIMATE 

CHANGE SCIENTIFIC RESEARCH AND THE ECONOMICS OF STRATEGIES TO MANAGE CLIMATE CHANGE

JULY 21, 2005

SEPTEMBER 20, 2005

(

Printed for the use of the 

Committee on Energy and Natural Resources 

(II)

COMMITTEE ON ENERGY AND NATURAL RESOURCES 

PETE V. DOMENICI, New Mexico, Chairman 

LARRY E. CRAIG, Idaho 

CRAIG THOMAS, Wyoming 

LAMAR ALEXANDER, Tennessee 

LISA MURKOWSKI, Alaska 

RICHARD M. BURR, North Carolina, 

MEL MARTINEZ, Florida 

JAMES M. TALENT, Missouri 

CONRAD BURNS, Montana 

GEORGE ALLEN, Virginia 

GORDON SMITH, Oregon 

JIM BUNNING, Kentucky 

JEFF BINGAMAN, New Mexico 

DANIEL K. AKAKA, Hawaii 

BYRON L. DORGAN, North Dakota 

RON WYDEN, Oregon 

TIM JOHNSON, South Dakota 

MARY L. LANDRIEU, Louisiana 

DIANNE FEINSTEIN, California 

MARIA CANTWELL, Washington 

JON S. CORZINE, New Jersey 

KEN SALAZAR, Colorado

ALEX FLINT, Staff Director 

JUDITH K. PENSABENE, Chief Counsel 

BOB SIMON, Democratic Staff Director 

SAM FOWLER, Democratic Chief Counsel 

JOHN PESCHKE, Professional Staff Member 

JONATHAN EPSTEIN, Legislative Fellow 

(III)

C O N T E N T S 

Page

Hearings: 

July 21, 2005 ..................................................................................................... 1

September 20, 2005 .......................................................................................... 67

STATEMENTS

JULY 21, 2005

Akaka, Hon. Daniel K., U.S. Senator from Hawaii .............................................. 8

Bingaman, Hon. Jeff, U.S. Senator from New Mexico .......................................... 4

Bunning, Hon. Jim, U.S. Senator from Kentucky ................................................. 3

Cantwell, Hon. Maria, U.S. Senator from Washington ........................................ 8

Cicerone, Ralph J., Ph.D., President, National Academy of Science, and Chairman, National Research Council ........................................................................ 12

Corzine, Hon. Jon, U.S. Senator from New Jersey ............................................... 2

Domenici, Hon. Pete V., U.S. Senator from New Mexico ..................................... 1

Feinstein, Hon. Dianne, U.S. Senator from California ......................................... 3

Houghton, Sir John, Co-Chairman, Scientific Assessment Working Group, 

Intergovernmental Panel on Climate Change, London, England .................... 21

Hurrell, James W., Ph.D., Director, Climate and Global Dynamics Division, 

National Center for Atmospheric Research, Boulder, CO ................................ 35

Martinez, Hon. Mel, U.S. Senator from Florida .................................................... 5

Molina, Dr. Mario, Professor, University of California, San Diego ..................... 30

Murkowski, Hon. Lisa, U.S. Senator from Alaska ................................................ 6

Salazar, Hon. Ken, U.S. Senator from Colorado ................................................... 10

Talent, Hon. James M., U.S. Senator from Missouri ............................................ 11

SEPTEMBER 20, 2005

Akaka, Hon. Daniel K., U.S. Senator from Hawaii .............................................. 68

Bingaman, Hon. Jeff, U.S. Senator from New Mexico .......................................... 70

Corzine, Hon. Jon, U.S. Senator from New Jersey ............................................... 69

Domenici, Hon. Pete V., U.S. Senator from New Mexico ..................................... 67

Feinstein, Hon. Dianne, U.S. Senator from California ......................................... 71

Gruenspecht, Howard, Ph.D., Deputy Administrator, Energy Information Administration, Department of Energy .................................................................. 72

Grumet, Jason S., Executive Director, National Commission on Energy Policy 94

Morgenstern, Richard D., Ph.D., Economic and Senior Fellow, Resources for 

the Future ............................................................................................................. 101

Murkowski, Hon. Lisa, U.S. Senator from Alaska ................................................ 71

Smith, Anne E., Ph.D., Vice President, CRA International ................................. 78

Thomas, Hon. Craig, U.S. Senator from Wyoming ............................................... 70

APPENDIXES 

APPENDIX I 

Responses to additional questions .......................................................................... 125

APPENDIX II 

Additional material submitted for the record ........................................................ 219

(1)

CLIMATE CHANGE 

THURSDAY, JULY 21, 2005

U.S. SENATE, COMMITTEE ON ENERGY AND NATURAL RESOURCES, Washington, DC. 

The committee met, pursuant to notice, at 10:06 a.m., in room 

SH–216, Hart Senate Office Building, Hon. Pete V. Domenici, 

chairman, presiding. 

OPENING STATEMENT OF HON. PETE V. DOMENICI,

U.S. SENATOR FROM NEW MEXICO 

The CHAIRMAN. The hearing will please come to order. First, let 

me thank everyone who is here today. I am sure you know that 

this is a very significant hearing and a lot of people in the audience 

have strong feelings about it. But we are not here for any show of 

strength by anybody in the audience. We know you are here, but 

we do not need any audience participation. And so I hope you will 

accommodate us in that regard. 

I circulated a short list reflecting the fact that we are going to 

consider today, if we can—if we get twelve people, I am going to 

say it now, so if that happens, Senator Bingaman, if it is noted at 

any time, then we are going to proceed with the five pending nominees. I think you are all aware of them, but in case you are not, 

I would ask the staff to circulate to you their names. 

If any Senators want any discussion on them, I would appreciate 

it if you would indicate that to me quickly, because as soon as we 

have requisite Senators, I am going to ask Senator Bingaman to 

move with reference to them. For the witnesses, that is just our 

own regular business. 

I want to first thank the witnesses for taking time off their busy 

schedules to come here to provide us with their views. I commented 

to Senator Bingaman, when the energy bill was being considered 

on the floor, to have this hearing. It will not be the last hearing 

on this subject, but certainly for our committee, it is the first and 

it is very important. 

At the time we discussed this, Senator Bingaman and I were engaged in serious discussions about what we might agree should be 

done about the issue of climate change. I have come to accept that 

something is happening with the earth’s climate. I am aware that 

many in the scientific community are warning us that something 

needs to be done. 

I am also aware that there are other qualified members of the 

scientific community who do not share those views, and probably 

even more who are concerned that anything we do will significantly 

2

affect our economy and even our way of life, and also suggest that 

maybe whatever we do will not have any impact. So as I said, we 

are going to have additional hearings, and hear from those witnesses who have different views from what we are going to hear 

today. 

I believe that prudence warns that we consider this issue, that 

we hear from scientists, and we hear from economists about exactly 

what the role of humans is in all of this, and what the impact will 

be if we decide to address it. And what it might be if we decide 

to do nothing. So what, how, who, and when seem, to me, to be 

questions that have to be answered in my mind. These are the 

questions that this hearing and subsequent hearings will help me 

answer. That is what, how, who, and when. 

With that, we are going to begin the search for answers. Many 

already think the answers are there, and that we should have already drawn conclusions and acted. I think, however, everyone 

knows this is a very, very important scientific issue, and that the 

results are very important and solutions are very important. 

I hope this committee understands that we intend to move ahead 

with a series of activities that will put us into the middle of this 

issue, and then we will see how it comes out. 

With that, I yield to my friend and colleague from New Mexico, 

Senator Bingaman, who has an opening statement. 

[The prepared statements of Senators Corzine, Bunning and 

Feinstein follow:]

PREPARED STATEMENT OF HON. JON S. CORZINE, U.S. SENATOR FROM NEW JERSEY

Mr. Chairman, I would first like to thank you for holding this hearing on one of 

the most pressing issues facing our planet—climate change. And Senator Bingaman, 

you have been a major proponent of effective climate change policy and I want to 

thank you for your leadership in this area. 

The world’s leading scientists have linked the burning of fossil fuels to global 

warming that threatens our environment, our health, and our future. The threat of 

global warming is real and needs to be addressed. I am pleased that a resolution 

put forth by Senator Bingaman expressing the sense of the Senate that the Senate 

must take action to address climate change recently passed on a bipartisan basis. 

While this is a step in the right direction, it is absolutely imperative that Congress 

take bigger leaps forward to implement a comprehensive, thoughtful policy that effectively addresses global warming 

Massive amounts of evidence show that average global temperatures are rising. 

Part of this increase is natural. Temperatures do vary over short and long terms. 

Many opponents of climate change legislation argue incorrectly that the changes in 

global temperature are due to these naturally occurring fluctuations. In an attempt 

to bolster their claim they cite a ‘‘medieval heat wave.’’ They fail to mention, however, that scientific documentation distinguishes between natural climate variability 

and human induced climate change. Scientists have conducted a number of studies 

that indicate the climate change observed over the 20th century is due to a combination of factors—including changes in solar radiation, volcanic activity, land-use 

change, and increases in atmospheric greenhouse gases. Of these, the increase in 

greenhouse gases has been the dominant driver of climate change over the past few 

decades. And we have the technology to change that. If we have the will, we can 

lower the amount of greenhouse gasses released into our environment. 

I have long been a proponent of legislation that would counter this problem and 

encourage reductions of greenhouse gas emissions. My advocacy on behalf of climate 

change legislation is not limited to the current Congress. Senator Brownback and 

I led the way to passing a greenhouse gas registry and reporting amendment to the 

Energy Bills in the 107th and 108th Congresses. M. Chairman, the current voluntary programs encourage reductions from only a small group of industry leaders, 

and have little to no effect on most of the economy. Despite these well-intended programs, greenhouse gas emissions have risen on average one percent per year for the 

last several years. We can do better. I am disappointed that the bill passed by the 

3

House this Congress included absolutely no language concerning climate change and 

the Senate bill did not include enough. The lack of effective climate change policy 

is big part of why I voted against the Senate Energy Bill. 

The potential effects of global warming are dire for my state. If we do not control 

climate change, New Jersey could face a receding coastline along the shore, loss of 

habitat in our beautiful beach towns like Cape May, and more extreme weather 

events such as storms and flooding. This will also impact New Jersey’s economy. If 

our beaches are threatened, and our coastline damaged, New Jersey will see an economic impact of catastrophic proportions. Our second largest industry, tourism, will 

be devastated. 

This is an issue for New Jersey and the rest of the United States, but it is also 

an issue for the world. In fact, the United States lags far behind all of the G8 countries in addressing climate change. Thankfully, British Prime Minister Tony Blair 

made this issue central in the meeting of the Group of 8. The science is increasingly 

clear that greenhouse gas emissions produced by humans are changing the earth’s 

climate. It is also eminently clear the rest of the industrialized world understands 

the danger of this problem. Unless Congress acts, the effects of global warming may 

be devastating to the worldwide economy and environment. Recognition by the Senate that global warming is indeed a problem is a meaningful and important first 

step. However, we can not stop here. Congress needs to act boldly and pass additional legislation that counters this problem. History will surely judge this body 

harshly if we fail to do so. 

Again, I thank the Chairman and Ranking Member for allowing this Committee 

the chance to hear from these witnesses before us about this crucial topic and I look 

forward to their testimonies. 

PREPARED STATEMENT OF HON. JIM BUNNING, U.S. SENATOR FROM KENTUCKY

Mr. Chairman, thank you. I look forward to the hearing today to discuss the 

science behind the changes in our planet’s climate. We have all heard from many 

scientists about disputes over the scientific evidence. We could all debate the science 

of climate change all day and still not agree on how nature has worked to warm 

the earth and what role humans play, if any, in that warming. 

We need to be careful of moving too quickly in addressing climate change. Some 

groups have proposed mandatory caps; I do not believe they are the answer. But 

I think it is clear from the comments of the witnesses before the committee today 

that the scientific consensus—at least in this room—is that the most important action that can be taken is to immediately move to low emission technology and improve energy efficiency. 

This is precisely what we have done in the Senate. We have been addressing the 

climate issue with a variety of immediate-impact policies. I have authored bills and 

fought for provisions in the energy bill to expand Clean Coal Technology. Over half 

of our nation’s electricity comes from coal power plants and adopting new and cleaner technology would lead to significant emissions reductions. In fact, the United 

States is expected to reduce its greenhouse gas emissions by 14% by 2012 without 

any new regulations on emissions. 

We have seen good results in improving energy efficiency in the last decade. Since 

1990, U.S. industry has improved its energy efficiency by 20%. Our automobiles are 

becoming more efficient also, running at a higher fuel efficiency today than they did 

just a few years ago. 

I thank the witnesses for appearing before the committee today and appreciate 

their comments. I look forward to continuing the conversation on this issue and discussing the entire scope of climate science. 

PREPARED STATEMENT OF HON. DIANNE FEINSTEIN, U.S. SENATOR FROM CALIFORNIA

Mr. Chairman, I would like to begin by thanking you and Senator Bingaman for 

holding this hearing. I am extremely pleased that Senator Domenici, in particular, 

has recognized that climate change is happening and that it is time we do something about it. 

I hope that this hearing provides the answers that some of my colleagues are 

looking for in order to pass a bill that will establish a mandatory cap on greenhouse 

gas emissions. 

As many of my colleagues know, I was extremely disappointed that the McCain/

Lieberman amendment to the energy bill failed. I believe that this country must act 

aggressively today to reduce the impacts of global warming. 

4

And I think the McCain/Lieberman proposal provides the legislative framework 

we need to address climate change. 

And the reason I believe that is because it is the only policy out there that has 

a real, mandatory cap on greenhouse gas emissions. 

The scientists here today will describe what ‘‘business as usual’’ will mean in 

terms of global warming. But I would like to talk about the impacts of inaction and 

the huge costs of inaction on my state of California. 

Since 1900, California has warmed by 2 degrees Fahrenheit. Annual precipitation 

has decreased over much of the state—by 10 percent to 25 percent in many areas. 

The Environmental Protection Agency estimates that the temperature in California 

could rise by as much as 5 degrees by the end of this century if the current global 

warming trends continue. 

Increased temperatures will impact the State’s water supplies. The Sierra Nevada 

snowpack provides the largest source of water for California. The snowpack equals 

about half the storage capacity of all of California’s man-made reservoirs. It is estimated that the shrinking of the snowpack could eliminate the water source for 16 

million people—equal to all of those in the Los Angeles Basin. 

We have already begun to see a decrease in the Sierra Nevada snowpack due to 

warmer winter storms that bring more rain than snow and also cause premature 

melting of the snowpack. 

If just a third of the snow pack is lost, it would mean losing enough water to serve 

8 million households. So this is really a major problem. 

Even if we take strong action now to reduce our greenhouse gas emissions, it is 

estimated that 27 percent snowpack will remain in the Sierras at the end of the 

century. 

However, if we do nothing to reduce our greenhouse gas emissions, there will only 

be 11 percent of the snowpack left in the Sierras at the end of the century. This 

will be catastrophic not only to California’s water supply, but also to the State’s agricultural industry. 

That is why I believe we must take strong action today to curb our greenhouse 

gas emissions. I hope that this hearing will convince my colleagues of that as well. 

Thank you, Mr. Chairman.

STATEMENT OF HON. JEFF BINGAMAN, U.S. SENATOR

FROM NEW MEXICO 

Senator BINGAMAN. Thank you very much, Mr. Chairman, for 

having the hearing. This is something which you and I discussed, 

and I particularly appreciate you doing it at this point, when we 

are right in the midst of trying to deal with this comprehensive energy bill that we are in a conference with the House about. 

I do think this climate change issue, greenhouse gas emissions 

and climate change, are as significant an issue as we will deal with 

in the Congress, and I hope very much that this hearing, as you 

say, will be the beginning of a deliberative process that will lead 

to a responsible action by us. 

I also want to thank the witnesses. We have a very distinguished 

group of witnesses that have come, some of them from a long way 

to be here. We very much appreciate their going to the extra trouble of being here. We look forward very much to their testimony. 

And as you say, I think the purpose, as I see this, is to educate 

all of us on what is possible, what is needed, what the facts are. 

I think this is an issue, like many in our political process, where 

there is a tendency for us to jump to conclusions and preconceived 

opinions without really adequately understanding the facts, and 

hopefully this hearing will help us avoid that in this case. Thank 

you. 

The CHAIRMAN. Thank you very much. Now Senators, we have 

now quite a number of you here. I would ask you how you think 

we should proceed. I want you to know that both Senator BingaVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00008 Fmt 6633 Sfmt 6602 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
5

man and I have a great number of things to do today, but we can 

spend most of the morning here. Senator Bingaman cannot. 

Senator BINGAMAN. No. I can be here all morning. I just thought 

that the sooner we get to the witnesses, the better. 

The CHAIRMAN. In light of the fact that we cannot go on beyond 

noon, I would not like to do that, because we cannot be here, I wonder what your pleasure—would you like to make opening statements, any Senators on our side? 

Senator MARTINEZ. I would like to put my opening statement on 

the record. 

[The prepared statement of Senator Martinez follows:]

PREPARED STATEMENT OF HON. MEL MARTINEZ, U.S. SENATOR FROM FLORIDA

Chairman Domenici, I want to thank you for your willingness to hold this important hearing today to discuss the economic impacts of climate change strategies and 

the current state of scientific research in this area. Few issues have a greater impact, or enlist the same type of fervor and passion, as the study of human effects 

on our global atmosphere. Climate change was a focal point of debate as the Senate 

debated the Energy Bill and we were presented a host of solutions that many of 

my colleagues passionately championed to mitigate the impact of releasing greenhouse gases into the air. Today we will hear testimony from a cross-section of our 

national scientific community. According to the National Academy of Sciences, the 

mean global surface temperatures have increased by 0.7 degrees since the early 

1970s. There is a growing consensus that the Earth is in fact warming. 

Serious questions, however, still remain on exactly what course of action we 

should take. And perhaps more importantly, what are the ramifications of our decisions? What percentage of this global warming trend comes from human activity 

and from naturally occurring climactic changes? Considering that most energy experts predict phenomenal growth in the use of fossil fuels from India and China, 

what type of reduction can the U.S. make on emissions of CO2 that will significantly 

affect global temperatures? And finally, what will it cost our economy in jobs and 

lost income to meet global climate objectives? Unfortunately, we do not have finite 

answers to these critical questions. 

There have been some in the science community that have tried to link this 

warming trend with natural disasters like hurricanes, where four major disasters 

have battered Florida in the last 10 months. This notion was especially strong after 

the 2004 hurricane season, when Bonnie, Charley, Frances, and Ivan left a devastating mark on my state that thousands of people are still struggling to recover 

from their ravages. In a recent issue of the Bulletin of the American Meteorological 

Society, several respected climatologists, researchers, and policymakers from the National Hurricane Center, NOAA’s Hurricane Research Division, MIT’s Earth, Atmospheric, and Planetary Sciences, and many others found that ‘‘no connection has been 

found between greenhouse gas emissions and the observed behavior of hurricanes.’’ 

Another respected climatologist from Florida State University, Dr. James O’Brien, 

has stated that the periodic, oceanic phenomenon of the Atlantic Ocean Conveyor 

is the real link between hurricane frequency and intensity. He went on to say in 

an article published in the Orlando Sentinel that ‘‘while it is tempting to blame the 

frequency or intensity of hurricanes on man, we all must remember how variable 

nature is—and specifically in this case, the effect of natural variations on hurricanes’ intensity and frequency is extremely higher than the possibility of man’s interference.’’

Despite the misguided attempts made by some scientists and researchers, we cannot overlook the legitimate, peer-reviewed work of climatologists that are rightly 

concerned about sea levels, the shrinkage of the polar ice cap, and the impact climate change will have on habitat and threatened animal species. I come from a very 

environmentally conscious state, where a large majority of my constituents live in 

coastal areas and are concerned that man-made climate change could potentially 

threaten the beaches and estuaries that make Florida such a unique and beautiful 

place. 

There is no doubt that we cannot ignore this issue and that is why our President 

has aggressively pursued record levels of research and development funding to advance our knowledge on the science of climate change. The Bush Administration has 

committed $6 billion in funding, more than any other nation combined, and has 

committed to an 18 percent reduction in greenhouse gas intensity from 2002 

6

through 2012; meeting this commitment will prevent the release of 500 million metric tons carbon-equivalent emissions into the air. Most recently, Senators Hagel and 

Pryor successfully offered an amendment to the Energy Bill that would authorize 

$2 billion in direct loans, loan guarantees and other incentives for the adoption of 

technologies that reduce greenhouse gas intensity while directing a federal effort to 

implement a national climate change strategy. The President and the Senate are 

acting, but we must continue to push forward. 

Again, Mr. Chairman I want to thank you for holding this important hearing 

today. It is critical that we closely examine the evidence our scientific community 

is providing us on the status of our atmosphere that help us guide our future actions.

The CHAIRMAN. Any other Senators besides Senator Martinez? 

Yes, Senator. 

Senator MURKOWSKI. Mr. Chairman, I just want to make sure 

that my opening statement is included as part of the record. As you 

know, the State of Alaska is kind of the barometer, the bellwether, 

as we are looking at what is happening right now on the ground 

as it relates to climate change. I think it is significant, and I would 

like to make sure that my full comments are included as part of 

the record. 

The CHAIRMAN. Senator, I understand your very grave concern 

about this matter, and it will be made a part of the record, you are 

assured. 

[The prepared statement of Senator Murkowski follows:]

PREPARED STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR FROM ALASKA

I’ve tried to be brief in the past in my opening statements. I hope that will buy 

me some leeway today. 

Coming from Alaska, which may be the state most affected in the U.S. by future 

climate change, I have a great deal of interest in this issue. 

I start by saying that I have a firm belief that something is going on out there. 

There is considerable anecdotal and scientific evidence from Alaska that we have 

been in a prolonged warming cycle for the past three decades. 

Last year was the warmest in Alaska in recorded history, with temperatures averaging 5 degrees above normal. 

We’ve seen a general shrinking in glaciers in Alaska, admittedly not in itself proof 

of global warming. 

We’ve seen the extent of the Arctic ice pack fall by at least a million square kilometers from 1970 to 2000, according to at least five studies. And we’ve seen the 

thickness of the pack ice thin. 

We’ve seen permafrost, the frozen soil mixture that underlies much of northern 

Alaska, warm threatening the foundation of roads, buildings and even pipelines. 

Earlier this summer scientists at the University of Alaska found that lakes in Siberia, and more importantly to me near the Tanana Flats and on the Kenai Peninsula in Alaska and in the Yukon Territory, are dropping in size and number because 

thawing permafrost apparently is allowing water to seep out. 

These changes have resulted in a host of biological impacts:

• Perhaps a decline in Alaskan king crab stocks that like cold water; • An increase in spruce bark beetle infestations that have claimed more than 6 

million acres of Alaska spruce since the beetles survive better in warmer winters; • We’ve seen birds move to more northern nesting zones; 

• And we’ve had reports from Native North Slope villagers that subsistence harvests are becoming more difficult for everything from polar bears and walrus 

to whales, because of the shrinking pack ice.

The warming temperatures and receding of the pack ice is intensifying the effects 

of winter storms, increasing coastal erosion. On the North Slope of Alaska in the 

National Petroleum Reserve there is a wonderful area for waterfowl nesting north 

of Teshekpuk Lake. Some worry the area may be harmed by future oil development. 

But the far bigger concern is that coastal erosion will devastate and inundate this 

prized breeding, nesting and molting area for waterfowl. 

The Intergovernmental Panel on Climate Change last year projected that average 

global surface temperatures will continue to rise by between 1.4 and 5.8 degrees 

7

centigrade above 1990 levels by the end of this century. Some models indicate that 

could translate into a far higher temperature hike in the high Arctic, especially in 

winter. 

But then we hear from University of Alaska researchers that Arctic/Beaufort Sea 

temperatures actually fell last summer for the first time in 29 years. 

The science on why the climate has been warming is far from conclusive. 

How much is simply cyclic? 

How much is man-induced? 

Is it largely driven by the increase in greenhouse gases? 

How much of that rise can we realistically arrest given a growing global population? 

1) Clearly we have seen similar or higher increases in temperatures in the Arctic, 

and across the planet, at least on four other occasions during the past 400,000 

years—and none of the previous temperature changes were caused by man. 

2) Climate trends certainly look very different, depending upon the time scale that 

is being considered. So much of the fear over climate is based on data from just the 

past 100 years—a period when admittedly carbon dioxide levels have risen, from 

280 parts per million before the industrial revolution to more than 375 ppm today. 

But what is the evidence, compared to supposition and theory, that that rise is truly 

what is fueling current climate conditions? 

3) While the Arctic Climate Impact Assessment, sponsored by the Arctic Council, 

last year suggested that greenhouse gases are triggering climate change, there is 

credible evidence that, as George Taylor, a climatologist at Oregon State University 

says, a cyclic increase in solar radiation and/or the changes in the North Atlantic 

or Pacific Decadal Oscillations that affect currents and thus sea surface air temperatures and ice thicknesses, may really be what’s at work. 

I am certainly willing to start this debate by acknowledging climate change, but 

I still need have not seen the conclusive evidence that carbon emissions are the sole 

cause of climate change. 

However I am willing to take steps NOW to reduce greenhouse gas releases, as 

a prudent measure—recognizing that we don’t want to devastate our economy, 

harming our ability to pay for environmental protection. 

That is why in the Senate energy bill I co-sponsored an effort by Senator Hagel to spend up to $4 billion to develop technology to sequester carbon and reduce its 

discharge into the atmosphere. 

That is one reason why I’ve been pushing in the energy bill for tax breaks for 

pumping CO2 underground to enhance oil recovery. We keep the carbon out of the 

atmosphere and increase the production of our domestic oil by enhanced oil recovery—a true ‘‘win-win’’ situation for the nation, especially if we can capture up to 

another 42 billion barrels of oil in the process. 

For all these reasons I truly am interested in understanding the impacts of Sen. 

Bingaman’s proposal, patterned after the National Commission on Energy Policy. 

Last month there wasn’t enough time to fully understand the huge implications 

of the concept, how it would affect the economy, foreign output of CO2, the competitiveness of not just our energy sector but of all industries in America. How the initial credits can be equitably distributed, how the price for future emission credits 

may affect the economy, whether the safety value price—$7 per ton—is so low compared to European costs that the system really is meaningless, or whether it will 

become so high that it will have the negative impacts that many in industry have 

complained about. 

In a perfect world I might want to give the President’s February 2002 voluntary 

initiative to reduce greenhouse gas intensity more time to work. (He proposed that 

we cut greenhouse gas intensity by 18 percent by 2012. A level that would emit 500 

million metric tons less carbon to the atmosphere—a responsible goal.) 

But I am open to evidence, that prudence directs us to do more now to reduce 

greenhouse gas emissions. I have much more I could say about the cap and trade 

concept, but for this hearing I’ll simply listen and learn and perhaps speak directly 

to the proposal during a second round of questions or at a future hearing. 

Thank you Mr. Chairman for your indulgence.

Senator AKAKA. Mr. Chairman? 

The CHAIRMAN. Yes, Senator. 

Senator AKAKA. Mr. Chairman, thank you for holding this hearing. I appreciate the consistent attention that this committee has 

given the issue of climate science and adaptation to global climate 

change. In the interest of time, Mr. Chairman, I will submit my 

full statement for the record. 

8

The CHAIRMAN. Thank you very much. 

[The prepared statement of Senator Akaka follows:]

PREPARED STATEMENT OF HON. DANIEL K. AKAKA, U.S. SENATOR FROM HAWAII

Thank you, Mr. Chairman, for scheduling this hearing on climate change and the 

economics of carbon dioxide controls. I appreciate the consistent attention that this 

committee has given to the issue of climate science and adaptation to global climate 

change. Since I joined the committee over 10 years ago, we have held a hearing 

nearly every year on the general topic. 

There is no denying that carbon dioxide in the atmosphere has reached higher 

levels than at any time in the history of the earth. We are implicated—as human 

beings and as a nation—for our role in contributing to the buildup. The burning of 

fossil fuels has accelerated the situation for the last hundred years and the U.S. 

contributes more carbon dioxide to the atmosphere than any other nation. 

I am particularly concerned for islands in the Pacific. There are changes in our 

islands in Hawaii that can only be explained by global phenomena such as the 

buildup of carbon dioxide. Globally, sea level has increased 6 to 14 inches in the 

last century and it is likely to rise another 17 to 25 inches by 2100. This would be 

a one- to two-foot rise. You can imagine what this might mean to port operators, 

shoreline property owners, tourists and residents who use Hawaii’s beautiful beaches, and to island nations and territories in the Pacific whose highest elevation is 

between 3 and 100 meters above sea level. A typhoon or hurricane would be devastating to communities on these islands, not to mention the low-lying coastal wetlands of the continental United States. 

There is an important, but usually overlooked, issue of environmental injustice to 

climate change and sea level rise. In particular, small island states in the Caribbean, such as Nevis, the Cayman Islands, and Bonaire; in the Pacific, islands of 

Vanuatu and the Marshall Islands; or in the Indian Ocean, the Maldives, will bear 

the brunt of climate change in the future, even though they account for less than 

one percent of the greenhouse gas emissions that are driving climate changes. 

I have talked about my concerns regarding climate change on the floor and in this 

committee. I have urged the U.S. to be a leader in addressing climate change and 

carbon emissions. We seem to be mired in inaction—even though the Senate adopted a resolution affirming the reality of climate change in the Senate’s energy bill, 

H.R. 6. I have said in the past that we must not get stuck in estimating the costs

of implementing carbon controls. Inaction may not mean much if you are high and 

dry in the nation’s Capitol, 90 miles from the Atlantic Ocean. But if you are surrounded by water, the risk of inaction is very real, and very frightening. 

We need a different plan of action instead of focusing on the relative costs of carbon containment strategies. I propose that we embrace the just-passed Senate resolution—meaning that we embrace the reality of carbon dioxide accumulation—and 

also embrace the opportunity to use mandatory controls as a way to grow our economy. 

There is no doubt that the engineering communities, think tanks, universities, 

Wall Street and the commodity traders, and industry can pull together to made this 

an opportunity rather than a bleak picture of increased regulation and job loss. This 

can be a national enterprise, a mobilization to contain carbon growth. I would like 

to see a national Commission that would focus on the job growth and technology 

investment needed to limit or reduce greenhouse gases, and the steps needed for 

a strategy to get there. If we embrace this issue as a nation, I am convinced that 

our human resources, technological and scientific expertise, and ‘‘national will’’ can 

beat it and the U.S. can act as a leader for the rest of the world in reducing carbon 

emissions. 

Mr. Chairman, I look forward to hearing the testimony of the distinguished witnesses today, and I have some questions for them.

The CHAIRMAN. Yes, Senator Cantwell? 

Senator CANTWELL. Mr. Chairman, I also submit my statement 

for the record. 

[The prepared statement of Senator Cantwell follows:]

PREPARED STATEMENT OF HON. MARIA CANTWELL, U.S. SENATOR FROM WASHINGTON

Mr. Chairman, thank you for holding this incredibly important hearing. 

I apologize for not being to be here earlier, I had to attend a concurrent Commerce Committee markup. 

9

First I would like to commend Senator Bingaman for his leadership on this issue, 

and his ongoing efforts to develop a bipartisan legislative solution to finally begin 

addressing the enormous challenge global warming poses our nation and our planet. 

And I want to thank the Chairman again for agreeing to undertake this hearings 

process. 

Like many of my colleagues, and most Americans, I have grown increasingly frustrated that, despite overwhelming scientific consensus that climate change is real 

and its consequences will be incredibly harmful to our economy, Congress and the 

President have failed to seriously tackle this issue. 

I was disappointed that we passed a thousand page energy bill out of the Senate, 

but took a pass on dealing directly with one of the central energy challenges of our 

time, the threat of global warming. 

But today is essentially a new beginning to this debate—in part, thanks to the 

fact that the Senate did unanimously adopt a resolution committing us to develop 

a mandatory, national, market-based program to limit greenhouse gas accumulations. While this is a complex challenge, we have many of our brightest minds considering how to best structure such a program. Some of those individuals are testifying before us today, and I thank them for their work. 

We can also learn from the example of our international allies, many of which 

have enacted comprehensive programs to begin addressing this worldwide threat. In 

addition, 28 states and many cities have developed detailed climate change action 

plans and other initiatives to lower future greenhouse gas emissions. 

I am proud that Washington state is one of those states taking the lead. And we 

have good reason to do so. As a number of my colleagues on this Committee are 

aware, the Pacific Northwest is a region totally unique in the way our energy system is structured. Our river—the great Columbia River and its tributaries—is the 

lifeblood of our economy. It produces 80 percent of Washington state’s electricity. 

But it is also the engine of our fishing and farming industries, home to our region’s 

salmon runs, and impacts almost every sector of our economy including navigation 

and recreation. 

Given the low emissions-intensity of our energy system, it is a bitter irony that 

one of the primary impacts of global warming in the Pacific Northwest may be to 

change our rainfall patterns in a way that could shift the dynamics of our great 

river and power system. The Columbia is fed by snowpack, and as a testament to 

the international aspects of this debate, its headwaters are located north of our border, in British Columbia’s Selkirk Mountains. Some scientists, like those at the University of Washington’s Climate Impacts Group, believe that global warming may 

dramatically impact Northwest snowpack by as much as 35 percent in the next 50 

years—compared to the historical averages for 1950 to 1999. 

The Columbia is a river of multiple uses, and as our region has grown the balancing act has become more difficult. Nevertheless, it is a balance that can be 

achieved. I am very concerned, however, about the threat posed to our system by 

climate change. A significant and prolonged shift in our region’s precipitation patterns would not only harm electricity generation, it would also impact billions of dollars of economic infrastructure associated with irrigation systems, municipal water 

supplies, even ski resorts that depend on our historic snowfall patterns. 

I know the Chairman said at the outset that there would be additional hearings 

on this matter, and I do hope that climate adaptation issues—particularly in the 

Northwest—might be an additional focus. As we attempt to weigh the right legislative approach to global warming and the costs of tackling the challenge, we must 

also take a holistic view of those costs. The global warming trend, left unmitigated, 

could severely damage the economy of a region like mine, where the health of our 

river—not to mention the health of our marine ecosystems—are completely intertwined with the fate of many of our most important industries. 

Again, my state’s dynamic highlights the fact that it doesn’t matter where the 

heat-trapping gases originate, they have an impact all over the world. 

This point was made clear to me when I visited a global atmosphere monitoring 

station on the very southern tip of the African continent. Overlooking the vast ocean 

toward Antarctica, this little station on a cliff is able to detect the greenhouse gas 

emissions generated from all over the Northern Hemisphere and provide data to 

help calculate the warming they are causing. 

Mr. Chairman, our nation is responsible for a full quarter of the burden climate 

change will cause our world. We are potentially talking about billions, if not trillions, of dollars in cumulative economic dislocation, and risking millions of lives in 

the developing world due to increased extreme weather events, shifts in disease patterns, and failure of subsistence farming. 

That’s why I believe we must act and put in place a comprehensive program to 

begin reversing this threat as soon as possible. 

10

We are a problem-solving nation. When we are faced with a grave threat, we roll 

up our sleeves, put our heads together, and fix our problems; we don’t push them 

off on our children and future generations. 

Again, thank you for holding this important hearing.

Senator CANTWELL. And if I could inquire if it’s your intention 

to then vote on the action of the hearing at the time that we receive a quorum? 

The CHAIRMAN. The five nominees? 

Senator CANTWELL. Yes. 

The CHAIRMAN. Absolutely. But they have to be present all at 

one time. So if people leave, that is not going to count. We have 

to have 12 present. And then they are already before the Senate. 

I have just made them part of the Senate. We have had hearings. 

The hearings are closed. We have noted no objection heretofore, so 

that is how we will proceed, Senator. 

Senator CANTWELL. Okay. 

The CHAIRMAN. Senator Salazar. 

Senator SALAZAR. Mr. Chairman, thank you, and thanks, Senator 

Bingaman, for this important hearing. And I, too, will have a statement for the record. Thank you. 

The CHAIRMAN. All right. 

[The prepared statement of Senator Salazar follows:]

PREPARED STATEMENT OF HON. KEN SALAZAR, U.S. SENATOR FROM COLORADO

Thank you, Mr. Chairman. I’d like to thank you and Senator Bingaman for your 

desire to work together in the search for effective climate change legislation—legislation that will move America in the right direction by reducing our greenhouse gas 

emissions. 

The issue at hand is an important one. We need to address the problem of climate 

change and greenhouse gas emissions, and the problem is growing more urgent 

every year. We need to find a solution that, as stated in the Sense of the Senate 

Resolution passed earlier this year, ‘‘will not significantly harm the United States 

Economy.’’ I am certain that an economically modest strategy is possible. 

The Senate version of the energy bill, currently in conference, makes some steps 

forward, by slowly but significantly increasing our production of renewable fuels and 

renewable energy. As the Chairman as already indicated, the Senate Energy bill 

also includes some important incentives designed to reduce greenhouse gas emissions by encouraging the development of new, clean energy technologies. I sincerely 

hope these excellent provisions will remain in the energy bill. These provisions will 

serve America well, reducing our greenhouse gas emissions while strengthening our 

energy security. 

But these provisions will not be enough, and that is why meaningful climate 

change legislation is needed. I am looking forward to a rational, and factual, discussion of the problem at hand. In particular, the economic panel will address concerns 

regarding the cost of climate change legislation and its potential effect on various 

industries. There are naysayers, who loudly state that any type of climate change 

legislation would be devastating on our economy, but those individuals are misinformed. I believe industries important to Colorado and to America—such as coal—

will continue to thrive under good climate change legislation, and I look forward to 

examining that further in our discussion here today.

The CHAIRMAN. We are ready. Then any other Senators that arrive—Senator Talent, the issue is: Do you want to make a statement or put one in the record? 

Senator TALENT. In the record would be fine, Mr. Chairman. 

The CHAIRMAN. All right. We will do that, Senator. 

[The prepared statement of Senator Talent follows:]

11

PREPARED STATEMENT OF HON. JAMES M. TALENT, U.S. SENATOR FROM MISSOURI

I thank the Chairman and Ranking Member for tackling this very difficult issue. 

Like so many of the issues we seem to be facing recently, climate change is one 

where the stakes are high on both sides, a lot of money and forecasting is involved, 

and there is considerable disagreement over the degree of the problem and the likely outcome after all of the money is spent. 

I know a lot of bright minds have spent considerable amounts of time and effort 

studying climate change and, while we’ve been at this a while, the science is relatively new and still has a ways to go to produce the kinds of answers we’d all like 

to have. 

Nevertheless, I expect that what we’ll hear today is that there’s a broad-based 

consensus that,

1. over the last 100 or so years, the temperature of the Earth has risen; 

2. over that same period, the concentration of greenhouse gases such as carbon dioxide has also risen; 

3. because of this correlation, there is evidence that at least some of the temperature rise is attributable to the burning of fossil fuels; and 

4. man, therefore, has some level of ability to mitigate the warming of the 

Earth through controlling greenhouse gas emissions.

I don’t necessarily disagree with these conclusions, though what troubles me is 

the uncertainty that remains with respect to several key factors underlying any conclusions on climate change, namely

1. to what degree is the current warming due to the numerous natural, cyclical changes, some of which are measured over hundreds or thousands of years; 

2. to what degree is the current warming due to the burning of fossil fuels; 

3. how sensitive is the climate to changes in greenhouse gas concentration; 

and 

4. how accurate are the models and the data inputs.

I am curious as to whether, as the science advances, we find that predictions of 

excessive temperature increases are in fact overstated. 

In either case, the presence of a fair bit of uncertainty as to what will in fact happen 50, 75, or 100 years from now, coupled with the global nature of this issue and 

its economic ramifications, makes it much more difficult to heed calls for immediate 

action on climate change. This is particularly true since it is apparent to most that 

the technology needed to make an appreciable dent in global emissions is not yet 

available. 

What worries me the most are calls for partial solutions to problems that are not 

fully defined. For example, one outcome of this debate could be that the United 

States invests billions of dollars to reduce emissions; this cost drives industry and 

jobs overseas, harming our economy while not making any improvement in greenhouse gas concentrations, as developing countries like China and India replace the 

manufacturing formerly done in the U.S. without, of course, any effort to cut emissions. 

If this scenario plays out, we end up losing three times—energy costs go up, jobs 

disappear, and global emissions are not reduced at all. This would be particularly 

painful if we push for this kind of change prior to the technology being in place to 

make it possible without draconian cuts in fossil fuel use, particularly coal. 

In all of this, I am not yet convinced whether we will see any tangible benefits 

for the large sums of money that are at stake here. I understand that there is a 

time when you must make a decision based on the best available information. But 

usually you have some degree of certainty that the chosen option will work, or at 

least that you know its true cost. In this case, I am concerned that there is a great 

deal of uncertainty with respect to both the likelihood of success and the cost to 

achieve it. 

Some view the Kyoto Protocol, which is much more demanding than the Bingaman proposal, as just the beginning, meaning even greater emissions cuts must be 

made. I wonder if anyone has done the math on the cost for going the whole nine 

yards and cutting emissions to the level some say we must get to. I think people 

are afraid of putting that number in print. 

Nevertheless, our energy bill contains a number of incentives for voluntarily 

adopting technology to control emissions both here and abroad. I’m in favor of this 

approach because it’s working already. 

In addition, it’s the only way we can bring developing countries like China and 

India on board. 

The electric industry has taken a number of steps to meet the Administration’s 

target. Edison Electric Institute’s members have committed to voluntarily reduce 

12

GHG emissions intensity by 3-5 percent in the next decade. Other sectors of the 

economy made similar commitments in order to help meet the President’s goal of 

18 percent. Specifically, in the last 10 years, they have reduced, avoided, or sequestered 7 million tons of carbon dioxide system wide and are committed to doing more. 

Plus, several utilities, including utilities in my state, are planning to build new coal 

fired generators using the latest proven clean coal technology. 

I hope as we go forward we will be able to find solutions that recognize that economic growth and prosperity are the best means of achieving environmental protection.

The CHAIRMAN. Can we have panel number one come to the 

table? Dr. Ralph Cicerone, Dr. Mario Molina, Dr. Jim Hurrell, Sir 

John Houghton. Could you tell me your name again, Doctor? Say 

it for me. 

Sir HOUGHTON. Houghton. 

The CHAIRMAN. Houghton. 

Sir HOUGHTON. Correct. 

The CHAIRMAN. I will never get it right, but pretty close. Now I 

do not have to tell everybody who you are. I would not have to. But 

I think it is important that we just quickly state it. 

Dr. Ralph Cicerone is president of the National Academy of 

Sciences and chairman of the National Research Council. Dr. Mario 

Molina is a professor of Earth, Atmospheric and Planetary Sciences 

at the Massachusetts Institute of Technology. Dr. Hurrell is a scientist with Science Climate and Global Dynamics. And then our 

friend from England, Sir Houghton, is co-chairman of the Scientific 

Assessment Workshop, Intergovernmental Panel on Climate 

Change. 

Now we are going to proceed in the order which I called your 

names, if you will. We are very interested in what you have to say. 

On the other hand, we want everybody on this panel to have an 

opportunity to inquire. So with that, would you keep your statements as brief as possible. 

Right now, we will inform each of you that whatever statement 

you have brought to us will be made a part of the record. Having 

said that, if you can abbreviate, fine. If you cannot, we expect to 

let you tell us exactly what you want. And how you want to say 

it is up to you. Please proceed. We will go with you first, Doctor. 

Dr. CICERONE. Oh. Okay. 

The CHAIRMAN. In the order that I called the names. 

STATEMENT OF RALPH J. CICERONE, PH.D., PRESIDENT, 

NATIONAL ACADEMY OF SCIENCES 

Dr. CICERONE. Thank you, Senator Domenici. My name is Ralph 

Cicerone. I am president of the National Academy of Sciences, as 

of about 3 weeks ago. I certainly appreciate the opportunity to be 

here. There is no question that energy, energy technology, energy 

usage patterns are very central to implications of climate change. 

So your attention is certainly necessary and highly desirable from 

everybody’s point of view. 

This morning I would like to summarize briefly the current state 

of scientific understanding on climate change, based largely on 

findings and recommendations in recent National Academies reports. These reports are the products of study processes that bring 

together leading scientists, engineers, public health officials, and 

13

other experts to provide consensus readings and advice to the Nation on specific scientific and technical questions. 

The earth is warming. Weather station records and ship-based 

observations for about the last 130, 140 years indicate that global 

mean surface air temperature increased, just since the 1970’s, 

about 7⁄10 of a degree Fahrenheit. In my written testimony, which 

you were kind enough to include, I have a figure of such data, a 

graph. 

The magnitude of the warming does vary locally and from region 

to region. However, the warming trend is spatially widespread, 

planetary, and it is consistent with an array of other evidence, including melting glaciers and ice caps, sea-level rise, extended growing seasons, and changes in geographical distributions of plant and 

animal species. 

The ocean, which represents, because of the heat capacity of 

water, the largest reservoir of heat in the climate system, has itself 

warmed by about .12 degrees Fahrenheit, average down to 750 feet 

depth just in the last 12 years. And recent studies have shown that 

the observed heat storage in the ocean is consistent with the expected impacts of the human-enhanced greenhouse effect. 

The observed warming, however, has not proceeded at a uniform 

rate. For example, there was a bit of a cooling, especially in the 

northern hemisphere from 1940 to 1975, warming until 1940, and 

then a much more rapid warming since the late 1970’s. 

Laboratory measurements of gases that have been extracted from 

dated ice cores have shown that for the last hundreds of thousands 

of years changes in temperature have closely tracked atmospheric 

carbon dioxide amounts, and that carbon dioxide in the atmosphere 

is now at its highest level in 400,000 years, as it continues to rise. 

Nearly all climate scientists today believe that much of the 

earth’s current warming has been caused by increases in these 

greenhouse gases in the atmosphere, mostly from the burning of 

fossil fuels. And the degree of confidence in this conclusion is higher today than it was 10 years ago or even 5 years ago, and yet, uncertainties do remain. 

As stated in our 2001 National Academy of Sciences report, the 

changes observed over the last several decades are likely mostly 

due to human activities, but we cannot rule out that some significant part of these changes also reflects natural variability. 

An example of an area of debate of a natural cause of this warming has involved a question of whether or not the sun itself has 

brightened. Fortunately, in the last 25 years or so, humans have 

measured the output of the sun carefully enough, with enough precision, to shed some light on the question. And although there are 

still uncertainties due to stringing together records from different 

instruments and different satellites, the most empirical reading of 

the record, I believe, shows that the sun’s output has not changed. 

There has been no trend, aside from the 11-year cycles which were 

previously known. And, therefore, it is much more difficult to say 

today that the sun’s brightening has been the cause of the warming. It does not command much credence. 

As you know, carbon dioxide can remain in the atmosphere for 

many decades, and some part of the climate system respond slowly 

to these changes, so that we can predict confidently that this 

14

* The figure has been retained in committee files. 

warming will continue even though other forces are at play. And 

the emissions to be—for the concentrations in the atmosphere to be 

stabilized would require a long-term attack on emissions. 

The simulations of future climate change, which I hope that 

other witnesses speak about more, are that global surface temperatures will continue to rise, and that in the coming century, the 

present century, the rises could be from 21⁄2 to about 10 degrees 

Fahrenheit above 1990 temperatures. 

This range reflects not only uncertainties as to details of the climate system, but also uncertainties in future human behavior. 

How many people will there be? What will our energy consumption 

patterns be? And what will our sources of energy be? 

We have discussed in many of our reports remaining scientific 

uncertainties, what kinds of research are needed. One of the most 

telling is having to do with regional and local climate changes, 

where prediction is much more difficult, and yet it is where people 

want to know what will happen very clearly. 

The possible changes and the frequency of severe events like 

droughts and temperature extremes and water needs and electrical 

needs that flow from those extreme events represent some of the 

most difficult to predict phenomena. 

In my written testimony I go on and summarize more of the current state of scientific understanding, and give a lot of references. 

With your permission I will stop here and be available to answer 

any questions that I may. Thank you, Senator Domenici. 

The CHAIRMAN. Thank you very much. 

[The prepared statement of Dr. Cicerone follows:]

PREPARED STATEMENT OF RALPH J. CICERONE, PH.D., PRESIDENT,

NATIONAL ACADEMY OF SCIENCES

Good morning, Mr. Chairman and members of the Committee. My name is Ralph 

Cicerone, and I am President of the National Academy of Sciences. Prior to this position, I served as Chancellor of the University of California at Irvine, where I also 

held the Daniel G. Aldrich Chair in Earth System Science. In addition, in 2001 I 

chaired the National Academies committee that wrote the report, Climate Change 

Science: An Analysis of Some Key Questions, at the request of the White House. 

This morning I will summarize briefly the current state of scientific understanding on climate change, based largely on the findings and recommendations in 

recent National Academies’ reports. These reports are the products of a study process that brings together leading scientists, engineers, public health officials and 

other experts to provide consensus advice to the nation on specific scientific and 

technical questions. 

The Earth is warming. Weather station records and ship-based observations indicate that global mean surface air temperature increased about 0.7° F (0.4° C) since 

the early 1970’s (See Figure*). Although the magnitude of warming varies locally, 

the warming trend is spatially widespread and is consistent with an array of other 

evidence (including melting glaciers and ice caps, sea level rise, extended growing 

seasons, and changes in the geographical distributions of plant and animal species). 

The ocean, which represents the largest reservoir of heat in the climate system, has 

warmed by about 0.12° F (0.06° C) averaged over the layer extending from the surface down to 750 feet, since 1993. Recent studies have shown that the observed heat 

storage in the oceans is consistent with expected impacts of a human-enhanced 

greenhouse effect. 

The observed warming has not proceeded at a uniform rate. Virtually all the 20th 

century warming in global surface air temperature occurred between the early 

1900s and the 1940s and from the 1970s until today, with a slight cooling of the 

Northern Hemisphere during the interim decades. The causes of these irregularities 

and the disparities in the timing are not completely understood, but the warming 

15

trend in global-average surface temperature observations during the past 30 years 

is undoubtedly real and is substantially greater than the average rate of warming 

during the 20th century. 

Laboratory measurements of gases trapped in dated ice cores have shown that for 

hundreds of thousands of years, changes in temperature have closely tracked atmospheric carbon dioxide concentrations. Burning fossil fuel for energy, industrial processes, and transportation releases carbon dioxide to the atmosphere. Carbon dioxide 

in the atmosphere is now at its highest level in 400,000 years and continues to rise. 

Nearly all climate scientists today believe that much of Earth’s current warming 

has been caused by increases in the amount of greenhouse gases in the atmosphere, 

mostly from the burning of fossil fuels. The degree of confidence in this conclusion 

is higher today than it was 10, or even 5 years ago, but uncertainties remain. As 

stated in the Academies 2001 report, ‘‘the changes observed over the last several 

decades are likely mostly due to human activities, but we cannot rule out that some 

significant part of these changes is also a reflection of natural variability.’’

One area of debate has been the extent to which variations in the Sun might contribute to recent observed warming trends. The Sun’s total brightness has been 

measured by a series of satellite-based instruments for more than two complete 11-

year solar cycles. Recent analyses of these measurements argue against any detectable long-term trend in the observed brightness to date. Thus, it is difficult to conclude that the Sun has been responsible for the warming observed over the past 25 

years. 

Carbon dioxide can remain in the atmosphere for many decades and major parts 

of the climate system respond slowly to changes in greenhouse gas concentrations. 

The slow response of the climate system to increasing greenhouse gases also means 

that changes and impacts will continue during the 21st century and beyond, even 

if emissions were to be stabilized or reduced in the near future. 

Simulations of future climate change project that, by 2100, global surface temperatures will be from 2.5 to 10.4° F (1.4 to 5.8° C) above 1990 levels. Similar projections of temperature increases, based on rough calculations and nascent theory, 

were made in the Academies first report on climate change published in the late 

1970s. Since then, significant advances in our knowledge of the climate system and 

our ability to model and observe it have yielded consistent estimates. Pinpointing 

the magnitude of future warming is hindered both by remaining gaps in understanding the science and by the fact that it is difficult to predict society’s future actions, particularly in the areas of population growth, economic growth, and energy 

use practices. 

Other scientific uncertainties about future climate change relate to the regional 

effects of climate change and how climate change will affect the frequency and severity of weather events. Although scientists are starting to forecast regional weather impacts, the level of confidence is less than it is for global climate projections. 

In general, temperature is easier to predict than changes such as rainfall, storm 

patterns, and ecosystem impacts. 

It is important to recognize however, that while future climate change and its impacts are inherently uncertain, they are far from unknown. The combined effects of 

ice melting and sea water expansion from ocean warming will likely cause the global 

average sea-level to rise by between 0.1 and 0.9 meters between 1990 and 2100. In 

colder climates, such warming could bring longer growing seasons and less severe 

winters. Those in coastal communities, many in developing nations, will experience 

increased flooding due to sea level rise and are likely to experience more severe 

storms and surges. In the Arctic regions, where temperatures have risen more than 

the global average, the landscape and ecosystems are being altered rapidly. 

The task of mitigating and preparing for the impacts of climate change will require worldwide collaborative inputs from a wide range of experts, including natural 

scientists, engineers, social scientists, medical scientists, those in government at all 

levels, business leaders and economists. Although the scientific understanding of climate change has advanced significantly in the last several decades, there are still 

many unanswered questions. Society faces increasing pressure to decide how best 

to respond to climate change and associated global changes, and applied research 

in direct support of decision making is needed. 

My written testimony describes the current state of scientific understanding of climate change in more detail, based largely on important findings and recommendations from a number of recent National Academies’ reports. 

THE EARTH IS WARMING

The most striking evidence of a global warming trend are closely scrutinized data 

that show a relatively rapid increase in temperature, particularly over the past 30 

16

years. Weather station records and ship-based observations indicate that global 

mean surface air temperature increased about 0.7° F (0.4° C) since the early 1970’s. 

Although the magnitude of warming varies locally, the warming trend is spatially 

widespread and is consistent with an array of other evidence (e.g., melting glaciers 

and ice caps, sea level rise, extended growing seasons, and changes in the geographical distributions of plant and animal species). 

The ocean, which represents the largest reservoir of heat in the climate system, 

has warmed by about 0.12° F (0.06° C) averaged over the layer extending from the 

surface down to 750 feet, since 1993. Recent studies have shown that the observed 

heat storage in the oceans is what would be expected by a human-enhanced greenhouse effect. Indeed, increased ocean heat content accounts for most of the planetary 

energy imbalance (i.e., when the Earth absorbs more energy from the Sun than it 

emits back to space) simulated by climate models with mid-range climate sensitivity. 

The observed warming has not proceeded at a uniform rate. Virtually all the 20th 

century warming in global surface air temperature occurred between the early 

1900s and the 1940s and since the 1970s, with a slight cooling of the Northern 

Hemisphere during the interim decades. The troposphere warmed much more during the 1970s than during the two subsequent decades, whereas Earth’s surface 

warmed more during the past two decades than during the 1970s. The causes of 

these irregularities and the disparities in the timing are not completely understood. 

A National Academies report released in 2000, Reconciling Observations of Global 

Temperature Change, examined different types of temperature measurements collected from 1979 to 1999 and concluded that the warming trend in global-average 

surface temperature observations during the previous 20 years is undoubtedly real 

and is substantially greater than the average rate of warming during the 20th century. The report concludes that the lower atmosphere actually may have warmed 

much less rapidly than the surface from 1979 into the late 1990s, due both to natural causes (e.g., the sequence of volcanic eruptions that occurred within this particular 20-year period) and human activities (e.g., the cooling of the upper part of 

the troposphere resulting from ozone depletion in the stratosphere). The report 

spurred many research groups to do similar analyses. Satellite observations of middle troposphere temperatures, after several revisions of the data, now compare reasonably with observations from surface stations and radiosondes, although some uncertainties remain. 

HUMANS HAVE HAD AN IMPACT ON CLIMATE

Laboratory measurements of gases trapped in dated ice cores have shown that for 

hundreds of thousands of years, changes in temperature have closely tracked with 

atmospheric carbon dioxide concentrations. Burning fossil fuel for energy, industrial 

processes, and transportation releases carbon dioxide to the atmosphere. Carbon dioxide in the atmosphere is now at its highest level in 400,000 years and continues 

to rise. Nearly all climate scientists today believe that much of Earth’s current 

warming has been caused by increases in the amount of greenhouse gases in the 

atmosphere. The degree of confidence in this conclusion is higher today than it was 

10, or even 5 years ago, but uncertainties remain. As stated in the Academies 2001 

report, ‘‘the changes observed over the last several decades are likely mostly due to 

human activities, but we cannot rule out that some significant part of these changes 

is also a reflection of natural variability.’’

Carbon dioxide can remain in the atmosphere for many decades and major parts 

of the climate system respond slowly to changes in greenhouse gas concentrations. 

The slow response of the climate system to increasing greenhouse gases also means 

that changes and impacts will continue during the 21st century and beyond, even 

if emissions were to be stabilized or reduced in the near future. 

In order to compare the contributions of the various agents that affect surface 

temperature, scientists have devised the concept of ‘‘radiative forcing.’’ Radiative 

forcing is the change in the balance between radiation (i.e., heat and energy) entering the atmosphere and radiation going back out. Positive radiative forcings (e.g., 

due to excess greenhouse gases) tend on average to warm the Earth, and negative 

radiative forcings (e.g., due to volcanic eruptions and many human-produced 

aerosols) on average tend to cool the Earth. The Academies’ recent report, Radiative 

Forcing of Climate Change: Expanding the Concept and Addressing Uncertainties

(2005), takes a close look at how climate has been changed by a range of forcings. 

A key message from the report is that it is important to quantify how human and 

natural processes cause changes in climate variables other than temperature. For 

example, climate-driven changes in precipitation in certain regions could have significant impacts on water availability for agriculture, residential and industrial use, 

17

and recreation. Such regional impacts will be much more noticeable than projected 

changes in global average temperature of a degree or more. 

One area of debate has been the extent to which variations in the Sun might contribute to recent observed warming trends. Radiative Forcing of Climate Change: 

Expanding the Concept and Addressing Uncertainties (2005) also summarizes current understanding about this issue. The Sun’s brightness—its total irradiance—has 

been measured continuously by a series of satellite-based instruments for more than 

two complete 11-year solar cycles. These multiple solar irradiance datasets have 

been combined into a composite time series of daily total solar irradiance from 1979 

to the present. Different assumptions about radiometer performance lead to different reconstructions for the past two decades. Recent analyses of these measurements, taking into account instrument calibration offsets and drifts, argue against 

any detectable long-term trend in the observed irradiance to date. Likewise, models 

of total solar irradiance variability that account for the influences of solar activity 

features—dark sunspots and bright faculae—do not predict a secular change in the 

past two decades. Thus, it is difficult to conclude from either measurements or models that the Sun has been responsible for the warming observed over the past 25 

years. 

Knowledge of solar irradiance variations is rudimentary prior to the commencement of continuous space-based irradiance observations in 1979. Models of sunspot 

and facular influences developed from the contemporary database have been used 

to extrapolate daily variations during the 11-year cycle back to about 1950 using 

contemporary sunspot and facular proxies, and with less certainty annually to 1610. 

Circumstantial evidence from cosmogenic isotope proxies of solar activity (14C and 10Be) and plausible variations in Sun-like stars motivated an assumption of longterm secular irradiance trends, but recent work questions the evidence from both. 

Very recent studies of the long term evolution and transport of activity features 

using solar models suggest that secular solar irradiance variations may be limited 

in amplitude to about half the amplitude of the 11-year cycle. 

WARMING WILL CONTINUE, BUT ITS IMPACTS ARE DIFFICULT TO PROJECT

The Intergovernmental Panel on Climate Change (IPCC), which involves hundreds of scientists in assessing the state of climate change science, has estimated 

that, by 2100, global surface temperatures will be from 2.5 to 10.4° F (1.4 to 5.8°

C) above 1990 levels. Similar projections of temperature increases, based on rough 

calculations and nascent theory, were made in the Academies first report on climate 

change published in the late 1970s. Since then, significant advances in our knowledge of the climate system and our ability to model and observe it have yielded consistent estimates. Pinpointing the magnitude of future warming is hindered both by 

remaining gaps in understanding the science and by the fact that it is difficult to 

predict society’s future actions, particularly in the areas of population growth, economic growth, and energy use practices. 

One of the major scientific uncertainties is how climate could be affected by what 

are known as ‘‘climate feedbacks.’’ Feedbacks can either amplify or dampen the climate response to an initial radiative forcing. During a feedback process, a change 

in one variable, such as carbon dioxide concentration, causes a change in temperature, which then causes a change in a third variable, such as water vapor, which 

in turn causes a further change in temperature. Understanding Climate Change 

Feedbacks (2003) looks at what is known and not known about climate change 

feedbacks and identifies important research avenues for improving our understanding. 

Other scientific uncertainties relate to the regional effects of climate change and 

how climate change will affect the frequency and severity of weather events. Although scientists are starting to forecast regional weather impacts, the level of confidence is less than it is for global climate projections. In general, temperature is 

easier to predict than changes such as rainfall, storm patterns, and ecosystem impacts. It is very likely that increasing global temperatures will lead to higher maximum temperatures and fewer cold days over most land areas. Some scientists believe that heat waves such as those experienced in Chicago and central Europe in 

recent years will continue and possibly worsen. The larger and faster the changes 

in climate, the more difficult it will be for human and natural systems to adapt 

without adverse effects. 

There is evidence that the climate has sometimes changed abruptly in the past—

within a decade—and could do so again. Abrupt changes, for example the Dust Bowl 

drought of the 1930’s displaced hundreds of thousands of people in the American 

Great Plains, take place so rapidly that humans and ecosystems have difficulty 

adapting to it. Abrupt Climate Change: Inevitable Surprises (2002) outlines some of 

18

the evidence for and theories of abrupt change. One theory is that melting ice caps 

could ‘‘freshen’’ the water in the North Atlantic, shutting down the natural ocean 

circulation that brings warmer Gulf Stream waters to the north and cooler waters 

south again. This shutdown could make it much cooler in Northern Europe and 

warmer near the equator. 

It is important to recognize that while future climate change and its impacts are 

inherently uncertain, they are far from unknown. The combined effects of ice melting and sea water expansion from ocean warming will likely cause the global average sea-level to rise by between 0.1 and 0.9 meters between 1990 and 2100. In colder climates, such warming could bring longer growing seasons and less severe winters. Those in coastal communities, many in developing nations, will experience increased flooding due to sea level rise and are likely to experience more severe 

storms and surges. In the Arctic regions, where temperatures have risen almost 

twice as much as the global average, the landscape and ecosystems are being altered rapidly. 

OBSERVATIONS AND DATA ARE THE FOUNDATION OF CLIMATE CHANGE SCIENCE

There is nothing more valuable to scientists than the measurements and observations required to confirm or contradict hypotheses. In climate sciences, there is a 

peculiar relation between the scientist and the data. Whereas other scientific disciplines can run multiple, controlled experiments, climate scientists must rely on the 

one realization that nature provides. Climate change research requires observations 

of numerous characteristics of the Earth system over long periods of time on a global basis. Climate scientists must rely on data collected by a whole suite of observing 

systems—from satellites to surface stations to ocean buoys—operated by various 

government agencies and countries as well as climate records from ice cores, tree 

rings, corals, and sediments that help reconstruct past change. 

COLLECTING AND ARCHIVING DATA TO MEET THE UNIQUE NEEDS OF

CLIMATE CHANGE SCIENCE

Most of the instrumentation and observing systems used to monitor climate today 

were established to provide data for other purposes, such as predicting daily weather; advising farmers; warning of hurricanes, tornadoes and floods; managing water 

resources; aiding ocean and air transportation; and understanding the ocean. However, collecting climate data is unique because higher precision is often needed in 

order to detect climate trends, the observing programs need to be sustained indefinitely and accommodate changes in observing technology, and observations are 

needed at both global scales and at local scales to serve a range of climate information users. 

Every report on climate change produced by the National Academies in recent 

years has recommended improvements to climate observing capabilities. A central 

theme of the report Adequacy of Climate Observing Systems (1999) is the need to 

dramatically upgrade our climate observing capabilities. The report presents ten climate monitoring principles that continue to be the basis for designing climate observing systems, including management of network change, careful calibration, continuity of data collection, and documentation to ensure that meaningful trends can 

be derived. 

Another key concept for climate change science is the ability to generate, analyze, 

and archive long-term climate data records (CDRs) for assessing the state of the environment in perpetuity. In Climate Data Records from Environmental Satellites

(2004), a climate data record is defined as a time series of measurements of sufficient length, consistency, and continuity to determine climate variability and 

change. The report identifies several elements of successful climate data record generation programs, ranging from effective, expert leadership to long-term commitment to sustaining the observations and archives. 

INTEGRATING KNOWLEDGE AND DATA ON CLIMATE CHANGE THROUGH MODELS

An important concept that emerged from early climate science in the 1980s was 

that Earth’s climate is not just a collection of long-term weather statistics, but rather the complex interactions or ‘‘couplings’’ of the atmosphere, the ocean, the land, 

and plant and animal life. Climate models are built using our best scientific knowledge, first modeling each process component separately and then linking them together to simulate these couplings. 

Climate models are important tools for understanding how the climate operates 

today, how it may have functioned differently in the past, and how it may evolve 

in the future in response to forcings from both natural processes and human activities. Climate scientists can deal with uncertainty about future climate by running 

19

models with different assumptions of future population growth, economic development, energy use, and policy choices, such as those that affect air quality or influence how nations share technology. Models then offer a range of outcomes based on 

these different assumptions. 

MODELING CAPABILITY AND ACCURACY

Since the first climate models were pioneered in the 1970s, the accuracy of models 

has improved as the number and quality of observations and data have increased, 

as computational abilities have multiplied, and as our theoretical understanding of 

the climate system has improved. Whereas early attempts at modeling used relatively crude representations of the climate, today’s models have very sophisticated 

and carefully tested treatment of hundreds of climate processes. 

The National Academies’ report Improving Effectiveness of U.S. Climate Modeling

(2001) offers several recommendations for strengthening climate modeling capabilities, some of which have already been adopted in the United States. At the time 

the report was published, U.S. modeling capabilities were lagging behind some other 

countries. The report identified a shortfall in computing facilities and highly skilled 

technical workers devoted to climate modeling. Federal agencies have begun to centralize their support for climate modeling efforts at the National Center for Atmospheric Research and the Geophysical Fluid Dynamics Laboratory. However, the U.S. 

could still improve the amount of resources it puts toward climate modeling as recommended in Planning Climate and Global Change Research (2003). 

CLIMATE CHANGE IMPACTS WILL BE UNEVEN

There will be winners and losers from the impacts of climate change, even within 

a single region, but globally the losses are expected to outweigh the benefits. The 

regions that will be most severely affected are often the regions that are the least 

able to adapt. For example, Bangladesh, one of the poorest nations in the world, is 

projected to lose 17.5% of its land if sea level rises about 40 inches (1 m), displacing 

tens of thousands of people. Several islands throughout the South Pacific and Indian 

Oceans will beat similar risk of increased flooding and vulnerability to storm surges. 

Coastal flooding likely will threaten animals, plants, and fresh water supplies. Tourism and local agriculture could be severely challenged. 

Wetland and coastal areas of many developed nations including United States are 

also threatened. For example, parts of New Orleans are as much as eight feet below 

sea level today. However, wealthy countries are much more able to adapt to sea 

level rise and threats to agriculture. Solutions could include building, limiting or 

changing construction codes in coastal zones, and developing new agricultural technologies. 

The Arctic has warmed at a faster rate than the Northern Hemisphere over the 

past century. A Vision for the International Polar Year 2007-2008 (2004) reports 

that this warming is associated with a number of impacts including: melting of sea 

ice, which has important impacts on biological systems such as polar bears, ice-dependent seals, and local people for whom these animals are a source of food; increased snow and rainfall, leading to changes in river discharge and tundra vegetation; and degradation of the permafrost. 

PREPARING FOR CLIMATE CHANGE

One way to begin preparing for climate change is to make the wealth of climate 

data and information already collected more accessible to a range of users who could 

apply it to inform their decisions. Such efforts, often called ‘‘climate services,’’ are 

analogous to the efforts of the National Weather Service to provide useful weather 

information. Climate is becoming increasingly important to public and private decision making in various fields such as emergency management planning, water quality, insurance premiums, irrigation and power production decisions, and construction schedules. A Climate Services Vision (2001) outlines principles for improving 

climate services that include making climate data as user-friendly as weather services are today, and active and well-defined connections among the government agencies, businesses, and universities involved in climate change data collection and research. 

Another avenue would be to develop practical strategies that could be used to reduce economic and ecological systems’ vulnerabilities to change. Such ‘‘no-regrets’’ 

strategies, recommended in Abrupt Climate Change: Inevitable Surprises (2002), 

provide benefits whether a significant climate change ultimately occurs or not, potentially reducing vulnerability at little or no net cost. No-regrets measures could 

include low-cost steps to: improve climate forecasting; slow biodiversity loss; improve water, land, and air quality; and make institutions—such as the health care 

20

enterprise, financial markets, and transportation systems—more resilient to major 

disruptions. 

REDUCING THE CAUSES OF CLIMATE CHANGE

The climate change statement issued in June 2005 by 11 science academies, including the National Academy of Sciences, stated that despite remaining unanswered questions, the scientific understanding of climate change is now sufficiently 

clear to justify nations taking cost-effective steps that will contribute to substantial 

and long-term reduction in net global greenhouse gas emissions. Because carbon dioxide and some other greenhouse gases can remain in the atmosphere for many decades and major parts of the climate system respond slowly to changes in greenhouse 

gas concentrations, climate change impacts will likely continue throughout the 21st 

century and beyond. Failure to implement significant reductions in net greenhouse 

gas emissions now will make the job much harder in the future—both in terms of 

stabilizing their atmospheric abundances and in terms of experiencing more significant impacts. 

At the present time there is no single solution that can eliminate future warming. 

As early as 1992, Policy Implications of Greenhouse Warming found that there are 

many potentially cost-effective technological options that could contribute to stabilizing greenhouse gas concentrations. 

MEETING ENERGY NEEDS IS A MAJOR CHALLENGE TO SLOWING CLIMATE CHANGE

Energy—either in the form of fuels used directly (i.e., gasoline) or as electricity 

produced using various fuels (fossil fuels as well as nuclear, solar, wind, and others)—is essential for all sectors of the economy, including industry, commerce, 

homes, and transportation. Energy use worldwide continues to grow with economic 

and population growth. Developing countries, China and India in particular, are 

rapidly increasing their use of energy, primarily from fossil fuels, and consequently 

their emissions of CO2. Carbon emissions from energy can be reduced by using it 

more efficiently or by switching to alternative fuels. It also may be possible to capture carbon emissions from electric generating plants and then sequester them. 

Energy efficiency in all sectors of the U.S. economy could be improved. The 2002 

National Academies’ report, Effectiveness and Impact of Corporate Average Fuel 

Economy (CAFE) Standards, evaluates car and light truck fuel use and analyzes 

how fuel economy could be improved. Steps range from improved engine lubrication 

to hybrid vehicles. The 2001 Academies report, Energy Research at DOE, Was It 

Worth It? addresses the benefits of increasing the energy efficiency of lighting, refrigerators and other appliances. Many of these improvements (e.g., high-efficiency 

refrigerators) are cost-effective means to significantly reducing energy use, but are 

being held back by market constraints such as consumer awareness, higher initial 

costs, or by the lack of effective policy. 

Electricity can be produced without significant carbon emissions using nuclear 

power and renewable energy technologies (e.g., solar, wind, and biomass). In the 

United States, these technologies are too expensive or have environmental or other 

concerns that limit broad application, but that could change with technology development or if the costs of fossil fuels increase. Replacing coal-fired electric power 

plants with more efficient, modern natural-gas-fired turbines would reduce carbon 

emissions per unit of electricity produced. 

Several technologies are being explored that would collect CO2 that would otherwise be emitted to the atmosphere from fossil-fuel-fired power plants, and then sequester it in the ground or the ocean. Successful, cost-effective sequestration technologies would weaken the link between fossil fuels and greenhouse gas emissions. 

The 2003 National Academies’ report, Novel Approaches to Carbon Management: 

Separation, Capture, Sequestration, and Conversion to Useful Products, discusses 

the development of this technology. 

Capturing CO2 emissions from the tailpipes of vehicles is essentially impossible, 

which is one factor that has led to considerable interest in hydrogen as a fuel. As 

with electricity, hydrogen must be manufactured from primary energy sources. Significantly reducing carbon emissions when producing hydrogen from fossil fuels (currently the least expensive method) would require carbon capture and sequestration. 

Substantial technological and economic barriers in all phases of the hydrogen fuel 

cycle must first be addressed through research and development. The 2004 National 

Academies’ report, The Hydrogen Economy: Opportunities, Costs, Barriers and R&D 

Needs, presents a strategy that could lead eventually to production of hydrogen from 

a variety of domestic sources—such as coal (with carbon sequestration), nuclear 

power, wind, or photo-biological processes—and efficient use in fuel cell vehicles. 

21

CONTINUED SCIENTIFIC EFFORTS TO ADDRESS A CHANGING CLIMATE

The task of mitigating and preparing for the impacts of climate change will require worldwide collaborative inputs from a wide range of experts, including natural 

scientists, engineers, social scientists, medical scientists, those in government at all 

levels, business leaders, and economists. Although the scientific understanding of 

climate change has advanced significantly in the last several decades, there are still 

many unanswered questions. Society faces increasing pressure to decide how best 

to respond to climate change and associated global changes, and applied research 

in direct support of decision making is needed.

The CHAIRMAN. We are going to take Sir John Houghton next, 

even though I stated otherwise. Please proceed, sir. 

STATEMENT OF SIR JOHN HOUGHTON, CO-CHAIRMAN,

SCIENTIFIC ASSESSMENT WORKING GROUP, INTERGOVERNMENTAL PANEL ON CLIMATE CHANGE, LONDON, ENGLAND 

Sir HOUGHTON. Thank you very much, indeed. I consider it a 

privilege to be asked to testify to your committee this morning. 

Thank you for inviting me. 

On my last visit to the United States in March I was briefing the 

National Association of Evangelicals, though a different body, and 

was most pleased to find that large and influential body engaging 

with this issue of global climate change, which is the most serious 

environmental issue which is facing the world today. 

Regarding the science of human-induced climate change as currently understood, it is actually summarized succinctly in last 

month’s resolution in the Senate, which states that the major impacts will come through sea level rise and through increases in the 

frequency and the intensity of extreme events, such as droughts 

and floods. Those are the most damaging disasters the world 

knows. 

An example of an extreme for which we can say with some certainty that the growth of greenhouse gases was largely responsible 

is the European heat wave in the summer of 2003 that lead to the 

deaths of over 20,000 people. 

I said more about the science in my written evidence. Here, I 

would like to say a little more about the Intergovernmental Panel 

on Climate Change, which is the source of much of the scientific 

information that we have, and about which a lot of misinformation 

has been propagated. 

I had the privilege of being chairman or co-chairman of the Panel 

of Scientific Assessments from its formation in 1988 to 2002. The 

IPCC’s latest report in 2001, it is in four volumes, each of 1,000 

pages each, contains many thousands of references to the scientific 

literature. And many hundreds of scientists were involved in the 

writing and review processes. 

The report went through two major reviews, first by scientists. 

And any scientist, who wished, could take part. And second, by 

governments. No assessments on any other scientific topic has been 

so thoroughly researched and reviewed. 

IPCC reports are being produced in a very open process under 

the discipline of science, where honesty and balance are hallmarks 

of that discipline. Influence from personal or political agendas were 

ruled out, and I made absolutely sure of that in my role as chairman. We had many days of lively debate, and scientists, of course, 

are their own best critics. 

22

I remember, after a very hectic meeting, at the end of one of our 

reports, two scientists from the aviation industry who were joined 

as lead authors for that report, came to me and expressed their delight with the IPCC experience. They said never had they before 

been involved in a report for which the conclusions were not known 

before it was written. 

Very strong endorsement has been given to the IPCC from the 

world’s scientific community. Last month, in a completely unprecedented action, a statement was issued by the science academies of 

all the G8 countries, together with the academies of Brazil, China, 

and India, endorsing the IPCC’s work and conclusions. With that 

strong statement from the world’s leading scientists, there can be 

no doubt about the reality and seriousness of human-induced climate change. 

One of the main tasks of the IPCC has to be distinguished between what is well known and understood from those areas with 

large uncertainty. In 1992, in the Framework Convention on Climate Change, agreed by all countries, and signed for the United 

States by President George H.W. Bush, it was already stated that 

enough was known for action to be taken. Since then, the science 

has become substantially more certain. IPCC reports have consistently proved to be too conservative. 

Many suggest why do we not just wait and see before taking action. There are strong reasons for urgent action. The first is scientific. Because the oceans take time to warm, there is a lag in the 

response of climate to increasing gases. So far we have only experienced a small part of the climate response to the emissions that 

have already occurred. 

If emissions were halted tomorrow, over the next 30 years or 

more we would experience a growing level of impacts at least two 

or three times those we have seen already. Further emissions just 

added to that commitment. 

The second reason for the urgent action is economic. Energy infrastructure, for instance, in power stations also lasts typically for 

30 to 50 years. 

The third reason is political. Countries like China and India are 

industrializing very rapidly. I heard a senior energy advisor to the 

Chinese government speak recently. He said that China by itself 

would not be making big moves to non-fossil fuel sources. When the 

developing nations of the West take action, they will take action. 

They will follow, not lead. 

To move the world forward, we have to be seen ourselves to be 

moving. I hope, Mr. Chairman, you will allow me just to say a little 

about the need for leadership if I may, in conclusion. 

People often say to me I am wasting my time talking about global warming. The world, they say, will never agree to take the necessary action. I reply I am optimistic for three reasons. First, I 

have experienced the commitment of the world’s scientific community. Second, I believe the necessary technology is available for 

achieving satisfactory solutions. Third, I believe as a Christian that 

God is committed to his creation, and that we have a God-given 

task of being good stewards of creation, a task that we do not have 

to accomplish on our own, because God is there to help us with it. 

23

* Figures 1-6d have been retained in committee files.

1From IPCC 2001 Synthesis Report published by Cambridge University Press 2001. 

2From IPCC 2001 Synthesis Report published by Cambridge University Press 2001.

3Since the IPCC 2001 report there has been a debate in the scientific literature regarding 

the statistical procedures for reconstruction of the proxy part of the record that might affect its 

overall shape especially over the 14th to the 19th centuries (the little ice age period)—see for 

instance von Storch et al. 2004, Science 306 621-2. This ‘hockey-stick’ debate, however, does not 

significantly influence the main IPCC conclusions regarding the temperature of the 20th century. 

And then a final paragraph, if I may. In my work with the IPCC, 

I have been privileged to work with many climate scientists in the 

United States who are world leaders in their field. The United 

States is also a world leader in the technologies required. The overall challenge is to move close to a zero carbon economy within a 

generation. The means to do that are available. The challenge and 

the opportunities to our scientists and our industries are very 

large. But science and technology are only part of what is needed. 

The challenge is global and requires a global solution. 

Mr. Chairman, the moves recently made by the Senate to develop 

a strategy for addressing the issue of human-induced climate 

change are of tremendous importance. Is it too much to hope that 

they are the start of a bid for leadership by the United States in 

the wide world, as all countries, both developed and developing, set 

out to meet this challenge together? The world is watching what 

the United States and, indeed, what this committee will do. Thank 

you very much. 

The CHAIRMAN. Well, thank you very much. 

[The prepared statement of Sir Houghton follows:]

PREPARED STATEMENT OF SIR JOHN HOUGHTON, CO-CHAIRMAN, SCIENTIFIC ASSESSMENT WORKING GROUP, INTERGOVERNMENTAL PANEL ON CLIMATE CHANGE,

LONDON, ENGLAND

I consider it a privilege to be asked to testify to your committee this morning. 

Thank you for inviting me. On my last visit to the United States in March I was 

briefing the National Association of Evangelicals and was most pleased to find that 

large and influential body engaging with this issue of global climate change—the 

most serious environmental issue facing the world today. 

THE BASIC SCIENCE OF GLOBAL WARMING

Let me start with a quick summary of the basic science of Global Warming. By 

absorbing infra-red or ‘heat’ radiation from the earth’s surface, ‘greenhouse gases’ 

present in the atmosphere, such as water vapour and carbon dioxide, act as blankets over the earth’s surface, keeping it warmer than it would otherwise be. The 

existence of this natural ‘greenhouse effect’ has been known for nearly two hundred 

years; it is essential to the provision of our current climate to which ecosystems and 

we humans have adapted. 

Since the beginning of the industrial revolution around 1750, one of these greenhouse gases, carbon dioxide has increased by over 30% and is now at a higher concentration in the atmosphere than it has been for many hundreds of thousands of 

years (Fig 1).* Chemical analysis demonstrates that this increase is due largely to 

the burning of fossil fuels—coal, oil and gas. If no action is taken to curb these emissions, the carbon dioxide concentration will rise during the 21st century to two or 

three times its preindustrial level. 

Fig 1. Concentration of carbon dioxide in the atmosphere from 1000 AD and projected to 2100 under typical IPCC scenarios.1

Fig 2. Variations of the average near surface air temperature: 1000-1861, N Hemisphere from proxy data; 1861-2000, global instrumental; 2000-2100, under a range 

of IPCC projections with further shading to indicate scientific uncertainty.2

The climate record over the last 1000 years (Fig 2) shows a lot of natural variability—including, for instance, the ‘medieval warm period’ and the ‘little ice age’.3

24

4See recent paper by J. Hansen et al. in Sciencexpress for 28 April 2005/10.1126/

science.1110252 5Global climate models run on large computers include all components of the climate system 

(atmosphere, land, oceans, ice and biosphere) with global coverage, include algorithmic descriptions of all physical processes and integrate the dynamical equations to provide simulations of 

current climate or projections of future climate. They are powerful tools that add together the 

effects of all the non linear processes involved. 

The rise in global average temperature (and its rate of rise) during the 20th century 

is well outside the range of known natural variability. The year 1998 is the warmest 

year in the instrumental record. A more striking statistic is that each of the first 

8 months of 1998 was the warmest on record for that month. There is strong evidence that most of the warming over the last 50 years is due to the increase of 

greenhouse gases, especially carbon dioxide. Confirmation of this is also provided by 

observations of the warming of the oceans.4 The period of ‘global dimming’ from 

about 1950 to 1970 is most likely due to the increase in atmospheric particles (especially sulphates) from industrial sources. These particles reflect sunlight, hence 

tending to cool the surface and mask some of the warming effect of greenhouse 

gases. Global climate models5 that include human induced effects (greenhouse gas 

increases and particles) and known natural forcings (e.g. variations in solar radiation and the effects of volcanoes) can provide good simulations of the 20th century 

profile of global average temperature change. 

Over the 21st century the global average temperature is projected to rise by between 2 and 6° C (3.5 to 11° F) from its preindustrial level; the range represents 

different assumptions about emissions of greenhouse gases and the sensitivity of the 

climate model used in making the estimate (Fig 2). For global average temperature, 

a rise of this amount is large. The difference between the middle of an ice age and 

the warm periods in between is only about 5 or 6° C (9 to 11° F). So, associated 

with likely warming in the 21st century will be a rate of change of climate equivalent to say, half an ice age in less than 100 years—a larger rate of change than 

for at least 10,000 years. Adapting to this will be difficult for both humans and 

many ecosystems. 

THE IMPACTS OF HUMAN INDUCED CLIMATE CHANGE

Talking in terms of changes of global average temperature, however, tells us rather little about the impacts of global warming on human communities. Some of the 

most obvious impacts will be due to the rise in sea level that occurs because ocean 

water expands as it is heated. The projected rise is of the order of half a metre (20 

inches) a century and will continue for many centuries—to warm the deep oceans 

as well as the surface waters takes a long time. This will cause large problems for 

human communities living in low lying regions, for instance in the Everglades region of Florida. Many areas, for instance in Bangladesh (where about 10 million live 

within the one metre contour—Fig 3), southern China, islands in the Indian and Pacific oceans and similar places elsewhere in the world, will be impossible to protect 

and many millions will be displaced.

Fig 3. Land affected in Bangladesh by various amounts of sea level rise

There will also be impacts from extreme events. The extremely unusual high temperatures in central Europe during the summer of 2003 led to the deaths of over 

20,000 people. Careful analysis shows that it is very likely that a large part of the 

cause of this event is due to increases in greenhouse gases and projects that such 

summers are likely to be the norm by the middle of the 21st century and cool by 

the year 2100. 

Water is becoming an increasingly important resource. A warmer world will lead 

to more evaporation of water from the surface, more water vapour in the atmosphere and more precipitation on average. Of greater importance is the fact that the 

increased condensation of water vapour in cloud formation leads to increased latent 

heat of condensation being released. Since this latent heat release is the largest 

source of energy driving the atmosphere’s circulation, the hydrological cycle will become more intense. This means a tendency to more intense rainfall events and also 

less rainfall in some semi-arid areas. Since, on average, floods and droughts are the 

most damaging of the world’s disasters (see box), their greater frequency and intensity is bad news for most human communities and especially for those regions such 

as south east Asia and sub-Saharan Africa where such events already occur only 

too frequently. 

25

6Palmer, T.N., and Raisanen, J., 2002, Nature, 415, 512-14. 7Many of the studies addressing the cost of global warming impacts fail to take account of 

the cost of extremes as is explained in Houghton, Global Warming: the Complete Briefing, CUP 

2004, chapter 7. 

MAJOR FLOODS IN THE 1990S

• 1991, 1994-5, 1998—China; average disaster cost 1989-96, 4% of GDP 

• Mississipi & Missouri, U.S.A.; flooded area equal to one of great lakes 

• 1997—Europe; 162,000 evacuated and > 5bn $ loss 

• 1998—Hurricane Mitch in central America; 9000 deaths, economic loss in Honduras & Nicaragua 70% & 45% of GDP 

• 1999—Venezuela; flooding led to landslide, 30,000 deaths 

• 2000-1—Mozambique; two floods leave more than half a million homeless

Regarding extreme events and disasters, it is often pointed out that climate possesses large natural variability and such events have been common occurrences over 

the centuries. It is not possible, for instance, when a disaster occurs to attribute 

that particular event to increasing greenhouse gases (except perhaps for the 2003 

heat wave mentioned above). So, what is the evidence that they will increase in a 

globally warmed world? First, there is our understanding of the basic science of climate change that I have briefly outlined. Secondly, increasing evidence is provided 

from observations. Significant increases have been observed in the number of intense rainfall events especially over areas like the U.S.A. where there is good data 

coverage. Data from insurance companies show an increase in economic losses in 

weather related disasters of a factor of 10 in real terms between the 1950s and the 

1990s. Some of this can be attributed to an increase in vulnerability to such disasters. However, a significant part of the trend has also arisen from increased storminess especially in the 1980s and 1990s. 

Thirdly, increased risk of heat waves, floods and droughts are some of the most 

robust projections of climate models that take into account in a comprehensive way 

all the physical and dynamical processes involved in climate change. For instance, 

a study for the area of central Europe, with doubled atmospheric carbon dioxide concentration (likely to occur during the second half of the 21st century), indicates an 

decrease in the return period of flooding events by about a factor of five (e.g. from 

50 years to 10 years).6

Tropical cyclones are particular damaging storms that occur in the sub tropics. 

They require special mention because no evidence exists for an increase in their 

number as the earth warms although an increase is considered likely in peak wind 

and precipitation intensities in such systems. Sea level rise, changes in water availability and extreme events will cause the most damaging impacts of human induced 

climate change.7 They will lead to increasing pressure from many millions of environmental refugees. 

In addition to the main impacts summarised above are changes about which there 

is less certainty, but if they occurred would be highly damaging and possibly irreversible. For instance, large changes are being observed in polar regions. If the temperature rises more than about 3° C (approximately 5° F) in the area of Greenland, 

it is estimated that melt down of the ice cap would begin. Complete melt down is 

likely to take 1000 years or more but it would add 7 metres (23 feet) to the sea 

level. 

A further concern is regarding the Thermo-Haline Circulation (THC)—a circulation in the deep oceans, partially sourced from water that has moved in the Gulf 

Stream from the tropics to the region between Greenland and Scandinavia. Because 

of evaporation on the way, the water is not only cold but salty, hence of higher density than the surrounding water. It therefore tends to sink and provides the source 

for a slow circulation at low levels that connects all the oceans together. This sinking assists in maintaining the Gulf Stream itself. In a globally warmed world, increased precipitation together with fresh water from melting ice will decrease the 

water’s salinity making it less likely to sink. The circulation will therefore weaken 

and possibly even cut off, leading to large regional changes of climate. All climate 

models indicate the occurrence of this weakening. Evidence from paleoclimate history shows that such cut-off has occurred at times in the past. It is such an event 

that is behind the highly speculative happenings in the film, The day after tomorrow.

I have spoken so far about adverse impacts. However, there are some positive impacts. For instance, in Siberia and other areas at high northern latitudes, winters 

will be less cold and growing seasons will be longer. Also, increased concentrations 

of carbon dioxide have a fertilising effect on some plants and crops which, providing 

26

8 Climate Change 2001 in four volumes, published for the IPCC by Cambridge University 

Press, 2001. Also available on the IPCC web site www.ipcc.ch. My book, John Houghton, Global 

Warming: the complete briefing, 3‘d edition, Cambridge University Press, 2004 is strongly based 

on the IPCC reports. Further a review I have recently written (John Houghton, Global Warming, Reports Progress in Physics, 68 (2005) 1343-1403) provides a concise summary of the 

science and associated impacts. 9http://books.nap.edu/html/climatechange/

10http://nationalacademies.org/morenews/

there are adequate supplies of water and nutrients, will lead to increased crop 

yields in some places, probably most notably in northern mid latitudes. However, 

careful studies demonstrate that adverse impacts will far outweigh positive effects, 

the more so as temperatures rise more than 1 or 2° C (2 to 3.5° F) above 

preindustrial. 

Many people ask how sure we are about the scientific story I have just presented. 

Let me explain that it is based very largely on the extremely thorough work of the 

Intergovernmental Panel on Climate Change (IPCC) and its last major report published in 2001. The scientific literature on climate change has increased enormously 

over the last decade. The basic science of anthropogenic climate change has been 

confirmed. The main uncertainties lie in our knowledge of feedbacks in the climate 

system especially those associated with the effects of clouds. Recent research has 

tended to indicate increased likelihood of the more damaging impacts. 

THE INTERGOVERNMENTAL PANEL ON CLIMATE CHANGE (IPCC)

Let me explain more about the work of the IPCC. It was formed in 1988 jointly 

by the World Meteorological Organisation and the United Nations Environment Programme. I had the privilege of being chairman or co-chairman of the Panel’s scientific assessment from 1988 to 2002. Hundreds of scientists drawn from many 

countries were involved as contributors and reviewers in these assessments. The 

IPCC has produced three assessments—in 1990, 1995 and 2001—covering science, 

impacts and analyses of policy options. The IPCC 2001 report is in four volumes 

each of about 1000 pages and containing many thousands of references to the scientific literature.8 Each chapter of the Report went through two major reviews, first 

by hundreds of scientists in the scientific community (any scientist who wished 

could take part in this) and secondly, by governments. No assessment on any other 

scientific topic has been so thoroughly researched and reviewed. 

Because the IPCC is an intergovernmental body, the reports’ Summaries for Policymakers were agreed sentence by sentence by meetings in which governmental 

delegates from about 100 countries (including all the world’s major countries) work 

with around 40 leading scientists representing the scientific community. It is sometimes supposed that the presence of governments implies political interference with 

the process. That has not been the case. In any event, governments taking part 

come from the complete spectrum of political agendas. These are scientific meetings 

in which all proposals for changes in the text must be based either on scientific arguments or on a desire for clearer presentation. In every case, the process has resulted in documents with overall improved scientific clarity and balance. 

The work of the IPCC is backed by the worldwide scientific community. A joint 

statement of support was issued in May 2001 by the national science academies of 

Australia, Belgium, Brazil, Canada, the Caribbean, China, France, Germany, India, 

Indonesia, Ireland, Italy, Malaysia, New Zealand, Sweden and the U.K. It stated 

‘We recognize the IPCC as the world’s most reliable source of information on climate 

change and its causes, and we endorse its method of achieving consensus.’ In 2001, 

a report of the United States National Academy of Sciences commissioned by the 

President George W. Bush administration, supported the IPCC’s conclusions.9 A 

joint statement issued in June 2005 by the science academies of all the G8 countries 

together with the academies of Brazil, China and India also endorsed the work and 

conclusions of the IPCC.10

Let me comment further on the issues of uncertainty and balance as expressed 

in the work of the IPCC. There are very large amounts of data available to the scientist looking for evidence of climate change. Examples abound of those who approach the data with preconceived agendas and who have selected data to fit those 

agendas—for instance purporting to prove either that there is little or no evidence 

for human induced change or that the world is heading for a future that could mean 

the end of the human race. The task of the IPCC has been to review all the evidence 

in a balanced manner and honestly and objectively to distinguish what is reasonably 

well known and understood from those areas with large uncertainty. The reports 

have differentiated between degrees of uncertainty, where possible providing numerical estimates of uncertainty. A large part of the IPCC process, taking many days 

27

11From Energy for Tomorrow’s World: the realities, the real options and the agenda for 

achievement. World Energy Council Report 1993. 12 After M. Grubb 2003, World Economics 3, p. 145.

of scientists’ time, has been taken up with discussion and correspondence about how 

best to present uncertainty. 

Let me mention a further point on the uncertainty issue. In the IPCC reports, because they are scientific documents, uncertainty tends to be mentioned frequently 

giving the impression to the casual reader that the uncertainty in the conclusions 

is larger than it is in many other areas of our experience with which comparison 

could be made. What is important to realise is that there is a high degree of certainty that significant human induced climate change is occurring and will continue 

to occur. A forecast of little or no such climate change is almost certainly wrong. 

THE FRAMEWORK CONVENTION ON CLIMATE CHANGE

Because of the work of the IPCC and its first report in 1990, the Earth Summit 

at Rio de Janeiro in 1992 could address the climate change issue and the action that 

needed to be taken. The Framework Convention on Climate Change (FCCC)—

agreed by over 160 countries, signed by President George Bush Sr. for the U.S.A. 

and subsequently ratified unanimously by the U.S. Senate—agreed that Parties to 

the Convention should take ‘‘precautionary measures to anticipate, prevent or 

minimise the causes of climate change and mitigate its adverse effects. Where there 

are threats of irreversible damage, lack of full scientific certainty should not be used 

as a reason for postponing such measures.’’

More particularly the Objective of the FCCC in its Article 2 is ‘‘to stabilise greenhouse gas concentrations in the atmosphere at a level that does not cause dangerous 

interference with the climate system’’ and that is consistent with sustainable development. Such stabilisation would also eventually stop further climate change. However, because of the long time that carbon dioxide resides in the atmosphere, the 

lag in the response of the climate to changes in greenhouse gases (largely because 

of the time taken for the ocean to warm), and the time taken for appropriate human 

action to be agreed, the achievement of such stabilisation will take at least the best 

part of a century. 

STABILIZATION OF CARBON DIOXIDE

Global emissions of carbon dioxide to the atmosphere from fossil fuel burning are 

currently approaching 7 billion tonnes of carbon per annum and rising rapidly (Fig 

4). Unless strong measures are taken they will reach two or three times their 

present levels during the 21st century and stabilisation of greenhouse gas concentrations or of climate will be nowhere in sight. To stabilise carbon dioxide concentrations in accordance with the FCCC Objective, emissions during the 21st century must reduce to a fraction of their present levels before the century’s end. 

The reductions in emissions must be made globally; all nations must take part. 

However, there are very large differences between greenhouse gas emissions in different countries. Expressed in tonnes of carbon per capita per annum, they vary 

from about 5.5 for the U.S.A., 2.2 for Europe, 0.7 for China and 0.2 for India (Fig 

5). Ways need to be found to achieve reductions that are both realistic and equitable.

Fig 4. Global emissions of carbon dioxide from fossil fuel burning (in billions of 

tonnes of carbon) up to 1990 and as projected to 2100 under World Energy Council 

scenarios,11 A’s and B’s with various ‘business as usual assumptions’ and C for ‘ecologically driven scenario’ that would lead to stabilisation of carbon dioxide concentration at about 450 ppm. 

Fig 5. Carbon dioxide emissions in 2000 per capita for different countries and 

groups of countries.12

The Kyoto Protocol set up by the FCCC represents a beginning for the process 

of reduction, averaging about 5% below 1990 levels by 2012 by those developed 

countries who have ratified the protocol. It is an important start demonstrating the 

achievement of a useful measure of international agreement on such a complex 

issue. It also introduces for the first time international trading of greenhouse gas 

emissions so that reductions can be achieved in the most cost effective ways. 

Serious discussion is now beginning about international agreements for emissions 

reductions post Kyoto. These must include all major emitters in both developed and 

developing countries. On what eventual level of stabilisation, of carbon dioxide for 

instance, should these negotiations focus? To stop damaging climate change the 

level needs to be as low as possible. In the light of the FCCC Objective it must also 

28

13From World Energy Outlook, LEA 2004.

allow for sustainable development. Let me give two examples of stabilisation proposals. In 1996 the European Commission proposed a limit for the rise in global average temperature from its preindustrial value of 2° C—that implies a stabilisation 

level for carbon dioxide of about 430 ppm (allowing for the effect of other greenhouse 

gases at their 1990 levels). The second example comes from Lord John Browne, 

Chief Executive Officer of British Petroleum, one of the world’s largest oil companies, who in a recent speech proposed ‘stabilisation in the range 500-550 ppm’ that 

‘with care could be achieved without disrupting economic growth.’

Let us consider carbon dioxide stabilisation at 500 ppm. If the effect of other 

greenhouse gases at their 1990 levels is added, it is about equivalent to doubled carbon dioxide at its preindustrial level and a rise in global averaged temperature of 

about 2.5° C. Although climate change would eventually largely be halted—although 

not for well over a hundred years—the climate change impacts at such a level would 

be large. A steady rise in sea level will continue for many centuries, heat waves 

such as in Europe in 2003 would be commonplace, devastating floods and droughts 

would be much more common in many places and Greenland would most likely start 

to melt down. The aim should be therefore to stabilise at a lower level. But is that 

possible? 

The International Energy Agency (TEA) in 2004 published a World Energy Outlook that in their words ‘paints a sobering picture of how the global energy system 

is likely to evolve from now to 2030’. With present governments’ policies, the world’s 

energy needs will be almost 60% higher in 2030 that they are now. Fossil fuels will 

dominate, meeting most of the increase in overall energy use. Energy-related emissions of carbon dioxide will grow marginally faster than energy use and will be more 

than 60% higher in 2030 than now (Fig 6, reference scenario). Over two-thirds of 

the projected increase in emissions will come from developing countries.

Fig 6. Carbon dioxide emissions from fossil fuel burning and profile leading to 

stabilisation at 500 ppm (a, b and c) and 450 ppm (d). Emissions data from International Energy Agency scenarios;13 reference (a), alternative (b) for developed countries (red) and developing (blue). For (c) and (d) see text. 

The Outlook also presents an Alternative Scenario that analyses the global impact 

of environmental and energy-security policies that countries around the world are 

already considering as well as the effects of faster deployment of energy-efficient 

technologies. However, even in this scenario, global emissions in 2030 are substantially greater than they are today (Fig 6). Neither scenario comes close to creating 

the turn around in the global profile required. 

The U.K. government has taken a lead on this issue and has agreed a target for 

the reduction of greenhouse gas emissions of 60% by 2050—predicated on a 

stabilisation target of doubled carbon dioxide concentrations together with a recognition that developed countries will need to make greater reductions to allow some 

headroom for developing countries. Economists in the U.K. government Treasury 

Department have estimated the cost to the U.K. economy of achieving this target. 

On the assumption of an average growth in the U.K. economy of 2.25% p.a., they 

estimated a cost of no more than the equivalent of 6 months’ growth over the 50 

year period. Similar costs for achieving stabilisation have been estimated by the 

IPCC. 

The effect of a reduction of 60% on average by developed countries is shown in 

Fig 6(c) together with a scenario for developing countries that increases by 1% p.a. 

until 2030 followed by level emissions to 2050. For this the 500 ppm curve is approximately followed but for developing countries to be satisfied with such a modest 

growth presents a very large challenge. Even more challenging for both developed 

and developing countries would be the measures required to stabilise at 450 ppm 

(Fig 6(d)). Governor Schwarzenegger of California has begun to address this challenge by proposing an even more demanding reduction target of 80% by 2050. 

CAN WE WAIT AND SEE?

In order to achieve reductions on the scale that is required to stabilize carbon dioxide concentrations, large changes will have to occur in way we use energy 

(through energy efficiency improvements) and generate it (through moves to energy 

sources with zero or low carbon emissions). But how urgent are the changes required. It is sometimes suggested that we can ‘wait and see’ before serious action 

is needed. This is an area where policy needs to be informed by the perspective from 

science. 

29

14See recent paper by J. Hansen et al. in Sciencexpress for 28 April 2005/10.1126/

science.1110252 15http://nationalacademies.org/morenews/ 16http://www.g8.gov.uk 17 Address to the Energy and Environment Ministerial Roundtable, 15 March 2005; http://

www.hm-treasury.gov.uk/newsroomlandlspeeches/press/2005/pressl29l05.cfm

There is a strong scientific reason for urgent action. Because the oceans take time 

to warm, there is a lag in the response of climate to increasing greenhouse gases. 

So far we have only experienced a small part of the climate response to the greenhouse gas emissions that have already occurred. If greenhouse gas emissions were 

halted tomorrow, climate impacts much greater than we have so far experienced but 

to which we are already committed will be realized over the next 30 years and more 

into the future.14 Further emissions from now on just add to that commitment. It 

is for this reason that the June 2005 statement from the world’s major science academies urges all nations,15 ‘to take prompt action to reduce the causes of climate 

change and adapt to its impacts’ and to ‘identify cost-effective steps that can be taken 

now to contribute to substantial and long-term reduction in net global greenhouse 

gas emissions, recognizing that delayed action will increase the risk of adverse environmental effects and will likely incur a greater cost.’

Two further reasons can be identified for urgent action. One is economic. Energy 

infrastructure, for instance in power stations also lasts typically for 30 to 50 years. 

As was stated by the leaders of the G8 countries meeting at Gleneagles in the U.K. 

earlier this month,16 We face a moment of opportunity. Over the next 25 years, an 

estimated $16 trillion will need to be invested in the world’s energy systems. According to the IEA, there are significant opportunities to invest this capital cost-effectively 

in cleaner energy technologies and energy efficiency. Because decisions being taken 

today could lock in investment and increase emissions for decades to come, it is important to act wisely now.

A third reason is political. Countries like China and India are industrialising very 

rapidly. I heard a senior energy adviser to the Chinese government speak recently. 

He said that China by itself would not be making big moves to non fossil fuel 

sources. When the developed nations of the west take action, they will take action—

they will follow not lead. China is building new electricity generating capacity of 

about 1 GW power station per week. To move the world forward we have to be seen 

ourselves to be moving. 

THE U.K. AND CLIMATE CHANGE

I would like to add a few remarks about the U.K. and climate change. It was 

Prime Minister Margaret Thatcher who in 1988, speaking as a scientist as well as 

a political leader, was one of the first to bring the potential threat of global warming 

to world attention. Subsequent U.K. governments have continued to play a leading 

international role in this issue. This year, Prime Minister Tony Blair has put climate change at the top of his agenda for his presidency of the G8 and the EU. 

This international activity has brought the realisation within the U.K. government that a big environmental issue such as climate change needs to be brought 

much closer to the centre of the government machine. For instance, Gordon Brown, 

U.K.’s Chancellor of the Exchequer has clearly stated the importance of addressing 

the economy and environment together. In a recent speech he said,17 ‘Environmental issues—including climate change—have traditionally been placed in a category separate from the economy and from economic policy. But this is no longer 

tenable. Across a range of environmental issues—from soil erosion to the depletion 

of marine stocks, from water scarcity to air pollution—it is clear now not just that 

economic activity is their cause, but that these problems in themselves threaten future economic activity and growth.’

THE NEED FOR LEADERSHIP

We, in the developed countries have already benefited over many generations 

from abundant and cheap fossil fuel energy—although without realising the potential damage to the climate and especially the disproportionate adverse impacts falling on the poorer nations. The Framework Convention on Climate Change (FCCC) 

recognized the particular responsibilities this placed on developed countries to be 

the first to take action and to provide assistance (e.g. through appropriate finance 

and technology transfer) to developing countries for them to cope with the impacts 

and to develop cost effective sources of energy free of carbon emissions. The moral 

imperative created by these responsibilities is reflected in the statement on climate 

change made by the leaders of the G8 countries meeting at Gleneagles in the folVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00033 Fmt 6633 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
30

18http://www.g8.gov.uk 19From Earth’s Climate Embraces Us All: A Plea From Religion and Science for Action on 

Global Climate Change, July 2004; available form the National Religious partnership for the Environment at http://www.nrpe.org/climatelletter.pdf

lowing paragraph,18 ‘It is in our global interests to work together, and in partnership 

with major emerging economies, to find ways to achieve substantial reductions in 

greenhouse gas emissions and our other key objectives, including the promotion of 

low-emitting energy systems. The world’s developed economies have a responsibility 

to act.’

People often say to me that I am wasting my time talking about Global Warming. 

‘The world’ they say ‘will never agree to take the necessary action’. I reply that I 

am optimistic for three reasons. First, I have experienced the commitment of the 

world scientific community (including scientists from many different nations, backgrounds and cultures) in painstakingly and honestly working together to understand 

the problems and assessing what needs to be done. Secondly, I believe the necessary 

technology is available for achieving satisfactory solutions. My third reason is that, 

as a Christian, I believe God is committed to his creation and that we have a Godgiven task of being good stewards of creation—a task that we do not have to accomplish on our own because God is there to help us with it. As a recent statement 

on climate change by scientific and religious leaders in the U.S. says:19 ‘What is 

most required at this moment . . . is moral vision and leadership. Resources of 

human character and spirit—love of life, far-sightedness, solidarity—are needed to 

awaken a sufficient sense of urgency and resolve.’

In my work with the IPCC I have been privileged to work with many climate scientists from the U.S.A. who are world leaders in their field. The U.S.A. is also a 

world leader in the technologies aimed at reducing greenhouse gas emissions. But 

science and technology are only part of what is required. Mr. Chairman, the moves 

recently made by the Senate to develop a strategy for addressing the issue of human 

induced climate change are of great importance. Is it too much to hope that they 

are the start of a bid for leadership by the U.S. in the wider world as all countries—

both developed and developing—set out to meet this challenge together?

The CHAIRMAN. Now we will proceed in the order that we started. 

Dr. Molina. 

STATEMENT OF DR. MARIO MOLINA, PROFESSOR,

UNIVERSITY OF CALIFORNIA, SAN DIEGO 

Dr. MOLINA. I am very pleased to be here to discuss the science 

of climate change and to reflect on the very real challenge of making sound policy choices in the face of uncertainty. Climate change 

is, perhaps, the most worrisome global environmental problem confronting human society today. It involves a complex interplay of 

scientific, economic, and political issues. The impacts of climate 

change are potentially very large, and will occur over a time scale 

of decades to centuries. 

The actions needed to respond to this challenge require substantial long-term commitments to change traditional economic development paths throughout the world. The ultimate solution to the 

challenge will require a fundamental transformation in the production and consumption of energy in the United States, but also by 

developed and developing nations. 

I want to address the bulk of my remarks to the threshold question. Do we know enough about climate change to act now and to 

start doing something serious to address this problem? Let me first 

comment on what I think the role of scientists should be in answering this question. 

Ultimately, policy decisions about climate change have to be 

made by society at large, and more specifically by policymakers like 

yourselves. Scientists do not have any special privilege to make 

31

such decisions, but science does play a fundamental role on this 

issue. 

The climate system is very complicated, and science does not 

have all the answers. There are uncertainties in predicting when 

and to what extent will the climate change as a consequence of a 

given course of human activities. However, scientists can estimate 

the probability that the earth’s climate will respond in certain 

ways. 

For simplicity, the climate response is often represented as the 

increasing average global surface temperature of the planet, say, by 

the end of the century. This information can be used by policymakers to assess the risks imposed by climate change and to devise 

adequate responses to address the challenge. 

Let me simply summarize what we know about climate change, 

although we just heard the other witnesses, Dr. Cicerone and Sir 

John Houghton already summarizing these. But I firmly embrace 

the view expressed in the recent sense of the Senate resolution, 

namely that there is a growing scientific consensus that human activity is a substantial cause of greenhouse gas accumulation in the 

atmosphere, ‘‘and that these accumulating gases are causing average temperatures to rise at the rate outside of natural variability.’’

Simply stated, the world is warming. It is due to our emissions. 

More warming is inevitable, but the amount of future warming is 

in our hands. Because carbon dioxide accumulates and remains in 

the atmosphere, each generation inherits the emissions of all those 

who have gone before. Many future generations of human beings 

will wrestle with this issue. 

Modest amounts of warming will have both positive and negative 

impacts. But above a certain threshold, the impacts turn strongly 

negative for most nations, people, and for biological systems. 

While there is a growing scientific consensus around the science 

of climate change, there is, of course, much that we do not fully understand about the timing, geographic distribution, and the severity of the changes in climate, and the economic, environmental and 

social impacts of these changes that will result if greenhouse gases 

continue to increase. However, not knowing with certainty how the 

climate system would respond should not be an excuse for inaction. 

Policymakers frequently, in the position of making decisions, 

they do that in the face of uncertainties. Usually, the presence of 

uncertainty means that we build extra insurance to protect against 

the risk that the consequences may be worse than expected. It 

would be better, of course, if we knew exactly where the perfect 

balance between costs, risks and benefits lies, but the fact is that 

we never have that luxury. 

Nevertheless, policymakers and the individuals both must manage public and personal risks all the time. And we do. Most people 

buy car insurance even though they do not know with any degree 

of certainty what their individual risk of being in a car accident 

might be, just as most doctors would advise an individual with a 

history of heart trouble to choose low-fat foods and exercise despite 

the many complex and usually unknowable factors that go into determining any individual person’s risk of having a heart attack. 

If we apply the same logic in setting goals for limiting the risks 

associated with future climate change, it becomes very clear that 

32

our current course now places us far outside the kinds of risk 

thresholds we typically apply in other areas of public policy. 

Put another way, there is now an overwhelming consensus that 

failure to limit greenhouse gas emissions would produce a risk of 

significant adverse consequences that is far higher than we find acceptable in other arenas. When facing a substantial chance of potentially catastrophic consequences and the near certainty of lesser 

negative effects, the only prudent course of action is to mitigate 

these risks. 

And let us be clear, when we speak of potentially catastrophic 

consequences in this context, we are talking about the devastating 

impacts on ecosystems and biodiversity, severe flood damage to 

urban centers and island nations as sea level rises, significantly 

more destructive and frequent extreme weather events, such as 

droughts and floods, seriously affected agricultural productivity in 

many countries, exacerbation of certain diseases, population dislocations and so, on and on. 

A reasonable target, in my view, is to attempt to limit the global 

temperature increase to less than, say, four degrees Fahrenheit. 

Recent estimates indicate that stabilizing the amount of greenhouse gases in the atmosphere at the equivalent of twice the preindustrial value of 280 parts per million of carbon dioxide, this provides only a 10 to 20 percent chance of limiting global average temperature rise to four degrees Fahrenheit. 

Put another way, this means that the odds that average global 

temperature will rise above four degrees is 80 to 90 percent. Unless 

society starts taking some aggressive actions now, we are well on 

our way to reaching perhaps even a tripling of pre-industrial carbon dioxide levels with far greater adverse economic and environmental consequences. 

The CHAIRMAN. Doctor, I hate to tell you this, but you better——

Dr. MOLINA. Okay. 

The CHAIRMAN. Maybe two more minutes. 

Dr. MOLINA. Two more—I will. I applaud the committee for its 

commitment to explore proposals consistent with the sense of the 

Senate resolution. And moreover, I commend you for beginning this 

exploration with a discussion of climate change. As you know, I am 

one of sixteen members of the National Commission on Energy Policy, and you will hear more about the Commission from Jason 

Grumet, our executive director. But one of my main contributions 

to the Commission’s deliberations was helping the group understand the challenge of forging sound climate change in the face of 

evolving scientific knowledge. 

This national commission agreed on some statements, which I 

will end my testimony just summarizing this consensus from this 

group, which you will hear more about. I quote, ‘‘We understand 

that the scientific consensus has emerged that global temperatures 

have been increasing at the rate that is outside the range of natural variability. Continuation of the greenhouse gas emission 

trends along business-as-usual lines could produce changes in climatic patterns in this century that will produce significant adverse 

impacts on human societies.’’

The second point. ‘‘There are many uncertainties in the details 

of the timing and severity of the changes in climates; economic, enVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00036 Fmt 6633 Sfmt 6602 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
33

vironmental, and social impacts of these changes as well that will 

result if business as usual prevails. There are also uncertainties 

about the availability and costs of energy supply and energy-induced technologies that might be brought to bear to achieve much 

lower greenhouse emissions than those expected with business as 

usual.’’ 

‘‘But these uncertainties for further research and development to 

try to reduce them, they are not proper cause for taking no other 

action to reduce the risks from human-caused climate change. 

What is already known about this risk is sufficient reason to accelerate, starting now, the search for a mix of affordable technical and 

policy measures that will be able to reduce greenhouse emissions 

substantially, furthermore to adapt to the degree of climate change 

that cannot be avoided without incurring unreasonable costs. This 

is not only a major challenge in fashioning a sensible energy policy 

for the United States, but it is a challenge that no sensible energy 

policy can ignore.’’ 

I thank you for your attention and look forward to working with 

the committee in the weeks and months ahead. 

The CHAIRMAN. Thank you very much. 

[The prepared statement of Dr. Molina follows:]

PREPARED STATEMENT OF PROFESSOR MARIO MOLINA, UNIVERSITY OF CALIFORNIA, SAN DIEGO

Good Morning. I am very pleased to be here to discuss the science of climate 

change and to reflect on the very real challenge of making sound policy choices in 

the face of uncertainty. Climate change is perhaps the most worrisome global environmental problem confronting human society today. It involves a complex interplay 

of scientific, economic, and political issues. The impacts of climate change are potentially very large and will occur over a time scale of decades to centuries. The actions 

needed to respond to this challenge require substantial long-term commitments to 

change traditional economic development paths throughout the world. The ultimate 

solution to the challenge will require a fundamental transformation in the production and consumption of energy here in the United States and by developed and developing nations alike. 

I want to address the bulk of my remarks to the threshold question: Do we know 

enough about climate change to act now and to start doing something serious to address this problem? Let me first comment on what I think the role of scientists 

should be in answering this question. Ultimately policy decisions about climate 

change have to be made by society at large, and more specifically by policymakers. 

Scientists do not have any special privilege to make such decisions, but science does 

play a fundamental role on this issue. The climate system is very complicated and 

science does not have all the answers: there are uncertainties in predicting when 

and to what extent will the climate change as a consequence of a given course of 

human activities. However, scientists can estimate the probability that the earth’s 

climate will respond in certain ways. For simplicity the climate response is often 

represented as the increase in average global surface temperature of the planet say, 

by the end of the century. This information can be used by policymakers to assess 

the risks imposed by climate change and to device adequate responses to address 

the challenge. 

Let me begin by simply summarizing what we know about climate change. I firmly embrace the view expressed in the recent Sense of the Senate Resolution that 

‘‘there is a growing scientific consensus that human activity is a substantial cause 

of greenhouse gas accumulation in the atmosphere, and that these accumulating 

gasses are causing average temperatures to rise at a rate outside of natural variability.’’

Simply stated, the world is warming.

• It is due to our emissions. • More warming is inevitable—but the amount of future warming is in our hands. • Because CO2 accumulates and remains in the atmosphere, each generation inherits the emissions of all those who have gone before. Many future generations 

of human beings will wrestle with this issue. 

34

• Modest amounts of warming will have both positive and negative impacts. But 

above a certain threshold, the impacts turn strongly negative for most nations, 

people, and biological systems.

While there is a growing scientific consensus around the science of climate 

change, there is of course much that we do not fully understand about the timing, 

geographic distribution, and severity of the changes in climate—and the economic, 

environmental, and social impacts of these changes—that will result if heat-forcing 

emissions continue to increase. However, not knowing with certainty how the climate system will respond should not be an excuse for inaction. Policymakers are 

frequently, indeed usually, in the position of making decisions in the face of uncertainties. Usually, the presence of uncertainty means that we build in extra insurance to protect against the risk that consequences may be worse than we expect. 

It would be better, of course, if we knew exactly where the perfect balance between 

cost, risk, and benefit lies. But the fact is that we never have that luxury. Nevertheless, policy makers and individuals both must manage public and personal risks all 

the time and we do. Most people buy car insurance even though they don’t know 

with any degree of certainty what their individual risk of being in a car accident 

might be, just as most doctors would advise an individual with a history of heart 

trouble to choose low-fat foods and exercise despite the many complex and usually 

unknowable factors that go into determining any individual person’s risk of having 

a heart attack. 

If we apply the same logic in setting goals for limiting the risks associated with 

future climate change, it becomes very clear that our current course now places us 

far outside the kinds of risk thresholds we typically apply in other areas of public 

policy. Put another way, there is now an overwhelming consensus that failure to 

limit greenhouse gas emissions will produce a risk of significant adverse consequences that is far higher than we find acceptable in other arenas. When facing 

a substantial chance of potentially catastrophic consequences and the near certainty 

of lesser negative effects, the only prudent course of action is to mitigate these risks. 

And let us be clear—when we speak of potentially catastrophic consequences in this 

context we are talking about devastating impacts on ecosystems and biodiversity; 

severe flood damage to urban centers and island nations as sea level rises; significantly more destructive and frequent extreme weather events such as droughts and 

floods; seriously affected agricultural productivity in many countries; the exacerbation of certain diseases; population dislocations; etc. 

A reasonable target, in my view, is to attempt to limit the global temperature increase to less than about 4 degrees Fahrenheit. Recent estimates indicate that stabilizing the amount of greenhouse gases in the atmosphere at the equivalent of twice 

the pre-industrial value of 280 ppm carbon dioxide provides only a 10-20 per cent 

chance of limiting global average temperature rise to 4 degrees Fahrenheit. Put another way, this means that the odds that average global temperatures will rise 

above 4 degrees is 80 to 90 percent. Unless society starts taking some aggressive 

actions now, we are well on our way to reaching perhaps even a tripling of pre-industrial carbon dioxide levels with far greater adverse economic and environmental 

consequences. 

The risks to human society and ecosystems grow significantly if the average global surface temperature increases 5 degrees Fahrenheit or more. Such a large temperature increase might entail, for example, substantial agricultural losses, widespread adverse health impacts and greatly increased risks of water shortages. Furthermore, a very high proportion of the world’s coral reefs would be imperiled and 

many terrestrial ecosystems could suffer irreversible damage. The risk of runaway 

or abrupt climate change also increases rapidly if the average temperature increases 

above about 5 degrees Fahrenheit. It is possible, for example, that the West Antarctic and Greenland ice sheets will melt, raising sea levels more than ten meters 

over the period of a few centuries. It is also possible that the ocean circulation will 

change abruptly, perhaps shutting down the Gulf Stream. 

I applaud the Committee for its commitment to explore legislative proposals consistent with the Sense of the Senate Resolution and moreover commend you for beginning this exploration with a discussion of climate science. As you may know, I 

am one of sixteen members of the National Commission for Energy Policy (NCEP). 

You will hear more about the Commission from Jason Grumet, our Executive Director, shortly. One of my main contributions to the Commission’s deliberations was 

helping the group understand the challenge of forging sound climate policy in the 

face of evolving scientific knowledge. Early on in our deliberations we agreed upon 

the following brief statement to guide our policy exploration. I offer it here for the 

Committee’s deliberations:

35

‘‘(1) We understand that a scientific consensus has emerged that (a) global 

temperatures have been increasing at a rate that is outside the range of natural 

variability, (b) human emissions of CO2 and other greenhouse gases have been 

responsible for a part of this increase, and (c) continuation of these emission 

trends along ‘‘business as usual’’ lines could produce changes in climatic patterns in this century that will produce significant adverse impacts on human 

societies. 

(2) There are many uncertainties in the details of the timing, geographic distribution, and severity of the changes in climate—and the economic, environmental, and social impacts of these changes—that will result if ‘‘business as 

usual’’ prevails. There are, likewise, significant uncertainties about the availability and costs of energy-supply and energy-end-use technologies that might 

be brought to bear to achieve much lower greenhouse-gas emissions than those 

expected on the ‘‘business as usual’’ trajectory. 

(3) These uncertainties are cause for further research and development to try 

to reduce them, but they are not proper cause for taking no other action to reduce the risks from human-caused climate change. What is already known 

about these risks is sufficient reason to accelerate, starting now, the search for 

a mix of affordable technical and policy measures that will be able (a) to reduce 

greenhouse-gas emissions substantially from the ‘‘business as usual’’ trajectory 

in the aggregate over a relevant time frame, and (b) to adapt to the degree of 

climate change that cannot be avoided without incurring unreasonable costs. 

This is not the only major challenge in fashioning a sensible energy policy for 

the United States, but it is a challenge that no sensible energy policy can ignore.’’

I thank you for your attention and look forward to working with the Committee 

in the weeks and months ahead.

The CHAIRMAN. You may proceed, Doctor. 

STATEMENT OF JAMES W. HURRELL, PH.D., DIRECTOR,

CLIMATE AND GLOBAL DYNAMICS DIVISION, NATIONAL 

CENTER FOR ATMOSPHERIC RESEARCH, BOULDER, CO 

Dr. HURRELL. I thank Chairman Domenici, Ranking Member 

Bingaman, and the other members of the committee for the opportunity to speak with you today on the science of global climate 

change. It is a privilege to be here. My name is Jim Hurrell, and 

I am director of the Climate and Global Dynamics Division at the 

National Center for Atmospheric Research in Boulder, Colorado. 

There will always be uncertainty in understanding the causes 

and the processes of climate variability and climate change, simply 

because the climate system is an extremely complex, non-linear 

system. However, significant advances in the scientific understanding of climate change now make it clear that there has been 

a change in climate that goes beyond the range of natural variability. 

The globe is warming at a dramatic rate, and any claims to the 

contrary are not credible. Global surface temperatures today are 

more than one degree Fahrenheit warmer than at the beginning of 

the 20th century. And the rates of temperature rise are greatest in 

recent decades. 

Nine of the last 10 years are among the warmest 10 years in the 

instrumental record, which dates back to about 1860. Based on reconstructions of temperature from proxy data like tree rings and 

ice cores, several studies have concluded that northern hemisphere 

surface temperatures are warmer now than at any other time in 

at least the last 1,000 years. 

The surface warming is consistent with a body of other observations that gives a consistent picture of a warming world. For example, there has been a widespread reduction in the number of frost 

36

days in middle latitude regions. And there has been an increase in 

the number of warm extremes. Ocean temperatures have warmed, 

and global sea levels have risen 15 to 20 centimeters over the 20th 

century, as a result. Snow cover has decreased in many regions and 

sea-ice extents have decreased in the Arctic. There has been a 

nearly worldwide reduction in mountain glacier mass and extent. 

Because today’s best climate models are now able to reproduce 

the climate of the past century, they are very useful tools for understanding and determining the changes in forcing that have driven this observed warming. Forcings imposed on the climate system 

can be natural in origin, such as changes in solar luminosity or volcanic eruptions, or they can be human induced, such as the buildup 

of greenhouse gas concentrations in the atmosphere. 

Greenhouse gas concentrations in the atmosphere are now higher 

than at any time in at least the last 750,000 years. In the absence 

of controls, future projections are that the rate of increase in carbon dioxide may accelerate and concentrations could double from 

pre-industrial values within the next 50 to 100 years. 

Climate model simulations that account for such changes in climate forcings have now reliably shown that global surface warming 

of recent decades is a response to the increased concentrations of 

greenhouse gases. Moreover, this attribution of the recent climate 

change has direct implications for the future. Because of the very 

long lifetime of carbon dioxide in the atmosphere, there is a substantial future commitment to further global change, even in the 

absence of further increases and emissions. 

In summary, the scientific understanding of climate change is 

now sufficiently clear to show that climate change from global 

warming is already upon us. Uncertainties remain, especially regarding how climate will change at regional and local scales. But 

the climate is changing, and the rate of change, as projected, exceeds anything seen in nature in the past 10,000 years. 

Mitigation actions taken now to decrease concentrations of greenhouse gases in the atmosphere mainly have benefits 50 years from 

now and beyond. There is no quick fix. While some changes might 

be benign or even beneficial in some geographical areas, global 

warming will be disruptive in many ways. 

Hence, it is vital to plan to cope with the changes, such as enhanced drought, heat waves, wildland fires, and flooding. The 

science of global climate change is certainly sophisticated enough 

at this point to help policymakers make real decisions now that 

will benefit the planet in the future. 

Again, I sincerely thank you for the opportunity to address this 

committee. 

The CHAIRMAN. Thank you very much. 

[The prepared statement of Dr. Hurrell follows:]

PREPARED STATEMENT OF JAMES W. HURRELL, PH.D., DIRECTOR, CLIMATE AND

GLOBAL DYNAMICS DIVISION NATIONAL CENTER FOR ATMOSPHERIC RESEARCH

INTRODUCTION

I thank Chairman Domenici, Ranking Member Bingaman, and the other Members 

of the Committee for the opportunity to speak with you today on the science of global climate change. My name is James W. Hurrell, Director of the Climate and Global Dynamics Division (CGD) at the National Center for Atmospheric Research 

(NCAR) in Boulder, Colorado. My personal research has centered on empirical and 

37

modeling studies and diagnostic analyses to better understand climate, climate variability and climate change. I have authored or co-authored more than 60 peer-reviewed scientific journal articles and book chapters, as well as dozens of other planning documents and workshop papers. I have given more than 65 invited talks 

worldwide, as well as many contributed presentations at national and international 

conferences on climate. I have also convened over one dozen national and international workshops, and I have served on several national and international 

science-planning efforts. Currently, I am extensively involved in the World Climate 

Research Programme (WCRP) on Climate Variability and Predictability (CLIVAR), 

and I serve as co-chair of Scientific Steering Committee of U.S. CLIVAR. I have also 

been involved in the assessment activities of the Intergovernmental Panel on Climate Change (IPCC) as a contributing author to chapters in both the third and 

fourth (in progress) assessment reports, and I have served on several National Research Council (NRC) panels. I am also a lead author on the U.S. Climate Change 

Science Program’s (CCSP) Synthesis and Assessment Product on Temperature 

Trends in the Lower Atmosphere. 

Throughout this testimony I will refer to both the IPCC and the CCSP. Briefly, 

the IPCC is a body of scientists from around the world convened by the United Nations jointly under the United Nations Environment Programme (UNEP) and the 

World Meteorological Organization (WMO). Its mandate is to provide policy makers 

with an objective assessment of the scientific and technical information available 

about climate change, its environmental and socio-economic impacts, and possible 

response options. The IPCC reports on the science of global climate change and the 

effects of human activities on climate in particular. The fourth major assessment 

is underway (the previous assessments were published in 1990, 1995 and 2001) and 

is due to be published in 2007. Each new IPCC report reviews all the published literature over the previous 5 years or so, and assesses the state of knowledge, while 

trying to reconcile disparate claims, resolve discrepancies and document uncertainties. For the 2001 Third Assessment Report (TAR), Working Group I (which deals 

with how the climate has changed and the possible causes) consisted of 123 lead 

authors, 516 contributors, 21 review editors, and over 700 reviewers. It is a very 

open process. The TAR concluded that climate is changing in ways that cannot be 

accounted for by natural variability and that ‘‘global warming’’ is happening. 

The U.S. CCSP was established in 2002 to coordinate climate and global change 

research conducted in the United States. Building on and incorporating the U.S. 

Global Change Research Program of the previous decade, the program integrates 

federal research on climate and global change, as sponsored by 13 federal agencies 

and overseen by the Office of Science and Technology Policy, the Council on Environmental Quality, the National Economic Council and the Office of Management 

and Budget. A primary objective of the CCSP is to provide the best possible scientific information to support public discussion and government and private sector 

decision-making on key climate-related issues. To help meet this objective, the 

CCSP is producing a series of synthesis and assessment products that address its 

highest priority research, observation, and decision-support needs. Each of these 

products will be written by a team of authors selected on the basis of their past 

record of interest and accomplishment in the given topic. The Product on Temperature Trends in the Lower Atmosphere focuses on both understanding reported differences between independently produced data sets of temperature trends for the 

surface through the lower stratosphere and comparing these data sets to model simulations. 

OBSERVED CLIMATE CHANGE

a. Surface Temperature 

Improvements have been made to both land surface air temperature and sea surface temperature (SST) data during the five years since the TAR was published. The 

improvements relate to improved coverage, particularly over the Southern Hemisphere (SH) in the late 19th century, and daily temperature data for an increasing 

number of land stations have also become available, allowing more detailed assessment of extremes, as well as potential urban influences on both large-scale temperature averages and microclimate. 

The globe is warming. Claims to the contrary are not credible. Three different 

analyses of observations of surface temperature averaged across the globe show a 

linear warming trend of 0.6° C ±0.2° C since the beginning of the 20th century. 

Rates of temperature rise are greater in recent decades: since 1979, global surface 

temperatures have increased more than 0.4° C. Land regions have warmed the most 

(0.7° C since 1979), with the greatest warming in the boreal winter and spring 

months over the Northern Hemisphere (NH) continents. A number of recent studies 

38

indicate that effects of urbanization and land-use change on the land-based temperature record are negligible as far as continental-and hemispheric-space averages 

are concerned, because the very real but local effects are accounted for. Recent 

warming is strongly evident at all latitudes over each of the ocean basins and, averaged over the globe, the SSTs have warmed 0.35° C since 1979. The trends over the 

past 25 years have been fairly linear; however the global temperature changes over 

the entire instrumental record are best described by relatively steady temperatures 

from 1861-1920, a warming of about 0.3° C to 1950, a cooling of about 0.1° C until 

the mid-1970s, and a warming of about 0.55° C since then. Thus, global surface temperatures today are about 0.75° C warmer than at the beginning of the 20th century. 

The warmest year in the 145-year global instrumental record remains 1998, since 

the major 1997-98 El Nin ̃ o enhanced it. The years 2002-2004 are the 2nd, 3rd and 

4th warmest years in the series since 1861 and nine of the last 10 years (1995 to 

2004)—the exception being 1996—are among the ten warmest years in the instrumental record. Based on reconstructions of temperature from proxy data, like tree 

rings and ice cores, several studies have also concluded that NH surface temperatures are warmer now than at any time in at least the last 1,000 years. 

b. Consistency with other observed changes 

The warming described above is consistent with a body of other observations that 

gives a consistent picture of a warming world. For example, there has been a widespread reduction in the number of frost days in middle latitude regions, principally 

due to an earlier last day of frost in spring rather than a later start to the frost 

season in autumn. There has been an increase in the number of warm extremes and 

a reduction in the number of daily cold extremes, especially at night. The amount 

of water vapor in the atmosphere has increased over the global oceans by 1.2 ±0.3% 

from 1988 to 2004, consistent in patterns and amount with changes in SST and a 

fairly constant relative humidity. Widespread increases in surface water vapor are 

also found. Ocean temperatures have warmed at depth as well, and global sea levels 

have risen 15-20 centimeters over the 20th century: as the oceans warm, seawater 

expands and sea level rises. 

There has been a nearly worldwide reduction in mountain glacier mass and extent. Snow cover has decreased in many NH regions, particularly in the spring season and this is consistent with greater increases in spring than autumn surface 

temperatures in middle latitude regions. Sea-ice extents have decreased in the Arctic, particularly in the spring and summer seasons, and patterns of the changes are 

consistent with regions showing a temperature increase. The Arctic (north of 65°N) 

average annual temperature has increased since the 1960s and is now warmer (at 

the decade timescale) than conditions experienced during the 1920-1945 period 

(where much of the earlier global warming was centered). In the Antarctic, there 

are regional patterns of warming and cooling related to changes in the atmospheric 

circulation. The warming of the Peninsula region since the early 1950s is one the 

largest and the most consistent warming signals observed anywhere in the world. 

Large reductions in sea-ice have occurred to the west in the Bellingshausen Sea, 

and on the eastern side of Peninsula, large reductions in the size of Larsen Ice shelf 

have occurred. 

c. Temperature of the Upper Air 

Radiosonde releases provide the longest record of upper-air measurements, and 

these data show similar warming rates to the surface temperature record since 

1958. Unfortunately, however, vast regions of the oceans and portions of the 

landmasses (especially in the Tropics) are not monitored so that there is always a 

component of the global or hemispheric mean temperature that is missing. Moreover, like all measurement systems, radiosonde records of temperature have inherent uncertainties associated with the instruments employed and with changes in instrumentation and observing practices, among other factors. 

Fundamentally, these uncertainties arise because the primary purpose of 

radiosondes is to help forecast the weather, not monitor climate variability and 

change. Therefore, all climate data sets require careful examination for instrument 

biases and reliability (quality control) and to remove changes that might have arisen 

for non-climatic reasons (a process called ‘‘homogenization’’) It is difficult to remove 

all non-climatic effects, and ideally multiple data sets should be produced independently to see how sensitive results are to homogenization choices. This has been the 

case for the surface record, but unfortunately much less so for the radiosonde record 

(although efforts are increasing.) 

For this reason, much attention has been paid to satellite estimates of upper-air 

temperatures, in particular because they provide true global coverage. Of special inVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00042 Fmt 6633 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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terest have been estimates of tropospheric and stratospheric temperatures over 

thick atmospheric layers obtained from microwave sounding units (MSU) onboard 

NOAA polar-orbiting satellites since 1979. Initial analyses of the MSU data by scientists at the University of Alabama, Huntsville (UAH) indicated that temperatures 

in the troposphere showed little or no warming, in stark contrast with surface air 

measurements. Climate change skeptics have used this result to raise questions 

about both the reliability of the surface record and the cause of the surface warming, since human influences thought to be important are expected to increase temperatures both at the surface and in the troposphere. They also have used the satellite record to caste doubt on the utility of climate models, which simulate both surface and tropospheric warming in over recent decades. 

In an attempt to resolve these issues, the NRC in 2000 studied the problem and 

concluded that ‘‘the warming trend in global-mean surface temperature observations 

during the past 20 years is undoubtedly real and is substantially greater than the 

average rate of warming during the 20th century. The disparity between surface 

and upper air trends in no way invalidates the conclusion that surface temperature 

has been rising.’’ The NRC further found that corrections in the MSU processing 

algorithms brought the satellite data record into slightly closer alignment with surface temperature trends, but substantial discrepancies remained. As further noted 

by the TAR, some, but not all, of these remaining discrepancies could be attributed 

to the fact that the surface and the troposphere respond differently to climate 

forcings, so that trends over a decade or two should not necessarily be expected to 

agree. 

Since the IPCC and NRC assessments, new data sets and modeling simulations 

have become available which are helping to resolve this apparent dilemma. The 

CCSP Assessment Product on Temperature Trends in the Lower Atmosphere is assessing these new data, and the preliminary report (which has been reviewed by the 

NRC) finds that the surface and upper-air records of temperature change can now, 

in fact, be reconciled. Moreover, the overall pattern of observed temperature change 

in the vertical is consistent with that simulated by today’s climate models. 

Several developments since the TAR are especially notable:

• A second, independent record of MSU temperatures has become available from 

scientists at the Remote Sensing Systems (RSS) Laboratory. Although both the 

UAH and RSS groups start from the same raw radiance data, they apply different construction methods of merging the MSU data from one satellite to the 

next. The result is that, while both data sets indicate the middle troposphere 

has warmed since 1979, the RSS estimate is approximately 0.1° C decade¥1

warmer than the UAH estimate. Moreover, the RSS trend is not statistically 

different from the observed surface warming since 1979. The difference in tropospheric temperature trends between these two products highlights the issue of 

temporal homogeneity in the satellite data. 

• Both UAH and RSS MSU products support the conclusion that the stratosphere 

has undergone strong cooling since 1979, due to observed stratospheric ozone 

depletion. 

• Because about 15% of the MSU signal for middle tropospheric temperature actually comes from the lower stratosphere, the real warming of the middle troposphere is greater than that indicated by the MSU data sets. This has been confirmed by new analyses that explicitly remove the stratospheric influence, 

which is about ¥0.08° C decade¥1 on middle tropospheric MSU temperature 

trends since 1979. 

• By differencing MSU measurements made at different slant angles, both the 

UAH and the RSS groups have produced updated data records weighted more 

toward the lower troposphere. The RSS product exhibits a warming trend that 

is 0.2° C decade¥1 larger than that from UAH. In part, this discrepancy is because adjustments for diurnal cycle corrections required from satellite drift had 

the wrong sign in the UAH record. As a result, a new UAH record is being prepared, and the current version is regarded as obsolete.

The various new data sets of upper-air temperature are very important because 

their differences highlight differences in construction methodologies. It therefore becomes possible to estimate the uncertainty in satellite-derived temperature trends 

that arises from different methods. 

d. Extremes 

For any change in mean climate, there is likely to be an amplified change in extremes. The wide range of natural variability associated with day-to-day weather 

means that we are unlikely to notice most small climate changes except for changes 

in the occurrence of extremes. Extreme events, such as heat waves, floods and 

40

droughts, are exceedingly important to both natural systems and human systems 

and infrastructure. We are adapted to a range of natural weather variations, but 

it is the extremes of weather and climate that exceed tolerances. 

In several regions of the world indications of a change in various types of extreme 

weather and climate events have been found. So far, the most prominent indication 

of a change in extremes is the evidence of increases in moderate to heavy precipitation events over the middle latitudes in the last 50 years, even for regions where 

annual precipitation totals are decreasing. Further indications of a robust change 

include the observed trend to fewer frost days associated with the average warming 

in most middle latitude regions. Results for temperature-related daily extremes are 

also relatively coherent for some measures. Many regions show increased numbers 

of warm days/nights (and lengthening of heat waves) and even more reductions in 

the number of cold days/nights, but changes are not ubiquitous. 

Trends in tropical storm frequency and intensity are masked by large natural variability on multiple timescales. Increases may be occurring in recent years, but 

apart from the North Atlantic basin, most measures only begin in the 1950s or 

1960s and have likely missed some events in the early decades. Numbers of hurricanes in the North Atlantic have been above normal in 8 of the last 10 years, but 

levels were about as high in the 1950s and 1960s. This pattern continues this summer, with a very active hurricane season already evident and SSTs at record high 

levels. 

MODELING AND ATTRIBUTION OF CLIMATE CHANGE

a. Improved simulations of past climate 

The best climate models encapsulate the current understanding of the physical 

processes involved in the climate system, the interactions, and the performance of 

the system as a whole. They have been extensively tested and evaluated using observations. They are exceedingly useful tools for carrying out numerical climate experiments, but they are not perfect, and some models are better than others. Uncertainties arise from shortcomings in our understanding of climate processes operating 

in the atmosphere, ocean, land and cryosphere, and how to best represent those 

processes in models. Yet, in spite of these uncertainties, today’s best climate models 

are now able to reproduce the climate of the past century, and simulations of the 

evolution of global surface temperature over the past millennium are consistent 

with paleoclimate reconstructions. 

As a result, climate modelers are able to test the role of various forcings in producing the observed changes in global temperature temperatures. Forcings imposed 

on the climate system can be natural in origin, such as changes in solar luminosity 

or volcanic eruptions, the latter adding considerable amounts of aerosol to the upper 

atmosphere for up to two years. Human activities also increase aerosol concentrations in the atmosphere, mainly through the injection of sulfur dioxide from power 

stations and through biomass burning. A direct effect of sulfate aerosols is the reflection of a fraction of solar radiation back to space, which tends to cool the Earth’s 

surface. Other aerosols (like soot) directly absorb solar radiation leading to local 

heating of the atmosphere, and some absorb and emit infrared radiation. A further 

influence of aerosols is that many act as nuclei on which cloud droplets condense, 

affecting the number and size of droplets in a cloud and hence altering the reflection 

and the absorption of solar radiation by the cloud. The precise nature of aerosol/

cloud interactions and how they interact with the water cycle remains a major uncertainty in our understanding of climate processes. Because man-made aerosols are 

mostly introduced near the Earth’s surface, they can be washed out of the atmosphere by rain. They therefore typically remain in the atmosphere for only a few 

days, and they tend to be concentrated near their sources such as industrial regions. 

Therefore, they affect climate with a very strong regional pattern and usually 

produce cooling. 

In contrast, greenhouse gases such as carbon dioxide and methane are not washed 

out, so they have lifetimes of decades or longer. As a result, they build up in 

amounts over time, as has been observed. Greenhouse gas concentrations in the atmosphere are now higher than at any time in at least the last 750,000 years. It took 

at least 10,000 years from the end of the last ice age for levels of carbon dioxide 

to increase 100 parts per million by volume (ppmv) to 280 ppmv, but that same increase has occurred over only the past 150 years to current values of over 370 ppmv. 

About half of that increase has occurred over the last 35 years, owing mainly to 

combustion of fossil fuels and deforestation. In the absence of controls, future projections are that the rate of increase in carbon dioxide amount may accelerate, and 

concentrations could double from pre-industrial values within the next 50 to 100 

years. 

41

Climate model simulations that account for such changes in forcings have now reliably shown that global surface warming of recent decades is a response to the increased concentrations of greenhouse gases and sulfate aerosols in the atmosphere. 

When the models are run without these forcing changes, they fail to capture the almost linear increase in global surface temperatures since the mid-1970s. But when 

the anthropogenic forcings are included, the models simulate the observed temperature record with impressive fidelity. These same model experiments also reveal that 

changes in solar luminosity account for much of the warming in the first half of the 

20th century. Such results increase our confidence in the observational record and 

our understanding of how temperature has changed. They also mean that the time 

histories of the important forcings are reasonably known, and that the processes 

being simulated models are adequate enough to make the models very valuable 

tools. 

b. Commitment to further climate change 

The ability of climate models to simulate the past climate record gives us increased confidence in their ability to simulate the future. Moreover, the attribution 

of the recent climate change to increased concentrations of greenhouse gases in the 

atmosphere has direct implications for the future. Because of the long lifetime of 

carbon dioxide and the slow equilibration of the oceans, there is a substantial future 

commitment to further global climate change even in the absence of further emissions of greenhouse gases into the atmosphere. Several modeling groups have performed ‘‘commitment’’ runs in order to examine the climate response even if the concentrations of greenhouse gases in the atmosphere had been stabilized in the year 

2000. The exact results depend upon the model, but they all show a further global 

warming of about another 0.5° C, and additional and significant sea level rises 

caused by thermal expansion of the oceans by the end of the 21st century. Further 

glacial melt is also likely. 

The climate modeling groups contributing to the Fourth IPCC Assessment Report 

have produced the most extensive internationally coordinated climate change experiment ever performed (21 global coupled models from 14 countries). This has allowed 

better quantification of multi-model responses to three scenarios of 21st century climate corresponding to low (550 ppmv), medium (690 ppmv) and high (820 ppmv) 

increases of carbon dioxide concentrations by the year 2100. In spite of differences 

among models and the uncertainties that exist, the models produce some consistent 

results:

• Over the next decade or two, all models produce similar warming trends in 

global surface temperatures, regardless of the scenario. • Nearly half of the early 21st century climate change arises from warming we 

are already committed to. By mid-century, the choice of scenario becomes more 

important for the magnitude of warming, and by the end of the 21st century 

there are clear consequences for which scenario is followed. • The pattern of warming in the atmosphere, with a maximum in the upper tropical troposphere and cooling in the stratosphere, becomes established early in 

this century. • Geographical patterns of warming show greatest temperature increases at high 

northern latitudes and over land, with less warming over the southern oceans 

and North Atlantic. In spite of a slowdown of the meridional overturning circulation and changes in the Gulf Stream in the ocean across models, there is 

still warming over the North Atlantic and Europe due to the overwhelming effects of the increased concentrations of greenhouse gases. • Precipitation generally increases in the summer monsoons and over the tropical 

Pacific in particular, with general decreases in the subtropics and some middle 

latitude areas, and increases at high latitudes.

c. Increasing complexity of models 

As our knowledge of the different components of the climate system and their 

interactions increases, so does the complexity of climate models. Historical changes 

in land use and changes in the distribution of continental water due to dams and 

irrigation, for instance, need to be considered. Future projected land cover changes 

due to human land uses are also likely to significantly affect climate, and these effects are only now being included in climate models. 

One of the major advances in climate modeling in recent years has been the introduction of coupled climate-carbon models. Climate change is expected to influence 

the capacities of the land and oceans to act as repositories for anthropogenic carbon 

dioxide, and hence provide a feedback to climate change. These models now allow 

us to assess the nature of this feedback. Results show that carbon sink strengths 

are inversely related to the rate of fossil fuel emissions, so that carbon storage caVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00045 Fmt 6633 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
42

pacities of the land and oceans decrease and climate warming accelerates with faster carbon dioxide emissions. Furthermore, there is a positive feedback between the 

carbon and climate systems, so that further warming acts to increase the airborne 

fraction of anthropogenic carbon dioxide and amplify the climate change itself. 

POLICY IMPLICATIONS

In summary, the scientific understanding of climate change is now sufficiently 

clear to show that climate change from global warming is already upon us. Uncertainties remain, especially regarding how climate will change at regional and local 

scales. But the climate is changing and the uncertainties make the need for action 

all the more imperative. At the same time, it should be recognized that mitigation 

actions taken now mainly have benefits 50 years and beyond now. This also means 

that we will have to adapt to climate change by planning for it and making better 

predictions of likely outcomes on several time horizons. My personal view it that it 

is vital that all nations identify cost-effective steps that they can take now, to contribute to substantial and long-term reductions in net global greenhouse gas emissions. Action taken now to reduce significantly the build-up of greenhouse gases in 

the atmosphere will lessen the magnitude and rate of climate change. While some 

changes arising from global warming are benign or even beneficial, the rate of 

change as projected exceeds anything seen in nature in the past 10,000 years. It 

is apt to be disruptive in many ways. Hence it is also vital to plan to cope with 

the changes, such as enhanced droughts, heat waves and wild fires, and stronger 

downpours and risk of flooding. Managing water resources will be major challenge 

in the future. 

Again, I appreciate the opportunity to address the Committee concerning the 

science of global climate change—a topic that is of the utmost importance for the 

future of our planet.

The CHAIRMAN. And thanks to all of you. Now let us see if we 

have enough Senators. Do we? 

[Whereupon, a business meeting was held from 10:47 a.m. to 

10:49 a.m.] 

The CHAIRMAN. Now we are going to proceed. We have one set 

of panels—or one panel after this. We want to get them up before 

noon. But we really do want every Senator that wants to to ask 

questions. 

I am going to start with you, Senator Bingaman, then with you, 

Senator Craig, and go right down the line. 

Senator Bingaman. 

Senator BINGAMAN. Well, thank you very much, Mr. Chairman. 

One of the issues that I think several of you alluded to that I think 

is important to focus on here is the length of time that gases that 

we emit today remain in the atmosphere, and the fact that by continuing to add to the greenhouse gases, we buildup a store that 

takes decades and even centuries to settle back out. I guess that 

is what eventually happens to the greenhouse gases in the atmosphere, although I am not sure of that. 

Maybe Dr. Hurrell, you could address that, and anybody else who 

had a comment as to what the science tells us about the length of 

time that these gases are going to remain there and continue to 

cause increasing temperatures. 

Dr. HURRELL. You are correct, Senator Bingaman. The lifetime 

of greenhouse gases in the atmosphere is on the time scale of decades to centuries. And so the buildup of greenhouse gases in the 

atmosphere continues to accumulate over time. And so some of the 

experiments, in terms of the impacts that we do with climate models, some new types of experiments, are what we call commitment 

runs. 

For instance, if emissions were capped at today’s levels, what 

would happen in the future because of the continued buildup of 

43

greenhouse gas concentrations in the atmosphere? And those climate model simulations do indicate that there will be a continued 

increase in global surface temperatures that we are already committed to. Something on the order of approaching another degree 

Fahrenheit over the next 50 years. And sea levels will continue to 

rise as well. 

Senator BINGAMAN. All right. Dr. Cicerone, did you have any 

comment on that? 

Dr. CICERONE. Yes, Senator Bingaman. Carbon dioxide is clearly 

the most important human-caused greenhouse gas, and I agree 

completely with what Dr. Hurrell said. The other greenhouse gas 

is methane, which has a residence time of 10 or 12 years. So that 

it is much more susceptible to short-term changes and to our increasing the emissions or decreasing the emissions. We should see 

changes in methane more quickly. 

Nitrous oxide, 150 years. There are some exotic chemicals, which 

although present in much smaller amounts, survive for tens of 

thousands of years. Sulfurhexaflouride and some pro-fluorinated 

hydrocarbons, which were produced inadvertently by the aluminum 

industry, which I think has been somewhat successful in eliminating those emissions. So there is a spectrum. 

One of the greenhouse gases is much shorter lived. It is ozone 

produced in ground-level air pollution. Chemistry reactions may 

survive only a couple hundred days. But the principal one is exactly as Dr. Hurrell said. 

Senator BINGAMAN. Let me ask one other question. All the discussion so far this morning that I have been listening to relates to 

incremental changes in climate that we can anticipate if we continue to emit the level of greenhouse gases we are currently emitting, or the amounts we are expected to emit in the future. 

What could you tell us about the issue of abrupt climate change? 

This is something that I hear about and how does this relate to 

what the testimony that you have given on this other issue? 

Sir HOUGHTON. Maybe I should have a go at that. Climate is a 

very non-linear system, so that you may go along without too much 

change, then all of a sudden something happens, because a threshold or something has been reached. We do not know of any very 

tight thresholds, but we do know that certain things are happening 

which could lead to very large effects. And one of those is the meltdown of Greenland, for instance, a certain threshold. Greenland is 

in balance at the moment, roughly speaking, between a glacier on 

the outside, and accumulation in the middle. 

Now if that starts to change rapidly, then Greenland will begin 

to melt down. It will maybe take a thousand years or more, but 

there is seven meters of sea level which lies within Greenland. 

Furthermore, which, of course, has been well publicized in that 

film, ‘‘The Day After Tomorrow’’—you need not believe all of it, by 

any means. You need not believe the speculative events which occurred afterwards. But the signs on which it is predicated is the 

weakening of the Gulf Stream. And all the climate models, the coupled ocean atmosphere climate models that couple the two circulations together, show this effect. 

As you freshen the water in the higher latitudes, because of increased precipitation or because of melting ice, then this stops the 

44

water in the ocean becoming so salty. It becomes less dense, and 

therefore, it does not sink to the bottom and start to form the deep 

ocean circulation, which circulates between all the oceans. And 

what happens is that that then weakens the whole of the Gulf 

Stream circulation and will have profound impacts on the weather, 

particularly of Western Europe, but not as severe, on the whole 

globe. 

As I say, all climate models show that weakening, while a few 

of them show it cutting it off after a few hundred years or so. There 

is still a lot of debate about the timing of that. But the fact that 

that could occur is really very, very well understood now, and probably will occur in the future. 

There is also the breakdown of the West Antarctic ice sheet, 

which is another possible threshold. There are other things, like release of methane from sources in the deep oceans or in the ice. 

That is the further one which we are concerned about, but the evidence of that is not too strong. But all these things are there in 

the wings, or in the possibilities, which we shall be aware of even 

if we are concentrating on the things we are more sure about. 

Dr. MOLINA. Can I add something to that? I just want to point 

out that the risks to human society of these abrupt changes increase rapidly as the amount of greenhouse gases in the atmosphere increases. It is very non-linear. But, to put it in simple 

terms, if we double the amount of greenhouse gases in the atmosphere, the risk does not double. Perhaps it quadruples or perhaps 

it increases even a factor of ten. So we have a very non-linear response. We get into a very dangerous situation as we increase the 

amount of these gases. 

Senator BINGAMAN. Thank you, Mr. Chairman. 

Senator CRAIG. Let me thank all of you for being here. I have 

read many of your works and a lot of the publications over the last 

decade and have been fully engaged in this issue, both as an observer and sometimes a critic. But I have grown to believe, as 

many of my colleagues have, that there is a substantial human effect on the environment. And you have outlined that in a variety 

of ways this morning. 

My responsibility is best I can, is to question the science, but at 

the same time, as the science seems to confirm human activity as 

a major contributor. Climate variability is something that I think 

we are all very willing to look at and see as a part of it. So it is 

very important for us, as policymakers, to insist that you all get 

it right as best science can. 

Having said that, let me revert back to where I think I and others on this committee play the role, and that is in the policy formed 

and how we get there. Many of you have said that no matter what 

we do, this very big world of ours is a ship that turns with great 

slowness. And I am extremely concerned, in a positive/negative 

way, about the growth of emerging economies and their contribution, and what we can do not only for ourselves, but with them and 

for them. 

Abrupt changes in our approach toward adjusting create consequences. And, therefore, technologies are extremely important, I 

think. Clean technologies, in not only moving us in the right direction, but moving the world in the right direction, because this great 

45

Nation of ours makes almost everything that we produce available 

to the rest of the world. And we have that tremendous capacity. We 

just produced legislation that I think is of substantially greater significance to climate change than anything we have done to date. 

I have traveled the world. I have been to most of the climate 

change conferences. I know the world is now recognizing that without new technologies it cannot get to where it wants to get in relation to certain international protocols. 

Do you believe and are you all advocates of moving electrical generation in this country and around the world toward a non-emitting 

source? And I, of course, must emphasize baseload. And do you 

support new nuclear-generating technologies to accomplish that? 

Any of you wish to respond to that? 

Dr. MOLINA. Perhaps I can make one comment there, which is 

along the lines of the report of the National Commission on Energy 

Policy where these things are documented to much more extent. 

What I believe personally is that it is very important for society 

to leave all options open. And that certainly includes nuclear energy as well. And given the current circumstances, the way society 

deals with nuclear energy, particularly in this country, including 

others, unless there is some government intervention to maintain 

this option, to make it safer, and to have it as a possibility for the 

future, it will not happen, because there is no incentive for industry to continue doing that. 

So I do believe it is very important, particularly along those lines 

that you mentioned, of having new technologies to move in that direction, to have this option, and for it to be safe. I will not repeat 

here the problems that we have had, since you are probably very 

familiar with them, but it does require resources to ensure that 

this happens. Thank you. 

Sir HOUGHTON. May I answer that? I think it is very clear there 

is no one solution to the problem of getting to a situation within 

a generation of carbon-free energy. There are many possibilities. 

And you have mentioned the nuclear one, and that is clearly one 

of the options that needs considering. 

My personal view on that is I am concerned about proliferation 

of nuclear material. The world really—of course, we are not just 

looking at the United States, or the United Kingdom, or Europe. 

Senator CRAIG. No, we are looking at the world. 

Sir HOUGHTON. We are looking at the whole world, which needs 

these energies. And the proliferation of nuclear material is something we have to be very careful about. And as a long-term solution, I would worry about that. Nevertheless, I do think it has to 

come into the debate. 

The other point I would make is that India and China have a 

great deal of coal. China is building a gigawatt power station every 

5 days at the moment. And so some way, somehow we have to very 

rapidly move to clean zero carbon coal technology. And that can be 

done with sequestration. 

I know the European Union is going to talk to China later this 

year about the possibility of helping China with that. I am sure the 

United States could help China with that also, but it needs to be 

done rather soon, because they are moving ahead so fast with their 

greenhouse gas emissions. 

46

Senator CRAIG. Thank you all. 

The CHAIRMAN. Okay. We are going to go now, I think it is back 

to the regular order. Senator Akaka, I think you are next. 

Senator AKAKA. Thank you very much, Mr. Chairman. 

Dr. Cicerone, in your testimony—and I am following up on Senator Bingaman’s question. In your testimony you talked about abrupt climate change; what is abrupt climate change? And can you 

identify any critical thresholds that might be crossed if we do not 

take strong action to control carbon dioxide emissions? 

For example, I have heard that at certain temperature degree increases, large sheets of ice in the Arctic could melt and collapse, 

leading to huge increases in sea level. Can you comment on that 

and other potential threshold events? 

Dr. CICERONE. I will try, Senator Akaka. About 21⁄2 years ago or 

so the Academy did a study and created a report called ‘‘Abrupt 

Climate Change and the Potential for Surprises,’’ largely in response to findings over the last 15 or 20 years that previously the 

earth’s climate was thought to change slowly and gradually. But I 

would say in the last 20 years or so that scientists, by reading the 

record of isotopes in minerals and fossils of living organisms, and 

water pattern flows and so forth, we found evidence of previous climate change on earth. There have been many, many examples of 

rapid change. 

Changes in ocean circulation, for example, that have occurred in 

periods so short that we are not even sure we are measuring how 

short they are. Ten to 50 to 100 years instead of thousands of 

years. So as more of these examples arose in the scientific literature, people began to take more seriously the fact that the earth 

can change abruptly. 

When we try to figure out what those thresholds are, people have 

had difficulty, and have not yet been able to explain what kind of 

event could trigger a hemispheric or global change that could occur 

in 10 to 50 years. I do not think we understand the mechanisms 

very well yet, but we have powerful evidence that there are mechanisms built into this complicated system that have thresholds connected with them. 

So the kinds of examples that Dr. Houghton and Dr. Hurrell 

gave early are on our minds. We cannot prove it yet. The most recent academy report on abrupt climate change with that title was 

2 or 3 years ago. And I can try to extract some more examples to 

send. 

The Antarctic ozone hole that developed over Antarctica, fortunate in some respect that it happened over relatively unpopulated 

areas, although our colleagues in New Zealand and Australia and 

southern Chile do not agree with that statement, happened for unknown reasons at the time. 

Dr. Molina and his research group, and one of the reasons he 

was awarded the Nobel Prize in 1995, was helping to come up with 

the mechanisms that were previously not understood. Thresholds 

which could cause ozone depletion to occur very rapidly in one 

place of the world, which were not understood originally. 

There must be mechanisms like that in the climate system, too, 

which are not fully understood yet. We have ideas, plausible ideas, 

but not proof of where these thresholds lie, in my opinion. 

47

Senator AKAKA. Dr. Cicerone, how would you suggest that island 

nations and states deal with potential abrupt climate changes? In 

other words, how likely are they to occur and is there anything we 

can do now to prevent or prepare for them, as island nations and 

states? 

Dr. CICERONE. I think they generally see the risks much more 

ominously than we do, with such a large continent and Hawaii and 

Alaska, as part of the United States. The island nations feel more 

risk. But generally, the precautions that we can take, by moving 

our water treatment plants further up the river, further up from 

sea level, to protect them from saltwater intrusion. Borders that we 

can put up by moving installations now to prepare for slower 

changes. 

We have so much technology. We have capital. We have scientific 

ability to foresee that many of the island nations do not have all 

those ingredients. So they are feeling more threatened. I have not 

thought from the point of view of island nations, but I know that 

they take these issues more seriously than we do. 

We have been planning over an entire generation of installations 

to make moves now, which can be done on a cost neutral or beneficial basis, which will not be available if the changes turn out to 

be sudden, and island nations start to become submerged. 

Senator AKAKA. Thank you for your responses, Dr. Cicerone. 

Thank you, Mr. Chairman. My time has expired. 

The CHAIRMAN. Thank you, Senator. 

Let me say to the witnesses, if you wonder what is happening, 

there is a vote going on, and we are trying to accommodate the voters and you, and not close up shop. So we are going to continue 

to try to do that. 

On our side, Senator Alexander should be next, but he indicated 

he was going to vote and then come back. Senator Murkowski 

went. She will be back. Senator Salazar. Then Talent, Thomas. 

How would we like to proceed? Senator Salazar is not here. 

Senator Thomas, did you come here before Senator Talent? 

Senator THOMAS. I do not know. Mr. Chairman, I am waiting for 

some material anyway. 

The CHAIRMAN. All right. 

Senator THOMAS. So I am happy to yield to my friend. 

The CHAIRMAN. We are going to go to Senator Thomas. 

Senator THOMAS. All right. Fine. Thank you. We need some scientific effort on how we——

The CHAIRMAN. We need a Nobel Prize. 

[Laughter.] 

Senator THOMAS. I appreciate you being here. Certainly, all of us 

understand the importance of this issue. It is a difficult issue. I 

have been to Milan, to Buenos Aires, to the Kyoto agreements, and 

our Kyoto conversations, and that lack of agreement, I might say. 

But it is interesting. And we need to work at it. We are committed 

to that. I guess the question is: What do we do? 

Sir Houghton, you mentioned your studies. Your third IPCC assessment was largely based on the Mann so-called hockey stick 

graph, which shows neither warming nor ice age. Do you endorse 

that study, or do you believe that there is still some work to be 

done? 

48

Sir HOUGHTON. If I could just comment on that. The hockey stick 

debate is only a very small discussion within the IPCC process. The 

hockey stick debate addresses the issue of global temperature from 

the year 1000 to the start of the instrumental record, which began 

about 1860. Regarding the records since 1860, there is no question 

of that being correct, because that is a very good record. 

Trying to reconstruct the data for the previous period involves 

proxy data. This is data from tree rings, from pollen sources, from 

a whole range of indicators of temperature. And those need calibrating against the instrumental record. That calibration process 

and the way this is done——

Senator THOMAS. I think my point is that there is a difference. 

As you go to these meetings—and what you have said scientifically 

is not agreed to by everyone. And so I guess I am saying do we 

have——

Sir HOUGHTON. Okay. Let me now explain it——

Senator THOMAS. We do not have time to do all the details. 

Sir HOUGHTON. No. Well, let me just explain in detail, but let me 

just say that the point of issue is just the reconstruction of that 

temperature from 1000 to 1860. Now there are various reconstructions within the literature that is debated within the reconstruction, about those reconstructions. There is nothing within any of 

those constructions which are being properly published that puts 

any jeopardy whatever to the main statements of the IPCC regarding the temperature of the 20th century, the increase in that temperature, and all the statements you have heard already. 

So there is some debate about it, and I do not dispute that debate. But there is debate about many issues in science, and the 

whole science of various parts of the IPCC. And that is not a big 

issue. It is not an issue that affects our main conclusions at all. 

Senator THOMAS. Well, it affects the conclusions that we have to 

make, and you said, as a matter of fact, that we need to be taking 

some action. Well, the fact is that we are taking action. And the 

question, if you go to Kyoto, why it is a matter of setting limits, 

and then some countries trading off and selling their credits to others. It has to do with economy. Nothing to do with the environment. 

We are spending more than the rest of the world all put together 

in doing research—$6 billion a year. I kind of get the impression 

that we have not made any decisions and we are not moving forward. But what more do you think we can do? 

Sir HOUGHTON. What more you could do is to address this issue. 

And I cannot give you——

Senator THOMAS. Well, we spend $6 billion a year addressing 

this issue. 

Sir HOUGHTON. But that is—it is a big issue. And you have to 

look at—I am not an economist, and I am not a politician. 

Senator THOMAS. No. 

Sir HOUGHTON. I am a scientist who comes to this and tells you 

there is a real problem. The world is facing a real problem. Many 

countries of the world are taking action to meet that problem. And 

we just would like the United States to begin to show some leadership in this area so that they are part of the solution as well as 

not part of the problem. 

49

Senator THOMAS. I am trying to tell you that we are spending 

more than the rest of the world put together——

Sir HOUGHTON. But then you are emitting more than the 

world——

Senator THOMAS [continuing]. In seeking to do something——

Sir HOUGHTON. You are emitting a very large—you know, you 

are emitting——

Senator THOMAS. We have an economy here that is larger than 

anyone else’s. 

Sir HOUGHTON. Okay. 

Senator THOMAS. I mean it is not easy. It is a different thing to 

sit there on the scientific end and talk about all these things. It 

is quite different to say, ‘‘All right. What are we going to do about 

it?’’ Now I understand that is not your role. It is our role. But we 

need to talk a little about both sides of the issue. I have used up 

my time. 

Sir HOUGHTON. But Senator, could I just say, we are not just scientists doing it for the sake of the science. Although science is very 

exciting and very interesting. We believe that there are very severe 

problems with humankind, severe damages to your country as a result of this. 

Senator THOMAS. How about solutions? 

Sir HOUGHTON. Severe damages to other countries, too, because——

Senator THOMAS. How about solutions? 

Sir HOUGHTON. And the solutions are to move the way we get 

our energy from being a——

Senator THOMAS. And we are doing more of that anybody else in 

the world. 

Dr. MOLINA. If I can add to that, there are several options. There 

are many ways to actually address the problem. And the example 

I gave from the National Commission on Energy Policy is one example I think Senator Bingaman is discussing and considering for 

action. 

It is not enough to do the science. It is not enough to invest, 

which is terribly important. And the point is, much can be done. 

It does not have to be Kyoto, but definitely much can be done to 

start limiting the nations without adverse economic impacts. 

You will hear more perhaps from the second panel on the details. 

We, as scientists, simply expose what the enormous risks might be 

if we do not do it. 

Senator THOMAS. Yes. I understand. 

Dr. MOLINA. But we also, as individuals, can, of course, have 

strong statements that much can be done that is not being done. 

And that is a point without affecting the economy in a negative 

way. For example, going beyond voluntary measures to limit the 

nations. That can certainly be done. 

Senator THOMAS. We also have to balance that. I do not want to 

argue with you, but the economy—we go through this Kyoto, and 

we go through it all the time. It is not a new issue. And we are 

trying to find a way to deal with the problem without putting great 

limits on the economy. And frankly, you can sit in your scientific 

seat, if you want to, and not worry about the economy, but you cannot do that when you are making the decisions. 

50

Dr. MOLINA. That is why I gave the example of—the specific example of the National——

Senator THOMAS. And you talked about nuclear. France is using 

nuclear almost entirely. You said maybe we could do it. Illinois, 40 

percent of their electricity is already generated by nuclear. It is not 

a brand new idea. Yes, sir. I am taking too much time. 

Dr. CICERONE. I think we all sympathize with the enormous responsibility that you feel. One of the statements that the science 

academies of the G8 nations and the other three just made was 

that it is vital that all nations identify cost-effective steps that they 

can take now to contribute to substantial and long-term reduction 

in that global greenhouse gas emissions. That statement did not 

try to make political choices, recognize the need. 

I just jotted down seven quick thoughts on the values of energy 

efficiency that I think we would all agree with. From the United 

States’ point of view, our manufacturing sector uses 50 or 60 percent more energy to produce a widget than, let us say, our competitors in Japan and Germany do. And when the energy costs get as 

high as they are now, that is a significant fraction of the product 

cost. 

Now if we could help to find ways to manufacture more efficiently, there would be a win-win there. We have a strategic reliance on foreign oil that I do not think any American is comfortable 

with. If we could increase our energy efficiency and decrease that 

strategic reliance on foreign oil. You have thought about this a lot. 

We have local and regional air pollution issues that, again, arise 

from the more inefficient burning of fuels for energy. If we could 

increase the efficiency, we could decrease that problem. 

We have a balance of trade issue. I just sketched this out. I could 

be wrong, but our current usage of foreign oil is contributing maybe 

$200 billion a year to our trade deficit. We could reduce the trade 

deficit by increasing our energy efficiency. 

We have the climate change issue, where we all want to slow 

down the emissions of carbon dioxide. If we could increase our energy efficiency with all that means from our business and commercial sector. 

We worry about the illicit usages of the money that we are 

spending on foreign oil. Where is that money going? You probably 

know the answer better than we do. And I am not sure you have 

it all either. 

And then finally, there is a world market for energy-efficient devices. If we could somehow create incentives for our companies to 

create those energy—so there are seven win-win-win propositions 

here. 

Senator CRAIG. And those are very good. As you well know, we 

are right now in the middle of our energy policy development between the House and the Senate, and many of these things are 

there. And so we are moving in that direction. 

Dr. CICERONE. The win-win ones. 

Senator CRAIG [presiding]. I hope so. Thank you. I appreciate 

your specifics. 

Senator. 

51

Senator CORZINE. Thank you. And thank the panel. This is an 

extraordinary presentation that I think should capture the imagination of not just the U.S. public’s eye, but globally. 

I want to piggyback on Senator Craig. I will probably be—might 

come at it from a different angle, but I would like each of you to 

speak to the one or two initiatives that you think, whether it is 

through conservations or efficiencies, as Dr. Cicerone said, or is it 

through alternative production elements that you think would fit 

into the portfolio that we should be investing in to address this 

issue on a long-term basis. And having been someone who is involved in business, it may not be profitable in the short run, each 

of those things, but in the long run, may have huge return profiles. 

So I would like you, within the best of your judgment, to identify 

those things that have the highest return profile over some period 

of time. So it is relatively open ended, but I would like to know 

what that portfolio of actions are that address what you have so 

ably described as a real problem for mankind. 

Start with Dr. Molina. 

Dr. MOLINA. It is a tough question, because my conclusion is that 

we do need to leave open a whole variety of options. The way I 

would put it is that what is very important to do is to—there has 

to be some government intervention that goes beyond voluntary 

measures to have a strong market signal, so that the market itself 

chooses what are the best options to limit the emission of greenhouse gases. 

Clearly, as Dr. Cicerone pointed out, increasing energy efficiency 

is a very obvious one. Using the energy sources that do not consume fossil fuels, renewable energy sources——

Senator CORZINE. The fact is, though, that energy efficiencies 

might not be in the short run 1 year, 2 years, 5 years market viable——

Dr. MOLINA. That is right. 

Senator CORZINE [continuing]. Relative to long-term return profiles. 

Dr. MOLINA. Yes. 

Senator CORZINE. So are the efficiencies that were spoken about, 

do they have return profiles over a period of time, and where 

should we be focusing our exploration if we are trying to have the 

greatest impact on these issues as we go forward? 

Dr. MOLINA. Well, just to make the point again, that is why it 

is very difficult to point any one or two solutions, and you have to 

let society choose the best. Energy efficiency alone will not solve 

the problem. 

Another very important aspect for the long term, which I consider absolutely essential, is to continue investing in developing 

new technologies, and in particular, to work with the developing 

world along these lines. 

Senator CORZINE. Such as? 

Dr. MOLINA. Well, first of all, there are issues with fossil fuel 

usage, such as carbon capture. That is in the works. It will, of 

course, cost more, but society can certainly afford it if it is done 

properly. So proper use of coal and other fossil fuels without affecting the environment. But then we mentioned——

52

Senator CORZINE. Mileage standards are efficiency issues that 

cost more. There is no question. Most of these things cost more. 

Dr. MOLINA. If the cost increase is sufficiently slow, society can 

certainly adapt. I mean in the long run it will be cheaper for society if you consider the costs of not taking these actions. 

Senator CORZINE. Okay. 

Dr. MOLINA. But I could mention a whole list. There are a series 

of important papers which have a list of 20, 30 things we could do 

now and things that you have to do later with new technologies. 

Senator CORZINE. Okay. Sir, what are your favorite——

Dr. HURRELL. I am going to give—I am not going to waste your 

time by trying to guess at that. My hands are full doing the 

science. My expertise is in the science. I can just make the general 

statement, as I do in my written testimony, that I feel that there 

are a large number of technology options, and I think all nations 

need to work to identify the most cost-effective steps that they can 

take to help contribute to this problem. I am simply not an expert 

in this area. 

Senator CORZINE. Thank you. 

Dr. CICERONE. The reason that I am happy with the answer that 

we need all of these ideas that you just recommended is we will 

end up with a more stable solution. During the first oil crisis of 

1974 and then in 1979, I was disappointed to find out that there 

was no magic bullet, no new energy source, or current one that 

could be exploited that would be cheap, and efficient, and self-reliant. 

Now I am much more convinced that what we face is a few percent here and there. By picking up a couple or a few percent here 

and there, we can make enormous progress. There are markets for 

all of the new technologies and efficiencies, and we will end up 

with a more stable, sustainable situation. So you pick up a few percent from the adoption of solar photovoltaic energy for electricity, 

a few percent from wind, a couple of percent from biomass usage, 

get started on clean coal technology, and carbon sequestration. But 

anybody who thinks we are going to find a way to sock away 25 

million tons of carbon dioxide per day has not looked at the size 

of the problem. 

Clean coal and carbon sequestration can make a dent, but it is 

not going to be the total solution. 

Senator CORZINE. Nuclear power would fit in——

Dr. CICERONE. Nuclear power. I know of a concept that is being 

explored now for a nuclear fusion technique which is being supported totally by private investors. Mostly by private investors. A 

couple of small government grants supporting these people, because the payoff would be so large even though it may not be a 

total solution. 

So a combination of new technologies and improving old ones, inefficiencies, will lead to a dramatic and yet stable solution. But 

there is not a single magic bullet. 

Senator CORZINE. When you say efficiencies, I want to just make 

sure, is mileage standards one of those that you—on automobiles? 

Dr. CICERONE. There is a lot of potential there. 

Sir HOUGHTON. I think there is a great deal, except—just to give 

maybe a view from outside your country, I mean we believe very 

53

much in market mechanisms. Capping and trading is a very powerful thing. We have high hopes of Kyoto, as far as that is concerned. 

There is efficiency, of course, in buildings, efficiency in transport. 

Much, much more efficient transportation. Motorcars and the like. 

And those are all possible, that in a way, they are there. They just 

have to be built and done. 

And the same with buildings. We can cut our—IPCC has said we 

can cut by 50 percent or so in buildings without too much difficulty. 

And we should get on with doing that. It needs incentives to do——

Senator CORZINE. I am going to have to get on and vote. I apologize. I would like to——

Sir HOUGHTON. It needs incentives to do that, and we have to—

and then we have to work closely and generously with the developing countries, particularly China and India, and other such countries to make sure that we really help them to buildup their economies in ways which are friendly to this whole problem of climate 

change. 

And I know the Chinese are very concerned about it, and the impact on their country of climate change. So are the Indians. They 

have some very good climate scientists that are well aware of this. 

They desperately need us to work with them on that. As I say, in 

Europe, and the European Union is going to work as closely as it 

can with these countries to try to help them, again, in a generous 

way, to do things, to buildup their industrial machinery in a way 

which is, as far as possible, carbon free. Thank you. 

Senator ALEXANDER [presiding]. I will ask a question and then 

Senator Murkowski will. 

Let me pursue this line a little bit that was begun by Senator 

Corzine, but first let me ask, most of our new power plants in the 

United States are natural gas plants. Natural gas produces methane, is that correct? 

Sir HOUGHTON. It is methane. 

Senator ALEXANDER. So is making electricity from natural gas 

contributing to global warming and something we ought to limit or 

stop? 

Dr. CICERONE. Yes. In two ways. But it is also more efficient. The 

electrical production compared to the amount of carbon used in 

methane is efficient. We get more efficiency. The typical coal-powered—coal-fired power plant of the past generation had like a 30 

percent efficiency. We can do much better than that now, with 

mixed cycle gas turbines and capturing waste heat, especially with 

natural gas. 

But if the methane, which is the natural gas, is lost before being 

burned, it is a direct greenhouse emission. And, of course, carbon 

dioxide is produced in the burning of the natural gas. So it is not 

a total solution, but the efficiency gain is substantial and can be 

made even better. 

Senator ALEXANDER. Well, let me then go back to the unanimity 

of your recommendations about why there is—that there is global 

warming, and that it is caused in significant part by human activity, and that it is urgent we do something about it within a generation. That is a pretty clear message coming from you. 

I would argue that the Senate Energy Bill that Senator Domenici, and Senator Bingaman, and the rest of us worked on, without 

54

imposing mandates, goes a long way in taking steps to produce low 

carbon or carbon-free electricity, focusing on, first, conservation 

and efficiency, second, on advanced nuclear power, third on coal 

gasification and carbon sequestration, and fourth, on new supplies 

of natural gas, which you have just said is less harmful, because 

it is more efficient. And then there is also support for renewable. 

But what is surprising and disconcerting to me from the scientific community is how the scientific community with a single 

voice can say this is a terrifically urgent problem, it is being caused 

by human activity to a significant extent and we need to deal with 

it in a generation. 

Yet, when we then say, ‘‘Okay. So then what do we do about it,’’ 

you are all over the map and say, ‘‘Well, we need a little here, a 

little there, a little here, a little there.’’ I do not see it, looking at 

it that way. 

I mean the United States of America uses 25 percent of all the 

energy in the world. Now we are not going to put a few solar panels on or build some windmills and solve the problem in the United 

States in a generation. And you have mentioned carbon sequestration as the most politically attractive solution. It would be largescale coal gasification, with carbon sequestration. That solves 15 

problems at once. United States, and China, and India. It solves 

the environmental problems. It is an elegant solution in a scientific 

term, but it has—but we are several years away from there. 

If we were to begin to—we might produce coal gasification very 

quickly, but carbon sequestration is a massive undertaking. And 

we do not quite yet know how to do it. 

So I am working backward, and if we are talking about the next 

generation, I do not see any way in the world for a country as large 

as the United States to reduce the effects of global warming unless 

we are aggressive on conservation and efficiency, first, and aggressive on nuclear power, second. I do not see any way in the world 

that scientifically there is a way to limit global warming in the 

United States unless we do what France is doing. 

Now if that is true, why does not the scientific community say 

that? Because what I always see is let us do a little of this, a little 

of this, let us build windmills, and put on solar panels. That might 

be good for a desert island, but it will not solve global warming in 

the United States of America. 

And I believe you would be more persuasive in persuading the 

Senate and the country that global warming is an urgent issue if 

you would also say, as Senator McCain did and Senator Lieberman 

did when they amended their legislation this year and said we 

want to put mandates on global warming, and we want to incent 

nuclear power, because in this generation, it already produces 70 

percent of all the carbon-free electricity in the United States today. 

And in this generation, other than conservation and efficiency, it 

is the only way to do it. Who would comment on that? 

Dr. CICERONE. I do not think you would find much disagreement 

with that, Senator Alexander. I think Dr. Houghton mentioned earlier his personal concerns about spent fuels and potential——

Senator ALEXANDER. Of course. 

Dr. CICERONE [continuing]. There are those concerns. There is 

the——

55

Senator ALEXANDER. Proliferation and spent fuel are the two 

worries. 

Dr. CICERONE. And we all worry that in the last 20 or 30 years 

we and other countries have not had an aggressive set of activities 

to make nuclear power more dependable and more safe. We wish 

we had. But the numbers are pretty much what you said. The 

United States gets almost 20 percent of its electricity already from 

nuclear energy. It has enormous potential. People just want to see 

it done safely. 

Senator ALEXANDER. And yesterday I met for a few minutes with 

the head of our naval nuclear operation. I mean he runs 103 reactors. 

Dr. CICERONE. Tremendous record of safety. 

Senator ALEXANDER. I think he has an unblemished record of 

safety since the 1950’s in terms of the reactors. And I jokingly once 

suggested to him that what we ought to do in the United States 

is build 20 stripped down aircraft carriers with two 500-watt nuclear reactors and just park them around the coast and plug them 

into the grid. Because that would be 20 more nuclear reactors than 

we have built since the 1970’s. 

At the same time, France is 80 percent nuclear. Japan, who suffered nuclear tragedies, has gone ahead with it. And we are loaning 

$5 billion through the EXIM Bank to help China build 24. And the 

President is working with India to help them do that. And I think 

we should want them to do that, because that will reduce the demand for energy, reducing prices, and it will clean the air, and it 

will help global warming. 

So why does not the scientific community say, ‘‘We see the problems with nuclear power,’’ but if you want to deal with global 

warming in one generation, other than conservation efficiency, nuclear power—it is not a little here and a little there. Nuclear power 

is the only way——

Dr. CICERONE. The big one. 

Senator ALEXANDER [continuing]. To do most of it. 

Sir HOUGHTON. Can I just balance that? I mean I do not disagree 

with the statement you made, but there are two sorts of energy we 

have not mentioned that much about this morning, which I think 

in your country can be very important. 

One is biomass——

Senator ALEXANDER. But, sir, what percent of our total energy 

will biomass—today it is about 1 percent of our total energy production. And you are the one who said that in a generation we 

must deal with this. And what do you think biomass is going to 

produce? 

Sir HOUGHTON. I have seen the program in your country called 

25 by 25, which is for 25 percent of your total energy to come from 

biomass by 2025. 

Senator ALEXANDER. Well, sir, if you believe that, then I do not 

believe what you said earlier about global warming. 

Sir HOUGHTON. Well, I do not necessarily—I am just telling 

you——

Senator ALEXANDER. You undercut your entire credibility when 

you suggest that 25 percent of our energy will be biomass by 2025. 

56

Sir HOUGHTON. I am posing to you a proposal which has been 

made, which is probably too ambitious. And I understand that. But 

I also understand that biomass is important for China, and India, 

and other countries. And that is the important part of the whole 

portfolio. 

We need a portfolio of possibilities, which includes nuclear, which 

includes other things, which includes solar as well. Because you 

have other places where you could——

Senator ALEXANDER. What percent do you think solar will be, 

sir? 

Sir HOUGHTON. Pardon? 

Senator ALEXANDER. What percent of the United States do you 

think solar will be in a generation? You are the one who said it 

is urgent to deal with this in a generation. And today, solar is less 

than 1 percent, even though we spent billions of dollars on it. 

The CHAIRMAN [presiding]. All right. Senator, this is your last 

question, please. 

Senator ALEXANDER. Well, I have—I am trying to interject 

some——

The CHAIRMAN. I understand, but, you know——

Senator ALEXANDER [continuing]. Realism——

The CHAIRMAN. You were gracious to take over. 

[Laughter.] 

Sir HOUGHTON. I am aware of proposals which are being made 

elsewhere in the world for solar to have a very big part in it. And 

I also know the potential in your country for, if you really want to 

do something, doing it fast, doing it well, and doing it efficiently. 

I am not in the position to say exactly what you can do. But I do 

urge you to address a portfolio of possibilities, to weigh them all 

together and what you can do, and come up with a plan for doing 

it. 

And that is what I urge my own government to do in the U.K., 

what I urge the European Union to do. And I just wish this would 

be done in a more responsible and a more genuine strategic manner. 

The CHAIRMAN. Thank you both. 

Senator, thank you. I do not mean to cut you off, but I think 

even though you are generous to take over when we are not here, 

you should not assume that the time consumed by you does not 

count. 

[Laughter.] 

Senator ALEXANDER. I had an opportunity, Mr. Chairman, and I 

took it. 

[Laughter.] 

The CHAIRMAN. You are practical in all respects. 

Senator ALEXANDER. Well done. 

[Laughter.] 

The CHAIRMAN. Now we are going to ask the Senator from Alaska. 

Senator MURKOWSKI. Thank you, Mr. Chairman. I kind of enjoyed that little engagement there. 

I have said repeatedly, I do not need to be converted on whether 

or not we have climate change under way in this country. As I said 

in my very brief statement this morning, I see it in my home State. 

57

I see it with what is happening with the erosion. I see it with what 

is happening in our vegetation that is migrating northward, with 

the insects that are coming on, with the temperatures. So I know 

that something is happening just from a non-scientific person who 

lives there point of view. 

So I have been trying to find what are the answers. Help me 

with the science. And I have been spending the time that I think 

a reasonable person in my State would be doing on this issue. I 

want to know the answers, but I want to know with a certain level 

of certainty what it is that is causing this. So I listened with great 

interest this morning to the conclusion that all four of you have 

reached that it is man’s emissions that are causing the changes 

that I am seeing in my State and the changes that you have referred to throughout the world. 

The scientific modeling out there is amazing. And I have had an 

opportunity to see some of it, talk to the scientists about how it 

works, and what more we need to do. Why can we not understand 

and differentiate then what effect the human variables, whether it 

is the solar changes, or the current changes? What portion can we 

extract out of this equation and say this is manmade versus this 

is what Mother Nature is doing? 

And if we cannot, why can’t we? And will we ever be able to 

make that distinction, that differentiation? Now I am not going to 

sit here and tell you from a policy perspective, if you come back 

and tell me that 5 percent is man-induced and the other ninetyfive percent is human variable, that we are going to direct our policy that way. 

But are we to the point of understanding from the scientific perspective how we can isolate this? 

Dr. Hurrell? 

Dr. HURRELL. I will attempt to answer this question probably in 

two parts. The first speaking to where the technology stands and 

our ability to differentiate between the human versus more natural 

origins of the climate change and climate variability. 

And, of course, one of the main tools that we have for doing this 

are the state-of-the-art models of the coupled climate system. And 

in recent years, I think very credible arguments can be made that 

these models have become very useful in tackling that specific 

issue. 

If you look at the models now, they are able to replicate, for instance, the most important characteristics of the observed changes 

in global temperature over the last 100 years. Since they can do 

that, we can then begin to break down which forces have contributed to the climate change in terms of the increases in temperature 

that we have observed. If you do those experiments, you find that 

natural variations and particular changes in solar luminosity 

played a key role in contributing to the warming during the early 

part of the 20th century. 

But the temperature changes that we have seen in the last several decades, those same simulations with only the so-called natural forces and climate prescribed, do not produce any significant 

change in temperature over the last several decades. 

When you then give the models the information about the observed buildup of greenhouse gases in the atmosphere, they now 

58

produce the increase in temperature that has been observed. So 

this is very strong evidence, I think, from these very credible, although not perfect, but very credible models that much of the climate change over the last several decades is being driven by the 

buildup of greenhouse gases, and sulfate aerosols and the like in 

the atmosphere. 

Senator MURKOWSKI. Can you define ‘‘that much’’? 

Dr. HURRELL. I would say based on the climate model simulations that are contributing to the next assessment of the IPCC that 

nearly all of the warming is attributable to that in recent decades. 

Senator MURKOWSKI. How do you respond then to those—you 

have scientists all over the board, like economists, like lawyers, 

like politicians. You ask them all, they are all going to have their 

own theory. 

I had an opportunity to speak with a climatologist out of Oregon, 

who is indicating that in his opinion it is the cyclic increase in the 

solar radiation and/or the changes in the North Atlantic or the Pacific Decadal Oscillations that affect the currents. 

Dr. HURRELL. Yes. 

Senator MURKOWSKI. So you are saying all of it and he is saying——

Dr. HURRELL. No. 

Senator MURKOWSKI [continuing]. Hey, it is all—it is the natural 

variables. 

Dr. HURRELL. Thank you for the opportunity to expand. That 

gets to the second point of my question. The first point was really 

addressing the very large-scale temperature changes. On a regional 

level and a local level you will often hear scientists say that there 

is more uncertainty in that. And that is because one of the outstanding scientific questions is how will the so-called natural 

modes of the climate system—you mentioned the Pacific Decadal 

Oscillation, or El Nin ̃ o, the ENSO events in the tropical Pacific, 

which have a worldwide impact on climate and weather. 

How will those natural phenomena be affected as a result of 

human activities? And there is much less certainty on that topic. 

There are very open scientific issues. So when you look at your 

State of Alaska, for instance, you have seen warming there that is 

very significant. 

You have noted that you can observe the changes with your own 

eye. And, in fact, a very key player in Alaskan climate is the socalled Pacific Decadal Oscillation. So there are natural variations 

in climate that are occurring, that have always occurred in the 

past. But imposed upon that then is the human influence. 

But it becomes much more difficult to attribute at a regional or 

a local level. For instance, the warming in the Arctic in recent decades. Just how much of that is due specifically in a specific region 

to the buildup of greenhouse gases. Because a fundamental scientific question is, how do we expect the so-called modes of variability of the climate system to be affected? 

Now it is a complicated issue, because in—if I can go on just one 

more moment. Sir John was speaking about the Atlantic climate. 

And one of the—the key driver of Atlantic climate, for instance, is 

something called the North Atlantic Oscillation. It is in some ways 

analogous to the impact that the PDO has on climate in Alaska. 

59

And scientists have known for a long time that this is a so-called 

natural mode of climate variability. It is significant year to year, 

and maybe even decade to decade variations. But there is research 

that indicates that the amplitude and the phase of this phenomena, 

which has been behaving differently in recent decades, can be related to the warming of the tropical oceans. 

When you look at the warming of the tropical oceans, in particular, for instance, the Indian Ocean, there is very strong scientific evidence to suggest that a big component of that warming 

of the oceans is, indeed, anthropogenically driven by the buildup of 

greenhouse gases in the atmosphere. 

So you have the warming of the tropical oceans, which are being 

driven, in part, by the increased greenhouse gas concentrations in 

the atmosphere that are affecting the behavior of this mode of variability in the system thousands of miles away in the North Atlantic, and are contributing to some of the unusual behavior of this 

North Atlantic oscillation. 

Senator MURKOWSKI. Just so that I am clear that I understand 

your position, you believe that much, if not all, of what we are seeing that is contributing to climate change, global warming, is 

caused by man-induced emissions. We may be seeing some regional 

impact that is perhaps not quite in sync with what we are seeing 

globally, that is being impacted by the overall global changes. 

Dr. HURRELL. Regional climate, if you will, is affected by the 

weather patterns, the jet streams, and the like. And they are sort 

of organized in some coherent fashion in the climate system by 

these large-scale modes of variability. You mentioned the Pacific 

Decadal Oscillation. 

The mechanisms for that can be related to natural couplings in 

the atmosphere ocean system. Exactly how those couplings are affected by global warming is still a major research issue. So that is 

what I am trying to separate out, that we know that on a global 

scale, and we can begin to quantify, I believe, with global climate 

models, what the human-induced contribution to that overall global 

warming is. On a local and a regional scale, it is much more difficult to attribute any specific change to the buildup of greenhouse 

gases in the atmosphere. 

Senator MURKOWSKI. I think if you could show this panel here 

and other policymakers that, in fact, with the statistical modeling, 

almost entirely we are seeing global climate change as it relates to 

or caused from manmade emissions, I think it might be easier for 

us to make a determination in terms of where we go with policy. 

But when we get statements like we believe that much of it is 

caused by, that makes it tougher. I think we are looking for a little 

more certainty. 

The one thing that I concluded, sitting down with a group of scientists that were involved with the Arctic climate impact assessment report, was that they all agreed something was happening, 

but they could not determine exactly where it was coming from. So 

your assistance on that would help us. 

Mr. Chairman, I could go on all morning, but I know we have 

another panel. Thank you. 

The CHAIRMAN. Thank you very much. Did you feel compelled to 

say something? 

60

Dr. HURRELL. I was simply going to add that I would be more 

than happy to provide the committee with some of the evidence 

from the climate model simulations that I am referring to, to show 

that in a global mean sense, nearly all of the warming in recent 

decades can be attributed to the buildup of greenhouse gases. 

Sir HOUGHTON. May I just add briefly, that is on the global scale 

we have this confidence that Dr. Hurrell has been talking about, 

but the regional scale, there is a lot of natural variability. But that 

natural variability is all being affected by the global scale, by all 

the global scale changes due to human activity. 

But because of the degree of that variability, any given event, we 

cannot say that event is caused by human-induced climate change, 

because we have had lots of the variabilities so large. There is one 

event which I mentioned, which is the heat wave in Europe, which 

is so far outside. It is five standard deviations away. So far away 

from natural variability, it could not conceivably have come from 

natural variability. 

But it is most other single events—but it is when we see the way 

in which the number of events and their average intensity, we can 

see the trends. And those trends are now occurring. We are seeing 

more floods, and more droughts, and more storms in general this 

end of the century that we had in the middle of the century. And 

the models can actually predict reasonably well or project quite 

well what will happen by the year 2050, for instance, is what these 

good models show, that suggest in Europe we are going to have a 

risk of flooding which is five times greater in 2050 than it is now. 

So the 50-year flood will become the 10-year flood, and so on. 

So we can project into the future, but actually identifying anything now, because of this great natural variability of climate, 

which is part of the climate characteristic, is made very difficult. 

The CHAIRMAN. Thank you very much. Now I guess you noticed 

that I have not participated, and that is very unusual. But I 

thought it best to do it the way I did it. I am not sure what is going 

to happen for the rest of the day to these wonderful following witnesses, but I am going to try to put you on and see what happens. 

We both have something scheduled, but let us see what happens. 

First, let me start, Dr. Cicerone, you indicated that we have evidence over a 400,000-year period that carbon dioxide in the atmosphere had various high and low levels, and you found that out in 

a typical way that is now determined to be accurate. 

Just so we will know, where did the pollutant that contributed 

then come from? Certainly, it was not what we are doing now. That 

was not even a civilization. So where did it come from? 

Dr. CICERONE. In that range that I spoke of, the last couple of 

glacial cycles, 400,000 years, the carbon dioxide amounts went between about 180 and 280 parts per million, and today we are about 

380. 

The CHAIRMAN. Okay. 

Dr. CICERONE. So well outside the natural range. But nonetheless, those were big changes, as you say. 

The CHAIRMAN. Yes. 

Dr. CICERONE. The decomposition of organic material in the soils 

was going on over geological time scales, and the exchange of carbon dioxide with the oceans. No one can completely tell why the 

61

carbon dioxide amounts changed. It looks as if the carbon dioxide 

changed partly in response to changing climate and partly leading 

the change in climate over the past two ice ages. 

The data are about as firm as we are going to get. They are real 

measurements from dated ice cores. So it is exchange of carbon 

with the organic matter in soils and exchange of carbon dioxide 

with the oceans, the stuff moving back and forth, up and down. 

The CHAIRMAN. But the fact that it existed then and we did not 

have a source of pollutants that we are now trying to control is not 

a reason to draw any inferences that the information about the current pollutants is not right. 

Dr. CICERONE. Correct. First of all, we are way outside the range 

of natural variability, the 180 to 280. And second, we have isotopic 

data that tell us that the carbon dioxide buildup in today’s atmosphere is mostly due to fossil fuel consumption. Maybe 80 percent. 

The CHAIRMAN. My second point. It has been stated by one of 

you, I think it was you, Sir John, that while China is now and will 

become, unless some big changes occur, a more major contributor 

to the CO2 that we are worried about, and something was said that 

they are looking for us to do something, it is very interesting, and 

you should know that we are in the same boat and we have people 

tell us, we are not going to proceed until they do something. 

Now you have answered that by saying you are the leaders. If 

you lead, they will follow. I want to suggest to you that that is not 

an easy nut to sell up here. Okay? So I would suggest that we be 

focusing on how are we doing something that they should recognize 

that we are doing. 

And so I want to tell you something about the energy bill that 

we produced. We produced an energy bill that essentially, for our 

new policy, could have been called a clean energy bill, instead of 

just an energy policy. Because everywhere in the bill the emphasis 

is on producing energy that is clean. And not only clean, but we 

have literally used the words, greenhouse gas clean. The whole section on incentives, which is one that Senator Bingaman and I take 

most pride in, which is going to permit the Secretary of Energy to 

finance, and we hope we will get it in—the House has not said yes 

yet. But we are saying we do not get a bill unless it is in there—

actually permits the funding in the next few years of facilities that 

are aimed at reducing greenhouse gases. 

And it is going to cost a lot of money, but the way we have done 

it, it is not going to cost our treasury so much, because it is guaranteed loans where the applicant pays the risk. The risk insurance 

is paid by them. It may be 10 percent. It may be 5. And that whole 

section is designed to employ innovative clean energy, and it is actually said that avoid, or reduce, or sequester air pollutants or 

other emissions of greenhouse gases. 

Now if we do that, we pass that law, and we get started on it, 

is that not evidence that we are doing something? Or is that not 

the kind of evidence that China or anybody else would be waiting 

for? Now I just state that—I just throw you that out. I do not need 

an answer. It seems to me we are going to do something. 

Now my last observation, or third observation is this. You heard 

almost everyone here say with varying degrees that there is a problem. But I think you also gather that the question what do we do 

62

about it, and how, remains a very live subject. And while you are 

not the experts on that, it does appear that you have to be involved 

in that, and what do we do about it. And I submit that the distinguished Senator from Tennessee, Sir John, was on the right track 

in talking about practical things. Real things. Not only achievable 

things. Achievable things that do not amount to anything I do not 

put in the class of being very relevant. 

So when people say we can do this, and we can do that, we have 

to ask the question, just what will that amount to. And I submit 

to you that the United States will make a giant stride in nuclear 

power, and you will see it. I mean it will happen. There will be a 

nuclear power plant started in the United States within the next 

3 years, in my opinion. Sounds crazy, does it not? But I think it 

will happen. And that is because of this bill and because of what 

is already happening. 

Now having said that, I just make the point that we need to 

come up with a plan that gives us a period of time to pursue those 

technologies with vigor, so that we are moving toward achievement 

and that at some point, if we do not, we do something. 

Now the reason Senator Bingaman and I have been drawn to the 

National Commission on Energy Policy, that they say would end 

the energy stalemate. It recommends sort of what I am saying, that 

for X number of years we pursue the voluntary approach, and we 

want to extend that a little bit to be more consistent with the 

President’s goals, and then we would trigger some things. And then 

I want to urge that you study that with us, look at it. And I will 

ask you about it. 

The last point is, I do not think the issue is whether we have 

a major international problem. I think the question is how do we 

solve it. And I think we have too many people talking as if it is 

simple. Oh, just cut emissions 10 percent, and come up with a bill 

that says we should do that. 

Well, I hope you understand that I have heard nothing like that 

from your mouths today. And I thank you very much for your calm 

expertise here today. And we need more of that, because this country lives on energy. Whether anybody wants to think we are hogs 

or whatever, we live on energy. And we are successful because of 

the use of energy. And we cannot put ourselves back in an era 

when we say we are not using energy without devastating something, right? That is pretty simple. 

In fact, I was going to say, Dr. Molina, you do not have to be a 

Nobel winner to know that, right? 

Dr. MOLINA. Right. 

The CHAIRMAN. You know a lot more than that. That is very simple. So I am just going to leave it to you for a couple of observations from each of you about what I have said. I am looking for a 

solution, but I am not going to join the crowd that thinks it is simple. I am not going to join the crowd that thinks Kyoto was a solution. I hate to tell you, it is not a solution. It would not be achieved. 

And America, some people think we are being—the President is 

being stubborn, but I remind you that the U.S. Senate did not have 

one affirmative vote to support Kyoto when we voted on it. And 

they keep blaming the President. 

63

Nobody voted to give the President the authority to sign that 

treaty. So we have to talk about something else. Everybody keeps 

saying what about it. Well, we have to come up with something 

else that we can talk about. 

Having said that, I am out of time, but usually that means you 

can use up some time, because mine does not count against you. 

So would any of you like to comment in any respect. 

Dr. Molina? 

Dr. MOLINA. Yes. Senator Domenici, as you know I am a member 

of the National Commission of Energy Policy, so I very much endorse what you just have stated. And I repeat once more, we as scientists, of course, can state what the severity of the problem is, but 

we do not have the solution. We have to work with the rest of society to do that. And that is why it makes sense to have government 

intervention, to have a strong signal that something is to be done. 

It will not happen spontaneously. 

We do need enough resources for technology, including clean nuclear energy. So I think you are very much on the right track. We 

do work with our economist colleagues. And I think there are very 

sensible solutions. I agree with you, different than Kyoto, but the 

National Commission on Energy Policy recommendations repeated 

one very good example that I understand you are looking at very 

carefully, which is how to go about it without having a negative 

economic influence on the United States. 

Dr. HURRELL. I do not have too much to add. I would reinforce 

the comments that Dr. Molina made, and I agree with what you 

are saying, Senator Domenici. I am very heartened to hear from 

this committee that they feel as though it is not a question of 

whether or not this is a problem, but rather how to go about addressing it. That is not my area of expertise. 

But I have been biting my tongue a bit, because my father-inlaw is a nuclear engineer, and I would simply say that I do think 

that nuclear energy is a very, very real and viable way to make a 

major contribution to this problem. 

Dr. CICERONE. Senator Domenici, as you know, the National 

Academies of Sciences and Engineering are at your disposal. We 

exist to help the Government in performing evaluations and recommendations. And in this challenge, we will be at your service. 

The CHAIRMAN. Sir John. 

Sir HOUGHTON. Just to mention, Kyoto finishes in 2012. Kyoto is 

not a long-term solution. Kyoto was never meant to be a long-term 

solution. Kyoto is a beginning. And Kyoto is a beginning that 

brings nations together to do things. It is also based on marketbased techniques and measures. And I notice—and we hope those 

will work. And they will have some effect. 

But we have to look now, we have to begin to look now at the 

longer term. Beyond Kyoto. Whatever happens there, in order to 

come up with what you say in your sense of the Senate’s resolution, 

which you passed, you should enact a comprehensive and effective 

national program of mandated market-based limits and incentives 

on emissions of greenhouse gases that slow, stop, and reverse the 

growth of such emissions at a rate and in a manner, and so on. 

I mean that is a marvelous statement. That is exactly what we 

believe should happen. It means that governments, and industries, 

64

and local governments, and everybody should get together to work 

out a program, a timed program of how you can proceed with this. 

But it is also—it has to encourage comparable action by other nations, for major trading partners, and so on, and key contributors 

to global issues. 

And so there is an international part to it, very important international part to it. And if I might again repeat what I said at the 

start, coming as I do from outside your country, and listening, as 

I do, to what the rest of the world says, to a large degree the rest 

of the world is looking at you in the United States and saying, 

‘‘Please, United States, you are a big contributor to, of course, the 

problem of global warming because of your emissions. You have 

this enormous industrial capacity. You have this enormous desire 

to lead in the world. And please exercise that leadership, which 

will enable the rest of the world to come along with you to help to 

solve this problem.’’

The CHAIRMAN. Well, for myself, I would just say thank you for 

the compliment. I wish you would follow in some other areas, too, 

but it seems to be that we have difficulty getting follow-ship in 

some other areas of endeavors that are important to us. I am just 

kidding. Just kidding. 

Let us take a look at—do you have anything further, Senator 

Bingaman, of these witnesses? 

Senator BINGAMAN. No, Mr. Chairman. 

The CHAIRMAN. Would you join me in thanking them? 

Senator BINGAMAN. I think the testimony has been excellent, and 

I very much appreciate the witnesses and particularly, Sir John, 

thank you for coming all this distance. 

Sir HOUGHTON. Thank you. 

The CHAIRMAN. We appreciate it. Thank you all. Thanks for 

much. You are excused. 

Would the other witnesses join with me and let me talk to them 

a minute? You can sit where you are or come up and let us just 

chat a bit. Do I understand correctly that each of you, let us say, 

Dr. Montgomery, do I understand that you are from around here, 

Doctor? 

Dr. MONTGOMERY. Yes. 

The CHAIRMAN. The region. How convenient would it be if we set 

you up again? 

Dr. MONTGOMERY. We are all open, sir. 

The CHAIRMAN. Would that be all right, Mr. Grumet? 

Mr. GRUMET. Around the corner, sir. Can be here any time. 

The CHAIRMAN. Okay. Dr. Morgenstern? 

Dr. MORGENSTERN. Local. 

The CHAIRMAN. Guy Caruso? Local? Okay, with the Energy Information Agency. You have been doing great work, let me say. We 

greatly and very much appreciate it. 

Here is what we are going to do. Rather than try to package this 

in and shove it into a small time, we are going to reschedule it 

when we have more time. And you will be first up, the next panel 

we have. Is that satisfactory? Maybe in the meantime, you have 

heard a little from us. You might——

Panelist: Improve the quality of our testimony. 

The CHAIRMAN. Yes. 

65

[Laughter.] 

The CHAIRMAN. Well, answer some—you know what we are 

thinking about. Yes. Thank you very much. Let me announce that. 

Thank you. 

All right. What we have decided to do, since these four witnesses 

are from the immediate area, they have expressed a willingness to 

come back on reasonably short notice, and we will attempt to set 

up another hearing where they will be first. There will be another 

panel with them that will address the issues that you have from 

another vantage point. And with that, I thank everybody, including 

the members of the press. We stand in adjournment. 

[Whereupon, at 12:03 p.m., the hearing was adjourned, to be reconvened on September 20, 2005.] 

(67)

CLIMATE CHANGE 

TUESDAY, SEPTEMBER 20, 2005

U.S. SENATE, COMMITTEE ON ENERGY AND NATURAL RESOURCES, Washington, DC. 

The committee met, pursuant to notice, at 10:10 a.m. in room 

SD–366, Dirksen Senate Office Building, Hon. Pete V. Domenici, 

chairman, presiding. 

OPENING STATEMENT OF HON. PETE V. DOMENICI,

U.S. SENATOR FROM NEW MEXICO 

The CHAIRMAN. Hello, everybody. Good morning, witnesses. Senators, good to be with all of you. 

I want to thank all of you for coming here from your busy schedules. As everybody knows, this is a continuation of the hearings 

that the committee held on July 21. Due to the length of the questions and the answers, and the press of the Senate business, the 

committee was unable to hear from you. We heard only the first 

panel. For that, we apologize. Glad we were able to set it up again 

today. 

Today we will hear from four witnesses on the topic of mandatory carbon controls and the impact of such. Now, there could be 

a lot of other questions asked of you, but I think—and we cannot 

hold Senators to anything, nor you to your answers, but that is 

what we would like to focus on, because the previous discussion 

covered the other subject that was important. So the impact of 

these controls that we are speaking of, what that might be on the 

economy and how effective the controls might be in reducing carbon 

emissions that are generated in the United States. 

I should note that the Deputy EIA Administrator, Howard 

Gruenspecht, is appearing instead of Administrator Caruso and Dr. 

Anne Smith is appearing in place of David Montgomery. That is 

just a coincidence of scheduling and we greatly appreciate your 

stepping in and we know your testimony will be the equivalent of 

whom you replace. 

I am pleased that the committee is continuing the discussion of 

this serious issue. It is clear that something is happening with the 

Earth’s climate and I am aware that many in the scientific community are warning us that something needs to be done. I am also 

aware that there are equally-qualified members of the scientific 

community who do not share those views. Nevertheless, I believe 

that it is prudent to heed the warnings that we are hearing and 

begin to find ways of alleviating the human contribution to this 

problem that is being presented to us. 

68

As I said in the July 21 portion of the hearing, what, who, how 

and when are the questions that the hearing and subsequent hearings will help us answer. With this hearing we are continuing to 

search for answers on meaningful economically feasible activities 

that will produce real reductions in greenhouse gas emissions. 

It is clear to me that developing a system of mandatory controls 

on carbon emissions could be a daunting task. In fact, it is. Controls must be effective. They must produce positive reductions. The 

cost should have the least possible negative effect and any burdens 

must be as equal as possible, spread out among those affected. 

Now, some say that does not matter, and they have said, when 

we were arguing on the floor, at least someone did, that we were 

too concerned about fairness. But, actually, fairness is important in 

itself, it is also important from the standpoint of Senators and voters and people willing to do things. Many, including the NCEP, 

suggest that the answer lies in a system assigning greenhouse gas 

emitters emission allowances that could be sold or traded. The 

NCEP has also suggested that a monetary value of the allowances 

be capped at $7 a ton of carbon, rising slowly over 10 years. If 

needed, emitters could purchase allowances from the government. 

Proceeds can be used to finance research and development on new 

or low-carbon energy technologies. I hope I have not misstated the 

position. I think that is correct. 

These are interesting ideas, but designing an effective and equitable allowance mechanism is likely to be very difficult, and I think 

you yourselves, your group, is acknowledging that. I believe such 

allocation mechanisms might be constructed, but I do not think we 

are there yet. I would be glad to hear from you on that score. I 

guess, not to be trite, but I think the devil is in the details in that 

regard. 

So let us proceed. I yield now to Senator Bingaman. Thank you 

so much, Senator Bingaman, for helping me move this along and 

for your interest. 

[The prepared statements of Senators Akaka and Corzine follow:]

PREPARED STATEMENT OF HON. DANIEL K. AKAKA, U.S. SENATOR FROM HAWAII

Mr. Chairman, thank you for holding this hearing on the economics of global climate change. First of all, I want to thank ranking member Jeff Bingaman, and you, 

Mr. Chairman, for your leadership in the Senate’s passing the first resolution in 

support of mandatory control of carbon dioxide during debate on the Senate’s energy 

bill. Included in that resolution was the idea that it should be done in a way that 

does not hurt the economy. I am very interested in how to do that and I have some 

questions for the witnesses. 

Mr. Chairman, this hearing is extremely timely. In the aftermath of the devastation wrought by Hurricane Katrina, we must consider the economics of NOT acting 

with respect to global climate change. 

This is something I have said many times before, but now we have a tragic case. 

Estimates to rejuvenate the Gulf Coast and to repair New Orleans are in the hundreds of billions of dollars, and climbing. The cost to human life and well-being can 

never be rectified. 

It was known that New Orleans was vulnerable, that it is below sea level, and 

that levees could potentially breach. It is also widely accepted that global warming 

will bring stronger storms, if not more frequent. 

The recent article in Science, by Dr. Peter Webster, links greater hurricane intensity with warmer sea surface temperatures. This is like fueling hurricanes with 

warmer sea temperatures. This is a devastating thought for all people in low-lying 

areas such as the Gulf of Mexico. Areas around the Mississippi delta in Louisiana 

are already sinking, even as world-wide sea levels are on the rise. That makes it a 

triple whammy for Louisiana. 

69

My view, with Hawaii’s vulnerability in mind, is that our investment in curtailing 

the causes of global warming, and our nation’s leadership in convincing other nations such as China to reduce carbon emission, are critically important for the future. When we discuss economics of carbon control, I have long said that we must 

weigh the costs of inaction as well as the costs of action. Hurricane Katrina is just 

the first of these wake-up calls. 

Thank you, Mr. Chairman, I look forward to the testimony of the witnesses. 

PREPARED STATEMENT OF HON. JON S. CORZINE, U.S. SENATOR FROM NEW JERSEY

Mr. Chairman, I would first like to thank you for holding this hearing on the important issue of climate change. Senator Bingaman, thank you, also, for your leadership and advocacy of smart, effective climate change policies. 

The consensus among the worldwide scientific community is that the burning of 

fossil fuels is linked to global warming, and global warming threatens our environment, our health, and our future. It may even be linked to the recent increase in 

hurricane intensity, and the accompanying dangers. 

I strongly supported Senator Bingaman’s amendment to the Energy bill proclaiming that the U.S. Senate should take mandatory action on climate change, and 

confirming the Senate’s objective to seriously consider climate change proposals. 

While this amendment passed the Senate on a bipartisan basis on June 22 of this 

year, it is a small step on a much larger journey that requires a much greater sense 

of urgency. Hearings like this one continue to raise awareness of the dangers of 

global climate change. It is my hope that the words spoken today will translate into 

comprehensive policies that effectively address global warming, and that we will see 

action soon. 

The overwhelming scientific consensus is that average global temperatures are 

rising. Though there are natural fluctuations in average global temperatures from 

year to year and even decade to decade, scientists believe that the rise in temperature we have seen in the later part of the 20th century is due to human factors. 

Dr. Ralph Cicerone, who was recently hired to head the National Academy of 

Sciences, asserts that global warming is caused primarily by humans, stating that, 

‘‘nearly all climate scientists agree,’’ with this viewpoint. The NAS was specifically 

chartered by Congress to advise the government on scientific matters. It would be 

foolish to ignore their findings. 

Many scientists believe we are already witnessing the effects of global climate 

change in the form of the recent increase in the intensity and frequency of hurricanes. Dr. Kerry Emanuel, an atmospheric expert and MIT professor, believes the 

higher the temperature of the sea surface, the more intense and greater the duration of hurricanes. In short, scientists believe that global climate change creates meteorological factors conducive to the creation and durability of strong storms. With 

the aftermath of Hurricane Katrina still fresh in our minds, this consensus should 

take on an especially strong meaning. If indeed we can create a unified climate 

change policy that would effectively eliminate or mitigate the effects of rising sea 

temperatures, we should unhesitatingly do so. 

My state of New Jersey, though not as susceptible to hurricanes as the Gulf coast, 

still sees its fair share of storms during hurricane season. When storms approach 

New Jersey, we pile sandbags, put plywood up on the windows, and stock up on supplies, much like those in New Orleans did. Such preparations go a long way in attempting to lessen the effects of strong storms. If we can do the same in Congress 

by passing adequate and meaningful legislation that helps buffer severe weather, 

don’t we owe it to our constituents to do so? 

Global warming threatens our environment, our communities and our way of life. 

It can have a severe economic impact on communities and individuals. We have already seen the devastating economic cost of Katrina. Not only has a billion dollar 

tourism industry been decimated, but rebuilding an entire metropolis will cost tens 

of billions of dollars in federal spending. My state, along with all others on the Atlantic coast, is also susceptible to catastrophic damage caused by seasonal storms. 

If our beaches are threatened, and our coastline damaged, New Jersey will see an 

economic impact of terrible proportions. Our second largest industry, tourism, simply will disappear without the draw of the Jersey shore. As Katrina has shown all 

too tragically, every coastal area that we hold dear is at risk of losing a huge part 

of their states’ economies. 

I have long been a proponent of legislation that would counter this problem and 

encourage reductions of greenhouse gas emissions. In the last two Congresses, I secured language in the Senate energy bills creating a greenhouse gas registry. The 

70

greenhouse gas registry would have been an important first step in confronting climate changes, and I am committed to continuing to fight for this approach. 

And of course, I have been clear about my support for stricter CAFE standards, 

which I hope, in the wake of Hurricane Katrina, my colleagues will see as just the 

start of a comprehensive, thoughtful policy to effectively address climate change. 

Again, I thank the Chairman and Ranking Member for allowing this Committee 

the chance to hear from these witnesses before us about this crucial topic. I look 

forward to their testimonies.

STATEMENT OF HON. JEFF BINGAMAN, U.S. SENATOR

FROM NEW MEXICO 

Senator BINGAMAN. Well, thank you very much, Mr. Chairman, 

for reconvening this hearing on climate change and global warming 

issues. Clearly there are a tremendous number of important issues 

competing for attention here in the Congress at this time in our 

Nation’s history, and I think it is a tribute to you that you are willing to commit some committee time to continue to look at this issue 

and see if there is a path forward that we can agree upon. 

I would just make three very brief points. First, I am persuaded 

that there is a broad scientific consensus that links climate change 

to manmade emissions. There are clearly uncertainties about how 

the climate is going to change, about what impacts it will have, and 

various other aspects of the issue. But I believe it makes sense to 

begin now to hedge against the negative risks involved with climate change and I hope we are able to do that. 

Second, I just make the point that in looking at what the effect 

of any kind of a system of emissions controls might have on the 

economy, we also need to recognize the effect of inaction on the 

economy. I do not think that we can ignore the fact that changes 

are expected, adverse changes in our economy, if we pursue a path 

of inaction. I think that that is an important issue to have discussed. 

The third and final issue is that out of this hearing and others 

that you may choose to schedule, I hope we can get some consensus 

on a way forward. Obviously, this is an extremely interesting issue 

and one that has had an enormous amount of study. Our contribution, if we are able to make a contribution to the debate, is going 

to be in actually getting agreement on a course of action, and that 

is what I hope very much this hearing will help us achieve. 

Thank you very much. 

The CHAIRMAN. Thank you. 

Does any Senator feel like they should speak at this point? We 

are going to have plenty of time. Why do we not do this? Any Senator who would like to can speak for up to 5 minutes. 

Senator. 

STATEMENT OF HON. CRAIG THOMAS, U.S. SENATOR

FROM WYOMING 

Senator THOMAS. I am frankly looking forward to your testimony, 

and thank you for having this. I just note we know that we are facing several items here at the same time. We are looking at energy, 

how we are going to supply energy. So I hope that you will kind 

of orient toward policy directions. We can get wrapped up in numbers, but how are we going to balance the things that we need to 

have energy and to do it in an environmentally sound way? 

71

* The release can be found in the appendix. 

So we look forward to hearing from you. 

The CHAIRMAN. Thank you. 

Senator Feinstein. 

STATEMENT OF HON. DIANNE FEINSTEIN, U.S. SENATOR

FROM CALIFORNIA 

Senator FEINSTEIN. I really want to thank you, Mr. Chairman, 

for having an open mind on this. I think it is really important. I 

think the situation is changing rather dramatically. 

I would like to put in the record a release from the Georgia Institute of Technology and read one quote.* They have just done a 

study on hurricanes and, quote: ‘‘What we found was rather astonishing. In the 1970’s there was an average of ten category 4 and 

5 hurricanes per year globally. Since 1990 the number of category 

4 and 5 hurricanes has almost doubled, averaging 18 per year globally.’’

So the bottom line is, although there are not more hurricanes, 

they are much more intense. I spent a day at the Scripps Institute 

of Oceanography a while back and what they said global warming 

would do is bring on essentially more erratic weather patterns, 

that when it rains the drops would get bigger and we would be subject to much more forceful weather conditions. It looks to me as if 

this is beginning to happen. So I think the ability of this committee, if it is not our SUV loophole closer, if it is not McCainLieberman, I think we really do have to come up with some system 

that will make a difference in reducing global warming gases in the 

atmosphere. 

So thank you very much. 

The CHAIRMAN. Anybody else on this side? 

STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR

FROM ALASKA 

Senator MURKOWSKI. Mr. Chairman, the only thing I will say, 

you reminded us at the last hearing. You said it is not really so 

much the question of whether or not there is a serious problem, but 

what do we do about it. That is why we are here today, to listen 

to some of those who do have some specifics. I would agree with 

Senator Thomas. I would hope we would be able to get into a discussion as to how we actually could make something work. So I appreciate you calling this today. 

The CHAIRMAN. Well, I am compelled, Senator Feinstein, to respond to your statement. I was very reluctant, in light of Katrina, 

to call this meeting because I do not think—I thought somebody 

would come up with the idea that could be quoted all over the 

world that Katrina was in some way related to global warming. I 

have heard one of the best experts in the world on television saying 

that that is nuts, and I think it is enough for the English to be 

blaming us and saying we deserve Katrina because we did not sign 

the Kyoto Agreement, which is also absurd, than to get that spread 

across here. 

So I have great respect for you and I thank you for what you said 

about my calling the meeting, but I do not think—if we are going 

72

to get off on that, we will call a couple of witnesses in the next few 

days on hurricanes and I think we will find that certainly that is 

not the consensus opinion. 

Senator FEINSTEIN. All I did was quote from a study, Mr. Chairman. 

The CHAIRMAN. I understand. Well, I could have had a study, I 

could have two of them, saying—in fact, I might dig them up and 

make sure the press gets them. 

Having said that, let us proceed. We will take the Federal witness first. 

STATEMENT OF HOWARD GRUENSPECHT, PH.D., DEPUTY

ADMINISTRATOR, ENERGY INFORMATION ADMINISTRATION, 

DEPARTMENT OF ENERGY 

Dr. GRUENSPECHT. Thank you, Mr. Chairman, Senator Bingaman, and members of the committee. I guess with all the discussion of baseball at last week’s hearings I would like to start, as you 

have indicated, by noting that I am pinch-hitting here for Guy Caruso, who was in the on-deck circle in July when the hearing was 

postponed, but is traveling out of town today. I know he would 

have wanted to be here. 

I appreciate the opportunity to appear before you today to discuss the Energy Information Administration’s recent analysis of 

policies to reduce greenhouse gas emissions and energy use. EIA is 

the independent statistical and analytical agency in the Department of Energy. We provide data and analysis to assist policymakers and inform energy markets, but we do not promote, formulate, or take positions on policy issues. 

At the request of Senator Bingaman, EIA recently analyzed the 

impacts on energy markets and the economy that would result 

from recommendations contained in the December 2004 report 

issued by the National Commission on Energy Policy; they are represented here and you will hear from them. That analysis and my 

testimony today focus on a case that includes all of the recommendations made by the Commission that EIA was able to analyze in its modeling system. But we also looked at several of the 

recommendations separately, including the proposed cap-and-trade 

program, and I will discuss that as well. 

We found that three policies—the cap-and-trade program, which 

is linked to a target for reducing greenhouse gas emissions intensity beginning in 2010; tighter fuel economy standards for cars and 

light trucks; and new building and appliance efficiency standards—

were projected to have the most significant impact on energy use 

and emissions of the recommendations made by the Commission. 

Overall, the policies we modeled were projected to reduce total 

energy consumption in 2025 by 5 percent and fossil energy use in 

2025 by 7 percent, both relative to the reference case in our Annual 

Energy Outlook 2005. However, even with those reductions, U.S. 

consumption of oil, natural gas and coal all grow from today’s levels by 2025. 

Turning briefly to the individual fuels, the policies in the NCEP 

package are projected to reduce oil demand by 7 percent in 2025, 

with a slight decrease in import dependence. As shown in figure 1 

of the written testimony, almost all of the reduction in oil demand 

73

results from more stringent fuel economy standards. The cap-andtrade program alone has only a small impact. 

Second, even though the cap-and-trade program itself would tend 

to increase the use of natural gas, the NCEP policies taken together are projected to reduce natural gas use slightly by 2025. 

That is because the NCEP proposals for building standards and 

some of the technology programs—incentives in the programs—

lower natural gas use for space heating and electric generation, 

and the other programs provide incentives for renewable, nuclear, 

coal-fired, and integrated gasification-combined cycle generation, 

which tend to shift generation away from natural gas. Projected 

coal demand is reduced from its reference case level by about 10 

percent in 2025. 

Figure 4 in the written testimony shows that the NCEP policies 

are projected to significantly change the mix of investment in the 

electric power sector. Again, I mention the integrated gasificationcombined cycle capacity additions, which more than double compared to the reference case. Renewable capacity additions increase 

by nearly 150 percent and total renewable generation is up by 25 

percent over the reference case. At the same time, additions of conventional coal-fired generation capacity are less than 25 percent of 

the reference case level. 

The NCEP policies also affect energy prices. Lower demand for 

energy tends to lower the wellhead or minemouth price of energy, 

but the cost of emissions permits required under the cap-and-trade 

proposal adds to the delivered price of energy. So the net impact 

on the delivered price of energy reflects both of these effects. 

So to briefly summarize, the average price of petroleum products 

to all users is higher by a little bit more, 1.4 percent in 2025, with 

the NCEP proposals compared to the reference case. In the same 

year, average natural gas and coal delivered prices are 8 percent 

and 56 percent higher, respectively. Electricity prices in 2025 are 

6 percent higher, reflecting the higher cost of fuels. 

By 2025, the NCEP policies reduce energy-related carbon dioxide 

emissions by 8 percent due to lower energy demand and the change 

in the fuel mix. Covered greenhouse gas emissions, including gases 

inside and outside the energy sector, are reduced by 11 percent in 

2025. 

Figure 5 in the testimony shows the key role of emissions reductions outside the energy sector, which account for more than 50 

percent of the total reductions in 2015 and 35 percent of the total 

reductions in 2025 in the case with all of the NCEP policies, and 

an even larger share of total reductions from the cap-and-trade policy considered alone. The absolute level of emissions continues to 

grow in both cases, but at a slower rate than in the reference case. 

Economic impacts are clearly another important indicator. By 

2025 real gross domestic product in the NCEP case is reduced by 

.4 percent or $79 billion. That is in real 2000 dollars. As shown in 

figure 6, the NCEP cap-and-trade program alone is shown to have 

a smaller impact on the economy. 

To conclude, I would like to briefly discuss the relationship of 

this latest work to earlier analyses that EIA has done. We have 

looked at the Climate Stewardship Act, the McCain-Lieberman bill, 

which would have capped greenhouse gas emissions at the 2000 

74

level by 2010 and the 1990 level by 2016. A subsequent version of 

that, S. 2028, which we also looked at, removed the provision to 

tighten the cap beginning in 2016. 

Like the NCEP proposal, the two versions of McCain-Lieberman 

have cap-and-trade systems that start in 2010. But the NCEP capand-trade proposal is less stringent because it targets a reduction 

in emissions intensity that allows some growth in the absolute 

level of emissions and it includes a safety valve on the price of 

emission permits. Either version of the Climate Stewardship Act is 

projected to result in larger energy system changes and larger reductions in energy-related emissions than the NCEP package as a 

whole or its cap-and-trade proposal alone. Figure 8 in my written 

testimony shows emissions permit prices are significantly higher 

for those proposals. 

Another observation is that the safety valve feature of the NCEP 

cap-and-trade proposal protects against the possibility of large 

changes in the energy system and energy prices and of large economic impacts if reducing emissions is more costly than expected. 

However, if the safety valve becomes effective, emissions will be 

permitted to rise above the targeted level. So you have insurance 

on the cost, but on emissions levels you have more uncertainty. 

So policies with a firm cap on emissions provide emissions certainty regardless of cost to the energy system and the economy, 

and, therefore, when you are looking at that type of proposal, estimates of energy system and economic costs are subject to much 

greater uncertainty. 

That concludes my testimony. Thank you and I will be happy to 

answer any questions you might have. 

[The prepared statement of Dr. Gruenspecht follows:]

PREPARED STATEMENT OF HOWARD GRUENSPECHT, DEPUTY ADMINISTRATOR, ENERGY INFORMATION ADMINISTRATION, DEPARTMENT OF ENERGY

Mr. Chairman and members of the committee, I appreciate the opportunity to appear before you today to discuss the Energy Information Administration’s (EIA) recent analyses of greenhouse gas reduction policies. 

EIA is the independent statistical and analytical agency within the Department 

of Energy. We are charged with providing objective, timely, and relevant data, analyses, and projections for the use of Congress, the Administration, and the public. 

We do not take positions on policy issues, but we do produce data, analyses, and 

forecasts that are meant to assist policy makers in their energy policy deliberations. 

Because we have an element of statutory independence with respect to this work, 

our views are strictly those of EIA and should not be construed as representing 

those of the Department of Energy, the Administration, or any other organization. 

My testimony today will focus on EIA’s recent assessment of the impacts on energy supply, demand, and the economy that would result from the recommendations 

proposed in a December 2004 report entitled Ending the Energy Stalemate: A Bipartisan Strategy to Meet America’s Energy Challenges, prepared by the National Commission on Energy Policy (NCEP), a nongovernmental privately-funded entity. 

ETA’s report, Impacts of Modeled Recommendations of the National Commission on 

Energy Policy, released in April 2005, compares cases incorporating the NCEP recommendations to the projections of domestic energy consumption, supply, prices, 

and energy-related carbon dioxide emissions through 2025 in the reference case of 

the Annual Energy Outlook 2005 (AEO2005). AEO2005 is based on Federal and 

State laws and regulations in effect on October 31, 2004. The potential impacts of 

pending or proposed legislation, regulations, and standards—or of sections of legislation that have been enacted but that require funds or implementing regulations that 

have not been provided or specified—are not reflected in the projections. AEO2005

explicitly includes the impact of the American Jobs Creation Act of 2004, the Military Construction Appropriations Act for Fiscal Year 2005, and the Working Families Tax Relief Act of 2004. AEO2005 does not include the potential impact of energy 

75

* Figures 1-9 have been retained in committee files. 

legislation that is now being considered by the Congress or regulations such as the 

Environmental Protection Agency’s (EPA) Clean Air Interstate and Clean Air Mercury rules that were promulgated earlier this year. 

The projections in the AEO2005 and our analysis of the impacts of the NCEP policy recommendations are not meant to be exact predictions of the future but represent likely energy futures, given technological and demographic trends, current 

laws and regulations, and consumer behavior as derived from known data. EIA recognizes that projections of energy markets are highly uncertain and subject to many 

random events that cannot be foreseen such as weather, political disruptions, and 

technological breakthroughs. In addition to these phenomena, long-term trends in 

technology development, demographics, economic growth, and energy resources may 

move along a different path than expected in the projections. Both the AEO2005 and 

our report on the NCEP policy recommendations include a number of alternative 

cases intended to examine these uncertainties. 

Since ETA’s report has been provided to the committee and is available to the 

public on EIA’s web site, my testimony presents only a summary of its key findings. 

My testimony focuses on the NCEP case in our report, which includes all of the 

NCEP recommendations that EIA was able to model. However, I will also discuss 

some results for individual recommendations modeled separately, such as the proposed cap-and-trade program (CAP-TRADE case) linked to an intensity target for 

greenhouse gas (GHG) emissions, the proposed fuel economy standards (CAFE case), 

and the deployment incentives (INCENT case). Then, I will turn to sensitivity cases 

that highlight the effect of alternative technology assumptions on our results. Lastly, I will offer some comparisons to findings from some previous EIA analyses of 

policies to limit GHG emissions. 

MAIN RESULTS OF THE EIA ANALYSIS

The December 2004 NCEP report outlined a broad array of policy measures, not 

all of which were amenable to analysis using the EIA model of U.S. energy markets, 

the National Energy Modeling System (NEMS). Our analysis focused on the recommendations that could be modeled and which were thought to have a significant 

potential to affect energy consumption supply and prices. Where the NCEP recommendations required further specification, specific assumptions were developed in 

consultation with staff of the requesting committee. 

Our results show that the largest projected impacts on emissions, energy production, consumption, prices, and imports result from three of the NCEP recommendations: the cap-and-trade program linked to an intensity target for GHG emissions 

beginning in 2010, a major increase in corporate average fuel economy (CAFE) 

standards for cars and light trucks, and the new building and appliance efficiency 

standards. Other recommended policies generally affect specific fuels or technologies 

but do not have large overall market or emissions impacts. 

The impacts of the modeled NCEP recommendations, analyzed together unless 

otherwise noted, relative to the AEO2005 reference case, are discussed below. 

Energy Consumption 

Primary energy consumption is 2.26 quadrillion Btu (1.9 percent) lower in 2015 

and 6.73 quadrillion Btu (5 percent) lower in 2025 as the combination of efficiency 

programs and new CAFE standards reduces energy demand. Fossil fuel energy consumption is 2.5 quadrillion Btu (2.4 percent) lower in 2015 and 8.1 quadrillion Btu 

(6.9 percent) lower in 2025. In absolute terms, the use of all fossil fuels is projected 

to grow from 2003 levels through 2025. 

Figure 1* illustrates the impacts of the NCEP policies on oil consumption. Oil consumption in the NCEP case is 0.83 million barrels per day (3.4 percent) lower in 

2015 and 2.1 million barrels per day (7.4 percent) lower in 2025. The import share 

of petroleum product supplied declines from 62.4 percent to 61.3 percent in 2015 

and from 68.4 percent to 66.8 percent in 2025. As shown in Figure 1 almost all of 

the projected reduction in oil consumption results from the recommendation to increase fuel economy standards (CAFE case). More than two-thirds of oil consumption is currently used in the transportation sector, and the transportation share of 

total oil use is projected to grow to 71 percent in 2025 in the reference case. Because 

of the GHG permit safety valve, which caps the price of traded permits at $6.10 per 

metric ton of carbon dioxide (CO2) in 2010 rising to $8.50 per metric ton in 2025 

(2003 dollars), the maximum direct effect of the cap-and-trade policy on the delivered price of gasoline, diesel, or jet fuel is roughly 7 cents per gallon (2003 dollars). 

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Taken alone, a 7-cent price increase is not expected to spur either a switch to alternative fuels or prompt a significant increase in fuel efficiency (CAP-TRADE case). 

Figure 2 illustrates the impacts of the NCEP policies on natural gas consumption. 

Natural gas consumption in the NCEP case is slightly lower (0.45 quadrillion Btu 

or 1. 6 percent) in 2015 and 1.1 quadrillion Btu (3.6 percent) lower in 2025, due 

mainly to lower electricity demand from the building standards recommendation 

and the incentives provided for deployment of renewable, coal-fired integrated gasification combined-cycle (IGCC), and nuclear power plants that further reduce the 

size of the market for natural-gas-fired electricity generation. In contrast, when the 

cap-and-trade program is considered alone (CAP-TRADE case), projected natural gas 

consumption rises above the reference case level as natural gas replaces coal in electricity generation. 

Figure 3 illustrates the impacts of the NCEP policies on coal consumption. Coal 

consumption in the NCEP case is slightly reduced (0.46 quadrillion Btu or 1.8 percent) in 2015 and more significantly reduced (3.0 quadrillion Btu or 9.8 percent) in 

2025, due mainly to the lower electricity demand and shifts in the generation fuel 

mix that are caused by the cap-and-trade program. The technology incentives and 

building standards packages have offsetting effects on coal use, by encouraging 

IGCC plants while reducing electricity generation, so the net effect on coal use of 

the cap-and-trade program alone (CAP-TRADE case) is similar to that of the combined NCEP policy case. 

Figure 4 shows how the NCEP policies affect projected electric generation capacity 

additions over the 2004 to 2025 period. Because of the early deployment incentives 

(INCENT case) and the cap-and-trade proposal, projected IGCC capacity additions 

more than double, and renewable generation increases by 23 percent relative to the 

reference case. However, the projected capacity additions of conventional coal-fired 

technology decline to less than 25 percent of the reference case level. The shift from 

conventional coal-fired plants to more efficient IGCC plants results in an increase 

in the amount of generation per ton of coal consumed. 

Energy Prices 

The NCEP policy recommendations generally reduce the demand for fossil fuels, 

which tends to lower wellhead or minemouth prices. However, the cost of permits 

required under the cap-and-trade program tends to increase the delivered price of 

fossil fuels. When these effects are taken together, the cost of permits tends to dominate even with the safety-valve limit on permit prices in place, so the energy prices 

paid by end users generally rise. 

The average petroleum price to all users (including the price of emissions permits) 

is 2.2 percent higher in 2015 and 1.4 percent higher in 2025 than in the reference 

case, with the permit prices more than offsetting the lower crude oil prices resulting 

from the new CAFE standard. When the cap-and-trade (CAP-TRADE) program is 

considered without new fuel economy standards, the reduction in oil demand is 

much smaller, so the expected impact on delivered petroleum prices is larger. 

The average delivered natural gas price in our NCEP case is $0.17 per thousand 

cubic feet (2.7 percent) lower in 2015, with the wellhead cost reduction partially offset by the increased GHG permit price, and $0.52 per thousand cubic feet (7.6 percent) higher in 2025, largely because of the permit price which is added to the delivered fuel costs. The 2015 result reflects the impacts of building and appliance standards, which reduce residential electricity demand, and incentives for IGCC, which 

favor coal-fired generation relative to natural gas. 

When the costs of emissions permits are included, the average delivered coal price 

is $0.54 per million Btu (43 percent) higher in 2015 and $0.74 per million Btu (56 

percent) higher in 2025 than in the reference case because of the high carbon content of coal. The much higher percentage change in delivered coal prices compared 

to the other fossil fuels reflects both its high carbon content per unit of energy and 

its relatively low price in the reference case. 

The average delivered electricity price is projected to be unchanged in 2015 but 

is 0.4 cents per kilowatt-hour (5.8 percent) higher in 2025 because of the mandatory 

cap-and-trade program. EIA’s electricity price estimates reflect the assumption that 

consumers capture the economic benefits of the allocation of GHG permits to regulated utilities in areas of the country where electricity rates are set under cost-ofservice regulation. 

Emissions 

Projected reductions in energy-related CO2 emissions, which are concentrated in 

the electric power and transportation sectors, are 2.8 percent in 2015 and 7.7 percent in 2025. These reductions are larger than the corresponding reductions in priVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00080 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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mary energy use (1.9 and 5.1 percent, respectively for 2015 and 2025), as the NCEP 

policy recommendations promote a less CO2-intensive energy mix. 

Covered GHG emissions are 393 million metric tons equivalent (5.2 percent) lower 

in 2015 and 964 million metric tons CO2 equivalent (11 percent) lower in 2025. Covered GHG emissions intensity decreases by 5.1 percent in 2015 and by 10.6 percent 

in 2025. The absolute level of covered GHG emissions is projected to grow at an annual average rate of 1.1 percent over the 2003 to 2025 period, compared to annual 

average growth of 1.5 percent in the reference case. 

As shown in Figure 5, reductions in emissions of non-CO2 GHG emissions, which 

are not represented in a detailed fashion in NEMS, account for over 50 percent of 

the covered GHG emissions reductions in 2015 and 35 percent of the covered GHG 

emissions reductions in 2025. Estimates for non-CO2 GHG emissions were developed 

using emissions baselines and abatement cost curves based on engineering cost estimates that were supplied by EPA. Real-world factors affecting the behavior of decisionmakers and the use of incomplete cost information may result in an overstatement of the actual level of non-CO2 abatement achieved at each level of the permit 

price. However, as discussed below, due to the safety-valve feature of the proposed 

cap-and-trade program, the projected energy sector and economic impacts of the 

NCEP policy recommendations would not change significantly even if the assumptions used regarding the supply of GHG abatement opportunities were too optimistic. 

Because of the safety-valve price mechanism in the cap-and-trade program for 

GHGs, the GHG intensity targets specified by the NCEP are not reached. EIA 

projects that total emission reductions fall short of the emission target by 557 million metric tons CO2 equivalent in 2025. 

Economic Impacts 

Figure 6 shows the projected effect of t1 NCEP policy recommendations and the 

cap-and-trade policy considered separately on the projected level of real gross domestic product (GDP). By 2025, real GDP in the NCEP and CAP-TRADE cases are, 

respectively, 0.4 percent ($79 billion dollars) and 0.13 percent ($27 billion dollars) 

below the reference case levels. These changes do not materially affect average economic growth rates for the 2003 to 2025 period. Real consumption is also reduced 

over the 2010 to 2025 period relative to the reference case, with the impact reaching 

about 0.55 percent in 2025 ($74 billion in year 2000 dollars). 

Cap and trade systems or emissions taxes are generally considered the most economically efficient approach for reducing emissions, since they allow reductions to 

be made where they can be achieved at the lowest cost. In a pure cap-and-trade program, the price of emissions permits, which generally rises as the cap is made more 

stringent, is a good indicator of economic impacts. However, in a program that combines a cap-and-trade program with regulatory measures, a lower permit price does 

not imply lower economic impacts. Although the regulatory measures included in 

the NCEP case result in a lower projected price of emissions permits than would 

be expected if the cap-and-trade policy was implemented alone, the projected economic impacts in the NCEP case are higher than for the cap-and-trade only case 

in our analysis. 

TECHNOLOGY SENSITIVITIES

While the AEO2005 reference case used as the basis for comparisons in our analysis incorporates significant improvements in technology cost and performance over 

time, it may either overstate or understate the actual future pace of improvement, 

since the rate at which the characteristics of energy-using and producing technologies will change is highly uncertain. Relative to the reference case, ETA’s high 

technology case generally assumes earlier availability, lower costs, and higher efficiencies for end-use technologies and new fossil-fired, nuclear, and nonhydropower 

renewable generating technologies. 

Although the NCEP recommends increases in the funding for research and development, EIA, consistent with its established practice in other recent studies, did not 

attempt to estimate how increased government spending might specifically impact 

technology development. Instead, to illustrate the importance of technology characteristics in assessing the impacts of the NCEP recommendations, EIA prepared a 

set of NCEP policy cases using its high technology assumptions. Figure 7 shows how 

the use of high technology assumptions tends to reduce projected energy use with 

or without the recommended NCEP policies. Relative to the AEO2005 high technology case, the high technology case combined with the NCEP recommendations 

reduces fossil fuel use by 1.46 quadrillion Btu (1.5 percent) in 2015 and 4.48 quadrillion Btu (4.1 percent) in 2025. 

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Under the high technology assumptions, the NCEP’s greenhouse gas intensity 

goals are met, reducing covered GHG emissions intensity from 480 to 463 metric 

tons CO2 equivalent per million dollars of GDP in 2015 (3.5 percent) and from 405 

to 373 metric tons CO2 equivalent per million dollars in 2025 (7.9 percent). Attainment of the emissions intensity goal depends heavily on estimated reductions of 

non-CO2 GHG emissions, subject to the caveats above and on the use of banked 

GHG emissions permits that are exhausted in 2025, at the end of the forecast horizon for this analysis. Because energy consumption is already lower in the high technology case than in the reference case, the NCEP recommendations have a smaller 

relative impact to the high technology case. However, due the lower baseline consumption, the GHG intensity goals are easier to attain. 

RELATIONSHIP TO PREVIOUS EIA GREENHOUSE GAS ANALYSES

EIA has completed several other reports on policy proposals to limit or reduce 

GHG emissions. EIA’s previous analyses of emission reduction proposals indicate 

that the economic impacts are largely determined by the size of the energy market 

change required to satisfy the policy and the speed with which the change must 

occur. In 2003, EIA considered the original version of the Climate Stewardship Act 

(S. 139), which would cap GHG emissions at the 2000 level in 2010 and the 1990 

level in 2016 and beyond. In 2004, EIA considered an amended version of that bill 

(S.A. 2028) that removed a provision for a tightening of the emissions cap beginning 

in 2016. The NCEP proposal, S.A. 2028, and S. 139 all have a 2010 start date for 

their cap-and-trade systems. The NCEP proposal is less stringent than the others 

because it is expressed in terms of GHG emission intensity, starts from the 2010 

level, and includes a safety valve. 

These earlier reports suggest that either version of the Climate Stewardship Act 

is projected to provide larger reductions in emissions from the energy sector than 

the NCEP policy recommendations. To achieve this, higher permit prices (Figure 8) 

and larger energy system changes, particularly for electricity generation and demand, are required. 

That is, S.A. 2028 and S. 139 would require more significant changes in the U.S. 

energy system and larger increases in delivered energy prices than the NCEP recommendations, resulting in larger estimated economic impacts. As permit prices increase, electricity prices typically increase and reduce demand while electricity generation tends to shift away from coal technologies because of the high carbon content of the fuel and toward low or no-carbon emitting technologies like renewable, 

natural gas, and nuclear power generation (Figure 9). 

Finally, while all baseline and policy projections are inherently uncertain, differences in policy design can affect the impacts on the energy system and the level 

of GHG emissions. The safety-valve feature of the NCEP cap-and-trade proposal 

would allow GHG emissions to rise above the level projected in our report in the 

event that emissions reduction inside or outside the energy sector proves to be more 

costly than we expect, while protecting against the prospect of larger energy system 

and economic impacts in these circumstances. In contrast, policies that impose a 

‘‘hard’’ cap on emissions without a safety-valve price for GHG credits, would force 

the GHG emissions target to be met through higher GHG prices, regardless of the 

cost to the economy. 

This concludes my testimony, Mr. Chairman and members of the Committee. I 

would be pleased to answer any questions you may have.

The CHAIRMAN. Well, I want to thank you very much for your 

concise and understandable testimony. We appreciate it. 

Dr. Smith. 

STATEMENT OF ANNE E. SMITH, PH.D., VICE PRESIDENT,

CRA INTERNATIONAL 

Dr. SMITH. Mr. Chairman, members of the committee, thank you 

for your invitation to participate in today’s hearing. My name is 

Anne Smith. I am an economist and a vice president at CRA International. The opinions I will be presenting here are my own and 

not those of my company, CRA International. 

The role of technology frames the entire climate policy decision. 

If we believe the conclusion of climate scientists, then we must act 

to stabilize greenhouse gas concentrations at some level in order to 

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achieve significant reductions in climate risk. To accomplish this 

goal by about mid-century, this century, all new global energy 

needs will have to be satisfied from essentially carbon-free sources. 

That takes more than a few percent reductions here and there. 

No technologies available today, even as a group, are capable of 

providing this much carbon-free energy at an acceptable cost, and 

that fact makes the central challenge of climate policy all about 

stimulating breakthroughs that will lead to entirely new technologies that can accomplish this goal. 

None of the emissions limitations or the safety valves or subsidies proposed in the NCEP or by Senators McCain or Lieberman 

or in the amendment proposed by Senator Bingaman provide adequate incentives for this research and development, or R&D. Caps 

on emissions starting in 2010 can only motivate use of currently 

available technology and, although an assurance of high future carbon prices could motivate investment in the R&D that is required 

to create these radically new technologies, unfortunately the safety 

valve limits the rate of increase in carbon prices to a level that is 

too slow—too low, sorry, to stimulate that R&D. 

Now, even choosing a higher rate of escalation in the safety valve 

price would not work because it would not provide a credible private sector incentive for the R&D. The reason for this is explained 

more in my testimony, my written statement, but this is because 

once new technologies are developed then the most attractive 

choice for a future government will be to allow those allowance 

prices to fall down to the lowest level possible to incentivize the uptake of those new technologies. But that carbon price will never be 

high enough, that low carbon price will never be high enough to 

provide an adequate reward to the firms, the private sector firms, 

who invested in the R&D. This is because there is a fixed cost to 

R&D and by the time the technologies are available that fixed cost 

and expenditure by the private sector will be sunk and it will not 

be necessary for the government to ex post pay them back in order 

to get the technologies adopted. 

So here is the Catch-22 we face. Any announced future carbon 

price that is high enough to induce the breakthrough R&D would 

not be credible and any carbon price that is low enough to be credible as a sustainable policy in the United States would not be sufficient to induce the R&D breakthrough. 

Some people are saying that subsidies are necessary in combination with the safety valve price to achieve the needed R&D. In fact, 

the kinds of subsidies that are proposed in the Bingaman amendment and the NCEP proposal would only promote technologies that 

can be built at near-commercial scale today or in the very near future. 

If anything, this would just help—these subsidies would just help 

lock into place the current ways of reducing emissions, that would 

become obsolete if the R&D that we need becomes successful. 

The approach of layering subsidies onto a safety valve actually 

reveals that the policy, the safety valve policy that has been proposed with subsidies, would not be as cheap as the safety valve 

price would suggest. Consider this. If the safety valve price is set 

at a level that is supposed to be the maximum acceptable cost that 

our country is willing to spend on near-term emissions reductions 

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now, then the subsidies represent an end run around that spending 

limit. They directly cause spending on projects that cost more and 

exceed the price of the safety valve on a dollars per ton reduction 

basis. 

This is how it happens. The private sector will be willing to pay 

up to an amount equal to the safety valve price and then the Government will use funds that it has collected from the private sector 

to pay even more for those same projects. So the policy will be more 

expensive than advertised. 

Now, that might be justifiable if the policy were to provide incentives for breakthroughs toward a zero emissions world, but for reasons I have already explained it will not do that. 

So I want to be clear. Placing an economy-wide price on carbon 

emissions before the R&D is accomplished can be justified as a supplement to a meaningful R&D mission, but we need to first figure 

out what the R&D goals and targets are before we know how to 

set that price for today. 

I also want to be clear, the safety valve is a far better way to 

achieve this role of achieving near-term emissions reductions that 

are affordable than a hard cap. A low price on carbon emissions 

can serve to motivate low-cost emissions reductions and including 

a safety valve is important to limit the damage to the economy that 

could occur under a hard cap. 

But if setting a stable price, a stable and low price on carbon 

emissions, is the only near-term objective of the policy, then the 

rest of the cap-and-trade system is not needed and a carbon tax 

would do just as well. 

Some people think that a cap-and-trade system is better than a 

carbon tax approach and in part this is because the carbon cap approach allows the Government to make valuable allowance allocations to help offset the burden. But they are mistakenly believing 

that a carefully devised allocation scheme could make everybody 

better off and this is simply not possible. This I have also explained 

in detail in my written statement, the reasons for that. 

The possibilities of allocations, allowance allocations, does not 

make a cap-and-trade system any more cost-effective than a tax 

and yet, as we have seen, it can greatly complicate the process of 

getting the policy into place. 

Now, the safety valve is neither more nor less than a carbon tax 

and it would simple, more simple, more transparent, to propose a 

carbon tax than to devise a costly and complex apparatus of emissions trading to achieve what is a fairly modest goal of setting a 

low and stable price on carbon emissions. 

Now, I believe that the focus of the current debate on how to set 

a safety valve or a cap is encouraging policymakers to neglect the 

much more important and more urgently needed actions for reducing climate risks. The top priority for developing a climate change 

policy should be a greatly expanded government-funded R&D program, R&D, not subsidy program, along with concerted efforts to 

reduce barriers that currently limit technology transfer to developing countries, where some cheaper near-term reductions could be 

achieved now. 

Both of these actions present major challenges and both must 

really be initiated immediately if they are going to have their deVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00084 Fmt 6601 Sfmt 6602 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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sired effect in time to achieve the long-term emissions reductions 

that we want. Yet they are receiving minimal attention from policymakers, who are transfixed by the challenges of creating an unnecessarily complex scheme to set a low price on current carbon emissions even though that component of the climate policy will provide 

no reduction in climate risk. 

So thank you for the opportunity, giving me an opportunity to 

share my views on this important topic. I would be happy to answer questions. 

[The prepared statement of Dr. Smith follows:]

PREPARED STATEMENT OF ANNE E. SMITH, PH.D., VICE PRESIDENT,

CRA INTERNATIONAL

Mr. Chairman and Members of the Committee, thank you for your invitation to 

participate in today’s hearing. I am Anne Smith, and I am a Vice President of CRA 

International. Starting with my Ph.D. thesis in economics at Stanford University, 

I have spent the past twenty-five years assessing the most cost-effective ways to design policies for managing environmental risks. For the past fifteen years I have focused my attention on the design of policies to address climate change risks, with 

a particular interest in the implications of different ways of implementing greenhouse (GHG) gas emissions trading programs. I thank you for the opportunity to 

share my findings and climate policy design insights with you. My written and oral 

testimony today is a statement of my own research and opinions, and does not represent a position of my company, CRA International. 

I would like to start by summarizing what I think are the most important and 

overarching considerations that should be accounted for in devising a sound and effective policy to mitigate risks of climate change. I will then provide a basis for 

these points, present more extensive detail on the trade-offs in policy design alternatives, and summarize results of analysis my colleagues and I have done of the 

comparative costs and effectiveness of proposals now before the Congress. 

The key points that I have to offer about designing an effective climate change 

policy are:

• The linkage between near-term domestic GHG reductions and real reduction of 

climate change risk is, for all practical purposes, nonexistent. Near-term domestic controls cannot have any meaningful impact on global emission levels at any 

cost that is currently deemed realistic. Such policies also will not stimulate the 

kinds of technological progress necessary to enable meaningful emissions reductions later on (because one can expect that carbon prices will be driven to the 

lowest level necessary to incentivize adoption of important new technology—a 

level that is too low to provide innovators with a return of their one-time investment cost). 

• The current debate about how to impose ineffectual near-term controls is encouraging policy makers to neglect much more important, more urgently needed 

actions for reducing climate change risks. The top priority for climate change 

policy should be a greatly expanded government-funded research and development (R&D) program, along with concerted efforts to reduce barriers to technology transfer to key developing countries. Neither of these will be easy to accomplish effectively, yet they are receiving minimal attention by policy makers. 

• Developing new technologies is crucial and it will require long-run, high-risk, 

high-cost R&D to produce radically new GHG-free energy sources. Even with 

moderately expensive GHG limits, the private sector will under-invest in this 

kind of R&D, and only government can provide the needed R&D investment. 

The existing climate policy proposals, including the McCain/Lieberman (M/L) 

Bill and the NCEP or Bingaman proposals, focus on providing subsidies to existing technologies rather than R&D aimed at developing new technologies. New 

government efforts to pick winning technologies and subsidize their deployment 

would probably undermine the cost-effectiveness of any emissions control program, without producing the forward-looking R&D that we really need. 

• Although no near-term emissions control program will have much impact on 

solving the climate problem, a price on carbon in the near-term can be justified 

as a supplement to a meaningful R&D mission once that mission has clearly 

defined targets for success. The near-term control program’s role would be to 

stimulate emissions reductions that can be achieved now more cheaply than the 

present value of future control costs targeted by the R&D program; the maxVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00085 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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imum near-term carbon price could therefore be determined by discounting the 

R&D program’s defined targets for technology costs and dates of commercial 

availability. • The design of such a policy for near-term emissions control matters tremendously. CRA’s modeling work and the economics literature indicate the relative 

cost-effectiveness of the various options for the climate change situation.

a. Hard caps are the most costly and least desirable option. 

b. The safety valve approach and carbon taxes are alternatives to hard caps 

that are much less costly, and that are more consistent with the inherently 

subsidiary role of any near-term reductions program. (The contrast between a 

safety valve and hard cap approach is especially evident in my comparison 

below of results of CRA’s modeling of the McCain/Lieberman Bill and the cap 

program of the Bingaman Amendment.) 

c. One factor highlighted by CRA’s work but often slighted in other analyses 

is the possibility of using allowances to limit the costs of controls. Domestic 

GHG controls will cause small but not trivial losses of government revenue. 

Auctioning some of the allowances and using proceeds to offset other expected 

reductions in Federal revenue would noticeably reduce the program’s total cost 

to society. 

d. There are no simple analytical methods for determining allocations of allowances to individual companies or sectors to equitably mitigate the financial 

impacts of the policy. 

e. There is no allocation design that can make all affected parties better off 

under a cap-and-trade or other carbon pricing policy. 

f. The inherent complexity of a safety valve approach does not appear to be 

justified compared to a simpler carbon tax. A carbon tax would provide identical 

emissions reduction incentives at identical costs to those of the safety valve proposal without the political, institutional, and analytical complications apparent 

in today’s safety valve proposals.

To provide a foundation supporting the above statements, I will begin with a review of the basic elements of climate science and projections of future greenhouse 

gas emissions that are relevant to economic questions about the design of climate 

policies. In section 2, I will describe the range of potential policy designs, which include carbon-pricing schemes and technology strategies. Section 3 will focus on just 

the carbon-pricing approaches in more detail, and will include a comparative analysis that my colleagues and I have done of the costs and effectiveness of proposals 

now before the Congress. I will address costs and risks to the economy from different policy designs, the ability of economically feasible mandatory caps on emissions to accomplish long-term climate goals, the role of allocations in policy design, 

and alternatives to ‘‘mandatory limits on greenhouse gas emissions.’’ In Section 4, 

I will turn to technology strategies. I will explain the reasons for my conclusion that 

the most important first step for the Congress to take in developing a cost-effective 

US climate policy is to provide incentives for R&D into new energy technologies. 

In all of the following, I wish to be clear that I use the term R&D as a distinctly 

different concept from providing subsidies for the initial uptake of existing but yetto-be deployed technologies. By R&D, I mean investment to create technologies that 

do not exist today, and which would require major new scientific breakthroughs before they could become an option that any private entity might consider proposing 

in a competition for actual implementation under a subsidy program. The R&D may 

entail basic science as well as work that is identifiably on an energy technology with 

low or zero carbon emissions. Subsidies are aimed at bringing technologies into the 

market, and by definition, such technologies must be already reasonably well developed, if not yet cost-effective to use under current prices without supporting funding. There may be a sometimes unclear line dividing the two, but it is clear that 

we do not yet have enough forms of energy technologies that could, as a group, provide a carbon-free energy economy at any reasonable cost. Creating that capability 

should be the mission of an R&D program. 

1. Key Points from Climate Science and Global Emissions Scenarios 

The key points from climate science and emissions scenarios that are critical to 

the economic analysis of policy options are:

• Increases in global average temperatures are related to the concentration of 

greenhouse gases in the atmosphere. Once emitted, greenhouse gases remain in 

the atmosphere for many decades, so cumulative emissions over a long period 

of time determine changes in greenhouse gas concentrations. As a result, climate change risk is a function of cumulative greenhouse gas emissions, not 

emissions in any given year. 

83

1Their cost should be less than the present value of the cost of ‘‘making up’’ for them when 

the zero-carbon economy becomes viable. For example, if nearly all GHG emissions could be 

eliminated or offset at $25/tonne CO equivalent starting in 2050 (i.e., $93/tonne carbon-equivalent), then the most that it makes economic sense to pay for emissions reductions in 2010 is 

about $3.60/tonne CO2-eq. (or $13/tonne carbon-eq.), using a 5% real discount rate. 

• Discussions of long-term objectives for climate policy usually focus on stabilizing 

greenhouse gas concentrations at some level, so as to limit temperature increases. The concentration of greenhouse gases in the atmosphere will continue 

to increase as long as there are net additions of greenhouse gases. To achieve 

stabilization of concentrations and temperature at any level will require that 

average economy-wide greenhouse gas emissions be reduced to nearly zero. • Given the scale of projected increases in global greenhouse gas emissions, 

achieving zero net carbon emissions by the middle of the next century will require producing at least as much energy as is now produced from all sources 

by means of processes that have near-zero net carbon emissions. It is not possible to accomplish this with current technologies at anything close to the current or projected cost of energy produced from oil, natural gas, and coal. • Within the next decade or two, developing countries will overtake the industrial 

world in total greenhouse gas emissions, so that by 2025 more than half of global annual emissions of greenhouse gases will be coming from developing countries. Thus no long-term objective of climate policy can be achieved without effective actions to reduce emissions from developing countries. Moreover, comparison of greenhouse gas intensity between developing and industrial countries 

suggests that there is a large potential for near-term emission reductions in developing countries at costs far lower than comparable emission reductions in the 

United States and other industrial countries.

These features of the climate problem have some very strong implications for policy design. Since only cumulative emissions over long time periods matter for climate risk, mandatory caps that place specific limits on near-term emissions in each 

year create significant cost risks without accompanying benefits. Near-term limits 

on greenhouse gas emissions require the use of current technology for reducing 

greenhouse gas emissions, and as I will discuss in Section 4, they provide no credible incentive for research and development aimed at wholly new and more affordable technologies. 

Nearly-zero greenhouse gas emissions cannot be achieved with current technologies without massive disruption to standards of living. Once technologies are developed that can make massive emissions cuts affordable (even if still quite costly) 

then it will be possible to ‘‘make up for’’ reductions that we might not undertake 

today. Therefore the only reductions in emissions that make sense economically 

until zero-carbon energy becomes affordable as the mainstay of our energy system 

are those that are very cheap now.1

These considerations suggest that the most important long-term feature of any 

policy initiative is the impact it will have on investment in R&D and the development of new technologies to provide essentially carbon-free energy at an affordable 

cost. For near-term emission reductions, the most cost-effective emission reductions 

available today are in developing countries, placing a high priority on near-term 

control policies to bring about changes in how energy is used in developing countries. 

2. Overview of Range of Available Policy Approaches 

Proposed approaches for climate change policies that involve a commitment by the 

government to bring about changes in future greenhouse gas emissions include:

• Pure cap-and-trade 

• Cap-and-trade with a safety valve 

• Carbon tax 

• An R&D-focused ‘‘technology strategy’’

• Market transformation and technology transfer in developing countries

These policy approaches form a continuum, all of which can be implemented in 

a market-based manner. At one end of the scale are policy designs that impose specific, rigid limits on greenhouse gas emissions on specified dates. These are the pure 

cap-and-trade programs, which place a cap on emissions and allow trading of allowances between regulated parties to create an incentive for choice of the most costeffective mitigation options. Much attention has been paid to these designs, which 

have been used successfully in other environmental areas such as the Acid Rain program (Title IV) of the Clean Air Act. The McCain/Lieberman amendment to the 

2005 Senate Energy Bill (S. 1151) falls in this category. 

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The rigidity of emission limits is progressively loosened in proposals for combining 

cap-and-trade with a ‘‘safety valve’’ or for simply using a carbon tax to penalize the 

use of all fossil fuels in proportion to their carbon content. Both safety valve and 

carbon tax approaches avoid the imposition of a rigid cap, and instead rely on the 

economic incentive of putting a price on carbon emissions to achieve changes in 

emissions levels. 

An R&D-focused technology strategy would commit the Federal government to 

supporting the research to create new technologies whose adoption in the future will 

enable much larger and more cost-effective emission reductions than are possible 

today; this also can, and should be designed in a market-based manner. 

Thus, even now, the Congress is looking at a continuum of proposals, with the 

most rigid being the M/L Bill with its specific targets and timetables for near-term 

reductions, and the least rigid and potentially most cost-effective being a focus on 

devising and implementing a major and comprehensive R&D program to produce affordable, zero-emitting technology that will be possible to adopt on a massive scale, 

throughout our economy and that of the globe. 

The pure cap-and-trade approach places the highest priority on achieving fixed 

and predictable emission reductions, and accepts whatever the cost of achieving 

those emission reductions may be. The pure carbon tax limits the cost of achieving 

emission reductions to be no greater, per unit of carbon removed, than the tax. The 

emission reduction achievable from a carbon tax is uncertain, because it depends 

on how much emission reduction is possible at a cost equal to or less than the tax. 

Thus the carbon tax places the highest priority on cost containment, while tolerating some uncertainty in the level of emission reductions to be achieved. The safety 

valve becomes indistinguishable from a carbon tax once the price limit on emission 

allowances is reached. 

Technology policy and policies toward developing countries address the two features of climate policy that are not addressed by mandatory limits on near-term 

emissions. These, I will suggest, offer far more potential for cost-effective emission 

reductions in the near and long term, and are appropriate places for Congress to 

consider immediate action. 

This Congress has considered proposals in four out of these five categories. The 

proposed McCain/Lieberman amendment to the Senate Energy Bill of 2005 fell in 

the first category, of mandatory caps. Proposals by the National Commission on Energy Policy (NCEP) and Senator Bingaman (S.A. 868) fall into the second, safety 

valve, category. An approach to reducing emissions from developing countries was 

passed into law as Title XVI of the Energy Policy Act of 2005, along with some of 

the elements of a technology strategy. Only carbon taxes per se are not talked about 

in Washington, but the choice between carbon caps and carbon taxes is a very important one in the literature on climate policy. 

I do not believe it is appropriate to narrow consideration at this time to only 

‘‘mandatory’’ programs in the sense of binding caps on specific schedules, which if 

taken literally would include only the McCain/Lieberman proposal. Although used 

and justifiable in other environmental areas, this is not the most suitable policy design for climate change. Costs of large near-term reductions are high, mandatory 

caps create large risks and uncertainty about cost, and even mandatory caps cannot 

provide a credible incentive for R&D to develop needed technologies. Safety valve 

proposals, which become indistinguishable from carbon taxes once the safety valve 

becomes effective, offer additional flexibility and need not imply greater climate 

risks. 

Therefore, I would encourage you to include in your thinking about ‘‘mandatory’’ 

programs all policies that force households and businesses to take into account a 

cost of greenhouse gas emissions. This would recognize that carbon taxes, as well 

as the NCEP and Senator Bingaman’s approaches, are all ‘‘mandatory’’ approaches 

to emissions reductions. 

However, none of the mandatory programs aimed at putting limits on future carbon emissions will provide a credible incentive for R&D or actions by developing 

countries. Such mandatory programs are not the only actions that can be taken 

today. I have concluded that commitments to support technology development and 

bring about change in the rate of growth of emissions from developing countries are 

a more effective and appropriate focus for current action on climate policy. To my 

mind, it makes the most economic sense to start where resources committed to mitigation of climate change can achieve the greatest gains, considering both near-term 

and long-term outcomes as a whole. Therefore, we should start with a clearly articulated and carefully implemented R&D program for developing affordable zero-carbon 

emitting technologies. Neither the technologies nor the necessary R&D program to 

create them presently exists. 

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The first three approaches (pure cap-and-trade, cap-and-trade with a safety valve, 

and carbon taxes) all function by placing a direct price on GHG emissions. In the 

next section, I will discuss each of the individually, highlighting their respective 

strengths and weaknesses. I will then provide comparisons of the outcomes under 

a pure cap-and-trade proposal (i.e., the McCain/Lieberman proposal) to those of a 

proposal that directly limits costs rather than emissions (i.e., the GHG cap program 

of the Bingaman/NCEP proposal) to highlight how they tend to differ in their impacts. I complete the next section by addressing a number of issues related to allocation of allowances that I feel are greatly misunderstood, yet extremely important if 

a cap-and-trade approach is selected instead of a carbon tax approach for imposing 

a price on carbon emissions. The following, and last section, will then turn to an 

important limitation of all approaches that directly price emissions in the unique 

situation of climate change policy, and the reasons that an R&D-focused technology 

strategy needs to be the first and foremost consideration in any policy to address 

climate change risks. It is my view that none of the proposed policies to date properly address this R&D need. In general, they have confused subsidies with the need 

for R&D on new technologies, and for the most part the subsidy programs that have 

been proposed are also unnecessary for motivating a least-cost response under a carbon-pricing program. 

3. Approaches that Place a Direct Price on Emissions 

A. Pure cap-and-trade with rigid emission limits 

Emission caps are enforced, under cap-and-trade proposals, by distributing a set 

of emission allowances, limited to the quantitative cap. These emission allowances 

can be traded, so that emission reductions will occur where they are most cost-effective given current technology. The cost of a cap-and-trade program depends on how 

tightly the caps are set initially and how they are tightened over time. How emission allowances are distributed also affects the overall economic impact of this policy 

approach. 

Near-term caps, such as those proposed by Senators McCain and Lieberman, can 

only be met through use of costly measures based on today’s technology. This raises 

their costs substantially compared to a policy sequence in which new and more affordable technologies are developed first, so that much larger emission reductions 

can be achieved at much lower cost. 

Emission caps, even if never tightened, will become more expensive over time, because energy needs are always growing as population increases and the economy expands. Holding greenhouse gas emissions constant in the face of ever-increasing energy demand requires going to ever more costly control options. The depth of the 

cuts required can be seen by comparing business-as-usual, or current-policy emissions to emissions under the cap. Based on the current EIA Annual Energy Outlook 

forecast for emissions under current policies, the limits proposed by Senators 

McCain and Lieberman would require total CO2 emissions from covered sectors to 

be reduced to 15% below current policy levels in 2010 and 26% below current policy 

levels in 2020. Continuing the McCain/Lieberman cap to 2050 would require a reduction of emissions to 48% below current policy levels in that year. Tightening the 

cap to a level consistent with current proposals for programs that could stabilize 

greenhouse gas concentrations in the atmosphere would require emissions to be reduced to more than 80% below what CRA International projects for current policy 

emissions in 2050. 

The imposition of rigid limits creates unnecessary cost risks, even in the nearterm, because rigid limits can become very expensive if economic growth exceeds expectations or if costs of measures required to reduce emissions turn out to be higher 

than assumed. Since climate risks are not affected by variations in emissions from 

one year to the next, but only by cumulative emissions over long time periods, these 

cost risks associated with rigid caps are completely unnecessary to achieving longterm climate goals. 

The perception that fixed caps create excessive cost risks is, I believe, widely 

shared. The McCain/Lieberman amendment would have created specific fixed and 

mandatory caps. Other policy approaches before Congress are based on a recognition 

that setting this kind of mandatory cap is not the only way to take effective action 

to address climate change. All the other approaches before the Congress involve 

market based incentives, but do not place a rigid cap on emissions. These approaches are more suitable to the nature of the climate problem. 

B. Cap-and-trade with a safety valve 

Combining cap-and-trade with a safety valve has the purpose of reducing the cost 

risk associated with the pure cap-and-trade approach. Senator Bingaman and 

NCEP’s proposals also reflect a concept called an ‘‘intensity-based’’ cap, but this only 

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serves to reduce the expected costs of the policy. The real reason that these proposals have reduced risk of unexpectedly (and unacceptably) high costs lies wholly 

in the safety valve provision. 

The original concept of an ‘‘intensity-based’’ target is that caps would only be 

tightened in relation to economic activity levels. If economic activity is high, an intensity approach would allow a somewhat looser cap to accommodate the extra need 

for energy, rather than to choke it off by having a rigid cap no matter what the 

level of economic activity. However, as implemented in these two current proposals, 

the ‘‘intensity-based’’ cap would, in fact, still be an absolute cap, computed up to ten 

years in advance and rigid thereafter. Its primary novelty is that by computing a 

cap that is tied to economic growth rather than historical outcomes, it would more 

gradually phase in the cap’s apparent stringency. This certainly makes such a cap 

less costly than a tighter cap that prevents any further emissions growth at all. 

However, as long as the cap is binding at all (which is the intention), there is still 

uncertainty on how costly it will actually be to attain, especially given its rigidity 

over ten-year periods. (A cap that is truly flexible from year to year in response to 

economic activity outcomes might somewhat mitigate this cost uncertainty, but 

would require continual, year-to-year updating of allocations. This updating would 

probably be more detrimental than helpful in producing compliance planning certainty, while still not assuring that costs of control would remain below some 

planned level.) 

Nevertheless, the Bingaman and NCEP proposals do have much less cost risk 

than previous cap-and-trade proposals, entirely due to the safety valve provision. 

The safety valve places a ceiling on the price of carbon allowances under the cap 

provision. This would be accomplished by allowing companies to achieve compliance 

by paying the safety valve price to the government in lieu of turning in actual allowances that have been issued. Alternatively, the government could issue more allowances at the safety valve price, which would then be turned in along with originallyissued allowances. Either way, the effect of the safety valve is to make the cap itself 

flexible rather than rigid. However, its flexibility is linked to the cost of control 

rather than to economic activity per se. 

In summary, the safety valve is a very important way of minimizing cost risk 

under a carbon emissions control policy, and it does so by converting the carbon cap 

into a carbon tax if the cost of control to meet the cap is higher than the pre-agreed 

safety valve price. By design (and also just like a tax), this can alter the amount 

of emission reduction that is achieved, thus making emissions reductions uncertain 

instead. 

C. Carbon taxes 

Once the safety valve becomes effective, the environmental outcomes and control 

costs under a program based on safety valves become indistinguishable from a carbon tax. However, a carbon tax policy would avoid creating the costs and bureaucracy associated with allocating allowances and administering an emission trading 

and enforcement system. 

All of these approaches—rigid caps, caps with safety valve, and carbon taxes—

share a common feature of mandatory but market-based emission limitation. They 

require an emitter to pay for its legal emissions, either by purchasing an allowance, 

foregoing revenues from the sale of an allowance it was allocated, or paying a tax. 

Each creates revenues, and the choice must be made in designing the policy of who 

will collect these revenues and how they will be used. This is the choice between 

auction and allocation of allowances under a cap-and-trade system. 

The safety valve involves the sale of emission allowances for a fixed price. It is 

equivalent to charging a carbon tax on the use of fossil fuels, with the tax rate set 

for each fuel based on its carbon content. Use of a carbon tax would also leave control of how to use the revenues under the normal budget process. In contrast, revenues from auctioning allowances or from selling allowances under a safety valve can 

be placed outside the budget process, as they are in both the McCain-Lieberman and 

Bingaman proposals. Using a free allocation of carbon allowances to compensate 

some of those harmed by the imposition of limits on greenhouse gas emissions is 

also a use of potential revenues that could accrue to the government, and removes 

decisions about that use of revenues from the normal budget and authorization and 

appropriation process. This has a very important influence on overall economic 

costs. 

The proposed cap-and-trade and safety valve programs are likely to impose higher 

costs than a carbon tax. In part, this is true because they are likely to have greater 

administrative costs than an explicit tax. But more importantly, by taking revenues 

outside the normal budget process, these policy designs eliminate the possibility of 

using some or all of the revenues to replace taxes that would otherwise have to be 

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2For documentation of the MRN model, see http://www.crai.com/pubs/publ3694.pdf.

raised through other federal tax programs. As I discuss in subsection E below, not 

allowing revenues from allowance auctions to be used to offset impacts of emission 

limitations on total government revenues substantially increases the cost of the 

Bingaman and McCain/Lieberman approaches. 

Otherwise, the effects of cap-and-trade with a safety valve and a carbon tax are 

indistinguishable. Consumers of energy will experience increases in the cost of energy, in one case by the price that energy producers must pay for carbon allowances 

and the other by the carbon tax they must pay. The response of businesses and 

households to these altered prices will be identical. Differences will arise only from 

how potential revenues from the safety valve or carbon tax are utilized. 

D. Analysis of the costs of mandatory caps and safety valves 

In order to quantify the costs and emission impacts of the McCain/Lieberman and 

Bingaman amendments, my colleagues and I have used CRA’s Multi-Region National Model of the U.S. economy.2 This model has been used in a variety of studies 

over the past 10 years, and was used by the National Commission on Energy Policy 

in its own analysis of the economic impacts of its proposals. 

We have analyzed a range of estimates for the impacts of the McCain/Lieberman 

proposal (M/L) and of the carbon cap program in the Bingaman Amendment (BA). 

For M/L our range was based on assumptions about the cost at which a carbon free 

‘‘backstop’’ technology will become available and how that cost will drop over time; 

the availability and cost of ‘‘offsets’’ to CO2 emissions in covered sectors; and the 

choices that will be made about long-term emission limits after 2020. For the BA, 

at the low end of the range, we assume that regulated non-CO2 GHGs are able to 

be costlessly reduced up to the point where the marginal cost of reducing those 

other GHGs exceeds the safety valve price, based on marginal abatement cost 

curves prepared by MIT. At the high end of the range, we assume that non-CO2

GHGs are reduced costlessly only up to the point where they achieve their own 

share of the intensity targets. Our baseline or ‘‘current policy’’ emissions trajectory 

was based on the AEO 2005 reference case forecast of CO2 emissions, and was not 

varied, though this would be another source of cost uncertainty, especially for the 

M/L rigid caps. 

The form of Senator Bingaman’s carbon cap proposal that we analyzed sets a cap 

on greenhouse gas (GHG) emissions from 2010 onward. The cap is to be calculated 

in 2006 so that it will cause greenhouse gas intensity (GHG emissions divided by 

GDP) to fall by 2.4% per year from 2010 to 2020, and then to fall by 2.8% per year 

thereafter. The required improvements in GHG intensity are converted to fixed caps 

for the next decade by multiplying the required GHG intensity times the level of 

GDP in each year that is projected as of 2006. 

We applied a ‘‘safety valve’’ which allows regulated entities to purchase carbon al- lowances for a price of $7 per ton of CO2 in 2010, escalating at 5% per year (nominal). Both the safety valve escalation and the annual improvement in GHG intensity 

can be revised by joint resolution. The bill requires the President to report to Congress on what other countries are doing to reduce GHG emissions as a basis for recommending such revisions. The proposal includes some, but not all, emissions of 

non-CO2 GHGs in the calculation of GHG intensity and allows banking of allowances for use in future years. 

We assumed that under Senator Bingaman’s proposal a large fraction of carbon 

allowances will be ‘‘allocated’’ to businesses that face disproportionately large negative impacts, and that 5% in 2010, rising to 10% by 2020, of the allowances will 

be auctioned to provide funding for subsidies for the development and deployment 

of selected energy technologies. 

Sources of economic impacts. Economic impacts arise from four major sources. Direct costs of complying with emission limitations or of adjusting energy supply and 

use in response to a safety valve/carbon tax are incurred by energy producers and 

consumers. These costs arise from the necessity of diverting resources from other 

productive uses to reducing greenhouse gas emissions. The activities involved include substituting more costly but lower carbon forms of energy for fossil fuels, making investments and incurring higher costs to improve energy efficiency, and losing 

the benefits of foregone energy services. 

A second set of costs arises from an increased excess burden of existing taxes. 

Both the Bingaman and M/L proposals provide for allocations of allowances and 

specify how revenues from allowance auctions will be utilized. They do not allow 

proceeds to be used to reduce other taxes. It is widely accepted among economists 

who study the Federal tax system that the current set of income, payroll and corporate taxes impose a deadweight loss on the U.S. economy. It has been found in 

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3On the issue of how existing tax distortions are magnified by emission limits, see Larry 

Goulder, Ian Parry and Dallas Burtraw, ‘‘Revenue-Raising vs. Other Approaches to Environmental Protection: The Critical Significance of Pre-Existing Tax Distortions,’’ RAND Journal of 

Economics, Winter 1997; and Larry Goulder and Lans Bovenberg, ‘‘Optimal Environmental Taxation in the Presence of Other Taxes: General Equilibrium Analyses,’’ American Economic Review, September, 1996. 4 In very approximate-terms, the share of the allowances that the government would need to 

offset tax base erosion and thus avoid exacerbating policy costs appears to be between 30% and 

60%. This is based on multiple scenarios analyzed by CRA International using its MRN model, 

and apparently has been corroborated by analyses by Prof. Goulder of Stanford University (personal communication). 

* The exhibits have been retained in committee files.

a number of studies that a system of emission limits or carbon taxes that raises energy costs effectively increases the burden of existing taxes on the economy.3 Using 

the revenues from sale of carbon allowances or from a carbon tax to substitute for 

revenues that would otherwise be raised through conventional taxes can reduce or 

eliminate this distortion. Allocating emission allowances at no cost removes that 

ability to reduce the distortions of the tax system and contributes to higher costs, 

as does reserving revenues for new spending programs that are created by the policy. 

CRA’s analyses have revealed a need for governments to use allowance auctions 

under a GHG cap to generate a certain amount of new government revenue to offset 

likely reductions in existing tax revenues due to a decline in economic activity from 

the cost of the policy. If such offsetting revenues are not tapped from the value of 

the allowances, then governments will either have to cut services or else raise existing tax rates. The latter action would actually exacerbate the costs of the policy, and 

thereby create an inefficiency due to tax distortions even while the carbon allowance 

market may function in a perfectly efficient manner in achieving cost-effective emissions reductions to meet the cap. Neither of the proposals analyzed provides for any 

revenues to be used to offset tax base erosion.4 Although there are some revenues 

from auctions and safety valve sales, these revenue sources are earmarked for new 

spending programs rather than to supplement other, falling sources of government 

revenues. 

A third cost element arises from the transition costs of job search which are triggered by the changes in real wages and shift in industry structure causes by emission limits or safety valve/carbon tax policies. This cost element shows up directly 

in the results as an increase in transitional unemployment, and contributes to reduced GDP and to lower household consumption and welfare. 

Finally, since MRN is a fully dynamic computable general equilibrium model with 

forward-looking expectations, the prospect of rising carbon allowance prices and future economic impacts leads households to change their current saving and investment behavior. Households reduce their current consumption, in order to save and 

provide for higher future income to cover the increasing costs of tighter emission 

limits and rising safety valve/carbon taxes. This anticipatory behavior makes future 

costs show up in the present. The banking option included in both M/L and BA also 

encourages businesses to undertake emission reductions in early years in excess of 

those required by carbon limits, in order to avoid even higher future mitigation costs 

due to tightening emission limits or higher safety valve/carbon taxes. This also contributes to costs in early years. 

I provide details of our comparison of the impacts of M/L and BA in Exhibits 1-

4* at the end of this testimony. Generally speaking, our results suggest that M/L 

impacts are about 3 to 4 times larger than the impacts for the BA cap program. 

Key economic indicators all follow this pattern: 

• For 2010, the GDP loss under BA would be about $21 billion to $34 billion, or 

a 0.1% to 0.2% reduction (compared to 0.3% to 1.0% for MIL). The GDP loss 

increases over time, both because the percent impact of BA increases with time, 

and because GDP increases with time. 

• GDP loss under BA in 2020 is $70 billion to $96 billion. (This compares to $214 

to $517 billion for M/L) It reflects a 0.3% to 0.4% reduction in 2020 GDP (compared to 0.8% to 1.9% for M/L). 

• Per household consumption losses under BA are $135 to $147 in 2010 and $147 

to $164 in 2020. (Comparable M/L losses are in the $450 to $800 range.) 

• Job losses under BA in 2020 are 281,000 to 326,000 (compared to 793,000 to 

1,306,000 under M/L). 

• Reduction in coal output in 2020 is 8% to 11% (compared to 23% to 42% for 

M/L). 

• Reduction in refined oil output in 2020 is 2% (compared to 6%-13% for M/L). 

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• Carbon prices are $13 to $18/tonne C in 2010 and $21 to 29/tonne C in 2020. 

(M/L carbon prices are $47-$130 in 2010 and $75-$209 in 2020.) 

• Under BA, carbon allowance prices hit the safety valve price in 2020 in the high 

case and 2035 in the low case.

The greater cost certainty associated with the safety valve is apparent in the fact 

that our M/L cost ranges are much wider than those we estimated for the BA cap. 

However, the lower overall costs of the BA cap simply reflect the fact that it imposes 

a much less stringent demand for near-term emissions reductions. Over the period 

from 2020 to 2050 BA provides emission reductions that total between one-third and 

two-fifths (32% to 40%) of those provided by M/L. Since the costs of BA range from 

25% to 33% of M/L, the comparison also illustrates the law of diminishing returns, 

in that it costs proportionately more to achieve the larger emission reductions required by M/L. 

E. Issues in allocating allowances 

Allocations versus auctions. I understand the committee is very interested in the 

issue of allocation of allowances under Senator Bingaman’s proposal. This is a feature of policy design for which there are several alternatives. Senator Bingaman distinguishes between auction and allocation. Some allowances would be allocated to 

parties that suffer disproportionate harm from emission limits, and some would be 

auctioned and provide revenues. 

The first question that the Committee might want to consider is who should control the use of the revenues from any auctioned or safety valve allowances. If revenues are placed in the general fund, then Congress will retain the ability to make 

the decisions about how the revenues will be utilized. This will allow Congress to 

consider all societal needs together, and to balance competing needs as they evolve. 

To place the proceeds into a Trust Fund that earmarks them for spending only related to climate policy is tantamount to deciding now that climate-related spending 

needs to be separated from all other government spending decisions, and given a 

separate, more elevated priority than all other societal needs, including future needs 

that may not be anticipated at present. Public finance practitioners generally frown 

on the idea of earmarking funds from particular revenue sources to particular purposes, because the amount of money that will be collected from a particular source 

is only connected loosely, if at all, to the amount that it is wise to spend on even 

a related purpose. Thus earmarking is likely to produce either too much or too little 

funding, and it removes the decision about how much should be spent from the normal budget, authorization, and appropriation process. 

In this regard, I also note that free allocation of allowances is not the only way 

to provide for compensation of affected parties. Any compensation that can be 

achieved by a free allocation formula could, in principle, be replicated under a 100% 

auction—it would only require that the auction revenues be returned to companies 

by the same formula that would have been used for allocations. Funds could be appropriated to provide compensation for those disproportionately harmed, or specific 

tax credits could be enacted. Determining how to make this compensation using normal budget processes would be no harder than determining how to allocate allowances under the procedures outlined in Senator Bingaman’s proposal. 

While general principles of public finance suggest that separation of revenues 

from such a policy into a Trust Fund is probably unwise, my personal research has 

found that such an approach also could exacerbate the total costs of any carbon-pricing policy, and thus would be inconsistent with principles of minimizing policy costs. 

Paradoxically, allocating all of the allowances at no cost to affected parties, and/or 

using all of the proceeds from sale of allowances to fund new spending programs, 

can lead to far larger costs to the economy than necessary. This policy cost inflation 

can be averted by using some allowance or carbon tax revenues to replace other 

taxes that would have to be raised to meet budget targets. By allowing carbon policy 

revenues to flow to the general fund, Congress retains its ability to determine how 

much of the proceeds from allowance sales or carbon taxes should be used for replacement of other tax revenues that can be expected to decline under the carbon 

policy. 

Free allocations cannot compensate all businesses and households. Impacts on 

households and industry are not determined by where regulations are put in place. 

An upstream system like that in Senator Bingaman’s proposal still imposes costs 

on households and industries. Not all the costs are borne by fuel suppliers, even if 

they are the point of regulation. All users of energy have higher production costs. 

Some will be able to pass some of these costs to their consumers, while others will 

have little ability to pass costs through, and the brunt of the financial impact will 

be borne by their shareholders. In the end, households cannot pass the costs on to 

90

anybody, and they ultimately bear the entire cost, as consumers of higher cost of 

goods and services, and as shareholders in companies that cannot pass the costs on. 

Conceptually, allocations could be used to help compensate the companies that 

bear an exceptional and unfair burden. We have, in other contexts, estimated the 

average loss in capital value to owners of assets in aggregated economic sectors such 

as the oil, gas, coal and electricity generation sectors. However, there is no simple 

formula to identify exactly which companies these are, or what amount of allocation 

would actually provide for an equitable burden sharing arrangement. Companies 

within the same economic sector may face diverse impacts, so that an estimate of 

the ‘‘average’’ loss of profitability for each sector may bear no correlation to the sum 

of losses across the negatively affected companies within each sector. Even if one 

could identify reasonable allocations to each sector of the economy, comparable allocations to each company within a sector would have little chance of equalizing burdens within the sector. Attempts to analytically identify company-specific burdens 

within a sector would be even more challenging than attempts to identify needs by 

sector, as the relevant data are not even publicly available. Thus, the idealized concept of mitigating the impact of the rule on individual companies cannot be estimated quantitatively at the level of detail needed to define company-level allocations, let alone be condensed to a relatively simple formula. 

It is also important to realize that the energy sectors (including non-regulated entities in the energy sectors) are not the only sectors that will bear losses of capital 

value as a result of a carbon pricing policy. All sectors of the economy will be affected to some degree, as all are consumers of energy to varying degrees. As more 

and more of the needs to be compensated are recognized, the identification of a 

‘‘fair’’ allocations rule will become exceedingly complex. 

More importantly, once it is recognized that needs for compensation include all 

individual energy consumers, and not just companies, policy makers will have to realize that it is not possible to offset losses for everyone through allocations of allowances. The total cost of a cap-and-trade system will always exceed the total value 

of the allowances in that system:

• This is because companies must pay (1) to reduce emissions down to the level 

of the cap and also (2) for every ton of emissions that remains after meeting 

the cap. The value of the allowances equals only the second component of total 

costs. At most, the government can give that entire value back to the companies 

by free allocation of 100% of the allowances, but that leaves companies still incurring the first cost component, and without any way to compensate them for 

that cost—which is the real net cost to society. 

• It is true that companies may be able to pass some of these two cost components on to their customers, and so directly-regulated companies could be given 

more compensation than the cost that their shareholders bear if all of the allowances were allocated to them alone. However, this only means that a part of 

the net cost has been spread to other, non-regulated parties, including consumers. They, in turn, would require their share of the allowance allocation to 

be compensated for the part of the cost that was passed to them. There is not 

enough value in the allowances to cover all costs to regulated companies if they 

cannot pass those costs on, and neither can that value cover all the incurred 

costs after they are divided up and spread throughout the entire economy.

Thus, a carbon pricing policy will always impose a real net cost on the economy 

that cannot be eliminated through any allocation formula that may be devised. All 

that an allocation scheme can do is alter the companies and individual consumers 

that end up bearing the burden of that cost. 

These challenges in identifying fair allocations are not a result of proposing an 

upstream point of compliance. They would be equally difficult under any downstream or hybrid form of implementation. They do, however, present more prominent issues when using a cap-and-trade approach than under a carbon tax, because 

the former system does require that a specific decision be made for how to distribute 

the allowances. (At the same time, needs for compensation and burden sharing 

would also exist under a carbon tax, and there would also be equivalent degrees of 

ability to achieve such compensation under a carbon tax.) 

Administrative costs and bureaucracy for small and distant emission reductions.

I have estimated that under Senator Bingaman’s proposal, the price of carbon allowances would rise above the safety valve level between 2020 and 2035. EIA puts this 

somewhat earlier. 

This effectively turns the Bingaman proposal into a carbon tax program, but with 

the much higher costs of an administrative apparatus for issuing, enforcing, and 

trading carbon allowances that doesn’t actually do anything other than impose a 

pre-determined price on carbon emissions. 

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5 Nuclear power presents a different situation. Although the technology is nearly zero-emitting 

(there are some emissions associated with its fuel cycle), available now, and cost-effective under 

even a modest carbon pricing scheme, its deployment is hampered by existing policy. Removal 

of institutional and political barriers to new nuclear generation might be the most important 

way of enabling existing nuclear generation technology to provide cost-effective emissions reductions within the next two decades. 

This leads to the question of whether it is desirable to create the bureaucracy and 

administrative burden of a comprehensive national emission trading program for 

the small reductions that are possible with a safety valve. The main differences between safety valve proposals and simply establishing a federal fuels tax based on 

carbon content are (1) that the safety valve has a greater administrative burden, 

and (2) the safety valve approach allows revenues that would otherwise go into the 

normal budget process to be handed out by an executive agency or quasi-government corporation. 

Thus the government cedes the ability to set overall social priorities for the use 

of the funds. Further, it sets the stage for automatically spending whatever is collected on climate-related technologies, without regard to the need for spending at 

such a level. Because it is not tied to an R&D program with clearly specified goals 

and a plan for meeting those goals, much of the spending is likely to result in subsidies on investments that would occur anyway (because they are cost-effective 

under the carbon price) or on investments that are not desirable (because they are 

only feasible at a cost that is higher than the safety valve price, which by definition 

reflects the maximum that is deemed reasonable to spend on near-term emissions 

reductions).5 The use of an outside entity does not solve the problem of creating a 

good R&D program; but it does mean that Congress loses the opportunity to make 

those R&D spending decisions directly and transparently. 

4. The Need for R&D Strategy to Be the Leading Edge of Climate Policy 

A. New technology is not encouraged by mandatory limits 

Although M/L has much more substantial (and uncertain) costs than the BA cap 

proposal, both proposals have substantial costs. But despite these costs to the economy, neither fixed caps nor safety valve/carbon tax policy designs can provide an 

adequate incentive for the critical piece of the solution—which is creation of radically new technologies. In my opinion, it would be better now to put resources into 

developing new technologies than in forcing the use of existing technology to achieve 

relatively small and costly emission reductions. Creating an effective R&D program 

will not be cheap, but it ultimately has to happen if climate risks are to be reduced. 

The difficult decisions are how much to spend now, and how to design programs to 

stimulate R&D that avoid mistakes of the past. 

The subsidies to current technology embodied in BA and M/L are not likely to 

bring about that change in the fundamental direction of R&D, because they are directed at the demonstration and use of current technology. These subsidies should 

be carefully distinguished from funding for R&D. Most subsidies would be unnecessary under a carbon-pricing program, as the market price of carbon due to the cap 

provides the appropriate financial incentives for the optimal use of the control methods that would then also benefit from the subsidies. A well-designed policy to address needs for R&D in entirely new technologies is needed, not subsidies to get existing technologies deployed in the market place. A very different commitment is 

needed to create programs that will change the direction of basic research toward 

creation of climate friendly, zero carbon technologies. Subsidies for demonstration 

and use of currently available technologies do not create incentives for creation of 

entirely new technologies. 

In BA, the carbon intensity basis for mandatory caps ensures that they rise 

gradually, so that there is little change in emissions for the next decade. The safety 

valve, by design, takes over from the mandatory cap when its costs begin to rise. 

By design, the safety valve will not stimulate the desired level of R&D. By attempting to limit cost to a level deemed tolerable, it eliminates adequate incentives for 

R&D on new technology. 

Nor will an adequate incentive be provided if the safety valve were eliminated, 

now or in the future. This would provide a trajectory of rising allowance prices and 

tightening limits. But those future policy results cannot be a credible incentive for 

current R&D, as I explain next. 

B. Carbon pricing programs cannot provide credible incentives for technology 

development 

Whether cap-and-trade or a carbon tax is the policy approach taken, these mandatory programs cannot achieve the most important need in a climate program, which 

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6M.I. Hoffert et al., ‘‘Advanced Technology Paths to Global Climate Stability: Energy for a 

Greenhouse Planet’’ Science, Vol. 298, Nov. 1, 2002, p.981. 7For example, if all of the existing U.S. natural gas-fired combined cycle generating capacity 

were to suddenly be fully utilized, we estimate based on our models of the U.S. power sector 

that current annual U.S. CO2 emissions would be reduced by about 80 MMTC—about a 4% reduction in total U.S. GHG emissions—and it would come at a cost of about $80/tonne C, even 

if gas prices would not be inflated by the sudden surge in natural gas demand. 8These points are developed in a more rigorous fashion in W.D. Montgomery and Anne E. 

Smith ‘‘Price, Quantity and Technology Strategies for Climate Change Policy.’’ To appear in 

Human-Induced Climate Change: An Interdisciplinary Assessment, Cambridge University Press, 

forthcoming 2005. 

is to stimulate development of the kinds of technologies that alone can make significant mitigation of climate risk possible in the long run. 

Emission caps are not only premature and risky for the economy. They are not 

capable of stimulating the kind of technology development that is an absolute necessity to achieve any of the objectives of climate policy. Putting a stop to the continued 

growth of greenhouse gas concentrations in the atmosphere requires meeting all of 

today’s energy needs in a way that produces zero net carbon emissions, and does 

so at acceptable cost. That is not possible with the set of technologies that exist 

today. 

Hoffert et al. argue that ‘‘the most effective way to reduce CO2 emissions with economic growth and equity is to develop revolutionary changes in the technology of 

energy production, distribution, storage and conversion.’’6 They go on to identify an 

entire portfolio of technologies, suggesting that the solution will lie in achieving advances in more than one of the following categories of research: 

• wind, solar and biomass • nuclear fission • nuclear fusion • hydrogen fuel cells • energy efficiency • carbon sequestration

Currently available technologies cannot provide sufficient or low cost reductions 

to meet the GHG challenge. Developing that supply will require basic science and 

fundamental breakthroughs in a number of disciplines. The magnitude of possible 

reductions in the next decade or two achievable with today’s technology is dwarfed 

by the magnitude of reductions that successful innovation would supply through 

these routes.7

Emission caps cannot provide adequate incentives. Even combined with an allowance trading system that puts a price on emissions, fixed caps cannot provide the 

incentives for the necessary technological change to occur. Thus, efforts to address 

climate change by imposing costly caps or taxes in the near-term will fail to provide 

long-term reductions. Additionally, if the R&D externality is being effectively addressed, implementation today of a cap or tax that will not become stringent until 

a later date will provide little or no further benefit in the form of an ‘‘announcement 

effect.’’ The only role for near-term GHG caps or taxes would be to achieve emissions 

reductions that are justifiable immediately because their cost per ton removed is 

less than the present value of the cost of avoided future emission reductions that 

would come from the future technologies, once they become available. Any other degree of stringency is unwarranted before R&D is successful, and unnecessary to supplement policies that will address the fundamental market failures associated with 

R&D. 

Announcements of high future carbon prices to stimulate R&D are not credible, because those carbon prices would not be necessary once technologies are developed.8

When new technology and new capacity investments are the issue, the only policy 

strategies that matter immediately are those that will increase incentives to invest 

in R&D, and direct the R&D toward technologies that will create a much larger supply of carbon-free energy alternatives at acceptable costs. Therefore, the only attribute of a cap-and-trade program that will matter will be the future course of the 

cap and its implications for future allowance prices. 

None of the ‘‘mandatory’’ programs under consideration could stimulate the kind 

of R&D in new energy technologies that is required. The ‘‘safety valve’’ in the NCEP 

program and Senator Bingaman’s amendment is designed to provide assurance that 

the price of emission allowances will not reach economically unsustainable levels. 

But that policy design causes the prices to be set at a level far too low to provide 

an adequate incentive for private investors to develop radically new technologies. 

To motivate the large R&D investments required, it would be necessary for governments to announce policies that will lead to high enough implicit taxes on carbon 

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9Such policies are discussed at greater length in W. David Montgomery & Sugandha D. 

Tuladhar, ‘‘Impact Of Economic Liberalization On GHG Emission Trends In India,’’ Climate Policy Center, May, 2005.

emissions to provide an adequate expected return on R&D investment. This tax will 

necessarily exceed the tax needed to induce adoption of the technology once it is developed. Once affordable technologies are produced, a relatively low carbon tax price 

will be enough to motivate companies to adopt the new technologies. That lower carbon price will not be enough to compensate the investors who paid for the R&D, 

but it will be enough to get it utilized. 

Even if laws passed today served to announce a future emissions tax high enough 

to create such an incentive, no future Congress or Administration would keep that 

commitment once the technology was developed. As in the case of patents, there is 

a tradeoff between efficiency in resource allocation and providing an incentive for 

R&D. A carbon price above the level necessary to induce adoption of the new technology will cause avoidable deadweight losses as all energy supply and use decisions 

are distorted. Reducing implicit carbon taxes to the lowest possible level to get the 

new technology deployed will always be beneficial to the economy. Therefore, future 

governments will face irresistible pressure to let the implicit tax on carbon emissions fall back to a level just sufficient to get the R&D utilized, taking away all the 

rewards to innovation. 

This leads to a fundamental dynamic inconsistency that makes any effort to set 

emission caps or announce future carbon prices sufficient to stimulate R&D not 

credible. Since private investors can understand this is the optimal strategy for government—and indeed would likely be skeptical of the political ability of any government to proceed with what will look like ‘‘corporate welfare’’—they will not be motivated to invest in R&D by any announcement of future climate policy. 

C. Design of technology policy 

What this argument demonstrates is that it is not possible to rely on caps on future emissions, or on announcements of a safety valve or carbon tax, to motivate 

R&D to develop the new technologies needed for long-term reduction of climate risk. 

This means that there is an extraordinarily high priority to designing effective programs to stimulate that R&D through incentives provided today. I would urge Congress to turn its interest in climate policy toward a subject it knows well—how to 

craft a program that will lead to effective use of private and government funds to 

carry out the R&D needed to provide the radically new technologies required to stabilize concentrations of greenhouse gases and ultimately, global climate. 

D. Large opportunities for near-term emission reductions exist in developing 

countries 

For near-term emission reductions, developing countries offer far larger and more 

cost-effective opportunity for emission reduction that mandatory emission limits on 

U.S. businesses and consumers. There are a number of ways in which the U.S. Congress could act to increase technology transfer and encourage foreign investment in 

developing countries, and these actions could lead to near-term reductions in emission larger than any of the mandatory limits on U.S. emissions under considerations. 

The provisions of the McCain/Lieberman and Bingaman Amendment proposals 

dealing with developing countries create no mechanism for bringing about changes 

in those countries. A great deal of the difference in greenhouse gas intensity between developing countries and industrial countries can be explained by fundamental failures of markets and institutions in developing countries. Much more costeffective emission reductions are possible in the near-term through programs directed at developing countries by focusing on fundamental institutional and market 

reforms to create the property rights and investment climate required for private 

foreign direct investment and technology transfer.9 These needs are already a focus 

of the Climate Change Title (Title XVI) of the Energy Policy Act of 2005, which 

passed into law after the Bingaman Amendment was released. I believe that approach of Title XVI should be followed, and further enhanced if necessary. The more 

general and less focused provisions expressed in the Bingaman Amendment proposal are unnecessary additions, and could distract from implementing the more focused provisions that already exist as law. 

The CHAIRMAN. Thank you very much, doctor. 

Mr. Grumet. 

94

STATEMENT OF JASON S. GRUMET, EXECUTIVE DIRECTOR, 

NATIONAL COMMISSION ON ENERGY POLICY 

Mr. GRUMET. Thank you, Mr. Chairman. My name is Jason 

Grumet and on behalf of our bipartisan membership of our Commission I want to thank you. I want to thank Senator Bingaman 

and the rest of the committee for the attention you have given to 

this issue and our proposal—why do I not start again. 

What you missed, Mr. Chairman, was largely me thanking you, 

so I would like to repeat that if I might, which was to thank you 

for the attention that you brought to this topic and our proposal 

and also for having not only the hearing on climate science, but 

this follow-up hearing. 

Let me just begin by directly embracing I think the way that you 

laid out the criteria for success, because I think we agree fundamentally that the details are very important, that this is not 

easy, that to succeed we must establish a program that is going to 

achieve the greatest reduction at the lowest cost. It must be economically efficient, it must be fair, it must protect our economic vitality, our economic competitiveness. It must also instill the desire 

for a global and truly effective solution. 

These are the criteria, Mr. Chairman, that I think are clearly expressed in the sense of the Senate resolution. They are also the criteria which explicitly animated the Energy Commission’s policy approach of trying to combine a modest carbon price and augment 

that with the technology incentives that could bring technologies 

forward in a timeframe that this challenge requires. 

Now I want to just talk for a moment about our overall architecture and then move to the costs and benefits of our proposal. By 

and large, our goal was to establish a robust architecture that 

could evolve over time as our understanding of science progresses, 

as actions of other countries progress, but explicitly to establish a 

modest initial cost. We achieve that by suggesting a mandatory 

economy-wide system of market-based regulations. The goal there 

is to maximize efficiency and also to encourage the private sector 

to innovate, which of course we have found is always the ultimate 

solution to these kinds of challenges. 

Equally important, Mr. Chairman, we propose a very gradual reduction target and we propose a cost certain, cost cap, to protect 

our economy against uncertainties that I think we all fear. 

Finally, we believe that a modest carbon price, of course, is not 

in and of itself going to be adequate to bring forth these technologies and we explicitly propose to augment this modest marketbased system with a continued active effort on the part of government to advance these technologies. 

Finally, we propose that our policy be explicitly linked to the actions of our key trade partners, China, India, and developing countries. 

Now let me turn, as this is an economically focused hearing, to 

the costs and benefits. I would suggest to you that there is actually 

surprising agreement on the costs of our proposal. Dr. Smith and 

Dr. Montgomery of Charles River Associates provided the economic 

modeling that we used in our report to express our sense of the 

projected costs and benefits and caused us to conclude that we 

thought the benefits were quite modest. Dr. Gruenspecht and the 

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good people at EIA have done a follow-up analysis which in many 

ways has eclipsed our own. 

Just let me try to put this in perspective, because the economy 

is a very big place, so very small effects taken out of context can 

be somewhat misleading. The EIA suggests that due to the imposition of our mandatory economy-wide carbon program gross domestic product in the United States between 2005 and 2025 will grow 

by 80.6 percent as opposed to 80.8 percent. If I can pull my favorite 

quote out of the report—and Dr. Gruenspecht, they are practiced 

in not using adjectives, but I found this quote helpful. It says: ‘‘The 

overall growth rate of the economy between 2003 and 2025 in 

terms of both real and potential GDP is not materially affected by 

the commission proposal.’’

Put another way, Mr. Chairman, our Nation will be as wealthy 

on January 15, 2025, as we would otherwise be on January 1, 2025, 

as a result of the costs of this program. 

Now, the numbers I agree are less, I think, instructive than the 

overall frame, and simply I would suggest that the dire suggestions 

of economic impacts that have framed our Kyoto debate simply do 

not obtain here. Coal is not driven from the economy. Coal use in 

fact continues to increase, as Dr. Gruenspecht said, part of the reason why the United Mine Workers have endorsed this proposal. 

Natural gas demand does not skyrocket. In fact, as Dr. 

Gruenspecht indicated, it ultimately goes down, and if you focus 

just on the carbon program it increases by no more than 1 percent. 

The economic dislocations that we have all feared simply do not appear. 

I think a lot of that comes to bear on the cost certainty our program provides. It has gotten us out of this ‘‘my modeler is smarter 

than your modeler’’ debate that causes this dramatic gap in people’s different projections. 

But now let me turn a little bit to benefits, because, while the 

costs have clarified, I think there is a growing disagreement among 

experts about the benefits and the logic of combining the market 

program with an incentive program. Predictably, the environmental community has concluded that our $7 a ton initial carbon 

price is not enough and business and trade associations have suggested that it is too much. I credit Dr. Smith with the I think creative argument, if I understand it, that it is at once not enough 

and too much, which I think raises the complexity of the debate 

quite a bit. 

But our Commission by and large avoids extremes and I think, 

like democracy itself, it is best useful to compare this combined approach in the comparison to alternatives. Our alternatives are 

quite simple. We can either put the entire burden on the private 

sector—a market signal is a good thing, but I think most agree 

that Kyoto was too much of a good thing. By placing the entire burden on the private sector, we have unacceptable costs, unacceptable 

dislocations, and we fail to address the long-term market failures 

that Dr. Smith addressed through R&D. 

But conversely, placing the entire burden on the public sector, 

which I think is a fair description of the status quo, where we raise 

tax revenues for big government programs to choose the right technologies, is simply not the way we have learned to solve problems 

96

in this country. It provides no incentive for private sector innovation, no incentive to deploy technologies. Even if the taxpayers support the full cost of deployment, if the costs of venting a ton of carbon to the atmosphere there is simply no incentive to bring these 

technologies forward. 

Finally, I think I am personally leery of Apollo metaphors that 

suggest big government spending, absent any particular strategy to 

suggest how much money, how it will be spent, ultimately who is 

going to raise that money. Fundamentally, it is the marketplace 

and not any of us, no matter how well intentioned or expert, that 

must ultimately decide how to move these technologies forward. 

So in closing, let me just contrast I think the extremes with the 

benefits of a balanced system. The combination of a modest cost 

price on carbon and a technology program provides real near-term 

reductions. Our proposal is anticipated to reduce the growth in annual greenhouse gas emissions by two-thirds over the next decade, 

allowing us then to move into ultimately a cap and a reduction. 

Early market signals avoid locking in bad investments and, contrary to Dr. Smith’s expectations, it was the CEO’s on our commission, the people who actually make billion dollar long-term investments, who were strongest of the view that a modest market signal 

now would have dramatic long-term impacts on their ideas and 

challenges. 

It is an equitable approach, Mr. Chairman, because it shares the 

burdens. Someone is going to have to pay for this technology and 

it shares the burdens between the public sector and shareholders. 

Mr. Chairman, while I think our Commission was a bid prudish 

in our interest in not exceeding or spending money that we do not 

have, it provides an opportunity to actually generate revenue so 

that you can move these technologies forward in a revenue-neutral 

way. 

Finally, Mr. Chairman, it allows us to establish our international 

leadership. We all agree that we cannot solve this problem absent 

commensurate and real efforts by China and India. We need to establish our opportunity to work with those countries more aggressively than we can right now. It is clear that we cannot in the 

United States solve this problem absent participation by those 

other countries. I think it is equally true that the rest of the world 

cannot solve this problem absent the leadership of the United 

States. 

Thank you for this opportunity and we offer whatever our Commission can do as you address these difficult issues in the time 

ahead. 

[The prepared statement of Mr. Grumet follows:]

PREPARED STATEMENT OF JASON S. GRUMET, EXECUTIVE DIRECTOR,

NATIONAL COMMISSION ON ENERGY POLICY

Good morning, Chairman Domenici and Members of the Committee, and thank 

you for holding this hearing to explore the benefits and economic impacts of approaches to reduce greenhouse gas emissions. I speak to you today on behalf of the 

National Commission on Energy Policy, a diverse and bi-partisan group of energy 

experts that first came together in 2002 and last December issued a comprehensive 

set of consensus recommendations for future U.S. energy policy. 

I would like to begin by commending Chairman Domenici and Senator Bingaman 

and many others on this Committee for their leadership in winning Senate adoption 

of a landmark resolution recognizing the importance of the climate problem and, for 

97

the first time, putting this body on record in support of the need for mandatory efforts to reduce greenhouse gas emissions. I believe that in years to come, passage 

of this resolution will come to be seen as a pivotal moment in the evolution of our 

collective response to the risks posed by climate change. 

The resolution marks a turning point, but it also represents a logical next step 

for the Senate on this issue. When the Senate last expressed its views on climate 

change—in the Byrd-Hagel resolution of 1997—it set out two basic criteria for future U.S. climate policy that continue to serve as critical guideposts for our discussions today. The first criterion is that any efforts to combat climate change must 

not compromise the vitality or competitiveness of the U.S. economy. The second criterion is that all nations, and particularly developing nations with rapidly growing 

emissions, must also act to address this problem. As we heard from the panel of 

distinguished scientists who testified before this Committee in July, the scientific 

consensus about climate change has steadily strengthened over the last decade. 

While a majority of Senators have now agreed that it is time to act, Senators on 

this Committee have clearly expressed a shared view that the solution to this global 

problem will not come easily. It was also widely and correctly noted at the previous 

hearing that mitigating the risks from global warming will require the deployment 

of an array of clean energy technologies, many of which have not been commercialized or even invented. The challenge before us is to determine the most effective 

and efficient means of developing and deploying these new technologies while satisfying the criteria articulated in both the Byrd-Hagel and the more recent BingamanDomenici resolutions. 

Our group, the National Commission on Energy Policy, has developed an approach that we believe can reduce domestic emissions, spur technology development 

and meet the twin tests of economic responsibility and international equity. 

But before outlining key elements of that approach, let me say a few additional 

words about the Commission itself. The Commission was formed in 2002 by the 

Hewlett Foundation and several other private, philanthropic foundations. Its ideologically and professionally diverse 16-member board included recognized energy experts from business, government, academia, and the non-profit sector. Our final recommendations, which are described in a report that was released on December 8, 

2004, were informed by intense discussions over several years, by dozens of analyses 

contained in a 2,800 page Technical Appendix, and by extensive outreach to over 

200 other groups. Those recommendations, I should stress, deal with a comprehensive set of energy policy issues including (in addition to climate change) our nation’s 

dependence on oil and the need for increased investment in new energy technologies 

and critical energy infrastructure. 

As a group, however, we recognized from the outset that climate change presented 

one of the central energy challenges of our time and so we devoted considerable energy to developing a detailed set of recommendations for addressing this issue. I 

would like to begin my remarks by summarizing the Commission’s view that volunteerism and tax-payer supported incentives alone do not provide an effective or 

economically efficient response to this challenge. After explaining our support for 

mandatory market-based limits to slow, stop and ultimately reverse the growth of 

greenhouse gas emissions, I will focus on the attributes of a mandatory program 

that are needed to protect our economy. 

The Imperative of Mandatory Action—Our Commission strongly supports the need 

for continued government efforts to accelerate the development and early deployment of low and non-carbon energy sources. We applaud the Administration’s efforts 

in this regard. However, in a competitive market-economy, where companies are encouraged and in some cases obligated to maximize shareholder value, it is contrary 

to the rules of free-market competition to expect companies to invest scarce resources absent a profit motive. While there are numerous cases where a combination of good will, good public relations, and positive ulterior motives (like reduced 

energy bills), create an adequate basis to reduce greenhouse gas emissions, these 

cases will remain limited if the financial value of reducing a ton of GHG emissions 

remains zero. 

It is somewhat ironic that the European Union is actively implementing marketbased regulatory approaches developed here in the Unites States while we pursue 

a top-down program of government-directed, tax-payer funded research and deployment incentives. Developing and commercializing new technologies will cost money. 

The question is who is best positioned to secure and effectively spend these resources. While there is certainly a role for public funding and government incentives, the Commission believes. that there must also be a role for those who emit 

greenhouse gases to share in the costs of developing solutions. As we have learned 

over the last twenty years, given a rational reason to invest, the private sector is 

far better than the government in developing technological solutions. The success 

98

of the acid rain program demonstrates that the most effective way to engage the 

ingenuity of the private sector is to place a monetary value on a ton of reduced 

emissions thus creating a real economic incentive to develop cleaner forms of energy. By imposing a modest market signal to pull private sector technology investment forward in combination with continued tax-payer supported investment to 

push longer-term solutions, the Commission believes we can significantly reduce 

GHG emissions without hampering economic growth or prosperity. 

Many in the environmental community and some industry analysts have argued 

that the modest-market signal proposed by the Commission is inadequate, in and 

of itself, to spur the technology innovation needed to solve the climate problem. The 

Commission wholeheartedly agrees. While modeling performed by Charles Rivers 

Associates under contract to the Commission and by the Energy Information Administration demonstrates that a modest carbon price will inspire considerable nearterm reductions, both analyses conclude that.proposed market-signal is unlikely by 

itself to make technologies such as carbon sequestration, a massive deployment of 

renewable energy generation, or advanced nuclear facilities cost-competitive over 

the next two decades. This conclusion is precisely why the Commission believes that 

an effective response to climate change requires both a market signal and significant technology incentives. 

This basis of this conclusion is best revealed by examining the alternatives. While 

providing a strong incentive for technology development, imposing a much higher 

carbon price on corporations and share-holders would be economically disruptive 

and politically unacceptable. This approach would strand billions of dollars of existing, long-lived capital stock and cause potentially significant economic dislocations 

while new technologies were developed and deployed. It also fails to address widely 

accepted market failures that discourage the investment of private capital in the development of long-term technologies with uncertain market value. Conversely, the 

placing the entire burden on the public sector is equally unacceptable. By discouraging private investment and innovation, this approach will ultimately prove ineffective, too costly to the Treasury or both. Moreover, absent a market signal, there 

will be little or no incentive to deploy low carbon technologies even if the tax payer 

covers the full cost of their development. In sum, relying entirely upon the private 

or public sectors to advance our national interest in technology advancement, offers 

a policy prescription that is akin to pushing one-end of a rope. 

The elegance of combining a both market signals and public incentives is further 

supported by the opportunity to auction a small fraction of the emission permits in 

order support technology innovation without burdening the general tax base. The 

Commission proposed to double U.S. energy R&D, triple international energy R&D 

partnerships, and provide significant incentives to accelerate the deployment of coal 

gasification and sequestration, bio-fuels, renewable generation, domestically produced efficient vehicles and advanced nuclear facilities using the $35 billion in revenue generated by auctioning up to 10% of the emission permits over a decade. 

Overview of Commission Proposal—In addition to advocating for the combination 

of a market-based price signal and technology incentives, the Commission’s proposal 

is explicitly designed to ensure that the proposed market-based emission reduction 

requirements do not undermine economic growth or competitiveness. Specifically, 

the Commission recommends that the United States adopt a mandatory, economywide, tradable-permits system for reducing greenhouse gas emissions, with a safety 

valve designed to limit costs. This approach is similar to the successful acid rain 

program in the United States, but differs in one very critical respect. Rather than 

proposing a hard cap on emissions, we have proposed an absolute cap program costs. 

The aim of the Commission’s proposal is to slow growth in U.S. emissions over 

the 2010-2020 timeframe as a prelude to stopping and eventually reversing current 

emissions trends in the 2020s and beyond. We also explicitly designed our approach 

to recognize the importance of participation by major trading partners like China 

and India. Our program includes a regular 5-year review of progress which is intended to assess both the performance of the U.S. program and progress by other 

countries. If major U.S. trading partners and competitors (including China, India, 

Mexico, and Brazil) fail to implement comparable emission control programs, further 

U.S. efforts—including the gradual increase in stringency built into our program—

could be suspended or adjusted. Conversely, the U.S. program could be strengthened 

if international progress, technology advances, or scientific developments warrant. 

International participation and other issues will be the subject of future hearings, 

so I want to return now to the main focus of this panel: economic impacts. 

Two key policy choices: 1) a modest reduction target; 2) the cost-cap or ‘‘safetyvalve’’ enable the Commission to propose a mandatory, economy-wide GHG reduction program that according to EIA does not ‘‘materially affect,’’ the U.S. economy. 

I will describe each of these design features in turn. 

99

Modest Reduction Target—The Commission believes that if we begin now, there 

is time to gradually phase-in GHG reductions across the economy. Like the Administration, we believe that reducing the GHG intensity of the economy is an effective 

means of slowing, stopping and ultimately reducing U.S. GHG emissions. Over the 

first decade of the program, we propose to set an economy-wide emission limit based 

upon a 2.4% decrease in GHG emission intensity. If achieved, this target would slow 

annual emissions growth by roughly 2⁄3 from business as usual allowing actual emissions to increase by 0.5% per year instead of by the currently projected 1.5% annual 

increase in total emissions. Absent Congressional intervention to adjust the target, 

the intensity decline would increase to 2.8% after a decade effectively stopping emissions growth. Many have argued that this reduction pathway is too slow and criticize the Commission plan for explicitly allowing emissions to increase for a decade 

after implementation. We acknowledge this critique, but believe that a modest and 

low-cost reduction pathway is critical to achieving the near-term consensus needed 

for timely action. The Commission believes that it is critical for the United States 

to move forward now to implement a robust regulatory architecture that can adjust 

over time as our understanding of climate impacts and the costs of solutions matures. 

Cost-Certainty (the ‘‘Safety-Valve’’)—Under a traditional cap and trade program 

the reduction target is fixed in statute or regulation while the costs are ‘‘best guesses’’ of what will be necessary to achieve the fixed targets. While our experience in 

the acid rain program suggests that projected costs are more likely to be exaggerated than understated, there remains a real possibility that costs for meeting any 

target will be higher than expected or desired. Under the safety-valve, regulated entities are allowed to buy additional permits from the government at a pre-determined price. This feature of the Commission’s proposal ensures that program compliance costs will not exceed estimates. If technology fails to progress at the projected rate, the program will reduce less emissions than desired but compliance 

costs will not increase. 

EIA’s analysis and the work of Charles River and others reveal that expectations 

of technological progress are by far the most significant assumptions affecting the 

costs of achieving a particular emissions target Under EIA’s base-case average technology assumptions achieving the Commissions modest 2.4% annual intensity reduction will begin to cost more than the safety-valve price beginning in 2015 causing 

firms to avail themselves of safety-valve permits. However, when EIA projects costs 

using more optimistic assumptions about technology progress that seek to capture 

the Commission’s ‘‘recycling’’ of auction revenue back into technology incentives, the 

target is met throughout the first decade with the safety-valve never being triggered 

at all. Under the more optimistic technology assumptions, a $7/ton incentive results 

in nearly double the reductions, but the overall cost of the program is the same. 

The Commission’s decision to place a priority on cost-certainty over emissions certainty reflects our appreciation of strongly held and fundamentally irresolvable disagreements about technological progress and the ultimate costs of emission reductions. Rather than spending several more years paralyzed by differing climate 

change modeling assumptions, the safety-valve allows us to begin, albeit cautiously, 

to reduce U.S. greenhouse gas emissions while protecting our economy, affording 

time for key industries to adjust and maintaining America’s global competitiveness. 

The safety valve also gives businesses the planning certainty they need to make 

wise long-run investments that will minimize the costs of achieving greenhouse gas 

emissions reductions over time. We chose an initial safety valve level of $7 per metric ton of carbon dioxide equivalent because analyses suggest that it roughly reflects 

the mid-point in the scientific literature of the expected harm that can presently be 

attributed to a ton of GHG emissions given current scientific understanding. Equally if not more important, the $7 figure is low enough to ensure that valuable, longlived energy assets won’t be prematurely retired, yet also high enough to send a 

meaningful market signal for future investment in clean, low-carbon energy alternatives. In our proposal, the safety valve price increases gradually over time, at a 

nominal rate of 5 percent per year, to generate a steadily stronger market signal 

for reducing emissions. 

Overall Economic Impacts—To assure ourselves that we had successfully addressed potential economic concerns, we subjected our proposal to detailed economic 

analysis. The analysis indicated that the impacts of the program on businesses and 

households would be modest. Our own modeling results were subsequently supported by an independent analysis of our proposal by the Department of Energy’s 

Energy Information Administration (EIA). 

EIA’s analysis indicates that the impacts of the program on businesses and households are likely to be modest. Projected annual GDP growth would decline by less 

than .02% against a baseline average growth or 3.1%. This impact equate to an avVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00103 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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erage annual cost of $78 per household between program inception and 2025. Assessed cumulatively between 2005 and 2025, overall, predicted GDP growth would 

change from 80.8 percent to 80.6 percent, or a difference of 0.2 percent. In the EIA’s 

own words: ‘‘the overall growth rate of the economy between 2003 and 2025, in 

terms of both real GDP and potential GDP, is not materially altered.’’ Put another 

way, the nation would be as wealthy on January 15, 2025 with the program in 

place, as it would have been on January 1, 2025 under business as usual. At the 

relatively minor cost of slowing economic growth by two weeks twenty years hence, 

we can make a significant start to address global climate change. 

Because the models predict that a large share of reductions in the early years of 

the program would come from industrial greenhouse gases such as HFCs, PFCs, and 

SF6, total energy consumption would be expected to decline by only 1 percent below 

forecast levels for 2020, while still growing 14 percent in absolute terms over the 

first decade of program implementation (i.e., 2010-2020). Also noteworthy, natural 

gas demand is barely affected by the Commission’s climate proposal increasing by 

less than 1% over business as usual. When additional proposals to increase energy 

efficiency and support coal gasification are modeled, total natural gas demand actually declines against business as usual projections. Finally, while coal use grows 

more slowly than under BAU, significant growth in coal is projected by both the 

Commission and EIA’s analysis even when excluding new markets that will be created by IGCC. 

Of course, a very small fraction of a very large economy can still look like a lot 

of money if taken out of context. You will undoubtedly hear from critics that our 

proposal will cost $313 billion in lost GDP between 2005 and 2025. What the critics 

are less likely to mention is that this is just a tiny fraction of the $323 trillion of 

cumulative growth in GDP the economy is expected to generate over the same time 

period. Similarly, those who oppose any action on climate change are likely to point 

to EIA’s estimate of 140,000 lost jobs by 2020 as a result of the tradable permits 

program. Again, this number needs to be viewed in context. EIA’s estimate of job 

losses comes to just 0.4 percent of the 36 million new jobs that the economy is expected to create between 2005 and 2025. 

At Chairman Inhofe’s request, EIA also recently examined the impacts of the program assuming higher natural gas prices and higher costs for reducing emissions 

of non-CO2 greenhouse gas emissions. EIA found that the costs of the Commission’s 

proposal would actually be less if natural gas prices turned out to be higher than 

projected. Higher natural gas prices under business-as-usual assumptions would 

tend to lower total demand for energy, thus making it somewhat easier to meet the 

Commission’s proposed emission target. While more pessimistic assumptions regarding the costs of controlling non-CO2 greenhouse gas emissions would result in lower 

total reductions of greenhouse gas emissions, they would not materially affect program costs. This recent analysis makes clear the value of the safety-valve both as 

a substantive protection in case 2005 economic assumptions are not borne out over 

time and as a political device to set aside some of the more contentious and unknowable ‘‘what if’’ arguments that have undermined our ability to forge a consensus for 

mandatory actions to reduce GHG emissions. 

The trade-off for low cost is a program that also achieves relatively modest emission reduction benefits, at least in its early stages. We believe that a flexible, gradual, market-based approach that provides cost certainty is appropriate at a time 

when uncertainties remain about the pace of actual warming and about the speed 

with which we can develop and commercialize lower-carbon alternatives. While this 

program will necessarily need to evolve as other nations join in the reduction effort 

and as our understanding of the climate induced impacts continues to improve. We 

believe that it is the right approach to get us started. 

In fact, the importance of getting started is exactly what I hope you will not lose 

sight of as the inevitable debate about numbers and dollars and tons and jobs 

unfolds in the months to come. A war of numbers too easily leads to paralysis. And 

right now it matters less which numbers you choose than that you recognize the 

essential principle at the core of our proposal: Strictly voluntary, seemingly costless 

approaches will not enable the marketplace to attach a known value to carbon reductions. Only when reductions have real value—however small—can companies 

justify long-term investments in new, low-carbon energy alternatives and only then 

will we unleash the ingenuity and innovation of the private sector in addressing the 

climate change problem and in developing the clean technologies that will be in 

global demand for decades to come. 

Finally, the Commission firmly recognizes that climate change is a global problem 

requiring an effective and equitable global solution. The United States can not 

meaningfully mitigate the risks of climate change absent commensurate efforts by 

the rest of the world. Similarly, the rest of the world can not solve the climate probVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00104 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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lem absent leadership from the United States. The Commission believes that undertaking mandatory domestic reduction efforts here at home is a condition precedent 

to achieving a truly global solution. This recognition that actions in the developing 

world will inevitably follow those of the United States provides further impetus to 

take action now so that we can work more effectively to encourage similar actions 

overseas. 

Thank you for this opportunity to testify. I speak on behalf of the entire Commission in offering whatever further support and information we can provide to assist 

your deliberations in the months to come. 

SUMMARY OF KEY FEATURES OF THE NATIONAL COMMISSION ON ENERGY POLICY’S

PROPOSAL FOR REDUCING GREENHOUSE GAS EMISSIONS

• Mandatory, economy-wide, tradable permits system would go into effect in 2010. 

This would allow U.S. companies adequate lead time to plan and make needed 

adjustments or investments. The program would cover carbon dioxide (CO2) and 

other major greenhouse gases (including methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride). 

• Environmental target based on annual reductions in emissions intensity, where 

intensity is measured in tons of CO2-equivalent emissions per dollar of GDP. 

Between 2010 and 2019 the Commission recommends a target emissions intensity decline of 2.4 percent per year. Based on current GDP forecasts, achieving 

this target would reduce projected emissions growth from a business-as-usual 

rate of 1.5 percent per year to 0.5 percent per year. Starting in 2020 and subject 

to the Congressional review described below, the Commission proposes raising 

the target intensity decline to 2.8 percent per year (the ‘‘stop phase’’ in the figure). 

• Cost cap is achieved by making additional permits (beyond the quantity of permits established through the target intensity decline described above) available 

for purchase from the government at a pre-determined price. The Commission 

proposes an initial cost cap or ‘‘safety valve’’ permit price of $7 per metric ton 

of CO2-equivalent. This price would increase by 5 percent per year in nominal 

terms. 

• Permit allocation for a given year would be calculated well in advance based 

on available GDP forecasts. For the first three years of program implementation, the Commission recommends that 95 percent of initial permits be issued 

at no cost to emitting sources. The remaining 5 percent would be auctioned. 

Starting in 2013 and every year thereafter, an additional 0.5 percent of the target allocation would be auctioned, up to a limit of 10 percent of the total permit 

pool. 

• Congressional review in 2015 and every five years thereafter to assess the U.S. 

program and evaluate progress by other countries. If major U.S. trading partners and competitors (including China, India, Mexico, and Brazil) fail to implement comparable emission control programs further U.S. efforts (including continued escalation of the safety valve price and permit auction, as well as more 

aggressive intensity reduction target in 2020) could be suspended. Conversely, 

the U.S. program could be strengthened if international progress, technology advances, or scientific developments warrant.

The CHAIRMAN. Thank you. 

Dr. Morgenstern. 

STATEMENT OF RICHARD D. MORGENSTERN, PH.D., ECONOMIST AND SENIOR FELLOW, RESOURCES FOR THE FUTURE 

Dr. MORGENSTERN. Thank you, Mr. Chairman. Mr. Chairman, 

Senator Bingaman, members of the committee, I appreciate the opportunity to appear here today. I am an economist and senior fellow at Resources for the Future, a 53-year-old nonpartisan think 

tank based here in Washington. The views I present are strictly my 

own. 

I begin by observing what many press reports have failed to note, 

that proposals such as those advanced by the NCEP differ dramatically from the Kyoto Protocol. Whereas Kyoto sought significant 

near-term reductions, NCEP is designed not to avert climate 

102

change over the next 20 years. Rather, its principal aim is to develop and deploy new technologies to address the problem in the 

decades ahead. 

Recent EIA analyses, which we have already heard from Dr. 

Gruenspecht on, clarify the differences. I have a table in my testimony that demonstrates this clearly, but looking at several analyses conducted by EIA over the past several years, the differences 

are striking between NCEP and Kyoto. What you find is that the 

reductions are only about one-fifth as much as those proposed 

under Kyoto in NCEP, allowance prices in 2020 are about eight 

dollars a ton of CO2, and although there is a small decline compared to the forecast level, coal use actually increases 14 percent 

over the current levels. The overall economic impacts measured in 

terms of potential GDP are about one-eighteenth as much as the 

Kyoto Protocol. 

The NCEP approach relies on market-based policies, in this case 

a cap-and-trade mechanism, with a safety valve or price cap, combined with a set of direct subsidies to new technologies. The revenues are derived from a sale of a small portion of the allowances. 

Thus the NCEP proposal is revenue neutral. 

Market-based mechanisms of this sort have two distinct effects. 

On the one hand, they create incentives to reduce emissions in the 

near term, thus mitigating environmental damages associated with 

those emissions. Second, they alter incentives for the private sector 

to develop and adopt new technologies. In fact, few would disagree 

that it is the private sector, not the Government, which has driven 

innovation and growth in our society. According to the National 

Science Foundation, for example, industry funded about two-thirds 

of the research and development in this country in 2003. 

While anecdotal evidence on the private sector contribution is extensive, I would call your attention to a recently published scholarly paper by David Popp. It documents that following the passage 

of the Clean Air Act in 1990, which for the first time put an incentive on the development of technologies which would reduce emissions beyond the targeted level, that the level of patent activity for 

these particular types of innovations which increased the effectiveness, the environmental effectiveness of these technologies, increased. Heretofore the emphasis in new patents had been focused 

principally on only cost-reducing technologies, but it was this emphasis on environmentally friendly reductions which was induced 

as a result of the Clean Air Act. 

At the same time, there is an important role for government 

clearly in encouraging the development of new technologies, based 

largely on the spillovers and externalities associated with innovations. The existence of these spillovers reduces the private incentives to pursue innovation as others will mimic these initial innovations without compensating or fully compensating the inventors. 

Patents offer some protection, but that is limited. Learning by 

doing creates additional benefits for society from the early adoption 

and diffusion of these technologies. 

While the rationale for government support of research and development and demonstration is quite strong, such programs cannot do the job completely by themselves. For example, governmentfunded technology programs may succeed in bringing down the cost 

103

of promising technologies, like IGCC, so that they will eventually 

overtake conventional pulverized coal technologies. 

That said, how can technology programs ever make capture and 

sequestration cheap enough so that firms will voluntarily undertake such efforts? To accomplish sequestration, some form of mandatory government policy is going to be required. The real choice 

is between a command and control approach and a market-based 

approach. NCEP has wisely chosen a market-based approach to encourage this near-term mitigation. 

Now, those who oppose a mandatory program fail to recognize 

several points. First, the signal that it sends to firms and households, especially in their investment decisions for long-lived equipment, like power plants, homes, and many appliances. Second, the 

value of cheap near-term reductions in buying time for further 

R&D on these new technologies. Third, the opportunity to encourage a broad set of technologies, not just the winners picked by the 

Government program. 

Virtually all economists recognize the rationale for some form of 

mandatory program. Arguably, there is a disagreement about the 

extent of the disincentive for carbon emissions that should be imposed in the near term. The NCEP recommendation of $7 a ton of 

CO2 is quite consistent with the estimates found in the economics 

literature on this point. 

Let me now turn to a further discussion of the safety valve. As 

has been noted by others, it is in effect a type of insurance designed to protect the economy against unexpected price increases 

caused by weather, stronger than predicted economic growth, technology failures, or other factors. Despite the success of the cap-andtrade approach without the safety valve in the acid rain program, 

problems have arisen in some other arenas. 

For example, during the California energy crisis the price of NOX

permits rose to about $80,000 per ton. More recently, in the early 

phase of the European Union trading system prices have moved 

around fairly dramatically. Canada, our neighbor to the north, has 

included a safety valve in its recent proposals on climate change. 

Now, differences among forecasters have plagued previous policy 

proposals. Back in 1997, the Council of Economic Advisers forecast 

prices below the equivalent of $8 per ton of CO2, compared to EIA’s estimate of $43 per ton of CO2. With a safety valve, emissions estimates may vary, but costs cannot rise above the established price. 

Some in opposing the safety valve try to label it as a disguised 

tax. In this regard I would make two points. First, if the price cap 

is not reached then it is strictly a cap-and-trade mechanism, just 

like the acid rain program. However, even if the price cap is 

reached, only a very small portion of the revenues flow to the government, in this case to fund the R&D. The bulk of the revenues 

flow directly back to the private sector. Since a tax is principally 

defined in terms of the revenues it generates and since only a 

small portion of the revenues ever end up in the hands of government, it clearly is inaccurate in my judgment to describe it as a 

tax. 

In conclusion, Mr. Chairman, we have come a long way since the 

early discussions on the Kyoto Protocol. We are no longer talking 

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omy. Rather, the debate has now shifted to the appropriate mechanism for motivating both the public and private sectors to pursue 

technology innovation over the long term and capturing the lowhanging fruit of cheap emissions reductions in the short run, all 

the while protecting us from unwarranted economic impacts. 

That completes my initial remarks and I would be pleased to answer any questions. Thank you. 

[The prepared statement of Dr. Morgenstern follows:]

PREPARED STATEMENT OF RICHARD D. MORGENSTERN, PH.D., ECONOMIST AND

SENIOR FELLOW, RESOURCES FOR THE FUTURE

Mr. Chairman, I am pleased to appear before this committee to comment on the 

recently adopted Senate resolution calling for a ‘‘. . . national program of mandatory market-based limits and incentives on greenhouse gases that (1) will not significantly harm the United States economy; and (2) will encourage comparable action by other nations that are major trading partners and key contributors to global 

emissions.’’

To set the context, I will briefly discuss a number of policy developments since 

the late 1990s when the Kyoto Protocol was being negotiated. Then, I will turn to 

some design issues relevant to the implementation of the new Senate Resolution, 

including the mechanisms that will encourage the development and adoption of new 

technologies, and the use of a safety valve or price cap as an integral part of a capand-trade system. Finally, I will comment on possible means of encouraging comparable mitigation actions by other large emitters. 

I speak as an economist who has been involved with the issue of climate change 

for almost two decades. Previously a tenured college professor, I have also had the 

privilege of serving in senior policy positions under prior Republican and Democratic 

administrations. Currently, I am a senior fellow at Resources for the Future (RFF), 

a 53-year-old research institution, headquartered here in Washington, D.C., that 

specializes in energy, environmental, and natural resource issues. RFF is both independent and nonpartisan, and shares the results of its economic and policy analyses 

with members of both parties, as well as with environmental and business advocates, academics, members of the press, and interested citizens. RFF encourages 

scholars to express their individual opinions, which may differ from those of other 

RFF scholars, officers, and directors. I emphasize that the views I present today are 

mine alone. 

Let me begin by observing what many recent press reports have failed to note: 

recent policy proposals, such as those advanced by the National Commission on Energy Policy (NCEP), differ dramatically from the Kyoto Protocol. While the details 

of Kyoto are well known to members of this committee, the NCEP proposal is novel 

in a number of respects, as it combines federal support for innovative technologies 

with a program to reduce greenhouse gas emissions that involves a cap on costs. 

Overall, the NCEP program would have a minimal impact on the U.S. economy and 

is revenue neutral with respect to the federal budget. Whereas the Kyoto Protocol 

involves fairly steep short-term reductions and, correspondingly, potentially high 

costs, the NCEP proposal calls for relatively modest initial emissions reductions 

which are, in fact, quite similar to the voluntary intensity reductions proposed by 

the Bush administration. Because of the more modest start, combined with the safety valve, the costs of the NCEP proposal are much lower. 

To see this point more clearly, consider the results of three separate analyses by 

the independent Energy Information Administration (ETA) of the costs of alternative climate proposals conducted over the past several years. Relying on its standard National Energy Modeling System, ETA compared the effects of implementing 

the Kyoto Protocol, The Climate Stewardship Act introduced by Senators McCain 

and Lieberman (S. 139), and the NCEP proposal. Although the EIA studies were 

conducted in different years, and involve slightly different baselines, the results are 

quite illuminating (see the accompanying table).

105

EIA’s ANALYSIS OF THE KYOTO PROTOCOL, S. 139,

AND ENERGY COMMISSION PROPOSALS: 2020

NCEP S. 139 Kyoto

(+9%) 

GHG emissions (% domestic reduction) ................ 4.5 17.8 23.9

GHG emissions (tons CO2 reduced) ....................... 404 1346 1690

Allowance price ($2003 per ton CO2) .................... 8 35 43

Coal use (% change from forecast) ........................ ¥5.7 ¥37.4 ¥72.1

Coal use (% change from 2003) .............................. 14.5 ¥23.2 ¥68.9

Natural gas use (% change from forecast) ............ 10.6 4.6 10.3

Electricity price (% change from forecast) ............ 3.4 19.4 44.6

Potential GDP (% loss) ........................................... 0.02 0.13 0.36

Real GDP (% loss) ................................................... 0.09 0.22 0.64

SOURCES. 

NCEP: GHG emissions and allowance price is from EIA analysis, Table 118 (May 2005). All 

other data is from Table 1, ‘‘AEO 2005 Reference Case’’ and ‘‘Greenhouse Gas Policy.’’ (EIA, 

April 2005). This is available at www.eia.doe.gov/oiaf/servicerpt/bingaman/index.html.

McCain Lieberman (S. 139): From Analysis of Senate Amendment 2028, the Climate Stewardship Act of 2003. Emissions data and allowance price is from Table B20. GDP is from Table 

B21. All other data is from Table B1. (ETA, May 2004). This is available at www.eia.doe.gov/

oiaf/servicerpt/ml/pdf/sroiaf (2003)02.pdf.

Kyoto Protocol: Impacts of the Kyoto Protocol on U.S. Energy Markets and Economic Activity. Emissions data is from Table B19. Allowance price and GDP is from Table ES-2. All other 

data is from Table B1. (EIA, October 1998). This is available at www.eia.doe.gov/oiaf/kyoto/

pdf/sroiaf9803.pdf.

For the Kyoto Protocol, EIA forecast greenhouse gas reductions of 23.9 percent in 2020. Under Kyoto, allowance prices were predicted to reach $43 per ton of carbon 

dioxide, while coal use was expected to decline by 68.9 percent below 2003 levels. 

Real GDP was forecasted to decline by 0.36 percent. In analyzing the NCEP proposal, EIA foresaw smaller emissions reductions and, most importantly, quite different economic impacts. Allowance prices were effectively capped at $7 per ton of 

carbon dioxide; coal use was forecast to increase by 14.5 percent above 2003 levels 

by 2020, and real GDP losses were considerably smaller (0.09 percent). EIA noted 

that this policy would not ‘‘materially’’ affect average economic growth rates for the 

2003 to 2025 period (p. xi). For McCain Lieberman, EIA forecast impacts that would 

fall between Kyoto and NCEP, although they were considerably closer to Kyoto in 

terms of both emissions reductions and costs. 

The principal reason that NCEP’s approach is so much less costly than Kyoto or 

S. 139 is that it is not designed to avert climate change over the next 20 years. 

Rather, the focus is on developing and deploying technologies needed to address the 

problem in the decades beyond. NCEP does this primarily in two ways: 1) by directly subsidizing a wide range of new technologies including coal, nuclear, fuel-efficient vehicles, biofuels and others; and 2) by encouraging private-sector research 

and development through incentives for the deployment of cost-effective carbon saving technologies of all types. NCEP’s cap-and-trade system has the added benefit of 

generating a revenue stream to fund the technology subsidies. 

It is widely recognized that major progress on climate change will not be possible 

without new technologies. It is also widely recognized that government has an important role to play in spurring the development and diffusion of these technologies. 

Without some kind of additional incentives, the private sector typically will underinvest in research, development, and demonstration because innovators cannot reap 

the full benefits to society of their advances. The existence of these ‘‘spillovers’’ reduces private incentive to pursue innovation, as others will mimic the innovation 

without compensating the inventors. While patents and similar means are used to 

protect investments in innovation, that protection is limited. A successful innovator 

typically captures substantial rewards, but those gains are sometimes only a fraction of the total benefits to society arising from the innovation. This rationale 

underlies government support of research, development, and demonstration programs, including the National Science Foundation, public universities, and others. 

Environmental and knowledge externalities have long been at the center of debates about technology policy. More recently, we have come to understand some additional market failures that may operate in the adoption and diffusion of new technologies. For a variety of reasons, the cost or value of a new technology to one user 

may depend on how many other users have adopted the technology. Generally 

speaking, users will be better off the more others use that same technology, as this 

increases what is known as ‘‘learning by doing’’ and ‘‘network’’ externalities. TypiVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00109 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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1www.nsf.gov/sbe/srs/infbrief/nsf04307/start.htm.

2 Harrington, Winston, Richard Morgenstern and Thomas Sterner. 2004. Choosing Environmental Policy: Comparing Instruments and Outcomes in the United States and Europe Washington D.C.: RFF Press 

cally, it takes time for potential users to learn of a new technology, try it, adapt 

it to their particular circumstances, and become convinced of its superiority. Consequently, the early adopter of a new technology creates a positive benefit for others 

by generating information about the existence, characteristics, and likely success of 

the new technology. 

The argument for public support is even stronger in the case of climate change 

technologies, where not only do inventors fail to capture all the gains from their investments but the gains themselves are not fully translated to the firms’ bottom line 

because there is no market value associated with emissions reductions. Further, the 

prospect of future value—which is driven by policy outcomes—is uncertain. 

Absent government incentives, corporate concern for the environment may overcome some hurdles. Working against this kind of ‘‘corporate altruism,’’ however, is 

the need to compete in the marketplace. A company that puts meaningful effort into 

reducing greenhouse gas emissions, rather than reducing costs, may eventually lose 

out to one that only seeks to reduce costs. 

It is exactly this need to align public and private interests that underlies the argument for an emissions trading program, or similar mechanism, alongside technology development and demonstration programs. While the government seeks technologies to cut carbon emissions, the private sector seeks technologies to cut costs. 

Market-based policies that put a value on emissions reductions encourage firms to 

conserve energy, reduce emissions from existing technologies, and adopt new lowcarbon or no-carbon technologies. In contrast, policies that only focus on technology 

adoption fail to take advantage of reductions that could come from existing technologies and conservation. 

Market-based policies to reduce emissions have two distinct effects: they reduce 

emissions in the near term and they alter the incentives that firms have for developing and adopting new technologies for the future. Few would disagree that it is 

the private sector, not the government, which has driven innovation and growth in 

modern economies. Industry, according to data from the National Science Foundation, funded 63 percent and performed 68 percent of all research and development 

in 2003 (the latest year for which data is available).1 Even as the government tries 

to encourage greenhouse gas-reducing technologies, private efforts to improve greenhouse gas-increasing technologies will likely continue unless firms see some kind of 

value associated with emissions reductions. 

Technology programs alone may succeed in bringing down the cost of integrated 

gasification and combined cycle (IGCC) coal plants so that they eventually overtake 

conventional pulverized coal. That said, how can technology programs ever make 

capture and sequestration cheap enough so that firms will voluntarily capture and 

sequester emissions? The real choice is whether capture and sequestration will 

eventually be required under a command-and-control style regulation, or whether a 

market-based system will be used to flexibly encourage adoption of the cheapest option. There is growing evidence on the performance of these alternative approaches, 

including a volume I recently co-edited which compares the U.S. and European 

records of both command-and-control and market-based mechanisms.2 Overall, the 

analysis finds that market-based programs are considerably cheaper than commandand-control alternatives. For example, the U.S. sulfur dioxide program achieved savings of over 40 percent compared to the command-and-control alternatives. Additionally, market-based programs have the advantage of encouraging innovation in a direction that minimizes costs and reduces emissions. 

Another point sometimes overlooked is the opportunity for relatively inexpensive 

emissions reductions right now. Emissions reductions using more conventional technologies may not provide a complete solution to the climate problem, but by delaying the accumulation of greenhouse gases in the atmosphere, they provide additional time to develop long-term solutions. Even if a major technology breakthrough 

is needed to reach climate stabilization goals, there are many small-and mediumsized innovations—the type typically associated with learning by doing—that can 

yield significant benefits. Sending a signal about the value of emissions reductions 

provides the right information to the private sector about the importance of undertaking those activities. 

Consistent with this logic, the NCEP proposal tries to link the technology development and the mitigation sides of the problem into a coherent policy framework. By 

coupling technology incentives with an emissions trading program they provide sigVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00110 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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3Kopp, Raymond J., Richard D. Morgenstern, and William Pizer 1997.’’Something for Everyone: A Climate Policy that Both Environmentalists and Industry Can Live With,’’ Weathervane, 

September 29, available at www.weathervane.rff.org/features/feature015.html. Kopp, Raymond 

J., Richard D. Morgenstern, and William Pizer. 2000. ‘‘Limiting Cost, Assuring Effort, and Encouraging Ratification: Compliance under the Kyoto Protocol,’’ Weathervane, June 26, available 

at www.weathervane.rff.org/features/parisconf0721/KMP-RFF-CIRED.pdf.

nificant incentives—along with the necessary funding—to develop new technologies 

that are essential to the long-term success of any effort to reduce greenhouse gases. 

As a final point on the link between research and development, and mitigation, 

I will mention one particular line of thought in circulation these days that is somewhat at odds with the ideas laid out here. Because climate change is such a longterm problem, the thinking goes, it is not appropriate to encourage emissions reductions now—the policy focus should, instead, be entirely oriented to technology development. Although there are many complex issues here, the single point I would 

make is that even this view supports near-term emissions reductions as long as the 

cost is no higher than the expected value of future mitigation benefits. While one 

can debate the true magnitude of these benefits, the economics literature on this 

issue would certainly support the $7 per ton of carbon dioxide proposed by NCEP. 

I now turn my focus to a discussion of the use of a safety valve or price cap to 

avoid unpleasant cost surprises. In the context of a mandatory cap-and-trade system, a safety valve would specify a maximum market price at which the government 

stands ready to sell additional emissions allowances in order to prevent excessive 

prices. 

At the outset, one must ask a basic question: given the success of cap-and-trade 

programs without a safety valve, such as the one for sulfur dioxide, what is the 

basis for including a safety valve to control carbon dioxide and other greenhouse 

gases? The answer is simple and straightforward: carbon controls are potentially 

more costly to the economy than these other programs and, most importantly, there 

is greater uncertainty about the true costs. Unforeseen events such as a warm summer or cold winter, a spurt in economic growth, or a technological failure of some 

sort, may drive up control costs dramatically. One needs only point to the unforeseen events in California’s RECLAIM program that propelled the prices of permits 

for nitrogen oxides above $80,000 per ton, or the similar, albeit less costly, problems 

that arose in comparable programs on the East Coast. Because of these concerns 

a number of nations are considering safety valves. For example, Canada recently announced it would incorporate such a mechanism in its domestic program. 

As Harvard economist Martin Weitzman pointed out three decades ago, when 

higher control costs are of concern but the potential environmental damages are not 

particularly sensitive to short-term emissions fluctuations, it is unnecessary to impose strict quantity-based controls. Although the experience with sulfur dioxide 

trading suggests that the actual costs may be lower than expected, recent Congressional debates indicate a clear concern that mandatory carbon mitigation policies 

may become quite costly—even those involving modest targets. Part of the cost uncertainty arises from uncertainty about the level of future baseline emissions that 

would occur even in the absence of new policies. There are also uncertainties about 

the cost of reducing emissions below baseline, and about the overall efficiency of the 

emissions trading system. 

One way to address this issue is by using a safety valve that fixes binding emissions targets as long as costs remain reasonable and allows the target to rise if costs 

are unexpectedly high. In practical terms, the safety valve would involve an initial 

allocation of permits followed by the subsequent sale of additional permits that 

would become available at a fixed trigger price. Several of my RFF colleagues and 

I first proposed applying this mechanism to the control of carbon dioxide back in 

1997.3 Recently, NCEP has embraced the idea as part of a broader package that 

involves incentives for technology development, as described previously. 

In daily life, most individuals like to avoid unpleasant surprises (hence the popularity of insurance). It is possible to use certain policy options to avoid unpleasant 

surprises in the broader economy as well. Just as the Federal Reserve protects 

against wide swings in bond and currency prices, the incorporation of a safety valve 

in a greenhouse gas mitigation policy would prevent sharp increases in energy 

prices. The ideal climate policy is one that sets an upper limit on mitigation expenditures. Most consumers are interested in reducing their out-of-pocket expenditures 

for energy as well as other goods and services, and most businesses are interested 

in maintaining a stable environment for purposes of planning and investment. The 

risk of unexpectedly high compliance costs under a strict permit system would 

threaten that stability. 

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4 Hubbard, R. Glenn and Joseph E. Stiglitz. 2003. ‘‘Letter to Honorable John McCain and Honorable Joseph Lieberman,’’ June 12. 

The safety valve approach guarantees that emissions will not exceed the target 

as long as the price of the tradable permits does not rise above the trigger price. 

It differs in a few important respects from a well-known provision in the 1990 Clean 

Air Act Amendments that establishes a $2,000 per ton penalty (1990$) for violations 

of the stipulated sulfur dioxide emissions standards. Since the Clean Air Act penalty 

is far above the expected marginal control cost, it has a very low probability of being 

invoked. The notion of a safety valve reflects the society’s willingness to pay for carbon mitigation. It is not intended strictly as a punitive measure. For those who believe that the costs of reducing greenhouse gas emissions are relatively low, permit 

prices would never reach the trigger level and emissions would remain capped. 

One thing that has plagued policy proposals in the past is that different analysts 

using different models can produce quite disparate results. For example, in analyzing the Kyoto Protocol, President Clinton’s Council of Economic Advisers forecasted allowance prices below $7 per ton of carbon dioxide as compared to EIA’s $43 

estimate. Interestingly, with the safety valve the emissions estimates may vary 

among models but the costs cannot rise above the price cap. Observe that the EIA 

estimates of the NCEP proposal, which contains a safety valve, are extremely close 

to those of the respected consulting firm, Charles River Associates, which conducted 

that macro-economic analysis for NCEP. Similarly, recent EIA sensitivity analyses 

of the NCEP proposal reveal that compliance costs are virtually invariant with respect to a wide range of assumptions about natural gas supplies, the availability of 

non-carbon offsets, and other factors. 

A final point about safety valves concerns the claim by some that such a mechanism is unnecessary as long as banking and offsets are allowed. Citing the successful sulfur dioxide trading system, unexpected events of the type that doomed the 

RECLAIM program in California are dismissed as the product of a flawed design—

namely, the absence of provision for emissions banking and offsets—rather than as 

an inherent problem of applying a fixed quantity trading system to control emissions. The alternative view, espoused by at least two former chairmen of the President’s Council of Economic Advisors, is that banking or offset systems cannot reasonably adapt to unexpected events such as higher energy demand or inadequate 

technology as effectively as a safety valve. According to this view, offsets can reduce 

the expected cost of a particular goal, but they cannot address concerns about unexpected events. In fact, if the system becomes dependent on such offsets, their inclusion can actually increase uncertainty about program costs if the availability and 

cost of the offsets themselves is not certain. In regard to the banking or borrowing 

of emissions, the two Council chairmen note that ‘‘. . . [The]... features 

that . . . provide additional allowances when shortages arise...are helpful, but only 

to the extent they can ameliorate sizeable, immediate and persistent adverse 

events.’’ 4 That is, offsets or banking systems may reduce the problem, but they may 

not be sufficient to address all the uncertainties arising from unexpected spurts in 

economic growth, weather variations, or other events. 

Finally, I will briefly comment on the challenges of bringing developing countries 

into an emissions limiting agreement. While this is clearly a critical need for longterm success of any effort to address climate change, so far, no proposal has made 

much headway in this area. Developing nations are certainly not lining up behind 

the idea of binding emissions limits as laid out in the Kyoto Protocol. The president’s proposed use of intensity targets, which takes into account economic growth 

when measuring environmental performance, is more attractive to some developing 

nations than fixed emissions levels. However, there is no serious indication that developing nations are prepared to adopt this approach either. Senators McCain and 

Lieberman’s Climate Stewardship Act incorporates some limited incentives for developing nations by allowing up to 15 percent of the total emissions to come from 

offsets, including offsets from abroad. Recent proposals by Senator Bingaman incorporate a similar mechanism, albeit at a lower (three percent) level. How well such 

international offsets would compete against domestic agricultural and forestry 

projects, or against domestic non-carbon dioxide sources is an open question. Nonetheless, this approach clearly has some appeal. 

The recent Senate resolution on climate change represents an important step forward in redefining the initial terms of developing country participation in greenhouse gas mitigation by opening the door to potential linkages between climate 

change and other issues of international concern. The original Byrd-Hagel language 

requiring ‘‘new specific scheduled commitments to limit or reduce greenhouse gas 

emissions’’ by developing countries has been replaced by the stipulation that U.S. 

policies ‘‘encourage comparable action by other nations that are major trading partVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00112 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
109

ners and key contributors to global emissions.’’ This new language lowers the bar 

somewhat for developing countries and creates a more realistic expectation for participation by these countries. At the same time, it properly focuses attention on 

major trading partners with large emissions. 

Consistent with this new Senate language, a proposal advanced by Senator Bingaman calls for periodic Congressional review of the new U.S. mandatory program. 

Under this mechanism Congress would make a determination every five years to accelerate, decelerate, or leave unchanged the key program parameters including the 

emissions target and the safety valve price. In making this determination, Congress 

would review a wide range of factors, including recent technological advances. Of 

particular interest would be the mitigation actions of other nations, both developed 

and developing, to reduce emissions. Further, if the United States or other developed nations had established a program to support clean energy projects in a poor 

nation, that too would become part of the review. If one believes, as I do, that the 

key to international cooperation on climate change is linkage on a broad range of 

issues, including global trade, development aid, and technology transfer, then such 

a procedure would potentially provide Congress an opportunity to influence the actions of both developing and developed nations as climate policies evolve over the 

next few years, all the while avoiding, in EIN’s words, ‘‘material’’ impacts on the 

U.S. economy. 

In sum, Mr. Chairman, we have come a long way since the early discussions on 

the Kyoto Protocol. We are no longer talking about steep near-term emissions reductions with the concurrent dangers for the U.S. economy. Rather, the debate has now 

shifted to motivating both the public and private sectors to pursue technology innovation over the long term and capturing the low-hanging fruit of cheap emissions 

reductions in the near term, all the while protecting the economy from unwarranted 

burdens. Such an approach has great potential to encourage the development and 

adoption of new technologies that can put the United States and other nations on 

a long-term path to address the climate change issue. 

I thank you for the opportunity to appear before this committee and I would be 

pleased to answer any questions.

The CHAIRMAN. Thank you very much. 

I think I am going to do what I have usually done and hold mine 

for another time. Senator Bingaman, you can start and I will ask 

my questions later. 

Senator BINGAMAN. Well, thank you very much. Thank you, all 

of you, for your testimony. 

Let me just try to take the framework that Dr. Morgenstern has 

laid out and ask Mr. Grumet if he thinks it is an accurate description of what is involved here. First, he talks about the contrast between a command and control approach to dealing with greenhouse 

gas emissions versus a market-based approach, and characterizes 

this national commission proposal as a market-based approach 

which tries to send a modest signal to the market that will cause 

the development and promotion of new technologies. He says that 

is the primary objective, as I understand what he just testified to, 

that is the primary objective the commission is trying to achieve 

with its recommendations. 

Do you agree that is the primary objective? 

Mr. GRUMET. I think Dr. Morgenstern’s characterization is fundamentally accurate and fair. The ultimate goal, as I think all the 

panelists here agree, is to advance technology. The only solution to 

climate change requires the significant advancement of technology. 

The debate, of course, is how best to do that. While our Commission had contentious discussions, I would say equal to those that 

I have heard take place in the Senate, one thing that we all agreed 

about very strongly and very early was that if we were going to 

move forward to address greenhouse gas emissions, as we believed 

was appropriate, the marketplace had to be the ultimate arbiter of 

which technologies moved forward, how quickly, and in what 

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amount; that no matter how well intended or educated we all were, 

no 20 or 40 or 100 people could make the same kinds of decisions 

about how best to spend other people’s money than 200 million people could make about how to spend their own. 

So fundamentally, yes, we believe it is about sending a market 

signal, but also being realistic and not setting a signal so high that 

would make it politically irresponsible and create unacceptable dislocations. 

Senator BINGAMAN. Well, let me just ask. The way you have chosen, the Commission has chosen, to try to send this market signal 

is by designing a cap-and-trade system and putting a safety valve 

in it and saying, in order to be in compliance it cannot cost you 

more than $7 per ton of carbon that you put into the atmosphere. 

Just to be the devil’s advocate here, are there not other ways 

that the Government could incentivize the private sector to promote and develop these new technologies through cost-sharing, 

R&D, or various other things that would also get us to the same 

place or perhaps get us there in a more direct way? 

Mr. GRUMET. Senator Bingaman, I think there are certainly a variety of mechanisms, some of which you have heard described here 

today. Incentives sound lovely. We all like incentives. But fundamentally, somebody has to pay for those incentives, and in less 

attractive garb a massive Government program of incentives of the 

size which would be necessary to develop and deploy these technologies would require many tens of billions of dollars of taxpayer 

money, and we believe that the government is simply less efficient 

at choosing those solutions than the marketplace. 

So it is possible. I am certainly interested in Dr. Smith’s view of 

how much money it would take to advance the kinds of technologies at the pace that she believes is appropriate. We simply 

thought that it was not prudent, that it ultimately would be too 

costly, too inefficient, or some combination of both. So the marketplace had to be the dominant mechanism, but that mechanism 

could be augmented necessarily by raising some revenue to advance technology. 

Senator BINGAMAN. So as I understand it, your Commission basically came down with the idea that the Government should do 

more to fund R&D of this type, but in addition to that or in parallel, we should enact some type of cap-and-trade system to 

incentivize or encourage or prod the private sector into doing much 

more in technology development than they otherwise would? 

Mr. GRUMET. Senator, that is absolutely right. I think we all concluded quickly that the private sector, not the Government, was 

best capable of making these decisions, but that the Government 

needed to play a role, that placing the entire burden on shareholders was inappropriate and failed to meet the fairness test that 

Chairman Domenici addressed at the outset, that sharing that burden, dramatically finding ways to engage both the collective spirit 

and ingenuity of the private and public sectors, would have a synergistic benefit that we think is the ultimately coherent policy approach. 

Senator BINGAMAN. Well, let me ask. One of the things that we 

sort of got hung up on when we were talking about this in the context of the energy bill, and very legitimately, questions were raised 

111

about how would—if you had a cap-and-trade system like the one 

you have described here, how would you allocate the credits or 

emissions credits, whatever, in a way that would be fair to everyone involved, would not advantage some sector of the economy over 

another? 

Where are you and where is the Commission in its deliberations 

on that? Do you think that can be done? Is it still to be done in 

the future? Are you in the process of doing it? 

Mr. GRUMET. Senator Bingaman, I think as you and Senator 

Domenici both expressed during the closing hours of this discussion 

on the energy bill, there are clearly winners and losers. There are 

winners and losers if there is a carbon price of zero, there are winners and losers if there is a carbon price of $7, $10, or $100. 

One way that you can address those fairness issues is through 

the allocation of permits. It is important to stress that who you distribute the permits to in no meaningful way affects the overall economic costs of the program. Dr. Gruenspecht and CRA were able 

to analyze the total costs of our program with no knowledge of how 

the allocation would ultimately be meted out. 

But to make the approach ultimately equitable and politically 

feasible, these are critically important decisions. I have to go off 

book here because our Commission did not try to specify a particular allocation formula, based on the view that that was ultimately such a political decision that we would really not be serving 

ourselves or the Senate very well by trying. We have started to 

host a series of very well attended workshops to try to bring together the various sectors of the economy and the interests to 

imagine different approaches. I think that it is surely possible to 

establish an equitable approach to allocation, just as was done in 

the acid rain program, and commend you for committing to consider these issues further. I think that will become ultimately the 

fundamental challenge, probably the last challenge in moving forward with legislation. 

Senator BINGAMAN. Mr. Chairman, I notice the lights have not 

been on during my questioning. I do not mind continuing to ask 

questions, but I think I have been doing this for 5 minutes or more, 

so I will stop so others can go ahead. 

The CHAIRMAN. I think you have, but we were going to let you 

go on for a little while longer. 

I think that we will go on our side now. Senator Martinez was 

next, but he did not want to proceed. 

Senator Thomas, you are next. 

Senator THOMAS. Thank you, Mr. Chairman. 

A very complicated issue and I appreciate all the detail that you 

have said. Would it be possible for you in two or three sentences 

to sum up your recommendation, where should we go from here, 

not go into all the details, but say what basically are you recommending for us to do? Would you each do that? 

Dr. GRUENSPECHT. I am from the Energy Information Administration, so I am not recommending any actions. 

[Laughter.] 

Senator THOMAS. Well, thank you very much. I appreciate that. 

Doctor? 

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Dr. SMITH. What I would like to say is that we need to first and 

foremost figure out how we are going to get to where we want to 

be, what sort of program is needed, how will we accomplish it, 

what will its targets be in terms of costs for reducing emissions——

Senator THOMAS. But that is, you are just asking questions. I 

want to know your answer. What would you do? 

Dr. SMITH. I would design an effective R&D program that the 

Government could fund and get it started, and using that mission 

of the R&D devise some understanding of what sort of economywide emissions price should be placed on the economy today. 

Senator THOMAS. I see. Given things like AML funds and so on, 

do you think the Government is prepared to handle that money 

properly? 

Dr. SMITH. Sorry? What kind of funds? I did not hear. 

Senator THOMAS. Well, just some of the funds that have not gone 

where they were intended to go when the Government is in charge. 

Dr. SMITH. It is clear that funding of R&D needs to be a partnership of the private sector and the Government. The Government 

needs to sort out what amount of funding needs to flow and then 

find the means to support that funding. 

Senator THOMAS. Thank you. 

Mr. Grumet, you have talked in detail, but sum up where we are 

going. 

Mr. GRUMET. In a couple of sentences, our Commission believes 

that we need to act as soon as possible to establish a modest longterm market signal that inspires the ingenuity of the private sector, support those exercises with continued government funding for 

longer term R&D, and link that program to efforts in developing 

countries so that we make sure that we ultimately have an effective and equitable global solution. 

Senator THOMAS. Thank you. 

Dr. MORGENSTERN. I would endorse a balanced approach involving a cap-and-trade with an R&D system which stimulates both 

private and public sector, quite similar to the NCEP, and that is 

my one sentence. My second sentence would be that there is really 

not that much difference between what Dr. Smith is proposing and 

what the NCEP is proposing, in the following way. 

Dr. Smith in testimony recognizes that there is an economic logic 

to have a cap-and-trade approach. In Dr. Montgomery’s testimony, 

which was not given today but was scheduled previously, he actually went so far as to name a number. His number was $4 a ton 

of CO2. So we are really talking about a difference, in a sense, between $4 and $7. I would note simply for the record that there is 

a substantial literature that would support a $7 basis and there is 

really not a large difference in truth between the two. 

Senator THOMAS. I notice you shaking your head. 

Dr. SMITH. Dr. Montgomery did not suggest $4 per ton. It was 

a footnote that was an example of how you could back out what an 

appropriate spending would be once you know where you are headed with the R&D, and it was predicated on an example where the 

R&D would produce massive zero-emitting emissions reductions by 

2050, I think, at a cost of $25 a ton. 

So it was not a recommendation. It was an example. I believe I 

kept it in my testimony. 

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The other point is I am not recommending a cap-and-trade program. I am recommending an economy-wide price signal that would 

be predicated on the ultimate goal and mission of an R&D program 

once that is designed. So I am not debating the needs for some carbon price signal in the near term, but I am debating the way that 

it ought to be introduced and set up as a policy in the economy. 

Senator THOMAS. Thank you. 

Two comments as I close. One is that this trade thing seems to 

me, having been involved in world trade a little bit, what you are 

doing is giving away something that people that are not generating 

anything, that is not going to make any change particularly in the 

world. 

The second is I see some of these numbers here in the reducing 

of coal, which is our largest fossil fuel resource. So when you look 

at energy issues on one side and these issues on the other, you 

have to have some balance in the kinds of fuels that we have available to keep people’s lights on. So it is easy to talk about reducing 

all those uses, and at the same time what are you going to substitute it for? 

So thank you all for being here. 

The CHAIRMAN. Senator Salazar, I think I am going to go to Senator Murkowski, because she was here before you, if you do not 

mind. 

Senator Murkowski. 

Senator MURKOWSKI. Thank you, Mr. Chairman. 

All of you have keyed in on the focus on technology, research and 

development. In the energy bill that was just passed, and signed 

by the President, we had a component or a section in there that 

related to the technology to provide for incentives that was, I guess 

if we had to characterize, our portion of the energy bill that related 

to climate change. There were those of us that looked at the legislation that Senator Hagel had put together in working with many 

of us and said, this is a step in the right direction. 

Your comment on that? Is that sufficient? Do we need more? Dr. 

Smith, I think you said specifically that you think that policymakers have paid minimal attention to the R&D, the technology 

end of it. Are we going in the right direction with what we have 

passed? 

Dr. SMITH. Are you speaking of title XVI? 

Senator MURKOWSKI. I do not know what the title is. 

Dr. SMITH. The part that passed——

Senator MURKOWSKI. Yes, yes. 

Dr. SMITH. That is a start in the direction of defining a technology strategy, but it does not create the vision and mission of an 

R&D policies end point. Until we know where we are going, it is 

very difficult to organize an effective R&D program, let alone to determine how much should be spent on it. 

So I think it had the right orientation of focusing on the R&D, 

but it did not provide and has not yet produced the vision of what 

needs to be accomplished in the R&D and then how to motivate our 

resources to get there. 

I would say also, in the proposed amendment that reflects the 

NCEP proposals the subsidies do not reflect an R&D program. That 

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is not what I mean by a revolutionary change in technology for providing energy over the next century. 

Senator MURKOWSKI. Any other comments on that? 

Mr. GRUMET. Senator, if I may. I think the energy bill is absolutely directionally correct. I agree with Dr. Smith on the need to 

do more. I also share the concerns of many that we are going to 

have a hard time finding all the money to support all the good 

things that the energy bill sets forth. So that is why this combination of market signal and an R&D program made sense to us. 

To Dr. Smith’s comments differentiating between breakthroughs 

and advances, I guess I am not clear about the technology. What 

I am clear about is no democratic process can determine a 100-year 

future to enable us then to move 100 years back and ask the right 

questions. Climate change is a century-scale problem. We are going 

to have to take a first step and then iterate from there. I believe 

that the energy bill and our Commission’s support for advanced nuclear designs, for carbon capture and sequestration, for gasification, 

for dramatic increases in biofuels, to encourage the domestic production of more efficient transportation systems, and down the line 

are those gap technologies. 

I would encourage the committee to look to the work of Dr. 

Sakalow from Princeton, who has identified 15 what he calls wedge 

technologies, the technologies I just mentioned and also efficiency 

technologies, natural sinks like agriculture and forestry. I think he 

makes a compelling case that if you look at those 15 technological 

categories, while ultimately the marketplace must choose among 

them, it provides a menu that I actually find quite encouraging. 

Over the next 50 years, I think one can see optimism that both 

domestically and globally by moving forward with these technologies we can actually get to the goals that I think Dr. Smith and 

I share. 

Senator MURKOWSKI. Dr. Gruenspecht. 

Dr. GRUENSPECHT. Thank you. I would say that we in our analysis did a sensitivity run looking at different energy technologies—

what difference would a different set of technologies make. It does 

make a considerable difference to the results, both with and without additional policies. So there is no question that technology matters. 

We do sometimes have trouble relating changes in legislative 

provisions to changes in technology. A lot depends on what happens with a program. I think one of your colleagues mentioned earlier that some programs get run well, some programs do not. There 

are also issues of what is the amount of actual appropriations—is 

it just money moved from one category to another category—so you 

close an old program and start a new program. All those questions 

come up. 

So it is very hard for us to look at the effects of a particular program, particular legislative language, and say what difference that 

makes to technology. But there’s no question that technology 

makes a difference. 

I would also note that the Department of Energy has a climate 

change technology program. I think it is also referenced in the energy bill. They do have a vision and framework for strategy and 

planning that is on the web site, and it is my understanding that 

115

they will put out a strategic plan, a long-term strategic plan for 

public comment, some time in the near future, that I think does address some of the—or may address some of the issues that Dr. 

Smith raised. 

So I think there is an effort to provide a road map, if you will, 

that the Department will be coming forth with in the fairly near 

future. That might be of interest to you. 

Thank you very much. 

Senator MURKOWSKI. Thank you, Mr. Chairman. 

The CHAIRMAN. Senator Salazar, I am going to ask a few questions since I did not ask any. Then you are next. Is that acceptable 

to you? 

Senator SALAZAR. Yes. 

The CHAIRMAN. Let me talk a minute about the Kyoto since we 

get that thrown at us quite often. First, I would like to reiterate 

an observation that seems to evade most people that criticize 

America, that the decision about Kyoto was not made solely by a 

President. The U.S. Senate voted and told the President of the 

United States, do not send that treaty up here, because we would 

not approve it, and that vote was 98 to zero. So everybody should 

know that for every time Europeans decide to chastise President 

Bush about it they should add, and the U.S. Senate decided it 

would not work. 

Now, having said that, what would a reduction of emissions to 

1990 levels do to the U.S. economy, either of the economists here, 

or you? It is my understanding that only two members of the European Union are likely to meet Kyoto commitments. If mandatory 

controls are deemed to be the answer to the climate change problem, why are such controls not working in Europe? 

Dr. GRUENSPECHT. We at the Energy Information Administration 

back in the late 1990’s did some analysis of the Kyoto Protocol and 

those analyses suggested, I think, pretty significant economic impacts. I should also point out, though, that various EIA analyses 

are not directly comparable for several reasons. 

One, the reference case used as a baseline for the analysis has 

changed a lot since that earlier work was done. Second, our Kyoto 

analysis did not look at non-CO2 greenhouse gases, which we know 

from the analysis we did for the NCEP proposal requested by Senator Bingaman, make a difference. Third, there is frankly uncertainty in interpreting what the Kyoto Protocol itself means. 

Let me give you an example. There is a period from 2008 to 2012 

where there is an emissions limitation under that agreement, but 

the question is what do you assume beyond 2012? Do you assume 

it stays at the same level? Do you make an assumption about what 

the negotiators in that framework will agree to beyond 2012? So 

there are lots of open questions. 

But I take your point that certainly a large emission reduction 

in a short period does tend to produce much larger economic impacts. 

The CHAIRMAN. Anybody else want to? I do not want to spend all 

my time on Kyoto. It just irks me that it is constantly referred to 

by Europeans, even with reference to the hurricanes. It is just 

amazing that they are talking about, since America did not sign 

116

the Kyoto agreement, we are reaping what we are entitled to in 

hurricanes. I do not know how anybody can even say such a thing. 

Yes, Mr. Economist. 

Dr. MORGENSTERN. Well, the only thing I would add to Dr. 

Gruenspecht’s point is that the reductions required for the Europeans are in fact lower than they were for the United States, so 

that it is not even fair to make that comparison about what the impact is on them as opposed to what it is on us. 

The CHAIRMAN. A very good point. 

The other point, I do not want anybody, including you, Mr. 

Grumet, anybody working on this approach, to think that we ought 

to look at acid rain. We should, but that is an easy comparison. 

You understand that the area of involvement is very minor in 

terms of the numbers of participants in the SOX problem. There 

are just two major ones, whereas when you are trying to put together all the players in this area there are many, many scores of 

them. So it might be a similar idea, but it certainly is not a similar 

problem. Is that a fair statement? 

Mr. GRUMET. Mr. Chairman, I think that is exactly right. I think 

that the Energy Commission’s approach tries to directly recognize 

that. I think there was no argument, really significant argument, 

that you needed a safety valve on the SO2 proposal. It was manageable. The technologies here are greater, I think much greater, and 

I think the response needs to be different. 

The CHAIRMAN. I have got three quick questions. The next question has to do with an appropriate incentive to move the technology. I am listening attentively to the difference in opinions here 

on how we move the technology. Dr. Smith, I understand yours, 

and I understand yours on behalf of your Commission. But let me 

ask, in the energy bill we recognized that it probably would be difficult for the U.S. Government to appropriate money for the experimental technology, say three or four major new projects in the gasification, sequestration area. So we provided an incentive provision 

that says two ways to do this. One is appropriate and the other is 

by a new type of loan that the Federal Government could make on 

a 75-25 basis at reduced interest rates, with insurance being paid 

by the applicant so that it is cost-neutral. 

Is that an incentive in anyone’s opinion for anybody to use that, 

or is that not sufficient? 

Dr. Smith. 

Dr. SMITH. That is an incentive to implement a technology that 

can be implemented today, that exists at a near-reasonable but still 

too high a cost to be justified in the marketplace. When I speak of 

R&D, I mean what may involve basic research, basic scientific research, to make breakthroughs that would allow technology to 

come in at maybe half the cost of what can be done with the current technologies today at some price that is in the realm of too 

costly for the marketplace, but may be subsidizable. 

The CHAIRMAN. Anybody else have a comment on that? 

Mr. GRUMET. Mr. Chairman, I think the tax credits are very 

thoughtful and appropriate mechanisms. I think those will encourage IGCC. I just have maybe lower expectations than Dr. Smith. 

I think deploying a fleet of carbon-sequestered IGCC facilities in 

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the next 20 years is an incredible accomplishment that we should 

strive toward. 

The CHAIRMAN. Well, that is why we put it in there. We thought 

that. She may be right, though, and we have to have another thing 

going on basic. And we do not put enough money in basic research, 

so I do not know where we would ever get enough here, unless it 

came from the carbon that you are speaking of, the carbon, the assessment of a carbon tax, which seems to be anathema. 

Dr. Smith, you indicated—you had an observation: For the nearterm emissions reductions, the most cost-effective emission reduction available today are in the developing countries. I think you 

said that. Placing a high priority on near-term control policies to 

bring about changes in how energy is used in developing countries 

is most important, as you indicated. 

Would you elaborate for us on how we might help get that done, 

or is that up to somebody else and it will happen or not without 

us? 

Dr. SMITH. One of the greatest barriers that we have identified—

and my colleague David Montgomery has been working on this one 

at some length in the last few years. One of the greatest barriers 

to getting the technology into other countries is simply the basic 

rule of law, property rights, and inviolability of contracts and enforceability, general freedom of markets, and even pricing energy 

at its cost. 

If these things could be changed, then better investments can be 

made with today’s technology. Even with the efficiency standards 

that we have today, those could be better deployed into these developing countries and achieve much greater reductions in emissions 

globally, which is all that we really care about, than we can 

achieve in our own country at that cost. 

The CHAIRMAN. So those countries would have to do that, make 

those stabilizing decisions? 

Dr. SMITH. It is a challenge. Again, the Hagel-Pryor amendment 

that passed into law with the Energy Policy Act has some provisions to move in that direction. It is a very good first step. It identifies the right challenges, I think. But it is still going to be a challenge to implement. 

The CHAIRMAN. My last question goes to you, Mr. Grumet. You 

are busy having task force, or whatever you call them—what do 

you call them? 

Mr. GRUMET. Workshops. 

The CHAIRMAN. Workshops, trying to address the issues that 

Senator Bingaman and I introduced on the floor, that you had a 

great idea and we introduced a great bill, but how do you implement it? Are those workshops aimed at trying to fill in some gaps 

as to what might be a fair way to implement? 

Mr. GRUMET. That is certainly the aspiration, Chairman Domenici. I should say, though, that I think we are realistic in the expectations we have for 3 or 4 half-day sessions. We found that there 

was a dramatic degree of misunderstanding about the different options and I think our hope was actually to bring people together 

so that we could then fight more effectively before you in the future. 

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We are not optimistic or even seeking to bring together a consensus, but I think that we can elevate the understanding so that 

we can have a more effective real debate. 

The CHAIRMAN. It seems to me those stakeholders who are participating may be the ones who come up with the answers. 

Mr. GRUMET. That would certainly be our hope. 

The CHAIRMAN. Senator Salazar. 

Senator SALAZAR. Thank you very much, Chairman Domenici 

and Senator Bingaman, for holding these hearings on this very, 

very important issue. 

I have two quick questions. The first relates to agriculture and 

how the agricultural community might actually benefit from a capand-trade system and the second question has to do with the EU 

and their cap-and-trade program and how that is working. I am 

going to ask the questions and let you comment on both of them. 

First of all, with respect to my question on agriculture, it seems 

to me that farmers in Idaho who are growing potatoes by the thousands and thousands of acres or farmers in my State that are 

growing alfalfa could see significant positive impacts from being involved in a cap-and-trade system, because they obviously are consuming large amounts of carbon dioxide in the growth of their 

plants. 

I am one of the defenders of our energy bill because I think it 

did for the first time in our country push forward renewable energy 

as a major component of our future energy policy, and I think that 

is creating opportunities and will create opportunities for rural 

America and for agriculture. But I also see the issue of how we 

deal with climate change as creating an opportunity for farmers 

who are consuming so much carbon dioxide in their plants. 

I would like you to comment, Mr. Grumet or Dr. Smith, Dr. 

Morgenstern, whoever of you wants to comment on that issue of agricultural opportunities as we deal with the issue of climate 

change. Then, second, if you would also comment on how the European Union cap-and-trade system is in fact working, since it is up 

and running. 

Mr. GRUMET. Maybe I will start with agriculture and then turn 

it over to somebody else to talk about the EU. Senator Salazar, I 

think your instinct is exactly right that, given a rational incentive, 

there is money to be made in agriculture for lower carbon activities. I think it is also particularly important to think about this as 

we see that the commodity price supports and the Doha Trade 

Round and others are now being called into question. We are sensing a growing interest in the agriculture community, thinking 

about how in fact carbon-smart activities could also be a profit center. 

I just point to two examples. Obviously, if there is a value to reducing a ton of emissions that would provide a significant incentive 

to sequester carbon through more intelligent agricultural practices. 

In addition, farms have a tremendous opportunity to provide energy and do so in a low-carbon, low-cost way. I think we were very 

pleased to participate in a workshop that Senator Craig held talking about how to bring cellulosic biomass from wheat straw into 

the marketplace. What we find, of course, is that that product, 

while desirable, is more costly than gasoline. It is also far lower in 

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carbon emissions. If there was a value in the marketplace to lower 

carbon emissions, it would provide an additional incentive to those 

thoughtful types of breakthrough technologies that I think we all 

want to see advance. 

Senator SALAZAR. Mr. Chairman, I had the opportunity to be in 

Europe last week to participate in a discussion of the EU system. 

I am not an expert on it, but I can report a little bit about some 

of the results. It is operating, as you know, in two phases. There 

is a warmup phase for the first several years and then beginning 

in 2008 is when the larger version goes into place. 

At this point they have over 11,000 sources actually participating 

in the program. All 25 countries have actually set up programs and 

have approved plans. There have been a fair number of trades. 

There has also been a fair amount of price volatility. The range of 

prices has ranged from somewhere around eight euros per ton of 

CO2 up to almost 30 euros per ton of CO2. Currently it is around 

22 or 24 euros. 

It is interesting to try to draw some lessons from their experience 

for our experience. Of course, everything is still in the early phases 

and it will undoubtedly evolve. But I think there is a couple of 

points that one can make. First of all, the price volatility that they 

have experienced, which in many ways is tied to changes in weather patterns and fuel market changes, would probably not be experienced under the NCEP proposal, simply because the safety valve 

would undoubtedly have dampened that. So that is one difference. 

Second, there have been some complaints in Europe raised about 

potential windfall profits in their system, and in part that may be 

tied to the allocation system. Undoubtedly, Congress would do a 

fairly detailed—would make fairly detailed decisions about allocation that I would expect would obviate that problem. 

Senator SALAZAR. Dr. Morgenstern, what has caused the vola- tility in terms of price from $8 to $30? 

Dr. MORGENSTERN. Well, the experts in Europe believe that it 

has to do with weather, different expectations about weather, and 

frankly fuel volatility. International oil market prices and other 

fuel changed have been the largest driving forces. That is what 

they have explained to me and I am just reporting that to you. 

But the safety valve, as I say, had it been in place would have 

dampened that and would have prevented that from occurring. 

Senator SALAZAR. In the European cap-and-trade market, what 

has been the experience of agriculture with respect to that market? 

Are there programs under way that agriculture is benefiting from 

because of the cap-and-trade system there? 

Dr. MORGENSTERN. Well, that is a very interesting point. The design of the system as I understand it does not include agriculture 

at this point, and in fact the design of the system only covers onehalf of the total emissions in the economy. So we could actually—

so a sector like agriculture is not able to participate in the I system. In the NCEP proposal it would be able to participate. 

It is interesting in terms of the EU compliance. Because they 

have only about less than half really of their economy, the emissions, covered by this trading system, it is very likely that the 

other half will in fact not make the targets, and we may have a 

system where the trading system seems to be highly successful, but 

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the overall outcome in terms of the EU meeting its targets may not 

come to pass. Obviously we do not know. They may be able to buy 

tons from Russia or something. I do not know how that will play 

out. 

But sectors like agriculture or sectors like transportation, which 

are not able to participate by design in their system, are reportedly 

having the most difficult time meeting their targets. 

Senator SALAZAR. Thank you very much. 

Senator CRAIG [presiding]. Thank you. 

We have a vote under way, I think, now. Is that correct? Two 

votes stacked. The chairman has gone to vote and I think plans to 

return, so we will move on for a time. 

Senator Talent. 

Senator TALENT. I will be brief, Mr. Chairman. 

Mr. Grumet, if we adopted NCEP how much would it reduce 

global warming? How many degrees reduction would we get? 

Mr. GRUMET. Senator Talent, I am guessing you know my answer is that the NCEP proposal in the first 10 years would have 

no meaningfully ecologically visible impact on the globe’s warming, 

nor would Kyoto, nor would McCain-Lieberman or anything else. 

Senator TALENT. Maybe after the 10 years, what will we get? 

Mr. GRUMET. All of these are century-scale efforts. I think that 

there is a recognition in the scientific community that if we allow 

greenhouse gas concentrations to double or triple we may find very 

unfortunate effects that would result from a three to five degree increase in temperature. The goal is to mitigate that. 

Senator TALENT. After 10 years, do we know? 

Mr. GRUMET. Senator, we will never know. I think that is a 

fair——

Senator TALENT. Fair enough. 

Just to make this brief, because maybe Senator Smith wants to 

go before the vote, I think the NCEP concept explicitly anticipates 

that after 5 years or 10 years we will consider another step. Is that 

correct? 

Mr. GRUMET. Absolutely, sir. 

Senator TALENT. Now, here is my concern about how this might 

operate on the ground. If you are a company and you are thinking 

about investing in a chemical plant or a refinery—and we certainly 

need more refinery space—and Congress has passed NCEP, maybe 

you can quantify the costs of NCEP. But what you know is that in 

passing it, Congress explicitly anticipates doing something else 5 

years or 10 years down the road. You do not know—as a matter 

of fact, what is being I think marketed as a virtue of NCEP is that 

we do not know, that we will make some adjustment down the 

road. 

So you are thinking of investing hundreds and hundreds of millions of dollars in a plant. You are going to have to get a rate of 

return on it. You certainly do not want a financial disaster, and 

you have this thing hanging out there. Now, do you not think that 

under those circumstances you might consider, you know, we can 

make a similar investment in China and we have a pretty good 

idea what our costs are going to be there? 

Mr. GRUMET. Well, Senator, certainty in terms of projecting atmospheric or global temperatures or business is always a desire 

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and never an option. The question that our Commission dealt with 

in terms of business certainty was, was there more certainty in the 

status quo, where people have all kinds of different proposals, 

many much more aggressive than ours, many much less aggressive, 

and we kind of have a spiritual fight about are we going to do it 

all or do none of it. 

I think our group came to conclude that setting a path forward 

that had a gradual program, that recognized that we had to slow 

emissions before we sought to stop and ultimately reverse them, 

that obligated the Congress of the United States to affirmatively 

engage before those changes were made, that had a set of dials for 

an intensity reduction so you would not have discontinuities and 

big jumps, I think our group thought that provided more certainty 

than rolling the dice and seeing what happened next. 

Senator TALENT. When I chaired the Small Business Committee 

in the House I had to constantly remind myself, we love small business because it produces jobs, it hires people, it produces technological innovation, but nobody ever started a small business to create jobs. They start a small business or, for that matter, they make 

an investment as a big business in order to get a return on the investment. 

I just think we have to be very careful. I understand what you 

are doing and I think from our perspective here it seems to make 

sense. We talk with all the stakeholders, we have this initial step. 

My concern is on the ground it is going to produce actually more 

investment precisely because of the uncertainty, it is going to 

produce more investment where they do not care about global 

warming, and we may end up with more greenhouse gases and 

fewer jobs, and that would be the one dumb thing to do, would be 

to hurt the economy and get nothing in favor of it. 

I understand what you are doing. I am just concerned that the 

uncertainty may have exactly the opposite of what you intend. 

Thank you, Mr. Chairman. 

Senator CRAIG. Thank you very much. 

Senator Smith, I got here before you did. I am going to ask one 

question. I think we can get both of our questions in. 

I wanted to ask this of EIA. Figure 4 in your charts, doctor. I 

find it very interesting as you look at the spread of savings and 

usage, and figure 4 represents that item, generating capacity additions by type 2004 through 1925. I have traveled the world about 

as much as anybody on the climate change issue. I do not know 

how many COPS I have been to, but it is a fascinating cottage industry to watch. Now, having said that, I do not mean that as a 

slam at all. But there is a great industry that has grown up around 

climate change itself, for better or for worse. 

But there is a reality out there and the reality is that there are 

some technologies, if fully implemented, could have tremendous effect on emissions. One of them is nuclear. We worked very hard to 

incentivize new nuclear in the energy bill and, while I have not 

read all of your testimony, I would hope that you would analyze 

and make a reasonable argument that if we fully implemented and 

fully fund what we have just done as a country we could move ourselves ahead in a dramatic way, but most important is that we 

122

would also build technologies that were available to the world to 

use. 

So I am sitting with the Chinese representative in Buenos Aires. 

He talks about 100 new nuclear plants, 100. They are still dominantly coal. They are going to build a lot of coal. We are now working with India. They could come on line. We have at least four on 

the drawing boards in this country now that could be pouring concrete by 2008, could be on line by 2015. Yet nothing shows up here 

in your charts as to increased generating capacity as it relates to 

nuclear. Or am I just missing it? 

Dr. GRUENSPECHT. First let me say, I am a retiree from the cottage industry that you mentioned having to do with global warming. So I was quite involved in the early 1990’s, less involved today. 

I would say that this is an analysis of the NCEP policy proposal. 

Senator CRAIG. So I am directing it at the wrong——

Dr. GRUENSPECHT. No, you are directing it correctly, I think. The 

NCEP policy proposal had a modest incentive, I think, that in our 

estimation produced one additional nuclear plant, and there it is in 

our chart. 

This analysis, I will say, was done before the passage of the energy bill and, as you mentioned, the energy bill has some very significant incentives for nuclear, including a production tax credit. 

That is a very significant incentive for up to 6,000 megawatts. It 

has the insurance proposal that the administration advanced. It 

has title 17. Presumably, the incentives there, which are very openended, could be used for nuclear. 

What I would say is that this chart does not reflect the energy 

bill. It reflects the incremental effect of the NCEP proposal. We 

will in fact at EIA need to look at the energy bill in the context 

of our next annual cycle of long-run projections, and those are very 

significant provisions and those provisions would have an effect. 

But this analysis and the testimony was about the NCEP proposal. 

Senator CRAIG. I got you, I got you. 

I am a little frustrated that we are still—and we should, I 

guess—be hypothesizing where the future is. I do believe there is 

a responsibility, though, to suggest, those of you who are advocates, 

that what we have just done is a significant work and we ought 

to be fully funding it and implementing it, because there are technologies in there that spread across the spectrum into the world at 

large, that are going to be very beneficial in the long term, while 

we still debate conceptual ideas of how to do other things. 

Dr. GRUENSPECHT. Let me just say one more thing. Obviously, 

EIA has no crystal ball about what the funding will actually be. 

But at least with respect to the production tax credits, that is not 

a proposal that requires funding as we understand it. 

Senator CRAIG. That is correct. 

Dr. GRUENSPECHT. And we will need to deal with that. 

Senator CRAIG. Senator Smith. 

Senator SMITH. Let me begin my comments by admitting to our 

questioners—thanking you for being here, or our panelists, but admitting to you that I am suspicious of government-planned markets. Last week I was one of the few Republicans who voted 

against the cap-and-trade system for mercury that was proposed by 

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the Bush administration. The environmentalists loved my vote, but 

now they want me to vote for a cap-and-trade system as to carbon. 

How do you reconcile that? 

Mr. GRUMET. Senator, I will wade into these delightful waters. 

I think that the general conclusion that our Commission brought 

to this discussion is that market-based programs are more efficient 

and more effective and should be used everywhere possible, with 

one exception. That exception is when the use of the free market 

creates distributional impacts that concentrate pollution in one 

place and not another. 

I take no position on the mercury decision, but note that, mercury being a neurotoxin, there are concerns about market trading 

in mercury, which I assume attach to your concerns and your vote. 

Carbon being harmless to breathe, it is actually the perfect pollutant in which a market-based system can provide you with all the 

incentives with none of the anxieties about those distributional impacts. 

So I imagine that is the basis of the differentiation. 

Senator SMITH. I guess my concerns or my suspicions about the 

EU’s approach and the difficulties they are running into, my suspicions I guess are further heightened by all of this. 

But when it comes to carbon, I live in a State where every year 

we burn up tens of millions of acres of trees. 2 years ago—I think 

it was 2 years; maybe it is 3 now—we had the Biscuit Fire. It 

burned up more land than there is acreage in the State of Rhode 

Island. The amount of carbon that that put out was 40 million 

tons. 

I know you are not foresters. 40 million tons, just that right 

there, that is about 10 percent of the emissions of all the coal 

plants in America. I guess my question is what is the best forest 

policy? When you think of requestration, should we just leave these 

carbon moonscapes as they are and let natural regeneration go? Or 

would we be better off in terms of global warming to replant these 

areas, knowing that that takes half the time that the other takes? 

Dr. SMITH. May I comment? 

Senator SMITH. Yes. 

Dr. SMITH. First I would like to point out that 40 million tons 

is about our estimate of how much the NCEP proposal would 

produce in reduction in 2010. So you are right that it is a very 

large amount, but it is also a very small amount that we are saying 

would occur under the NCEP proposal. Effectively we are saying it 

will give us the equivalent of one less forest fire of that sort. 

On the other hand, it certainly makes sense to reforest where 

one has burned down if that is the best use of the land. That will 

certainly sequester over time some of the emissions back in. 

Senator SMITH. So replanting is good for global warming purposes? 

Dr. SMITH. Replanting generally is good for reducing carbon 

emissions if it makes sense as a land use, too. 

Senator SMITH. Any other comments on that? 

Mr. GRUMET. I come from a part of the country that is largely 

paved, so I am not going to offer my thoughts about forestry. I 

would just note that Dr. Smith chose to identify the first year of 

this program, which begins very gradually. In 2025 our modest proVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00127 Fmt 6601 Sfmt 6602 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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gram is expected to reduce a billion tons of carbon a year. So 40 

million is a big number, but I think in context it is certainly not 

fully offsetting what we would consider a mandatory economy-wide 

reduction program. 

Senator SMITH [presiding]. It is interesting you say that. This is 

no criticism, but it is the areas that are all paved over that are telling the areas where forests how to run their forests. 

I think all of my colleagues have left to vote and I need to do 

the same as well, because I think it is just about to end. So let 

me—I am given instructions that we are adjourned. 

[Whereupon, at 11:41 a.m., the hearing was adjourned.] 

(125)

* Figures 1 and 2 have been retained in committee files. 

APPENDIXES 

APPENDIX I 

Responses to Additional Questions 

RESPONSES OF JAMES W. HURRELL TO QUESTIONS FROM SENATOR BINGAMAN

Question 1. Over the last several decades, anthropogenic emissions have ‘‘substantially contributed’’ to the increase in average global temperatures. Upon receiving 

a question from one of the Senators, one of the panelists suggested that ‘‘80 percent’’ 

of the warming was due to human activities. Do all the panelists agree? Please provide information as to how this estimate was derived. 

Answer. The strongest evidence to support this statement comes from numerical 

experiments performed with state-of-the-art global climate models. These models encapsulate the current understanding of the physical processes involved in the climate system, the interactions, and the performance of the system as a whole. They 

have been extensively tested and evaluated using observations. Today’s best climate 

models are now able to reproduce the climate of the past century, and simulations 

of the evolution of global surface temperature over the past millennium are consistent with paleoclimate reconstructions. 

As a result, climate modelers are able to test the role of various forcings in producing the observed changes in global temperature. Forcings imposed on the climate 

system can be natural in origin, such as changes in solar luminosity or volcanic 

eruptions, or human-induced, such as increases in aerosol and greenhouse gas concentrations in the atmosphere. 

Climate model simulations that account for such changes in forcings have now reliably shown that global surface warming of recent decades is a response to the increased concentrations of greenhouse gases and sulfate aerosols in the atmosphere. 

An example, from a climate model simulation performed at the National Center for 

Atmospheric Research (NCAR), is provided in Figure 1.* When the model is integrated forward in time over the 20th century with only information on imposed natural forcings, there is no discernible trend in global surface temperatures over the 

last several decades (blue line). When changes in greenhouse gas and aerosol concentrations are added to these natural forcings, however, the model not only simulates an increase in global surface temperature (red line), but it almost exactly reproduces the observed rate of change (black line). Numerous simulations for each 

case are run, and the solid lines represent the mean while the shaded regions indicate the ‘‘spread’’ about the mean. This spread reflects intrinsic natural climate variations arising from purely internal atmospheric processes as well as from interactions among the different components of the climate system, such as those between the atmosphere and oceans or the atmosphere and land. 

Such results, which have also been produced by several other independent modeling groups, increase our confidence in the observational record and our understanding of how global mean temperature has changed. They also indicate the time 

histories of the important forcings are reasonably known, and the climate processes 

being simulated in models are adequate enough to make the models very valuable 

tools for investigating the causes and processes of past climate variations as well 

future climate change. 

Question 2. We received testimony that sought to distinguish between average 

global temperature changes causes primarily by anthropogenic emissions and local/

regional temperature changes caused at times by natural variation. Please explain 

in greater detail. 

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Answer. Global average temperature increases in recent decades are primarily 

due to changes in anthropogenic forcings (Question 1). Evidence for a warmer world 

is also reflected in other independent measures as well, as documented in my written testimony. Some of these are regional in character, such as: (1) the rapid melting of glaciers in non-polar regions around the world; (2) decreases in the areal coverage and thickness of Arctic sea ice, especially during summer, and of snow cover 

over northern continents; and (3) reductions of a few weeks in the annual duration 

of northern lake and river ice cover. Yet, in spite of this and other evidence (e.g., 

rises in global sea levels) that gives a collective picture of a warming world, the 

magnitude of the anthropogenic influence on regional climate remains uncertain. A 

principal reason is because the effects of human activities are superimposed on the 

background ‘‘noise’’ of natural climate variability, which can be very large regionally. 

Global warming does not mean that temperature increases are spatially uniform 

or monotonic: some places warm more than the average and some places cool. Land 

regions have warmed the most (0.7° C since 1979), with the greatest warming in 

the boreal winter and spring months over the Northern Hemisphere (NH) continents. Regionally, winter (December through March) temperatures have been 1-2°

C warmer than average over much of North America and from Europe eastward to 

Asia over the past two decades, while temperatures over the northern oceans have 

not warmed as much (Figure 2). This pattern is strongly related to decade-long 

changes in natural patterns (or modes) of the atmospheric and oceanic circulation. 

In particular, changes in the behavior of the El Nin ̃ o/Southern Oscillation (ENSO) 

phenomenon and the Pacific Decadal Oscillation (PDO) have contributed substantially to the regional cooling of the North Pacific Ocean and the warming over western parts of North America, while changes in the behavior of the North Atlantic Oscillation (NAO) have driven much of the warming over Europe and Asia. 

Changes in anthropogenic forcing may affect these modes, however, so quantifying 

the anthropogenic and natural components of the observed warming on regional 

scales remains a difficult and critical research question. For instance, several recent 

studies have concluded the temporal behavior of the NAO in recent decades is outside the range of natural variability, and moreover that this unusual recent behavior is linked to the (anthropogenic) warming of the tropical oceans. Similarly, some 

have argued that the recent behavior of ENSO is inconsistent with natural variability. Yet, attribution remains uncertain. 

Many global climate models, for instance, project changes in the statistics of 

ENSO variability with global warming, specifically of greater ENSO activity marked 

by larger interannual variations relative to the warmer mean state. More El Nin ̃ o 

events would increase the probability of weather regimes that favor the regional 

patterns in Figure 2; yet, the details of ENSO are not well enough simulated in climate models to have full confidence in these projected changes, in part because the 

positive atmosphere-ocean feedbacks involved with ENSO mean that small errors in 

simulating the relevant processes can be amplified. 

Thus, while it is likely that changes in ENSO, the NAO and other natural modes 

of climate variability will occur as a result of anthropogenic climate change, their 

nature, how large and rapid they will be, and their implications for regional climate 

change around the world remain uncertain. 

Question 3. Please explain the meaning of ‘scientific consensus’ and comment on 

the status of the science of climate change in the scientific and academic community. 

Answer. A key aspect to scientific consensus is the building of a consensus and, 

thus, the process. In the case of the Intergovernmental Panel on Climate Change 

(IPCC), the process is very open and inclusive. 

The mandate of IPCC is to provide policy makers with an objective assessment 

of the scientific and technical information available about climate change, its environmental and socio-economic impacts, and possible response options. The IPCC reports on the science of global climate change and the effects of human activities on 

climate in particular. Each new IPCC report reviews all the published literature 

over the previous 5 years or so, and assesses the state of knowledge, while trying 

to reconcile disparate claims, resolve discrepancies and document uncertainties. For 

the 2001 Third Assessment Report (TAR), Working Group I (which deals with how 

the climate has changed and the possible causes) consisted of 123 lead authors, 516 

contributors, 21 review editors, and over 700 reviewers. The lead authors all have 

to be satisfied with the content of the report and the wording. There are also several 

independent reviews at various stages, including a full governmental review, and all 

comments must be addressed and documented by the review editors. Final approval 

is through an intergovernmental meeting. This means that the report cannot be seVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00130 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
127

lective in what it deals with. It is a very credible document, and very much represents a consensus. 

The TAR concluded that climate is changing in ways that cannot be accounted for 

by natural variability and that ‘‘global warming’’ is happening. There are still and 

will always be climate change skeptics, but the vast majority of reputable scientists 

accept and agree with the major conclusions of the IPCC reports. 

Question 4. What is ‘‘abrupt climate change?’’ Can you identify any potential 

thresholds that might be crossed if insufficient action is taken to control CO2 emissions? For example, I have heard that beyond certain temperature increases, large 

ice sheets could collapse, leading to huge increases in sea level. Can you comment 

on this and other potential thresholds? 

Answer. There is an abundance of scientific evidence that shows major and widespread climate changes have occurred with startling speed. For example, roughly 

half of the warming of the North Atlantic Ocean since the last ice age was achieved 

in only a decade, and this warming was accompanied by significant changes in climate across most of the globe. Research over the past decade has shown that these 

abrupt—or nonlinear—climate changes have been especially common when the climate system was being forced to change most rapidly. Thus, the rate of buildup of 

carbon dioxide in the atmosphere may increase the possibility of large, abrupt and 

unwelcome regional or global climate events. 

The mechanisms of past abrupt climate changes are not yet fully understood, and 

climate models typically underestimate the size, speed and extent of those changes. 

Hence, future abrupt changes cannot be predicted with confidence. Yet, because of 

greenhouse warming and other human alterations of the earth system, and the long 

lifetime of carbon dioxide in the atmosphere, certain thresholds are likely to be 

crossed and we will not know we have crossed them until it is too late to alter the 

outcome. 

So what can we do in the face of such uncertainty? Someone recently brought to 

my attention the analogy of buying insurance. One does this not because it lessens 

the chance of some terrible event, but because it smoothes out the financial impacts 

if a catastrophic event does occur. In the case of abrupt changes in climate, buying 

insurance—in the form of sound climate policy—not only reduces the risk of severe 

climate impacts but also smoothes out the risk of having to make abrupt changes 

in policy, which we know are costly. 

Question 5. Can you tell us something about the time horizon for stabilizing climate, given how long carbon dioxide remains in the atmosphere? Do we need to 

begin to control emissions now or can we wait? 

Answer. Because of the long lifetime of carbon dioxide and the slow equilibration 

of the oceans, there is a substantial future commitment to further global climate 

change even in the absence of further emissions of greenhouse gases into the atmosphere. Several modeling groups have performed ‘‘commitment’’ runs in order to examine the climate response even if the concentrations of greenhouse gases in the 

atmosphere had been stabilized in the year 2000. The exact results depend upon the 

model, but they all show a further global warming of about another 0.5° C, and additional and significant sea level rises caused by thermal expansion of the oceans 

by the end of the 21st century. Further glacial melt is also likely. 

There is now also better quantification of the climate system response to different 

emission scenarios (stabilization at 550, 690 and 820 ppmv concentrations of carbon 

dioxide by the year 2100). All global climate models contributing the Fourth IPCC 

Assessment Report (due to be published in 2007), for instance, produce similar 

warming trends in global surface temperatures over the next few decades, regardless of the emissions scenario. Moreover, nearly half of the early 21st century climate change arises from warming we are already committed to. By mid-century, the 

choice of scenario becomes more important for the magnitude of warming, and by 

the end of the 21st century there are clear consequences for which scenario is followed. 

Question 6. Given that there is still some uncertainty about the details of future 

warming, how should such uncertainty be dealt with in designing policy responses? 

Answer. There is indeed uncertainty in the details of future warming. Climate 

models are not perfect, and uncertainties remain. For instance, the precise nature 

of aerosol/cloud interactions and how aerosols interact with the water cycle remains 

a major uncertainty in our understanding of climate processes and, thus, their representation in models. Yet, the ability of these models to simulate the past record 

(Figure 1) means that the processes being simulated are adequate enough to make 

the models very valuable tools. Moreover, in spite of uncertainties and differences 

among models, they produce a number of consistent results concerning future climate change (see Question 5 as well as my written testimony). 

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Based on this and other evidence, I believe there is a clear need to begin to reduce 

emissions immediately. While some changes arising from global warming might be 

benign or even beneficial, the rate of change projected exceeds anything seen in nature in the past 10,000 years and is apt to be disruptive in many ways. Economists 

have analyzed the costs of various policy responses and they tell us that the most 

cost-effective emission trajectories involve starting now to control emissions. Further 

delay will be costly. 

Question 7. How do we know that emissions of carbon dioxide and other greenhouse gases are causing Earth’s temperature to rise, as opposed to other factors that 

we have no control over; such as sun spots? Some assert that an increase in solar 

irradiance is the main cause of the Earth’s current warming trend. Therefore, reducing fossil fuel emissions would not impact the Earth’s temperature. 

Answer. Although there is little doubt that the sun’s radiant output impacts the 

Earth’s climate on both decadal and centennial time scales, there is no credible evidence to suggest that an increase in solar irradiance is the main cause for the recent 

warming trend. This is addressed in my response to Question 1. 

Question 8a. There are some who question the veracity of the assertion that the 

earth has warmed substantially over the last century. Arguments typically fall into 

three categories. It would be useful if you would address each in turn: 

Urban Heat Island Effect. This is the claim that the underlying temperature data 

is tainted by the proximity of data-generating thermometers to cities. As urban 

areas have grown over the last fifty years, the air temperatures around these cities 

have increased due to larger amounts of heat generating substances like rooftops 

and roadways. Scientists claim to have corrected for the urban heat island effect. 

How was this done, and how can we be sure that it was done correctly? 

Answer. While amplified warming does occur in cities and is an important local 

phenomenon, a number of independent and recent studies have shown that urbanization is a negligible effect as far as continental-and hemispheric-space averages 

are concerned. Over land, temperature data come from fixed weather observing stations with thermometers housed in special instrument shelters. Records of temperature from many thousands of such stations exist. Some are in urban areas. Many 

are not. 

One concern regarding the construction of global temperature records is the variety of changes that may affect temperature measurements at an individual station. 

For example, the thermometer or instrument shelter might change, the time of day 

when the thermometers are read might change, or the station might move. These 

problems are addressed through a variety of procedures (for example, checking for 

consistency with data from neighboring stations) that have proven to be very effective. Other, perhaps more subtle influences (e.g., urbanization) are addressed either 

actively in the data processing stage or through dataset evaluation to ensure as 

much as possible that the data are not biased. For instance, several studies have 

compared global surface temperature time series made up of only rural stations 

with the ‘‘standard’’ global temperature time series, only to find out that there is 

no significant bias. The IPCC (2001) stated that urban heat island effects could contribute no more than six percent of the rising average temperature trends in recent 

decades, and a National Academy study of the surface temperature record concluded 

that the global surface temperature trend accurately reflects warming. 

Question 8b. Satellite and Airborne Balloon Data Contradict Surface Temperature 

Readings. Global mean temperature at the earth’s surface is estimated to have risen 

by about half a degree F over the last two decades. On the other hand, satellite 

measurements of radiances and airborne balloon observations indicate that the temperature of the lower to mid-troposphere (the atmospheric layer extending from the 

earth’s surface up to about 8 km) has exhibited almost no change during this period. 

Please explain whether this discrepancy is, indeed, real and how to account for it. 

Answer. I argue that there is no contradiction, and the reasons why are provided 

in my written testimony. There are several key points:

• The satellite and surface data differ in what they measure: surface thermometers measure the air temperature at the Earth’s surface, while the satellite 

measurements in question infer temperatures of different broad layers of the atmosphere which respond differently to natural climate variations such as 

ENSO, greenhouse gases and other factors that influence climate. 

• A chronic difficulty in obtaining reliable climate records from satellites has been 

changes in instruments, platforms, equator-crossing times, and algorithms. The 

microwave sounding unit (MSU) tropospheric temperature record has overcome 

some of these problems, but how transitions between different satellites are 

dealt with and other biases in the data result in a range of global trend estimates. Several groups have analyzed the data, and over 1979-2004 all data 

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versions show warming; however, the trend estimates range from 0.04 to 0.17°

C decade¥1. Such differences highlight the issue of temporal homogeneity in the 

satellite data. 

• Because about 15% of the MSU signal for middle tropospheric temperature actually comes from the lower stratosphere, the real warming of the middle troposphere is greater than that indicated by the MSU data sets. This has been confirmed by new analyses that explicitly remove the stratospheric influence, 

which is about ¥0.08° C decade¥1 on middle tropospheric MSU temperature 

trends since 1979. 

• By differencing MSU measurements made at different slant angles, new data 

records can be created that are weighted more toward the lower troposphere. 

The latest product exhibits a warming trend that is 0.2° C decade¥1 larger in 

the tropics (where the largest ‘‘discrepancy’’ with surface warming has been 

noted) than previous estimates. The result is tropical warming consistent with 

that found in surface measurements, and consistent with the warming produced 

by climate models. 

• Radiosonde releases provide the longest record of upper-air measurements, and 

these data exhibit similar warming rates to the surface record since 1958. Unfortunately, vast regions of the oceans and portions of the landmasses (especially in the tropics) are not monitored so that there is always a component of 

the global or hemispheric mean temperature that is missing. Moreover, measurement errors and sampling issues affect the radiosonde record as well. The 

correction for non-climatic effects in these records has not received as much attention as for the surface records, but efforts are increasing. A recent study, for 

instance, finds that after accounting for previously uncorrected errors due to 

daytime solar heating of the radiosonde instruments, the tropical troposphere 

has warmed at a rate (0.14° C decade¥1) consistent with model simulations and 

the surface record.

Question 8c. The Hockey Stick. In recent months, there have been assertions that 

the statistical method used to analyze global temperature data for the last several 

hundred years was biased towards generating the ‘‘hockey stick’’ shaped curve that 

shows sustained low and stable temperatures for hundreds of years with an extremely sharp rise in the last 100 years. Can you comment on whether the observations depicted in the hockey stick curve are, indeed, legitimate? 

Answer. An important point is that the ‘‘hockey stick’’ curve does not serve as the 

basis for the scientific consensus that the planet is warming and that this warming 

is due to human activities. A very large number of independent studies have led 

to this conclusion. 

That said, the results of the original ‘‘hockey stick’’ graph (Mann et al. 1998; Nature) are legitimate and remain as a valuable estimate inside the set of available 

climate reconstructions of past centuries. Not all reconstructions agree in the details, but their primary structure is very similar throughout and they agree with 

our understanding of possible forcing factors, both natural and anthropogenic. 

Without going into detail, the recent criticisms raised against the statistical method used in Mann et al. (1998) either refer to very small effects or they cannot be 

supported. New investigations into the summaries of North American tree rings 

show that, independent of the exact procedure used in the summary of the individual series, all methods lead to essentially the same result as the original Mann 

et al. (1998) reconstruction. Strongly differing results can only be achieved if a significant portion of the climatic signal in the original proxy records is omitted (which, 

of course, is not desirable). Questions regarding the potential for a very large bias 

in the century-scale climate amplitude of the Mann et al. (1998) reconstruction (von 

Storch et al. 2004; Science) cannot be reproduced with a code that is verified on the 

real proxy data. Papers addressing these issues and confirming the validity of the 

Mann et al. (1998) findings are currently in the peer-review process. 

Question 9. Some say that global warming might be a positive development? Will 

agricultural crop productivity improve due to the greater amount of CO2 in the atmosphere, and can we expect the Arctic and Antarctic regions to become more habitable? 

Answer. Modest amounts of warming will have both positive and negative impacts. The effects of climate change on agricultural productivity depend on numerous inter-related factors, including rising temperatures, increased carbon dioxide in 

the atmosphere, and average precipitation levels. A modest increase in global temperatures could increase agricultural productivity in some areas by, for instance, 

lengthening the growing season. As stated earlier, however, the rate of change projected exceeds anything seen in nature in the past 10,000 years and is apt to be 

disruptive in many ways. For instance, there is likely to be an amplified change in 

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extremes associated with global warming. Extreme events, such as heat waves, 

floods and droughts, are exceedingly important to both natural systems and human 

systems and infrastructure. 

Concerning high latitude regions, where the warming is expected to be greatest, 

there is already strong evidence to suggest the current warming is having strong 

negative impacts. One example is severe coastal erosion due to retreating sea ice, 

increasing sea level, and thawing of coastal permafrost. Others include negative impacts to buildings, roads, and industry due to thawing of tundra and ice roads. Increases in insect outbreaks and forest fires also accompany ongoing warming. So the 

evidence is strong that the negative impacts are very likely to outweigh positive 

ones as rapid warming proceeds. 

Question 10. It is my understanding that the assessments of the progression of 

global warming through the next century and its impacts on changing the Earth’s 

climate are largely based on computer modeling. It goes without saying that the 

planet’s atmospheric, hydrologic, and meteorological systems are highly complicated. 

What can you say about how climate modeling capabilities have advanced since scientists began evaluating the problem? What is the level confidence that the computer models are providing useful projections of the future climate? 

Answer. The best climate models encapsulate the current understanding of the 

physical processes involved in the climate system, the interactions, and the performance of the system as a whole. They have been extensively tested and evaluated 

using observations. They are exceedingly useful tools for carrying out numerical climate experiments, but they are not perfect, and some models are better than others. 

Uncertainties arise from shortcomings in our understanding of climate processes operating in the atmosphere, ocean, land and cryosphere, and how to best represent 

those processes in models. Yet, in spite of these uncertainties, today’s best climate 

models are now able to reproduce the climate of the past century (Figure 1), and 

simulations of the evolution of global surface temperature over the past millennium 

are consistent with paleoclimate reconstructions. This gives increased confidence in 

future projections. 

The shortcomings in our understanding of the processes involved in climate and 

how they are depicted in models arise from inadequate observations and theoretical 

underpinnings associated with the incredible complexity of dealing with scales from 

molecules and cloud droplets to the planetary-scale atmospheric circulation. These 

issues are addressed in several steps:

• Individual climate processes are dealt with as best as is possible given the understanding and computational limitations. 

• The processes are assembled in models and then the model components are 

tested with strong constraints. The components include modules of the atmosphere, the oceans, the land and sea ice, and the land surface. These modules 

are coupled together to mimic the real world. 

• The climate system model as a whole is then integrated in an unconstrained 

mode and thoroughly tested against observations.

One strong test is to simulate the annual cycle of seasonal variations (the changes 

in climate from winter to summer). Another is to simulate observed variability from 

one year to the next. Yet another is to simulate past climate (Figure 1), even going 

back in time thousands or millions of years tested against records from ice cores, 

tree rings, and other ‘‘proxy’’ data. 

As our knowledge of the different components of the climate system and their 

interactions increases, so does the complexity of today’s climate models. Also, many 

of the most pressing scientific questions regarding the climate system and its response to natural and anthropogenic forcings cannot be readily addressed with traditional models of the physical climate. One of the open issues for near-term climate 

change, for example, is the response of terrestrial ecosystems to increased concentrations of carbon dioxide. Will plants begin releasing carbon dioxide to the atmosphere in a warmer climate, thereby acting as a positive feedback, or will vegetation absorb more carbon dioxide and hence decelerate global warming? Related 

issues include the interactions among land use change, deforestation by biomass 

burning, emission of greenhouse gases and aerosols, weathering of rocks, carbon in 

soils, and marine biogeochemistry. 

Exploration of these questions requires a more comprehensive treatment of the integrative Earth system. In order to address these emerging issues, physical models 

are being extended to include the interactions of climate with biogeochemistry, atmospheric chemistry, ecosystems, glaciers and ice sheets, and anthropogenic environmental change. These new ‘‘Earth System Models’’, however, will require large 

investments in computing infrastructure before they can be fully utilized. 

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Question 11. Is the recent rise in global temperature within the scope of natural 

variation? For instance, it has been observed that the world appears to be on a cyclical temperature pattern of rising and falling into and out of ice ages every several 

hundred thousand years or so. What has caused global temperatures to vary naturally by 5 to 7 degrees thousands of years ago before humankind started burning 

fossil fuels and releasing large amounts of carbon dioxide and other greenhouse 

gases? 

Answer. Climate varies naturally. We consider natural variability as resulting 

from purely internal atmospheric processes as well as from interactions among the 

different components of the climate system, such as those between the atmosphere 

and oceans or the atmosphere and land. However, the most significant forcings with 

impact on climatic time scales are generally imposed upon the climate system. 

External forcings arise from a wide array of processes covering a range of spatial 

and temporal scales. ‘‘Natural’’ external forcings include changes in the global configuration of the continents, the slow increase of solar luminosity that occur over 

hundreds of millions of years, variations in the Earth’s orbit, and the injection of 

aerosols high into the atmosphere by explosive volcanic eruptions. Human emissions 

of carbon dioxide and other greenhouse gases, the local emission and suspension of 

small (aerosol) particles on timescales of minutes to days, and changes in land use 

are some examples of anthropogenic forcings. 

The global temperature variations reflected in ice core records from the distant 

past reflect the influence of natural external forcings on the climate system. However, these reconstructions of past temperature swings have also demonstrated that 

the projected rate of global temperature change exceeds anything seen in nature in 

the past 10,000 years. 

Greenhouse gas concentrations in the atmosphere are now higher than at any 

time in at least the last 750,000 years. It took at least 10,000 years from the end 

of the last ice age for levels of carbon dioxide to increase 100 ppmv to 280 ppmv, 

but that same increase has occurred over only the past 150 years to current values 

of over 370 ppmv. About half of that increase has occurred over the last 35 years, 

owing mainly to combustion of fossil fuels and deforestation. In the absence of controls, future projections are that the rate of increase in carbon dioxide amount may 

accelerate, and concentrations could double from pre-industrial values within the 

next 50 to 100 years. 

RESPONSES OF JAMES W. HURRELL TO QUESTIONS FROM SENATOR BUNNING

Question 1. Would you say that the steps America has taken in the recent years 

to improve energy efficiency and produce lower carbon emissions from power generation are the right first steps in addressing climate change? Within that construct, 

given the current U.S. electricity supply that is more than 50% derived from coal, 

is encouraging clean coal technology, IGCC and carbon sequestration the most important immediate policy action we can take? 

Answer. The only way to minimize human-induced climate change is to reduce 

emissions or increase removal of greenhouse gases from the atmosphere. Reducing 

carbon dioxide emissions from power generation is thus a very important step in addressing climate change. Improving energy efficiency is also desirable. 

Regarding the second part of your question, I am not an expert in energy technology, policy or economics. But regarding carbon sequestration, one of the major 

advances in climate modeling in recent years has been the introduction of coupled 

climate-carbon models. Climate change is expected to influence the capacities of the 

land and oceans to act as repositories for anthropogenic carbon dioxide, and hence 

provide a feedback to climate change. These models now allow us to assess the nature of this feedback. 

Results show that carbon sink strengths are inversely related to the rate of fossil 

fuel emissions, so that carbon storage capacities of the land and oceans decrease and 

climate warming accelerates with faster carbon dioxide emissions. Furthermore, 

there is a positive feedback between the carbon and climate systems, so that further 

warming acts to increase the airborne fraction of anthropogenic carbon dioxide and 

amplify the climate change. 

As a non-expert on energy technology, I can only add that experts believe a portfolio of technologies now exists to meet the world’s energy needs over the next 50 

years and limit the trajectory of atmospheric carbon dioxide increases. No single element of this portfolio (e.g., nuclear power, efficient baseload coal plants, efficient vehicles, etc.) can do the entire job by itself. 

Question 2. Scientific research shows that mitigation actions taken now mainly 

have benefits 50 years from now. Dr. Hurrell, you said ‘‘it is vital that all nations 

identify cost-effective steps that they can take now.’’ Given that viewpoint, do you 

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agree that clean coal technology, renewable fuels and nuclear power are the most 

promising areas the government can spend research dollars? 

Answer. I cannot suggest which energy technologies should receive greatest emphasis in the near-term because I am not an expert in energy technology or policy. 

However, as noted above, I believe it is essential to encourage technological innovation and explore the entire spectrum of energy generating technologies, including 

nuclear, clean coal, and renewable fuels. 

Question 3. While you have presented what appears to be a united scientific front 

in the form of the statement from the academies of science from 11 countries, I am 

concerned by some of the news since the release of that statement. The Russian 

Academy of Sciences says it was misrepresented and that Russian scientists actually believe that the Kyoto Protocol was scientifically ungrounded. I am also aware 

that there was a significant misrepresentation on the science between our academy 

and the British representative. Given this background, wouldn’t you say there are 

still some pretty fundamental disagreements about the science of climate change 

among scientists around the world? 

Answer. As outlined in my written testimony, I do not believe there are fundamental disagreements about the science of climate change. Please also see my response to Question 3 from Senator Bingaman. There is overwhelming agreement 

among climate scientists that human activities are increasing the concentrations of 

greenhouse gases in the atmosphere and that this is resulting in significant changes 

to Earth’s climate. 

I therefore believe the academies statement accurately represents the current 

state of scientific understanding of climate change. However, I was not involved in 

the process of generating the statement, and I respectfully suggest that further concerns are most appropriately addressed to representatives of the U.S. National 

Academy. 

Question 4. In this international academies statement, you find that an ‘‘immediate response that will, at a reasonable cost, prevent dangerous anthropogenic interference with the climate system,’’ but continue to say in the following paragraph, 

‘‘minimizing the amount of this carbon dioxide reaching the atmosphere presents a 

huge challenge.’’ Could you please elaborate, since any response can’t both be a ‘‘reasonable cost’’ and a ‘‘huge challenge’’ proposition, how you resolve the two? 

Answer. Again, I respectfully suggest that questions about the international academies statement are most appropriately addressed to those who drafted and issued 

the statement. I would point out that the challenge of dealing with climate change 

involves much more than financial costs. One aspect of this challenge is the very 

long-term nature of climate change. The emissions of greenhouse gases that have 

already occurred will result in climate changes that play out for decades, or, in the 

case of sea-level rise, over centuries. We will thus need to devise and maintain 

multi-generational mitigation and adaptation strategies. I believe that this can be 

properly characterized as a huge challenge quite apart from the issue of financial 

costs. 

Question 5. Several scientists have cited events like the high temperatures in Europe in the summer of 2003 and increased storminess in the 1980s and 1990s as 

evidence of climate change. Don’t global ecosystems go through natural periods similar to these as well? 

Answer. Climate varies naturally from both internal processes and from changes 

in ‘‘natural’’ external forcing (see my response to Question 11 from Senator Bingaman). However, the critical point is that the projected rate of global temperature 

change exceeds anything seen in nature in the past 10,000 years, and it is unlikely 

many natural systems can adapt. An example is the coral reefs, which some scientists believe are already beyond a point of recovery as a result of ocean warming. 

Greenhouse gas concentrations in the atmosphere are now higher than at any time 

in at least the last 750,000 years, with very rapid increases in recent decades owing 

to mainly the combustion of fossil fuels and deforestation. In the absence of controls, 

future projections are that the rate of increase in carbon dioxide amount may accelerate, and concentrations could double from pre-industrial values within the next 

50 to 100 years. Thus, we will experience climate conditions in the next 100 years 

that are very different from any experienced during the entire development of 

human society. 

Question 6. There are a number of astrophysicists and other scientists who believe 

that sunspots are a major contributor to changing temperatures. A recent survey 

showed at least 100 such studies are underway. Why don’t scientists put as much 

emphasis on this possibility or other aspects of natural climate variability as they 

do on emissions from human activity? 

Answer. Scientists put a tremendous effort on unraveling the complexities of the 

climate system, including the role that changes in natural external forcings (such 

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as changes in solar luminosity) have played in producing past variations in global 

surface temperature. Our understanding of the physical processes involved in the 

climate system is encapsulated in today’s climate system models, which are now 

able to reproduce the climate of the past century with impressive fidelity (see Figure 

1 and my response to Question 1 from Senator Bingaman). As a result, climate modelers are able to test the role of various forcings in producing the observed changes 

in global temperature. These simulations clearly indicate that the global surface 

warming of recent decades is a response to the increased concentrations of greenhouse gases and sulfate aerosols in the atmosphere. When the models are run without these forcing changes, and only include ‘‘natural’’ forcings from changes in solar 

irradiance and volcanic eruptions, they fail to capture the almost linear increase in 

global surface temperatures since the mid-1970s. 

Question 7. Much of the discussion about climate science being settled is based 

on the summary chapter of the Intergovernmental Panel on Climate Change of the 

United Nations. The chapter made specific predictions about the pace of rising temperatures and the relative importance of human activities to climate change. And 

yet, the body of the report is much more ambiguous and inconclusive about the current state of the science. Is anything being done to ensure that the summary of the 

next IPCC report is more reflective of the overall analysis by the scientists? 

Answer. I assume the question is referring to the Summary for Policy Makers 

(SPM), which is approved word-by-word and line-by-line in an Intergovernmental 

Meeting in which the U.S. Government fully participates. This summary involves 

negotiations about how the scientific findings are expressed, but it does not change 

the science on which it is based. There is also a Technical summary and executive 

summaries for each chapter. The report as a whole goes through a very rigorous review process (see my response to Question 3 from Senator Bingaman and also my 

written testimony for more details on the IPCC process). The openness of the entire 

process results in a very credible, consensus document. 

Question 8. The natural ‘‘greenhouse effect’’ has been known for nearly two hundred years and is essential to the provision of our current climate. There is significant research in the literature today that indicates humans, since the beginning of 

their existence, have caused an increase in the greenhouse effect. Some argue that 

the development of agriculture 6,000 to 8,000 years ago has helped to forestall the 

next ice age. The development of cities, thinning of forests, population growth, and 

most recently the burning of fossil fuels, have all had an impact on climate change. 

Our ecosystems have constantly adapted to change, as we as humans have adapted 

to our ecosystems as well. Is it possible that the increased presence of CO2 caused 

by the 8,000 years of modern human existence may be something our ecosystems 

will continue, as they previously have, to naturally adapt to? 

Answer. Ecosystems do not adapt to change. Individual species that make up ecosystems adapt to changing climate conditions, move, or go extinct. Ecosystems 

change as the mixture and characteristics of species within them change. In some 

cases, ecosystems disappear and are replaced by other ecosystems that contain different species and provide different services. 

It is true that a broad range of human activities, including land use change, 

thinning or removal of forests, and, more recently, the use of fossil fuels, have affected the Earth’s climate and ecosystems over the course of human history. But we 

are witnessing a unique period. 

Greenhouse gas concentrations in the atmosphere are now higher than at any 

time in at least the last 750,000 years. It took at least 10,000 years from the end 

of the last ice age for levels of carbon dioxide to increase 100 ppmv to 280 ppmv, 

but that same increase has occurred over only the past 150 years to current values 

of over 370 ppmv. About half of that increase has occurred over the last 35 years, 

owing mainly to combustion of fossil fuels and deforestation. In the absence of controls, future projections are that the rate of increase in carbon dioxide amount may 

accelerate, and concentrations could double from pre-industrial values within the 

next 50 to 100 years. The result is that the rate of change as projected exceeds anything seen in nature in the past 10,000 years. 

The rapid climate change that we are experiencing now is already affecting some 

ecosystems. The ranges of migrating birds and some fish and insect species are 

changing. Tropical regions are losing animal species, especially amphibians, to 

warming and drying, and coral reefs are dying because of excess ocean warmth. 

Continued rapid climate change is expected to result in significant ecosystem impacts over the next 100 years and beyond. Some plants and animals may be unable 

to adapt or migrate in response to such a rapidly changing climate. Rare ecosystems, like mangrove forests and alpine meadows, could disappear in some areas. 

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RESPONSES OF JAMES W. HURRELL TO QUESTIONS FROM SENATOR TALENT

Question 1. You note that most of the warming since 1979 has occurred in coldweather winter and spring months, and that only 0.7 degree Centigrade. Is there 

any harm in this? 

Answer.The warming has occurred in all seasons and over much of the globe, but 

not uniformly. Climate models used to project future climate indicate that the largest temperature increases will occur over land relative to oceans, with the greatest 

warming at high latitudes of the Northern Hemisphere during the winter and 

spring seasons—much like the pattern we are observing. Over portions of North 

America, Europe and Asia regional increases in average surface temperature since 

1979 have exceeded 1-2° C (see Figure 2 in my response to Senator Bingaman). 

Modest warming will have both positive and negative impacts. A modest increase 

in global temperatures could increase agricultural productivity in some areas by, for 

instance, lengthening the growing season. But in high latitude regions, where the 

warming is expected to be greatest, there is already strong evidence to suggest the 

current warming is having strong negative impacts, such as severe coastal erosion 

due to retreating sea ice, increasing sea level, and thawing of coastal permafrost. 

The thawing of tundra is having negative impacts on buildings, roads, and industry. 

Higher global sea levels associated with warmer ocean temperatures mean that 

storm surges associated with hurricanes will be more destructive. Moreover, the 

rate of future warming as projected exceeds anything seen in nature in the past 

10,000 years. 

Question 2. You also note that temperatures from 1861-1920 were constant, with 

a 0.3 degree Centigrade warming from 1921-1950, a cooling of 0.1 degree through 

the mid 1970s, followed by a warming of 0.55 degree through now. Doesn’t this 

imply temperature fluctuation more so than the usual argument of a constant increase in temperature? If nothing else, doesn’t it imply that nature causes of temperature change more than overtake those of human origin (since emissions have 

generally been increasing throughout the Industrial Age and didn’t drop off in the 

50s, 60s, and 70s)? 

Answer. Global average surface temperatures show a linear warming trend of 0.6°

C ± 0.2° C since the beginning of the 20th century. Linear trends are a simple way 

to summarize the change in a time series over some period of time. In my written 

testimony, I was noting that the change in observed global surface temperatures is 

more complex than a simple linear trend value would indicate (see Figure 1 in my 

response to Senator Bingaman). 

You are correct to note that natural variations are evident in the global surface 

temperature record. Natural variations result from purely internal atmospheric 

processes as well as from interactions among the different components of the climate system, such as those between the atmosphere and ocean associated with the 

El Nin ̃ o/Southern Oscillation (ENSO) phenomenon in the tropical Pacific. Changes 

in solar luminosity and the injection of aerosols high into the atmosphere by explosive volcanic eruptions are also considered to be ‘‘natural’’ external forcings. Many 

of the large amplitude year-to-year fluctuations evident in Figure 1 reflect ENSO, 

volcanic eruptions and other variations associated with natural variability. Natural 

variations also affect temperatures on longer time scales, for instance associated 

with multi-decadal variations in the Meridional Overturning Circulation (MOC) in 

the ocean. 

Climate models, when forced with known changes in natural external forcings, 

produce variations in global surface temperatures that mimic observations; yet, 

these simulations fail to reproduce the observed warming over recent decades (Figure 1). The recent warming (which, incidentally, is well described by a linear trend) 

can only be captured when known changes in anthropogenic forcings are added to 

the models as well. This result, combined with many other pieces of knowledge 

(summarized in my written testimony), led the IPCC to conclude in its third assessment report that ‘‘most of the warming observed over the last 50 years is attributable 

to human activities.’’ The best assessment of global warming remains that the 

human climate signal emerged from the noise of background variability in the late 

1970s. 

Question 3. You add that the National Research Council in 2000 studied the problem and concluded that ‘‘the warming trend in global-mean surface temperature observations during the past 20 years is undoubtedly real and is substantially greater 

than the average rate of warming during the 20th century. The disparity between 

surface and upper air trends in no way invalidates the conclusion that surface temperature has been rising.’’ Please explain the basis for the strong NRC position in 

the face of remaining data discrepancies. 

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Answer. Please see both my written testimony and my answer to Question 8 from 

Senator Bingaman for more relevant details. In short, initial analyses of satellite 

data that measure the temperature of broad atmospheric layers indicated that temperatures in the troposphere showed little or no warming, in stark contrast with 

surface air measurements. Climate change skeptics used this result to raise questions about the reliability of the surface record. The NRC report, however, did not 

find this to be the case. It, like the IPCC assessments and many independent studies in the refereed literature, concluded that, while the surface record is not perfect, 

it does depict large-scale changes in surface temperature to a high level of certainty. 

Independent analyses of global upper-air temperatures derived from satellites also 

show warming since 1979, when the satellite record begins. However, trend estimates range from 0.04 to 0.17° C decade¥1. Such differences highlight the issue of 

temporal homogeneity in the satellite data. 

Question 4. You note that even if we would have stabilized our emissions as of 

2000, temperatures would still increase by 0.5 degree C by 2100. What level of emissions reductions would be needed (and when) in the U.S. and world-wide to accomplish this? If developing nations do not participate (as we expect they won’t) and 

in fact increase their emissions (as we expect they will), what greater level of reductions would the U.S. have to make? 

Answer. The first part of your question refers to the so-called ‘‘commitment’’ runs 

performed by several modeling groups around the world in order to examine the climate response if there are no further increases in global emissions of greenhouse 

gases into the atmosphere. So, effectively, no additional reductions are required for 

this emission scenario to be realized. However, as you note, further increases in 

emissions are likely, especially as countries like China and India strive to reach a 

standard of living similar to ours. 

The second question is beyond my expertise. I do note, however, the CO2 emissions reductions necessary to achieve a given target depend on the quantitative details of the stabilization target, the emissions judged likely to occur in the absence 

of a focus on carbon (a business-as-usual trajectory), and how natural sinks for atmospheric CO2 will behave (see also my response to Question 1 from Senator 

Bunning). For reference, Pacala and Socolow (2004, Science) note that stabilization 

at 500 ppmv (the current CO2 concentration is near 375 ppmv) requires that emissions be held near current levels (7 GtC year¥1) for the next 50 years, even though 

they are currently on a doubling path. This is because greenhouse gases have very 

long atmospheric lifetimes. They build up in amounts over time, as has been observed. 

Question 5. You note that the benefits of actions taken today won’t appear for 50 

years or more. Can you even quantify those benefits, or offer any degree of certainty 

that they will be realized? Will they even materialize unless we take the drastic action of reducing emissions to 2000 levels (or lower)? 

Answer. I note in my written testimony that ‘‘it should be recognized that mitigation actions taken now mainly have benefits 50 years and beyond now.’’ Again, this 

statement refers to the long lifetime of CO2 in the atmosphere and the slow equilibration of the oceans, so that there is a substantial future commitment to further 

global climate change even in the absence of further emissions of greenhouse gases 

into the atmosphere. The consequence of inaction is that the rate of increase in carbon dioxide amount may accelerate, and concentrations could double from pre-industrial values within the next 50 to 100 years. The resulting very rapid rate of climate 

change is apt to be disruptive in many ways, as summarized by the IPCC and elsewhere. 

Question 6. If all the countries that have signed Kyoto stay within compliance of 

Kyoto, how much of a reduction in global warming would this result in? 

Answer. If the Kyoto Protocol had gone into effect with the U.S. included, studies 

indicate that, under reasonable assumptions, it would delay the doubling of carbon 

dioxide concentrations in the atmosphere by about 15 years (from about 2060 to 

2075). This result, however, depends greatly on what is done after 2012. Without 

U.S. involvement, the gain is closer to 10 years. 

Question 7. Can you confirm that suspended water vapor levels, cloud cover percentages and direct solar irradiation changes over time all represent variables in 

these forecasting models that could have significant impacts on the conclusions of 

the results of these models? 

Answer. The best climate models encapsulate the current understanding of the 

physical processes involved in the climate system, the interactions, and the performance of the system as a whole. They have been extensively tested and evaluated 

using observations. They are exceedingly useful tools for carrying out numerical climate experiments, but they are not perfect, and some models are better than others. 

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Water vapor, cloud, and solar radiation are all dealt with in climate models, although there is considerable uncertainty associated with the depiction of cloud 

owing to its complexity. In fact, this is a major source of the uncertainty in future 

climate projections, and it is fully expressed in the projections of IPCC. In spite of 

differences among models and the uncertainties that exist, however, climate models 

produce some consistent results regarding future projections of climate, as detailed 

in my written testimony. For instance, regardless of the emissions scenario, all climate models produce very similar warming trends over the next few decades. 

Question 8. In looking at pre-industrial global temperature patterns, would you 

agree that changes in temperatures over time have occurred that had no anthropogenic basis? 

Answer. Yes. And this is true of today’s climate as well. Please see my answer 

to your Question 2.

Question 9. Do we know what the ‘‘best’’ global temperature is to sustain life? 

Answer. It seems to me that the answer to this question will vary depending on 

the nature of life, whether biota, insects, mammals, or humans. The process of evolution guarantees that we are most adapted to the current or past climate. Life 

itself depends enormously on intricate webs and predator-prey relationships, so that 

if one link in the chain is upset it can propagate through the whole chain. Examples 

abound. These include how earlier springs lead to earlier hatching of insects but 

perhaps not birds. So, when the birds hatch, their traditional food is no longer available and they may be in jeopardy. This also happens with disruptions like drought. 

Drought dries up puddles and lakes and destroys the natural predators for mosquito 

larvae, so after a drought there is an expansion of mosquitoes and greater risk of 

outbreaks of vector borne disease such as malaria or Rift Valley fever. 

Question 10. What is currently being done to curb emissions from parts of the 

world in poverty who are deforesting their environment and burning biomass for all 

means of day-to-day living, and are these emissions continuing to increase in the 

world? 

Answer. I am not a policy expert, and I am not familiar with the policies of other 

nations. I cannot answer this question, beyond noting that deforestation and biomass burning is accelerating in many parts of the world. 

Question 11. Do you believe it is practical to seek emission controls in parts of 

the world that are struggling in poverty? 

Answer. My personal view it that it is vital that all nations identify cost-effective 

steps that they can take now, to contribute to substantial and long-term reductions 

in net global greenhouse gas emissions. Some countries can do more than others, 

but it is important that the science not be ignored while designing policies. 

Question 12. What is being done to curb emissions in the developing countries like 

China and India? 

Answer. Again, I am not a policy expert. I am unfamiliar with what is being done 

in countries like China and India to curb emissions, but I hope they are considering 

the diverse portfolio of energy technologies that exists now and can contribute toward stabilization strategies. 

RESPONSES OF JAMES W. HURRELL TO QUESTIONS FROM SENATOR FEINSTEIN

Question 1. Is there any credible scenario for stabilizing greenhouse gas emissions 

that does not involve the United States and other major emitters stopping their 

emissions growth over the next couple of decades and sharply reversing their emissions growth by 2050? 

Answer. The answer depends on the stabilization target as well as several other 

factors. Pacala and Socolow (2004, Science) note that stabilizing atmospheric concentrations of CO2 at 500 ppmv (the current CO2 concentration is near 375 ppmv) 

requires that global emissions be held near current levels (7 GtC year¥1) for the 

next 50 years, even though they are currently on a doubling path. Holding global 

emissions near current levels for the next 50 years would require that emissions 

growth in any particular nation or group of nations be matched by emissions reductions elsewhere. Such an effort requires full consideration of the diverse portfolio of 

energy technologies that exists. 

Question 2. Would the National Commission on Energy Policy’s proposal stop and 

then reverse U.S. greenhouse gas emissions? 

Answer. I am not familiar with the proposal you reference. I cannot comment. 

RESPONSES OF RALPH J. CICERONE TO QUESTIONS FROM SENATOR BINGAMAN

Question 1. Over the last several decades, anthropogenic emissions have ‘‘substantially contributed’’ to the increase in average global temperatures. Upon receiving 

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a question from one of the Senators, one of the panelists suggested that ‘‘80 percent’’ 

of the warming was due to human activities. Do all the panelists agree? Please provide information as to how this estimate was derived. 

Answer. I am not sure of the 80 percent number specifically, but I do agree that 

it is likely that most of the global mean surface temperature increase since the late 

1970s is due to human activities. This conclusion is consistent with that reached by 

Intergovernmental Panel on Climate Change (IPCC) in their 2001 assessment of the 

scientific literature and the 2001 report of the NRC Climate Change Science: An 

Analysis of Some Key Questions.

This conclusion is generally based on studies that compare the observed climate 

record from 1860 to today with global mean temperature simulated in three computational climate model scenarios:

1) Only natural variability (due to solar and volcanic variability) 

2) Only anthropogenic variability (due to greenhouse gases and aerosols) 

3) Both natural and anthropogenic variability

In these studies, the models run with only natural variability are unable to reproduce the warming observed since the late 1970s, typically showing no trend over 

this time period (e.g., Stott et al., 2000; Meehl et al., 2004). Thus, we conclude that 

human-caused climate forcings have disrupted Earth’s energy balance, causing an 

increase in global mean surface temperatures (NRC, 2005). 

Improved understanding of the natural variability of the climate system supports 

the conclusion that human activities are mostly responsible for global temperature 

increases of the past three decades. In particular, new studies of solar variability 

show that there has been little if any trend in the Sun’s brightness over the past 

25 years, ruling out solar variability as a major driver of observed warming (see Response to #7 for more details). 

Because of the still uncertain level of natural variability inherent in the climate 

record and the uncertainties in the time histories of the various forcing agents, a 

causal linkage between the buildup of greenhouse gases in the atmosphere and the 

observed climate changes during the 20th century cannot be unequivocally established. The fact that the magnitude of the observed warming is large in comparison 

to natural variability as simulated in climate models is suggestive of such a linkage, 

but it does not constitute incontrovertible proof of one because the model simulations could be deficient in natural variability on the decadal to century time scale. 

Question 2. We received testimony that sought to distinguish between average 

global temperature changes causes primarily by anthropogenic emissions and local/

regional temperature changes caused at times by natural variation. Please explain 

in greater detail. 

Answer. As discussed in the response to #1, there is good evidence that anthropogenic emissions of greenhouse gases are responsible for global mean increases in 

surface temperature that have been occurring since the late 1970s. It is more difficult to attribute changes observed on local and regional scales to anthropogenic 

causes because the range of natural climate variability is known to be quite large 

(in excess of several degrees Celsius) on these smaller spatial scales and shorter 

time scales and because global climate models have more skill in predicting climate 

for large regions and long time scales. Precipitation also can vary widely. For example, there is evidence to suggest that droughts as severe as the ‘‘dust bowl’’ of the 

1930s were much more common in the central United States during the 10th to 

14th centuries than they have been in the more recent record. Mean temperature 

variations at local sites have exceeded 10° C (18° F) in association with the repeated 

glacial advances and retreats that occurred over the course of the past million years. 

Question 3. Please explain the meaning of ‘scientific consensus’ and comment on 

the status of the science of climate change in the scientific and academic community. 

Answer. Scientific understanding is continually undergoing changes and refinements as hypotheses are tested and experiments are conducted. At any one time it 

is possible in various ways to test the degree of consensus that may exist about the 

state of scientific knowledge in a particular area and the degree of uncertainty that 

may exist. For example, the National Research Council has developed a process to 

produce its ‘‘consensus’’ reports regarding current scientific knowledge. The NRC 

process begins by selecting a committee of highly-qualified experts that represents 

the range of disciplines, expertise, and perspectives necessary to make an informed 

and objective assessment on the topic in question. The committee assembles data 

from a variety of sources, including the scientific literature, the testimony of other 

experts, and the public. Using these data, its own collective knowledge, and assessment of the existing scientific evidence, the committee conducts deliberations and 

writes a draft report of consensus findings with supporting arguments. Each comVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00141 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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mittee member must agree to all of the findings and recommendations in the report, 

although in rare cases a committee member can ask that a dissenting opinion be 

included. Each report is subjected to rigorous, anonymous review by a group of independent experts before it is approved in final form and released to the public. The 

National Research Council has issued a number of reports concerning the state of 

knowledge and uncertainties in climate change science. 

The climate science community has also developed additional processes for articulating consensus on the state of science, largely through the preparation of assessment reports. The largest and most well-known of climate assessment activities is 

conducted by the Intergovernmental Panel on Climate Change (IPCC), which has 

produced major assessments on a regular basis over the past 15 years. The most 

recent IPCC assessment of the science of climate change was published in 2001 

(IPCC, 2001). An NRC committee examined this assessment and found that the full 

IPCC Working Group I report is an admirable summary of research activities in climate science (NRC, 2001a). IPCC (2001) and NRC (2001a) both conclude that climate is changing and that the recent changes are likely due in large part to human 

activities. 

A less formal way of identifying a scientific consensus is by considering the 

breadth of the scientific literature and presentations at scientific conferences. For 

example, a recent analysis of over 900 papers published in refereed scientific journals between 1993 and 2003 with keywords ‘‘global climate change’’ concluded that 

there is a strong convergence of views in the scientific community that climate is 

changing and that recent warming is largely due to human activities (Oreskes, 

2004). 

Question 4. What is ‘‘abrupt climate change’’? Can you identify any potential 

thresholds that might be crossed if insufficient action is taken to control CO2 emissions? For example, I have heard that beyond certain temperature increases, large 

ice sheets could collapse, leading to huge increases in sea level. Can you comment 

on this and other potential thresholds? 

Answer. Abrupt climate change generally refers to a large shift in climate that 

takes place so rapidly and unexpectedly that human or natural systems have difficulty adapting to it. Such a climate shift can persist for years or longer—such as 

marked changes in average temperature, or altered patterns of storms, floods, or 

droughts—over a widespread area such as an entire country or continent, In the 

context of past abrupt climate change, ‘‘rapidly’’ typically means on the order of a 

decade (NRC, 2002). 

Abrupt climate change can occur when the Earth system gets pushed across a 

threshold, whether by some sudden event like a massive volcanic eruption or by the 

accumulation of more gradual changes in the climate system. It is not yet known 

what the thresholds are or whether human-induced increases in greenhouse gases 

will trigger abrupt climate changes. Scientists are concerned about increasing greenhouse gases because past abrupt climate changes have been especially common 

when the climate system itself was being altered. 

A question of great societal relevance is whether the North Atlantic circulation, 

including the Gulf Stream, will remain stable under the global warming that is expected to continue for the next few centuries. A shutdown of the circulation would 

not induce a new ice age, but would cause major changes both in the ocean (major 

circulation regimes, upwelling and sinking regions, distribution of seasonal sea ice, 

ecological systems, and sea level) and in the atmosphere (land-sea temperature contrast, and the intensity, frequency, and paths of storms). 

Other potential impacts of a global-warming induced abrupt climate change could 

be associated with increased frequency of extreme events related to land-surface hydrology. Great variability in precipitation patterns, ranging from heavy rainstorms 

and flooding to persistent drought, might become more common. In particular, some 

models suggest that greenhouse warming will cause El Nin ̃ o manifestations to become stronger and more frequent. It is important to note that not all models agree 

on the potential impacts of global warming on abrupt climate change. 

Question 5. Can you tell us something about the time horizon for stabilizing climate, given how long carbon dioxide remains in the atmosphere? Do we need to 

begin to control emissions now or can we wait? 

Answer. Carbon dioxide can remain in the atmosphere for many decades and 

major parts of the climate system respond slowly to changes in greenhouse gas concentrations. Although carbon dioxide is the most significant greenhouse gas perturbed by humans, other anthropogenic greenhouse gases also have an important 

impact on climate. These include (1) methane, for which concentrations have increased by about a factor of 2.5 since preindustrial times, but have stopped increasing more recently for unknown reasons; (2) halocarbons such as chlorofluorocarbons, 

139

* Figures 1-3 have been retained in committee files. 

whose emissions were controlled because they contribute to ozone depletion in the 

stratosphere; and (3) nitrous oxide, which continues to rise. 

Even if greenhouse gas levels were stabilized instantly at today’s levels, the climate would still continue to change as it adapts to the increased emissions of recent 

decades, as illustrated in Figure 1. For current models with a midrange climate sensitivity and average assumptions about the greenhouse effects of atmospheric 

aerosols, Wigley (2005) estimates next 400 years, with most of the warming occurring within the first 100 years (see the center red line in Figure 1*). Thus, even 

with no greenhouse gas emissions from this point forward, we would be experiencing 

the impacts of climate change throughout the 21st century and beyond. 

If it were possible to control emissions such that they stayed at today’s levels into 

the future, we would not be able to stabilize climate for at least 400 years, as illustrated in Figure 2. Failure to implement significant reductions in net greenhouse 

gas emissions now, will make the job much harder in the future. 

Question 6. Given that there is still some uncertainty about the details of future 

warming, how should such uncertainty be dealt with in designing policy responses? 

Answer. Pinpointing the magnitude of future warming is hindered both by remaining gaps in understanding the science and by the fact that it is difficult to predict society’s future actions, particularly in the areas of population growth, economic 

growth, and energy use practices. However, a lack of full scientific certainty about 

some aspects of climate change is not a reason for delaying an immediate response 

that will, at a reasonable cost, prevent dangerous anthropogenic interference with 

the climate system. Indeed, relevant policy actions that affect population growth, 

economic growth, energy use practices, and other societal factors will have an impact on future warming. 

Question 7. How do we know that emissions of carbon dioxide and other greenhouse gases are causing Earth’s temperature to rise, as opposed to other factors that 

we have no control over; such as sun spots? Some assert that an increase in solar 

irradiance is the main cause of the Earth’s current warming trend. Therefore, reducing fossil fuel emissions would not impact the Earth’s temperature. 

Answer. Please see the response to #1, which addresses how scientists attempt 

to determine the contributions of natural and human causes to observed climate 

change. 

The extent to which variations in the Sun might contribute to recent observed 

warming trends is an area of active research. The Sun’s brightness—its total irradiance—has been measured continuously by a series of satellite-based instruments for 

more than two complete 11-year solar cycles. These multiple solar irradiance 

datasets have been combined into a composite time series of daily total solar irradiance from 1979 to the present. Different assumptions about radiometer performance 

lead to different reconstructions for the past two decades. Recent analyses of these 

measurements, taking into account instrument calibration offsets and drifts, argue 

against any detectable long-term trend in the observed irradiance to date. Likewise, 

models of total solar irradiance variability that account for the influences of solar 

activity features—dark sunspots and bright faculae—do not predict a secular change 

in the past two decades. Thus, it is difficult to conclude from either measurements 

or models that the Sun has been responsible for the warming observed over the past 

25 years, although this hypothesis was more plausible before the availability of 

more recent evidence. 

Knowledge of solar irradiance variations prior to the commencement of continuous 

space-based irradiance observations in 1979 is rudimentary. Models of sunspot and 

facular influences developed from the contemporary database have been used to extrapolate daily variations during the 11-year cycle back to about 1950 using contemporary sunspot and facular proxies, and with less certainty annually to 1610. Circumstantial evidence from cosmogenic isotope proxies of solar activity (14C and 10Be) 

and plausible variations in Sun-like stars motivated an assumption of long-term secular irradiance trends, but recent work questions the evidence from both (Lean et 

al., 2002). Very recent studies of the long term evolution and transport of activity 

features using solar models suggest that secular solar irradiance variations may be 

limited in amplitude to about half the amplitude of the 11-year cycle. 

Question 8. There are some who question the veracity of the assertion that the 

earth has warmed substantially over the last century. Arguments typically fall into 

three categories. It would be useful if you would address each in turn: 

a. Urban Heat Island Effect. This is the claim that the underlying temperature 

data is tainted by the proximity of data-generating thermometers to cities. As urban 

areas have grown over the last fifty years, the air temperatures around these cities 

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have increased due to larger amounts of heat generating substances like rooftops 

and roadways. Scientists claim to have corrected for the urban heat island effect. 

b. Satellite and Airborne Balloon Data Contradict Surface Temperature Readings. 

Global mean temperature at the earth’s surface is estimated to have risen by about 

half a degree F over the last two decades. On the other hand, satellite measurements of radiances and airborne balloon observations indicate that the temperature 

of the lower to mid-troposphere (the atmospheric layer extending from the earth’s 

surface up to about 8 km) has exhibited almost no change during this period. 

c. The Hockey Stick. In recent months, there have been assertions that the statistical method used to analyze global temperature data for the last several hundred 

years was biased towards generating the ‘‘hockey stick’’ shaped curve that shows 

sustained low and stable temperatures for hundreds of years with an extremely 

sharp rise in the last 100 years. 

Question 8a. Urban Heat Island Effect. How was this done, and how can we be 

sure that it was done correctly? 

Answer. The possibility of extra heating associated with cities biasing the global 

mean temperature records is a legitimate concern, which scientists have researched 

over the past decade. The conclusion of this research is that estimates of long-term 

global land-surface air temperature trends are relatively little affected by whether 

or not the averaging includes urban stations. Urban effects on globally averaged 

land surface air temperatures do not exceed about 0.05° C over the period 1900 to 

1990, compared to an overall trend of about 0.7° C. This conclusion has been 

reached by comparing the trend at urban stations to that at rural stations (e.g., Peterson et al., 1999). 

Question 8b. Satellite and Airborne Balloon Data Contradict Surface Temperature 

Readings. Please explain whether this discrepancy is, indeed, real and how to account for it. 

Answer. A National Academies report released in 2000, Reconciling Observations 

of Global Temperature Change, examined different types of temperature measurements collected from 1979 to 1999 and concluded that the warming trend in globalaverage surface temperature observations during the previous 20 years is undoubtedly real and is substantially greater than the average rate of warming during the 

20th century. The report concludes that the lower atmosphere actually may have 

warmed much less rapidly than the surface from 1979 into the late 1990s, due both 

to natural causes (e.g., the sequence of volcanic eruptions that occurred within this 

particular 20-year period) and human activities (e.g., the cooling of the upper part 

of the troposphere resulting from ozone depletion in the stratosphere). The report 

spurred many research groups to do similar analyses. Satellite observations of middle troposphere temperatures, after several revisions of the data, now compare reasonably with observations from surface stations and radiosondes, although some uncertainties remain. 

Question 8c. The Hockey Stick. Can you comment on whether the observations depicted in the hockey stick curve are, indeed, legitimate? 

Answer. Observations of global mean surface temperature of the past 1000 years 

do show a rapid increase in the last 100 years, with particularly significant warming in the last 30 years. This result has been demonstrated by many different 

groups of scientists using different assumptions and methodologies (see Figure 3). 

Question 9. Some say that global warming might be a positive development? Will 

agricultural crop productivity improve due to the greater amount of CO2 in the atmosphere, and can we expect the Arctic and Antarctic regions to become more habitable? 

Answer. There will be winners and losers from the impacts of climate change, 

even within a single region, but globally the losses are expected to outweigh the 

benefits. Some impacts include:

• Some regions will have increased agricultural productivity due to longer growing seasons, fertilization by higher levels of atmospheric CO2, or changing precipitation patterns, and there may be an overall increase in timber productivity. 

However, other areas, particularly arid and semi-arid regions, will have decreased agricultural productivity due to likely decrease in available soil moisture. 

• Temperate and arctic regions will have decreased energy demands for wintertime heating, although this brings the negative impact of increased energy demands for summer-time cooling. 

• Melting of sea-ice in the Arctic could open up new shipping lanes and 

ecotourism opportunities. 

• Melting of the permafrost in the Arctic will compromise infrastructure (e.g., 

roads and buildings) built on those lands. 

141

• There will likely be shifts in plant and animal habitats, both terrestrial and oceanic, in the Arctic. This could benefit some aspects of life in the Arctic, but indigenous populations who have traditional lifestyles will likely have difficulty 

adapting quickly to the changes. • The changes in Antarctica are anticipated to take place more slowly, so it is difficult to say whether the continent will become more habitable anytime soon.

Question 10. It is my understanding that the assessments of the progression of 

global warming through the next century and its impacts on changing the Earth’s 

climate are largely based on computer modeling. It goes without saying that the 

planet’s atmospheric, hydrologic, and meteorological systems are highly complicated. 

What can you say about how climate modeling capabilities have advanced since scientists began evaluating the problem? What is the level confidence that the computer models are providing useful projections of the future climate? 

Answer. Climate system models are an important tool for interpreting observations and assessing hypothetical futures. They are mathematical computer-based expressions of the thermodynamics, fluid motions, chemical reactions, and radiative 

transfer of Earth climate that are as comprehensive as allowed by computational 

feasibility and by scientific understanding of their formulation. Their purpose is to 

calculate the evolving state of the global atmosphere, ocean, land surface, and sea 

ice in response to external forcings of both natural causes (such as solar and volcanic) and human causes (such as emissions and land uses), given geography and 

initial material compositions. Such models have been in use for several decades. 

They are continually improved to increase their comprehensiveness with respect to 

spatial resolution, temporal duration, biogeochemical complexity, and representation 

of important effects of processes that cannot practically be calculated on the global 

scale (such as clouds and turbulent mixing). Formulating, constructing, and using 

such models and analyzing, assessing, and interpreting their answers make climate 

system models large and expensive enterprises. The rapid increase over recent decades in available computational speed and power offers opportunities for more 

elaborate, more realistic models, but requires regular upgrading of the basic computers to avoid obsolescence. Their simulation skill is limited by uncertainties in 

their formulation, the limited size of their calculations, and the difficulty of interpreting their answers that exhibit almost as much complexity as in nature (NRC, 

2001b). Even though some scientists might prefer a simpler way to project future 

climate, these models are currently the best option because they are the only tool 

that can incorporate the relevant information about the climate system. 

The National Academies’ report Improving the Effectiveness of U.S. Climate Modeling (2001b) offers several recommendations for strengthening climate modeling capabilities, some of which have already been adopted in the United States. At the 

time the report was published, U.S. modeling capabilities were lagging behind some 

other countries. The report identified a shortfall in computing facilities and highly 

skilled technical workers devoted to climate modeling. Federal agencies have begun 

to centralize their support for climate modeling efforts at the National Center for 

Atmospheric Research and the Geophysical Fluid Dynamics Laboratory. However, 

the U.S. could still improve the amount of resources it puts toward climate modeling 

as recommended in Planning Climate and Global Change Research (2003). 

Question 11. The 2001 NAS review of climate-change science that you chaired has 

been interpreted by some as reinforcing the view that human-caused climate change 

is a real and urgent problem, while others say it reinforces the view that the uncertainties are so large that no action should be taken until they are reduced. 

a. Which group is right? 

b. If you were rewriting your report today, some four years later, how would it 

be different? 

Answer. NRC (2001a) describes the state of science on climate change and does 

not address policy choices. In the intervening years, new research has addressed 

some of the uncertainties identified in NRC (2001a). In my opinion, if NRC (2001a) 

were written today, it would give greater emphasis to at least four new findings:

• Longer and more compelling temperature record: 

The years 2001-2004 are four of the five hottest since the late 1880s for global 

mean surface temperature (1998 was the hottest). 

• Better Understanding of Surface and Atmospheric Temperature Trends 

Discrepancies among temperature measurements taken by instruments on 

the surface of the Earth, on balloon-borne radiosondes, and on satellite platforms engendered debate about the warming trend. In recent years, corrections 

to each of the data sets (e.g., Sherwood et al., 2005; Mears and Wentz, 2005) 

along with improved understanding of atmospheric dynamics have made it possible to eliminate the differences or else explain them based on the physical unVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00145 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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1This report presents an analysis of a number of Department of Energy energy efficiency and 

fossil fuel combustion technology research programs. 

derstanding of the system. All three data sets now have a significant warming 

trend at the surface. • Ocean Heat Content Changes Consistent with Greenhouse Warming: 

The ocean, which represents the largest reservoir of heat in the climate system, has warmed by about 0.12° F (0.06° C) averaged over the layer extending 

from the surface down to 750 feet, since 1993. Recent studies have shown that 

the observed heat storage in the oceans is consistent with expected impacts of 

a human-enhanced greenhouse effect (Hansen et al., 2005). • Solar Variability too Small to Explain Warming: 

One area of debate has been the extent to which variations in the Sun might 

contribute to recent observed warming trends. The Sun’s total brightness has 

been measured by a series of satellite-based instruments for more than two 

complete 11-year solar cycles. Recent analyses of these measurements argue 

against any detectable long-term trend in the observed brightness to date. Thus, 

it is difficult to conclude that the Sun has been responsible for the warming observed over the past 25 years. 

RESPONSES OF RALPH J. CICERONE TO QUESTIONS FROM SENATOR BUNNING

Question 1. Would you say that the steps America has taken in the recent years 

to improve energy efficiency and produce lower carbon emissions from power generation are the right first steps in addressing climate change? Within that construct, 

given the current U.S. electricity supply that is more than 50% derived from coal, 

is encouraging clean coal technology, IGCC and carbon sequestration the most important immediate policy action we can take? 

Answer. Over the last several years, there have been dramatic improvements in 

energy efficiency for most electricity using technologies. For example, according to 

the National Academies’ study, Energy Research at DOE: Was It Worth It?, the 

sales-weighted average electricity use by refrigerators sold in the United States 

dropped from about 1365 kWh/year in 1979 to about 600 kWh/year in 2001.1 The 

record for other electric appliances and air conditioning has also been similar. Of 

course, there has also been a significant growth in the number of such appliances 

installed over the same period due primarily to the growth in the number of households. Coupled with increases in the average size of a residence and in the number 

of electricity-using devices per household, there has been continued growth in the 

demand for electricity over the same period. According to the Energy Information 

Administration total electricity use in the residential sector has increased from 683 

billion kWh in 1979 to 1203 billion kWh in 2001. Similar behavior has been observed in the commercial sector where electricity use has grown from 473 billion 

kWh in 1979 to 1080 billion kWh in 2001. The rates of growth in each of these sectors, however, have been substantially less than the period prior to 1979. Although 

there are many reasons for this change, it is likely that increasing energy efficiency 

played a significant role. Furthermore, the study mentioned above along with other, 

ongoing Academy work suggest that there are a number of research opportunities 

for increasing energy efficiency for a broad range of technologies. Nevertheless, 

while past and projected energy efficiency can contribute to at least a slowing of carbon emissions from electricity generation, by itself, it is not likely to stop the growth 

in such emissions. A 1999 report by the Congressional Research Service, Global Climate Change: Carbon Emissions and End-use Energy Demand (RL30036) discusses 

this issue in more detail. 

Research on sequestration of carbon dioxide from the combustion of coal for electric power production could be a very important step for halting the growth in carbon emissions. Clean coal technology and IGCC were initially developed to minimize 

emissions of air pollutants, such as sulfur dioxide. These technologies can contribute 

to carbon emission reductions only to the extent that they increase the efficiency 

of coal combustion and, possibly, make it easier to integrate carbon dioxide sequestration technology. The latter has significant potential for reducing carbon emissions, but its success is still uncertain. Commercial, large-scale carbon sequestration 

is many years away, at best, and research to reach this goal is important (Socolow, 

2005). A National Academies’ workshop report, Novel Approaches to Carbon Management: Separation, Capture, Sequestration, and Conversion to Useful Products, 

presented a discussion of a number of new research areas to attack this problem. 

Until commercial sequestration technologies are available, however, carbon emission 

reductions can probably best be achieved by encouraging the construction of naturalgas fired generation plants instead of coal. The domestic supply of natural gas apVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00146 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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pears to be limited, and production increases may not be possible much longer. 

Therefore to continue this path towards constraining carbon emissions, increasing 

the importation of natural gas, generally in the form of liquefied natural gas (LNG), 

probably is essential. 

In formulating a national strategy for minimizing CO2 emissions from energy production and use, we should consider a range of technology options, from improving 

energy efficiency to carbon sequestration to nuclear energy. It is important to clearly 

and carefully develop reasonable expectations of potential emissions reductions associated with the full suite of technology options. 

Question 2. While you have presented what appears to be a united scientific front 

in the form of the statement from the academies of science from 11 countries, I am 

concerned by some of the news since the release of that statement. The Russian 

Academy of Sciences says it was misrepresented and that Russian scientists actually believe that the Kyoto Protocol was scientifically ungrounded. I am also aware 

that there was a significant misrepresentation on the science between our academy 

and the British representative. Given this background, wouldn’t you say there are 

still some pretty fundamental disagreements about the science of climate change 

among scientists around the world? 

Answer. No, disagreements about the underlying science are actually relatively 

minor. The statement agreed to by the science academies of the G8 nations, China, 

India, and Brazil makes this quite clear. The full statement can be viewed at

http://www.nationalacademies.org/morenews/20050607.html. Note also that the 

statement does not address the relative merits of the Kyoto Protocol. Disagreements 

remain between governments in terms of determining an appropriate policy response. 

Question 3. In this international academies statement, you find that an ‘‘immediate response that will, at a reasonable cost, prevent dangerous anthropogenic interference with the climate system,’’ but continue to say in the following paragraph, 

‘‘minimizing the amount of this carbon dioxide reaching the atmosphere presents a 

huge challenge.’’ Could you please elaborate, since any response can’t both be a ‘‘reasonable cost’’ and a ‘‘huge challenge’’ proposition, how you resolve the two? 

Answer. The question has taken out of context two phrases from the statement 

produced by the science academies of the G8 nations, Brazil, China and India. The 

two paragraphs in full are as follows:

‘‘Action taken now to reduce significantly the build-up of greenhouse gases in 

the atmosphere will lessen the magnitude and rate of climate change. As the 

United Nations Framework Convention on Climate Change (UNFCCC) 

recognises, a lack of full scientific certainty about some aspects of climate 

change is not a reason for delaying an immediate response that will, at a reasonable cost, prevent dangerous anthropogenic interference with the climate 

system. 

As nations and economies develop over the next 25 years, world primary energy demand is estimated to increase by almost 60%. Fossil fuels, which are responsible for the majority of carbon dioxide emissions produced by human activities, provide valuable resources for many nations and are projected to provide 85% of this demand (IEA 2004). Minimising the amount of this carbon dioxide reaching the atmosphere presents a huge challenge. There are many potentially cost-effective technological options that could contribute to stabilising 

greenhouse gas concentrations. These are at various stages of research and development. However barriers to their broad deployment still need to be overcome.’’

In the first paragraph above, the goal of preventing dangerous anthropogenic interference with the climate system is identified and the second paragraph recognizes 

that this is a challenging goal, for which potential technological options are becoming available, but not yet widely deployed. Indeed, the statement of the eleven national science academies recommends several actions to work towards meeting the 

goal:

• ‘‘Identify cost-effective steps that can be taken now to contribute to substantial 

and long-term reduction in net global greenhouse gas emissions. Recognise that 

delayed action will increase the risk of adverse environmental effects and will 

likely incur a greater cost. 

• Work with developing nations to build a scientific and technological capacity 

best suited to their circumstances, enabling them to develop innovative solutions to mitigate and adapt to the adverse effects of climate change, while explicitly recognising their legitimate development rights. 

• Show leadership in developing and deploying clean energy technologies and approaches to energy efficiency, and share this knowledge with all other nations.’’

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Question 4. Several scientists have cited events like the high temperatures in Europe in the summer of 2003 and increased storminess in the 1980s and 1990s as 

evidence of climate change. Don’t global ecosystems go through natural periods similar to these as well? 

Answer. Yes, climate variability is known to have occurred throughout Earth’s 

history, presumably due to natural causes. Scientists have hypothesized that 

human-caused global warming will lead to more frequent and more severe extreme 

events, including heat waves, severe storms, and hurricanes. A recent climate modeling study found that European heat waves in the latter half of the 21st century 

may be more intense, more frequent, and longer lasting than those of the late 20th 

century (Meehl and Tebaldi, 2004). However, it is not possible to determine definitively whether events such as the 2003 European heat wave are due to human or 

natural causes. 

Question 5. There are a number of astrophysicists and other scientists who believe 

that sunspots are a major contributor to changing temperatures. A recent survey 

showed at least 100 such studies are underway. Why don’t scientists put as much 

emphasis on this possibility or other aspects of natural climate variability as they 

do on emissions from human activity? 

Answer. Actually, scientists have conducted significant research on natural climate variability, including how solar variability, volcanoes, the biosphere, weathering of rocks, and other natural processes can affect climate. Research on climate 

variability also addresses multiple modes of natural variability in the climate system, such as the El Nin ̃ o Southern Oscillation (ENSO), the North Atlantic Oscillation (NAO), and the Pacific Decadal Oscillation (PDO), and the extent to which 

these longer term (multi-year to multi-decadal) variations might explain recent 

trends. So far, none of these processes have been able to explain the increases in 

global mean temperature observed since the late 1970s. 

The extent to which variations in the Sun might contribute to recent observed 

warming trends is an area of active research. The Sun’s brightness—its total irradiance—has been measured continuously by a series of satellite-based instruments for 

more than two complete 11-year solar cycles. These multiple solar irradiance 

datasets have been combined into a composite time series of daily total solar irradiance from 1979 to the present. Different assumptions about radiometer performance 

lead to different reconstructions for the past two decades. Recent analyses of these 

measurements, taking into account instrument calibration offsets and drifts, argue 

against any detectable long-term trend in the observed irradiance to date. Likewise, 

models of total solar irradiance variability that account for the influences of solar 

activity features—dark sunspots and bright faculae—do not predict a secular change 

in the past two decades. Thus, it is difficult to conclude from either measurements 

or models that the Sun has been responsible for the warming observed over the past 

25 years, although this hypothesis was more plausible before the availability of 

more recent evidence. 

Knowledge of solar irradiance variations prior to the commencement of continuous 

space-based irradiance observations in 1979 is rudimentary. Models of sunspot and 

facular influences developed from the contemporary database have been used to extrapolate daily variations during the 11-year cycle back to about 1950 using contemporary sunspot and facular proxies, and with less certainty annually to 1610. Circumstantial evidence from cosmogenic isotope proxies of solar activity (14C and 10Be) 

and plausible variations in Sun-like stars motivated an assumption of long-term secular irradiance trends, but recent work questions the evidence from both (Lean et 

al., 2002). Very recent studies of the long term evolution and transport of activity 

features using solar models suggest that secular solar irradiance variations may be 

limited in amplitude to about half the amplitude of the 11-year cycle. 

Question 6. Much of the discussion about climate science being settled is based 

on the summary chapter of the Intergovernmental Panel on Climate Change of the 

United Nations. The chapter made specific predictions about the pace of rising temperatures and the relative importance of human activities to climate change. And 

yet, the body of the report is much more ambiguous and inconclusive about the current state of the science. Is anything being done to ensure that the summary of the 

next IPCC report is more reflective of the overall analysis by the scientists? 

Answer. Certainly some nuance will be lost when summarizing hundreds of pages 

of detailed text in a 59-page Technical Summary or a 17-page Summary for Policymakers, as was the case for the Working Group I portion of the IPCC Third Assessment Report (IPCC, 2001a). Yet, it is not clear that the summaries represented the 

state of science differently than the full text. The 2001 NRC report Climate Change 

Science concluded the following:

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‘‘The committee finds that the full IPCC Working Group I (WGI) report is an 

admirable summary of research activities in climate science, and the full report 

is adequately summarized in the Technical Summary. The full WGI report and 

its Technical Summary are not specifically directed at policy. The Summary for 

Policymakers reflects less emphasis on communicating the basis for uncertainty 

and a stronger emphasis on areas of major concern associated with human induced climate change. This change in emphasis appears to be the result of a 

summary process in which scientists work with policy makers on the document. 

Written responses from U.S. coordinating and lead scientific authors to the 

committee indicate, however, that (a) no changes were made without the consent of the convening lead authors (this group represents a fraction of the lead 

and contributing authors) and (b) most changes that did occur lacked significant 

impact. 

It is critical that the IPCC process remain truly representative of the scientific community. The committee’s concerns focus primarily on whether the 

process is likely to become less representative in the future because of the growing voluntary time commitment required to participate as a lead or coordinating 

author and the potential that the scientific process will be viewed as being too 

heavily influenced by governments which have specific postures with regard to 

treaties, emission controls, and other policy instruments. The United States 

should promote actions that improve the IPCC process while also ensuring that 

its strengths are maintained.’’ (NRC, 2001a)

Another IPCC assessment is underway now, with the reports due to be released 

in 2007. It is our understanding that similar measures will be taken to ensure that 

the summaries accurately reflect the body of the report. For this Fourth Assessment 

Report, Working Group I is co-chaired by Susan Solomon, a highly respected scientist employed by the U.S. National Oceanic and Atmospheric Administration 

(NOAA). 

Question 7. The natural ‘‘greenhouse effect’’ has been known for nearly two hundred years and is essential to the provision of our current climate. There is significant research in the literature today that indicates humans, since the beginning of 

their existence, have caused an increase in the greenhouse effect. Some argue that 

the development of agriculture 6,000 to 8,000 years ago has helped to forestall the 

next ice age. The development of cities, thinning of forests, population growth, and 

most recently the burning of fossil fuels, have all had an impact on climate change. 

Our ecosystems have constantly adapted to change, as we as humans have adapted 

to our ecosystems as well. Is it possible that the increased presence of CO2 caused 

by the 8,000 years of modern human existence may be something our ecosystems 

will continue, as they previously have, to naturally adapt to? 

Answer. Yes, many ecosystems and human systems will likely be able to adapt 

to some of the changes associated with global warming. But, CO2 and other greenhouse gases have increased much more rapidly in the past century than at any 

other time for which we have clear documentation and the levels of these gases are 

higher than at anytime in the last 420,000 years (Petit et al., 1999). Thus, greenhouse warming is happening more rapidly than ecosystems are accustomed to. 

It is not clear how well natural systems will be able to adapt to this more rapid 

and significant change. It is likely that there will be major disruptions to some ecosystems and that terrestrial plant and animal species will be unable to migrate 

quickly enough to accommodate regional climatic changes. Without intervention, it 

is likely that more species will become endangered in the coming decades due to climatic changes in habitat combined with human-caused fragmentation of habitats 

and restriction of migration routes. Habitats of marine species are expected to shift 

poleward, with an expansion in habitat for warm-water species and a decrease in 

habitat for cold-water species. (IPCC, 2001b) 

Question 8. Dr. Cicerone, you said that ‘‘Observations and data are the foundation 

of climate change science.’’ Yet observational data is available for at best the past 

140 years. And reconstructive climate data for the last 2000 years offers widely divergent conclusions as to timing of trends, peaks and troughs. Climate change is 

a phenomenon most apparent over significantly larger time periods. While the panel 

before us presented temperature and CO2 level reconstruction that paints the 20th 

century as one-time anomaly, could you summarize the research that indicates contrary positions? Isn’t it true that at previous times in the earth’s history CO2 emissions have been exponentially higher than current levels? 

Answer. Actually, observations of the last 2000 years do not offer widely divergent 

conclusions as to the timing of trends, peaks, and troughs. In fact, all the estimates 

of global mean observed surface temperature of the past 1000 years show a rapid 

increase in the last 100 years, with particularly significant warming in the last 30 

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* Retained in committee files. 

years reaching maximum temperatures in the late 1990s and early 21st century. 

This result has been demonstrated by many different groups of scientists using different assumptions and methodologies (see Figure 1).* It is consistent with direct 

measurements of the greenhouse gases CO2 and CH4 extracted from ice cores. 

Global mean temperatures over geological timescales are hypothesized to have 

been much warmer (and much colder) at times. Based on models and inferences 

about atmospheric composition from geological data, it is thought that the early 

Earth (i.e., billions of years ago) was warmed by a high concentration of greenhouse 

gases, probably mainly CO2, perhaps in the range of a few hundred to 1000 times 

present atmospheric levels (Kump et al., 2000). To explain such high levels of atmospheric CO2, most attention has focused on the dominant process that draws 

down atmospheric CO2 relative to production on geological timescales: the chemical 

weathering of continental silicate rocks. In a planet with much less exposed land 

mass, this removal process for CO2 would be much slower, allowing CO2 to build 

up in the atmosphere. It should be emphasized, however, that this hypothesis is 

based largely on models and inference rather than conclusive proxy evidence. Also, 

the changes associated with global warming are happening at a much more rapid 

pace than those that may have happened on geological timescales. 

Geological evidence also suggests that atmospheric CO2 changed dramatically on 

timescales of a few to tens of millions of years during much of the Phanerozoic eon 

(from about 540 million years ago until 20 million years ago). The record suggests 

that for at least two-thirds of the last 400 million years, levels of atmospheric CO2

were 5-10 times higher than at present. It appears that these oscillations in atmospheric CO2 were linked to recurring changes from greenhouse to icehouse climate 

states (Berner and Kothavala, 2001; Royer et al., 2004). 

Question 9. The panel touched on some energy alternatives such as biomass, natural gas, and nuclear power, yet there was little mention of hydrogen power. From 

a scientific viewpoint, where do you think we are on being able to really utilize hydrogen power? What is the potential of hydrogen power? 

Answer. Hydrogen, like electricity, is an energy carrier, not a primary fuel. It 

must be made from other energy sources. It has the potential for reducing carbon 

emissions if it is generated from non-fossil energy (nuclear or renewables) or if the 

carbon from fossil fuel sources is sequestered. The National Academies has recently 

issued two major reports on the subject of hydrogen covering the potential of future 

technologies for its production, as well as its use in transportation and stationary 

applications: The Hydrogen Economy—Opportunities, Costs, Barriers, and R&D 

Needs (2004), and Review of the Research Program of the Freedom CAR and Fuel 

Partnership (2005). Transforming the current petroleum-based transportation system, for example, to a clean, hydrogen-fueled system is extremely challenging requiring a fundamental transformation of automotive technologies and the supporting fuel infrastructure. Even if all the technical challenges are met, 

transitioning from the current fuel infrastructure based on gasoline and diesel fuel 

to one based on hydrogen derived from a variety of sources (e.g., coal, natural gas, 

solar, wind, biological conversion, nuclear) will be a formidable social and economic 

challenge. Research and development in support of such a transformation is justified 

by the potentially enormous beneficial impact to the nation. 

Much progress has been made in many hydrogen technologies, such as fuel cells. 

Nevertheless, many technical barriers exist and need to be overcome, and fundamental invention is probably needed to achieve performance and cost levels that will 

lead to cost competitive hydrogen and commercially acceptable vehicles. For example, fuel cells face performance, durability, efficiency and cost issues, and hydrogen 

storage for onboard vehicles faces difficult size, weight and cost barriers. Even assuming that the technical and cost targets for commercial readiness could be met 

in the 2015 to 2020 time frame, it would take many decades for the turnover of the 

vehicle fleet in order to have a significant impact on carbon emissions from the 

transportation sector. This implies that the conventional internal combustion engine 

will be the automotive power plant that consumes most of the fuel in the vehicle 

fleet for several decades to come and improving technology to reduce fuel consumption and emissions from internal combustion engines is, therefore, critically important as well. 

Question 10. The panel established very clearly that we should adopt policies that 

decrease carbon emissions regardless of any other carbon emissions policies we pursue. We are currently or will shortly be providing expanded incentives for clean coal, 

nuclear energy and renewable fuels. Do you feel this is money well spent? What 

technologies do you feel the government should be more involved in developing? 

147

Answer. Nuclear and renewable energy technologies release very little carbon. As 

noted above, clean coal technology and IGCC coupled with full sequestration can 

also result in little or not carbon emissions. All of these technologies, however, have 

drawbacks. The economic competitiveness of nuclear energy is still questionable 

compared to current fossil technologies under existing regulatory conditions, and 

issues of nuclear waste and public acceptance still remain. Only a few renewable 

energy technologies are economic at this time, and then only at particularly favorable sites. Also, as noted, the successful development of carbon sequestration is uncertain. Nevertheless, these are our options for carbon-free fuels. 

In the transportation sector, it will also be important to understand the competition that will arise between electricity-based, liquid-fuel-based (e.g., cellulosic ethanol), and hydrogen-based transportation technologies. This is particularly important as clean alternative combustion engines and hybrid vehicles, fuel cells, and batteries evolve. Understanding which pathway, or combination of pathways, will provide the best opportunities for reducing CO2 emissions and improving energy security will require a balanced research and development portfolio and extensive systems analysis. 

In all of these cases, continued research and development is important. There remains, however, the question of how best to pursue the goal of reducing carbon 

emissions. A systematic, comprehensive comparison of the options described in the 

above three questions has not been done. Such an analysis would have to account 

for the complex array of economic, technical, environmental, regulatory, and public 

acceptance issues that affect each of the options. With the results of this assessment 

in hand, policy choices that provide effective incentives for the most promising carbon management options are more probable. 

RESPONSES OF RALPH J. CICERONE TO QUESTIONS FROM SENATOR TALENT

Question 1. The Academies letter says that it is ‘‘likely’’ that man is the cause 

of global warming—what exactly do we know, and what are we inferring from the 

data we have? How well to the models of today replicate actual observed climate 

patterns of recent times? What margin of error do you attach to the best models 

we have today? 

Answer. It is likely that most of the global mean surface temperature increase 

since the late 1970s is due to human activities. This conclusion is consistent with 

that reached by Intergovernmental Panel on Climate Change (IPCC) in their 2001 

assessment of the scientific literature and the 2001 report of the NRC Climate 

Change Science: An Analysis of Some Key Questions. 

This conclusion is generally based on studies that compare the observed climate 

record from 1860 to today with global mean temperature simulated in three computational climate model scenarios:

1) Only natural variability (due to solar and volcanic variability) 

2) Only anthropogenic variability (due to greenhouse gases and aerosols) 

3) Both natural and anthropogenic variability

In these studies, the models run with only natural variability are unable to reproduce the warming observed since the late 1970s, typically showing no trend over 

this time period (e.g., Stott et al., 2000; Meehl et al., 2004). Thus, we conclude that 

human-caused climate forcings have disrupted Earth’s energy balance, causing an 

increase in global mean surface temperatures (NRC, 2005). 

Improved understanding of the natural variability of the climate system supports 

the conclusion that human activities are mostly responsible for global temperature 

increases of the past three decades. In particular, new studies of solar variability 

show that there has been little if any trend in the Sun’s brightness over the past 

25 years, ruling out solar variability as a major driver of observed warming (see Response to #2 for more details). 

Because of the still uncertain level of natural variability inherent in the climate 

record and the uncertainties in the time histories of the various forcing agents, a 

causal linkage between the buildup of greenhouse gases in the atmosphere and the 

observed climate changes during the 20th century cannot be unequivocally established. The fact that the magnitude of the observed warming is large in comparison 

to natural variability as simulated in climate models is suggestive of such a linkage, 

but it does not constitute incontrovertible proof of one because the model simulations could be deficient in natural variability on the decadal to century time scale. 

Question 2. There are a number of astrophysicists and other scientists who believe 

that sunspots are a major contributor to changing temperatures. A recent survey 

showed at least 100 such studies are underway. Why don’t scientists put as much 

148

emphasis on this possibility or other aspects of natural climate variability as they 

do on emissions from human activity? 

Answer. Actually, scientists have conducted significant research on natural climate variability, including how solar variability, volcanoes, the biosphere, weathering of rocks, and other natural processes can affect climate. Research on climate 

variability also addresses multiple modes of natural variability in the climate system, such as the El Nin ̃ o Southern Oscillation (ENSO), the North Atlantic Oscillation (NAO), and the Pacific Decadal Oscillation (PDO), and the extent to which 

these longer term (multi-year to multi-decadal) variations might explain recent 

trends. So far, none of these processes have been able to explain the increases in 

global mean temperature observed since the late 1970s. 

The extent to which variations in the Sun might contribute to recent observed 

warming trends is an area of active research. The Sun’s brightness—its total irradiance—has been measured continuously by a series of satellite-based instruments for 

more than two complete 11-year solar cycles. These multiple solar irradiance 

datasets have been combined into a composite time series of daily total solar irradiance from 1979 to the present. Different assumptions about radiometer performance 

lead to different reconstructions for the past two decades. Recent analyses of these 

measurements, taking into account instrument calibration offsets and drifts, argue 

against any detectable long-term trend in the observed irradiance to date. Likewise, 

models of total solar irradiance variability that account for the influences of solar 

activity features—dark sunspots and bright faculae—do not predict a secular change 

in the past two decades. Thus, it is difficult to conclude from either measurements 

or models that the Sun has been responsible for the warming observed over the past 

25 years, although this hypothesis was more plausible before the availability of 

more recent evidence. 

Knowledge of solar irradiance variations prior to the commencement of continuous 

space-based irradiance observations in 1979 is rudimentary. Models of sunspot and 

facular influences developed from the contemporary database have been used to extrapolate daily variations during the 11-year cycle back to about 1950 using contemporary sunspot and facular proxies, and with less certainty annually to 1610. Circumstantial evidence from cosmogenic isotope proxies of solar activity (14C and 10Be) 

and plausible variations in Sun-like stars motivated an assumption of long-term secular irradiance trends, but recent work questions the evidence from both (Lean et 

al., 2002). Very recent studies of the long term evolution and transport of activity 

features using solar models suggest that secular solar irradiance variations may be 

limited in amplitude to about half the amplitude of the 11-year cycle. 

Question 3. Is it true that the Canadian Climate Center study and the U.K. Hadley Center studies used by the Clinton Administration to justify Kyoto were the two 

that predicted the most extreme results? Is it also true that Dr. Pat Michaels and 

Tom Karl of NOAA independently confirmed that these models could not reproduce 

past U.S. temperature trends over any averaging period (e.g., 5, 10, or 25 year periods)? Didn’t the Canadian model over-predict warming by 300%? 

Answer. To my knowledge, the Clinton Administration never used any specific 

models to ‘‘justify Kyoto.’’ The U.S. National Assessment of Potential Climate 

Change Impacts (NAST, 2000) did use climate scenarios from both the Canadian 

Climate Center (CCC) and the U.K. Hadley Center in its analyses, along with several other models and historical data. The National Assessment, which fulfills the 

requirements of the U.S. Global Change Research Act of 1990, evaluated the potential risk to the United States from climate impacts if greenhouse gas emissions continued on a business-as-usual trajectory. It did not consider any Kyoto-based analyses. The two models were selected by the National Assessment Synthesis Team 

(NAST), an independent, non-governmental committee for several reasons:

1) They were published and part of the international debate leading to the 

IPCC reports, also completed in 2001. 

2) The model computations covered the period from 1895 to 2100, allowing the 

National Assessment to (a) compare model results and historical observations 

to judge the veracity of the simulations and (b) examine future climate conditions projected by the models. 

3) They preserved model results on a daily basis (rather than monthly means, 

for example), allowing the National Assessment to include ecosystem impact 

analysis. 

4) They provided access to all the available model results. 

5) They bracketed the range of model simulations or, in other words, they 

were far from the most extreme results. The CCC model was one of the warmer 

models in the IPCC family, whereas the Hadley Center model was at the lower 

149

* Retained in committee files. 

end of the spectrum, but somewhat closer to the middle (see NAST, 2001, p. 

31-40).

These two models were not the only ones used in the National Assessment. Some 

participants also used the National Center for Atmospheric Research (NCAR) Climate System Model, however it was not ready until part way through the assessment so not every group included it. At the time, U.S. modeling capabilities were 

lagging behind some other countries, in part because of a shortfall in computing facilities and highly skilled technical workers devoted to climate modeling (NRC, 

2001b). In addition to global models, some participants in the National Assessment 

also looked at historical analogues or regional model simulations. 

In regard to the questions about the accuracy of the models, it is important to 

note that all global climate models have some flaws. All the models used in the National Assessment were compared to observations to judge their ability to simulate 

the last 100 years. All the available models suggest a warming range of 0.4 to 0.8°

C over the 20th century, which is the same range as the observations. The Hadley 

model predicts 0.55° C and the Canadian 0.7° C, well within the observed range. 

The Canadian model did not over-predict 20th century global mean temperature 

trends by 300%. Most models of this generation captured the ups and downs of the 

observed record of the last 100 years when they included the impacts of solar variability, greenhouse gases, and aerosols. However, they were not designed in a way 

to perfectly reproduce the year-to-year variation for a specific region over any period 

of years in the 20th century. Thus, conclusions in the National Assessment about 

interannual variation were not based on the global model results. 

Question 4. To what degree can we attribute warming to controllable GHG emissions, i.e., what portion of the observed warming is due to human emissions? 

Answer. It is likely that most of the global mean surface temperature increase 

since the late 1970s is due to human activities. This conclusion is consistent with 

that reached by Intergovernmental Panel on Climate Change (IPCC) in their 2001 

assessment of the scientific literature and the 2001 report of the NRC Climate 

Change Science: An Analysis of Some Key Questions. 

This conclusion is generally based on studies that compare the observed climate 

record from 1860 to today with global mean temperature simulated in three computational climate model scenarios:

1) Only natural variability (due to solar and volcanic variability) 

2) Only anthropogenic variability (due to greenhouse gases and aerosols) 

3) Both natural and anthropogenic variability

In these studies, the models run with only natural variability are unable to reproduce the warming observed since the late 1970s, typically showing no trend over 

this time period (e.g., Stott et al., 2000; Meehl et al., 2004). Thus, we conclude that 

human-caused climate forcings have disrupted Earth’s energy balance, causing an 

increase in global mean surface temperatures (NRC, 2005). 

Question 5. Assuming the technology was available today, what would be the necessary GHG emissions cuts in the U.S.A to stop the warming and level out global 

temperatures? Does this assume no increases in emissions by developing nations? 

Answer. Carbon dioxide can remain in the atmosphere for many decades and 

major parts of the climate system respond slowly to changes in greenhouse gas concentrations. Although carbon dioxide is the most significant greenhouse gas perturbed by humans, other anthropogenic greenhouse gases also have an important 

impact on climate. These include (1) methane, for which concentrations have increased by about a factor of 2.5 since preindustrial times, but have stopped increasing more recently for unknown reasons; (2) halocarbons such as chlorofluorocarbons, 

whose emissions were controlled because they contribute to ozone depletion in the 

stratosphere; and (3) nitrous oxide, which continues to rise. 

Even if greenhouse gas levels were stabilized instantly at today’s levels, the climate would still continue to change as it adapts to the increased emissions of recent 

decades, as illustrated in Figure 1. For current models with a midrange climate sensitivity and average assumptions about the greenhouse effects of atmospheric 

aerosols, Wigley (2005) estimates that global mean surface temperatures will increase by about 0.4° C over the next 400 years, with most of the warming occurring 

within the first 100 years (see the center red line in Figure 1).* Thus, even with 

no greenhouse gas emissions from this point forward, we would be experiencing the 

impacts of climate change throughout the 21st century and beyond. 

Because instantly stopping all greenhouse gas emissions is unrealistic, scientists 

have considered what steps would be necessary to stabilize atmospheric CO2 levels 

150

at several targets ranging from 450 ppm to 1000 ppm (compared to today’s levels 

of 380 ppm and pre-industrial concentrations of 280 ppm). Depending on the target, 

a range of emissions cuts are required by developed and developing countries. For 

example, Wigley (1997) found that to achieve CO2 stabilization at 550 ppm, developed countries would need to begin reducing emissions 1% a year by 2010 and developing countries would need to do so by 2030. Note that stabilizing CO2 concentrations at 550 ppm is estimated to lead to a global mean temperature increase of 

about 2.5° C over 1990 levels in 2150 (IPCC, 2001). 

Question 6. The statement from the academies of science from 11 countries has 

turned out to be quite controversial. The Russian Academy of Sciences says it was 

misrepresented in the statement and that Russian scientists actually believe that 

the Kyoto Protocol was scientifically ungrounded. Also, the president of the American Academy has complained that his British counterpart misrepresented the U.S. 

view of the science and that there might be an end to future collaboration between 

U.S. and British scientists. Aren’t there still some pretty fundamental disagreements about the science of climate change among scientists around the world? 

Answer. No, disagreements about the underlying science are actually relatively 

minor. The statement agreed to by the science academies of the G8 nations, China, 

India, and Brazil makes this quite clear. The full statement can be viewed at

http://www.nationalacademies.org/morenews/20050607.html. Note also that the 

statement does not address the relative merits of the Kyoto Protocol. Disagreements 

remain between governments in terms of determining an appropriate policy response. 

Question 7. The 4th paragraph of the joint science academies’ statement talks 

about undertaking an ‘‘immediate response that will, at a reasonable cost, PREVENT dangerous anthropogenic interference with the climate system.’’ But the 5th 

paragraph says, ‘‘minimizing the amount of this carbon dioxide reaching the atmosphere presents a huge challenge.’’ Since it can’t be both, would you describe the 

measure you would endorse as a ‘‘reasonable cost’’ proposition or a ‘‘huge challenge’’? 

Answer. The question has taken out of context two phrases from the statement 

produced by the science academies of the G8 nations, Brazil, China and India. The 

two paragraphs in full are as follows:

‘‘Action taken now to reduce significantly the build-up of greenhouse gases in 

the atmosphere will lessen the magnitude and rate of climate change. As the 

United Nations Framework Convention on Climate Change (UNFCCC) 

recognises, a lack of full scientific certainty about some aspects of climate 

change is not a reason for delaying an immediate response that will, at a reasonable cost, prevent dangerous anthropogenic interference with the climate 

system. 

As nations and economies develop over the next 25 years, world primary energy demand is estimated to increase by almost 60%. Fossil fuels, which are responsible for the majority of carbon dioxide emissions produced by human activities, provide valuable resources for many nations and are projected to provide 85% of this demand (IEA 2004)3. Minimising the amount of this carbon 

dioxide reaching the atmosphere presents a huge challenge. There are many potentially cost-effective technological options that could contribute to stabilising 

greenhouse gas concentrations. These are at various stages of research and development. However barriers to their broad deployment still need to be overcome.’’

In the first paragraph above, the goal of preventing dangerous anthropogenic interference with the climate system is identified and the second paragraph recognizes 

that this is a challenging goal, for which potential technological options are becoming available, but not yet widely deployed. Indeed, the statement of the eleven national science academies recommends several actions to work towards meeting the 

goal:

• ‘‘Identify cost-effective steps that can be taken now to contribute to substantial 

and long-term reduction in net global greenhouse gas emissions. Recognise that 

delayed action will increase the risk of adverse environmental effects and will 

likely incur a greater cost. 

• Work with developing nations to build a scientific and technological capacity 

best suited to their circumstances, enabling them to develop innovative solutions to mitigate and adapt to the adverse effects of climate change, while explicitly recognising their legitimate development rights. 

• Show leadership in developing and deploying clean energy technologies and approaches to energy efficiency, and share this knowledge with all other nations.’’

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Question 8. If all the countries that have signed Kyoto stay within compliance of 

Kyoto, how much of a reduction in global warming would this result in? 

Answer. Estimates for warming between 1990 and 2100 range from 1.4 to 5.8° C 

(IPCC, 2001). In the analysis of Reilly et al. (1999), if all nations complied with the 

Kyoto Protocol, global mean surface temperatures would be about 0.5° C less than 

if no intervention is taken. At the treaty’s implementation in February 2005, the 

agreement had been ratified by 141 countries representing about 60% of global 

emissions. Thus, the Kyoto Protocol as currently being implemented, might be expected to reduce future warming by about 0.3° C by 2100. 

Question 9. Can you confirm that suspended water vapor levels, cloud cover percentages and direct solar irradiation changes over time all represent variables in 

these forecasting models that could have significant impacts on the conclusions of 

the results of these models? 

Answer. Yes, water vapor, cloud cover, and solar irradiation are important variables that all climate models incorporate. 

Question 10. In looking at pre-industrial global temperature patterns, would you 

agree that changes in temperatures over time have occurred that had no anthropogenic basis? 

Answer. Yes, pre-industrial temperature showed natural climate variability, likely 

due to solar variability, volcanoes, the biosphere, weathering of rocks, and other natural processes. There are also multiple modes of natural variability in the climate 

system, such as the El Nin ̃ o Southern Oscillation (ENSO), the North Atlantic Oscillation (NAO), and the Pacific Decadal Oscillation (PDO), which cause longer term 

(multi-year to multi-decadal) variations. 

Question 11. Do we know what the ‘‘best’’ global temperature is to sustain life? 

Answer. No, but we do know that human systems have developed in a way to take 

advantage of current climate conditions. We live and have built major infrastructure 

along coastlines, assuming that sea levels will not change significantly. We have developed agricultural lands in locations that current climate conditions favor. We 

have constructed elaborate systems to distribute fresh water that depend on current 

snow pack levels, rainfall amounts, and river flows. These and other major 

infrastructural investments are not easily or quickly shifted. Thus, while humans—

especially those who live in richer and more educated countries—will no doubt be 

able to adapt, it is unlikely that they could do so without exacting economic, health, 

and other tolls. 

Question 12. What is currently being done to curb emissions from parts of the 

world in poverty who are deforesting their environment and burning biomass for all 

means of day-to-day living, and are these emissions continuing to increase in the 

world? 

Answer. I am not familiar with efforts to control biomass burning emissions in 

developing countries. Based on satellite observations of large fires, Duncan et al. 

(2003) found no significant trends in emissions from burning of forests and grasslands over the past two decades. Their analysis did not consider emissions from 

burning biofuel (e.g., wood, agricultural waste) for day-to-day living. Streets et al. 

(2001) analyzed greenhouse gas emissions from China over the 1990s and found a 

slow decline in emissions from the use of biofuel for cooking and heating. 

Question 13. Do you believe it is practical to seek emission controls in parts of 

the world that are struggling in poverty? 

Answer. Whether to seek emission controls in impoverished parts of the world is 

largely a policy decision, for which science and technology can inform only part of 

the answer. Certainly, higher quality fuels and better developed technology for 

using those fuels provide greater energy output and less pollution. So, there are 

compelling reasons for curbing emissions in these countries in addition to addressing global warming. 

Question 14. What is being done to curb emissions in the developing countries like 

China and India? 

Answer. Streets et al. (2001) analyzed greenhouse gas emissions from China over 

the 1990s and found that emissions increased significantly from 1990 until about 

1996, when they began decreasing until 2000. They attribute the decrease to a radical reform of China’s coal and energy industries, as well as the economic downturn 

in China associated with the Asian economic crisis of 1997-1998. At the time, the 

authors predicted that as China’s economy recovered from the economic downturn 

and completed major reforms, rates of greenhouse gas emissions would begin to 

slowly increase. More recently, China has taken several steps to begin controlling 

their greenhouse gas emissions, including:

• In October, 2004 China enacted their first fuel efficiency standards for new passenger cars (see http://www.usatoday.com/money/world/2004-10-08-chinaVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00155 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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fuel-efficiencylx.htm ). The first phase began this summer. The second phase 

begins in 2008 and mandates a 10% improvement. Unlike U.S. standards which 

regulate corporate averages, the Chinese standards set a maximum fuel consumption rate for every vehicle sold, with the rate varying for 32 different car 

and truck weight classes. 

• In January 2005, the National Development and Reform Commission (NDRC) 

published the China Medium and Long Term Energy Conservation Plan which 

targets an average annual reduction of 2.2% in energy intensity to 2010. The 

main thrust of the plan is to give priority to energy conservation over development of new energy sources. 

• In March, 2005 China enacted a renewable energy law requiring an increase 

in consumption of renewable energy from current levels of about 3% to 10% by 

2020. My understanding is that renewable energy in the law includes 

hydroelectricity, wind power, solar energy, geothermal energy and marine energy. (See http://www.renewableenergyaccess.com/assets/download/

ChinalREl Lawl05.doc) 

• China’s Air Conditioner Energy Efficiency Standards have recently been tightened by 10-20%

Emissions from India have increased significantly over the past several decades 

as the country has become more industrialized. Analyses by Shukla et al. (e.g., 

2003) indicate that a portfolio of strategies—including increasing efficiency, upgrading transportation systems, and penetration of renewable and nuclear energy 

sources—will likely be necessary to control emissions as India’s economy and population expand in the coming decades. I am not familiar with specific measures to 

control emissions in India. 

RESPONSES OF RALPH J. CICERONE TO QUESTIONS FROM SENATOR FEINSTEIN

Question 1. Is there any credible scenario for stabilizing greenhouse gas emissions 

that does not involve the United States and other major emitters stopping their 

emissions growth over the next couple of decades and sharply reversing their emissions growth by 2050? 

Answer. Stabilizing CO2 concentrations in the atmosphere requires CO2 emissions 

to drop well below current levels. Although the ocean has the capacity to uptake 

70 to 80% of foreseeable anthropogenic CO2 emissions, this process takes centuries 

due to the slow rate of ocean mixing. It is hard to envision any scenario for stabilizing greenhouse gas emissions and the resultant concentrations of these gases in 

the atmosphere that does not involve significant emissions reductions by major 

emitters. 

Question 2. Would the National Commission on Energy Policy’s proposal stop and 

then reverse U.S. greenhouse gas emissions? 

Answer. My understanding is that the proposal by the National Commission on 

Energy Policy aims to slow, stop, and then reverse growth in the rate of greenhouse 

gas emissions. Under the proposal, total annual emissions would continue to increase until around 2020, then level out, and eventually start to decrease. 

RESPONSES OF SIR JOHN HOUGHTON TO QUESTIONS FROM SENATOR BINGAMAN

Question 1. Over the last several decades, anthropogenic emissions have ‘‘substantially contributed’’ to the increase in average global temperatures. Upon receiving 

a question from one of the Senators, one of the panelists suggested that ‘‘80 percent’’ 

of the warming was due to human activities. Do all the panelists agree? Please provide information as to how this estimate was derived. 

Answer. I was not the panelist that quoted the 80%. It is, however, close to the 

estimate that I have also often quoted quite independently and arrived at as follows. 

In answering the question of how much of the recent warming is due to human activities there are two relevant considerations: (1) estimates of radiative forcing and 

(2) estimates of natural variability. I deal with these in turn. 

ESTIMATES OF RADIATIVE FORCING

It is the radiative forcings that are driving change. For the latest estimates of radiative forcings I refer to the paper by J. Hansen et al., Earth’s Energy Imbalance: 

Confirmation and Implications, in Sciencexpress for 2 May 2005—a paper that provides more detail and updates similar information in Fig 3 in the Summary for Policymakers (SPM) and in chapter 6 of the IPCC 2001 Report, Climate Change 2001: 

the Scientific Basis. 

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‘Natural’ forcings are mainly those due to volcanoes (in Hansen’s paper the blue 

line labelled stratospheric aerosols—because it is dust in the stratosphere that 

causes forcings from volcanoes) and changes in solar irradiance. The estimated solar 

irradiance change of about 0.2 watts per square metre occurred mostly in the first 

half of the 20th century and is believed to be a significant factor in leading to the 

warming during that period. Changes in solar radiation in the second half of the 

century are small as indicated from measurements from satellite instruments since 

the 1970s. 

The other forcings are almost entirely anthropogenic (apart from a small component of black carbon from ‘natural’ forest fires). Note that greenhouse gases provide 

by far the largest positive (warming) forcing and that significant negative (cooling) 

forcing comes from anthropogenic aerosols. This latter is sometimes called global 

dimming as it tends to offset some of the greenhouse gas warming. Note that by 

far the largest contribution to radiative forcing over the last 50 years comes from 

increases in greenhouse gases and that at least 95% of the positive (warming) forcing over this period comes from human activities. Note also that most of the negative forcing is also of human origin and that this will reduce if, as is expected, sulphur dioxide (that leads to reflective tropospheric aerosol formation) pollution controls become more severe during coming decades. 

Fig 1B in the Hansen et al. paper compares model simulations of surface temperature change over the 20th century, that include all the forcings of Fig 1A, with observations of surface temperature change. It should be compared with Fig 4 in the 

SPM of the IPCC 2001 Report. It deals more comprehensively and accurately with 

the various forcings than did the IPCC Report and extends them to the present. It 

shows a remarkable degree of agreement between simulations and observations. 

ESTIMATES OF NATURAL VARIABILITY

Looking at estimates of anthropogenic radiative forcing enables us to establish 

that the observed warming over the last 50 years is entirely consistent with it being 

due almost entirely to human activities. However, it is known that the global average temperature and hence the climate can also change due to unforced variations 

that occur because of variations within the climate system itself. Estimates of such 

natural variability come from long climate model simulations that agree reasonably 

well with such variability found in observational studies (as explained in chapters 

8 and 12 of the IPCC 2001 Report). Such studies show that more than about 20% 

of the rise in global average temperature since 1950 of about 0.45° C is very unlikely (less than 10% probability) to come from natural unforced variability. 

Taking these two considerations together leads to the conclusion that it is very 

likely (greater than 90% probability) that at least 75% of the warming over the last 

50 years in due to human activities. 

Question 2. We received testimony that sought to distinguish between average 

global temperature changes causes primarily by anthropogenic emissions and local/

regional temperature changes caused at times by natural variation. Please explain 

in greater detail. 

Answer. The climate shows natural variability (i.e. unforced variability—see answer to question 1) in all climate characteristics (temperature, precipitation, humidity, wind speed, etc.) and on all time and space scales. The shorter the time scale 

and the smaller the space scale the larger is this variability. That is why it is easier 

to identify trends in climate due to anthropogenic emissions in annual and global 

averages of quantities such as temperature rather than in shorter-term or local climate data. 

Climate regimes are patterns of climate behaviour that have been identified in 

different regions. They represent an important component of the description of climate in different parts of the world. Examples of these regimes are the Pacific 

North Atlantic Anomaly (PNA), the North Atlantic Oscillation (NAO) and the El 

Nin ̃ o-Southern Oscillation (ENSO). The last of these is the best known and the most 

important; El Nin ̃ o events are associated with extreme climate events such as floods 

and droughts in Africa, Australia, America and Asia. There seems no doubt that 

these regimes are influenced by increases in greenhouse gases; understanding the 

detail of these influences is an important topic of current research. 

Question 3. Please explain the meaning of ‘scientific consensus’ and comment on 

the status of the science of climate change in the scientific and academic community. 

Answer. Because discussion and debate are essential to the advancement of 

science, use of the expression ‘scientific consensus’ needs to be explained. In the context of the IPCC reports ‘consensus’ does not mean that agreement has been reached 

on all matters concerning climate change. What the IPCC has done in its reports 

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is to distinguish between what is reasonably well known and understood from those 

areas where there is still much uncertainty and debate. What is often described as 

the IPCC ‘consensus’ (although the IPCC itself has never used that term) concerns 

matters such as the estimates of global average temperature rise (including its 

range of uncertainty), the range of estimates of sea level rise and the descriptions 

of likely dominant impacts in terms of precipitation and extremes—all under stated 

assumptions regarding future anthropogenic emissions. 

The IPCC Reports have been given very strong support by many scientific bodies 

including most recently in a statement issued on the 7 June 2005 by the Academies 

of Science of the leading nations of the world (the G8 countries plus China, India 

and Brazil). 

The science of climate change has grown very substantially over the last twenty 

years—so has the number of scientists working in the field. It has become an increasingly well established and respected academic discipline. Climate data has expanded a great deal and climate models have developed in size (thanks to increased 

computing power) and sophistication. Modeling of regional change is now developing 

rapidly into a useful and effective tool for the analysis and projection of regional 

changes. As the science has advanced, not only have the basic messages regarding 

climate change in the IPCC’s 1990 and 1995 Reports been confirmed but the impacts then projected have proved, in general, to be too conservative. 

Question 4. What is ‘‘abrupt climate change?’’ Can you identify any potential 

thresholds that might be crossed if insufficient action is taken to control CO2 emissions? For example, I have heard that beyond certain temperature increases, large 

ice sheets could collapse, leading to huge increases in sea level. Can you comment 

on this and other potential thresholds? 

Answer. The climate system is complex and highly non-linear in character. ‘Abrupt climate change’ refers to the possibility of unusual and rapid change occurring 

due to thresholds being reached or instabilities occurring. Some examples are:

1) If the average temperature in the vicinity of Greenland rises by more than 

about 3° C (5.5° F)—very likely to occur within the next 50 years—studies indicate that melt down of the Greenland ice sheet is likely to begin (Climate 

Change 2001, the Scientific Basis IPCC 2001 Report, chapter 11). Complete melt 

down, that could take 1000 years or more, would lead to 7m (23 ft.) of global 

sea level rise. 

2) There is a lot of current concern regarding the stability of the West Antarctic Ice Sheet. It could lose mass over the next 1000 years with an associated 

sea level rise of several meters but there is incomplete understanding of some 

of the underlying processes (Climate Change 2001: Synthesis Report, IPCC 

2001, Report Q4). 

3) The long term stability of the ocean’s Conveyor Belt (a circulation in the 

deep ocean coupling the oceans together) is also of concern. It is partially driven 

by the Thermohaline Circulation (THC) whose main source is the sinking of 

cold, dense water with high salinity at high latitudes in the Atlantic ocean. Increased precipitation at these latitudes and increased ice melt reduces the water’s salinity, and hence its density, making it less likely to sink, so weakening 

the THC. All climate models that couple the ocean and atmospheric circulations 

show this weakening of the THC and hence also of the Gulf Stream. It is possible for the THC to be cut off completely—some models with ‘business as usual’ 

growth in CO2 emissions show cut-off occurring within 100-300 years; there is 

also paleoclimatic evidence of it occurring in the past. If cut-off were to occur, 

the effect on the world’s climate, especially in regions surrounding the north Atlantic, could be profound (Climate Change 2001, the Scientific Basis IPCC 2001 

Report, chapters 7 and 9).

Question 5. Can you tell us something about the time horizon for stabilizing climate, given how long carbon dioxide remains in the atmosphere? Do we need to 

begin to control emissions now or can we wait? 

Answer. There are three main time scales concerned with the stabilization of climate.

1) The first is the time response of the oceans to change. If emissions of 

greenhouse gases were to end immediately, the global average temperature 

would continue to rise at a similar rate as now for 30 to 50 years as the ocean’s 

upper layers warm and then much more slowly over centuries as the lower layers of the ocean warm. 

2) The second time scale is concerned with the life time of carbon dioxide in 

the atmosphere that is largely determined by exchange with the ocean. Its life 

time in the atmosphere is complex but is typically of the order of decades (for 

exchange with the ocean’s upper layers) and centuries (for exchange with the 

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deeper ocean). If anthropogenic input of carbon dioxide to the atmosphere were 

to halt, its atmospheric concentration would only decline slowly. 

3) The third time scale of importance is that applying to changes in anthropogenic emissions. Because of inertia in the system of energy infrastructure, 

changes in these emissions will take the order of decades to be realized.

For reasons associated with all these time scales—reducing the build up of further 

commitment to change associated with (1), recognizing the long time scale for emissions reductions to be reflected in the atmospheric carbon dioxide concentration with 

(2) and the time scales associated with energy infrastructure in (3)—there is an urgency to begin seriously to reduce emissions now. 

Question 6. Given that there is still some uncertainty about the details of future 

warming, how should such uncertainty be dealt with in designing policy responses? 

Answer. The need for appropriate policy responses despite scientific uncertainty 

was recognized 13 years ago in 1992 in the Framework Convention on Climate 

Change agreed by all nations at the Earth Summit in Rio de Janeiro, signed by 

President George Bush Senior for the United States and subsequently ratified 

unanimously by the U.S. Senate. In Article 3 it includes an agreement that the Parties to the Convention should ‘‘take precautionary measures to anticipate, prevent or 

minimize the causes of climate change and mitigate its adverse effects. Where there 

are threats of serious or irreversible damage, lack of full scientific certainty should 

not be used as a reason for postponing such measures, taking into account that policies and measures to deal with climate change should be cost-effective so as to ensure 

global benefits at the lowest possible cost.’’

Scientific certainty regarding many aspects of climate change has increased substantially since 1992 so that the need to take action is even stronger that it was 

then. A range of responses can be designed.

1) There are responses addressing energy efficiency e.g. in buildings, appliances, vehicles and in industry. Many of these will require regulation or incentives for them to be achieved on the scale required. Most of them are win-win 

in character, as most will lead to significant—even large—savings in cost or materials as well as in carbon emissions. There are numerous examples, for instance from U.S. industries, showing the value to the U.S. economy of such 

measures. 2) There are responses that also enhance energy security that are also winwin. 

3) There are responses to do with adaptation to climate change, for instance 

to prepare, especially in the more vulnerable areas, for the expected increase 

in the number and intensity of extreme events (e.g. floods, droughts, heat 

waves). There is much evidence to show that more adequate preparation substantially reduces the damaging impacts of such events. 

4) There are responses that would be much more cost-effective to take now 

rather than later, for instance in the design of power infrastructure with a typical life of 30-50 years. To have to replace such infrastructure before the end 

of its useful life would be costly. 

5) There are technologies concerned with carbon-free energy sources (e.g. 

solar, biomass, biofuels, hydrogen technologies) that need to be developed as 

rapidly as possible to the level at which they can begin to act as significant alternatives to conventional fossil fuel energy sources.

Question 7. How do we know that emissions of carbon dioxide and other greenhouse gases are causing Earth’s temperature to rise, as opposed to other factors that 

we have no control over; such as sun spots? Some assert that an increase in solar 

irradiance is the main cause of the Earth’s current warming trend. Therefore, reducing fossil fuel emissions would not impact the Earth’s temperature. 

Answer. Measurements of solar irradiance have been made since 1979 from satellite mounted instruments. Small changes of up to 0.1% occur associated with the 

11 year solar cycle. There is no evidence for changes greater than about 0.2% occurring in the longer term. Over the last 50 years, radiative forcing due to changes in 

solar irradiance is much smaller than that due to anthropogenic increases in greenhouse gases (Climate Change 2001, the Scientific Basis IPCC 2001 Report, chapter 

6 and J. Hansen et al., Earth’s Energy Imbalance: Confirmation and Implications, 

in Sciencexpress for 2 May 2005 doi:1110252). 

Question 8a. There are some who question the veracity of the assertion that the 

earth has warmed substantially over the last century. Arguments typically fall into 

three categories. It would be useful if you would address each in turn: 

Urban Heat Island Effect. This is the claim that the underlying temperature data 

is tainted by the proximity of data-generating thermometers to cities. As urban 

areas have grown over the last fifty years, the air temperatures around these cities 

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have increased due to larger amounts of heat generating substances like rooftops 

and roadways. Scientists claim to have corrected for the urban heat island effect. 

How was this done, and how can we be sure that it was done correctly? 

Answer. During development of the global surface temperature compilations, data 

from each observing station were quality-controlled. This included comparisons with 

neighbouring stations. Records showing complex inconsistencies relative to their 

neighbours were rejected from the analysis. This will have removed many urban 

stations where ongoing changes in the environment have caused multiple, non-climatic changes in the record. Where the neighbour-comparisons showed simpler inconsistencies such as a relative warming trend, the urban records were retained but 

were adjusted to be consistent with their rural neighbours (e.g. Hansen, J. et al., 

2001, J. Geophys. Res., 106, D20, 23,947-23,963). 

There is substantial evidence that this procedure has been successful and that the 

land surface air temperature record used in assessment of climate change is not 

greatly influenced by urban warming. First, global rural temperature trends have 

been very similar to those based on the full network of stations (Peterson, T.C. et 

al., 1999, Geophys. Res. Lett. 26, 329-332). Secondly, ocean surface temperatures 

have risen nearly as much as those over land (Folland, C.K. & Karl, T.R. et al. 2001, 

chapter 2 in Climate Change 2001: The Scientific Basis. IPCC 2001 Report). A somewhat greater warming over land than over the ocean under increasing greenhouse 

gases is expected because of the greater thermal capacity of the oceans. Thirdly, 

temperatures on calm nights, when urban heat islands are mainly evident, show no 

more warming than temperatures on windy nights at a worldwide subset of the stations used to monitor global surface air temperature (Parker, D.E., 2004, Nature, 432, 290). 

Uncertainties regarding urbanisation effects are allowed for in the global average 

surface temperature curve shown in the IPCC 2001 Report (Climate Change 2001: 

The Scientific Basis, Summary for Policymakers, Figure 1a). These uncertainties 

play a diminished role because land is only 30% of the global surface. Even the overall uncertainties, which include the effects of incomplete coverage and possible residual biases are much smaller than the global warming signal. 

Question 8b. Satellite and Airborne Balloon Data Contradict Surface Temperature 

Readings. Global mean temperature at the earth’s surface is estimated to have risen 

by about half a degree F over the last two decades. On the other hand, satellite 

measurements of radiances and airborne balloon observations indicate that the temperature of the lower to mid-troposphere (the atmospheric layer extending from the 

earth’s surface up to about 8 km) has exhibited almost no change during this period. 

Please explain whether this discrepancy is, indeed, real and how to account for it. 

Answer. Over the last few years, much careful and detailed study has been addressed to surface, balloon and satellite temperature observations taken over the 

last 25 years and the relationships between them. I summarize briefly in this answer the conclusions from a number of key papers that are now available describing 

this work, some of them published as recently as this August and two that will be 

published over the next two or three months. Because of the number of papers to 

which I am referring, for convenience I list all the references at the end of this answer. The main outcome of this work is that statements that the lower to mid-troposphere shows no warming trend or has cooled relative to the surface are no longer 

tenable. Such statements rely upon analyses of old radiosonde datasets, which had 

not adequately accounted for instrumental and observational biases, and a single 

satellite dataset. The first U.S. Climate Change Science Program report 

(www.climatescience.gov), which will be published in the late fall, is on this subject 

and will provide a far more detailed answer than is possible here. 

Efforts in the last few years have led to significant revisions to existing upperair temperature datasets and the production of a number of new balloon-based 

(Lanzante et al., 2003a, b, Thorne et al., 2005a) and satellite-based (Mears et al., 

2003, Grody et al., 2004, Mears and Wentz, 2005) climate datasets under different, 

seemingly reasonable, approaches. An alternative approach to removing the stratospheric influence from the satellite records has also been proposed (Fu et al., 2004). 

Therefore the scientific community now have at their disposal a much larger number of independently derived estimates of tropospheric temperature change to 

analyse. Globally, the estimates of the average temperature trend for the period 

over which satellite data are available range from a slight warming to warming 

greater than that seen at the surface. It can be concluded therefore that the tropospheric data are consistent with a temperature trend similar to that at the surface, 

although the uncertainties are such that a relative cooling of the troposphere also 

cannot be ruled out. 

Uncertainty in tropospheric trends is much greater than uncertainty in surface 

trends, reflecting the greater technological challenges of adequately monitoring 

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changes aloft than at the surface. Only with the advent of recent datasets (see 

above) has the importance of structural uncertainty—the effects of methodological 

choices employed to identify and remove non-climatic influences from the raw data 

during dataset construction upon the climate dataset that results—become apparent 

(Thorne et al., 2005b). 

Much of our uncertainty in temperature trends aloft arises in the tropics. Mears 

and Wentz (2005) have highlighted an error in the original satellite record of 

Christy et al. (2003) which led to a spurious cooling bias in the tropics. Balloonbased records are also sparsely located in the tropics, and have tended to launch 

only at local daytime (rather than twice-daily that is more common elsewhere). Daytime biases in radiosonde records are more pervasive due to solar-heating effects, 

and the lack of day and night launches at these stations potentially makes identification and removal of any non-climatic influences much harder (Lanzante et al., 

2003a, Sherwood et al., 2005). 

Santer et al., 2005 have recently compared tropical temperature predictions from 

19 climate models run with historical changes in human-induced and natural forcing factors with four of the current observational datasets (2 balloon based, 2 satellite based). Within the tropics our expectations are that surface anomalies will be 

amplified aloft because of latent heat release upon condensation under a convective 

regime. All the models exhibit this behaviour on all timescales from monthly variability up to inter-decadal trends regardless of differences in model physics, resolution, and the forcings applied. The observations also exhibit amplification aloft on 

short timescales, but all except one dataset exhibits damping aloft on long 

timescales. Either in the real-world different processes dictate low-and high-frequency behaviour in the tropics and all the models fail to capture this, or, more 

plausibly, most observational datasets retain significant biases which impact their 

suitability for long-term trend analysis. Gaining unambiguous clarification of which 

is the case and gaining a cleaner estimate of recent tropospheric temperature 

changes in the tropics is seen as a high priority. 

Question 8c. The Hockey Stick. In recent months, there have been assertions that 

the statistical method used to analyze global temperature data for the last several 

hundred years was biased towards generating the ‘‘hockey stick’’ shaped curve that 

shows sustained low and stable temperatures for hundreds of years with an extremely sharp rise in the last 100 years. Can you comment on whether the observations depicted in the hockey stick curve are, indeed, legitimate? 

Answer. I have received a similar question from Senator Talent (Q6). I provide 

the same reply to both questions. 

This is a fast moving area of research. Very recently the assertions by McIntyre 

and McKitrick (2005a, b) (MM), alluded to in the question (references at end of answer), have been shown by several papers to be largely false in the context of the 

actual data used by Mann and co-workers. Ammann (a palaeontologist at the National Centre for Atmospheric Research) and Wahl of Alfred University have two papers, one in review and one in press, that reproduce the original results published 

by Mann et al. in Nature in 1998 and Geophysical Research Letters, 1999 and 

prominently used in the IPCC Third Assessment Report. They demonstrate that the 

results of MM are due to MM having censored key proxy data from the original 

Mann et al. (1998) data set, and to having made errors in their implementation of 

the Mann et al. method. They specifically show that 15th century temperatures, related to the bristlecone pine issue, were not similar to 20th century temperatures, 

as was suggested by MM. Amman and Wahl issued a press release in May 2005 

on this finding. Fuller details are at http://www.ucar.edu/news/releases/2005/

ammann.shtml These authors state that they will make their full computer code 

available publicly. 

A specific claim is made by MM that the ‘‘hockey stick’’ shape of the Mann et al. 

reconstructions is derived from the way Mann et al. normalise and centre their principal component pattern data. This has recently been tested. Rutherford et al. (in 

press, Journal of Climate) have shown that essentially the same result as Mann et 

al. is obtained using an entirely independent statistical method on similar data. 

This eliminates the step of representing regional tree-ring networks by principal 

components. The likely reason why Mann et al. were able to successfully use their 

particular technique is because the structure of paleoclimate data is more complex 

than the temporal ‘‘red noise’’ tested by MM. 

Other investigators have reconstructed climate over the past 1000 years using 

very different techniques and different selections of data. Some of these results are 

recent, and some were shown in Fig 2.21 of the IPCC Third Assessment Science Report, Climate Change 2001. These authors tend to find a greater magnitude of climate variability than did the Mann et al. ‘‘hockey stick’’ results. In particular the 

‘‘Little Ice age’’ centred around 1700 is generally cooler. Some of the more recent 

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papers of this type show a Little Ice Age cooler by up to several tenths of a degree 

centigrade than any reconstruction shown in the Third Assessment Report in Fig 

2.21, including that of Mann et al. However, all but one recent papers (Esper et al., 

2002, Mann & Jones, 2003, Moberg et al., 2005, Huang, 2004, Jones & Mann, 2004, 

Bradley et al., 2003) find that the warmth of the late 20th century is still exceptional, as their reconstructions of the temperature level relative to the 20th century 

in the Medieval warm period are similar to the Mann et al. results. Soon & 

Baliunas concluded that the late 20th century was not unusually warm but their 

methodology was flawed (Mann and Jones, 2003) as they equated hydrological influences with temperature influences and assumed that regional warmth corresponded 

to hemispheric warmth. 

I am sure that the IPCC Fourth Assessment Report will fully take all these new 

findings into account. In the meantime, it is important to recognise that no evidence 

has emerged that seriously calls into question findings regarding the climate of the 

20th century and the influence of human activities as described in the IPCC 2001 

Report. 

Question 9. Some say that global warming might be a positive development? Will 

agricultural crop productivity improve due to the greater amount of CO2 in the atmosphere, and can we expect the Arctic and Antarctic regions to become more habitable? 

Answer. 

ON CROP PRODUCTIVITY

Higher concentrations of CO2 can enhance the productivity of crops that undergo 

C3 photosynthesis (wheat, rice and most temperate crops) by fertilizing photosynthesis. In areas subject to water stress, productivity may also potentially be enhanced through higher CO2 concentrations increasing the efficiency of water use. 

Crops with C4 photosynthesis (maize, sorghum, millet, sugar cane) will not benefit 

from increased CO2 in these ways. 

These direct effects of CO2 on crops should be viewed in the context of indirect 

effects due to the climate change arising from increasing CO2. Crops are affected 

by changes in temperature and moisture availability. Warming in cold regions is expected to create generally more favourable conditions for crops, although the expansion of crop areas would be limited by soil quality and day length. In regions currently under agriculture, the specific types of crops which may be grown are expected to change with warming; C4 crops may become more favoured in temperate 

regions. However, higher temperatures would be expected to lead to a greater requirement for irrigation due to increased water loss by evaporation. Warming may 

also increase the prevalence of some pests and diseases. 

Moreover, changes in precipitation patterns could have major impacts. Some regions are predicted to become wetter and others drier. Wetter conditions in general 

would promote growth although increased severe heavy rainfall and floods would 

damage crops. Drier conditions in general would place greater demands on irrigation which itself would be subject to decreasing supply and competition from other 

uses such as drinking water and industry. Extreme high temperatures and droughts 

could have catastrophic impacts. In summary, some regions would expect net positive impacts whilst other would expect net negative impacts. Research on cereal 

yields assessed in the IPCC Third Assessment Report, which should be regarded as 

early work in an ongoing field of research, suggested that the greatest decreases in 

yield are expected in the tropics while some temperate and cold regions may see an 

increase in yield in the medium term. 

It should also be noted that other changes in atmospheric chemistry related to climate change may affect crop yields. In particular, increases in ozone concentration 

are expected to be detrimental. 

ON HABITABILITY OF THE ARCTIC AND ANTARCTIC

There may be an expansion of cropping regions towards/into the Arctic, although 

this would also be limited by other factors as described above. In general, the problems associated with extreme cold temperatures would be expected to decrease. New 

issues would arise with warming, such as ground subsidence due to permafrost 

melting. Antarctica is expected to remain ice covered for the next century and beyond. 

Question 10. It is my understanding that the assessments of the progression of 

global warming through the next century and its impacts on changing the Earth’s 

climate are largely based on computer modeling. It goes without saying that the 

planet’s atmospheric, hydrologic, and meteorological systems are highly complicated. 

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What can you say about how climate modeling capabilities have advanced since scientists began evaluating the problem? 

What is the level confidence that the computer models are providing useful projections of the future climate? 

Answer. 

HOW HAVE CLIMATE MODELING CAPABILITIES ADVANCED SINCE SCIENTISTS

FIRST BEGAN EVALUATING THE PROBLEM?

Since the early days of modern climate modeling in the 1970s, scientists have progressively modeled more of the processes that play a role in climate. For example, 

early models represented only the atmosphere, with a very simple representation of 

ocean effects. Later the effects of changing ocean currents and ice were taken into 

account, and recently scientists have begun to model the interactions of climate with 

the biosphere. At the same time, our developing understanding of each system (atmosphere, ocean, etc.), together with increasing computer power, have meant that 

each component can be represented with greater realism. 

As an example, today we are able to represent the circulations of the atmosphere 

and the ocean coupled together with sufficient realism that models reproduce many 

of the observed, large scale features of climate. Ten years ago this was only possible 

with the use of so-called ‘flux adjustments’ which corrected for the long term effects 

of slight errors in the models’ heat distribution. Ten years before that we had not 

even begun to include the effects of ocean currents in models. 

The ongoing development of models has led to increasing confidence in the modeling of many climate phenomena such as El Nin ̃ o, monsoons, Arctic climate processes and the North Atlantic Oscillation. 

Throughout this history of development, the models’ prediction of a substantial 

global warming in response to increasing greenhouse gases has been consistent and 

unambiguous. As models improve we are able to add more detail and confidence. 

WHAT IS THE LEVEL OF CONFIDENCE THAT THE COMPUTER MODELS ARE PROVIDING

USEFUL PROJECTIONS OF FUTURE CLIMATE?

Confidence in model projections comes from three sources: the fact that they are 

based in fundamental physical principles such as conservation of energy, the fact 

that when driven by present day levels of solar energy input and concentrations of 

greenhouse gases and other trace species, they reproduce many observed features 

of present climate, and the fact that when driven by historical variations in those 

factors, they reproduce observed variations in climate. The development over the 

past 20 years of model formulation (discussed above) has seen a parallel increase 

in the veracity with which the models represent observed climate changes and variability. 

The success of models in reproducing present and past climate lead us to believe 

that they are capturing much of the fundamental physics of the climate system. 

Hence the comprehensive climate models provide the best tool available to assess 

future climate change. Nonetheless there are quantitative differences between projections made with different models, and these differences represent a level of uncertainty in the modeling. By detailed analysis of the models, scientists can identify 

sources of uncertainty—for example the modeling of clouds continues to be an important issue—and by a painstaking process of research reduce that uncertainty 

over time. Models generally have greatest skill on larger scales, and as a generalization, the larger the scale (global, continental) the more robust are the modeling results. 

Question 11. It is often asserted, by those who dispute the strength of the evidence of human-caused climate change, that the IPCC process has been politicized 

in a way that has tended to exaggerate the evidence for the reality of the problem 

and to understate the uncertainties. As the Chair of the IPCC’s Working Group I 

on the science of climate change itself, could you characterize for us any political 

pressures you and your Working Group have experienced? 

Answer. First, let me say that, as chair of Working Group I, a crucially important 

task for me was to ensure that any bias, agendas or pressures for political or other 

reasons (for instance personal agendas) were not allowed to get in the way of accurate, honest and balanced appraisal of the science. 

During my years working with Working Group I, although I was supported in 

that task by the U.K. government, I played no part at all in the formulation or presentation of U.K. policy on climate change. The U.K. government made it clear that 

they expected me to avoid and refuse all political or other improper interference 

from whatever quarter in my IPCC work. 

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The occasions when political pressures were most apparent were the intergovernmental meetings when the Summaries for Policymakers (SPM) were discussed and 

approved. At these meetings, typically about 100 governments were represented and 

about 40 scientists representing the lead authors of the chapters were present to 

ensure the scientific integrity of the final document. The meetings were also open 

to representatives of non-governmental organizations from both the environmental 

and industry sides. The purpose of these meetings was to make sure that the SPMs 

were accurate and balanced scientifically and also that their presentations were 

clear, understandable and policy relevant. 

The political pressures at these meetings that tended to be the most obvious and 

persistent came from a small group of oil producing states assisted by some of the 

industrial NGOs who worked to weaken or remove statements expressing the reality 

of climate change and its likely impacts. Less persistent pressures to strengthen 

such statements tended to come from some of the environmental NGOs and from 

a few country delegates. All proposals for change arising from these pressures were 

subjected to careful scientific scrutiny. After this thorough scrutiny (sometimes taking a substantial amount of time) the final text was accepted by all parties and all 

scientists without dissention—with one exception that occurred in 1995 when it became necessary to add a footnote expressing dissension by two countries, a footnote 

that was in fact withdrawn before the document’s publication. 

The final summary in each case was as accurate, balanced and unbiased as it was 

possible to make it. In every case, the SPM was improved in both accuracy and clarity by the process of the intergovernmental meeting. I can say categorically that 

there was no tendency to exaggerate evidence for the reality of the problem or to 

understate the uncertainties. If anything, the tendency was the other way—to be 

cautious in our statements and to make sure that we fully represented the uncertainties. The growth in the confidence expressed by the IPCC in its statements from 

the 1990 report through the 1995 report to the 2001 report, I believe, illustrates the 

IPCC’s tendency to caution. 

Question 12. In the 1970s, climate scientists claimed that the world was cooling 

and anthropogenic activities might be prematurely forcing the planet into an ice 

age. Today we hear that the earth is warming. What can you say about the scientific debate on cooling several decades ago and why is today’s situation with global warming different? 

Answer. There were some very cold winters in Europe and North America in the 

1960s that led some scientists to speculate that we might be entering a new ice age. 

Most climate scientists disagreed with and indeed opposed that speculation—as I 

did—pointing out that there was nothing in the 1960s outside the range of natural 

variation. Also, according to the theory that ice ages are triggered by regular variations in the Earth’s orbit that can be predicted precisely from astronomical data, 

the current interglacial period has tens of thousands of years to run before the appropriate conditions for the next ice age occur. 

The current situation with global warming is very different. First, the basic physics of increasing surface temperature with increasing greenhouse gases has been 

known since the early 19th century. Secondly, the increase in global average temperature during the last 50 years is very unlikely to be due solely to natural variability. Thirdly, climate models that include the relevant physics and dynamics of the 

atmosphere’s and ocean’s structure and circulation are unable to simulate the profile of temperature increase unless the radiative forcing due to the anthropogenic 

increase of greenhouse gases is included in addition to all known natural forcings. 

RESPONSES OF SIR JOHN HOUGHTON TO QUESTIONS FROM SENATOR BUNNING

Question 1. Would you say that the steps America has taken in the recent years 

to improve energy efficiency and produce lower carbon emissions from power generation are the right first steps in addressing climate change? Within that construct, 

given the current U.S. electricity supply that is more than 50% derived from coal, 

is encouraging clean coal technology, IGCC and carbon sequestration the most important immediate policy action we can take? 

Answer. I agree that increasing energy efficiency across the board (e.g. in buildings, appliances, vehicles and in industry) is an essential part of action to address 

climate change. It has the advantage that most such actions are win-win in character i.e. they will lead to significant, even large, savings in cost or materials as 

well as in carbon emissions. There are numerous examples, for instance from U.S. 

industries, of the economic and other benefits of increased efficiency. 

The other main action to address climate change mitigation is for the generation 

of energy to move as rapidly as possible to be less carbon intensive and eventually 

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to be close to carbon free. It is clear that clean coal technology (IGCC and carbon 

sequestration) will play an important role in this future. 

Question 2. Sir Houghton, you testified that over two thirds of the projected increase in emissions from now until 2030 will come from developing countries. Do 

you believe it would be responsible for EU countries and America to adopt an emissions reduction that failed to include this part of the world? 

Answer. Countries who have joined the Kyoto Protocol have adopted emissions reductions that do not include developing countries. This is in line with the Framework Convention on Climate Change (FCCC) agreed by all nations in 1992 that 

states that industrialized nations that have already received large benefits from fossil fuel energy should be first to take action on climate change. But I agree that 

any international agreements post-Kyoto for emissions reductions need also to involve developing countries, especially those that are industrializing rapidly. I say a 

little more about this in my answer to Q3. 

Question 3. You indicated in your testimony that America needs to take a global 

leadership position on climate change. You argued that developing nations will ‘‘follow, not lead’’ on the issue of climate change and that mandatory agreements with 

these nations would not be necessary as they voluntarily adopt emissions standards 

in the future. Yet the mandatory cap program recommended by the NCEP specifically discounts voluntary cap programs in America as unable to achieve necessary 

reductions. They have argued that without mandates, the marketplace will not 

make the adjustments needed to achieve the very aggressive goals envisioned. Do 

you believe it is consistent to advocate a ‘‘follow, not lead’’ voluntary approach with 

developing nations while dismissing the same approach in America? 

Answer. Let me explain the arguments behind my use of the phrase ‘follow, not 

lead’ in respect of developing countries. 

As I explained in my written testimony, we in the developed countries have already benefited over many generations from abundant and cheap fossil fuel energy—although without realizing the potential damage to the climate and especially 

the disproportionate adverse impacts falling on the poorer nations. The Framework 

Convention on Climate Change (FCCC) recognized the particular responsibilities 

this placed on developed countries to be the first to take action and to provide assistance (e.g. through appropriate finance and technology transfer) to developing 

countries for them to cope with the impacts and to develop cost effective sources of 

energy free of carbon emissions. This is at the basis of my ‘follow, not lead’ approach. 

But it is not my intention to associate this approach only with voluntary action. 

Given the fact of first action taken by developed countries, for instance through the 

Kyoto Protocol, I agree that further action with mandatory targets and requirements are necessary for all countries. That is the urgent challenge of the next stage 

of negotiations that is taking place within the FCCC in which all countries—both 

developed and developing—must be involved. 

Question 4. While you have presented what appears to be a united scientific front 

in the form of the statement from the academies of science from 11 countries, I am 

concerned by some of the news since the release of that statement. The Russian 

Academy of Sciences says it was misrepresented and that Russian scientists actually believe that the Kyoto Protocol was scientifically ungrounded. I am also aware 

that there was a significant misrepresentation on the science between our academy 

and the British representative. 

Given this background, wouldn’t you say there are still some pretty fundamental 

disagreements about the science of climate change among scientists around the 

world? 

Answer. I have consulted the Royal Society in London about the questions you 

have raised about the joint statement from the academies and they have provided 

me with the information that follows in the rest of this answer. 

All of the national academies that signed the joint statement on global climate 

change remain committed to it, and there is not, nor has there ever been, any disagreement between the signatories over its content. 

There have been media reports that a member of the Russian Academy of 

Sciences, who is well-known for his opposition to the Kyoto Protocol, has requested 

that the Academy’s President, Professor Yuri Osipov, should withdraw his signature 

from the joint statement. Professor Osipov has not done so. 

There has been an exchange of correspondence between Dr. Bruce Alberts, the 

President of the National Academy of Sciences, and Lord May of Oxford, the President of the Royal Society, about a brief reference in the Society’s media release accompanying the launch of the statement to an earlier report published by the NAS 

in 1992. The exchange of correspondence has not been about the content of the joint 

statement. 

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The signatories to the joint statement by the national academies remain committed to its content and hope that it will help the governments of the G8 nations 

to determine their future actions and policies on climate change. 

Question 5. In this international academies statement, you find that an ‘‘immediate response that will, at a reasonable cost, prevent dangerous anthropogenic interference with the climate system,’’ but continue to say in the following paragraph, 

‘‘minimizing the amount of this carbon dioxide reaching the atmosphere presents a 

huge challenge.’’ Could you please elaborate, since any response can’t both be a ‘‘reasonable cost’’ and a ‘‘huge challenge’’ proposition, how you resolve the two? 

Answer. The next paragraph in the academies statement goes on to say, ‘There 

are many cost-effective technological options that could contribute to stabilizing 

greenhouse gas concentrations. These are at various stages of research and development. However barriers to their broad deployment still need to be overcome.’ The barriers that exist are not all economic ones. That this is the case is illustrated by the 

fact that it is generally agreed that many energy efficiency measures exist that 

could be implemented at no net cost or with significant cost savings—yet little action is taken about them. Other measures have been proposed that are described 

as win-win, implementation of which is not being pursued. 

One of the barriers is the wide campaign of misinformation by vested interests 

that has persuaded people and their leaders to deny the existence of the problem 

of climate change or that even if the problem exists, little or no action about it need 

be taken at the moment. 

An important part of the challenge, therefore, is first to ensure that governments, 

industries and the general public receive accurate and honest information that will 

give them the confidence to act, and secondly for governments in particular to set 

up the framework (including incentives and other appropriate economic measures) 

that will lead to action at reasonable cost. A further challenge in this process will 

be to carry out honest assessments of the ‘reasonableness’ of the costs of mitigation 

action by comparing them against the costs of inaction and the costs of adaptation, 

including so far as possible ‘costs’ that cannot be expressed in monetary terms. 

Question 6. Several scientists have cited events like the high temperatures in Europe in the summer of 2003 and increased storminess in the 1980s and 1990s as 

evidence of climate change. Don’t global ecosystems go through natural periods similar to these as well? 

Answer. There is a great deal of variability in the natural climate system and extreme events occur—and always have occurred—on account of this natural variability. Because of this variability it is not possible, in general, to identify any particular extreme event as due to the increase of greenhouse gases through human 

activities. However, in mentioning the heat wave in Europe in 2003, in which over 

20,000 people died, you cite the one recent event that is so very far outside the 

range of natural variability (the average temperature for the months of June, July 

and August in central Switzerland was 5 standard deviations away from the average since instrumental records began 140 years ago) that analysis shows that most 

of the risk of that event is almost certainly due to the increase in greenhouse gases 

(Stott, P.A. et al. 2004, Nature 427, 332-6). It therefore does provide evidence that 

human induced climate change is occurring. 

Regarding the increased storminess of the 1980s and 1990s relative to the 1950s, 

this has been studied by insurance companies. They report an increase during this 

period in the number of weather of weather related disasters by a factor of 5 and 

in the economic cost (adjusted for inflation) of such disasters of a factor of 10. Although part of these observed upward trends is related to socio-economic factors 

(population growth, increased vulnerability and increased wealth) a substantial part 

is also linked to the increased frequency and intensity of such events (Climate 

Change 2001: the Synthesis Report, IPCC 2001). 

This increased trend in the frequency and intensity of such events is what is expected in a world that is warming due to increased greenhouse gases. As I explained 

briefly in my written testimony, there are scientific reasons for this trend and further it appears as a robust result from climate models. 

Question 7. There are a number of astrophysicists and other scientists who believe 

that sunspots are a major contributor to changing temperatures. A recent survey 

showed at least 100 such studies are underway. Why don’t scientists put as much 

emphasis on this possibility or other aspects of natural climate variability as they 

do on emissions from human activity? 

Answer. The IPCC in its reports has considered all aspects of natural variability 

as well as the effect of greenhouse gas emissions from human activity. A substantial 

section of chapter 6 of the IPCC 2001 Report, Climate Change: the Scientific Basis

is devoted to possible solar influences on climate and about 50 papers on the subject 

are cited. It remains a subject of serious scientific research interest. 

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The IPCC’s task, however, has been to compare all known natural influences on 

climate (including solar influences) with the effects of increasing greenhouse gases. 

Measurements of solar irradiance have been made since 1979 from satellite mounted instruments. Small changes of about 0.1% occur associated with the 11 year sunspot cycle. There is some evidence for solar influence on climate over the last few 

centuries, for instance during the first few decades of the 20th century. But the influence is small. Over the last 50 years, radiative forcing due to changes in solar 

irradiance is much smaller than that due to anthropogenic increases in greenhouse 

gases (see also J. Hansen et al., Earth’s Energy Imbalance: Confirmation and Implications, in Sciencexpress for 2 May 2005, doi:1110252) 

Question 8. Much of the discussion about climate science being settled is based 

on the summary chapter of the Intergovernmental Panel on Climate Change of the 

United Nations. The chapter made specific predictions about the pace of rising temperatures and the relative importance of human activities to climate change. And 

yet, the body of the report is much more ambiguous and inconclusive about the current state of the science. Is anything being done to ensure that the summary of the 

next IPCC report is more reflective of the overall analysis by the scientists? 

Answer. I am aware that statements are often made and quoted asserting that 

the Summaries for Policymakers (SPM) of the IPCC reports do not accurately reflect 

the science of the underlying chapters. Yet, to my knowledge, none of those expressing such views have provided evidence or examples to support them. 

It is important to recognize the IPCC’s purpose in preparing an SPM for its reports. As an intergovernmental body, the IPCC is bound to produce its conclusions 

succinctly and in a form that is understandable by policymakers and relevant and 

helpful to their needs. The SPM therefore is not a scientific summary of all the 

science laid out in the chapters. It does not list, for instance, all the factors or all 

the arguments involved in the scientific appraisal of any given area. Each chapter, 

in any case, produces its own scientific summary. The SPM is a summary of conclusions, largely taken from the chapter summaries, selected for their policy relevance 

and in the drafting of which lead authors from the chapters have played a full part. 

It is also important, as your question implies, that the SPM adequately expresses 

the degree of certainty to be associated with any conclusion. The IPCC has spent 

a lot of time debating how this can best be done and a large proportion of the time 

in the intergovernmental meetings that have approved the SPMs (see also my answer to Q11 asked by Senator Bingaman) has been taken up with ensuring that the 

final SPM text accurately reflects the chapters in the degree of confidence expressed 

in the conclusions. When this has to be done succinctly, as the SPM requires, it is 

helpful for confidence to be expressed quantitatively. For instance, in all the IPCC 

scientific reports, so far as possible, numerical values quoted in the conclusions also 

included error bars to express their uncertainty. In addition, in the 2001 IPCC Report, many of the more qualitative statements have been made quantitative by attaching to them numerical estimates of probability. For instance, a given conclusion 

described as likely is estimated to have a probability of being true in the range 67% 

to 90% and as very likely when its probability of being true is estimated as in the 

range 90% to 99%, and so on. In this way, uncertainties have been presented in a 

manner that can be more easily interpreted and used by policymakers, especially 

when the impacts of climate change have to be folded into the consideration of wider 

policy issues involving future energy generation or the provision of security. 

Further, in the IPCC 2001 SPM, clearly listed are areas of importance where 

there is no evidence of change, for instance in sea ice cover in the Antarctic or in 

the average number and intensity of tropical cyclones over the 20th century. 

I have no doubt at all that matters regarding the accuracy and balance of the 

SPM and the way uncertainties are represented continue to be very fully discussed 

within the IPCC as it prepares the Fourth Assessment Report. 

Question 9. The natural ‘‘greenhouse effect’’ has been known for nearly two hundred years and is essential to the provision of our current climate. There is significant research in the literature today that indicates humans, since the beginning of 

their existence, have caused an increase in the greenhouse effect. Some argue that 

the development of agriculture 6,000 to 8,000 years ago has helped to forestall the 

next ice age. The development of cities, thinning of forests, population growth, and 

most recently the burning of fossil fuels, have all had an impact on climate change. 

Our ecosystems have constantly adapted to change, as we as humans have adapted 

to our ecosystems as well. Is it possible that the increased presence of CO2 caused 

by the 8,000 years of modern human existence may be something our ecosystems 

will continue, as they previously have, to naturally adapt to? 

Answer. According to data from the Vostok and Taylor Dome ice cores, atmospheric CO2 concentration rose by 20ppm (from 260ppm to 280ppm) between 8,000 

years ago and the start of the industrial era (circa 1750). Since then, CO2 has risen 

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to 377ppm in the Mauna Loa record. This is higher than at any time in the 440,000 

year ice core record and also higher than at any time in the last 20 million years 

according to geochemical evidence. There are therefore no examples in the recent 

past to which we can refer for evidence of adaptation to current or projected future 

CO2 levels. 

The amount of the CO2 rise over the last 250 years has been nearly 5 times that 

seen over the previous 8,000 years, with the rate of rise 150 times faster. Ecosystems will already need to be adapting more rapidly than before. In the six illustrative SRES scenarios examined in the IPCC Third Assessment Report of 2001, the 

CO2 concentration reaches between 540ppm and 970ppm over the next 100 years. 

These correspond to rates of rise of 650 to 2300 times faster than over the 8,000 

years pre-industrial. Adapting to the associated climate change under any of these 

scenarios will become increasingly difficult for both ecosystems and humans. 

Question 10. The panel touched on some energy alternatives such as biomass, natural gas, and nuclear power, yet there was little mention of hydrogen power. From 

a scientific viewpoint, where do you think we are on being able to really utilize hydrogen power? What is the potential of hydrogen power? 

Answer. Hydrogen has many advantages as a fuel in that it is very non-polluting 

and is ideal for using in fuel cells that are potentially highly efficient and convenient devices for producing electricity. Further, providing the hydrogen is produced 

from a carbon-free source, it does not add to the greenhouse effect. 

Hydrogen power does not, however, exist in isolation from the means by which 

the hydrogen is produced. That may be from solar energy or from the energy alternatives that you have mentioned such as biomass, natural gas or nuclear sources. 

Hydrogen essentially provides a secondary rather than a primary source of energy. 

There seems to be general recognition that hydrogen has great potential and will 

become an important and probably dominant fuel in the future. Before this occurs 

on a very large scale, substantial further development of fuel cells and of technologies for hydrogen storage are required especially for use in vehicles. 

Question 11. The panel established very clearly that we should adopt policies that 

decrease carbon emissions regardless of any other carbon emissions policies we pursue. We are currently or will shortly be providing expanded incentives for clean coal, 

nuclear energy and renewable fuels. Do you feel this is money well spent? What 

technologies do you feel the government should be more involved in developing? 

Answer. I am not an expert on energy policy so can only make a general comment. 

It is clear, I believe, that there is no one solution to the challenge of moving to carbon free energy, so all possibilities need to be explored and assessed. There are also 

comparatively new technologies, especially some in the field of renewables, that will 

require considerable government support before they can become commercially competitive. 

RESPONSES OF SIR JOHN HOUGHTON TO QUESTIONS FROM SENATOR TALENT

Question 1. There has been a fair amount of criticism of the output of the models 

used to forecast possible climate conditions in the future, due in part to the data 

assumptions made. How responsive has the IPCC been to external criticism? Has 

this criticism led to any modeling or data input revisions, and what was the result 

of these revisions? 

Answer. In contrast to models of the economy, for example, climate models are 

not based on empirical or statistical extrapolation but they possess a sound theoretical basis in the established laws of physics and dynamics. These include the laws 

of conservation of mass, heat, moisture and momentum and the equation of state. 

Future projections are determined through integration of the equations describing 

these laws together with Newton’s equations of motion. Such models are essential 

tools for adding together all the non linear processes involved in the behaviour of 

the total climate system. A good description of the present state of climate modeling 

can be found in J.F.B.Mitchell, Can we believe predictions of climate change? 

Q.J.R.Meteorol.Soc., 130, 2341-2360, 2004. 

There has been enormous development in the size, sophistication and skill of climate models over the last 30 years. The global modeling community has been closely involved in the IPCC process and contributed a great deal to it. In particular, 

for the 2001 IPCC Report, 20 groups in different institutions and countries running 

over 30 general circulation models with full coupling between the atmospheric and 

ocean circulations set up elaborate procedures to evaluate and compare formulations 

and results between all 30 models. This process has been highly productive in leading to improvements in model performance, creating increasing confidence in model 

results and providing guidance for model developments. 

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Many of the criticisms of models commonly voiced concern older models in some 

of which adjustments (e.g. flux adjustments at the atmosphere-ocean boundary) had 

to be made the validity of which was questioned. The modeling community has 

worked to remove such limitations. For instance, modern models do not require flux 

adjustments. The main uncertainties in models that remain arise from difficulties 

of adequately dealing with clouds and with the ways in which small scale motions 

(too small for discrete model description) influence motions on the larger scale. Uncertainty about clouds is the main reason for the range of uncertainty from 1.5 to 

4.5° C still quoted by the IPCC for the climate sensitivity (the increase in equilibrium surface temperature arising from a doubling of carbon dioxide). 

Question 2. You say in your written testimony (p. 7) that the Kyoto Protocol is 

just a ‘‘beginning for the process of reduction’’ for countries that ratified the protocol. What level of cuts are necessary to reach the goal of Kyoto? If the EU is having trouble meeting the ‘‘beginning’’ targets, how will they meet the necessary targets without wrecking their economies, and how are the rising emissions of developing countries factored in? 

Answer. I have consulted with the U.K. government in providing this answer. The 

goal of the Climate Convention is to stabilise greenhouse gases in the atmosphere 

at levels which avoid dangerous anthropogenic climate change. The European Union 

(EU) has suggested that this would mean avoiding temperature rises greater than 

2 degrees Celsius above pre-industrial levels. Recent research indicates that to do 

so requires global greenhouse gas emissions to peak within the next two decades, 

followed by substantial global reductions relative to 1990. These would need to be 

of the order of at least 15% and perhaps as much as 50% by 2050. Developed countries would need to take greater action which suggests that their emissions will 

need to fall by between 60 and 80% of current levels by 2050. Kyoto is thus clearly 

just a first step as its goal is to achieve reductions in developed country emissions 

in the near term (2008 to 2012). However the Protocol includes built in mechanisms 

for considering what actions should be taken by parties in the period after 2012 and 

initial discussions on this are due to begin among Kyoto parties at the 1st meeting 

of the Parties to the Kyoto Protocol, this November in Montreal. 

With regard to the EU’s Kyoto targets, a recent European Commission report 

(http://europa.eu.int/eur-lex/lex/LexUriServ/site/en/com/2004/

com2004l0818en01.pdf) suggests that a combination of existing domestic policies 

and measures, additional policies and measures which are already in an advanced 

state of planning, and emission credits gained through the Kyoto Protocol’s projectbased mechanisms will deliver a total EU-15 emissions cut of 8.6% by 2010 (the EU15 target is ¥8%). The EU Council of Ministers has set out a range of emission 

reduction pathways, as noted above, to consider when discussing the future with 

other parties. The U.K. aims to use its Presidency of the EU to launch the process 

of developing strategies or pathways to deliver those kinds of medium and long term 

targets. The U.K. hopes to introduce in the EU the same kind of process taken by 

the U.K. in 2003 when it formulated its Energy White Paper, undertaking the necessary work to demonstrate that future targets adopted are achievable and compatible with healthy economic growth. 

Question 3. You note in your written testimony (p. 8) that for the U.K. to meet 

its target of 60% reductions by 2050, it would suffer a loss of 6 months’ growth over 

50 years, or 1% of the growth over that time period. How much money in GDP and 

how many lost jobs does that represent? Does this result in any reduction in emissions, particularly in light of the fact, as you note, that China is building the equivalent of a 1 gigawatt, fossil-fuel powered generating station every week? 

Answer. I have consulted with the U.K. government in providing this answer. 

Analysis for the U.K.’s Energy White Paper in 2003 concluded that the costs of 

achieving a 60% reduction in CO2 emissions might be around 0.5-1% of GDP in 

2050. This would be broadly equivalent to a reduction of about 0.01 percentage 

points a year in the assumed GDP growth rate of 2.25% a year. The cost to GDP 

in 2050 is estimated to be between £10bn and £25bn per annum (in 2000 prices) 

by 2050 compared with a forecast level of GDP in 2050 of around £2500bn. There 

are no figures available for the effect on employment. If the U.K. achieves a 60% 

reduction in its carbon dioxide emissions this would mean that the U.K.’s annual 

emissions had fallen to around 65 million tonnes of carbon by 2050, about 90 million 

tonnes lower than they are currently. To put this in context, a new 1 GW coal-fired 

power station might be expected to emit around 1.5 million tonnes of carbon per 

year. The Energy White Paper recognises that it won’t be enough for the U.K. to 

act alone and that others will need to make comparable efforts to meet the challenge of climate change. 

Question 4. The time for greenhouse gas emissions in the atmosphere to decay, 

as predicted by the IGCC model is about 37 months. However, actual experience 

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based on studies of volcano eruptions suggest a decay time of half of that (Michaels 

and Knappenberger, 2000) or less (Douglass and Knox, Univ. of Rochester, reported 

in Geophysical Research Letters), meaning a lower climate sensitivity and lower the 

future temperature rise. Have the IGCC numbers been rerun to account for this actual data, rather than sticking to the modeling assumptions? 

Answer. Different greenhouse gases have different lifetimes in the atmosphere. 

The fundamentals of their atmospheric cycles and lifetimes are well understood. I 

do not recognize to what decay the 37 months refers. However, I believe the Senator’s question is rather about the transient climate response observed after the 

Pinatubo volcanic eruption and how this might be used to constrain our knowledge 

of climate sensitivity and ‘‘global warming commitment’’ (the extra-warming in the 

pipeline once greenhouse gas concentrations have been stabilized). The climate response to stratospheric aerosols induced by the Pinatubo eruption has been used in 

a number of studies to attempt to provide information about climate sensitivity or 

the time constant of climate response to perturbations in radiative forcing such as 

occurs with greenhouse gases. The one you cite by Douglass and Knox essentially 

employs an extremely simplistic one-dimensional model that includes no allowance 

for the ocean and also employs an incorrect definition of radiative forcing. Other 

studies have used full three-dimensional climate models (Kircher et al., Journal of 

Geophysical Research, 104, 19039-19055, 1999; Soden et al., Science, 296, 727-730, 

2002) and find that moderate to high climate sensitivities (i.e. 3 to 4.5 degrees C 

for a doubling of CO2 at equilibrium) are compatible with the observations. However, as pointed out by R.S. Lindzen and C. Giannitsis (J. Geophys. Res., 103, 5929-

5941, 1998) in a detailed study on the climatic effects of volcanic cooling, the uncertainties associated with the climate response are such that no clear conclusions can 

be drawn regarding either climate sensitivity or the time scale of climate response 

from studies on a single volcanic eruption such as Pinatubo. 

Question 5. What has been the pattern of findings as the science improves—more 

or less climate sensitivity to carbon concentration in the atmosphere, greater or lesser projected warming? E.g., I understand that the large majority of models predict 

a more modest warming of 2-5 degrees F, as opposed to IGCC’s Third Assessment 

Report which predicts about 11 degrees F (6 degrees C) by 2100. 

Answer. The IPCC’s Third Assessment Report in fact gave an uncertainty range 

of 1.4 to 5.8 degrees C (2.5 to 10.5° F) for the projected global average temperature 

rise in 2100—you just mention the top end of that range. Included in that range 

are uncertainties in projections of how greenhouse gases will increase in the 21st 

century (that is dependent on how emissions due to human activities evolve) in addition to uncertainties in our scientific understanding of the response of climate to 

increased greenhouse gases. The range for global average temperature rise projected 

for 2100 published in the IPCC 1995 Report of 1.0 to 3.5° C (1.8 to 6.3° F) was less 

than that in 2001, largely because of different assumptions about likely emissions 

of aerosols due to human activities and also of greenhouse gases, in the 21st century. 

The response of climate to increased greenhouse gases is described by a quantity 

called the climate sensitivity that is defined as the amount of global average temperature increase for a doubling of atmospheric carbon dioxide concentration under 

equilibrium conditions. This is a quantity determined from the science. Your question, I believe, is asking how estimates of the climate sensitivity have changed as 

our understanding of the science has improved. 

In both the First and Second IPCC assessment reports of 1990 and 1995, the 

range of estimates of climate sensitivity was 1.5 to 4.5° C (2.7 to 8.1° F). In the 

IPCC Third Assessment Report (TAR) of 2001, the conclusion drawn in the summary section of chapter 9 was that ‘‘the previous estimated range for this quantity, 

widely cited as +1.5 to +4.5° C, still encompasses the more recent model sensitivity 

results’’. However, in Table 9.4 of that chapter, the range of values of climate sensitivity in the 15 full climate models available to that chapter was quoted as from 

2.0 to 5.1° C (3.6 to 9.2° F) with a mean of 3.5° C (6.3° F), indicating a tendency 

for models at that time to show somewhat higher values of climate sensitivity. Since 

the publication of the TAR there have been a number of studies in which models 

have produced climate sensitivities in excess of 6° C (11° F) (e.g. Murphy et al., 

2004, Nature, 430, 768-772; Stainforth et al., 2005, Nature, 433, 403-406). In general, the lower end of the uncertainty range for climate sensitivity has tended to 

remain at 1.5-2° C (2.7-3.6° F) while the upper range has increased. 

In conclusion, therefore, as the science has developed and improved, there has 

been a tendency for an increase in the likelihood of greater sensitivity and greater 

warming. 

Question 6. What’s the status of the review of the Mann ‘‘hockey stick’’ temperature curve? I understand that studies by Stephen McIntyre and Ross McKitrick sugVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00170 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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gest that it relied on the statistically insignificant bristlecone pine. Is the IPCC taking another look at that work, which forms the basis for much of today’s climate 

change debate? 

Answer. I have received a similar question from Senator Bingaman (Q8c). I provide the same reply to both questions 

This is a fast moving area of research. Very recently the assertions by McIntyre 

and McKitrick (2005a, b) (MM), alluded to in the question (references at end of answer), have been shown by several papers to be largely false in the context of the 

actual data used by Mann and co-workers. Ammann (a palaeontologist at the National Centre for Atmospheric Research) and Wahl of Alfred University have two papers, one in review and one in press, that reproduce the original results published 

by Mann et al. in Nature in 1998 and Geophysical Research Letters, 1999 and 

prominently used in the IPCC Third Assessment Report. They demonstrate that the 

results of MM are due to MM having censored key proxy data from the original 

Mann et al. (1998) data set, and to having made errors in their implementation of 

the Mann et al. method. They specifically show that 15th century temperatures, related to the bristlecone pine issue, were not similar to 20th century temperatures, 

as was suggested by MM. Amman and Wahl issued a press release in May 2005 

on this finding. Fuller details are at http://www.ucar.edu/news/releases/2005/

ammann.shtml. These authors state that they will make their full computer code 

available publicly. 

A specific claim is made by MM that the ‘‘hockey stick’’ shape of the Mann et al. 

reconstructions is derived from the way Mann et al. normalise and centre their principal component pattern data. This has recently been tested. Rutherford et al. (in 

press, Journal of Climate) have shown that essentially the same result as Mann et 

al. is obtained using an entirely independent statistical method on similar data. 

This eliminates the step of representing regional tree-ring networks by principal 

components. The likely reason why Mann et al. were able to successfully use their 

particular technique is because the structure of paleoclimate data is more complex 

than the temporal ‘‘red noise’’ tested by MM. 

Other investigators have reconstructed climate over the past 1000 years using 

very different techniques and different selections of data. Some of these results are 

recent, and some were shown in Fig 2.21 of the IPCC Third Assessment Science Report, Climate Change 2001. These authors tend to find a greater magnitude of climate variability than did the Mann et al. ‘‘hockey stick’’ results. In particular the 

‘‘Little Ice age’’ centred around 1700 is generally cooler. Some of the more recent 

papers of this type show a Little Ice Age cooler by up to several tenths of a degree 

centigrade than any reconstruction shown in the Third Assessment Report in Fig 

2.21, including that of Mann et al. However, all but one recent papers (Esper et al., 

2002, Mann & Jones, 2003, Moberg et al., 2005, Huang, 2004, Jones & Mann, 2004, 

Bradley et al., 2003) find that the warmth of the late 20th century is still exceptional, as their reconstructions of the temperature level relative to the 20th century 

in the Medieval warm period are similar to the Mann et al. results. Soon & 

Baliunas concluded that the late 20th century was not unusually warm but their 

methodology was flawed (Mann and Jones, 2003) as they equated hydrological influences with temperature influences and assumed that regional warmth corresponded 

to hemispheric warmth. 

I am sure that the IPCC Fourth Assessment Report will fully take all these new 

findings into account. In the meantime, it is important to recognise that no evidence 

has emerged that seriously calls into question findings regarding the climate of the 

20th century and the influence of human activities as described in the IPCC 2001 

Report. 

Question 7. If all the countries that have signed Kyoto stay within compliance of 

Kyoto, how much of a reduction in global warming would this result in? 

Answer. I have consulted with the U.K. government in providing this answer. If 

the developed country parties make the reductions they have committed to, in the 

period 2008-2012 the reduction in projected global emissions will be up to about 2%. 

This takes account of the fact that developing country emissions will still rise as 

they do not have emission reduction targets, although mechanisms such as the clean 

development mechanism, together with technology transfer and capacity building, 

will be expected to lead to some reduction in their emissions growth. The significance of the first commitment period is as a first step for building broader coalitions 

and a longer-term engagement aimed at reducing global emissions of greenhouse 

gases, as well as the establishment of essential monitoring and measuring standards and cost-effective market mechanisms such as international emissions trading. 

Question 8. Can you confirm that suspended water vapor levels, cloud cover percentages and direct solar irradiation changes over time all represent variables in 

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these forecasting models that could have significant impacts on the conclusions of 

the results of these models? 

Answer. In the formulation of climate models, estimates of direct solar radiation 

changes with time are included, along with estimates of all other known forcing factors, both natural and anthropogenie. There are periods such as that from around 

1900-1940 when it is believed solar radiation changes had a significant effect. Any 

effect of solar radiation changes over the last 50 years, however, has been small 

compared with the effects of increasing anthropogenic greenhouse gas emissions Climate Change; the Scientific Basis, the IPCC 2001 Report, chapter 6). 

Water vapor concentration and the coverage of cloud (at different levels and of different types) are variables within the model equations that are generated within the 

model as the model integrations progress by applying the physical laws on which 

the model depends. These variables are not introduced from outside except in the 

specification of initial conditions; the influence of the these is soon lost as the integrations progress. The way in which clouds are treated within the model equations 

differs significantly amongst models. The largest single uncertainty in model results 

arises from uncertainties regarding this treatment as is explained in Climate 

Change; the Scientific Basis, the IPCC 2001 Report, chapter 8. 

Question 9. In looking at pre-industrial global temperature patterns, would you 

agree that changes in temperatures over time have occurred that had no anthropogenic basis? 

Answer. Temperature is a climate variable that has large natural variability over 

all time scales and space scales. The natural variability can arise because of external forcing such as changes in solar radiation or because of variations within the 

climate system itself. In addition to this natural variability, changes occur because 

of human activities, for instance deforestation, changes in vegetation or land use 

and since the industrial revolution because of changes in atmospheric composition 

especially most recently emissions into the atmosphere of growing quantities of 

greenhouse gases. 

The task of the IPCC has been to study thoroughly all reasons for climate variability and change both natural and anthropogenic and, through appropriate scientific analysis and the employment of climate models, to distinguish as far as possible between natural and anthropogenic effects. 

Question 10. Do we know what the ‘‘best’’ global temperature is to sustain life? 

Answer. Life of all kinds—human and non human—exists successfully on earth 

under a very wide variety of climates. What is important to realize is that humans 

and ecosystems have over millennia and centuries adapted to reasonably stable local 

climatic conditions. But unusually large climate changes are beginning to occur on 

a global scale and at a rate that is greater than for at least 10,000 years. If the 

local climate changes too rapidly, adaptation to new conditions may be difficult for 

both ecosystems and humans. The IPCC has concluded, ‘Projected climate change 

will have beneficial and adverse effects on both environmental and socio-economic 

systems, but the larger the changes and rate of change in climate, the more the adverse effects predominate’ (Climate Change 2001, Synthesis Report, 

Many ecosystems are sensitive to unusual and sustained changes in temperature 

or precipitation. I give two examples. First, many areas of tropical corals are suffering ‘bleaching’ because of increases in ocean temperature. Corals are also expected to be seriously affected by the increased ocean acidity that is occurring because of carbon dioxide from anthropogenic sources that is emitted into the atmosphere and then dissolved in ocean waters—an environmental problem that has only 

recently been appreciated. (see U.K. Royal Society Report 12/05, Ocean acidification 

due to increasing atmospheric carbon dioxide, 30 June 2005, available on 

<www.royalsoc.ac.uk>). A second example is of substantial die back that is occurring 

in forests at northern high latitudes because of increased warming outside their normal range of tolerance. 

Over past epochs humans have responded to severe local or regional climate 

changes by moving into other more tolerable areas. In our modern extremely crowded world large population movements are no longer possible. To some adverse 

changes, it will be possible for humans to adapt, although often at significant cost. 

For instance, adaptation to changes in average water availability, average temperatures or some sea level rise might be achieved through alterations to water resource 

infrastructure, building design or sea defences. For many low lying areas, however, 

such as large populated deltas or many islands, adaptation to sea level rise is not 

a practical possibility and many millions will be displaced. Further, the increases 

that are likely in the frequency and intensity of floods and droughts will cause large 

problems especially for populations in sub tropical countries that are particularly 

vulnerable to such events. 

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Question 11. What is currently being done to curb emissions from parts of the 

world in poverty who are deforesting their environment and burning biomass for all 

means of day-to-day living, and are these emissions continuing to increase in the 

world? 

Answer. 

ARE THESE EMISSIONS CONTINUING TO INCREASE

Deforestation releases CO2 to the atmosphere both from the vegetation directly 

and also by disturbing the soil. The numbers quoted below refer to this. Burning 

biomass as a day-to-day fuel leads to net CO2 emissions if the biomass is not replaced. If the biomass is grown explicitly for fuel wood then there are no net CO2

emissions as the carbon biomass stock on average remains constant. 

CO2 flux from land-use change is increasing at about the same rate as fossil fuel 

usage. On a global scale, in 1980 land-use change accounted for about 23% of total 

anthropogenic emissions and in 2000 about 24%. Regionally, there are some differences. From 1980 to 2000, land-use carbon fluxes increased by 30% in tropical 

America—close to the global average increase. Larger increases occurred in tropical 

Asia (56%) and tropical Africa (60%). 

(Data taken from: Houghton, R.A., and J.L. Hackler, 2002. Carbon Flux to the Atmosphere from Land-Use Changes; and Marland, G. et al., 2005, Global, Regional, 

and National CO2 Emissions—both in Trends: A Compendium of Data on Global 

Change, Carbon Dioxide Information Analysis Center, Oak Ridge National Laboratory, U.S. Department of Energy, Oak Ridge, Tenn., U.S.A. Both are available at: 

<http://cdiac.esd.ornl.gov/trends/trends.htm>.) 

WHAT IS CURRENTLY BEING DONE

My main personal experience of this problem comes through the Shell Foundation 

(a large charity set up by the Shell Company mainly to support sustainable energy 

provision in the third world) of which I am a Trustee. The Foundation has a large 

program aimed at the creation of local enterprises that build and market simple efficient stoves using traditional fuels that will substantially the reduce the amount of 

fuel that is used and also reduce indoor air pollution with the serious damage to 

health that it causes. The Foundation also has programs aimed at the creation of 

enterprises to provide sustainable and affordable energy to poor communities often 

from the use of readily available waste material (e.g. rice straw in China, coconut 

shells in the Philippines, etc.). The potential for the multiplication of such projects 

is very large. An aim of the Foundation is to join with other bodies and agencies 

to create mechanisms for the large scale-up of such programs so that they can become significant on a global scale both in the provision of energy to poor communities and also in reducing greenhouse gas emissions. 

Question 12. Do you believe it is practical to seek emission controls in parts of 

the world that are struggling in poverty? 

Answer. I believe the top priority is to achieve emissions reductions in the parts 

of the world that are making the largest emissions contributions i.e. the industrialized nations and those nations that are rapidly industrializing. Regarding nations 

‘struggling in poverty’, as you will see from my answer to Q11, I believe there is 

great opportunity for agencies and governments in the developed world to assist 

them to move out of poverty in ways that are sustainable and that reduce rather 

than increase their greenhouse gas emissions. 

Question 13. What is being done to curb emissions in the developing countries like 

China and India? 

Answer. In reply to Question 3 from Senator Bunning, I emphasized the importance of developed countries leading by example with regard to developing countries 

such as China and India. I also mentioned the responsibility on developed countries 

to develop partnerships with countries that are seeking to industrialize so as to assist them in whatever ways they can with the development of low carbon or carbon 

free energy generation. Further, it is essential that developing countries are full 

participants in agreements that need to be reached regarding targets and mechanisms in the next stage of negotiations that is taking place within the FCCC. 

RESPONSES OF SIR JOHN HOUGHTON TO QUESTIONS FROM SENATOR FEINSTEIN

Question 1. Is there any credible scenario for stabilizing greenhouse gas emissions 

that does not involve the United States and other major emitters stopping their 

emissions growth over the next couple of decades and sharply reversing their emissions growth by 2050. 

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Answer. All scenarios of global emissions that stabilize carbon dioxide concentrations in the atmosphere this century slow emissions growth over the next few decades and reverse that growth severely during the second half of the century. That 

applied to global emissions. The slowing and reversal of emissions for industrialized 

countries need to occur more quickly than for global emissions so as to allow room 

for growing industrialization in developing countries. I provide examples of stabilization profiles for both developed and developing countries in my written testimony to the committee. 

Question 2. Would the National Commission on Energy Policy’s proposal stop and 

then reverse U.S. greenhouse gas emissions? 

Answer. I am not an expert of energy policy and cannot comment in detail on the 

proposals of the National Commission on Energy Policy. As I understand it, their 

main proposals are limited to stopping the growth of emissions by 2020 and do not 

cover the period after that date, although they recognize in their report the need 

for the reversal of emissions growth after 2020. 

RESPONSES OF DR. MARIO MOLINA TO QUESTIONS FROM SENATOR BINGAMAN

Question 1. Over the last several decades, anthropogenic emissions have ‘‘substantially contributed’’ to the increase in average global temperatures. Upon receiving 

a question from one of the Senators, one of the panelists suggested that ‘‘80 percent’’ 

of the warming was due to human activities. Do all the panelists agree? Please provide information as to how this estimate was derived. 

Answer. Other panelists will need to answer for themselves as to whether they 

agree with the 80 percent figure. While I personally believe that estimate is probably in the right ballpark, I think it’s less important to focus on a particular number 

than it is to stress the broader scientific consensus reflected in recent findings of 

the Intergovernmental Panel on Climate Change (IPCC)—in particular the IPCC’s 

finding that ‘‘MOST of the warming of the past 50 years is attributable to human 

activities.’’

As for the techniques used to estimate the extent of human vs. natural influences 

on climate, estimates such as the one noted above are generally based on a careful 

statistical comparison of the temperature record over the past century against the 

timing and estimated magnitudes of the positive and negative ‘‘forcings’’ (warming 

and cooling influences respectively) known to have been produced in this period by 

both human and natural phenomena. Examples of such forcings include volcanic 

eruptions (which are thought to have had a slight overall cooling influence on surface air temperatures over the past 50 years), solar changes (which are not thought 

to have had a significant effect over this time period but may account for a slight 

amount of warming), emissions of sulfates and other aerosols (some of which would 

have had a cooling effect), and emissions of carbon dioxide, methane, and other 

greenhouse gases (which would have a strong warming effect). 

A crucial test of our confidence in the proposition that human activities are having a substantial impact on global climate is that when the best current climate 

models are supplied with the estimated time history of all known forcings—natural 

and human—as inputs, the temperature history for the 20th century calculated by 

the models matches the observed temperature record. If the ‘‘model’’ climate is driven only by the known natural forcings, the match with observations is poor; that 

is, the natural forcings cannot account, by themselves, for a large part of the 

changes in temperature that have been observed. 

Question 2. We received testimony that sought to distinguish between average 

global temperature changes causes primarily by anthropogenic emissions and local/

regional temperature changes caused at times by natural variation. Please explain 

in greater detail. 

Answer. The surface temperature of the Earth is never uniform. The average temperature that features in discussions of climate change represents an average over 

every place on Earth, including some places that are warmer than average and 

some that are cooler. (The average is also an average over time—over the 24 hours 

in each day and the 365 days in each year, if one is speaking, say, of the average 

temperature for 1850 or 2000 or 2005.) Changes in temperature are likewise not 

uniform spatially or temporally, and this is true whether the changes result from 

human or natural forces. 

For example, volcanic eruptions reduce the average temperature of the Earth for 

a time because the fine particles they inject into the stratosphere reflect sunlight 

back into space before it reaches Earth’s surface. The cooling they cause is not, however, spatially uniform because the particles are most concentrated in the latitude 

band where the eruption has occurred. (The winds that spread these particles 

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around blow mostly from west to east moving them quite rapidly along lines of constant latitude while spreading them only slowly to the north and south.) In addition, 

the cooling effect declines over time because the particles eventually settle back to 

Earth. 

Particles added to the atmosphere by human activities—including especially agricultural burning, fossil-fuel burning, and human-caused forest fires—also show the 

highest concentrations, and therefore the largest effects, in the latitudes where they 

are emitted. Some of these particles tend to cool the Earth below them, like those 

from volcanic eruptions, while others (such as black soot from incomplete combustion) tend to warm the Earth below. 

Unlike particles from volcanic eruptions, most of the greenhouse gases being 

added to the atmosphere by human activities stay there long enough to become uniformly mixed through the atmosphere around the globe. But still, the temperature 

changes that result from these greenhouse-gas increases are not uniform over the 

surface of the Earth, because the other forces that shape the surface temperature 

at any given place can act to either amplify or reduce the impact of altered greenhouse-gas concentrations on local temperatures. Such forces can include natural oscillations in the climate system, like the El Nin ̃ o-Southern Oscillation and the Pacific Decadal Oscillation, that can modify the global-scale response at a particular 

location for years or even decades, making the response to increased greenhouse gas 

concentrations larger or smaller. Notably, the global-scale warming influence of 

human-made greenhouse gases will not only be superimposed on top of all these 

natural cycles, but may also influence their behavior. At the local to regional scale, 

additional influences—such as air pollution, land cover change, and urbanization—

can also contribute to localized warming or cooling. 

Indeed, because of the complicated dynamics of changes in the circulation of the 

atmosphere and the oceans—changes that can be caused by the effects of greenhouse gases or by human and natural forces that are independent of greenhousegas increases—it is perfectly possible, and indeed is often predictable, that some regions will become cooler on average even as the Earth as a whole grows warmer 

on average. And, of course, some regions will warm faster than the world as a whole 

is warming, as for example is happening in the Arctic for reasons that are quite 

well understood. Based on global-scale ‘‘fingerprint’’ studies that compare complex 

patterns of temperature and other aspects of climate from observations and climate 

models, we generally expect warming to be greater over land areas than over the 

oceans (due to differences in heat capacity), greater at mid to high latitudes than 

at low latitudes (due to more energy going into evaporation in lower latitudes), and 

greater in the winter than in the summer (again due to more heat going into evaporation during the summer). These tendencies are based on long-term projections and 

may or may not apply in all regions or localities, especially in the early stages of 

warming. Nevertheless, it is clear that over the next century, the human-caused amplification of the greenhouse effect will exert a dominant influence on average temperatures at sub-continental to global scales. 

Question 3. Please explain the meaning of ‘scientific consensus’ and comment on 

the status of the science of climate change in the scientific and academic community. 

Answer. The validity of scientific propositions is not determined by popular vote 

or even by a vote among scientists. It is determined by the replicability of observations, experiments, and analyses and the demonstrated predictive value of theories 

based on these, as certified by peer review. Peer review takes place when papers 

submitted for publication in scientific journals are reviewed by ‘‘referees’’ chosen by 

the editor, as well as when other scientists critique and try to replicate published 

results and when bodies such as the National Academy of Sciences and the IPCC 

use committees of scientists to review the state of understanding on specific issues. 

At any given time, in any given scientific discipline, there is a set of understandings of the subject constituting what most competent specialists in the field 

consider to have been established. These understandings relate to what these specialists believe is known with high confidence, what they believe is probably true 

but not yet established with such high confidence, and what they believe the important questions are that need further investigation before conclusions can be drawn 

about them with any confidence at all. This set of understandings of a topic—the 

understandings held in common by most competent specialists in the relevant 

field—is what is meant by the term ‘‘scientific consensus’’. 

The term does not mean some sort of average or common understanding held by 

everybody who is a scientist of any kind. Science is divided into many disciplines 

and specialties, and specialists in one topic are not necessarily much better informed 

about the science of topics outside their specialties than are laypeople. (Indeed, an 

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entific topic will probably know more about it than a scientist from a different specialty who has not made such an effort.) Thus, one would not try to determine the 

‘‘scientific consensus’’ on climate change by polling a random sample of scientists of 

all specialties. One does it, as the U.S. National Academy of Sciences and the IPCC 

have done it, by convening a representative sample of the leading specialists to review and discuss current understandings and write down what they come up with 

in a report, which is then subjected to further review by additional leading specialists as to its accuracy and clarity. 

Like all science, the science of climate change is evolving—a process in which old 

understandings are strengthened, modified, or discarded; earlier questions are wholly or partly answered (or found to resist answers); and new questions emerge. Disagreement and controversy are a normal part of this process. Much of the attention 

of scientists tends to be focused on questions that are not yet settled, and it is the 

healthy habit of some fraction of the scientific community to be constantly challenging understandings that most others have accepted. Scientific reputations are 

made not only by answering questions that no one was able to answer before, but 

also by showing that some understanding that was previously commonly accepted 

is in fact not adequate and requires modification. 

The possibility of making their reputation by overturning accepted scientific wisdom motivates the ‘‘heretics’’ who are found in every scientific field. But policy makers and the public need to know that such reversals of accepted understandings are 

far rarer than popular accounts of science often suggest. In any given field at any 

given time, the odds are that most of the understandings held in common by most 

of the specialists in that field are right or close to right. The greater the body of 

accumulated evidence and analysis that supports those understandings, moreover, 

the lower is the chance of their being overturned. And even in the most celebrated 

scientific ‘‘revolutions’’, such as that produced by Einstein’s theory of special relativity, the ‘‘old’’ understandings often remain adequate for most purposes. (Special 

relativity notwithstanding, the old Newtonian mechanics remain perfectly adequate 

for predicting what will happen when you drive your car at 60 mph into a brick 

wall.) 

The ‘‘scientific consensus’’ on climate change—the understandings of climate 

science currently held in common by almost all scientists in this field—is based on 

a very large body of evidence and analysis from a wide range of relevant scientific 

disciplines and approaches, accumulated by thousands of researchers in universities, 

research centers, and field stations all around the world over a period of many decades. The robustness of the consensus view is based on:

• the sheer volume of evidence and analysis (which has expanded at a greatly increased rate over the past 15-20 years); 

• the consistency of the picture that results from different types of observations 

and different modes of analysis (direct measurements of greenhouse-gas concentrations and the temperature of the ground and atmosphere and oceans; inferences about earlier concentrations and temperatures from glaciers, tree rings, 

sediments, and the like; application of fundamental principles of atmospheric 

physics; and computer simulations of past and future climatic change); and 

• an intensity and rigor of peer review unusual even by the ordinary standards 

of science, resulting from the obvious importance to society of getting this particular science right and manifested in the extraordinary number and depth of 

multiply peer-reviewed reports on the science of climate change by the U.S. National Academy of Sciences, the IPCC, and a number of other national and 

international scientific bodies.

The scientific consensus view on climate change will continue to evolve as measurements and analyses continue. It is highly unlikely, however, that this evolution 

will change the current core understandings—namely that the Earth’s climate has 

recently been changing in a manner that is unusual against the backdrop of normal 

variation from natural causes, that increased atmospheric greenhouse-gas concentrations from human activities are playing a large role in these changes, and 

that continuation along the current path will lead to additional climatic changes 

that are, on balance, increasingly harmful to industrialized and developing countries 

alike—in any fundamental way. The evolving understandings will, instead, provide 

more detailed and reliable information than currently available on the character, geographic distribution, and timing of future climatic changes and on the impacts of 

these changes. It is important for policy makers to recognize that this more detailed 

and reliable picture is at least as likely to be more alarming than the current scientific consensus, as described by the National Academy of Sciences and the IPCC, 

as it is to be less alarming than these current portrayals. 

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Question 4. What is ‘‘abrupt climate change?’’ Can you identify any potential 

thresholds that might be crossed if insufficient action is taken to control CO2 emissions? For example, I have heard that beyond certain temperature increases, large 

ice sheets could collapse, leading to huge increases in sea level. Can you comment 

on this and other potential thresholds? 

Answer. Improved methods for reconstructing the past climate of the Earth from 

‘‘paleoclimatological’’ evidence such as the composition of gas bubbles trapped in the 

Greenland and Antarctic ice sheets have made plain that the climate has sometimes 

changed more abruptly in the past than had previously been supposed—for example, 

making a transition from an interglacial to a glacial period, or the reverse, in a matter of one to a few decades, rather than centuries. The fact that such rapid changes 

in outcome have been possible under gradually changing, natural ‘‘forcings’’ of 

Earth’s climate is anything but reassuring in the context of the relatively rapid 

changes in ‘‘forcing’’ being generated by human-caused greenhouse gases today. If 

climate changes abruptly rather than gradually, the possibilities for adaptation by 

means of altered agricultural practices and patterns, construction of dams and 

dikes, and so on become much less promising. 

To understand the possibility of abrupt or ‘‘non-linear’’ climate change it may be 

helpful to think about a light switch. If you first apply only a little bit of force to 

the switch, it doesn’t move and no light comes on. But if you progressively add more 

pressure, you will eventually ‘‘flip the switch’’ and the light will come on. The light 

produced is not proportional to the pressure applied; that is, you don’t get a little 

bit of light as you add a little bit more pressure. The light turns on once you push 

hard enough to move the switch. Similarly, the Earth’s climate system is likely to 

contain thresholds that could conceivably initiate or accelerate abrupt climate 

change once the ‘‘forcing’’ caused by increased atmospheric concentrations of greenhouse gases reaches a certain level. One example of such a threshold might involve 

sudden shifts in the thermohaline pattern of ocean circulation. As warming temperatures melt the ice at the poles, salty ocean waters will be diluted with freshwater. Paleoclimatic records suggest that it is possible this gradual freshening of the 

sea, if it reached a certain level, could ‘‘flip a switch’’ and greatly diminish or even 

shut down deep ocean currents that are important in transporting heat and nutrients from the equator to the poles via global ocean circulation patterns. The result 

could be significant changes in regional weather patterns. 

Crossing certain temperature thresholds could also trigger the initiation of rapid 

and irreversible melting of the Greenland Ice Sheet or a sudden destabilization of 

the West Antarctic Ice Sheet, either of which would raise global sea levels by about 

20 feet. Another possibility is that temperatures could increase enough to trigger 

large-scale decomposition of methane clathrates (with attendant large amplification 

of the greenhouse effect). Unfortunately, knowledge of these possibilities is not yet 

sufficient to enable confident prediction of whether and when they would materialize along the warming trajectory now being traveled. Knowledge of these possibilities is, however, sufficient to conclude that we would be wise to slow the rate 

at which we are adding pressure to the switch—in this case, by pushing up atmospheric concentrations of heat trapping gases. 

To underscore this point, another analogy may be helpful. We can think of ourselves as being on a CO2 ‘‘highway’’ that is taking us to a rapidly warming future. 

By adopting more or less aggressive measures to curb emissions we can exit this 

highway at various places and thereby stabilize atmospheric concentrations of heattrapping gases at various levels. At the moment, however, we are whizzing past 

exits, and with each one that goes by the risk grows that we may be passing a 

threshold. For example, as rising CO2 concentrations both increase global temperatures and acidify the oceans, coral reefs may already be destined for large-scale devastation. We may have already passed that point of no return, but we can’t be sure 

since we don’t know exactly which exits mark different thresholds for drastically 

changing the way our planet operates. 

The problem is that we are not likely to know that we have missed an exit or 

crossed such a threshold until it is too late to alter the outcome. Because CO2 remains in the atmosphere for centuries, we can’t wait and then make quick corrections once we see the results. Meanwhile, the faster we travel the more difficult it 

becomes to safely turn off the highway at any given exit. Thus, slowing our current 

emissions trajectory may be our best hope for anticipating and ultimately avoiding 

really abrupt and potentially catastrophic climate changes. By doing so, we can buy 

time to further develop our understanding of Earth’s climate systems and to develop 

the new energy technologies that will be needed to stabilize future atmospheric 

greenhouse gas concentrations. 

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Question 5. Can you tell us something about the time horizon for stabilizing climate, given how long carbon dioxide remains in the atmosphere? Do we need to 

begin to control emissions now or can we wait? 

Answer. Human additions of CO2 to the atmosphere produce long-lasting increases in the total quantity of CO2 in the atmosphere—which boosts the greenhouse effect because, while some portion of any additional carbon is quickly removed 

through uptake by plants and by the surface layer of the oceans, much of the carbon 

remains for decades and some of it remains for centuries. Every increase in the CO2

content of the atmosphere, moreover, initiates changes in the climate that themselves grow for decades (due to the inertia of the climate system). The consequences 

of a given increase in temperature, moreover, may continue to build for centuries 

after the increase occurs. (This is the case for the rise in sea-level is likely to result 

from continued warming, for example.) 

Thus, even though some effects are immediate, the full effects of any human additions of CO2 and other greenhouse gases to the atmosphere will not be felt for decades and centuries after the additions occur. Prudence therefore requires controlling 

emissions long before the climate-change impacts being experienced have become intolerable. Given that harmful effects of greenhouse-gas-induced climate change are 

already being experienced at a global-average temperature increase of around 0.8 

degrees C (1.4 degrees F) above the pre-industrial level, and given that the full effect of current greenhouse-gas concentrations will be a further increase of about 0.6 

degrees C (1.1 degrees F) by the time the ocean reaches equilibrium with the increased greenhouse effect that these concentrations entail, we would be foolish not 

to start controlling the offending omissions immediately. 

Question 6. Given that there is still some uncertainty about the details of future 

warming, how should such uncertainty be dealt with in designing policy responses? 

Let me begin my answer by once again suggesting an analogy. If you go to your 

doctor and he says that if you continue on your present course, you are at very high 

risk of having a heart attack, what do you do? Do you ask exactly what day the 

heart attack will come and how severe it will be? Or do you take action right away 

to diminish your risk and try to prevent an attack? 

Similarly, based on what we know now about the risks associated with rising 

greenhouse gas concentrations in the atmosphere, there is a clear need to begin reducing emissions right away if we are to improve our odds of avoiding the potentially severe and dangerous types of consequences that lie ahead. We know that the 

risk of ‘‘dangerous anthropogenic interference’’ in the Earth’s climate is going to continue to grow until we address it. Economists have analyzed the costs of various policy responses and they tell us that there are more and less cost-effective ways to 

go about managing this risk. The most cost-effective emissions trajectories involve 

starting now to control emissions, just as it is best to initiate one’s retirement savings early and benefit from the compounding of interest over time. Delay will be 

costly, and is likely to require an even greater allocation of resources in the long 

run. Doing less (or nothing) to control emissions now makes it more likely that we 

will have to do more later—and do it more abruptly. As the joint statement of the 

national academies pointed out, this is likely to be more expensive because it is difficult for economies to adjust to abrupt policy changes. It is thus not only more prudent, but more economically efficient to begin taking action now—preferably by implementing a policy that sends a clear signal to the market about the cost of emissions. A well-designed policy to accomplish this can also provide important ancillary 

benefits by promoting efficiency, reducing oil imports, improving air quality, and 

giving U.S. companies a competitive edge in the development and deployment of 

new energy technologies. 

Question 7. How do we know that emissions of carbon dioxide and other greenhouse gases are causing Earth’s temperature to rise, as opposed to other factors that 

we have no control over; such as sun spots? Some assert that an increase in solar 

irradiance is the main cause of the Earth’s current warming trend. Therefore, reducing fossil fuel emissions would not impact the Earth’s temperature. 

Answer. The sun’s radiant output is one of many factors that affect the Earth’s 

climate. Scientists have intensively studied these various factors and how much 

they have influenced climate over the past century. ‘‘Fingerprint’’ studies analyze 

patterns of temperature change in models and in observations to help understand 

the causes of climate change. For example, were recent warming trends being 

caused by an increase in solar irradiance, one would expect the stratosphere to be 

warming also. This is not the case—in fact, the stratosphere is cooling. Similarly, 

if sunspots are the main cause of warming, then warming trends should correlate 

with sunspot activity. Again, this is not the case. Instead, global average surface 

temperatures have continued to rise with rising atmospheric concentrations of 

greenhouse gases. According to the IPCC, the warming effect due to increased 

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1See, for example, Peterson, T.C., K.P. Gallo, J. Lawrimore, T.W. Owen, A. Huang, and D.A. 

McKittrick, 1999: Global rural temperature trends. Geophys. Res. Letts., 26, 329-332 and Peterson, Thomas C., 2003: Assessment of urban versus rural in situ surface temperatures in the contiguous U.S.: No difference found. J. Climate, 18, 2941-2959. 2Parker, D.E., 2004: Large-scale warming is not urban, Nature, 432, 290-291, 10.1038/

432290b. 3See, for example, Mears, C.A., M.C. Schabel, and F.J. Wentz, 2003: A Reanalysis of the MSU 

channel 2 tropospheric temperature record. J. Climate, 16, 3650-3664; Vinnikov, K.Y., and N.C. 

Grody, 2003: Global warming trend of mean tropospheric temperature observed by satellites. 

Science, 302, 269-272; Vinnikov, K.Y., A. Robock, N.C. Grody, and A. Basist, 2004: Analysis of 

diurnal and seasonal cycles and trends in climatic records with arbitrary observation times. 

Geophys. Res. Lett., 31, L06205, doi:10.1029/2003GL019196, 2004; Lanzante, J.R., S.A. Klein, 

and D.J. Seidel, 2003: Temporal homogenization of monthly radiosonde temperature data. Part 

Continued

greenhouse gas concentrations in the atmosphere over the past century is estimated 

to be more than eight times greater than the effect of changes in solar irradiance. 

In fact, observations do not even show an increase in average solar output over the 

past 50 years. Numerous peer-reviewed studies have concluded that natural factors, 

including solar output, could not have caused the observed warming of the past half 

century. 

Question 8a. There are some who question the veracity of the assertion that the 

earth has warmed substantially over the last century. Arguments typically fall into 

three categories. It would be useful if you would address each in turn: 

Urban Heat Island Effect. This is the claim that the underlying temperature data 

is tainted by the proximity of data-generating thermometers to cities. As urban 

areas have grown over the last fifty years, the air temperatures around these cities 

have increased due to larger amounts of heat generating substances like rooftops 

and roadways. Scientists claim to have corrected for the urban heat island effect. 

How was this done, and how can we be sure that it was done correctly? 

Answer. The ‘‘urban heat island effect’’ is a spatially nonuniform warming effect 

from human activities that some climate-change skeptics have claimed has distorted 

the temperature record of the last 100 years so as to cause an overestimate of the 

effects of greenhouse gases. Some (including the author Michael Crichton in his recent novel) have claimed that much or all of the entire observed global warming is 

an artifact resulting from many of the measurement stations being in cities, which 

are warmer than the surrounding countryside because of the heat released in the 

operation of vehicles, factories, and homes. While a few disreputable skeptics continue to claim this, the fact is that their hypothesis has been completely discredited 

by much-replicated studies that carefully correct the analysis of temperatures from 

the global thermometer network for the effects of urban heat release. 

To correct for the urban heat island effect, for example, scientists have compared 

temperature measurements taken in rural vs. urban areas and in some cases have 

simply excluded measurements taken at urban sites. Meanwhile, studies that compare global time series made up of temperature measurements taken only at rural 

stations with time series that also include temperature data from urban stations 

have found no difference between the two, suggesting that there is no bias in the 

global temperature trend due to urbanization1 In another recent study using different methods, Parker (2004) also found no effect from urban warming in the global 

average temperature record.2

Finally, it is worth noting that thermometer readings are not the only evidence 

of warming. Glaciers on every continent, none of which are located in urban environments, are retreating. Rising sea levels, increasing ocean temperatures, thawing 

permafrost, and movement of animal and plant species all provide additional evidence of a global warming trend that cannot be explained by the urban heat island 

effect. 

Question 8b. Satellite and Airborne Balloon Data Contradict Surface Temperature 

Readings. Global mean temperature at the earth’s surface is estimated to have risen 

by about half a degree F over the last two decades. On the other hand, satellite 

measurements of radiances and airborne balloon observations indicate that the temperature of the lower to mid-troposphere (the atmospheric layer extending from the 

earth’s surface up to about 8 km) has exhibited almost no change during this period. 

Please explain whether this discrepancy is, indeed, real and how to account for it. 

Answer. Recent peer-reviewed studies have shown that the low-and mid-troposphere have in fact warmed at about the same rate as the Earth’s surface over the 

past few decades. The earlier notion that the troposphere had not warmed was 

based on significant errors in the adjustment of satellite and balloon data. As these 

errors have been corrected, the temperature data for the low-and mid-troposphere 

have consistently shown more warming.3 Studies to be published this month (11 AuVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00179 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
176

I: Methodology. J. Climate, 16, 224-240 and Lanzante, J.R., S.A. Klein, and D.J. Seidel, 2003: 

Temporal homogenization of monthly radiosonde temperature data. Part II: Trends, sensitivities, and MSU comparison. J. Climate, 16, 241-262. 4Sherwood, S.C., J.R. Lanzante, C. Meyer, Science, 11 August 2005: Radiosonde daytime biases and late 20th Century warming. (10.1126/science. 1115640) and Mears, C.A., and F.J. 

Wentz, Science, 11 Aug. 2005: The effect of diurnal correction on satellite-derived lower tropospheric temperature. 5 A thorough analysis of the hockey stick debate can be found at www.realclimate.org. 

gust 2005) in Science expose the latest of these errors (see Sherwood et al., 2005 

for balloon data; and Mears and Wentz, 2005 for satellite data).4 In addition, the 

rate of warming both at the surface and in the troposphere has increased in the 

years since initial analyses of satellite and radiosonde data were undertaken. 

Though there are still minor discrepancies between available data sets due to the 

different methods that different research teams use to analyze the data, the bottom 

line is that both the surface and the troposphere show significant global warming 

trends according to all available data records: those derived from thermometers at 

the surface, those derived from sensors on satellites, and those obtained from weather balloons. These records show no major difference between surface and tropospheric warming at the global scale over the past several decades. 

Question 8c. The Hockey Stick. In recent months, there have been assertions that 

the statistical method used to analyze global temperature data for the last several 

hundred years was biased towards generating the ‘‘hockey stick’’ shaped curve that 

shows sustained low and stable temperatures for hundreds of years with an extremely sharp rise in the last 100 years. Can you comment on whether the observations depicted in the hockey stick curve are, indeed, legitimate? 

Answer. The ‘‘hockey stick’’ shape of reconstructions of Earth’s temperature over 

the past 1,000 years, which shows a sharp rise in temperature over the last 100 

years, is a feature that is found in, or supported by, many different lines of measurement and analysis by many different investigators. It appears, for example, in 

studies of the extent of glaciation in mountain regions, gas bubbles trapped in the 

Greenland and Antarctic ice sheets, tree rings, pollens preserved in sediments, and 

borehole measurements of temperatures at various depths in Earth’s crust. The critiques that have been offered of the statistical techniques that were used to produce 

one particular version of the ‘‘hockey stick’’ graph—a version that was prominently 

displayed in the 2001 climate-science report of the IPCC—would not invalidate this 

general conclusion even if the critiques were correct. But it now seems quite clear, 

both from the responses offered by the authors of that graph and from analyses that 

are becoming available from others, that these critiques are wrong. 

In addition, it should be stressed that the details of the shape of the 1000-year 

‘‘hockey stick’’ are not an essential element of the key understandings in the current 

scientific consensus about climate change—namely, that the planet is now warming 

at an unusual rate and that this current warming is primarily due to human activities. A very large number of independent studies have led to this conclusion.5

Question 9. Some say that global warming might be a positive development? Will 

agricultural crop productivity improve due to the greater amount of CO2 in the atmosphere, and can we expect the Arctic and Antarctic regions to become more habitable? 

Answer. The effects of climate change on agricultural productivity depend on numerous inter-related factors, including rising temperatures, increased CO2 in the atmosphere, average precipitation levels, incidence and severity of floods and 

droughts, and the plant-pest-and-pathogen-promoting effects of a warmer, wetter 

world. Early studies that ignore the pest-and-pathogen and flood-drought issues 

have suggested that a modest increase in global-average temperatures would increase agricultural productivity in some areas, while reducing it in others. Even 

these limited predicted benefits are confined to small increases in temperature, however, with overwhelmingly negative effects setting in when temperatures reach levels expected in many agricultural regions by the middle of this century. More recent 

studies that account for a fuller range of climate-linked effects on crops suggest that 

net negative impacts on world agriculture are likely even sooner. 

Modest amounts of global-average warming will have both positive and negative 

impacts on other aspects of human health and well-being as well. In some mid-latitude regions, for example, slightly warmer winter conditions might have some positive consequences (e.g., lower heating bills) as well as some negative ones (e.g., diminished mountain snowpack could further strain already inadequate water supplies in western parts of the United States). But in these non-agricultural respects, 

too, the net impacts are likely to turn strongly negative for most nations, people, 

and biological systems above a certain threshold—both because the rate of climatic 

177

change is likely to require continual adjustment and because negative impacts will 

begin to overtake positive ones. 

The recent Arctic Climate Impact Assessment presented evidence that strong negative impacts are already affecting the Arctic and that these negative impacts are 

likely to intensify as warming proceeds. Impacts that are already being registered 

include severe coastal erosion due to retreating sea ice, rising sea level, and thawing 

of coastal permafrost and attendant damage to buildings, roads, and industry. More 

severe insect outbreaks and more frequent forest fires are also likely to accompany 

ongoing warming. The warmest regions of the world, meanwhile, may begin to experience conditions that are virtually unprecedented for human societies and natural 

ecosystems. In sum, the evidence is strong that negative impacts are very likely to 

outweigh positive ones as rapid warming proceeds. 

Question 10. It is my understanding that the assessments of the progression of 

global warming through the next century and its impacts on changing the Earth’s 

climate are largely based on computer modeling. It goes without saying that the 

planet’s atmospheric, hydrologic, and meteorological systems are highly complicated. 

What can you say about how climate modeling capabilities have advanced since scientists began evaluating the problem? What is the level confidence that the computer models are providing useful projections of the future climate? 

Answer. You are correct that we gain most of our insight into what the future 

holds by utilizing complex, physically-based computer models. These models are 

quantitative and grounded in the fundamental laws of physics and chemistry and 

are anchored by a very large number of scientific measurements. Our confidence in 

the models is strengthened by the fact that they can replicate past and present climates as well as the influences of the most important factors that affect climate. 

The models are extensively compared, tested, and refined, and they provide us with 

valuable insights. Climate scientists do not use the models blindly, they analyze and 

understand them and check them against everything else that they have learned. 

That said, models are not the only tools scientists use to predict what will happen 

as greenhouse gas concentrations continue to rise. Records of past climatic conditions derived from ice cores, tree rings, and other data, and observations from the 

past century also provide evidence regarding how climate changes and what the impacts of such changes are likely to be. There is no past analog to the geophysical 

experiment that our species is now undertaking—and is committed to for some time 

into the future. Although models may provide only an indication of what is most 

likely to occur, they are among the most important tools we have for anticipating 

the consequences of a changing atmosphere rather than simply facing those consequences without warning. 

Question 11. You played a central role as a scientist in the debate surrounding 

the stratospheric ozone hole, which led to a resolution that is widely regarded as 

one of the most important and successful international environmental agreements 

ever. Do you see any key similarities between the two issues (stratospheric ozone 

layer and climate change) and, more importantly, can you comment on any key lessons that might be applicable to the current debate on whether and how to address 

climate change? 

Answer. Ozone is a highly reactive, unstable molecule consisting of three atoms 

of oxygen. It occurs both near the Earth’s surface—where it is a major constituent 

of smog, and in the region of the upper atmosphere, six to thirty miles above the 

surface. Paradoxically, while surface ozone is harmful to human health and the environment, the ‘‘other’’ ozone—that in the stratosphere—is absolutely necessary for 

life. 

Research has been key to understanding how stratospheric ozone blankets the 

Earth and helps make it a livable planet. Stratospheric ozone forms an invisible 

shield protecting us from the hazardous ultraviolet radiation that streams towards 

the Earth continuously from the sun. UV-B radiation can directly harm people. For 

every 1% increase in UV-B radiation, there will be about a 2% increase in non-melanoma skin cancer in light-skinned people. We currently have about 750,000 new 

cases of skin cancer each year in the United States, of which between 0.5% and 1% 

will result in death. Increased exposure to UV-B radiation can also cause cataracts, 

which are already the third leading cause of blindness in the United States. Increased UV-B radiation is also associated with decreased immune system response 

in all populations. 

The story of how we reached these international agreements began twenty years 

ago when Sherwood Rowland and I hypothesized that chlorofluorocarbon molecules 

(CFCs) are stable enough to diffuse to the stratosphere where the sun’s ultraviolet 

radiation would split off the chlorine atom, whereupon each chlorine atom would act 

as a catalyst, destroying thousands of molecules of ozone. 

178

Back then there was little but laboratory data and numerical models to support 

the hypothesis. In fact, all we really knew was that CFC concentrations in the atmosphere had been rising and that a seemingly plausible, but unproven, hypothesis 

existed that chlorine from CFCs could destroy ozone. 

CFCs were invented in the early 1930s as a replacement for hazardous compounds like ammonia that were then widely used as refrigerants. CFCs are odorless, 

extremely stable, relatively non-toxic, and nonflammable. Not surprisingly their use 

quickly spread to a wide range of industrial and consumer applications, from refrigeration to aerosols propellants to foam products and eventually as solvents in the 

electronics industry. 

Given the scientific consensus that now exists, it is hard to imagine the controversy that surrounded this theory two or three short decades ago. In part, this 

controversy was driven by the lack of clear and convincing evidence in support of 

the hypothesis, but it was also driven by a concern that CFCs were critical to our 

quality of life and no substitutes existed to replace them. 

How then did we quickly evolve from a politically charged situation in the late 

1970s to today where 150 nations of the world have agreed to phase-out CFCs by 

the end of this year in all developed countries and soon thereafter in developing 

countries? 

First and foremost, this issue has been driven by major and definitive advances 

in our scientific understanding. We have gone well beyond our rudimentary knowledge in 1974 of the impact of CFCs on ozone chemistry. While uncertainties remain, 

laboratory and field experiments, observations, and more extensive model simulations have enabled us to become much more confident about the atmospheric processes that control stratospheric ozone and the role that CFCs and other chlorinated 

and brominated compounds have on those processes. 

The most striking example of our new understanding concerns the so-called Antarctic ozone hole. When ground-based and satellite data were first published showing the existence of this ozone hole, which opens in the Antarctic spring, the scientific community, not to mention the public at large, were taken completely by surprise. No models or theories had predicted any such phenomenon. At first, the scientific community was at a loss as to explain its cause. Was it due to CFCs, the 

result of some meteorological conditions, or was some other unknown factor at 

work? Was the condition unique to Antarctica, to polar conditions in general, or likely to affect global ozone levels? 

These were more than interesting questions for the scientific community to debate. Just about the same time news about the ozone hole surfaced in the scientific 

literature, nations were coming together to discuss what actions they should take 

to protect the ozone layer. But a definitive policy decision was dependent on a sound 

scientific understanding of the issue. 

In what must be considered record time and with broad international and public 

and private sector cooperation, two major scientific campaigns were organized in 

1987 and again in 1988 to collect data concerning the Antarctic ozone hole. Based 

on extensive field measurements, lab experiments and modeling, the consensus view 

emerged that CFCs cause the depletion of ozone over Antarctica. 

This finding brought a sense of urgency to policy makers. As we all know, ozone 

is a global issue and requires a global response. Reductions in the use of CFCs in 

the United States—even though the United States was the major source of CFCs—

were not going to solve the problem if other nations continued to expand their own 

use. Subsequently, a series of international scientific studies were conducted. These 

reviews began in the 1970s and were formally brought into the Montreal Protocol 

when it was signed in 1987. They have become the bedrock foundation upon which 

policy decisions concerning ozone depletion are taken. 

The original Montreal Protocol called for a 50% reduction in CFCs by 1998, but 

also called for periodic review of scientific and technology issues. The first such review was issued in 1989 and led the Parties to agree, first, that—on the basis of 

new scientific information—even greater reductions were needed to protect the 

ozone layer and second, that chemical substitutes had advanced enough to make 

practical the full phase-out of CFCs by the end of the century. It is important to 

emphasize that extraordinary technological progress by the industrial sector in developing CFC alternatives permitted a faster phase-down. A similar process in 1992 

led to agreement that CFCs would be phased out in the developed world by the end 

of this year. 

Let me summarize the evidence that is now very clear and broadly accepted by 

experts around the planet:

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1. There is no doubt that the major source of stratospheric chlorine and bromine is from human activities (e.g., CFCs and halons), not from natural sources 

such as volcanoes or sea spray. 

2. There is no doubt that downward trends of stratospheric ozone occurred at 

all latitudes, except the tropics, during all seasons. The overwhelming weight 

of scientific evidence suggests that the observed mid-latitude downward trends 

of ozone were due primarily to anthropogenic chlorine and bromine. 

3. There is no doubt based on combining ground, aircraft, balloon and satellite 

data, with laboratory data and theoretical modeling—that the spring-time Antarctic ozone hole is due to anthropogenic chlorine and bromine. 

4. During periods of declining ozone, stations in Antarctica, Australia and 

mountainous regions in Europe, have shown that ground-level UV-B radiation 

increases, as is expected to occur with reduced ozone concentrations. 

5. The rate of increase of atmospheric chlorine and bromine in the atmosphere has slowed considerably in the last few years, demonstrating the effectiveness of actions taken under the Montreal Protocol and its amendments. 

Even so, and if everything goes forward smoothly, the mid-latitude ozone loss 

and the hole over Antarctica are not expected to disappear until the middle of 

the 21st century.

LESSONS LEARNED FROM THE MONTREAL PROTOCOL

The story I have told about the ozone layer shows science, technology, and policy 

moving forward in harmony. Four factors are important in understanding the 

sources of the Montreal Protocol:

1. Evolving scientific understanding of the problem did not hamper development and implementation of mandatory policies, 

2. Once mandatory policies were in place, the rate of technological progress 

exceeded our most optimistic expectations, 

3. The United States and other industrialized nations were willing to take a 

leadership role and move ahead of developing nations, and 

4. The availability of acceptable substitutes for CFCs was an important ingredient in garnering widespread political support, particularly from the business 

community.

In my opinion, these same factors are necessary for progress to address global climate change effectively. 

RESPONSES OF DR. MARIO MOLINA TO QUESTIONS FROM SENATOR BUNNING

Question 1. Would you say that the steps America has taken in the recent years 

to improve energy efficiency and produce lower carbon emissions from power generation are the right first steps in addressing climate change? Within that construct, 

given the current U.S. electricity supply that is more than 50% derived from coal, 

is encouraging clean coal technology, IGCC and carbon sequestration the most important immediate policy action we can take? 

Answer. Coal is obviously an extremely important part of our current energy mix 

and plays an especially significant role in the generation of electricity. It is also a 

relatively low-cost fuel and one that the United States possesses in abundance. For 

these reasons, all NCEP members agreed that it was critical to advance technologies—like IGCC with carbon sequestration—that will allow coal to continue to 

play an important role in meeting the nation’s and the world’s energy needs over 

the long run. As we put it in our report: ‘‘cost-effective technologies that would allow 

for continued utilization of coal with substantially lower greenhouse gas emissions 

could represent a significant breakthrough—one that would make policy responses 

to the risk of climate change compatible with a new era of expansion for the coal 

industry.’’ Because such technologies would advance a variety of economic, environmental, and energy security objectives, NCEP strongly agrees that developing clean 

coal IGCC technology and carbon sequestration is an important near-term policy 

priority. Accordingly, our report recommends substantially increased federal funding 

for research, development, demonstration and early deployment initiatives in this 

area. The funding levels we recommended are explicitly designed to support the 

early deployment of roughly 10 gigawatts (GW) of commercial-scale IGCC power 

plant capacity, together with additional projects to demonstrate carbon sequestration at a variety of sites around the country. 

While NCEP agrees that promoting coal IGCC with carbon sequestration is a critical policy priority, we also believe it cannot be our only policy priority if we are 

serious about addressing climate change. There are at least two reasons why technology incentives, by themselves, do not constitute an adequate response to the 

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threat of climate change. First, in order for new technologies to succeed it is always 

more effective, and indeed often necessary, to pair a policy ‘‘push’’—in this case public support for RD&D—with a ‘‘pull’’ from the marketplace. To create a market pull 

for coal IGCC and other climate-friendly technologies, markets need to put a value 

on avoided carbon emissions, so that utilities have clear incentives to pursue nonand low carbon alternatives and so that investors can justify putting money into 

new and less proven technologies. 

The second point is that no one technology, by itself, can ‘‘solve’’ the climate problem. On the contrary, most experts believe that we will need a portfolio of solutions 

that includes not only coal IGCC with sequestration but a variety of other options 

such as increased energy end-use efficiency, new nuclear technology, more natural 

gas technologies, and renewable energy options like wind and solar power. The importance of promoting a broad array of solutions rather than putting all our eggs 

in one technology ‘‘basket’’ again points to the need for a comprehensive policy 

framework that can create consistent incentives throughout the economy for avoiding carbon emissions. A mandatory, market based emissions trading program such 

as we have proposed for limiting carbon emissions is necessary to create those consistent incentives and is the critical complement to all other policies aimed at advancing a particular technology solution, be it coal IGCC or another low-carbon alternative. 

To sum up, all the efforts that have already been made to improve efficiency in 

the electric sector and to reduce carbon emissions from electricity generation are important and have helped to keep atmospheric concentrations of carbon dioxide lower 

than they otherwise would be. For all the reasons I have described above, however, 

these early efforts must now be followed by the crucial next step of implementing 

an overarching, mandatory policy for gradually limiting greenhouse gas emissions 

in the future. My NCEP colleagues and I believe that, over time, such a policy will 

not only prove most effective at promoting new technologies like coal IGCC with carbon sequestration, but will also prove the least costly approach for addressing the 

risks posed by future climate change. 

Question 2. As a member of the NCEP, you described the NCEP findings as a scientific analysis of why ‘‘business as usual’’ can not continue. Given the major government initiatives, most notably the Energy Bill we wrote in this committee, 

wouldn’t you agree that America is no longer operating ‘‘business as usual’’? 

Answer. The recently passed energy bill contains a number of provisions that I 

and other members of the NCEP strongly support, including new incentives for a 

variety of technologies that will help make our nation more energy secure while also 

reducing our greenhouse gas emissions. By themselves, however, these measures 

are unlikely either to significantly alter our future greenhouse gas emissions trajectory or to maximize the results achieved through additional government expenditures on new technologies. In a competitive market-economy, where companies are 

encouraged and in some cases obligated to maximize shareholder value, it is contrary to the rules of free-market competition to expect companies to invest scarce 

resources absent a profit motive. While there are numerous cases where a combination of good will, good public relations, and positive ulterior motives (like reduced 

energy bills), create an adequate basis for taking action, these cases will remain limited if the financial value of reducing a ton of greenhouse gas emissions remains 

zero. 

Unfortunately, the energy bill—notwithstanding the progress it makes in other 

important areas—does not provide that clear market signal. It does not directly address climate, nor does it seek to limit future greenhouse gas emissions. So in that 

sense, I would argue we are still operating in a ‘‘business as usual’’ framework with 

regard to climate change. 

Question 3. While you have presented what appears to be a united scientific front 

in the form of the statement from the academies of science from 11 countries, I am 

concerned by some of the news since the release of that statement. The Russian 

Academy of Sciences says it was misrepresented and that Russian scientists actually believe that the Kyoto Protocol was scientifically ungrounded. I am also aware 

that there was a significant misrepresentation on the science between our academy 

and the British representative. Given this background, wouldn’t you say there are 

still some pretty fundamental disagreements about the science of climate change 

among scientists around the world? 

Answer. I am not aware of the specific controversy or controversies to which this 

question refers and would defer to my fellow witnesses, notably Ralph Cicerone, for 

their view of the matter if in fact any such disagreements exist. I will, however, say 

that while I was not involved in drafting the national academies’ joint statement 

on global warming, I fully endorse it and believe that it accurately reflects the considered, consensus view of the great majority of climate scientists around the world. 

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6Stott, Peter, D.A. Stone, M.R. Allen, Nature, 2 December 2004, Vol. 432, Human contribution 

to the heatwave of 2003. 

While scientists will always continue to debate details (because that is the primary 

way in which science advances), it is clear to me that mainstream scientists around 

the world are in fundamental agreement about the science of climate change. 

Question 4. In this international academies statement, you find that an ‘‘immediate response that will, at a reasonable cost, prevent dangerous anthropogenic interference with the climate system,’’ but continue to say in the following paragraph, 

‘‘minimizing the amount of this carbon dioxide reaching the atmosphere presents a 

huge challenge.’’ Could you please elaborate, since any response can’t both be a ‘‘reasonable cost’’ and a ‘‘huge challenge’’ proposition, how you resolve the two? 

Answer. As I noted in my previous response, I wasn’t personally involved in drafting the academies’ statement. Nevertheless, I believe its thrust is quite clear and 

that it is not, in fact, difficult to reconcile the two specific sentences juxtaposed in 

this question. Simply put, it is often the case that the best and most practical solution to a very big problem lies in approaching it with relatively small steps. It may 

be helpful to return to the analogy of the heart patient I introduced in response to 

Senator Bingaman’s Question #6. If the patient does nothing now, but later requires 

emergency surgery or even an artificial heart, managing his condition will be expensive and risky and may require major advances in medical science. But the same 

patient can take early steps to reduce his risk of heart attack—such as changing 

his diet and exercising more—that are relatively easy and low cost. Of course, he 

may eventually still require more drastic treatment. But, at a minimum he can buy 

some time and significantly increase his odds of a healthy outcome over the long 

run. 

I believe the national academies were trying to make a very similar point. Fundamentally altering our energy systems so that global greenhouse gas emissions not 

only stop owing but begin to decline in absolute terms clearly presents a huge challenge. But taking early steps to set in motion some of the long-term changes that 

will eventually be required can be done at reasonable cost. As in the analogy of the 

heart patient, timing is everything. The longer we wait, the more difficult it becomes to achieve any given stabilization target without incurring large, wrenching, 

and probably quite expensive changes to our existing energy systems. That’s why 

the academies’ statement urges governments to ‘‘recognize that delayed action will 

increase the risk of adverse environmental effects and will likely incur a greater 

cost.’’

The National Commission on Energy Policy shares this view. We too concluded 

that a lack of full scientific certainty must not be an excuse for inaction and that 

the key thing is to start now by taking cost-effective steps that will contribute to 

substantial long-term emissions reductions. That’s why we recommended a very 

gradual program for limiting greenhouse gas emissions that explicitly holds costs to 

a reasonable level. Our proposal does not solve the climate problem—in fact, as our 

critics often point out, it allows U.S. emissions to continue to rise in the first decade 

of program implementation. But it does begin to generate the clear and quantifiable 

market signals that will be needed to elicit technological innovation and long-term 

investment in lower-carbon alternatives. That’s a small step to be sure, but it may 

be our best hope for getting started and, by doing so, for turning climate change 

from an overwhelming challenge into a difficult, but manageable one. 

Question 5. Several scientists have cited events like the high temperatures in Europe in the summer of 2003 and increased storminess in the 1980s and 1990s as 

evidence of climate change. Don’t global ecosystems go through natural periods similar to these as well? 

Answer. While it is true that there are natural climate cycles that can cause 

events such as those cited in this question, it is also true—based on a number of 

studies—that such events are likely to occur with far greater frequency as a result 

of human-caused increases in atmospheric concentrations of greenhouse gases. For 

example, a study by researchers at the U.K. Meteorological Office and Oxford University that used both field measurements and computer models concluded that the 

chance of a heat wave as severe as that of 2003 in Europe had at least doubled and 

probably quadrupled due to higher levels of greenhouse gases in the atmosphere.6

The study further found that summers like 2003 (which would be an extremely rare 

event under normal circumstances) are likely to occur every other year by the middle of this century due to global warming. 

As for severe storms, a recent study by MIT hurricane expert Kerry Emanuel 

(2005) shows that the destructive power of hurricanes has increased markedly over 

the past 30 years and that this increase is highly correlated with rising sea surface 

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7 Emanuel, Kerry, 2005, Nature, 4 August 2005, Vol. 436/4, Increasing destructiveness of tropical cyclones over the past 30 years. 8See, for example, Groisman, Pavel, R.W. Knight, T.R. Karl, Feb. 2001, Bulletin of the American Meteorological Society, Heavy precipitation and high streamflow in the contiguous United 

States: trends in the 20th century. 

temperatures due to global warming.7 This increase in destructiveness is due to 

both longer storm lifetimes and greater storm intensities. Other studies over recent 

years have shown that the incidence of heavy and very heavy precipitation events 

(i.e., major downpours) has likewise increased in recent decades, leading to increased flooding and erosion.8 These trends have been similarly linked to the warming effects caused by human-induced increases in the atmospheric concentration of 

greenhouse gases. 

Question 6. There are a number of astrophysicists and other scientists who believe 

that sunspots are a major contributor to changing temperatures. A recent survey 

showed at least 100 such studies are underway. Why don’t scientists put as much 

emphasis on this possibility or other aspects of natural climate variability as they 

do on emissions from human activity? 

Answer. Sunspots are a cyclical phenomenon—they increase and decrease with a 

period of about 11 years. Such short-cycle ups and downs do not produce long-term 

trends in climate. There is evidence that the output of the sun varies also on longer 

time scales, and there is much scientific interest in how this works and how it may 

have affected Earth’s climate over geologic time. The IPCC’s estimate in its 2001 

report was that the role of changes in the sun’s output in the climate forcing of the 

past 250 years is in the range of 10 times smaller than the role of anthropogenic 

greenhouse gases. And a wide variety of studies show that the rapid increase in 

temperature experienced in the last part of the 20th century and continuing today 

was not due to changes in solar output, which have been very small in this period. 

‘‘Fingerprint’’ studies based on complex patterns of temperature changes over the 

Earth and in different layers of the atmosphere have used observations and models 

to attribute the observed temperature record of past decades to particular factors 

that influence climate. Such studies have been helpful in determining which factors 

are most responsible for the observed changes. None of these studies have concluded 

that solar influences are a major factor in the observed trends. There is thus no scientific evidence to support the notion that sunspots or other natural variables are 

as important as human-caused emissions in explaining recent warming trends. 

Question 7. Much of the discussion about climate science being settled is based 

on the summary chapter of the Intergovernmental Panel on Climate Change of the 

United Nations. The chapter made specific predictions about the pace of rising temperatures and the relative importance of human activities to climate change. And 

yet, the body of the report is much more ambiguous and inconclusive about the current state of the science. Is anything being done to ensure that the summary of the 

next IPCC report is more reflective of the overall analysis by the scientists? 

Answer. It is simply not the case that the summary chapter is inconsistent with 

the body of the IPCC report. Rather, any differences in tone most likely reflect the 

difference between a document oriented to policy-makers and decision-makers vs. a 

document oriented to a scientific audience. The IPCC technical chapter authors conduct their analyses and communicate their results based on the traditional decisionmaking paradigm of the scientific community, namely to have 95% or better confidence that what you say is the correct explanation AND 95% or better confidence 

that there is no other alternative explanation. While this level of certainty is appropriate in the context of pure scientific inquiry it is rarely, if ever, achievable in the 

realm of policy making. 

The IPCC Summary for Policymakers thus represents a translation of the significance of the scientific findings into terms that policymakers can work with. In making this translation, IPCC authors agreed on a specific lexicon (i.e., the sequence of 

words ‘virtually certain,’ ‘very likely,’ ‘likely,’ etc.) to define relative levels of likelihood and certainty based on best evidence and considered scientific judgment. The 

meaning of these terms is carefully spelled out in the IPCC report and their use 

is footnoted throughout the text. Of course, some scientists are not entirely comfortable with the results of this translation—after all, it is always possible for a 

reader to misunderstand the scientific nuances and to draw incorrect conclusions 

from necessarily qualitative terms such as ‘‘very likely’’ or ‘‘virtually certain’’. In the 

case of climate change, as with most other important public policy challenges, however, policy makers simply do not have the luxury of waiting until all scientific uncertainties are resolved before some difficult decisions must be made. As a result 

it will continue to be necessary to undertake the process of translation exemplified 

by the IPCC report’s Summary chapter. 

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In sum, while I’m sure the IPCC will continue to work to improve its approach 

to communicating scientific understanding, this does not mean that the current 

Summary does not represent a fair and reasonable characterization of the best 

available climate science as the IPCC authors felt it should properly be applied in 

a policymaking context. 

Question 8. The natural ‘‘greenhouse effect’’ has been known for nearly two hundred years and is essential to the provision of our current climate. There is significant research in the literature today that indicates humans, since the beginning of 

their existence, have caused an increase in the greenhouse effect. Some argue that 

the development of agriculture 6,000 to 8,000 years ago has helped to forestall the 

next ice age. The development of cities, thinning of forests, population growth, and 

most recently the burning of fossil fuels, have all had an impact on climate change. 

Our ecosystems have constantly adapted to change, as we as humans have adapted 

to our ecosystems as well. Is it possible that the increased presence of CO2 caused 

by the 8,000 years of modern human existence may be something our ecosystems 

will continue, as they previously have, to naturally adapt to? 

Answer. The advent of agriculture 6,000 to 8,000 years ago may have caused 

changes in the atmosphere which in turn triggered climatic changes, but those 

changes occurred within a range that had been experienced on Earth in the preceding million years. In other words, ecosystems had to readjust to conditions that 

had obtained at some point in the—geologically speaking—relatively recent past, 

rather than to an entirely new set of conditions. What is happening now is that the 

climate is responding to atmospheric conditions that have not occurred for at least 

several million years. Moreover, this change may be happening with unprecedented 

rapidity. Within a century, atmospheric CO2 is projected to be at levels that have 

not been experienced on Earth in tens of millions of years. For natural ecosystems, 

then, the really key issue may not be how much the climate is changing, but how 

fast that change is occurring. 

Climatic conditions have, until recently, also been relatively stable over the history of human civilization. Our present societies are adapted in many ways to conditions that have obtained for at least several centuries. Because of our technological 

prowess, human societies are likely to be better able to adapt to a rapidly changing 

climate than natural ecosystems, which can respond only slowly to changing conditions. But the pace of change will have important consequences for human adaptability as well. The more quickly buildings, infrastructure, agricultural practices, 

water systems, and other aspects of society are forced to change, the more costly 

it will be to adapt and the higher the toll is likely to be in terms of human morbidity, mortality, and diminished quality of life. This is especially true, of course, 

for impoverished nations that are already more vulnerable to changing natural conditions and that lack the resources of more developed societies to adapt effectively. 

Finally, it is worth noting that if human activities 6,000 to 8,000 years ago could 

cause climatic impacts of the magnitude indicated by the above question, this implies that the far more significant changes we are now causing in the atmosphere 

are likely to have commensurately more dramatic consequences for global climate 

conditions. 

Question 9. NCEP has previously explained that there are significant uncertainties, both scientific and technological, and that the best approach is ‘‘the search for 

a mix of affordable technical and policy measures.’’ Given your support of this proposal, could you outline how and what measures you would enact? 

Answer. This question may be primarily intended for other panelists who were 

not, as I was, active participants in the National Commission on Energy Policy 

(NCEP). Nevertheless I will say that, in a nutshell, the NCEP’s recommended approach is to combine an initially modest, economy-wide, market based program for 

limiting future greenhouse gas emissions with substantial new public investments 

in developing and deploying advanced low-or non-carbon energy alternatives. Our 

specific recommendations are outlined in detail in the report we released last December. A summary of our proposal with respect to a tradable-permits program for 

limiting greenhouse gas emissions was provided in written testimony provided to 

the Committee by NCEP Executive Director Jason Grumet. The full report, copies 

of which have previously been given to the Committee and which is readily available 

from NCEP, also included two illustrative tables summarizing the scope of technology investments proposed by the Commission and their possible allocation, both 

as between (1) basic RD&D vs. early deployment incentives and international cooperation and (2) as between different technology areas (e.g., energy efficiency, advanced fossil fuel technologies, nuclear, renewables, etc.). 

Question 10. The panel touched on some energy alternatives such as biomass, natural gas, and nuclear power, yet there was little mention of hydrogen power. From 

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a scientific viewpoint, where do you think we are on being able to really utilize hydrogen power? What is the potential of hydrogen power? 

Answer. The most important point to understand about hydrogen is that it is not 

an energy source like coal or nuclear energy or sunlight, but only an energy carrier 

(like electricity), which society can choose to produce from one or more of the available energy sources in order to improve the convenience, versatility, efficiency, or 

environmental characteristics of our energy system. Like electricity, hydrogen is 

very clean at the point of end-use (but not necessarily at the point of its manufacture), and also like electricity, hydrogen uses more raw energy in its production 

than the product contains. Society will choose to pay this energy price for hydrogen 

production when the ‘‘system’’ benefits in terms of the combination of cleanliness, 

convenience, and economics warrant it, but until now this has only been the case 

for chemical uses of hydrogen (such as in fertilizer production), not in the energy 

system. 

One powerful motivation for pursuing the use of hydrogen in the energy system 

is that stripping hydrogen from hydrocarbon fuels such as coal, oil, and natural gas 

would provide a way to ha mess much of the energy content of these fuels while 

capturing the carbon for sequestration away from the atmosphere. This is, in essence, what happens in an Integrated Gasification Combined Cycle power plant with 

carbon capture, and what would happen in still more advanced coal power plants 

that used fuel cells for converting the hydrogen to electricity rather than burning 

the hydrogen in a gas turbine. Avoidance of the carbon emissions from autos, trucks, 

and buses would likewise be one of the main motivations for converting such vehicles to use hydrogen as fuel, along with the motivation that the hydrogen could be 

produced from a wide range of energy sources, not just from the petroleum that is 

the only important source of gasoline and diesel fuel for these vehicles today. 

In developing our recommendations, other NCEP members and I gave considerable emphasis to the development of the coal-gasification and carbon-capture-andsequestration technologies that are likely to be the earliest opportunity to benefit 

from hydrogen in the energy sector. We also examined the prospects for the use of 

hydrogen as a low carbon alternative to oil-based transportation fuels. We recognized that hydrogen in this role offered some theoretically impressive environmental 

and national security benefits and might have the potential, at some point in the 

future, to play an important role in the transportation fuel mix. We also, however, 

quickly reached the conclusion that a number of very significant technological challenges must be overcome to realize this potential. In fact, because these near-term 

technological hurdles are so significant we concluded that hydrogen in the transport 

sector offers little to no potential to improve oil security and reduce climate change 

risks in the next twenty years. Accordingly, while we remained supportive of basic 

research into hydrogen in portable applications as a potential long-term (i.e., roughly mid-century) solution, we also urged that efforts to speed the deployment of a hydrogen transportation system not displace other activities that could deliver far 

more significant results in terms of reducing greenhouse gas emissions and petroleum consumption over the next twenty years. I will note that the National Academy of Sciences, in a separate and more comprehensive report on hydrogen that was 

released in 2004, came to very similar conclusions. 

Question 11. The panel established very clearly that we should adopt policies that 

decrease carbon emissions regardless of any other carbon emissions policies we pursue. We are currently or will shortly be providing expanded incentives for clean coal, 

nuclear energy and renewable fuels. Do you feel this is money well spent? What 

technologies do you feel the government should be more involved in developing? 

Answer. As noted in my response to a previous question, the recently passed Energy Bill includes a number of provisions, including several important provisions related to technology incentives, that I and other members of NCEP support. As I 

have also previously stated, however, the effectiveness of these incentives is likely 

to be substantially undermined by the fact that they are not accompanied by a mandatory program that would place a firm financial value on avoided greenhouse gas 

emissions. 

It is somewhat ironic that a number of European nations are implementing market-based regulatory approaches developed here in the Unites States while we pursue a top-down program of government-directed, tax payer funded research and deployment incentives. Developing and commercializing new technologies will cost 

money. The question is who is best positioned to secure and effectively spend these 

resources. While there is certainly a role for public funding and government incentives, the Commission believes that there must also be a role for those who emit 

greenhouse gases to share in the costs of developing solutions. As we have learned 

over the last twenty years, given a rational reason to invest, the private sector is 

far better than the government in developing technological solutions. The success 

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of the acid rain program demonstrates that the most effective way to engage the 

ingenuity of the private sector is to place a monetary value on a ton of reduced 

emissions thus creating a real economic incentive to develop cleaner forms of energy. 

RESPONSES OF DR. MARIO MOLINA TO QUESTIONS FROM SENATOR TALENT

Question 1. In your testimony, you state that ‘‘the climate system is very complicated and science does not have all of the answers.’’ Also, ‘‘There is of course 

much we do not fully understand about the timing, geographic distribution, and severity of the changes in climate... that will result if heat-forcing emissions continue.’’ Finally, you add that ‘‘not knowing with certainty how the climate system 

will respond should not be an excuse for inaction.’’ To me, your statements say that 

we should proceed with caution and not mandate anything until we know that the 

mandated action will, in fact, solve a problem in a cost-effective manner. Are you 

suggesting that the Administration’s proposal for continued study and incentives for 

voluntary adoption of technology both here and abroad are an insufficient response 

given the certainty of the data both with respect to the quantification of the problem 

and the solution? 

Answer. It is important to recognize that U.S. climate policy for more than a decade now has consisted of continued study, technology incentives, and voluntary programs. Progress has been achieved during that decade, to be sure: individual companies made efforts to reduce their emissions, promising new technologies like hybrid 

vehicles and coal IGCC emerged, and we reached a much better understanding of 

climate science and of the dynamics underlying potential responses to human-induced changes in the composition of the atmosphere. But the more than 10 years 

that have passed since the first Bush Administration signed the original International Framework Convention on Climate Change have also demonstrated the 

limits of voluntarism. Overall, energy-related U.S. greenhouse gas emissions have 

increased by approximately 12% between 1993 and 2003, the fuel economy of our 

vehicle fleet has actually declined, and our near-exclusive dependence on fossil fuels 

in all aspects of our energy system remains as entrenched as ever. Meanwhile, the 

risks of continuing on our present course have come more clearly into focus than 

ever before. 

In this context, I believe it’s important to think carefully about the meaning of 

caution. Confronted with ever stronger evidence of a potential risk, are we really 

being cautious to continue increasing our exposure to that risk? Or is it time to do 

more, albeit cautiously, to reduce this exposure? I would argue that it is indeed time 

to do more—and by more I mean moving beyond a policy of pure voluntarism. Certainly, the Administration’s proposals to promote advanced technologies here and 

abroad can help. I couldn’t agree more strongly that technology investment and increased cooperation with other countries, especially developing countries, are critical 

components of a sound climate policy. But by themselves they are not enough. For 

reasons articulated in my responses to several previous questions, it is critical to 

begin harnessing the power of the marketplace. Simply put, companies need to be 

able to attach a hard value to avoided carbon emissions if we are going to expect 

them to make long-term investments in climate-friendly technologies. In a competitive world they will never be able to do that absent a mandatory policy. 

NCEP has recommended one approach to implementing such a policy. Moreover, 

we believe our proposal for a tradable permits system for greenhouse gases is extremely cautious in the sense that it is cost-capped, flexible, gradual, and includes 

multiple opportunities for review and adjustment. It is so cautious, in fact, that our 

own analysis and that of the Energy Information Administration indicate it will 

have no material effect on the U.S. economy over the next decade or more. The specifics of our proposal can certainly be debated; the need for something like it, in my 

view, cannot. So by all means, let us proceed cautiously. But let us not misunderstand caution to imply that we should merely continue doing what we have been 

doing, even if that means increasing our exposure to potentially significant climate 

risks. 

Question 2. You suggest that a 5 degree F temperature increase could lead to a 

whole host of disasters from agriculture losses to drought to melting glaciers and 

changes in ocean circulations. Do you have evidence of any of this occurring with 

a 5 degree F increase in temperature, or is this merely speculative? How much of 

a possible 5 degree F increase in temperature would be attributable to GHGs that 

are at least nominally under our control? How much of any emission cuts that the 

U.S. might have to make would simply be overtaken by increases in emissions by 

developing nations such as China and India? 

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Answer. While global average temperatures have increased by about 1.5 degrees 

F since pre-industrial times, the warming that has already occurred over the past 

few decades in Alaska and the rest of the Arctic is considerably more dramatic (on 

the order of 3 degrees F). Not surprisingly, Alaska and other northern regions are 

also providing some of the strongest observable evidence to date of the kinds of impacts that could be associated with warming of this magnitude. As noted in response 

to a previous question, these impacts include severe coastal erosion due to retreating sea ice, rising sea level, and thawing of coastal permafrost and attendant damage to buildings, roads, and industry. In sum, the proposition that a 5 degree F increase in global average temperatures—which would amount to a three-fold increase 

in the amount of warming that has already occurred—could cause serious consequences, can hardly be characterized, at this point in time, as ‘‘merely speculative.’’

On the contrary, further warming of this magnitude is likely to greatly amplify 

many of the negative impacts we are already seeing in Alaska and elsewhere. Temperature changes in the high northern latitudes, which are likely to continue to be 

more dramatic than the global average, could initiate the rapid deterioration of the 

Greenland Ice Sheet (which would likely raise the rate of sea level rise to well over 

3 feet per century) and cause much further disruption of natural ecosystems, wildlife, and forests. Other consequences in the United States alone could include a significant diminution of spring snowpack in mountain regions, which would greatly 

exacerbate the chronic water shortages that already exist in the western United 

States, an increased incidence of serious fires in western forests as well as of extreme weather events, like heavy downpours and heat waves, and declining agricultural productivity in some regions. Meanwhile, impacts in other parts of the world 

would likely be even worse. 

Turning to the issue of international participation, it is of course undeniably true 

that climate change is a global problem and that efforts to address it will only be 

successful if every major emitting nation, including developing countries like China 

and India, takes part. It is, however, equally true that such international cooperation—and particularly the participation of countries like China and India—is unlikely to be forthcoming absent U.S. leadership. As the country with the world’s 

highest emissions, in both absolute and per capita terms, and as the country that 

is responsible for by far the largest share of the increase in atmospheric greenhouse 

gas concentrations that has already occurred (and hence for a disproportionate 

share of the warming to which the planet is already committed), the United States 

cannot expect other countries to be sympathetic to the argument that it should not 

act because any domestic emissions reductions it implements might be offset by 

emissions increases elsewhere. Instead, the United States should set an example 

and demonstrate its own commitment to addressing the climate problem in a meaningful way, while at the same time making vigorous efforts to engage other nations. 

NCEP recommended just such an approach precisely because we felt it was most 

likely to produce the kind of international participation that will ultimately be vital 

to mounting an effective global response to the problem of climate change. Given 

the interest that countries like China and India have in pursuing a more sustainable energy policy—in some cases as much from the standpoint of energy security 

as out of concern about climate change or environmental quality—we believe there 

is every reason to be optimistic that a proactive response from the United States 

would inspire further action to limit emissions by other countries. 

Question 3. What if the science showed only a 2-4 degree F increase in temperature by 2100? Would you still advocate mandatory emissions reductions at this 

time? If so, is the technology available today to accomplish those cuts without raising energy costs? 

Answer. Even if the magnitude of predicted warming were somewhat lower than 

current estimates (e.g., 2-4 degrees F as opposed to 5 degrees F by 2100), the possibility that the actual warming itself and/or its impacts could be more severe than 

expected—especially if the global climate system responds in non-linear ways as a 

result of some of the potential feedback mechanisms discussed previously—together 

with the near certainty that temperatures would continue to rise well into the 22nd 

century absent some action during the coming decades to reduce emissions, would 

still, in my opinion, argue for mandatory near-term steps aimed at slowing, then 

stopping, and eventually reversing current emissions trajectories. The significant 

impacts that are now being experienced in some places due to the 1.5 degree F increase we have already sustained argue that another 2-4 degrees F would constitute 

dangerous interference with the climate system, something we have pledged to 

avoid under the Framework Convention on Climate Change signed by George W.H. 

Bush. 

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Given the current status of technology, the Commission believes there is no entirely costless way to achieve this objective: any market signal that attaches a positive value to avoiding greenhouse gas emissions will necessarily produce an increase 

in the cost of using carbon-producing fossil fuels. It is, however, possible to limit 

the impact on energy costs to a reasonable and, in our view, politically and socially 

acceptable level. Specifically, the approach we have proposed (which involves a 

tradable-permits system for limiting greenhouse gas emissions combined with a 

safety-valve mechanism that explicitly caps program costs) is estimated to have only 

a small impact (less than 7% for gasoline, natural gas, and electricity) on predicted 

energy prices over the next 15 to 20 years. Over time, we believe this market signal 

will help prompt the innovation and technology investment needed to make further 

emissions reductions feasible while holding costs and overall energy price impacts 

to a minimum. 

Question 4. In your policy formation statement, you indicate that we should 

search for a mix of affordable technical and policy measures that will be able to reduce emissions and adapt to the degree of climate change that cannot be avoided 

without incurring ‘‘unreasonable costs.’’ Please define what you mean by unreasonable costs. Do these costs factor in the transfer of industry and jobs to such developing countries as China and India and, if so, do the emission cuts by the U.S. plus 

the increases by China and India result in a net increase or decrease in emissions? 

Answer. The Commission made no attempt to define ‘‘unreasonable costs’’, but we 

did agree that the explicit cost cap included in our proposal for a mandatory greenhouse gas tradable permits program met the test of reasonableness. Because of the 

safety valve mechanism in our proposal, we know with certainty that impacts on 

energy prices for consumers and businesses would be relatively modest (less than 

7% for gasoline, natural gas, and electricity). As I have already noted, the Energy 

Information Administration has concluded that our proposal would have no ‘‘material impact’’ on the nation’s economic growth or prosperity between now and 2025. 

This result rules out the possibility that our proposal could cause any significant 

transfer of industry and jobs to other countries. 

While we are confident that implementing the kind of policy we have recommended will not cause any offsetting emissions increases in China and India, we 

of course recognize that rapidly growing emissions in these countries must also be 

addressed if there is to be a meaningful global response to the climate issue. Just 

as domestic efforts to address climate change will not be successful in the long run 

absent global participation, however, efforts to engage major developing countries 

like China and India are unlikely to be successful absent U.S. leadership. The best 

way to re-establish that leadership, in our view, is for the United States to take an 

initial step domestically with the understanding that further emissions reduction efforts will be contingent on comparable efforts by other major emitting nations. Accordingly, our proposal is explicitly phased and calls for periodic reviews to assess 

international as well as domestic progress. Depending on the results of these reviews, the United States could opt to make a variety of adjustments to the tradable 

permits program, including suspending further increases in the safety valve price. 

In addition, to encourage emissions mitigation efforts by nations like China and 

India, the Commission recommends that the United States continue and expand 

current bilateral negotiations and provide incentives to promote technology transfer 

and to encourage U.S. companies and organizations to form international partnerships for implementing clean energy projects in developing countries. 

Question 5. What is the impact of the U.S. adopting Bingaman/NCEP and China 

and India not doing so? When the industry and jobs move to China and India, don’t 

global emissions actually go up, as even today, the U.S. has and will continue to 

have better environmental controls than developing nations? Wouldn’t we be better 

served transferring the technology that we know works to developing nations as 

they grow in their industry and electricity generation? 

Answer. For the reasons described in the previous response, we do not believe 

that implementation of the Bingaman/NCEP proposal will cause industry and jobs 

to move to China and India. Moreover, if China and India do not act, we would expect Congress to halt further increases in the safety valve price, thereby allowing 

the effective stringency of the U.S. program to diminish over time. We think it far 

more likely, however, that China, India, and other major emitting nations will respond positively if the United States adopts a meaningful, mandatory policy for reducing greenhouse gas emissions. In fact, some of these countries have already 

begun reducing their emissions below forecast levels as they pursue improved energy security, energy efficiency, conventional pollution control, and market reform. 

All of these efforts will be enhanced by continued technology transfer from the 

United States to developing nations which we strongly support as a complement to, 

rather than substitute for, domestic action. 

188

9See, for example, Mears, C.A., M.C. Schabel, and F.J. Wentz, 2003: A Reanalysis of he MSU 

channel 2 tropospheric temperature record. J. Climate, 16, 3650-3664; Vinnikov, K.Y., and N.C. 

Grody, 2003: Global warming trend of mean tropospheric temperature observed by satellites. 

Science, 302, 269-272; and Vinnikov, K.Y., A. Robock, N.C. Grody, and A. Basist, 2004: Analysis 

of diurnal and seasonal cycles and trends in climatic records with arbitrary observation times. 

Geophys. Res. Lett., 31, L06205, doi:10.1029/2003GL019196, 2004. 10Mears, C.A., and F.J. Wentz, Science, 2005: The effect of diurnal correction on satellite-derived lower tropospheric temperature. 11 Aug 2005. 

Question 6. What do you make of the fact that while NOAA concluded that 2004 

was the fourth warmest year on record and that some of the warming was humaninduced, that satellite instruments (which indirectly measure the average temperature of the atmosphere in a deep column above the surface) are hard pressed to 

demonstrate any positive trends over the past 20 years? 

Answer. This question refers to outdated information about the satellite data 

based on initial analyses by J. Christy and R. Spenser that have since been corrected. In addition, the rate of warming both at the surface and in the troposphere 

has increased in the years since that initial analysis. 

Recent peer-reviewed analyses of the satellite data have shown that the low and 

mid troposphere have in fact warmed at about the same rate as the surface over 

the past several decades (see e.g., Mears et al., 2003; Vinnokov and Grody, 2003; 

Vinnikov et al., 2004).9 The earlier notion that the troposphere had not warmed was 

based on significant errors in adjustments to the satellite data. As each error was 

corrected, the data showed more warming. Studies published this month (11 August 

2005) in Science expose the most recently discovered of these errors.10

Though there are minor discrepancies between data sets due to the different 

methods that research teams use to analyze the data, the bottom line is that both 

the surface and the troposphere show significant warming trends according to all 

the data records: those derived from thermometers at the surface, those derived 

from sensors on satellites, and those obtained from weather balloons. There is no 

major difference between surface and tropospheric warming at the global scale over 

the past 50 years. 

Question 7. If all the countries that have signed Kyoto stay within compliance of 

Kyoto, how much of a reduction in global warming would this result in? 

Answer. The Kyoto Protocol never represented more than a first step toward addressing the climate problem at a global level—indeed it sought to define only relatively near-term (2008-2012) emissions targets. As such, it was not designed to, by 

itself, achieve the sustained, overall emissions reductions that would be necessary 

to prevent or substantially mitigate expected changes to the Earth’s climate as a 

result of increased atmospheric concentrations of greenhouse gases. Rather, the argument for ratifying Kyoto (which has now been done by nearly all of the United 

States’ major industrialized trading partners) always rested on the proposition that 

it was important for the developed countries to lead the way in starting to curb future emissions, even if it was understood that these early efforts would have little 

effect in and of themselves unless they were followed up in the post Kyoto era by 

a more comprehensive global effort. 

I and other members of NCEP essentially share the conviction that near-term, 

mandatory action and leadership by developed nations like the United States are 

necessary to begin making progress on the climate issue. We also believe, however, 

that we have crafted an approach that is preferable to Kyoto insofar as it convincingly addresses the cost, equity, and competitiveness concerns that have been raised 

in connection with Kyoto. In any case, all sides in the ongoing domestic and international debate over future climate policy should be able to agree that the time for 

debating the merits of the Kyoto Protocol is past. That debate is now largely moot 

and prolonging it only serves those whose interests lie in continued policy paralysis 

and delay. 

Question 8. Can you confirm that suspended water vapor levels, cloud cover percentages and direct solar irradiation changes over time all represent variables in 

these forecasting models that could have significant impacts on the conclusions of 

the results of these models? 

Answer. Certainly all of these variables have a significant impact on the Earth’s 

climate system and on the predictions generated by existing climate models. Accordingly, our ability to accurately incorporate these (and many other) variables in our 

models is constantly being refined and compared to actual observations. While uncertainties remain in specific areas, however, our overall confidence in existing climate models is bolstered by several factors. First, as noted in my response to a previous question, current models can replicate past and present climates as well as 

the influences of the most important factors that affect climate. Second, a variety 

189

of models, all of which have been extensively compared, tested, and refined, provide 

essentially coherent and consistent results concerning the likely impacts of anticipated changes in the composition of the Earth’s atmosphere. Thus while different 

models may treat individual variables such as those identified above somewhat differently, the fact that they nevertheless come to substantially similar conclusions 

suggests that we can have a high degree of confidence in their overall results. 

Question 9. In looking at pre-industrial global temperature patterns, would you 

agree that changes in temperatures over time have occurred that had no anthropogenic basis? 

Answer. It is of course true that changes in global temperatures occurred before 

human activities had any significant impact. Scientists who study past climates 

have been able to identify the likely causes of most of those changes and have determined that the warming trend observed in global average temperatures over the 

last 50 years is strikingly different from past changes and can only be explained 

by including human influences in the calculus. In fact, the IPCC has concluded that 

human activities not only play a role, but are primarily responsible for this trend. 

Two points are relevant here. The first is that as noted repeatedly in response to 

previous questions—it is the pace of anticipated climate change, as much as the potential magnitude of this change, that we should be worried about. Compared to 

past climate changes that occurred as a result of purely natural influences, humaninduced climate change appears to be progressing at a rate that is simply unmatched in recent geological time. Second, the fact that climate change can also 

occur absent human influence does not lead logically to a justification for complacency. One might as well argue that because wildfires can also be caused by lightning, people should feel free to toss lit matches into the forest. 

Question 10. Do we know what the ‘‘best’’ global temperature is to sustain life? 

Answer. The most general answer to this question is that there is no single ‘‘best’’ 

temperature for sustaining life on Earth. At any given temperature, different organisms and ecosystems will evolve toward a different equilibrium than they would 

at any other temperature and it is fundamentally impossible to single out any one 

of these states as definitively ‘‘better’’ than any other. More than any particular 

temperature, however, it is possible to say that climatic stability is important to sustaining life. Dramatic and rapid changes in climate are almost always detrimental, 

both to individual organisms and to the larger ecosystems they inhabit. 

To attempt a more specific answer to this question, one would have to start by 

specifying what type of life one is interested in sustaining. Insects and weeds, for 

example, tend to do very well in a warmer world (as evidenced by the recent massive increase in spruce bark beetle outbreaks and the observed doubling of ragweed 

pollen production). On the other hand, some species, like the golden toad that used 

to inhabit the cloud forest of Costa Rica, have already been driven to extinction by 

the warming that has already occurred over the past 50 years. Other species, like 

the polar bear and ice-dependent seals, are increasingly stressed and may find it 

more and more difficult to survive in the wild as continued warming further shrinks 

the summer sea ice on which they depend. Coral reef ecosystems, the nursery for 

many marine species, are also at risk of succumbing to warmer temperatures and 

the changing chemistry of ocean water due to rising atmospheric CO2 levels. Many 

other life forms that cannot adapt or relocate quickly are similarly threatened by 

rapid, human-induced climate change. 

Assuming that the priority for most policymakers would be to preserve optimal 

conditions for human life, it remains difficult to identify a single ‘‘ideal’’ temperature. Here again, however, the more relevant point is that human societies and infrastructure the world over have developed in climatic conditions that have been remarkably stable for 10,000 years. As a result, the assumption that these conditions 

will continue is ‘‘built into’’ most aspects of our existence, whether we live in highly 

industrialized societies or in societies that are more directly dependent on natural 

systems for shelter and sustenance. A rapidly changing climate could therefore impinge on human existence and quality of life in a wide variety of ways. At best, the 

consequences will frequently be costly and inconvenient; at worst they could cause 

significant loss of life and higher rates of injury and disease. 

To give just one example, many of the world’s coastlines have become heavily populated under the implicit assumption that sea level would be relatively stable. But 

global warming is already causing sea levels to rise and is likely resulting in higher 

storm surges, more coastal erosion, and a marked increase in the destructive power 

190

11For example, Emanuel (2005) has documented a marked increase in the destructive power 

of hurricanes over the past 30 years as these storms have become, on average, more intense 

and of longer duration (Emanuel, Kerry, 2005, Nature, 4 August 2005, Vol. 436/4, Increasing 

destructiveness of tropical cyclones over the past 30 years.). 

of hurricanes.11 If these trends continue, the consequences in wealthier countries 

like the United States could include substantial property losses and high costs to 

move housing and infrastructure as populations are forced to relocate further inland. In poorer and more vulnerable low-lying countries like Bangladesh, the results 

would likely be more dire and could include significant loss of life, increased incidence of disease, and massive population displacements. 

Question 11. What is currently being done to curb emissions from parts of the 

world in poverty who are deforesting their environment and burning biomass for all 

means of day-to-day living, and are these emissions continuing to increase in the 

world? 

Answer. Developing nations have as much reason as developed nations to be concerned about climate change and as much incentive to reduce their greenhouse gas 

emissions, given that they are likely to be especially vulnerable to the negative impacts of future warming. What they lack, in many cases, are the economic and institutional resources to implement policies for reducing emissions, as well as access to 

the technologies that would make it possible to pursue their legitimate aspirations 

for development in a more environmentally sustainable manner. This situation 

speaks to the need for a continued emphasis on technology transfer and assistance 

from developed countries to the developing world to overcome these obstacles. At the 

same time, it must be emphasized that many developing countries are already making concerted efforts to address environmental and public health concerns in ways 

that will also yield ancillary benefits in terms of reduced greenhouse gas emissions. 

Examples include efforts to reduce methane emissions from sewage and garbage 

(these emissions can be comparatively large in many developing countries), to address a major public health concern by reducing soot emissions from inefficient cooking stoves and 2-stroke engines, and to limit deforestation and restore vegetation 

cover as means of controlling erosion and improving water quality. In some cases, 

developing countries have even moved ahead of developed countries with respect to 

adopting progressive environmental or energy policies. China, for instance, recently 

moved to implement tougher automobile fuel economy requirements than currently 

exist in the United States. 

Question 12. Do you believe it is practical to seek emission controls in parts of 

the world that are struggling in poverty? 

Answer. With assistance and access to improved technologies, it is not only practical but essential for many poor nations to pursue a development path that is 

cleaner, more sustainable, and less carbon-intensive than the development path 

traveled by already wealthy, industrialized nations. I believe it is the responsibility 

of developed nations to help make this possible. 

Question 13. What is being done to curb emissions in the developing countries like 

China and India? 

Answer. See question 11 above. 

RESPONSES OF DR. MARIO MOLINA TO QUESTIONS FROM SENATOR FEINSTEIN

Question 1. Is there any credible scenario for stabilizing greenhouse gas emissions 

that does not involve the United States and other major emitters stopping their 

emissions growth over the next couple of decades and sharply reversing their emissions growth by 2050? 

Answer. No. To stabilize atmospheric greenhouse gas concentrations during this 

century, total global emissions—including emissions from the United States and all 

other major emitting nations—must begin to decline at some point in the coming 

decades. The steepness of this decline or—as you put it the sharpness of the reversal, depends on the stabilization target being pursued and on when the decline commences. For example, one estimate published by Wigley, Richels, and Edmonds in 

1996 indicates that global emissions must begin to turn down beginning in 2035 in 

order to achieve the goal of stabilizing atmospheric CO2 concentrations at 550 ppm 

by the end of the century. By the same token, slowing the rate of emissions growth 

in the near term will allow the eventual decline needed to achieve a given stabilization target to be more gradual and/or to commence at a later point in time. 

Question 2. Would the National Commission on Energy Policy’s proposal stop and 

then reverse U.S. greenhouse gas emissions? 

Answer. The NCEP proposal lays out a specific approach for achieving the slow 

and stop phases of a program to reduce U.S. greenhouse gas emissions. The slow 

191

* The accompanying graphic has been retained in committee files. 

phase covers the first decade of program implementation (from 2010 through 2019); 

the stop phase is initiated starting in 2020. Put another way, the NCEP recommendations take us to the year 2020 on the below graphic and not beyond. We 

consciously chose not to detail the terms of the ‘‘reverse’’ phase, recognizing that it 

would be presumptuous and probably meaningless to presuppose the likely evolution 

of an intentionally flexible and contingent program more than two decades into the 

future. That said, it is important to point out that the architecture of our proposed 

policy would readily support the implementation of a reverse phase designed to 

steadily reduce U.S. emissions.* 

As our report states, the NCEP proposal ‘‘ should be understood as an initial domestic step in the long-term global effort to first slow, then stop and ultimately reverse current emission trends. In its structure and stringency, the Commission’s 

proposal is designed to encourage the timely initiation of what will necessarily be 

a phased process. The Commission believes that this approach is more pragmatic 

and ultimately more effective than years of further legislative stalemate in pursuit 

of a more aggressive initial goal.’’

Put simply, we believe that the accumulated emissions resulting from additional 

years of inaction are almost sure to be greater than the possible benefits that would 

result from postponing more aggressive action to a point in the more distant future. 

Once a market signal is in place, we expect that solutions will flourish, anxieties 

will abate, and Congress will be better able to predict and then adopt more stringent iterative emissions reduction requirements. 

RESPONSES OF RICHARD D. MORGENSTERN TO QUESTIONS FROM SENATOR BINGAMAN

Question 1. Questions have been raised about the uncertainties for potential investors in new refineries or other energy facilities that could be created by the provision in the Bingaman amendment that calls for Congress to review emissions 

goals, price caps, and other features every five years. Could you comment on this? 

Answer. My understanding is that this provision gives Congress an opportunity 

to evaluate new information such as the actions of other nations or new scientific, 

technological, or economic developments that might affect future emissions goals, 

price caps, or other design elements of the program. It seems quite consistent with 

the routine Congressional reviews conducted in other policy areas. The uncertainties 

inherent in future energy markets, climate science, and prospect of future climate 

policies of one kind or another—with or without adoption of the Bingaman amendment—are likely to dominate any economic or financial assessment of refineries or 

other energy facilities. 

Question 2. Do I correctly understand that the so-called safety valve or cost cap 

provisions in the National Commission on Energy Policy proposal and Bingaman 

legislation provide for economic certainty, but not environmental certainty. Can you 

explain how that works? 

Answer. The safety valve or price cap is, in effect, a type of insurance policy designed to protect the economy against unexpected price increases caused by weather, stronger than predicted economic growth, technology failures, or other factors. 

Despite the success of the cap and trade provision in the acid rain program, which 

lacks a safety valve, problems have arisen in other programs. For example, during 

the California energy crisis the price of nitrogen oxide (NOX) permits rose to 

$80,000 and, more recently, in the early phase of the EU trading system, prices 

have fluctuated between 8-30 Euros for carbon dioxide (CO2) permits. 

Differences among forecasters have plagued previous policy proposals to reduce 

GHGs. President Clinton’s Council of Economic Advisers forecasted allowance prices 

below $8/ton of CO2 compared to the Energy Information Administration’s (EIA) estimate of $43. With a safety valve, emissions estimates may vary but costs cannot 

rise above the established price cap. Recent EIA sensitivity analyses confirm this 

point, as they found compliance costs to be virtually invariant with respect to a wide 

range of assumptions about natural gas supplies, the availability of non-carbon offsets, and other factors. 

The safety valve differs in a few important respects from a well-known provision 

in the 1990 Clean Air Act Amendments that establishes a $2,000-per-ton penalty 

(1990$) for violations of the stipulated sulphur dioxide (SO2) emissions standards. 

Since the Clean Air Act penalty is far above the expected marginal control cost, it 

has a very low probability of being invoked. In contrast, the proposed safety valve 

price reflects the society’s willingness to pay for carbon mitigation and is not inVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00195 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
192

tended strictly as a punitive measure. For those who believe that the costs of reducing greenhouse gas emissions are relatively low, permit prices would never reach 

the trigger level and emissions would remain capped. 

Question 3. Emission trading programs have been highly successful in phasing out 

leaded gasoline and CFCs, and most notably in reducing emissions of S02 and NOX

through the Acid Rain trading program. Is emission trading a good policy instrument for addressing climate change? Why or why not? 

Answer. I believe that a market mechanism like emissions trading is an excellent 

policy tool for addressing climate change. Introduction of an emissions trading program would have two distinct effects. It would create incentives to reduce emissions 

in the near term, thus mitigating environmental damages associated with those 

emissions. And, at the same time, it would alter incentives for the private sector 

to develop and adopt new technologies. While these same effects would occur under 

a carbon tax regime as well, an emissions trading system does not oblige the private 

sector to make payments directly to the government and, correspondingly, obviates 

the need of the government to make decisions about how best to recycle the funds. 

As noted in the response to question two, inclusion of a safety valve would protect 

the economy against unexpected price increases caused by weather, stronger-thanpredicted economic growth, technology failures, or other factors. 

Question 4. The United States spends a significant amount of money on R&D into 

non-carbon and low-carbon technologies. How does this amount compare to our overall economy, our total spending on energy, and our total greenhouse gas emissions? 

Are other countries spending comparable amounts based on their size and emission 

levels? 

Answer. Various U.S. and foreign government agencies report information relevant to this question. In the following paragraphs, I have summarized the most 

relevant and recent information and also provided references for future follow-up. 

For each of the past three years, the U.S. Office of Management and Budget 

(OMB) has issued a report to Congress entitled Federal Climate Change Expenditures, which details federal spending on programs and tax proposals related to climate change. Table 1 provides a summary of spending for these programs from 2002 

through 2006. The proposed 2006 budget indicates that approximately $4.7 billion 

will be spent on R&D (this number was calculated by adding the total budgets for 

the Climate Change Science and Technology Programs. Table 1 also shows that over 

the past few years total spending on the Climate Change Science Program has decreased slightly. In addition for the 2006 fiscal year, there is a small reduction in 

spending is proposed in the Climate Change Technology Program, relative to the enacted 2005 budget. Overall, federal climate change expenditures have increased, but 

this is largely due to the increase in spending on energy tax incentive proposals (For 

further information about the breakdown of climate change spending, by department, see Appendix B of OMB 2005).

Table 1.—SUMMARY OF FEDERAL CLIMATE CHANGE EXPENDITURES ON 

PROGRAMS AND TAX PROPOSALS RELATED TO CLIMATE CHANGE, FY 

2006 PRESIDENT’S BUDGET 

[Discretionary budget authority and tax proposals in millions of dollars] 

FY 

2002 

Actual 

FY 

2003 

Enacted 

FY 

2004 

Actual 

FY 

2005 

Enacted 

FY 2006 

Proposed 

$ Change 

2006-

2005

Climate Change Science Program (CCSP) 

U.S. Global Change Research 

Program ................................ 1,667 1,722 1,803 1,700 1,711 11 

Climate Change Research Initiative .................................... 42 173 217 181 ¥36

Subtotal—CCSP1 .............. 1,667 1,764 1,976 1,918 1,892 ¥26

Climate Change Technology Program (CCTP) 

Department of Agriculture ...... 3 39 45 48 35 ¥13

Department of Commerce ....... 28 30 7 ¥22

Department of Defense ........... 51 75 60 ¥15

Department of Energy ............. 1,519 1,583 2,390 2,505 2,506 1

Department of the Interior ..... 1 2 2 0

Department of Transportation 5 1 2 1

Environmental Protection 

Agency ................................... 115 106 110 109 113 4

National Aeronautics and 

Space Administration .......... 227 208 128 ¥80 

193

Table 1.—SUMMARY OF FEDERAL CLIMATE CHANGE EXPENDITURES ON 

PROGRAMS AND TAX PROPOSALS RELATED TO CLIMATE CHANGE, FY 

2006 PRESIDENT’S BUDGET—Continued

[Discretionary budget authority and tax proposals in millions of dollars] 

FY 

2002 

Actual 

FY 

2003 

Enacted 

FY 

2004 

Actual 

FY 

2005 

Enacted 

FY 2006 

Proposed 

$ Change 

2006-

2005

National Science Foundation .. 11 11 11 1

Subtotal—CCTP1 .............. 1,637 1,728 2,868 2,989 2,865 ¥124

International Assistance 

U.S. Agency for International 

Development ......................... 174 214 195 189 162 ¥27 

Department of State ................ 7 6 5 6 11 5

Department of the Treasury2 43 56 52 45 25 ¥20

Subtotal International Assistance .......................... 224 276 252 240 198 ¥42 

Energy Tax Incentive Proposals That Reduce Greenhouse Gases3 ........................ 0 0 0 83 524 441

Total1 4 ....................... 3,522 3,762 5,090 5,223 5,473 250

1Subtotals and table total may not add due to rounding. Subtotals and totals supersede numbers released with the President’s 2006 Budget. Discrepancies resulted from rounding and improved estimates. 2The FY 2004 and FY 2005 enacted level for the Tropical Forestry Conservation Act (TFCA) 

is $20 million each year. In FY 2006, the Administration has requested a total of $99.8 million 

for debt restructuring programs to be available for: bilateral Heavily Indebted Poor Countries 

(HIPC) and poorest country debt reduction, contributions to the HIPC Trust Fund, and TFCA 

debt reduction. The Budget provides the Treasury Department flexibility in determining the 

amount for each program. The FY 2006 funding level for TFCA has not been determined yet. 3The cost of the four energy tax incentives related to climate change included in the President’s FY 2006 Budget is $3.6 billion over five years (2006-2010). 4The International Assistance subtotal contains funds that are also counted in the Climate 

Change Science Program subtotal. Table total line excludes this double-count. 

Source: Adapted from OMB 2003, and 2005. 

In its Annual Energy Review EIA provides information on energy consumption, 

energy expenditure, and emissions in relation to GDP. The most recent EIA calculations on energy expenditures show that in 2001 the United States spent $693.6 billion on energy (nominal dollars, EIA 2004). This amount was 6.8 percent of the GDP 

that year (ETA 2004). In 2002, OMB reports that $3.3 billion was spent on the Climate Change Science and Technology programs, which is 0.03 percent of the 2002 

GDP (ETA 2004; OMB 2003). 

Greenhouse gas emissions were estimated to be 6,828.9 million metric tons of carbon dioxide equivalents in 2001 and 6,862.0 million metric tons of carbon dioxide 

equivalents in 2002, an increase of 0.5 percent (EIA 2003). EIA also provides estimates of greenhouse gas emissions relative to GDP. In 2001, greenhouse gas emissions were 691 metric tons of carbon dioxide equivalent per million (2000 chained) 

dollars (EIA 2004). In 2002, this number decreased to 684 metric tons of carbon dioxide equivalent per million (2000 chained) dollars (EIA 2004). 

While I am more familiar with U.S. spending and greenhouse gas data, I was able 

to find some information on foreign spending on climate change and greenhouse gas 

emissions. The European Environment Agency (EEA) reported that the EU-15 emitted 4,180 million metric tons of CO2 equivalents in 2003 (EEA 2005). Table 2 provides the breakdown of emissions by country. EEA also reported that it spent 

831,000 Euros, or $ 934,758 (converted using OECD’s Purchasing Power Parity for 

2004) on ‘‘tackling climate change’’ in 2004 (EEA 2004). 

Britain’s Department for Environment, Food, and Rural Affairs reports that the 

government funded an λ11.5 million research program in 2000-2001 in order ‘‘to 

improve... understanding of the science and impacts of climate change, to quantify the UK’s emissions of greenhouse gases, and to inform policies on reducing 

emissions’’ (DEFRA 2001). This amount is equal to approximately $18.5 million 

(2001 dollars, converted using Purchasing Power Parity). 

A list of sources is presented below: 

DEFRA. 2001. Climate Change UK Programme. Available at http://

www.defra.gov.uk/environment/climatechange/cm4913/4913html/index.htm. Last 

accessed Oct. 2005. 

194

EEA. 2004. Annual Report 2004. Available at http://reports.eea.eu.int/reportl2004l0622l154840/en/Annual-report-FINALlweb.pdf. Last accessed Oct. 

2005. 

EEA. 2005. European Community Greenhouse Gas Emission Trends. Available at 

http://reports.eea.eu.int/technicallreportl2005l4/en/

EClGHGlInventorylreportl2005.pdf. Last accessed Oct. 2005. 

EIA. 2003. Emissions of Greenhouse Gases in the United States 2002. Report #: 

DOE/EIA-0573(2002/ES). Available at http://www.eia.doe.gov/oiaf/1605/gg03rpt/

summary/index.html. Last accessed Oct. 2005. 

EIA. 2004. Annual Energy Review 2004, Report No. DOE/EIA-0384(2004). Available at http://www.eia.doe.gov/emeu/aer/contents.html. Last accessed Oct. 2005. 

(Table available at http://www.eia.doe.gov/emeu/aer/txt/ptb0105.html) 

OECD. 2005. Purchasing Power Parities. Available at www.oecd.org/dataoecd/

61/54/18598754.pdf. Last accessed Oct. 2005. 

OMB. 2003. Federal Climate Change Expenditures, Report to Congress. Available 

at http://www.whitehouse.gov/omb/legislative/fy04lclimatelchglrpt.pdf. Last 

accessed Oct. 2005

OMB. 2005. Federal Climate Change Expenditures, Report to Congress. Available 

at http://www.whitehouse.gov/omb/legislative/fy06lclimatelchangelrpt.pdf. 

Last accessed Oct. 2005

195

Table 2.—OVERVIEW OF MEMBER STATES’ CONTRIBUTIONS TO EC GHG EMISSIONS EXCLUDING LUCF FROM 1990 

TO 2003 IN CO2 EQUIVALENTS (TG) 

Member State 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

Austria ................................... 79 83 76 76 77 80 83 83 83 80 81 85 86 92Belgium ................................. 146 149 147 146 151 152 157 148 153 146 148 147 145 148Cyprus ................................... 6 6 7 7 7 7 8 8 8 8 9 8 9 9Czech Republic ...................... 192 178 164 158 152 153 155 159 149 140 148 148 143 145Denmark ................................ 69 80 74 76 80 77 90 80 76 73 68 70 69 74Estonia ................................... 43 41 30 23 24 22 23 24 22 20 20 19 20 21Finland .................................. 70 69 67 68 74 71 77 76 73 72 70 76 77 86France .................................... 568 593 585 559 555 563 578 572 584 566 560 564 554 557Germany ................................ 1,244 1,191 1,142 1,126 1,108 1,103 1,121 1,084 1,057 1,021 1,017 1,028 1,015 1,018Greece .................................... 109 109 110 110 113 114 118 123 128 127 132 134 134 138Hungary ................................. 103 95 85 85 85 84 86 84 84 84 81 84 81 83Ireland ................................... 54 55 56 56 57 58 60 63 65 67 69 71 69 68Italy ....................................... 511 513 509 505 496 528 519 525 535 544 551 556 555 570Latvia .................................... 25 24 19 16 15 12 12 12 11 10 10 11 11 11Lithuania ............................... 51 45 42 38 35 31 28 24 22 21 21 20 20 17Luxembourg .......................... 13 13 13 13 13 10 10 9 8 9 10 10 11 11Malta ..................................... 2 2 3 3 3 3 3 3 3 3 3 3 3 3Netherlands ........................... 212 216 215 221 221 224 233 225 227 215 214 216 213 215Poland .................................... 460 438 440 430 440 417 437 427 404 402 386 383 370 384Portugal ................................. 59 61 65 64 65 70 67 70 75 83 80 81 86 81Slovakia ................................. 72 63 59 55 52 53 54 54 52 51 48 53 52 52Slovenia ................................. 19 17 17 18 18 19 19 20 20 19 19 20 20 20Spain ...................................... 284 290 299 287 303 315 307 328 337 365 380 379 399 402Sweden .................................. 72 72 72 72 75 73 77 73 73 70 67 68 69 71United Kingdom .................... 748 752 729 710 700 691 714 691 686 652 652 663 644 651EU-25 ..................................... 5,212 5,156 5,023 4,919 4,917 4,931 5,036 4,964 4,935 4,849 4,844 4,894 4,852 4,925EU-15 ..................................... 4,238 4,246 4,159 4,087 4,088 4,129 4,211 4,150 4,160 4,091 4,100 4,146 4,126 4,180

Source: EEA 2005

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Question 5. You seem to agree that the most important long-term feature of any 

climate policy is the impact it will have on investment in R&D and the development 

of new, carbon-free technologies in both the private and public sectors. What do you 

believe are the best policies for pursuing needed R&D? Should these R&D initiatives 

be primarily taxpayer funded, government R&D programs, or should we pursue policies to provide incentives for private-sector R&D? 

Answer. Few would disagree that the private sector, not the government, has 

driven innovation and growth in the modern economy. For example, according to the 

National Science Foundation, in 2003 industry (not government) funded almost twothirds of all R&D in the United States. 

It is also widely recognized that government has an important role to play in 

spurring the development and diffusion of these technologies. Without some kind of 

additional incentives, the private sector typically will under-invest in research, development, and demonstration because innovators cannot reap the full benefits to 

society of their advances. The existence of these ‘‘spillovers’’ reduces private incentive to pursue innovation, as others will mimic the innovation without compensating 

the inventors. While patents and similar means are used to protect investments in 

innovation, that protection is limited. A successful innovator typically captures substantial rewards, but those gains are sometimes only a fraction of the total benefits 

to society arising from the innovation. This rationale underlies government support 

of research, development, and demonstration programs, including the National 

Science Foundation, public universities, and other research institutions. 

Environmental and knowledge externalities have long been at the center of debates about technology policy. More recently, we have come to understand some additional market failures that may operate in the adoption and diffusion of new technologies. For a variety of reasons, the cost or value of a new technology to one user 

may depend on how many other users have adopted the technology. Generally 

speaking, users will be better off the more others use that same technology, as this 

increases what is known as ‘‘learning by doing’’ and ‘‘network’’ externalities. Typically, it takes time for potential users to learn of a new technology, try it, adapt 

it to their particular circumstances, and become convinced of its superiority. Consequently, the early adopter of a new technology creates a positive benefit for others 

by generating information about the existence, characteristics, and likely success of 

the new technology. 

The argument for public support is even stronger in the case of climate change 

technologies, where not only do inventors fail to capture all the gains from their investments but the gains themselves are not fully translated to the firms’ bottom line 

because there is no market value associated with emissions reductions. Further, the 

prospect of future value—which is driven by policy outcomes—is uncertain. 

Absent government incentives, corporate concern for the environment may overcome some hurdles. Working against this kind of ‘‘corporate altruism,’’ however, is 

the need to compete in the marketplace. A company that puts meaningful effort into 

reducing greenhouse gas emissions, rather than reducing costs, may eventually lose 

out to one that only seeks to reduce costs. 

It is exactly this need to align public and private interests that underlies the argument for an emissions trading program, or similar mechanism, alongside technology development and demonstration programs. While the government seeks technologies to cut carbon emissions, the private sector seeks technologies to cut costs. 

Market-based policies that put a value on emissions reductions encourage firms to 

conserve energy, reduce emissions from existing technologies, and adopt new lowcarbon or no-carbon technologies. In contrast, policies that only focus on technology 

adoption fail to take advantage of reductions that could come from existing technologies and conservation. 

Question 6. Roughly how large an R&D investment do you believe is needed at 

this time, given that radically new technologies will be required in the future to address climate change? Are current energy R&D funding levels adequate, or do you 

think additional resources are required? 

Answer. It is difficult to judge the ‘‘optimal’’ funding level for R&D. As noted in 

the response to question number 4, OMB reports proposed 2006 budgets for climate 

change science and climate change technology of $1,892 and $2,865, respectively. 

The NCEP proposal would approximately double the spending levels on the climate 

change technology program over a 10-year period. While still higher levels may be 

justified, an equally important issue concerns the mechanism used to fund the R&D. 

Recognizing that funding of R&D has a somewhat checkered past, due partly to a 

large (and growing) degree of congressional earmarking and annual funding fluctuations, it is important that the designated funds be subject to an independent, 

multiyear, integrated planning process. Ideally, an independent group or commission assembled for this purpose would have, as its goal, the best allocation of R&D 

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1For further discussion of how this process might work, see Kopp, Raymond J., Richard D. 

Morgenstern, Richard G. Newell and William A. Pizer, ‘‘Stimulating Technology to Slow Climate 

Change,’’ in New Approaches on Energy and the Environment, (Morgenstern and Portney, editors), RFF Press, 2004. 2Pizer, William 2000. ‘‘The Case for Intensity Targets,’’ Discussion Paper 05-02, Resources for 

the Future, Washington, D.C. (forthcoming in Climate Policy). 

funds for long-term, cost-effective climate mitigation and would include experts from 

government, private industry, and academia.1

Question 7. What are the advantages and disadvantages of using intensity-based 

emission targets? 

Emissions intensity targets focus on emissions per dollar of real GDP, rather than 

on the absolute level of emissions. In my view, a key advantage of intensity-based 

targets is that they help shift the debate away from measuring progress strictly in 

terms of zero or negative growth in emissions as a near-term goal, which is an unrealistic objective for a growing economy like that of the United States. In contrast, 

emissions-intensity frameworks start out with the more achievable goal of slowing 

the rate of emissions growth. Especially as nations are just beginning to implement 

mandatory emission reduction programs, such a formulation is more pragmatic. Another advantage of intensity targets is that they promote an emphasis on progress 

rather than simply on the absolute status of one nation versus another, which could 

help ease some of the concerns about equity among nations. A further advantage 

of intensity-based targets is that developing nations often appear favorably in such 

calculations as they are reaping the natural declines arising from modernization. 

This could facilitate the entry of developing nations into meaningful initial commitments. 

That said, intensity targets also have a number of disadvantages. First, they are 

harder to convey to the public than a simple emission cap. Second, the main advantage of intensity targets—that they do not draw attention to zero growth as a benchmark for progress—will be seen as a disadvantage by advocates who seek such a 

benchmark. 

A final observation is that intensity targets are not a useful way to deal with economic shocks that make the cost of any emission limit uncertain. Other mechanisms, such as safety valves, can better address this problem, as discussed in the 

response to question 3. A fuller discussion of intensity targets can be found in a recent paper by my RFF colleague, William Pizer.2

Question 8. What are your views on setting up a trust fund with the proceeds 

from a cap and trade program and using the revenue to fund investment in lowemission energy technologies? 

Answer. While trust funds are sometimes pilloried as ‘‘lock boxes’’ that distort national spending priorities, the requirements of science and technology programs for 

long-term, stable funding mitigates against such concerns. The fact that the revenues for the trust fund would be derived from hitherto-untapped sources closely tied 

to the goals of the R&D programs also addresses these concerns. On balance, I think 

there is a good case for setting up a trust fund with the proceeds from a cap and 

trade program and using the revenue to fund investment in low-emission energy 

technologies. 

Question 9. Please comment on your view of success of EU program and what we 

can learn as we move forward in the United States. 

Answer. The European Union Emissions Trading System (EU-ETS) is a major environmental policy, representing the world’s first large-scale greenhouse gas trading 

program. It covers more than 11,000 facilities in 25 countries and 6 major industrial 

sectors. The first stage of the program is now in operation, covering CO2 emissions 

only. National allocation plans have been approved in all nations, although registries in all nations are not yet fully operational. Protocols have been established 

for uniform monitoring of emissions. Allowances equal to monitored emissions must 

be surrendered on an annual basis, beginning at the end of this year. Beginning in 

2008, the system will be expanded to include additional sectors and additional 

greenhouse gases. Significant trading volumes are already occurring, mostly in the 

power sector, and the system seems poised to deliver real but modest reductions 

compared to a business-as-usual scenario. Possible lessons for the United States can 

be drawn from the early experiences of the EU-ETS:

• The price of allowances has fluctuated considerably (8-29 Euros) since the beginning of the program in January 2005. Some of the fluctuations are clearly 

associated with weather and fuel-price dynamics. Many observers believe that 

over the longer term prices will decline as the early growing pains of the program are resolved and, particularly, as more eastern European nations establish registries and enter the market more actively. Had the EU-ETS adopted 

198

a safety valve at a level consistent with the long-term price expectation, as has 

been widely discussed in the United States, some of the extreme price fluctuations would have been avoided. 

• The EU-ETS covers less than 50 percent of the total EU emissions; consequently, the success of the trading program does not imply that the EU will 

meet its overall emissions targets under the Kyoto Protocol. Rather, achievement of the Kyoto target depends partly on the success of various regulatory 

and voluntary programs in place in other sectors of the economy, plus the success of governments in purchasing allowances from Russia or other Annex B nations, or through the Clean Development Mechanism. Recent discussions in the 

United States have focused on economy-wide or near economy-wide systems 

that, by definition, would not have the same type of problems. 

• Because the EU-ETS is based on the operation of a series of national-based institutions throughout the EU, problems in individual nations can affect the 

prices and availability of allowances elsewhere. The fact that the registries in 

some nations are not yet operational, particularly in Eastern Europe where net 

selling is expected, means that the market remains thin and sensitive to single 

trades. The same problems are not likely to occur in the United States, where 

discussions have focused on a market entirely organized at the national level.

Question 10. It is sometime said that using a safety valve is the same as adopting 

a carbon tax. Please explain why you agree or disagree. 

Answer. Some, in opposing a safety valve try to smear it by calling it a disguised 

tax. In this regard, I would make two points: first, if the price cap level is not 

reached, then it is strictly a cap-and-trade mechanism, just like the acid rain program and not at all like a tax. Second, even if the price cap level is reached, only 

a small portion of the revenues would accrue to the government, in this case to fund 

research and development. The bulk of the revenues would flow directly back to the 

private sector. Because a tax is principally defined in terms of the revenues it generates, and since only a small portion of the revenues ever end up in the hands of 

the government, it is not accurate to describe the safety valve as a tax. 

RESPONSES OF RICHARD D. MORGENSTERN TO QUESTIONS FROM SENATOR AKAKA

Question 1. I have some questions about the carbon-trading program in the European Union.

• We know that Europe has started a carbon-trading program. Can you please describe the basics of what is happening there? How is the carbon traded, capital 

generated, and who receives the benefits? 

• Second, what is the outlook for success in this trading program? 

• Finally, what are the lessons for the U.S. from Europe’s experience? Has there 

been widespread unemployment or lack of economic growth?

Answer. Please see the answers to Senator Bingaman’s question number 9. 

Question 2. From your testimony, it sounds like the National Commission on Energy Policy proposal would have a very small impact on the U.S. economy overall. 

Further, it will not ‘‘avert’’ climate change over the next 20 years. However, you apparently believe that it is very important to undertake something like the NCEP 

proposal. Can you explain a little more why it is so important if we aren’t having 

an effect on climate change? 

Answer. The principal reason that NCEP’s approach would have a much smaller 

impact on the U.S. economy than the Kyoto Protocol or S. 139 is that, fundamentally it is not designed to avert climate change over the next 20 years. Rather, the 

focus is on developing and deploying technologies needed to address the problem in 

the decades beyond. The NCEP proposal does this primarily in two ways: 1) by directly subsidizing a wide range of new technologies including coal, nuclear, fuel-efficient vehicles, biofuels, and others; and 2) by encouraging private-sector research 

and development through incentives for the deployment of cost-effective carbon saving technologies of all types. NCEP’s cap-and-trade system has the added benefit of 

generating a revenue stream to fund the technology subsidies. 

The NCEP strategy recognizes that large-scale emission reductions in the near 

term are not a prerequisite to long-term success of the overall mitigation strategy. 

Unlike SO2, lead, or other pollutants with short-term health impacts, the damages 

associated with climate change are primarily long term in nature. The mitigation 

strategy used to address the issue needs to reflect that understanding of the problem. 

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RESPONSES OF RICHARD D. MORGENSTERN TO QUESTIONS FROM SENATOR FEINSTEIN

Question 1. Under the National Commission on Energy Policy’s proposal, what 

happens when a covered entity uses the safety valve rather than lowering emissions? What is done to ensure that emissions are actually reduced? 

Answer. An economic-based measure such as a cap-and-trade system provides incentives for industry, consumers, and governments to reduce their emissions. Such 

incentives have been proven successful in the SO2 trading program and elsewhere 

in the United States and abroad. A safety valve is designed to protect the economy 

against unexpected price increases caused by weather, stronger than predicted economic growth, technology failures, or other factors. 

If the goal is to reduce emissions in the near term without regard for the economic 

consequences, then a safety valve is not necessary. However, if the goal is to address 

the long-term build up of greenhouse gases in the atmosphere without imposing 

undue economic harm, then the safety valve is an appropriate mechanism. 

Question 2. Under the Commission’s proposal, a company could pay the $7/ton fee 

instead of reducing the greenhouse gases. So, in the end, is there really a firm cap 

on emissions? 

Answer. The $7/ton charge creates incentives for all sources to undertake emission reductions up to the point where mitigation costs reach that level. With such 

a scheme in place, more expensive mitigation activities would not likely be undertaken. 

Question 3. What policy solutions do you recommend to correct for this so we can 

still make environmental progress? 

Answer. The answer depends in large part on how one defines ‘‘progress.’’ In my 

view, the creation of incentives to develop and deploy new technologies, combined 

with incentives to undertake low-cost emission reductions in the near term, would 

represent real progress on the climate change issue. I believe that zero or negative 

emissions growth in the near term is not a realistic definition of progress for a growing economy like that of the United States. 

Question 4. Has anyone looked at the cost of inaction—in other words, what the 

impact will be to the economy to not curb emissions? I’m thinking specifically of 

costs related to:

• health care due to dirtier air, 

• insurance costs due to more intense storms, 

• government emergency relief services, 

• the costs of alternative sources of water in the west as the snowpack decreases, 

• the costs of protecting homes, businesses and highways from rising sea levels, 

• farm payments due to decreased agriculture output, and 

• what the potential impact all of those increased costs will have on economic 

growth.

Answer. There is a large and growing literature on the impacts of climate change. 

I would refer you to the extensive studies published by the Intergovernmental Panel 

on Climate Change (IPCC), as well as those published by the U.S. EPA. 

RESPONSE OF RICHARD D. MORGENSTERN TO QUESTION FROM SENATOR CORZINE

Question 1. A cap-and-trade policy is widely acknowledged as a mechanism that 

encourages industry to find the most cost-effective opportunities to meet a specific 

policy goal. It gives companies the flexibility to decide what types of actions and 

technologies work best for them. It is also widely acknowledged that improvements 

in other areas such as fuel efficiency would also have a significant impact on reducing greenhouse gas emissions, reducing air pollution, and increasing our energy 

independence. Wouldn’t the reduction in greenhouse gas emissions be that much 

greater if we coupled a cap-and-trade policy with stricter CAFE standards? 

Answer. It is true that short of very strict limits on emissions which, in turn, 

would lead to sharp increases in the price of gasoline and other carbon-based fuels, 

the emission reductions from automobiles under a cap and trade program of the 

type proposed by the NCEP are likely to be quite modest. Non-price measures clearly have a role to play in this sector. As currently designed, however, CAFE standards have some well-documented problems. Other program designs might be more 

effective in achieving mobile-source emission reductions with fewer unintended side 

effects. 

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RESPONSES OF ANNE E. SMITH TO QUESTIONS FROM SENATOR BINGAMAN

Question 1. Do you believe that climate change is linked to anthropogenic emissions? 

Answer. I think there is enough evidence to warrant climate change risk management. My testimony outlined my thoughts on the key elements of such risk management. 

Question 2. In your written testimony, you state that ‘‘a price on carbon in the 

near-term can be justified as a supplement to a meaningful R&D mission once that 

mission has clearly defined targets for success.’’ and that ‘‘only government can provide the needed R&D investment.’’

Question 2a. What are your thoughts on how those long-term targets should be 

developed and, based on the targets, (i) what near-term carbon price would you suggest is reasonable and (ii) what level of funding would support a ‘‘meaningful’’ R&D 

program that would support these goals? 

Answer. The nation needs to engage in a direct discussion of how to create an 

effective R&D program and what that program should strive to accomplish. The latter is what I mean by ‘‘targets for success.’’ I, myself am just beginning to think 

about how one might put this together, but here are some initial thoughts that 

might help start a discussion. One important question is ‘‘What would the nation 

be willing to pay to achieve a zero-emissions energy system?’’ The current cost of 

a global zero-emission system is patently not acceptable. It also appears that lithe 

added cost of achieving a zero net GHG world were only a few percent of our current 

costs of energy, the nation might be willing to accept this cost to reduce climate 

change risk. Unfortunately, the latter situation is not a real choice at present, and 

no set of technology forecasts suggests that this will be possible even over the next 

30 years. However, there might be some higher cost that we still would accept at 

some point in the future if, from that point on, it were to provide meaningful reductions in GHG emissions. The important question is whether this acceptable cost has 

any overlap with the costs that might be technologically achievable in the coming 

century with a concerted and focused R&D program. 

The acceptable cost could be seen as a ‘‘stretch goal ‘‘ for the R&D program. Setting such a goal is fundamentally a political process as it requires that uncertain 

risks of climate change be balanced against the more certain costs to our economy 

of using such future technologies on a scale that could actually stabilize atmospheric 

emissions. Economics might help inform a rational trade-off, but the stakes and associated uncertainties are so pronounced that the final choice for a cost goal depends 

on much broader social considerations. 

Once the stretch goal for the R&D program has been articulated, then one can 

start to estimate reasonable levels of spending on near-term emissions reductions 

and the magnitude of the R&D task. 

(i) A reasonable near-term carbon price would be the present value of the stretch 

goal for the future cost that we determine we are willing to accept for a zero-emissions economy. Calculating that present value is simple if one knows the future ‘‘acceptable’’ cost-per-ton that is the R&D goal, and the associated date of availability. 

Footnote 1 of my written testimony provided an illustrative example of such a calculation. It was illustrative because we currently lack both a national view of an 

‘‘acceptable cost ‘‘ for achieving zero net emissions, and an R&D program that offers 

a plan and target time period for deployment. 

(ii) The level of funding for the R&D program would be determined by a process 

of identing the types of breakthroughs necessary to achieve the stretch goal. Once 

these R&D milestones have been identified, it will be more possible to discuss an 

appropriate scale and form for the R&D program, which in turn will identify the 

appropriate spending, and ramp-up rates for such spending. 

Question 2b. How much do you expect this to cost the government? 

Answer. See my reply to 2a(ii) above. 

Question 2c. How much do you think the government would actually spend? 

Answer. If an R&D program were to be developed that has a clearly articulated 

vision of what its targeted outcomes are, is founded on a political consensus that 

such outcomes would enable a national response to reduce emissions on a scale sufficient to meaningfully reduce risks of climate change, and with a coherent plan for 

how to make progress towards its defined goal, then it is likely that the government 

could agree on the spending necessary to fulfill the plan. 

Question 2d. You said in your testimony that the difficult decisions are how much 

to spend now, and how to design programs to stimulate R&D that avoid mistakes 

of the past. Can you share your recommendations? 

Answer. Designing a truly effective R&D program is clearly a major challenge yet 

it has not received even a modest amount of attention among climate policy anaVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00204 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
201

lysts. My recommendation is that the community of environmental policy analysts 

immediately strive to shift their attention away from their traditional focus on devising efficient regulatory structures and focus it on the challenge of devising effective R&D programs. An intellectual cross-fertilization is needed between environmental economists and economists who have studied R&D processes. I am not saying that R&D should be solely a job for government. As I stated in my testimony, 

the objective should be to design a set of incentives that can shift private sector 

R&D in the direction of producing the needed advances for climate technology. 

Question 3. You say that we need to develop ‘‘breakthrough’’ technologies, and 

that once they are developed we can make massive emissions cuts. You seem to acknowledge that this may still be ‘‘quite costly’’. 

Question 3a. How many greenhouse gas emissions do you expect will be released 

between now and when these ‘‘breakthrough’’ technologies are developed and then 

deployed? 

Answer. The quantity of GHG emissions that will be released over the next several decades will depend, at the margin, on the costliness of policies that are enacted around the world, and also on whether developing nations become engaged in 

any effort. However, under any scenario, we can expect that atmospheric concentrations will continue to rise until zero-emissions technologies start to be deployed on 

a global scale. 

Question 3b. How certain are you that these ‘‘breakthrough’’ technologies will be 

created? 

Answer. The likelihood of success depends on national and international efforts 

to identify the necessary component breakthroughs, and to create the programs that 

will help make them possible. Lack of such efforts reduces the likelihood that they 

will be created. 

Question 3c. What if we fail to develop them? 

Answer. If lower-cost zero-emissions technologies are not developed, then the 

world’s economies will probably continue to emit GHGs at a rate that causes atmospheric concentrations to continue to grow. 

Question 3d. Would you expect massive emission cuts by deploying the ‘‘breakthrough’’ technologies to lead to massive fuel switching from coal and other resources? 

Answer. I have no idea. 

Question 4. In your analysis of the NCEP proposal, how much money did you determine would be generated by the sale of allowances due to the auction and safety 

valve? 

Answer. My testimony reported our analysis of the cap-and-trade portion of the 

Bingaman Amendment. We estimated a range of prices and emissions outcomes. 

Our estimates of revenues from the auction plus the safety valve sales (in 2005 constant dollars) are:

2010—$1 to 2 billion 

2015—$2 to 3 billion 

2020—$4 to 7 billion 

2025—$5 to 12 billion 

2030—$7 to 17 billion

The lower bound reflects just auction revenues, because our low case does not 

trigger any safety valve sales through 2030. Most of the difference between the 

lower bound and upper bound for 2020-2030 reflects revenues from safety valve 

sales. 

Our analysis did not include the impact of the CAFE provisions. The CAFE standard would reduce the government revenue estimates, especially at the upper end of 

the range, while increasing the overall social costs of the program. 

Question 5. According to NCEP recommendations, these revenues would then get 

redirected back into near term low carbon technology deployment programs (such 

as advanced nuclear, biomass, and coal with sequestration) as well as doubling basic 

energy R&D funds for the long term. In such a scheme, as the difficulty of the goals 

increased with the rise in the safety valve price, the funds going into technology innovation would also likewise increase. In your testimony, you indicate that the 

NCEP/Bingaman Amendment energy innovation funds are inadequate for the task 

at hand. How much more public money do you suggest be dedicated to energy research and development? How should these activities be funded? 

Answer. My testimony related to the Bingaman Amendment as written, and did 

not relate to any provisions or recommendations in the NCEP proposal that were 

not reflected in the Bingaman Amendment. I did wish to suggest that current R&D 

spending was inadequate for the task at hand; rather, I argued that the nation is 

lacking a clearly targeted and carefully planned R&D program to develop much 

202

lower cost options for a zero-emissions economy, and that the Bingaman Amendment would not help fill this gap. I argued that subsidies increased the cost that 

we will spend on near-term technologies to a level above that implied by the safety 

valve, which is inappropriate if the safety valve represents the maximum that we 

should be spending today on near-term reductions. I also argued that spending on 

subsidies did not constitute spending on R&D. 

See my reply to question 2a(ii) regarding my thoughts on how to determine how 

much public money should be dedicated to energy R&D. Once appropriate funding 

levels have been determined, I feel that it is up to the Congress to determine how 

to raise the funds. I stated in my testimony that I do not think that the funds 

should come solely from a carbon tax allowance auction, or safety valve sales. Such 

revenue sources might generate either too little revenue or too much revenue to 

serve a well-targeted and well planned R&D program, and so they should not be 

formally linked to each other. Additionally, I do not recommend that a carbon tax 

rate or safety valve price be chosen based on R&D spending needs; the appropriate 

level should be based on considerations such as I outlined in my reply to question 

2a(i). 

Question 6. What are the advantages and disadvantages of using intensity-based 

emission targets? 

Answer. I see no particular advantages or disadvantages of basing a cap-andtrade program on intensity-based emission targets. The only merit of the concept is 

that it has enabled the nation to recognize that a ‘‘cap’’ might allow for emissions 

to increase from where they are today, yet still impose a real cost on the economy, 

and require concerted effort to achieve. However, as implemented in the NCEP proposal and the Bingaman Amendment, it is still a cap, with attending concerns about 

cost uncertainty and variability. More importantly, the cap in these two proposals, 

whether intensity-based or not, is rendered almost completely irrelevant by the safety valve provision, which converts the ‘‘cap’’ into an effective tax. 

Question 7. What are your views on setting up a trust fund with the proceeds 

from a cap and trade program and using the revenue to fund investment in low 

emission energy technologies? 

Answer. See the second paragraph of my reply to question 5. 

Question 8. As you know, we are operating under huge budget deficits and, therefore, massive appropriations for R&D are unlikely. Given this context, if the Bingaman proposal was modified to fund ‘‘Long-run, high-risk R&D to produce radically 

new GHG-free energy sources,’’ rather than subsidies for existing technologies, could 

you support it? 

Answer. My replies under questions 2 and 5 above sum up my view of an appropriate set of actions and policies to mitigate climate change risk. That approach is 

fundamentally different from the Bingaman proposal, and it would not be achieved 

by merely changing the earmarking of funds for subsidies to earmarking of funds 

for R&D. First, and foremost, specific national goals for an R&D program must be 

articulated and that important gap would not be filled by simply altering what the 

revenues are earmarked to be used for. Spending on R&D without first determining 

what would constitute ‘‘success ‘‘ and ident0ing how to maximize chances of success 

would probably just be a waste of money. 

My testimony also emphasized that a carbon tax is a simpler and more transparent way of achieving a goal of placing a near-term price on GHG emissions. I 

have also concluded that using CAFE standards, which currently are in the Bingaman proposal, is less cost-effective than using a price signal to drivers of current 

automobile technology combined with a program for the long-run development of a 

future, zero-emitting form of personal transportation. 

Question 9. Under what conditions could you support a carbon tax? 

Answer. See my reply to question 2a(i). 

Question 10. You state that ‘‘the ‘safety valve’ in the NCEP program and Senator 

Bingaman’s amendment is designed to provide assurance that the price of emission 

allowances will not reach economically unsustainable levels. But that policy design 

causes the prices to be set at a level far too low to provide an adequate incentive 

for private investors to develop radically new technologies.’’ Yet earlier you note that 

only a low price would be justified. What price does your analysis suggest would 

be appropriate to encourage private investors to develop radically new technologies 

(a) on their own, and (b) in conjunction with an appropriate R&D program? 

Answer. I conclude that no price signal created by government legislation or regulation can provide the incentives necessary for private investors to develop radically 

new technologies. This is because of a dynamic inconsistency of incentives that is 

the subject of my recent paper with Dr. David Montgomery, and which is described 

in my written testimony on pp. 17-19. Price signals are useful for motivating the 

private sector to deploy technologies that currently exist but which would be more 

203

costly than higher-emitting technologies but for a carbon price that we are willing 

to impose and pay for now. Such price signals might also motivate private entities 

to make some evolutionary improvements on existing technologies that could quickly 

bring them into the cost-effective range defined by a credible and sustainable nearterm carbon price. My thoughts on what that near-term carbon price level might 

be are described in my response to question 2a(i) above. Motivation to develop revo- lutionary technologies, requiring the coordination of a set of many separate scientific 

breakthroughs, must come from other forms of policy than a carbon price signal. 

Their eventual deployment can be motivated by a carbon price signal once the technology has reached the deployment stage, which occurs after the R&D stage. 

RESPONSES OF ANNE E. SMITH TO QUESTIONS FROM SENATOR AKAKA

Question 1. From what you and Dr. Morgenstern state in your testimonies, there 

is virtually no way that the U.S. can do anything that will reverse global warming. 

Even reductions to zero carbon emissions right now will hardly stabilize temperature. 

Answer. Even if the U.S. were to reduce its emissions to zero right now, emissions 

in developing countries would continue unabated and so atmospheric concentrations 

would continue to increase too. Atmospheric stabilization can only be achieved if the 

entire globe moves to zero carbon emissions. This is why it is so important for a 

US policy response to directly address the need for reducing developing country 

emissions and not just focus on reducing US contributions to emissions. 

Question 2. Your testimony emphasizes the importance of investing in R&D for 

technology, particularly ‘‘radically different’’ technologies for limiting carbon emissions. If the nation were to embark on one of the three options in your testimony 

(cap & trade, cost-based, or carbon tax), how do you see economic growth distributed 

in the technology community or the U.S. in general? Which types of business would 

be the winners—where would you expect to see economic investment, jobs, and 

growth? Would it be large coal technologies, for example, or small electronics firms 

or carbon material firms? 

Answer. The ‘‘winners’’ will depend on the focus of the R&D program that I have 

argued should be developed as a first step. I do not know what that focus would 

be. However, I am confident that a sound program will require a diversified approach and that will imply opportunities to contribute to the program will be available in many sectors of the economy. 

RESPONSES OF ANNE E. SMITH TO QUESTIONS FROM SENATOR FEINSTEIN

Question 1. Under the National Commission on Energy Policy’s proposal, what 

happens when a covered entity uses the safety valve rather than lowering emissions? What is done to ensure that emissions are actually reduced? 

Answer. When a covered entity ‘‘uses’’ the safety valve, it pays money to the government equal to the safety valve price in that year times the amount by which its 

actual emissions exceed its holdings of allowances (both allocated allowances and 

those purchased after the allocation). The safety valve therefore does not require 

that emissions are actually reduced; it does however ensure that covered entities 

have a real financial incentive to achieve all the emissions reductions that they can 

find at a cost per ton reduced that is cheaper than the safety valve price. 

Question 2. Under the Commission’s proposal, a company could pay the $7/ton fee 

instead of reducing the greenhouse gases. So, in the end, is there really a firm cap 

on emissions? 

Answer. No, there is not a firm cap on emissions. 

Question 3. What policy solutions do you recommend to correct for this so we can 

still make environmental progress? 

Answer. My written and oral testimonies have consistently recommended that the 

nation develop and implement an effective, long-term R&D program to enable us to 

achieve an affordable, zero net emissions energy system within the century—hopefully starting within the next 30 years. For near-term actions, I have recommended 

that we focus (1) on achieving transfer of current state-of-the-art technologies to developing countries that still investment in less efficient technologies even as they 

grow, and (2) on creating a price signal on domestic emissions that will incentivize 

the reductions that are cheaper now than the present value of making those reductions later with more advance and cheaper technologies. 

Question 4. Has anyone looked at the cost of inaction—in other words, what the 

impact will be to the economy to not curb emissions? I’m thinking specifically of 

costs related to:

• health care due to dirtier air, 

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• insurance costs due to more intense storms, • government emergency relief services, • the costs of alternative sources of water in the west as the snowpack decreases, • the costs of protecting homes, businesses and highways from rising sea levels, • farm payments due to decreased agriculture output, • and what the potential impact all of those increased costs will have on economic 

growth.

Answer. There is no firm scientific basis currently linking the above consequences 

to increasing atmospheric concentrations of greenhouse gases. There is a general 

consensus among climate modelers that it is currently impossible to calculate the 

effects of atmospheric concentrations at a sufficient level of regional detail to predict 

even the direction of change in these potential consequences. However, various analysts have attempted to make ‘‘what-if’’ calculations of benefits that assume a particular relationship. Even so, their general conclusions have been that very high cost 

near-term emissions reductions (e.g., costs of the level that economists project would 

occur under a hard cap such as McCain-Lieberman’s or the Kyoto Protocol) are not 

justifiable. This is largely because these costly near-term actions will have no meaningful impact to reduce the risks of any of the possible outcomes you have listed 

above. 

Risks to health of air pollutants are already managed under the Clean Air Act, 

and there are far less costly methods for reducing these pollutants than a carbon 

emissions cap. 

Question 5. Your testimony includes a number of comments regarding the allocation of allowances under a greenhouse gas emissions cap-and-trade programs. This 

is a critical issue in putting together such legislation. What is your recommendation 

regarding how the allowances should be allocated? 

Answer. Allocation schemes mainly alter the burden sharing under a cap-andtrade program, and so the decision on allocation of allowances is an inherently political process driven by multiple social objectives. Analysis methods may be useful to 

help politicians and affected parties understand the sharing of the burden associated with different allocation schemes, but they cannot provide enough certainty 

and specificity to positively identify appropriate or ‘‘fair’’ allocations even if the normative goals were to be specified. It is particularly important to recognize that there 

is no allocation scheme under a cap-and-trade program that can make everyone 

whole: even the most cost-effective program will have a net cost, and someone (some 

groups) will ultimately have to bear that cost burden. 

As noted in my testimony, some attributes of an allocation scheme can actually 

exacerbate a cap program’s cost, and politicians should avoid those situations when 

attempting to devise a politically acceptable set of allocations. These include (a) failing to recognize the need to replace government revenues that may decline due to 

the economic impact of the cap, and (b) allocation rules that update what a company 

will receive in future years on the basis of their future business outcomes. 

RESPONSE OF ANNE E. SMITH TO QUESTION FROM SENATOR CORZINE

Question 1. Are you convinced that global climate change is linked to anthropogenic emissions? 

Answer. I think there is enough evidence to warrant climate change risk management. My testimony outlined my thoughts on the key elements of such risk management. 

RESPONSES OF JASON S. GRUMET TO QUESTIONS FROM SENATOR BINGAMAN

Question 1. Emission trading programs have been highly successful in phasing out 

leaded gasoline and CFCs, and most notably in reducing emissions of SO2 and NOX

through the Acid Rain trading program. Is emission trading a good policy instrument for addressing climate change? Why or why not? 

Answer. Emission trading has proved to be a highly effective policy instrument 

for addressing a variety of environmental problems. Moreover, this approach is likely to be especially well-suited to reducing emissions of the chief greenhouse gases 

implicated in human-induced climate change. 

The generic advantage of an emission trading approach is that it can achieve 

maximum environmental benefit at minimum cost by allowing individual sources to 

exploit the lowest cost emission-reduction opportunities available to them. This 

means that sources in a position to cheaply cut emissions can implement more than 

their share of reductions and sell excess permits or allowances to other sources that 

face higher costs. As such, a trading program is far more flexible and cheaper than 

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1 Emissions of other greenhouse gases, notably methane, nitrous oxide, HFCs, PFCs, and SF6, 

can be more difficult to track and document, but these emissions account for a much smaller 

share of the overall inventory. In the case of methane and nitrous oxide, the next most important greenhouse gases in the United States, methodologies for estimating emissions from a variety of sources have been developed and refined over several years and can be used where direct 

measurement of emissions may not be feasible. 

a command-and-control approach, where strict control requirements typically apply 

to each individual source. The proposal put forward by the National Commission on 

Energy Policy goes even further to ensure that costs are known—and ‘‘capped’’—in 

advance by including a safety-valve mechanism that allows sources to buy an unlimited quantity of additional permits from the government at a pre-determined price. 

Emission trading programs work best where the following conditions obtain:

• The underlying environmental problem occurs over a large area, rather than 

being highly localized. 

• A large number of sources are responsible for the problem. 

• The cost of reducing emissions varies from source to source. 

• Emissions can be consistently and accurately measured.

All of these criteria are met in the case of climate change. First, the underlying 

problem occurs over the largest possible area—the entire planet. From the standpoint of warming impacts there is no local component to greenhouse gas emissions—

their effects on the atmosphere are the same wherever they occur. Second, emissions 

of greenhouse gases from different sources vary widely, as do the opportunities and 

costs for reducing those emissions. Finally, it is not difficult to accurately track and 

report the vast majority of emissions of carbon dioxide, the most important anthropogenic pollutant implicated in global warming. Carbon dioxide emissions accounted 

for nearly 85 percent of the overall U.S. greenhouse gas emissions inventory in 

2003; of these emissions, nearly all (98 percent) were energy related—that is, they 

resulted from the combustion of fossil fuels like coal, oil, and natural gas. Unlike 

other energy-related pollutant emissions, which can vary widely depending on combustion conditions, the type of pollution control equipment in place (if any), and a 

host of other parameters, carbon dioxide emissions are a straightforward function 

of the carbon content inherent in the fuel being consumed and can be calculated 

simply and precisely long before combustion actually occurs. This feature means 

that the requirement to hold emissions permits (otherwise known as ‘‘point-of-regulation’’) can occur anywhere along the fuel production, distribution, and consumption 

supply chain. It also means that the great majority of regulated entities do not need 

to install new emissions monitoring equipment, they need simply keep track of the 

type and amount of fuel for which they are responsible within the emission trading 

program.1

Question 2. You seem to agree that the most important long-term feature of any 

climate policy is the impact it will have on investment in R&D and the development 

of new, carbon-free technologies in both the private and public sectors. What do you 

believe are the best policies for pursuing needed R&D? Should these R&D initiatives 

be primarily tax-payer funded, government R&D programs, or should we pursue 

policies to provide incentives for private sector R&D? 

Answer. As I stressed in my testimony, the National Commission on Energy Policy strongly believes that a combination of public and private sector R&D is crucial 

to develop the new technologies that will be needed to effectively reduce not just 

U.S., but global, greenhouse gas emissions over the coming decades. We further believe that the best and most effective means for stimulating technology investment 

is to combine a market signal for reducing emissions with increased public funding 

and performance-oriented government incentives aimed at developing and commercializing low-and non-carbon energy alternatives. In our proposal, a cost-capped 

emission trading program provides the crucial market signal by creating real economic incentives for the private sector to avoid emissions and invest in climatefriendly technologies. This market signal is complemented by increased funding for 

both government and private-sector efforts to develop longer-term technologies, such 

as carbon sequestration, large-scale renewables, or advanced nuclear, that would 

otherwise remain uneconomic in the face of the relatively modest carbon price implicit in our emissions trading proposal. 

As to the question of whether public funding should be primarily directed toward 

government R&D versus private-sector R&D, the Commission believes that both sectors have important assets and expertise and that both must play a significant role 

in advancing new technologies. The final chapter of our report contains a detailed 

discussion of the specific stages of energy-technology innovation and of the different 

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nologies through these stages, which include applied research, development, demonstration, early deployment, and widespread deployment. Typically, government institutions play a larger role in the early stages of that progression (fundamental and 

applied research), while private-sector actors play an increasingly dominant role in 

the latter stages (that is, from development and demonstration through deployment). The following paragraph from our report captures our basic view of how best 

to leverage a combination of private and public sector R&D efforts:

‘‘Complementarity of public-sector investments and incentives with the private sector’s efforts means that the publicly supported efforts should be focused 

precisely on those ingredients of a societally optimal energy research, development, demonstration, and early deployment (ERD3) portfolio that industry 

would not be supporting on its own—avoiding the error of paying industry with 

public funds to do what it would otherwise be doing with its own money. 

Complementarity also means exploiting the complementary technology-innovation capacities of industry and publicly funded national laboratories and academic research centers. In many cases this should entail actual partnerships, 

in which industry’s role will naturally increase as the innovation process in any 

particular case proceeds... specifically, as a technology moves from applied 

research through development, demonstration, and early deployment, the insights about commercial products and the marketplace that are industry’s fort 

become increasingly indispensable to success.’’ (National Commission on Energy 

Policy, Ending the Energy Stalemate: A Bipartisan Strategy to Meet America’s 

Energy Challenges, December 2004, p. 100)

Question 3. Roughly how large an R&D investment do you believe is needed at 

this time, given that radically new technologies will be required in the future to address climate change? Are current energy R&D funding levels adequate, or do you 

think additional resources are required? 

Answer. Among the Commission’s most important findings was the finding that 

current energy-related R&D investment by both the public and private sectors falls 

far short of what is needed to successfully address climate change and meet the 

other critical energy challenges we face in the next century. In fact, energy is by 

far the least R&D intensive high-technology sector in the U.S. economy at present. 

Even as total energy sales in the United States rose from $500 billion per year in 

1990 to about $700 billion per year today, private-sector investment in energy R&D 

investment fell by roughly half, from about $4 billion per year in 1990 to about $2 

billion per year at present. Federal investment in energy R&D, meanwhile, has 

averaged well under $3 billion per year since the late 1980s—it rebounded slightly 

in the early 2000s after reaching a low of less than $2 billion per year in 1998, but 

remains (in constant 2000 dollars) far below the nearly $6.4 billion level of investment reached in the late 1970s. Moreover, the portion of overall federal appropriations devoted to applied energy-technology RD&D in the FY2004 budget came to 

only about $1.8 billion (compared to $6.08 billion in FY1978). Overall, combined private-sector and federal funding for energy R&D amounts to less than 1 percent of 

energy sales, a level of investment that is far below the average for other high-technology industries. 

Deciding how much energy R&D investment is ‘‘enough’’ is, of course, difficult, 

since the answer depends not only on the level of expenditure being considered, but 

on the difficulty of the challenges being addressed and the effectiveness of the R&D 

efforts being mounted to address those challenges. Nevertheless, as we point out in 

our report, every study in recent years that has attempted to look comprehensively 

at this question has concluded that current efforts in both the public and private 

sectors are not commensurate in scope, scale or direction with the challenges, the 

opportunities, and the stakes at hand. To remedy this shortfall, the Commission recommended roughly doubling annual direct federal expenditures on energy research, 

development, and demonstration. Specifically, our recommendations included:

• Revising the energy-relevant provisions of the tax code to substantially increase 

private-sector incentives to invest in energy research, development, demonstration, and early deployment (ERD3). 

• Doubling annual direct federal expenditures on energy research, development, 

and demonstration over the period from 2005-2010 (corrected for inflation)—

with increases emphasizing public-private partnerships, international cooperation, and energy technologies offering high potential leverage against multiple 

challenges. 

• Creating a serious and systematic ‘‘early deployment’’ component to complement 

the increased research, development, and demonstration activity with effective, 

accountable, and performance-oriented approaches to accelerating the attainVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00210 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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2 As noted in my testimony, the LIA analysis specifically found that the cumulative effect of 

the Commission’s recommended greenhouse gas emission trading program would be to reduce 

overall predicted GDP growth between 2005 and 2025 from 80.8 percent to 80.6 percent, or a 

difference of 0.2 percent. 

ment of market competitiveness by the most promising technologies that successfully pass the demonstration phase. • Expanding by at least three-fold, within the above-recommended increases in 

federal ERD3 efforts, the government’s activities promoting and participating in 

international cooperation in this domain. • Strengthening the organization and management of the federal governments 

ERD3 activities through continuation and expansion of the efforts already underway in the Department of Energy (DOE) to improve communication, coordination, portfolio analysis, and peer review in DOE’s ERD3 programs and pursuing increased coherence and self-restraint in the Congressional ‘‘earmarking’’ 

process for ERD3 appropriations.

A further point, which I also stressed in my testimony, is that the Commission 

felt it very important to ensure that additional public spending on energy R&D 

would not add to the current burden on the U.S. Treasury or compound our mounting national debt. Accordingly, we recommend that any new public investments in 

energy R&D be funded through the new revenues raised by auctioning a small portion (maximum of 10 percent) of the emissions permits allocated under our recommended greenhouse gas trading program and through sales of additional permits 

under that program via the safety valve mechanism. Further details and discussion 

concerning the Commission’s energy-technology incentive and R&D recommendations can be found in our full report. 

Question 4. What are the advantages and disadvantages of using intensity-based 

emission targets? 

Answer. The chief advantage of an intensity-based approach is that it creates an 

environmental target that is flexible and responsive to economic conditions. As such, 

the very formulation of the target makes explicit the notion that our goal in the first 

decade of program implementation is only to slow, not stop, current growth in national greenhouse gas emissions and to improve the efficiency of the American economy by reducing its energy intensity: This is a goal that is broadly supported by 

both political parties and by the American public (it is worth noting that the Bush 

Administration’s voluntary greenhouse gas reduction target is also expressed in intensity terms). By contrast, setting a fixed emissions target tends to arouse concerns 

that a policy to limit greenhouse gas emissions will necessarily limit future economic growth. The choice of an intensity-based target, together with a safety-valve 

mechanism to limit the economic cost of implementing overall reductions, results in 

a policy that, according to an independent analysis by the federal Energy Information Administration, would have no material effect on ‘‘the overall growth rate of 

the economy between 2003 and 2025, in terms of both real GDP and potential 

GDP.’’ 2

Another key advantage of an intensity-based approach is that it is more amenable 

to developing country participation. Developing countries are especially sensitive to 

the concern that limiting greenhouse gas emissions will limit growth. By supporting 

the use of intensity metrics in greenhouse gas management regimes that naturally 

accommodate emissions growth, the United States would be designing a framework 

that is more likely to encourage developing country participation. 

Finally, a related advantage of an intensity-based approach is where it sets the 

bar for future policy debate. A fixed target is inflexible by design, politically contentious to iterate, and prone to over-determined conclusions about the success or failure of the policies used to achieve it. In contrast, negotiations based on intensity 

goals are about the rate of decline and offer greater opportunities for fine-tuning 

and adjustment. As such, this approach may prove more robust and resilient than 

the alternative approach of setting absolute goals based on historic emissions levels. 

However, it should be noted that, the very attributes that make an intensity approach well suited for the initial decades a carbon management program may eventually need to be reconsidered if a global scientific and political consensus forms 

around a desired absolute emissions target. As the global effort to address climate 

change matures, it may eventually become reasonable to place less emphasis on providing economic certainty (through mechanisms such as the safety valve and the intensity target) while placing more emphasis on achieving and maintaining a fixed 

environmental outcome. For just this reason and because it is inherently impossible 

to prejudge developments that might affect policy deliberations decades into the future, the Commission has not attempted to articulate detailed recommendations for 

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time, however, we believe that our proposed approach achieves an appropriate balancing of the need for economic versus environmental certainty and that the advantages of setting emissions targets on an intensity basis outweigh the disadvantages 

of using this approach. 

Question 5. What are your views on setting up a trust fund with the proceeds 

from a cap and trade program and using the revenue to fund investment in low 

emission energy technologies? 

Answer. As noted above and in my earlier testimony, the Commission strongly 

recommends that additional public investment in low-and non-carbon energy technologies should be funded by the auction of a portion of permits or allowances under 

its proposed emission trading program, together with revenues generated by the 

sale of additional permits or allowances through the safety valve mechanism. Because significant global reductions in greenhouse gases will eventually require the 

development and large-scale deployment of new technologies, these investments are 

absolutely critical if we are to achieve long-term success in dealing with climate 

change while simultaneously ensuring continued access to reliable and affordable 

energy supplies. The Commission considered the relative merits of ‘‘on-budget’’ and 

‘‘off-budget’’ funding strategies. In light of Congress’ historic reluctance to support 

‘‘off-budget’’ funding mechanisms and the challenges inherent in creating a new institution, the Commission focused its recommendations on opportunities to build 

upon recent successful efforts to improve the effectiveness of existing government 

technology programs. While recognizing that Congress alone is responsible for appropriations, the Commission believes that the practice of non-competitive earmarks 

has in some cases undermined the effectiveness of public funds spent on energy 

technology innovation and believes that greater efforts are needed to ensure that 

earmarks are consistent with the strategic objectives of the programs affected. 

RESPONSES OF JASON S. GRUMET TO QUESTIONS FROM SENATOR AKAKA

Question 1. My question has to do with sequestration of carbon. Did your Commission look at various ways to enhance sequestration of carbon—that is, taking carbon 

out of the earth’s biosphere by a number of means including storing it in oceans 

and increasing plant biomass? Did the Commission see this as a viable means to 

reduce carbon? How did the Commission see it as participating in the overall market? 

Answer. The Commission believes that geologic sequestration is a promising strategy for reducing the climate impacts associated with future use of traditional energy 

resources, most notably coal. In particular, we looked at geologic carbon sequestration in combination with the development and deployment of advanced integrated 

gasification and combined cycle (IGCC) coal-fired electricity production. Potential repositories for geologic carbon sequestration include depleted oil and gas fields, 

unmineable deep coal seams, or deep saline formations. In general, we are optimistic about the potential role for geologic carbon sequestration as part of an array 

of strategies for mitigating climate change risks in the future. This optimism is 

based on the size of potential geologic repositories in the United States, which, according to current estimates, could theoretically hold hundreds of years worth of 

current U.S. emissions and on the fact that all aspects of the technology required 

for carbon capture and sequestration are developed and in use today, primarily to 

support the use of carbon dioxide injection for oil recovery. Further investment is 

required, however, to reduce costs and to demonstrate and deploy these technologies 

on the scale needed for meaningful capture and sequestration in the context of a 

larger greenhouse gas management strategy. The Commission’s recommendations 

therefore include $3 billion in public support over ten years for the commercial-scale 

demonstration of geologic carbon storage at a variety of sites around the country, 

both in conjunction with coal IGCC plants and as stand-alone sites. 

While our analysis focuses primarily upon geologic sequestration, the Commission 

recognizes the important role that biological sequestration must also play in longterm carbon management strategies and believes that there are a variety of opportunities for agriculture and forestry industries to profit as the sellers of reduction 

credits under a market-based emissions trading program. One biological sequestration strategy that the Commission devoted considerable attention to is the opportunity to accelerate commercial scale production of ethanol from cellulosic biomass. 

We believe that this technology is particularly attractive due to the combined benefits cellulosic ethanol offers for climate change mitigation and improved oil security. 

The Commission did not look closely at deep-ocean sequestration strategies. 

Question 2. Clearly the participation of developing countries in a global carbon reduction effort is necessary to make a difference on global greenhouse gases. How 

does the Commission see that link or challenge working—between developed nations 

209

that have adopted carbon controls, and either leading or pushing countries such as 

China and India to adopt similar emissions controls? What does the Commission see 

as the best way to ensure those changes? 

Answer. The Commission wholeheartedly agrees that the problem of climate 

change requires a global response and cannot be meaningfully addressed on a longterm basis without full participation by all major emitting nations, including developing nations such as China, India, and Brazil. We believe the best way to elicit 

an equitable and effective global response is for the United States to return to a 

position of international leadership on this issue by taking an initial step domestically, while designing that initial step so that it explicitly links future U.S. action 

to limit greenhouse gas emissions to comparable efforts by other developed and developing nations to achieve their own emissions reductions. Thus, our proposal for 

a mandatory, economy-wide U.S. greenhouse gas emissions trading program is intentionally phased and carefully designed to protect our economy from competitive 

disadvantage if other nations fail to limit their emissions. It also contains an important provision for periodic five-year reviews of the U.S. program which would enable 

Congress to assess progress by other countries as part of a determination of how 

domestic efforts should evolve. Specifically, the Commission recommends that if:

‘‘other countries with significant emissions and/or trade with the United 

States do not take comparable action to limit emissions by 2015, five years from 

the commencement of the U.S. program, further increases in the safety valve 

price should be immediately suspended. Depending on international progress, 

the United States could also opt not to introduce a more ambitious target rate 

of emissions intensity improvement in 2020 and make other adjustments to its 

domestic program; conversely it could decide to move forward more aggressively 

in the second decade of program implementation than the Commission is proposing.’’ (National Commission on Energy Policy, Ending the Energy Stalemate: 

A Bipartisan Strategy to Meet America’s Energy Challenges, December 2004, p. 

25)

By explicitly linking future U.S. actions to international progress, the Commission 

hopes to create a ‘‘push’’ for developing country involvement in climate mitigation 

efforts. That push should be combined with positive incentives aimed at ‘‘leading’’ 

other countries toward participation. Accordingly, we recommend that the United 

States continue and expand its current bilateral negotiations with nations such as 

China, India, and Brazil while also providing incentives to promote technology 

transfer and to encourage U.S. companies and organizations to form international 

partnerships for implementing clean energy projects in developing nations. 

Finally, it is important to recognize that a number of countries are already taking 

steps to limit greenhouse gas emissions. This includes not only our major trading 

partners in the developed world, many of whom (including the European Union, 

Japan, and Canada) have adopted the Kyoto Protocol and begun efforts to implement their obligations under Kyoto, but also several key developing nations that 

have begun reducing their emissions below forecast levels as they pursue enhanced 

energy security, energy efficiency, conventional pollution control, and market reform. These developments are encouraging and provide grounds for optimism U.S. 

efforts to address our own contribution to the climate problem would prompt an 

international response more likely to exceed our expectations than to disappoint 

them. 

RESPONSES OF JASON S. GRUMET TO QUESTIONS FROM SENATOR FEINSTEIN

Question 1. Under the National Commission on Energy Policy’s proposal, what 

happens when a covered entity uses the safety valve rather than lowering emissions? What is done to ensure that emissions are actually reduced? 

Answer. Differing opinions about the pace of technological progress make it impossible to confidently predict both the costs and benefits of mandatory greenhouse 

gas reduction efforts. Through inclusion of a ‘‘safety-valve’’ mechanism to cap program costs, the Commission is expressing a preference for cost-certainty over emissions certainty in the initial stages of a carbon management regime. Ultimately, addressing the threat of climate change will require global agreement about an ecologically sustainable emission limit and an equitable sharing of reduction burdens. 

Achieving the long-term environmental objective will likely require that fixed emission limits eventually replace cost-based policies. However, the Commission strongly 

believes that reducing uncertainty about near-term economic impacts is crucial to 

creating a consensus for timely action. 

A cap and trade program with a safety valve will function exactly like a traditional cap and trade regime until and unless technology fails to progress as desired. 

210

Under a traditional cap approach, slower than desired technological progress results 

in higher than anticipated program costs. Through inclusion of the safety-valve compliance mechanism, a failure of technology to progress as the desired rate will cause 

firms to purchase additional emission permits from the government at a set price 

leading to lower than anticipated emission benefits. The Commission and the Energy Information Administration have each analyzed the projected impacts of the 

Commission’s climate program under a range of technology assumptions. Both conclude that under relatively optimistic technology assumptions, the safety-valve will 

not be triggered and full program benefits will be achieved. Conversely, under more 

pessimistic technology assumptions, firms will take advantage of the safety valve 

compliance option resulting in roughly half of the emission benefits. Advocates for 

mandatory climate action generally tend toward technology optimism arguing that 

main economic models fail to capture a range of cost-effective compliance options. 

If correct, the safety-valve will simply have served to allay the anxieties and speeded adoption of a meaningful reduction program. If incorrect, the safety-valve will 

serve its intended purpose of achieving all available emissions reductions up to, but 

not beyond, the point where overall costs to the economy are deemed acceptable by 

policymakers. The Commission has proposed a price—starting at $7 per metric ton of carbondioxide-equivalent in 2010 and escalating in nominal terms by 5 percent per year 

thereafter—that is high enough, in our judgment, to achieve substantial emissions 

reductions and generate a meaningful market signal for encouraging investment in 

low-and non-carbon alternatives, but not so high as to materially impact the U.S. 

economy or undermine the competitiveness of U.S. firms in international markets. 

Question 2. Under the Commission’s proposal, a company could pay the $7/ton fee 

instead of reducing the greenhouse gases. So, in the end, is there really a firm cap 

on emissions? 

Answer. There is no firm cap on emissions in the Commission proposal. 

There is no debate over the fact that a carbon program with a $7 per ton CO2

cost cap sends a weaker market signal than a program in which limits must be 

achieved regardless of economic impact. However, it is worth noting that most 

greenhouse gas cap-and-trade proposals to date have included a variety of so-called 

‘‘flexibility mechanisms’’ that would, in practice, also allow domestic emissions to 

rise above the stated cap. Since the costs associated with achieving a fixed level of 

emissions reduction cannot be known in advance, cost arguments are impossible to 

adjudicate to the satisfaction of all stakeholders and will likely continue to stymie 

efforts to reach political consensus. Hence our Commission believes that the more 

meaningful comparison may be between the timely adoption of a cost-capped mandatory program and the continuation of business as usual in which domestic carbon 

emissions can be vented into the atmosphere at no cost. From ecological, economic 

and political perspectives the Commission believes that speeding the adoption of a 

robust policy architecture to address the long-term challenge of climate change is 

more important than achieving a precise level of near-term emission reductions. 

Question 3. What policy solutions do you recommend to correct for this so we can 

still make environmental progress? 

Answer. We regard the safety valve feature as a key virtue of our proposal and 

do not believe it requires ‘‘correction.’’ Proposals, which may set strict caps and look 

more aggressive on paper, won’t result in progress if they never succeed in garnering the political support needed to implement them. Congress has repeatedly 

gone on record in support of action on climate only if such action does not damage 

the U.S. economy or undermine U.S. competitiveness. We believe our proposal meets 

that test, while still achieving substantial reductions below the emissions trajectory 

projected absent policy intervention. Specifically, modeling analyses conducted using 

conservative assumptions about technology innovation indicate that our proposal 

will produce 540 million metric tons of carbon-dioxide-equivalent greenhouse gas reductions in 2020, a 6 percent reduction below business-as-usual projections. Under 

more optimistic technology assumptions, estimated reductions in 2020 could roughly 

double to approximately 1 billion metric tons. 

While our proposal certainly achieves progress in slowing emissions growth over 

the first decade of program implementation, its more important contribution over 

the long run is likely to reside in the market signal it creates for avoiding future 

emissions. Only when greenhouse gas reductions have a concrete value will the tremendous ingenuity and investment potential of the American economy be brought 

to bear in developing and deploying the new technologies needed to achieve more 

substantial emissions reductions in the future—not only in the United States, but 

worldwide. 

The initial market signal created by the Commission’s proposal—at $7 per metric 

ton of carbon dioxide—is admittedly modest. As I noted in my testimony, we seVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00214 Fmt 6601 Sfmt 6621 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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lected this figure because our analysis of the available literature suggested it roughly corresponds to the mid-point of current estimates of the expected harm that can 

be attributed, based on present scientific understanding, to a ton of greenhouse gas 

emissions. Perhaps more importantly, at $7 per ton the safety valve price was sufficiently low as to minimize the immediate burden on consumers and business and 

avoid forcing the premature retirement of long-lived capital assets (such as power 

plants) that were constructed before climate concerns figured in the investment decisions of most energy companies, while still creating a meaningful market signal 

for avoiding future emissions. Certainly a stronger initial signal would produce a 

stronger initial response, but it would also be more costly to the economy. Finally, 

it is important to emphasize that the market signal under the Commission’s proposal grows steadily stronger over time as the nominal safety valve price increases 

by 5 percent per year. This gradual but measurable progression in the stringency 

of the program gives businesses the planning certainty they need to make wise longrun investments that will minimize the costs of achieving greenhouse gas emissions 

reductions over time. 

In sum, as I noted in the previous response, the decision about where to set the 

safety valve price is ultimately a political one. Ultimately it is probably less important what specific price is chosen than that we get started. The Commission believes 

its proposal—by removing cost uncertainty as a basis for inaction—offers the best 

chance we have right now to do just that. 

Question 4. Has anyone looked at the cost of inaction—in other words, what the 

impact will be to the economy to not curb emissions? I’m thinking specifically of 

costs related to:

• health care due to dirtier air, 

• insurance costs due to more intense storms, 

• government emergency relief services, 

• the costs of alternative sources of water in the west as the snowpack decreases, 

• the costs of protecting homes, businesses and highways from rising sea levels, 

• farm payments due to decreased agriculture output, 

• and what the potential impact all of those increased costs will have on economic 

growth.

Answer. In the early stages of its deliberations, the Commission reviewed the 

available literature on potential costs associated with future climate change, including costs associated with many of the categories of possible impact listed in the 

question. Some of this material is available in a separate compendium of research 

that the Commission compiled as part of its final report and that we would be 

happy to make available to the Committee. The short answer to the question is that 

inaction will almost certainly impose costs on our economy and there is good reason 

to believe that these costs could be quite large. The difficulty, of course, is in quantifying these costs given the numerous uncertainties that are involved; the complexity 

of various feedback mechanisms, not only within the climate system but in the natural and human systems that are intimately affected by climate; and the inherent 

difficulty of assigning a specific value to things like species diversity and ecosystem 

preservation. Not surprisingly, analyses that have attempted to derive cost estimates for the likely impacts of climate change have therefore produced a wide range 

of results. 

In fact, as is often the case with important environmental issues, it is even harder 

to agree on the cost of inaction than it is to agree on the cost of taking steps to 

mitigate the problem. For this reason, Commission members agreed that it would 

be unproductive to become bogged down in either side of the cost debate. A much 

simpler conclusion: that the overwhelming weight of scientific evidence points to the 

risk, if not the certainty, of potentially significant adverse harms and that cautious 

steps are warranted at this time to begin reducing that risk, provided an adequate 

basis for consensus within our own very diverse group and should, in our view, provide an adequate basis for action by Congress. In fact, we believe a modest and 

gradual approach such as we have proposed, because it is inherently flexible and 

can be fine-tuned as better information becomes available, is precisely the best response in a situation where uncertainties abound on both sides of the impact versus 

mitigation cost-debate. The key is to start now, because by doing so we effectively 

buy time to make adjustments if climate change and the consequences it unleashes 

turn out to be worse than expected. By contrast, each additional year of political 

stalemate and inaction simply limits our options and increases the risk that we’ll 

eventually realize we should have done more, but realize it only when it is already 

too late. 

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RESPONSES OF JASON S. GRUMET TO QUESTIONS FROM SENATOR SALAZAR

Question 1. Mr. Grumet, thank you for your participation today and for your work 

on the National Commission on Energy Policy. The NCEP proposal would have a 

very modest effect on the economy. Furthermore, your climate change proposal 

takes great pains to ensure no one source of energy is put in an unfavorable position 

compared to others. 

Now, this is very important to me, because as you know coal is a large part of 

the Colorado economy, and in fact it is a large part of America’s energy future. 

Can you explain how the NCEP climate change proposal will prevent coal from 

being adversely affected? 

Answer. Commission members recognize the extremely important role that coal 

plays in the nation’s and the world’s energy mix and took care to develop policy recommendations that offer, in our view, the best odds of ensuring a continued and significant role for coal in the future. Our approach is two-fold. On the one hand, the 

near-term policy we have proposed for slowing growth in U.S. greenhouse emissions 

is designed—both in terms of the target it sets, the cost certainty it provides, and 

the very gradual way in which it progresses—to minimize adverse impacts on coal 

and give the industry an opportunity to adjust successfully to emerging climate constraints. As a second, critical policy complement to this program, our recommendations provide for substantial public investment in helping the coal industry to develop and deploy a next generation of technologies that are compatible with the 

need to limit greenhouse gas emissions and address a number of other coal-related 

environmental concerns. 

With respect to the Commission’s climate change proposal, we looked specifically 

at the impacts of our greenhouse gas trading program on the coal industry. As one 

would expect, the effects of the proposal on coal use and coal prices would be somewhat more significant than the effects on other, less carbon-intensive fossil fuels like 

natural gas and oil. Nevertheless, under our proposal projected coal consumption in 

2020 is reduced by only 9 percent relative to the business-as-usual forecast and 

overall coal use still rises by 16 percent compared to current (2004) consumption. 

In fact, modeling indicates that our proposal will cause the additional retirement 

of just 700 megawatts of existing coal-fired generating capacity (approximately 

equivalent to one medium-large power plant)—again relative to base-case projections—between now and 2020. 

While early efforts to limit greenhouse gas emissions need not and, in the Commission’s view, should not create undue hardship for the coal industry, it is clear 

that the industry will need to evolve to improve its competitiveness in an increasingly carbon-constrained world. The key is to develop coal technologies that are compatible with the need to reduce greenhouse gas emissions and that also address 

other public health and environmental concerns currently associated with conventional pulverized coal plants. The Commission sees great promise for achieving 

these objectives through integrated gasification and combined cycle (IGCC) coal 

technology, which—besides having lower pollutant emissions of all kinds—can open 

the door to economic carbon capture and storage. In fact, we believe the future of 

coal and the long-term success of future greenhouse gas mitigation efforts may 

hinge to a large extent on whether IGCC technology can be successfully commercialized and deployed over the next twenty years. Our complete report includes a 

detailed description of the potential of this technology, including its potential as a 

means for someday producing clean low-carbon liquid fuels suitable for use in the 

transportation sector, as well as a discussion of the financial and technological challenges that must be overcome to give coal IGCC a chance to prove itself in the marketplace. To help overcome these obstacles we propose a substantial increase in federal support for IGCC and other promising advanced coal technologies. Specifically, 

the Commission recommends that the federal government:

• Provide up to $4 billion over ten years to support the early deployment of 

roughly 10 gigawatts of sequestration-ready IGCC plants. 

• Provide support for the commercial-scale demonstration of geologic carbon storage at a variety of sites with an investment of $3 billion over ten years.

In sum, the Commission firmly believes that the best future for coal lies not in 

continued paralysis on the issue of climate change, but in carefully designed policies 

that both effectively reduce climate risks and do so in a manner that helps the industry adapt and even thrive. That the United Mine Workers of America, an organization which we consulted frequently and extensively throughout our deliberations, 

has expressed support for the Commission’s report and recommendations provides 

considerable grounds for optimism that it is possible to do both. 

Question 2. Why is the NCEP proposal so modest? 

213

Answer. As I noted in my testimony and in several of the foregoing responses, the 

Commission recognized from the outset that progress on climate change was not 

going to be possible in this country unless Congress and the public could be convinced of two things: first, that reducing greenhouse gas emissions could be achieved 

without harming the U.S. economy or putting U.S. businesses at a competitive disadvantage and second, that all countries with major emissions would soon join the 

United States in doing their fair share to implement reductions. The modesty of our 

proposal reflects an appreciation for the importance of these constraints. It also reflects an appreciation of the extent to which significant uncertainty on all sides of 

the climate debate, but most notably with respect to the consequences of current 

emissions trends and the costs and benefits of mitigation, argues for a gradual and 

flexible approach. Commission members are well aware that the emissions reductions required on a worldwide basis to stabilize atmospheric concentrations of greenhouse gases far exceed the level of reduction that would be achieved by the policies 

we have proposed for implementation over the next 10 to 20 years. As such we have 

never advertised our recommendations as a ‘‘solution’’ for climate change. Our goal, 

rather, was to design an approach that would allow the United States to take an 

initial step domestically while simultaneously establishing a robust policy architecture that could evolve over time to reflect changes in scientific understanding, technology development, and prospects for collaboration with other nations. Or as we 

put it in our report:

‘‘[T]his proposal should be understood as an initial domestic step in the longterm effort to first slow, then stop, and ultimately reverse current emission 

trends. In its structure and stringency, the Commission’s proposal is designed 

to encourage the timely initiation of what will necessarily be a phased process. 

The Commission believes that this approach is more pragmatic and ultimately 

more effective than years of further legislative stalemate in pursuit of a more 

aggressive initial goal.’’ (National Commission on Energy Policy, Ending the Energy Stalemate: A Bipartisan Strategy to Meet America’s Energy Challenges, 

December 2004, p. 19)

RESPONSES OF HOWARD GRUENSPECHT TO QUESTIONS FROM SENATOR BINGAMAN

Question 1. The U.S. spends a significant amount of money on R&D into non-carbon and low-carbon technologies. How does this amount compare to our overall economy, our total spending on energy, and our total greenhouse gas emissions? Are 

other countries spending comparable amounts based on their size and emission levels? 

Answer. The most recent year for which data are available for all of the domestic 

parameters requested above is 2003. For fiscal year 2003, Federal spending for programs in the Climate Change Technology Program was $2,555 million. For calendar 

year 2003, U.S. gross domestic product was $11,004 billion, energy expenditures 

were $751.7 billion, and total net greenhouse gas emissions were 6,072.2 million 

metric tons CO2 equivalent. Therefore, Federal spending on climate-change technologies was 0.023¢ per dollar of GDP, 0.34¢ per dollar of energy expenditure, and 

42.1¢ per ton of CO2 Eq. Reliable data on government expenditures for climate 

change-related technologies are not readily available for other countries. 

Question 2. Roughly how large an R&D investment do you believe is needed at 

this time, given that radically new technologies will be required in the future to address climate change? Are current energy R&D funding levels adequate, or do you 

think additional resources are required? 

Answer. In 2005, the Federal Government plans to invest nearly $2 billion in climate change science and nearly $3 billion in climate change technology research, 

development, and deployment, including voluntary partnerships. Funding for these 

activities is adequate. 

Question 3. In the EIA’s analysis of the NCEP climate change proposal, was it 

important to know where in the energy system the point of regulation would be located? How was the point of regulation handled for the purposes of your analysis? 

Please describe what impact the point of regulation has on overall program effectiveness and discuss what bearing it has on your analysis. 

Answer. The cost and effectiveness of any regulations depend partially on how 

they are implemented. ETA’s analysis does not include the implementation costs 

(i.e., monitoring, verification, and management costs) of the NCEP cap-and-trade 

proposal for either the public or private sector, primarily because the implementation processes to be used are generally unspecified in the NCEP report. The actual 

214

costs of the NCEP proposal could be higher if the implementation process hinders 

the development of a fully functioning and efficient market for permits. 

The NCEP climate proposal, a cap-and-trade system with a safety-valve price on 

GHG permits, is loosely modeled after the power plant SO2 cap-and-trade program 

created in the Clean Air Act Amendments of 1990. This program generally has very 

low transactions costs. However, the NCEP proposal is more complex and difficult 

to manage because of the larger number of entities potentially affected. In EIA’s 

analysis, a permit fee, based on the carbon content of the fuel, is reflected in the 

fuel cost at the point of consumption and all affected consumers are assumed to directly participate in the permit transactions. From an implementation perspective, 

however, it is impractical to expect many of the residential, commercial, and small 

industrial end-users to actually trade in permits. It is far more likely that the permit purchases and transactions would be regulated, managed and monitored at 

major emitters and major distribution points (marketers and distributors) in the energy market. 

Question 4. In the ETA’s analysis of the NCEP climate change proposal, was it 

important to know whether, how, and to what extent emission allowances would be 

allocated? How was allowance allocation handled for the purposes of your analysis? 

Please describe what impact the allowance allocation scheme has on overall program 

effectiveness and discuss what bearing it has on your analysis. 

Answer. EIA’s analysis assumed that the tradable permits allocated to the Federal Government (5 percent of the total between 2010 and 2012, then rising to 10 

percent in 2022 and thereafter as specified in the NCEP recommendations) were 

publicly auctioned. The government also receives the safety value price for all permits that are purchased in excess of the emissions target for the cap-and-trade program. All other permits are allocated to emitters in proportion to their historical 

emissions. 

EIA calculates that the projected cumulative discounted Federal revenue equals 

the cumulative discounted expenditures in 2022. Beyond 2022 any excess revenues 

collected are assumed to flow to the U.S. Treasury. Although EIA did not consider 

alternative allocation schemes, if the percent of tradable permits allocated to the 

Federal Government were higher, more revenues would flow to the U.S. Treasury 

and the point of ‘‘fiscal neutrality’’ would occur sooner. 

ETA’s analysis assumes that emission permits that are allocated to emitters are 

‘‘grandfathered’’ based on historical utilization. A different allocation of permits 

would generally not affect the efficiency of the program, but it would change it’s distributional impacts. 

Question 5. Please reflect on the recent analysis you conducted for Senator Inhofe 

on the impacts of higher natural gas prices—among other things—on the NCEP’s 

climate change proposal. Was the safety valve effective in keeping overall program 

costs down when confronted with the higher costs in this sensitivity case? 

Answer. Senator Inhofe requested that EIA prepare sensitivity runs based on the 

full National Commission on Energy Policy (NCEP), Cap-Trade (with safety valve), 

and No-Safety (greenhouse gas cap and trade policy without safety valve) cases from 

our report using the natural gas price and availability assumptions in the Annual 

Energy Outlook 2005 (AEO2005) ‘‘restricted natural gas supply’’ case, and assuming 

25 and 50 percent fewer non-carbon dioxide emission reductions were available for 

purchase at a given greenhouse gas permit price. 

We prepared three groups of four model simulations. Each group includes the 

comparable case from the earlier analysis of the NCEP proposals done at the request of Senator Bingaman, along with three sensitivity cases as stipulated by Senator Inhofe above. 

We found that the alternative assumptions about natural gas supplies and the 

availability of non-CO2 greenhouse gas emissions reductions have fairly small effects 

on the estimated incremental impacts of the NCEP’s recommendations. The higher 

natural gas prices that result from the AEO2005 restricted natural gas supply assumptions tend to lower overall energy demand and make non-fossil fuels like renewables and nuclear more attractive, even without the NCEP’s recommended appliance and building efficiency standards, technology incentives, and greenhouse gas 

cap and trade programs. As a result, the incremental costs of complying with the 

NCEP recommendations are generally lower with these alternative assumptions 

even though the absolute level of economic performance, both with and without the 

cap-and-trade program, is adversely impacted by the reduced availability of natural 

gas in the restricted supply scenarios. 

The assumptions about the availability of reductions in the emissions of non-CO2

greenhouse gases are only important when the NCEP’s recommended greenhouse allowance price safety valve is not in effect. When the safety valve is in effect, the 

emissions reductions coming from non-CO2 gases are lower with the alternative 

215

availability assumptions, but there is little impact on energy markets because the 

greenhouse gas allowance price is capped, limiting the impact of the NCEP’s capandtrade proposal. 

RESPONSES OF HOWARD GRUENSPECHT TO QUESTIONS FROM SENATOR CORZINE

Question 1. I understand that your estimate of the economic impact of the NCEP 

proposal is that it would change our GDP in 2020 by a very minimal amount. Answer. In 2000 dollars, real GDP in the NCEP case is expected to be $10 billion lower (0.1 percent) in 2010 and $35 billion lower (0.2 percent) in 2020 relative to 

the reference case. Consumption of goods and services per household falls by approximately $66 (0.1 percent) in 2010 and $273 (0.3 percent) in 2020. The consumer 

price index (CPI) rises by 0.2 percent in 2010 and by 0.4 percent in 2020. The inflation rate, as measured by the growth rate of CPI, increases by about 0.2 percent 

point in 2010 and by less than 0.1 percent point in 2020. The implementation of 

higher CAFE standards raises the average price of new light-duty vehicles by approximately four percent, with a decrease in sales of approximately four percent. 

If only the cap-and-trade system is put in place (the Cap-Trade case), real GDP is expected to be $9 billion lower (0.1 percent) in 2010 and $17 billion lower (0.1 

percent) in 2020 relative to the reference case. Consumption of goods and services 

per household falls by approximately $45 (0.1 percent) in 2010 and $78 (0.1 percent) 

in 2020. The consumer price index (CPI) rises by 0.2 percent in 2010 and by 0.5 

percent in 2020. The inflation rate, as measured by the growth rate of CPI, increases by about 0.2 percent point in 2010 and by less than 0.1 percent point in 

2020. 

The relative size of these estimated impacts is, of course, in the eye of the beholder. 

Question 2. Given the urgency of the global warming problem, what more can we 

do, beyond the NCEP proposal without, in the words of the Sense of the Senate resolution that we adopted last month, ‘‘significantly harming’’ the U.S. economy? 

Answer. The Energy Information Administration (EIA), consistent with its statutory mission, does not develop or advocate any particular energy policy or environmental policies. One key way to minimize the impact on the economy of policies 

Congress or the Administration might wish to implement is to provide sufficient 

lead time to allow the various parts of the economy—consumers, business, and government—to change practices on a gradual steady basis rather than abruptly. Prospects for a smooth adjustment to policy changes are also enhanced when affected 

parties have the expectation that the newly implemented policies will be long-lived 

in order to have a lasting effect on behavior. 

RESPONSE OF HOWARD GRUENSPECHT TO QUESTION FROM SENATOR SALAZAR

Question 1. Dr. Gruenspecht, in April 2005, the Energy Information Administration (ETA) released a report analyzing the policy recommendations contained within 

the 2004 National Commission on Energy Policy (NCEP) report entitled, ‘‘Ending 

the Energy Stalemate: A Bipartisan Strategy to Meet America’s Energy Challenges.’’ 

Since this analysis was published, the U.S. Senate passed a ‘‘Sense of the Senate’’ 

resolution calling for mandatory limits and incentives to slow, stop, and reverse the 

growth of greenhouse gas emissions in a manner and at a pace that will not significantly harm the economy and will encourage comparable actions by other countries. 

In order to evaluate the full range of potential policies that would be compatible 

with the resolution, I request that the EIA build on its analysis to date by running 

a number of additional intensity target and safety valve scenarios. I note that EIA 

has been able to respond quickly to other Senators’ analytical requests following the 

April report, and I request a similarly prompt response to this letter. 

The analysis in the April 2005 report included a greenhouse gas (GHG) emissions 

intensity reduction program with a GHG intensity improvement of 2.4 percent per 

year between 2010 and 2019 and 2.8 percent per year between 2020 and 2025, and 

with a safety-valve permit price starting at $7 per metric ton CO2 equivalent in 2010 nominal dollars and increasing by 5 percent annually up to $14.55 in 2025. 

I request an additional analysis that evaluates a range of intensity improvements 

and safety-valve combinations. This analysis should include additional 

intensityimprovement/safety-valve combinations with intensity improvements ranging from 2.6 to 4.0 percent per year and safety valve values ranging from $10 to 

$35 (in 2010 nominal dollars, rising five percent per year). The purpose of this analysis would be to draw out the impacts of alternative policies. The different combinations run should allow policy makers to evaluate the impact of changing the safety 

valve price through this range given the base case intensity improvement (2.4 percent through 2020 and 2.8 percent thereafter), and to evaluate the impact of inVerDate 0ct 09 2002 10:10 Dec 08, 2005 Jkt 109188 PO 24631 Frm 00219 Fmt 6601 Sfmt 6602 P:\DOCS\24631.TXT SENERGY2 PsN: PAULM
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creasing the intensity improvement through this range in combination with various 

safety valve prices. Each of these combinations should be analyzed under both the 

base case and high technology assumptions. 

This report should include estimates of the same environmental and economic indicators from the previous report, including but not limited to supply estimates (by 

fuel), GHG emissions, GDP and employment. 

I request that you complete these analyses and report them to me and other members of this Committee by December 1, 2005. 

Answer. EIA has met with Dr. John Plumb of your staff to discuss an approach 

to addressing this request. 

RESPONSE OF HOWARD GRUENSPECHT TO QUESTION FROM SENATOR AKAKA

Question 1. The EIA analysis shows that three of the National Commission on Energy Policy’s proposals will have the greatest effect on energy demand, use, and consumption in the U.S.—the cap and trade program, the increase in automobile fuel 

efficiency standards, and the new building and appliance efficiency standards. As 

far as economic impacts go, your testimony indicates that although costly, the 

changes will not affect average economic growth rates for the 2003 to 2025 time 

frame. 

It appears from your analysis that fuel economy standards for transportation are 

essential for the rest of the cap-and-trade policy. They drive down demand and offset the cost of permits for the cap-and-trade system. Would you agree that to be 

successful, the carbon emissions from the transportation sector must be included in 

any cap-and-trade control policy? 

Answer. It is generally true that the least costly approach to meeting any national 

greenhouse gas emissions intensity target is to include as many of the energy consuming sectors as possible in the cap-and-trade system, including the transportation 

sector. For any specific emissions target, the more expansive the market to which 

a GHG cap-and-trade policy applies, the less costly such a policy is to implement. 

Transportation fuel consumption produces approximately one third of all combustion-related carbon dioxide emissions. In that sense, the transportation market is 

an important sector to incorporate in any carbon dioxide emission control strategy. 

There are three ways to reduce carbon dioxide emissions in the transportation sector: (a) through a capand-trade system which adds to the cost of using fossil fuels 

based on the carbon dioxide emitted, (b) through the use of standards (i.e., Corporate Average Fuel Economy (CAFE)), or (c) a combination of standards and a capand-trade system. 

EIA studies have shown that carbon dioxide permit prices that are comparable 

to those under the NCEP cap-and-trade program would have negligible impacts on 

transportation fuel consumption. The result suggests that the transportation sector 

is not expected to be a major source of low cost GHG reductions. The NCEP permit 

price cap of $8.50 per ton carbon dioxide translates into an increase of about $0.08 

per gallon in the delivered gasoline price. Carbon dioxide permit prices would need 

to rise to much higher levels to significantly affect consumer choices for light duty 

vehicles and fuel consumption. Light duty vehicle purchase patterns have only recently begun to shift in response to the increase in fuel prices. It is useful to note 

that an increase of 1 dollar per gallon of gasoline corresponds to a carbon dioxide 

permit fee of over $110 per ton carbon dioxide or $400 per ton carbon. 

Fuel economy standards are a more direct way to limit petroleum fuel use, a goal 

that is related to, but distinct from, the goal of GHG reduction. However, consumer 

purchase patterns have shown that at prices under $2 per gallon, consumers value 

horsepower, safety and size more than efficiency. Fuel economy standards that override consumer preferences could engender a significant welfare cost. 

RESPONSES OF HOWARD GRUENSPECHT TO QUESTIONS FROM SENATOR FEINSTEIN

Question 1. Could you explain the correlation between the level of emissions and 

the ‘‘safety valve’’ in the National Commission on Energy Policy’s proposal? Specifically, how would the emissions level change over time at various levels of the price 

cap? Does the price cap of $7 per ton lead to a stopping and reversal of emissions 

growth? Did you analyze alternative safety valve prices? For example, what happens if we increase the price to $15, which is the level of 

the Canadian price cap? 

What happens if we increase it to $30, roughly the level that emissions allowances 

are trading for in the European Union this week? 

Answer. The greenhouse gas intensity target proposed by the NCEP implies an 

annual greenhouse gas (GHG) emissions target into the future. All energy users 

217

bear the cost of holding emissions permits equal to their greenhouse gas emissions 

in each year. Using a cap-andtrade system, a market-clearing emissions permit 

price is developed at which the energy market would take sufficient action to limit 

emissions to meet the desired GHG target. Since banking of permits is permitted 

in the NCEP proposal, some energy consumers may ‘‘over-comply’’ in earlier periods 

when cost is relatively low so that they can use the allowances later or sell them 

to others with a higher implicit compliance cost. As it does, the permit price rises 

until it reaches the safety valve price. When the permit price exceeds the safety 

valve price, some buyers will purchase permits from the Government at the safetyvalve price rather than undertake costlier actions to reduce emissions. ETA’s analysis projects that the NCEP cap-and-trade proposal would slow but not stop the 

growth of greenhouse gas emissions. ETA projects that a safety valve price of $7 

per ton would not stop or reverse emissions growth in the United States for the 

2010 to 2025 period. 

EIA analyzed one additional case as a sensitivity to determine what allowance 

prices would be necessary to reach the GHG emissions targets through 2025 as prescribed by the NCEP report. The allowance price required to reach the NCEP emissions target, which itself allows for some growth in emissions even without consideration of the ‘‘safety value’’ feature, was about $15 per metric ton of carbon dioxide 

equivalent in 2015 and $35 per ton in 2025. The necessary permit prices to reach 

the NCEP emissions targets are generally higher when the cap-and-trade program 

is implemented without the other NCEP policies or if reductions in non-energy-related GHG emissions prove to be more costly than suggested by the EPA-provided 

abatement curves used in ETA’s study. 

Question 2. Under the National Commission on Energy Policy’s proposal, what 

happens when a covered entity uses the safety valve rather than lowering emissions? What is done to ensure that emissions are actually reduced? 

Answer. When a covered entity purchases permits from the Federal Government 

instead of making changes to its use of energy, the actual emission levels will exceed the NCEP targets. Implicitly, the target is being relaxed in order to avoid the 

need for higher-cost abatement actions. 

Question 3. Under the Commission’s proposal, a company could pay the $7/ton fee 

instead of reducing the greenhouse gases. So, in the end, is there really a firm cap 

on emissions? 

Answer. Under the safety valve provision specified in the NCEP cap-and-trade 

proposal, there is no absolute cap on greenhouse gas emissions. However, when the 

permit price rises to the safety valve level, fossil fuel users and other GHG emitters 

continue to receive a price signal to reduce their emissions relative to the level of 

economic activity. 

Question 4. What policy options do you recommend to correct this [safety valve 

issue] so we can still make environmental progress? 

Answer. Because the Administration does not support the NCEP proposal, DOE 

is not in a position to offer policy recommendations for improving it.

Question 5. Has anyone looked at the cost of inaction—in other words, what the 

impact will be to the economy to not curb emissions? I’m thinking specifically of 

costs related to:

• health care due to dirtier air, 

• insurance costs due to more intense storms, 

• government emergency relief services, 

• the costs of alternative sources of water in the west as the snow pack decreases, 

• the costs of protecting homes, businesses and highways from rising sea levels, 

• farm payments due to decreased agriculture output, 

• and what the potential impact all of those increased costs will have on economic 

growth.

Answer. Consistent with its statutory mission and expertise, EIA provides only 

estimates of the economic and energy sector impacts of imposing energy-related environmental policies, such as those considered in the NCEP proposal, an analysis 

is requested by Congress or the Administration. Some of the issues raised in your 

question have been addressed in the scientific literature and in various assessment 

reports. 

(219)

* Retained in committee files. 

APPENDIX II 

Additional Material Submitted for the Record 

UNIVERSITY OF OTTAWA, 

FACULTY OF SCIENCE, 

Ottawa, Ontario, Canada, July 18, 2005. 

Hon. PETE V. DOMENICI, 

Chairman, Committee on Energy and Natural Resources, U.S. Senate, Washington, 

DC. 

DEAR MR. CHAIRMAN: I respectfully request that the attached articles be entered 

into the committee record.* I conduct research on past climates in the Arctic, and 

feel the results of my group’s work is of relevance to your hearing. 

The enclosed research publication documents our discovery of new evidence for 

past warm periods in the Arctic. The material we use is a newly discovered mineral 

deposit found in permafrost regions, and which grew some 10,000 years ago. It is 

similar to cave deposits that have been extensively used to reconstruct past temperatures in continental settings. However, this material is formed by bacterial colonies that grow under conditions of climatic improvement. It shows that the average 

summertime temperature at that time was several degrees warmer than today. 

The relevance of this work, as well as other studies that document a warm early 

Holocene climate in the Arctic, is that it emphasizes that climate change is both 

natural and dramatic. Further, the fauna and flora of the Arctic survived these very 

warm periods, and will certainly survive the natural climate warming that we have 

observed over the past century. 

I am fully in favor of decreased emissions in order to improve air quality and to 

reduce energy demands. However, Kyoto and any similar treaty that would target 

CO2 on the basis of curtailing global warming is fundamentally flawed. CO2 is a 

very, very minor greenhouse gas that has never been shown to have an impact on 

climate. Energy and emissions policies to be adopted by the U.S.A and other countries must be based on factual science. We are not affecting climate, nor can we control climate. It is driven by solar activity, and amplified by water vapor. CO2 is a 

nutrient for plants. 

I hope that this may help with your committee’s good work, 

Sincerely, 

IAN CLARK, 

Professor, Isotope Hydrology and Paleoclimatology. 

[Enclosures.] 

UNIVERSITY OF VIRGINIA, 

Charlottesville, VA July 19, 2005. 

Hon. PETE V. DOMENICI, 

Chairman, Committee on Energy and Natural Resources, U.S. Senate, Washington, 

DC. 

DEAR SENATOR DOMENICI: Along with this letter, I am sending you an article from 

the refereed scientific literature entitled ‘‘Revised 21st Century Temperature Projections,’’ authored by myself and three colleagues at the University of Virginia.*

The article demonstrates that likely temperature changes in this century are 

going to be near the low end of projections made by the United Nations’ Intergovernmental Panel on Climate Change (IPCC). This substantially reduces the prospect 

of disastrous climate change and increases the time horizon for development of new 

energy technologies. The IPCC projections are largely warmer because of unrealistic 

220

assumptions about carbon dioxide increases, and their assumption that the mathematical form of the large family of climate models, which represents scientific consensus, is wrong. These models share a common characteristic: warming, once initiated by human activity, tends to take place at a constant rate. 

I ask that you place this letter and the following article in the record as material 

relevant to the Energy and Natural Resources Committee hearing on July 21, 2005. 

Sincerely, 

PATRICK J. MICHAELS, 

Professor of Environmental Sciences. 

[Enclosure.] 

OREGON STATE UNIVERSITY, 

Corvallis, Oregon, July 19, 2005. 

Hon. PETE V. DOMENICI,

Chairman, Committee on Energy and Natural Resources, U.S. Senate, Washington, 

DC. 

DEAR SENATOR DOMENICI: I would like to submit the two attached articles for inclusion in the public record for the hearing on Arctic climate on Thursday, July 21. 

One article is a review of the recent Arctic Climate Impact Assessment and the second an overview on trends in Arctic sea ice. 

By way of introduction, please allow me to state that I have been active in meteorology and climatology since 1971 and have been recognized by the American Meteorological Society as a Certified Consulting Meteorologist. Since 1989 I have served 

as State Climatologist for Oregon, and I was a two-term President of the American 

Association of State Climatologists. My qualifications to comment on climate studies 

are very strong. 

The views expressed in the attached articles are my own and do not necessarily 

represent the policy of the State of Oregon nor my employer, Oregon State University. 

Sincerely, 

GEORGE H. TAYLOR, 

Certfiied Consulting Meteorologist. 

[Enclosures.] 

THE ARCTIC CLIMATE IMPACT ASSESSMENT—DOES IT REPRESENT A SIGNIFICANT

BREAKTHROUGH IN OUR UNDERSTANDING OF THE ARCTIC? 

Recently the Arctic Climate Impact Assessment (ACIA) report was released by the 

Arctic Council. The report documents significant ecosystem response to surface temperature warming trends that occurred in some areas since the mid-19th century 

and in the last thirty years. Among the conclusions of the report are:

• Annual average temperature in the Arctic has increased at almost twice the 

rate of the rest of the world. 

• Winter temperatures in Alaska and western Canada have increased about 3-4 

deg C over the past half century, with larger increase projected in the next 100 

years. 

• There has been widespread melting of sea ice and glaciers. The average extent 

of sea-ice cover has declined by 15-20% over the past 30 years. 

• There has been increased precipitation, shorter and warmer winters, and decreases in snow cover. 

• The area of the Greenland Ice Sheet that experiences some melting has increased about 16% since 1979.

These are just a few of dozens of conclusions, some of which involve effects plant 

and animal populations, others which describe consequences to humans (some beneficial, but most detrimental). Because the ACIA is so lengthy, I have not yet had 

a chance to thoroughly examine it. But based on a review of the Executive Summary 

(26 pages in length) and Conclusions (29 pages), I have been able to compare the 

ACIA statements with the conclusions of scientists studying the Arctic, from peerreviewed journal publications. One of these days I’ll get through the much longer 

Overview Report and perhaps update this analysis. 

Is the ACIA a breakthrough climate assessment? Does it faithfully capture the essence of climate change in the Arctic? Or is it just another doom-and-gloom report 

from the international climate community? Following is an examination of climate 

behavior in the Arctic over the last couple centuries (and earlier). 

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* Figures 1-4 have been retained in committee files. 

ARCTIC AIR TEMPERATURES

Naurzbaev, et al. (2002) created a proxy temperature data set spanning nearly 

2,500 years for the Taimyr Peninsula of northern Russia, all of which is poleward 

of 70°N. The authors studied tree rings-widths of living and deceased larch trees. 

They reported that ‘‘the warmest periods over the last two millennia in this region 

were clearly in the third, tenth to twelfth and during the twentieth centuries.’’ The 

first two, they claim, were warmer than those of the last century. Twentieth century 

temperatures appeared to peak around 1940. 

Chylek, et al. (2004) analyzed Greenland air temperatures over the last 100 years. 

At coastal stations, ‘‘summer temperatures, which are most relevant to Greenland 

ice sheet melting rates, do not show any persistent increase during the last fifty 

years.’’ The peak coastal temperatures occurred in the 1930s, followed by significant 

cooling, followed by warming; but current temperatures ‘‘are about 1° C below their 

1940 values.’’ In the highest elevations of Greenland’s ice sheet, ‘‘the summer average temperature has decreased at the rate of 2.2° C per decade since the beginning 

of the measurements in 1987.’’

The warm period in the first half of the 20th century, prior to the big increases 

in greenhouse gases, saw very rapid warming—even though CO2, reputed by many 

to be the most significant driver of temperature change, rose very little. In fact, during the decade of the 1920s at the coastal stations, ‘‘average annual temperature 

rose between 2 and 4° C [and by as much as 6° C in the winter] in less than ten 

years.’’ The authors conclude that conclude that ‘‘since there was no significant increase in the atmospheric greenhouse gas concentration during that time, the 

Greenland warming of the 1920s demonstrates that a large and rapid temperature 

increase can occur over Greenland, and perhaps in other regions of the Arctic, due 

to internal climate variability such as the NAMINAO [Northern Annular Mode/

North Atlantic Oscillation], without a significant anthropogenic influence.’’ Further, 

‘‘the NAO may play a crucial role in determining local Greenland climate during the 

21st century, resulting in a local climate that may defy the global climate change.’’ 

Contrary to the ACIA statements, CO2 increases would seem to have little or no effect on Greenland climate. 

The instrumental record demonstrates a consistent trend as well. Polyakov, et al. 

(2002, 2003b) studied a large area in the Arctic and created a history of temperature 

from 1875. They report that temperature peaked in the late 1930s, with 1937 the 

warmest single year. Since that time, there was a cooling, then a recent warming, 

but current temperatures have yet to reach the levels observed 65 years ago. 

I decided to create some temperature plots myself. Using data from the Global 

Historical Climate Network (GHCN) data base, I created graphs displaying annual 

average temperatures for all stations north of 70°N. Figure 1* shows trends from 

1970 through 2003, a period with significant warming—about 1.5° C in 33 years, 

the equivalent of 4.5° C per century, which fits right in with the ACIA’s projections. 

Now take a look at Figure 2, showing the trend from 1934 to 2003. Significant 

cooling occurred through about 1964, followed by a leveling off and then a slow rise, 

but temperatures remain cooler than they were in the 1930s. 

Finally, in Figure 3 we see the entire period, back to 1880. Overall, there is about 

a 2° C warming, but this is because the record starts with a very cold period and 

ends on a warm one. 

Fitting a linear trend (as shown) to such an oscillatory time series strikes one as 

highly inappropriate! 

These results are nearly the same as those of Polyakov, et al. (2002). 

Conclusion: while temperatures appear to have warmed in the last 40 years, a 

longer viewpoint shows much warmer temperatures in the 1930s and 1940s, apparently even warmer than those today. 

SEA ICE IN THE ARCTIC

Grumet et al. (2001) created a record of sea ice conditions in the Baffin Bay region 

of the Canadian Arctic going back 1,000 years. They concluded that the 11th 

through 14th centuries saw reduced sea ice, but that ice extent was greater over 

the next six centuries. The last century has shown that ‘‘sea-ice conditions in the 

Baffin Bay/Labrador Sea region, at least during the last 50 years, are within ‘Little 

Ice Age’ variability,’’ despite several periods of warmer temperatures. The authors 

added an interesting statement, as well, stating that the sea ice cover history of the 

Arctic ‘‘can be viewed out of context because their brevity does not account for 

222

interdecadal variability, nor are the records sufficiently long to clearly establish a 

climate trend.’’

For an area in the Greenland Sea, Comiso et al. (2001), used satellite images to 

assess the size and character of the Odden ice tongue, a 1,300 km long feature, from 

1979 to 1998. They were also able to infer its character back to the early 1920s 

using temperature measurements. The authors stated that there has been no statistically significant change in any of the parameters studied over the past 20 years. 

However, the proxy record several decades further into the past reveals that the ice 

tongue was ‘‘a relatively smaller feature several decades ago,’’ apparently as a result 

of warmer temperatures. 

Omstedt and Chen (2001) identified a proxy record of the annual maximum coverage of Baltic sea from 1720 through 1997. They stated that there was a sharp decline in sea ice in about 1877. There was also greater variability in sea ice extent 

in the first 150 years of the record, which was colder, than in the warmer period 

of the last 100 years. 

Jevrejeva (2001) reported on a longer Baltic sea ice data set from 1529 to 1990 

for the port of Riga, Latvia. The time series included four climate eras: (1) 1530-

1640, with warming accompanied by earlier ice break-up (by 9 days/century); (2) 

1640-1770, a cooler period with later ice break-up (5 days/century); (3) 1770-1920, 

with warming and a tendency toward earlier ice break-up (15 days/century); and (4) 

1920-1990, a cooling period with later ice breakup (by 12 days/century). 

Conclusion: Arctic sea ice has undergone significant changes in the last 1,000 

years, even before the mid-20th century ‘‘greenhouse enhancement.’’ Current conditions appear to be well within historical variability. 

OCEAN CONDITIONS

Polyakov, et al. (2003a) were anxious to assess reports of ‘‘extraordinary change 

in the Arctic Ocean observed in recent decades’’ made by various parties. To investigate these claims, they used temperature and salinity measurements in made winter in the central Arctic Ocean near Russia in 1973-79. They also employed 40 years 

of summer and winter observations in the Laptev Sea. 

The authors concluded that earlier reports of rapid Arctic warming ‘‘considerably 

underestimates variability.’’ Their new analyses ‘‘place strong constraints on our 

ability to define long-term means, and hence the magnitudes of [air and sea temperature] anomalies computed using synoptic measurements from the 1990s referenced to means from [earlier] climatologies.’’

Conclusion: ocean temperature histories, like those of air temperature and sea ice, 

display marked variability. We are in danger of oversimplifying the historical trends 

and misrepresenting the future if we simply assume ‘‘the Arctic Ocean is warming 

up and will continue to do so.’’

DISCUSSION

Oddly, the ACIA does a very poor job of documenting its sources of information. 

For such an ambitious document (it is hundreds of pages long, with stunning graphics and a very professional appearance) its science consists primarily of blanket 

statements without any sort of reference or citation. Were any of the references listed above considered by the ACIA team. It appears doubtful. 

The ACIA appears to be guilty of selective use of data. Many of the trends described in the document begin in the 1960s or 1970s—cool decades in much of the 

world—and end in the warmer 1990s or early 2000s. So, for example, temperatures 

have warmed in the last 40 years, and the implication, ‘‘if present trends continue,’’ 

is that massive warming will occur in the next century. Yet data are readily available for the 1930s and early 1940s, when temperatures were comparable to (and 

probably higher than) those observed today. It would appear prudent to use the 

longest reliable record for assessing trends. 

It is also inadvisable to employ the use of linear trends to represent time series 

which are cyclical in nature. The character of a trend line in a data set like the 

one shown in Figure 3 is largely a function of the starting and ending points selected. 

CONCLUSIONS

Recently National Geographic devoted an issue to ‘‘Global Warming.’’ Reading the 

ACIA brought back memories of the NG publication, and brought to mind the overall comment I made upon reviewing it: slick and beautiful but very one-sided. That 

pretty much sums up my feelings about the ACIA, based on what I have seen so 

far: nice graphics but bad science. 

223

TRENDS IN ARCTIC SEA ICE

According to the Arctic Climate Impact Assessment, published in 2004 and 2005, 

there has been widespread melting of sea ice and glaciers in the Arctic in recent 

decades; the average extent of sea-ice cover has declined by 15-20% over the past 

30 years. 

According to Environmental News Service (February 1, 2005), ‘‘Global warming 

will hit the Arctic harder and faster than the rest of the world and could cause the 

extinction of polar bears and other Arctic wildlife within 20 years, conservationists 

warn. ‘If we don’t act immediately the Arctic will soon become unrecognizable,’ said 

Tonje Folkestad, climate change officer with WWF’s International Arctic Program.’’

Many scientists, and a large number of journalists, have made similar claims. 

Below is an overview of Arctic climate science, based on reviews of scientific journal 

publications, which shows a very different picture. 

SEA ICE IN THE SUB-ARCTIC

Grumet et al. (2001) created a record of sea ice conditions in the Baffin Bay region 

of the Canadian Arctic going back 1,000 years. They concluded that the 11th 

through 14th centuries saw reduced sea ice, but that ice extent was greater over 

the next six centuries. The last century has shown that ‘‘sea-ice conditions in the 

Baffin Bay/Labrador Sea region, at least during the last 50 years, are within ‘Little 

Ice Age’ variability,’’ despite several periods of warmer temperatures. The authors 

added an interesting statement, as well, stating that the sea ice cover history of the 

Arctic ‘‘can be viewed out of context because their brevity does not account for 

interdecadal variability, nor are the records sufficiently long to clearly establish a 

climate trend.’’

For an area in the Greenland Sea, Comiso et al. (2001), used satellite images to 

assess the size and character of the Odden ice tongue, a 1,300 km long feature, from 

1979 to 1998. They were also able to infer its character back to the early 1920s 

using temperature measurements. The authors stated that there has been no statistically significant change in any of the parameters studied over the past 20 years. 

However, the proxy record several decades further into the past reveals that the ice 

tongue was ‘‘a relatively smaller feature several decades ago,’’ apparently as a result 

of warmer temperatures. 

Omstedt and Chen (2001) identified a proxy record of the annual maximum coverage of Baltic sea from 1720 through 1997. They stated that there was a sharp decline in sea ice in about 1877. There was also greater variability in sea ice extent 

in the first 150 years of the record, which was colder, than in the warmer period 

of the last 100 years. 

Jevrejeva (2001) reported on a longer Baltic sea ice data set from 1529 to 1990 

for the port of Riga, Latvia. The time series included four climate eras: (1) 1530-

1640, with warming accompanied by earlier ice break-up (by 9 days/century); (2) 

1640-1770, a cooler period with later ice break-up (5 days/century); (3) 1770-1920, 

with warming and a tendency toward earlier ice break-up (15 days/century); and (4) 

1920-1990, a cooling period with later ice breakup (by 12 days/century). 

MOVING POLEWARD

Laxon, et al. (2003) were motivated by a ‘‘mismatch between the observed variability and that predicted by models.’’ Unfortunately, the ‘‘sparseness of sea ice thickness observations’’ in the Arctic means that the ‘‘regional and interannual variability of sea ice thickness is entirely based on models of the Arctic.’’ They found 

high-frequency interannual variability which runs counter to what the models say. 

In conclusion, ‘‘Until models properly reproduce the observed high-frequency, and 

thermodynamically driven, variability in sea ice thickness, simulations of both recent, and future, changes in Arctic ice cover will be open to question.’’

Polyakov, et al. (2002) studied sea ice cover over the Kara, Laptev, East Siberian 

and Chukchi Seas north of Russia. Sea ice cover trends were ‘‘smaller than expected’’ and ‘‘do not support the hypothesized polar amplification of global warming.’’ In a later report, Polyakov et al. (2003b) stated that ‘‘long-term ice thickness 

and extent trends are small and generally not statistically significant’’; in fact, ‘‘over 

the entire Siberian marginal-ice zone the century-long trend is only 0.5% per decade,’’ or 5% per century.’’

A number of researchers have suggested that inflows of Atlantic water into the 

Arctic profoundly affect temperatures and sea ice trends in the latter ocean. 

Polyakov, et al. (2004) are among these. The first sentence of their paper states ‘‘Exchanges between the Arctic and North Atlantic Ocean have a profound influence on 

the circulation and thermodynamics of each basin.’’ The authors attributed most of 

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* All graphs have been retained in committee files. 

the variability to multidecadal variations on time scales of 50-80 years, with warm 

periods in the 1930s-40s and in recent decades, and cool periods in the 1960s-70s 

and early in the 20th century. These are associated with changes in ice extent and 

thickness (as well as air and sea temperature and ocean salinity). The most likely 

causative factor involves changes in atmospheric circulation, including but not limited to the Arctic Oscillation. 

It is tempting to employ satellite data to estimate sea ice trends (see, for example, 

Parkinson, et al., 1999; and Parkinson, 2000). Granted, satellites are marvelous 

tools for such surveys, but their data sets are limited to only the last several decades. According to Schmith and Hansen (2003), trend studies of Arctic sea ice conditions ‘‘should be regarded with some care’’ since the period of satellite observations 

coincided with but one phase of a clear multidecadal oscillation. Studying observations for the period 1820-2000, the researchers used ice observations to estimate ice 

export in waters off Greenland. One parameter which shows multidecadal variability is the correlation between ice export and the North Atlantic Oscillation (NAO); 

see trends below. In recent decades there has been a strong correlation between the 

two, as there was in the 1930s-40s. During the 1960s-70s and from about 1870-1920 

there were much lower correlations. This ‘‘casts doubt on the hypothesis of enhanced 

greenhouse effect being the cause’’ for recent NAO-sea ice correlations, according to 

Schmith and Hansen (2003).* 

Rigor, et al. (2002) suggest that the Arctic Oscillation (AO) affects surface air temperatures and sea ice thickness over the Arctic in a profound way. Ice thickness responds primarily to surface winds changes caused by the AO, whose long-term 

trends are shown below. 

Parkinson (2000) seems to have identified decadal or longer trends as well. The 

analysis described in that paper divided the Arctic into nine regions. In seven of the 

nine the sign of the trend ‘‘reversed from the 1979-1990 period to the 1990-1999 period,’’ which is another reason to be cautious when evaluating relatively short data 

sets. 

Holloway and Sou (2002) used data from ‘‘the atmosphere, rivers and ocean along 

with dynamics expressed in an ocean-ice-snow model.’’ The authors warn against 

using any linear trend longer than 50 years due to multidecadal variability, which 

included ‘‘increasing volume to the mid-1960s, decadal variability without significant trend from the mid-1960s to the mid-1980s, then a loss of volume from the 

mid-1980s to the mid-1990s. They also suggest that changes in wind patterns play 

a large role in ice thickness changes and that ‘‘Arctic sea ice volume has decreased 

more slowly than was hitherto reported.’’ In fact, ‘‘the volume estimated in 2000 is 

close to the volume estimated in 1950.’’

INTERDECADAL VARIABILITY

Again and again we see terms ‘‘decadal,’’ interdecadal’’ or ‘‘multi-decadal’’ in describing Arctic sea ice conditions. You have seen the similarity of the NAO and AO 

and can view the long-term variability. Note that in the NAO and AO charts that 

1970 (a starting point for many of the time series being mentioned) occurred at a 

time of minimum NAO and AO value. 

Now consider a data set from the WARM part of the world, the Pacific Decadal 

Oscillation (PDO). Below annual values of the PDO. In the following chart I have 

plotted the NAO, AO and PDO together, with 19-year smoothing to show long-term 

trends. The final chart shows surface air temperature in the Arctic, from Polyakov, 

et al. (2002), showing striking multidecadal variations. 

WHAT THIS TELLS US

If we want to understand variability of Arctic sea ice (and, for that matter, sea 

and air temperature) we should take our eyes off greenhouse gases, at least for a 

moment, and study multidecadal phenomena. We should also avoid the temptation 

of taking the last 20-30 years of data, computing a trend, and assuming that that 

trend will continue for 50-100 years. History tells us that long-term linear trends 

will not occur. In the words of Santayana, ‘‘Those who cannot remember the past 

are condemned to repeat it.’’ Or make bad forecasts. 

225

* All charts have been retained in committee files. 

STATEMENT OF GLENN KELLY, EXECUTIVE DIRECTOR, ALLIANCE FOR CLIMATE

STRATEGIES, WASHINGTON, D.C. 

Mr. Chairman and Members of the Committee, the Alliance for Climate Strategies 

(ACS) appreciates the opportunity to submit the following statement for the record 

regarding the actions our member industries are taking to address climate and 

emissions issues. 

ALLIANCE FOR CLIMATE STRATEGIES DESCRIPTION

ACS is a broad-based advocacy coalition of industry sectors created to:

• Exemplify the principle that voluntary actions are an effective means of reducing greenhouse gas (GHG) emissions. • Demonstrate that the ingenuity and technological expertise of American industry can achieve meaningful reductions in GHG emissions.

Membership in the Alliance includes the following eight trade associations:

• American Chemistry Council. • American Forest & Paper Association. • American Petroleum Institute. • American Road & Transportation Builders Association. • Edison Electric Institute. • Nuclear Energy Institute. • National Mining Association. • National Rural Electric Cooperative Association.

ACS members believe that a ‘‘do nothing’’ option clearly seems imprudent, especially when common-sense, cost-effective strategies are available that will support 

technology development and deployment while creating jobs and sustaining economic growth. Members of ACS also believe that the costs and consequences of a 

mandatory cap-and-trade program will severely impact every state and congressional district in the nation by raising household consumer costs and reducing job 

opportunities while doing little if anything to address the global nature of the climate issue. 

Our statement will address the following four topics:

• Carbon Dioxide Emissions Trends (U.S. and Abroad). • GHG Measuring and Reporting. • Ongoing Voluntary Initiatives and Investment. • Technology Research, Development & Deployment.

There often is a misperception that due to the general opposition to mandatory 

GHG emissions reduction caps, industry is doing nothing on the issue. Nothing 

could be farther from the truth. U.S. industries, in fact, have a well established and 

successful record of voluntary GHG management initiatives that is strong today and 

continues to grow. Government strategies and policies that provide investment stimulus to develop and deploy existing and new low-carbon and zero-carbon technologies will help to continue and expand this successful record of voluntary initiatives. 

CARBON DIOXIDE EMISSIONS TRENDS (U.S. AND ABROAD)

The Energy Information Administration (ETA) reports that carbon dioxide (CO2) 

accounts for approximately 85 percent of U.S. GHG emissions. The remainder includes the GHGs methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons and 

sulfur hexafluoride. While all of these are important, it is easy to see why the focus 

is on CO2; on a global warming potential basis it accounts for almost 85 percent of 

total U.S. GHG emissions. Because more than 95 percent of the CO2 emissions come 

from energy, energy quickly becomes the focus for many people. 

Looking at energy-related CO2 emissions in round numbers, about one-third 

comes from transportation, a little less than one-third comes from industry, and a 

little more than one-third comes from residential and commercial sectors combined. 

These sector numbers include allocated electricity emissions. Roughly three-fourths 

of residential and commercial emissions are associated with electricity, while in the 

industrial sector, less than 40 percent is associated with electricity. 

Looking at trends over 1990-2003 (see chart* above), U.S. GDP grew about 3 percent per year, but overall energy-related CO2 emissions grew only 1.1 percent per 

year. CO2 emissions from the residential and commercial sectors grew about 2 percent per year, while transportation grew less than 1.5 percent per year. But the big 

226

message here is that industrial CO2 emissions from energy actually declined—that 

is, without mandatory GHG programs, industrial sector emissions were lower in 

2003 than they were in 1990.

Turning to global trends, a couple of key realities are evident. First, following a 

substantial drop in Eastern Europe/Former Soviet Union emissions with the collapse of the former Soviet Union just after 1990, emissions trends are now clearly 

upward in those countries. Second, developing country emissions were about 40 percent below those of industrialized countries in 1990 but by 2020 are projected to be 

more than 10 percent above developed country emissions. Third, driven largely by 

efforts by China and India to improve their citizens’ standard of living, between 

2000 and 2020 developing country CO2 emissions are projected to increase by 71 

percent, but developed country emissions increase by only 23 percent. Addressing 

global GHG emissions without involving the developing countries is really an exercise in futility. 

Looking more closely at the E.U. major 15 countries, the chart below illustrates 

the report of the European Environmental Agency (EEA) evaluating whether the 

E.U.-15 countries are on track to meet their Kyoto Protocol commitments for 2008-

2012. In the chart, the green-colored bars are positive and the red-colored bars are 

negative. Only the U.K. and Sweden are ‘‘green,’’ and the remainder of this graphic 

is ‘‘red,’’ meaning the EEA concludes that these countries are not on track to meet 

their burden-sharing targets. 

Clearly, many of the E.U.-15 countries are way above the emission trends required to meet their targets. Additionally, the E.U. Emissions Trading System went 

into operation on January 1, 2005—even though some of the basic plans were yet 

to be completed—to say nothing of the institutions needed to administer the trading 

system. The message here is capping and actually reducing GHG emissions is a serious and difficult challenge in any country. Western Europe is having difficulty meeting its Kyoto Protocol commitments, and actions that have been too difficult to 

adopt thus far may well be required. And circumstances in the U.S. are far different 

from those in Europe. EIA projects West European population growth to amount to 

less than 10 million over 2000-2020. Contrast that with the U.S.—where population 

is projected to increase by about 60 million people by 2020—and one can quickly 

see the challenges that lie before us. 

Based on data from ETA’s International Energy Outlook 2004, the U.S. is making 

strong progress on reducing the carbon intensity of economic activity. Intensity reductions in Germany and the U.K. exceed those in the U.S., but Germany benefited 

from shutting down highly inefficient East German factories with reunification, and 

the U.K. had massive reductions in coal use by switching to natural gas. But U.S. 

reductions in the ratio of carbon (from energy) to GDP exceed those of the other 

Western European countries as well as Japan and Canada—all of whom have ratified the Kyoto Protocol. (See chart below.) 

While the Europeans are struggling with their Kyoto Protocol requirements, some 

in the U.S. advocate GHG emissions caps. Proposals from Senators McCain and 

Lieberman and from Senator Bingaman are two such examples. One issue often 

overlooked is the sheer size of some of these cap and trade proposals. 

Some invoke the success of the sulfur dioxide (SO2 or acid rain) program as an 

argument for using GHG emission allowances. However, there are huge differences 

between the SO2 program and the programs envisioned under current cap and trade 

proposals. First, there are commercially available end-of-the-stack control technologies for SO2, but not for CO2—at least until carbon capture and geologic storage 

becomes cost effective. Second, the SO2 program covers only a single industry, while 

GHG cap and trade proposals would impact the entire U.S. economy. Third, the SO2

program has about 9 million tons of allowances, while the McCain-Lieberman bill, 

as one example, has almost 6 billion tons of allowances, plus a complicated and uncertain number of ‘‘offsets.’’ Fourth, the acid rain program had a market value of 

allowances of about $1.5 billion in 2003. But in 2010, ‘‘issued allowances’’ under the 

McCain-Lieberman bill would have a market value of $80-$115 billion, according to 

the EIA. By 2025, such a program would have a market value of $245-$278 billion. 

The magnitude of a McCain-Lieberman proposal is not often appreciated. A comparison of the acid rain program is noted in the following chart: 

That is a quick overview of global GHG emission trends, what industry has accomplished over the past decade, and the real-world difficulties posed by mandatory 

programs. We would like to turn now to a discussion of voluntary reporting and 

measurement. 

227

GHG MEASURING AND REPORTING

We would like to make it clear that U.S. industry is taking significant steps to 

measure and report emissions voluntarily, and we would like to highlight to the 

Committee some of the activities that ACS members are undertaking as participants in the Climate VISION program of the Department of Energy (DOE) (see 

below). 

The first step in addressing emissions is learning to measure emissions accurately. Industrial processes are highly varied—ranging from complex systems to single units—and they use different types of fuels in different ways. Converting fuel 

usage to emissions requires careful collection and organization of data and selection 

of correct conversion factors. Industry is aggressively working to address these 

issues. 

The first step in calculating emissions is adoption of a protocol. This is a plan or 

general outline of what type of data will be collected and how it will be combined. 

The second step—and probably the most important—requires developing methods 

that are specific to each industry. This involves identifying operations, establishing 

accounting boundaries, collecting data, and finding emissions factors. For diverse industries with varying operations, each of these steps is critical and must be carefully tested to assure that the method is accurate and that data collection is feasible. Once the method is established, spreadsheets can be created to facilitate the 

actual calculation. 

We call the Committee’s attention to an example from the oil and gas industry 

that shows how critical the methodology is in calculating emissions (see chart 

below). 

This chart shows the variation that can occur in estimating emissions. Looking 

from left to right across the graph, API compared the methane emissions from an 

on-shore oil production facility using its Compendium and methods developed by 

Latin American Oil and Gas Industry (ARPEL), the Environmental Protection Agency (EIIP), the European exploration and production industry (E&P Forum), the Canadian industry (CAAP), and the United Nations Intergovernmental Panel on Climate Change (IPCC). 

The results show that the various methods produced estimates of methane emissions that vary by more than fivefold. This clearly shows the variability in calculating emissions, especially emissions from non-combustion sources (the solid area 

on the bar chart). API is working to get its Compendium adopted as a single, comprehensive and consistent method for estimating GHG emissions from oil and gas 

facilities worldwide. 

The forest products industry represents a different operating situation. At pulp 

and paper mills more than 90 percent of emissions come from stationary combustion 

of fossil fuels; thus, the emission factors proposed by the IPCC were a good starting 

point. In early 2001, the pulp and paper industry, working with its international 

counterparts, began a project to develop a global methodology for estimating GHG 

emissions. The resulting industry-specific calculation tools were based on protocols 

developed by World Resource Institute (WRI) and World Business Council on Sustainable Development (WBCSD) and were subsequently peer reviewed and adopted 

as the WRI/WBCSD pulp and paper mill module. The complete tools include a stepby-step description of the process and a spreadsheet to make the calculation process 

easy. The forest products industry also developed a similar tool for wood products 

facilities. This tool is also undergoing the WRI/WBCSD review process. Other industries—cement, aluminum, iron and steel, and mining—are creating similar modules 

based on the WRI/WBCSD protocol. 

Finally, utilities currently report virtually all of their GHG emissions to the EPA 

under the Clean Air Act. Utilities that purchase fuel to generate electricity use a 

fairly consistent process. Thus, ‘‘continuous emissions monitors’’ applied to the 

stacks and estimated fuel-use data can be used to calculate CO2 emissions. Using 

this approach, it is estimated that utilities are reporting 99.9 percent or more of 

their emissions to EPA. This information is published annually at the sector level 

by the EPA. 

Starting in 1994, the power sector was one of the first to begin reporting of voluntary efforts under the Energy Policy Act of 1992 section 1605(b) program to the 

EIA. In 2003, the sector had reported about 261 million tons of CO2-equivalent 

emission reductions from direct emission reductions, avoided emissions and sequestration. The level of reported reductions by utilities has increased almost every year 

since the program began. Power sector members plan to continue reporting their 

GHG emission reduction activities under the 1605(b) program. Other industries will 

be reporting emission reductions as part of their Climate VISION commitment. 

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ONGOING VOLUNTARY INITIATIVES & INVESTMENT

We would also like to highlight the voluntary programs and initiatives that member associations of ACS are undertaking as part of the Climate VISION program. 

In 2002, President Bush challenged the nation to reduce its GHG emissions intensity 18 percent by 2012 through voluntary actions. As part of the President’s strategy, he created the Climate VISION (Voluntary Innovative Sector Initiatives: Opportunities Now) program, housed at DOE. Under the program, industries—working 

with various federal agencies—commit to voluntarily reduce their GHG emission intensities. To date, 14 industry associations, representing more than 90 percent of 

U.S. industrial GHG emissions, have announced voluntary pledges and programs. 

One of the most important tools for achieving the intensity reduction goal will be 

company activities. Some of these activities will occur through individual company 

initiatives, such as those under the EPA Climate Leaders program, and others 

through industry-wide initiatives, such as PowerTree Carbon Company. PowerTree 

Carbon Company is an initiative sponsored by 25 U.S. power companies—including 

investor-owned utilities and cooperatives—to plant trees in critical habitats in the 

Lower Mississippi River Valley to manage CO2. 

Yet another element of company activities will be the use of numeric goals to 

drive internal actions. The Climate Leaders website contains a partial listing of 

such actions. 

Late last year, the power sector signed a memorandum of understanding (MOU) 

with DOE to achieve the equivalent of a 3-5 percent reduction in its carbon intensity 

by 2012. Actions under a work plan will include achieving credible, verifiable reductions in carbon intensity or offsets of GHGs through a range of individual company 

actions, industry-wide initiatives and cross-sector efforts. EEI members, for example, will work with their counterparts in the other power sector trade associations 

to help achieve this voluntary numeric goal. 

In addition, NRECA and the Department of Agriculture earlier signed an MOU 

to identify and advance technologies that will help achieve the national goal. Initially NRECA is working with its members and the Agriculture Department to 

eliminate technical and market barriers to the use of low-emission renewable energy, such as agricultural waste-to-electricity, through the use of systems approaches and the development of decision-support tools. 

Other ACS members have similar agreements, such as: 

American Forest & Paper Association 

AF&PA members plan to reduce their emissions intensity by 12 percent by 2012 

through:

• Developing new, energy-efficient technologies that use renewables and biomass 

energy and that, if fully commercialized, could make the forest products industry energy-self sufficient. 

• Increasing paper recovery for recycling, which avoids GHG emissions by keeping paper out of landfills. 

• Enhancing carbon storage in forests, which remove CO2 from the atmosphere 

and store it for long periods of time. 

• Enhancing carbon storage in wood and paper products, which continue the process of withholding carbon from the atmosphere. 

American Petroleum Institute

• 100 percent participation in Natural Gas Star and combined heat and power 

programs. 

• 10 percent improvement in aggregate refinery energy efficiency over 2002-2012. 

• Develop GHG management plans. 

National Mining Association 

• Reductions through research under DOE-NMA Industry of the Future program. 

• Calculate industry efforts to sequester carbon on reclaimed mine lands. 

• Develop voluntary reporting methodology. 

• Additional reductions from coal mine methane recovery where feasible.

Industry has responded to the Climate VISION challenge. ACS members are taking actions that will result in real and substantial GHG reductions now, not in the 

future—and without the need for mandatory actions. Furthermore, industry is taking significant steps to measure and report emissions voluntarily, and we wanted 

to take this opportunity to tell you about some of the things that we, as members 

of Climate VISION, are doing. 

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TECHNOLOGY RESEARCH, DEVELOPMENT & DEPLOYMENT

All energy resources along with efficiency and conservation will be needed to meet 

our nation’s growing demand for energy and electricity. It is important that we develop and put into commercial operation technologies that will allow us to use these 

resources with as low an emissions profile as possible. 

One way that will allow our economy to grow with lower emissions is to continue 

to develop ways to use energy more efficiently. In the last 20 years, we have reduced 

the amount of energy we need for each dollar of GDP by 40 percent. This trend will 

continue on a nationwide basis, but to be more specific: 

Many of the industries that are associated with ACS are working with DOE in 

a program called Industries of the Future, in which they are jointly funding research to make their operations more efficient. These projects are short term—they 

will have an impact in the next few years. 

Cogeneration—a process where the waste heat that is produced when making 

electricity is captured and used—is a relatively new example of efficiency in action. 

And that is just the tip of the iceberg. It is only good business to produce more with 

less energy, and all industry is working toward that goal. 

Some technologies, such as nuclear power and renewable technologies, have no 

carbon emissions, and it is important that public policies support, not constrain, 

their increased use. 

Wind, solar and biomass are the most promising of the renewable technologies, 

and technological advancements are lowering the cost of these every year. The 

amount of electricity generated from wind power, although still small, has doubled 

since 2000. The use of solar and biomass is also increasing. 

Now just a few words about nuclear power—our largest source of non-carbonemitting electricity generation. The U.S. has 103 operating nuclear plants producing 

close to 20 percent of our electricity. In the absence of nuclear power, U.S. electric 

sector carbon emissions would be almost 30 percent higher, according to calculations 

by the Nuclear Energy Institute (based on data from EIA). Given the volume of carbon emissions prevented by nuclear power plants, it is clear that the U.S. cannot 

have a plausible long-term climate program without a growing contribution from nuclear power. 

The electric power industry is moving forward with a program that will lead to 

construction of new nuclear plants in the U.S., and there is significant progress on 

that score. The licensing process has been overhauled, and the Nuclear Regulatory 

Commission is reviewing several new standardized designs. Three companies have 

submitted applications for early site permits, and two consortia are preparing applications for construction and operating licenses. And the Tennessee Valley Authority 

is leading a third consortium, evaluating the feasibility of building new nuclear 

plants at its Bellefonte site in Alabama. If all goes well, the nuclear industry will 

have units under construction by 2010 with significant numbers of new nuclear 

plants built during the next decade. 

But, as mentioned previously, we need all forms of energy to meet future demands, and this means that we will continue to use all fossil fuels—coal, oil and 

natural gas—well into the future. Although we are working to minimize emissions 

from fossil fuel use, we also have to look at ways to capture and permanently 

store—or sequester—CO2 emissions. In some instances, this can be done directly as 

the energy is used. In other cases, where CO2 cannot be directly captured, we have 

to look at ways to offset emissions, for example, through the capture of CO2 from 

the air and then storage of this CO2 in forests, plants or grasses. This is terrestrial 

sequestration; in the short term, this is probably the best way to capture and store 

CO2. Many of our companies have terrestrial sequestration programs that are on the 

ground and working now. The forest products industry is working to increase research on forest sequestration and has established the Forest Carbon Consortium 

to promote research on the potential of managed forests to store carbon and produce 

energy. 

Storage of carbon in plant life is not the only way to go. Carbon can be stored 

in geologic formations on land and in the ocean. A number of companies in the industries represented by ACS members are part of the joint industry-government Regional Carbon Sequestration Partnerships that were started about two years ago 

with the goal of determining the most suitable technologies, regulations and infrastructure for carbon capture, storage and sequestration in each region of the country. 

Internationally, our government formed the Carbon Sequestration Leadership 

Forum, which brings governments and industry from all over the world to share information and conduct joint research in order to find ways to sequester carbon more 

efficiently and cost effectively. ACS members are involved in this initiative. 

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Finally, DOE has initiated a joint government-industry research program to find 

safe ways to store carbon in geologic repositories. The Electric Power Research Institute (EPRI)—a research arm of the electric utility industry—has a pilot-scale test 

center for CO2 capture and containment. EPRI has developed site-selection criteria 

for CO2 sequestration, and is in the process of selecting a site to test long-term underground CO2 storage. 

We are also working on projects that will result in lower emissions when we use 

fossil fuels—in particular, coal and petroleum products. These projects are both 

short and long term. The Clean Coal Technology Industry-DOE partnership is well 

established—it started in 1986 to address SO2 and nitrogen oxide issues. Over time, 

the program has evolved, and technologies, such as integrated gasification combined 

cycle (IGCC), have been developed to use our vast coal resource more cleanly—with 

lower emissions and more efficiency. This means lower CO2 emissions for each unit 

of electricity produced. Many of these are new or very near-term technologies. These 

are important, as coal provides more than 50 percent of the electricity used in our 

country now and is expected to maintain this share in the future. 

Industry is also working on research that will have benefits in the long term. For 

example, a number of coal and utility companies are involved with DOE in a project 

called FutureGen, which is an initiative to build the world’s first zero-emissions 

coal-fired power plant. This will be a commercial scale IGCC plant that produces 

electricity and hydrogen. The CO2 will be captured and sequestered. This is an important part of the Administration’s effort to move our economy—over the long 

term—to a hydrogen-based economy. Hydrogen will be made from many fuels, including coal and natural gas. 

There are a number of transportation initiatives that will result in reduced emissions over time. In the short term, the CO2 diesel project that is just beginning will 

test the capability of using biofuels in large-scale mining operations in Nevada and 

Indiana. Utilities are working with DOE to develop and test a commercial hybrid 

work truck that will mean lower CO2 emissions, and the automobile industry is an 

active participant in the Freedom Car project. 

These examples are illustrative of the many research projects that are ongoing to 

develop technologies that will result in lower emissions in both the short and long 

term. 

CONCLUSIONS

The often-stated claim that the U.S. industrial sector is not responsive to concerns 

about GHG emissions and climate change is unfounded. Indeed, the U.S. industrial 

sector, largely represented by ACS, is working to address emissions concerns 

through a variety of means—voluntary initiatives, government partnerships, and 

technology research, development and deployment. ACS members are proud of the 

achievements to date that are outlined above and look forward to more positive 

progress. No other sector of the U.S. economy can claim this level of progress. 

Thank you, Mr. Chairman and Members of the Committee, for the opportunity to 

submit this statement. ACS and member companies stand ready to assist your efforts to address this important policy issue. 

STATEMENT OF THE GEORGIA INSTITUTE OF TECHNOLOGY

HURRICANES ARE GETTING STRONGER, STUDY SAYS

Atlanta (September 15, 2005)—The number of Category 4 and 5 hurricanes worldwide has nearly doubled over the past 35 years, even though the total number of 

hurricanes has dropped since the 1990s, according to a study by researchers at the 

Georgia Institute of Technology and the National Center for Atmospheric Research 

(NCAR). The shift occurred as global sea surface temperatures have increased over 

the same period. The research will appear in the September 16 issue of the journal 

Science, published by the AAAS, the science society, the world’s largest general scientific organization. 

Peter Webster, professor at Georgia Tech’s School of Earth and Atmospheric 

Sciences, along with NCAR’s Greg Holland and Tech’s Judith Curry and Hai-Ru 

Chang, studied the number, duration and intensity of hurricanes (also known as typhoons or tropical cyclones) that have occurred worldwide from 1970 to 2004. The 

study was supported by the National Science Foundation (NSF). 

‘‘What we found was rather astonishing,’’ said Webster. ‘‘In the 1970’s, there was 

an average of about 10 Category 4 and 5 hurricanes per year globally. Since 1990, 

the number of Category 4 and 5 hurricanes has almost doubled, averaging 18 per 

year globally.’’

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Category 4 hurricanes have sustained winds from 131 to 155 miles per hour; Category 5 systems, such as Hurricane Katrina at its peak over the Gulf of Mexico, feature winds of 156 mph or more. 

‘‘This long period of sustained intensity change provides an excellent basis for further work to understand and predict the potential responses of tropical cyclones to 

changing environmental conditions’’, said NCAR’s Holland. 

‘‘Category 4 and 5 storms are also making up a larger share of the total number 

of hurricanes,’’ said Curry, chair of the School of Earth and Atmospheric Sciences 

at Georgia Tech and co-author of the study. ‘‘Category 4 and 5 hurricanes made up 

about 20 percent of all hurricanes in the 1970’s, but over the last decade they account for about 35 percent of these storms.’’

The largest increases in the number of intense hurricanes occurred in the North 

Pacific, Southwest Pacific and the North and South Indian Oceans, with slightly 

smaller increases in the North Atlantic Ocean. 

All this is happening as sea-surface temperatures are rising across the globe-anywhere from around one-half to one degree Fahrenheit, depending on the region, for 

hurricane seasons since the 1970’s. 

Research suggests that rising sea surface temperatures could mean more storms 

of the same intensity of Hurricane Katrina. 

‘‘Our work is consistent with the concept that there is a relationship between increasing sea surface temperature and hurricane intensity,’’ said Webster. ‘‘However, 

it’s not a simple relationship. In fact, it’s difficult to explain why the total number 

of hurricanes and their longevity has decreased during the last decade, when sea 

surface temperatures have risen the most.’’

‘‘NCAR is now embarking on a focused series of computer experiments capable of 

resolving thunderstorms and the details of tropical cyclones,’’ said Holland. ‘‘The results will help explain the observed intensity changes and extend them to realistic 

climate change scenarios.’’

The only region that is experiencing more hurricanes overall is the North Atlantic, where they have become more numerous and longer-lasting, especially since 

1995. The North Atlantic has averaged eight to nine hurricanes per year in the last 

decade, compared to the six to seven per year before the increase. Category 4 and 

5 hurricanes in the North Atlantic have increased at an even faster clip: from 16 

in the period of 1975-89 to 25 in the period of 1990-2004, a rise of 56 percent. 

A study published in July in the journal Nature came to a similar conclusion. Focusing on North Atlantic and North Pacific hurricanes, Kerry Emanuel (Massachusetts Institute of Technology) found an increase in their duration and power, although it used a different measurement to determine a storm’s power. 

But whether all of this is due to human-induced global warming is still uncertain, 

said Webster. ‘‘We need a longer data record of hurricane statistics, and we need 

to understand more about the role hurricanes play in regulating the heat balance 

and circulation in the atmosphere and oceans.’’

‘‘Basic physical reasoning and climate model simulations and projections motivated this study,’’ said Jay Fein, director of NSF’s climate and large scale dynamics 

program, which funded the research. ‘‘These results will stimulate further research 

into the complex natural and anthropogenic processes influencing these tropical cyclone trends and characteristics.’’

Webster is currently attempting to determine the basic role of hurricanes in the 

climate of the planet. ‘‘The thing they do more than anything is cool the oceans by 

evaporating the water and then redistributing the oceans’ tropical heat to higher 

latitudes,’’ he said. 

‘‘But we don’t know a lot about how evaporation from the oceans’ surface works 

when the winds get up to around 100 miles per hour, as they do in hurricanes,’’ 

said Webster, who adds that this physical understanding will be crucial to connecting trends in hurricane intensity to overall climate change. 

‘‘If we can understand why the world sees about 85 named storms a year and not, 

for example, 200 or 25, then we might be able to say that what we’re seeing is consistent with what we’d expect in a global warming scenario. Without this understanding, a forecast of the number and intensity of tropical storms in a future 

warmer world would be merely statistical extrapolation.’’

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