Institute for Energy Research


The Institute for Energy Research (IER) is a not-for-profit organization that conducts intensive research and analysis on the functions, operations, and government regulation of global energy markets. IER maintains that freely-functioning energy markets provide the most efficient and effective solutions to today’s global energy and environmental challenges and, as such, are critical to the well-being of individuals and society.

Most Recent Articles by Institute for Energy Research:

Macron’s Carbon Tax Disaster

Dec 6, 2018 — Institute for Energy Research

Most Americans are probably just hearing about the ongoing protests in France after images of rioting around the Arc de Triomphe in Paris this past weekend finally forced the topic onto the front page. The nationwide protests, now in their third week, had previously garnered little coverage outside France, and what limited mention was made often obscured the source of anger driving the protests with vague references to “rising fuel prices.” Since this weekend, international media has reluctantly gotten closer to identifying the root cause, citing “rising taxes.” But this is not just any old tax protest, it is targeted at a very specific kind of tax: namely, a carbon tax. The protests in France, which despite the focus on Paris have been overwhelmingly peaceful and span the entire country, should be considered another data point in the building backlash to the international green agenda of forcing energy prices higher.


Popular Analysis of the National Climate Assessment Misleads the Public on the Economics of Climate

Nov 30, 2018 — Institute for Energy Research

Popular Analysis of the National Climate Assessment Misleads the Public on the Economics of Climate
The Executive Branch’s recently released Volume II of the National Climate Assessment (NCA) is a massive document that is being cited as yet further evidence that the U.S. government should act quickly and boldly in the fight against climate change. The coverage in the New York Times was typical: “All told, the report says, climate change could slash up to a tenth of gross domestic product by 2100, more than double the losses of the Great Recession a decade ago.”


Canadian Crude Oil Sells at Record Discounts

Nov 9, 2018 — Institute for Energy Research

Canadian Crude Oil Sells at Record Discounts
Canadian crude oil is selling below U.S. West Texas Intermediate crude oil by a record $52.50 per barrel based on records that go back to early 2007. The huge discount is mainly due to a lack of pipeline capacity to move the oil to markets. But, also contributing are growing production from Canada’s oil sands and a reduction in demand due to U.S. refinery maintenance shutdowns.The widening price differentials are costing Canadian producers and governments upward of $40 million a day. A setback for the Canadian oil sector is a court’s overturning the Trans Mountain pipeline expansion approval.


Washington State to Vote on a Carbon Tax Again

Nov 3, 2018 — Institute for Energy Research

Washington State to Vote on a Carbon Tax Again

Washington state’s ballot in 2016 included a provision asking voters if they would approve a carbon tax, but the initiative failed with 59 percent of the voters opposing the measure. This November, the state will try again to solicit favorable votes from the state’s electorate for approval of a tax on carbon dioxide. The carbon tax plan would require fossil-fuel companies to pay $15 per ton of carbon dioxide they release into the atmosphere starting in 2020. The tax would increase by $2 annually (plus inflation) until 2035, when it would reach about $55 per ton. The goal is to reduce greenhouse gas emissions by 20 million metric tons (about 25 percent) by 2035. That would equate to reducing global emissions by 0.02 percent in 2035.


Wind Farms Could Cause Surface Warming

Oct 31, 2018 — Institute for Energy Research

Wind Farms Could Cause Surface Warming
A Harvard University study suggests that, under certain conditions and in the near term, increased wind power could mean more climate warming than would be caused by the use of fossil fuels to generate electricity. The study found that if wind power supplied all U.S. electricity demands, it would warm the surface of the continental United States by 0.24 ˚C, which could significantly exceed the reduction in U.S. warming achieved by decarbonizing the nation’s electricity sector this century—around 0.1 ˚C. The warming effect depends strongly on local weather conditions, as well as the type and placement of the wind turbines.


U.N. Attacks the Transportation Sector in the New IPCC Report on Climate Change

Oct 28, 2018 — Institute for Energy Research

Transportation Sector
A new report by the U.N.‘s Intergovernmental Panel on Climate Change (IPCC) advises that warming needs to be limited to 1.5 degrees Celsius to avoid catastrophic climate change. The report indicates that the goal is possible within the laws of chemistry and physics but doing so would require unprecedented behavioral changes and massive funding. The 1.5-degree scenario would require cutting carbon dioxide emissions by as much as 45 percent over the 20-year period from 2010 to 2030 and to a net zero by 2050, which means that all carbon dioxide released would need to be captured and stored or reused. The cost would be $2.4 trillion every year until 2035. Given that last year, the total spent on renewable energy was $333.5 billion, it appears that the $2.4 trillion number is not very doable. The IPCC report admitted as much: “These options are technically proven at various scales, but their large-scale deployment may be limited by economic, financial, human capacity and institutional constraints.”

According to the IPCC, a tax on carbon dioxide emissions would need to be as high as $27,000 per ton at the end of the century. That is equivalent to a $240 per gallon tax on gasoline in the year 2100. In 2030, the carbon tax would need to be as high as $5,500, which is equivalent to a gasoline tax of $49 per gallon. As a result, the IPCC envisages a future where people travel independently less, use forms of transportation like car sharing, and hybrid and electric cars, and use vehicles swaps and mass transit.


United Nations IPCC Climate Agenda Ignores Cost

Oct 27, 2018 — Institute for Energy Research

United Nations IPCC Climate Agenda Ignores Cost
In a previous IER post, I explained the enormous disconnect between the work of newly-anointed Nobel laureate William Nordhaus, and the United Nations’ new “special report” calling for drastic government measures to limit global warming to 1.5°C. Specifically, Nordhaus’ “DICE” model—which was chosen by the Obama Administration as a state-of-the-art pioneer in the field—showed that doing nothing at all was a better policy than what the U.N. is currently demanding.

In the present article, I’ll use the U.N. Intergovernmental Panel on Climate Change’s (IPCC’s) own published reports—which ostensibly codify the peer-reviewed literature in several fields, in order to show policymakers and the public what the “settled science” is—in order to show that the latest calls for a 1.5°C target would be ludicrously expensive. And this is why the latest IPCC report does not present the actual cost of its proposals. It simply takes the 1.5°C ceiling as a given. There is literally no attempt to use the existing body of literature to show that the benefits of the proposals outweigh their costs.


Proponent of Alberta Carbon Tax Misleads the Public

Oct 24, 2018 — Institute for Energy Research

Proponent of Alberta Carbon Tax Misleads the PublicOne of the problems with a carbon tax is that it hits poorer households particularly hard. By raising the prices of electricity, heating, and transportation—which is the whole purpose, not an unintended side effect—a carbon tax falls disproportionately on lower-income people, not in absolute dollar terms but as a proportion of their monthly budget. The advocates of a carbon tax try to fix this problem by recommending a “rebate” of its proceeds, and in some cases (such as Alberta) they even target the rebate to poorer households. They present calculations showing that poor people “make money” from a carbon tax, and so are allegedly better off.

Even if we accept these figures at face value, they don’t prove what they claim. I explained this fallacy with regard to comparable claims from the U.S.-based Climate Leadership Council (CLC). Namely, even if a particular household pays less in carbon taxes than it receives in dividend rebates, it could still be worse off, because the carbon tax makes energy (and other goods) more expensive. (That’s what taxes do, folks.) A poor household can reduce the amount it pays in carbon tax by changing its behavior, such as using less electricity and taking the bus instead of owning a car. The calculations depicting a household as a “net financial winner” from a carbon tax assess the money flows after the household adapts to the higher prices (particularly for electricity and gasoline) due to the tax.


Wind Gives Way to Solar Power and Natural Gas After Federal Subsidies End

Oct 4, 2018 — Institute for Energy Research

Wind Gives Way to Solar Power and Natural Gas After Federal Subsidies End
Wind’s federal subsidy, the production tax credit, is currently set to be phased out by 2020, at which point wind power will likely give way to solar and natural gas plant additions, which will replace retiring generating plants, mostly coal and nuclear, and satisfy slowly increasing electricity demand, according to EIA’s Annual Energy Outlook. The Energy Information Administration projects that wind additions between 2025 and 2040 will be a paltry 1.2 gigawatts, while solar power additions are expected to total 170 gigawatts and natural gas additions are expected to total 78 gigawatts. The investment tax credit for solar power phases down to a permanent 10 percent for commercial and utility investment in 2022 from 30 percent today.


California’s 100-Percent Zero-Emission Power Goal

Oct 2, 2018 — Institute for Energy Research

California's 100-Percent Zero-Emission Power Goal
California lawmakers have set a goal of relying entirely upon zero-emission energy sources for the state’s electricity by 2045. The bill requires that 50 percent of California’s electricity be supplied by renewable resources by 2025 and 60 percent by 2030, and 100 percent “zero-carbon” electricity by 2045, which can include nuclear power. Scientists, however, debate whether 100-percent zero-emission energy is feasible without cost-efficient storage technologies or new technological advances.


Big Green Carpetbagging: Environmental Foundations’ Out-of-State Spending

Oct 2, 2018 — Institute for Energy Research

Big Green Carpetbagging: Environmental Foundations' Out-of-State Spending
The fact that the shale revolution has saved Americans $74 billion per year and has made the U.S. the top oil producer in the world is, to put it mildly, a big deal. Even more important, however, is the fact that hydraulic fracturing has transformed and continues to transformed the lives of millions of underserved Americans. While people and opportunities are moving from rural America and towards the largest cities, it is primarily in the places left behind that the oil and gas industry will be creating 3.5 million jobs and contributing more than a trillion dollars in state and local taxes over the next twenty years. We have already seen miraculous revitalizations of towns in the Permian Basin of West Texas and eastern New Mexico as well as the Marcellus Formation in northern Appalachia—sparking further benefits, such as China’s $84 billion investment in West Virginia.


Australia Shows Futility of Climate Legislation

Sep 27, 2018 — Institute for Energy Research

Australia Shows Futility of Climate Legislation
An article last month in the New York Times showcases the futility of climate legislation, regardless of one’s views on the desirability of government measures to reduce greenhouse gas emissions. Specifically, Somini Sengupta’s piece explained that the Australian government was toppled because of climate policy, and then drew parallels to the United States and Canada. Whether it was her intention, Sengupta demonstrated that if indeed climate change is a problem, activists should realize that the political process offers a very unreliable “solution.”


Is the Environmental Left Really ‘David’ Fighting Goliath?

Sep 24, 2018 — Institute for Energy Research

Is the Environmental Left Really 'David' Fighting Goliath?
In the narrative crafted by environmental groups, the fossil fuel industry is depicted as a greedy, politically connected, and downright evil conspirator working to undermine the democratic will. It has been compared to the mid-century tobacco industry as a disseminator of misinformation about the harm of its products to keep people “addicted” to them. To fight this evil Goliath there has emerged a ‘David’—a scrappy, rag tag team of environmental groups and renewable energy companies, whose weapons of “truth” and science must overcome the larger might of money and power wielded by their opposition. But this self-serving narrative is false.


Coal Is Still King in the Global Generating Sector

Sep 24, 2018 — Institute for Energy Research

Coal Is Still King in the Global Generating Sector, U.S. Coal Exports
Globally, coal still generates more electricity than any other source. In 2017, coal generated 38 percent of the world’s electricity—64 percent more than natural gas, which ranked second in electricity generation worldwide. Coal’s share in 2017 was no smaller than its share two decades earlier. In that time, electricity consumption worldwide increased by 76 percent. While the global share of electricity from natural gas and from renewable energy each has grown since 1998, their generation has substituted for nuclear and petroleum generation in the world market, rather than for coal generation. Various countries have limited their nuclear generation since the tsunami hit Japan’s Fukushima Daiichi nuclear units in 2011, forcing nuclear decommissioning, and petroleum has been on the decline for a long time as a generating fuel.


Big Green, Inc.‘s assault on the coal industry

Sep 19, 2018 — Institute for Energy Research

Big Green, Inc.'s assault on the coal industry
This week, the Institute for Energy Research released Big Green, Inc., a database that details the substantial financial network supporting the environmental movement in the United States. One of the goals of Big Green, Inc. is to provide concrete examples of how environmental groups with deep-pocketed donors influence American energy and environmental policy.

There is no better example of this influence than the Environmental Left’s all-out assault on the American coal industry over the past two decades. Many people argue that the “War on Coal” has been overstated as the Clean Power Plan has yet to be implemented, and that the real cause for the decline of the American coal industry was the emergence of hydraulic fracking and its impact on natural gas prices. But that’s only one part of this story. The other, lesser-known part, is the abuse of the legal system by environmental groups to inhibit coal development at the local level.


U.K.‘s Wind Farms Idled in Summer Heat Wave

Sep 19, 2018 — Institute for Energy Research

The United Kingdom’s wind farm capacity increased by over 10 percent from last year, but the share of electricity the wind turbines supplied decreased—from 12.9 percent of generation last summer to 10.4 percent this summer because of a weather system that resulted in much of the country under a heat wave with suppressed wind conditions. Like wind capacity, the U.K.‘s solar capacity also increased—from 11.3 gigawatts in April, 2017 to 12.1 gigawatts this year.


Busting the “100 Percent Renewable” Myth

Sep 14, 2018 — Institute for Energy Research

Busting the 100 Percent Renewable Myth
Facebook and Sony are just the most recent companies to pledge the transition to running on 100 percent renewable energy. Many companies such as Apple, REI and Google claim that they get their electricity from 100 percent renewable sources already. At best, this claim is misleading and deceptive. We cannot find a single instance of a large company actually going “100 percent renewable.” The reality is that as long as these companies are connected to the electric grid, they still get the vast majority of their electricity from conventional sources such as coal, natural gas, and nuclear power, and are therefore not 100 percent renewable.


Petroteq Believes its Technology Is the Key to Utah Oil Sands

Sep 14, 2018 — Institute for Energy Research

Petroteq Believes its Technology Is the Key to Utah Oil Sands
Oil sands are a type of unconventional oil that is a mixture of sand and dense, viscous bitumen. Utah contains approximately 55 percent of U.S. oil sands deposits, concentrated in eight major areas with a total resource volume of over 30 billion barrels.

Petroteq, a Canada-based company, is leading the charge to extract this valuable commodity. The technology they use is different from other oil sands projects in that it consists of solvents that can separate oil from rocks at little cost and with no water or air pollution. It is a “closed-loop” process that perpetually reuses the proprietary solvents. The company claims the break-even price is $32 a barrel, including all costs and taxes‚Äîless than half the current price for crude oil.


The Mounting Solar Panel Waste Problem

Sep 13, 2018 — Institute for Energy Research

The Mounting Solar Panel Waste Problem
Solar photovoltaic panels, whose operating life is 20 to 30 years, lose productivity over time. The International Renewable Energy Agency estimated that there were about 250,000 metric tons of solar panel waste in the world at the end of 2016 and that the figure could reach 78 million metric tons by 2050. Solar panels contain lead, cadmium, and other toxic chemicals that cannot be removed without breaking apart the entire panel. While disposal of solar panels has taken place in regular landfills, it is not recommended because the modules can break and toxic materials can leach into the soil, causing problems with drinking water. Solar panels can be recycled but the cost of recycling is generally more than the economic value of the material recovered. Used panels are also sold to developing world countries that want to purchase them inexpensively despite their reduced ability to produce energy. Regardless, solar panel waste disposal is a problem that needs to be addressed.


Oren Cass: “There’s No Conservative Carbon Tax”

Sep 11, 2018 — Institute for Energy Research

Oren Cass: There's No Conservative Carbon Tax
On these pages over the years, I’ve consistently pointed out that the American public was being misled on the case for a carbon tax. For example, I used the UN’s own reports to show that the popular climate change goal of limiting warming to two degrees Celsius would probably be a cure worse than the disease; i.e., that the costs of government action to mitigate climate change are higher than the benefits. I’ve also spent many posts warning libertarians and conservatives to be wary of claims that a carbon tax could boost conventional economic growth, since the people making this “conservative case for a carbon tax” often misrepresented the literature and ignored obvious political realities. In this context, it was refreshing to see the Manhattan Institute’s Oren Cass recently write a post reaching these same conclusions.