The EPA's Clean Power Plan promises to be an historically significant turning point in the global effort to tackle climate change
Has Barack Obama just secured his legacy? For all the undoubted and inevitable disappointments of his time in office, the Nobel Prize winning, healthcare reform delivering, Great Depression avoiding, dual election winning first African-American President, already has a track record that stands comparison with the vast, vast majority of his 43 predecessors.
But could his Clean Power Plan secure Obama a legacy that echoes through the ages, establishing him as the world leader who sparks the crucial deployment phase for the global low carbon economy? We'll have to wait 30 or 40 years to find out, but the chances of Obama being remembered as a globally significant figure in the multi-generational battle to tackle climate change will today receive a massive boost.
Obama might have taken the best part of seven years to get from the point when he was elected on the promise of delivering meaningful action to cut US greenhouse gas emissions to today's announcement of rules requiring a 32 per cent cut in power plant emissions. He might have blotted his copybook with many environmentalists through his vacillating on the KeystoneXL pipeline, his failure to take a stronger line on fracking, and worst of all his support for Arctic drilling. But when White House adviser Brian Deese said the new EPA rules marked the "biggest step that any single president has made to curb the carbon pollution that is fueling climate change" he wasn't exaggerating. The rules and the politically savvy manner in which the Obama administration have circumnavigated Congress - which has too often sought to condemn itself to irrelevance in this debate through its scientifically illiterate throwing of metaphorical and actual snowballs - represents an historic achievement.
The detail of the announcement is, of course, hugely important. The decision to increase the overall target to a 32 per cent cut in emissions from power plants while giving states a couple of extra years to comply with the rules looks like a good trade off. Meanwhile, the focus on renewables represents great news for clean tech developers and less good news for frackers (who will inevitably still benefit from the restrictions on coal emissions). The move to give states freedom to introduce their own flexible plans - backed by a strong legal threat to impose plans on those that refuse to draw up their own - is a political and administrative masterstroke. It may create a patchwork of regulations and clean energy policy regimes across the US that could create challenges for some business and investors, but it also promises a race to the top amongst progressive states while guaranteeing some form of action across the board.
The legal and political saga the regulations will play in to is also hugely important. The EPA and the Obama administration can expect to come under sustained legal attack over the new rules. But officials appear remarkably confident the plan is built on the strong foundations provided by the 2007 ruling that greenhouse gas emissions are a threat to human health and can be regulated under the Clean Air Act. As long as that ruling holds, the EPA is under a legal obligation to act to curb emissions. Those seeking to neuter the rules appear to have no answer to this legal reality.
Meanwhile, politically Obama and, perhaps more importantly given the point in the electoral cycle, Hillary Clinton have evidently concluded there are more votes in delivering climate action than opposing it. The polls indicate they are making a smart bet. In contrast, the Republican Party continue to allow opposition to clean energy investment and outright climate denialism to play a central role in the on-going psychodrama that is the Party's continued experiment in how best to destroy the GOP's election-winning coalition of voters. As with so much of the Republican's Fox News led agenda, the Party has found a way to fire up its base while ignoring the fact it alienates the centrist voters needed to secure the White House.
The caveats are also hugely important. As with anything in politics there is a risk that the long term stability and ambition promised by these regulations proves illusory. Legal action could delay the rules, even if it seems unlikely at this stage they can be overturned. A shock Republican victory next year (and looking at the field of candidates so far, it would be a shock) could scupper the regulations. Some recalcitrant states will no doubt test the limit of the law and simply refuse to deliver clean power investment programmes. The fossil fuel industry and its allies in heavy industry will not give up without a fight and some firms will no doubt double down on the lobbying dark arts in an attempt to defeat the plan, rather than respond to the new reality and step up investment in clean tech R&D. Most importantly, Obama's plan is still not compatible with the scale of deep emissions reductions many scientists warn us are needed.
Obama's legacy is not secured just yet, even if it is notable that much of the opposition to the rules is so confused it cannot work out whether to attack them for being unworkable or for bringing about the end of high carbon energy industries.
However, the most important aspect of Obama's Clean Power Plan is to be found not in the legalese detail of the rules, nor the inside the beltway political battles it triggers, but in the mood music it creates, the investment signals it sends.
The Clean Power Plan is just the latest, and arguably most high profile, addition to a global trend. Namely, the march of policies and pledges that confirm decarbonisation is now one of the defining long-term economic and infrastructure goals of the world's greatest economies. The EU is signed up to a similar goal to cut emissions 30 per cent by 2030, China is deploying policies and investment to ensure it ensures emissions peak around the same time, and now the US has backed up vehicle emissions standards with a commitment to transform its energy sector.
The Obama plan also further strengthens the climate policy approach du jour. In giving state governments the freedom to develop decarbonisation policies that work for them, the plan consciously echoes both the UN's proposed system of national climate action plans or INDCs and the EU's long-standing and largely successful emissions reduction efforts. It is increasingly clear governments are settling on a flexible climate policy approach that works (albeit at too slow a pace), combining efficiency measures and clean technologies in a way that curbs emissions without undermining growth. Recent data suggesting a decoupling at a global level of economic and emissions growth offers further evidence this model can hopefully work at a planetary scale.
This system of national and regional programmes is a long way short of being perfect and it cannot be said often enough that current emissions targets are not in line with what the science recommends. But nor is it nothing. The Obama plan and the growing optimism around the Paris talks promise to deliver clear, long term decarbonisation commitments in every major economy in the world coupled with coherent programmes for moving towards that ambitious goal.
Businesses and investors assessing this trend dispassionately will come to the same conclusion: what these economic superpowers are trying to achieve is supremely challenging, but they can't all be lying when they say they are serious about delivering decarbonisation. Obama's plan offers yet another reminder the balance of power in favour of clean technology over polluting fuels is shifting, and at an historically rapid clip. Good intentions are finally being translated into good policies. Investors, innovators, and entrepreneurs are already responding (witness the large number of big businesses publicly backing Obama's plan). Today's developments will ensure ever more savvy firms rush to join them, be it through the direct development of clean technology or an awareness of the need to embrace energy and resource efficiency.
It is this wave of clean tech development and deployment that could yet emerge as Obama's enduring legacy. If it does so, the Clean Power Plan, imperfect and insufficiently ambitious as it remains, may yet go down in history as one of the defining turning points in mankind's efforts to tackle climate change. It really is that big a deal.
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