[Senate Hearing 113-796]
[From the U.S. Government Publishing Office]





                                                        S. Hrg. 113-796

  LEGISLATIVE HEARING TO EXAMINE S. 2911, SUPER POLLUTANTS ACT OF 2014

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

                            DECEMBER 2, 2014

                               __________

  Printed for the use of the Committee on Environment and Public Works



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               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                    ONE HUNDRED THIRTEENTH CONGRESS
                             SECOND SESSION

                  BARBARA BOXER, California, Chairman
THOMAS R. CARPER, Delaware           DAVID VITTER, Louisiana
BENJAMIN L. CARDIN, Maryland         JAMES M. INHOFE, Oklahoma
BERNARD SANDERS, Vermont             JOHN BARRASSO, Wyoming
SHELDON WHITEHOUSE, Rhode Island     JEFF SESSIONS, Alabama
TOM UDALL, New Mexico                MIKE CRAPO, Idaho
JEFF MERKLEY, Oregon                 ROGER WICKER, Mississippi
KIRSTEN GILLIBRAND, New York         JOHN BOOZMAN, Arkansas
CORY A. BOOKER, New Jersey           DEB FISCHER, Nebraska
EDWARD J. MARKEY, Massachusetts

                Bettina Poirier, Majority Staff Director
                  Zak Baig, Republican Staff Director
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                            C O N T E N T S

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                            DECEMBER 2, 2014
                           OPENING STATEMENTS

Boxer, Hon. Barbara, U.S. Senator from the State of California...     1
Murphy, Hon. Chris, U.S. Senator from the State of Connecticut...     3
Thomas, Hon. Carper R., U.S. Senator from the State of Delaware, 
  prepared statement.............................................   103

                               WITNESSES

Zaelke, Durwood, President, Institute for Governance & 
  Sustainable Development........................................     7
    Prepared statement...........................................     9
    Responses to additional questions from Senator Boxer.........    19
Fay, Kevin, Executive Director, Alliance for Responsible 
  Atmospheric Policy.............................................    22
    Prepared statement...........................................    25
Shindell, Drew, Ph.D., Professor of Climate Sciences, Nicholas 
  School of the Environment, Duke University.....................    43
    Prepared statement...........................................    45
    Responses to additional questions from Senator Boxer.........    51
Peiser, Benny, Director, The Global Warming Policy Foundation....    56
    Prepared statement...........................................    58
    Response to an additional question from Senator Boxer........    71
    Responses to additional questions from Senator Vitter........    72
Moore, Stephen, Chief Economist, Institute for Economic Freedom 
  and Opportunity, The Heritage Foundation.......................    74
    Prepared statement...........................................    76
    Response to an additional question from Senator Boxer........    84
    Responses to additional questions from Senator Vitter........    84

                          ADDITIONAL MATERIAL

Article; The New York Times, In Step to Lower Carbon Emissions, 
  China Will Place a Limit on Coal Use in 2020...................   105


 
  LEGISLATIVE HEARING TO EXAMINE S. 2911, SUPER POLLUTANTS ACT OF 2014

                              ----------                              


                       TUESDAY, DECEMBER 2, 2014

                                       U.S. Senate,
                 Committee on Environment and Public Works,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 2:15 p.m. in room 
406, Dirksen Senate Building, Hon. Barbara Boxer (chairman of 
the committee) presiding.
    Present: Senators Boxer, Vitter, Whitehouse, Merkley, 
Boozman.
    Also present: Senator Murphy.

           OPENING STATEMENT OF HON. BARBARA BOXER, 
           U.S. SENATOR FROM THE STATE OF CALIFORNIA

    Senator Boxer. The committee is in order. I am delighted to 
call us to order, because we are looking at a bill written by 
two of my colleagues, Senator Murphy and Senator Collins, the 
Super Pollutant Act of 2014, S. 2911, which is a bipartisan 
bill that supports innovative technologies and policies to 
reduce short-lived climate pollutant emissions, otherwise known 
as SLCPs, which if you can pronounce that, OK. Because I won't 
even try.
    These emissions, we are talking about black carbon, 
methane, hydrofluorocarbons. And recent headlines have sounded 
the alarm on the mounting impacts of climate change. The reason 
I am so excited about this bill, when Senator Murphy talked to 
me about it, is it is really a bipartisan breakthrough. That is 
very important, because we are not going to get anywhere if we 
just have a partisan divide on climate.
    Over the past few months, we have seen everything, from the 
hottest August, the hottest September, the hottest October on 
record, to historic droughts and extreme wildfires, ravaging my 
home communities, to vanishing wildlife habitat in Alaska, to 
toxic algae blooming out of control and contaminating drinking 
water in Toledo, Ohio. I think it was 500,000 people had to 
drink bottled water because of this toxic algae, which is 
directly related to the heat in the water.
    Yesterday, I read a story in the New York Times, it was 
actually the lead story, and it summed up what scientists are 
now telling us. They are saying if we stay on this path, our 
grandkids will face a grim future. They actually lay it out 
even in a more stark fashion, they say our grandchildren will 
either have a planet that is unpleasant to live in or a planet 
that is not inhabitable. Those both are bad choices, but we see 
where we are heading. That is why I am so grateful, because 
maybe we can start to take congressional action here. The 
President is taking action, and bless him for doing it. I say 
that sincerely, because I know he cares so much about the 
future. He looks into his daughters' eyes and he knows that he 
in many ways has a chance to make the planet a better place. 
And he is doing it, despite all the opposition and hysteria 
about it.
    Well, this hearing will focus on some common sense steps we 
can take to address this critical threat. S. 2911, the Murphy-
Collins bill, identifies a number of practical steps by the 
private sector and policy measures on the Federal level that 
can be taken to limit pollutants that cause climate change. 
Action to limit these super pollutants can help slow climate 
change over the next several decades while also providing 
important co-benefits to public health. That is so key. When we 
cut back on climate pollution, we have co-benefits that involve 
making the air cleaner and less asthma and less heart disease 
and strokes and all those things. So it is a win-win.
    Now, black carbon is a fine particulate matter that is 
harmful to human health and the environment. If we address 
that, we can help avoid the worst impacts of climate change and 
also reduce exposure to air pollutants, again, that cause all 
these respiratory and cardiovascular ailments and premature 
deaths.
    Similarly, reducing methane leaks and emissions can prevent 
increases in ground level ozone pollution, which will reduce 
the threat to public health. We know the President has put out 
a really good policy on this ground level ozone pollution, 
which we know is smog that can worsen bronchitis, emphysema and 
asthma. I often say, and I will say it again, if any of us, as 
a Senator, visits the schools, and I know, Senator Murphy, how 
old are your boys now?
    Senator Murphy. Six and three.
    Senator Boxer. Six and three. I say the next time you go 
visit their class, the older one, ask the class, how many of 
you kids have asthma, or how many of you kids know someone with 
asthma. You will be stunned to see, well, maybe you won't be 
stunned, I was stunned when I asked that question, I was in a 
school in San Francisco with Hillary Clinton way back in the 
1990's. We asked the class, and way more than half of the class 
raised their hands. She had asked that question. And it just 
tells you the story. We have to protect our children from 
bronchitis and asthma.
    So S. 2911 has all these benefits and it also supports U.S. 
companies that are in the forefront of producing innovative 
chemical substitutes for HFCs and new technologies to control 
black carbon and methane leaks. And it is a real win-win when 
we can have our private sector stepping up to the plate, doing 
good things and doing well financially. That is the ticket 
here. And that is what S. 2911 does, because they establish an 
interagency task force to mitigate short-lived climate 
pollutants, they ensure Federal agencies have plans in place to 
reduce HFC and methane at Federal facilities. We are the 
biggest landlord in the Country. If we start doing these 
things, it has a real impact.
    It also says we should use existing Federal authorities to 
phase in these alternatives to HFCs and encourage HFC recovery 
and recycling. And also encourage substantial black carbon 
pollution reduction efforts in developing countries as part of 
the State Department's programs. It also calls for directing 
Federal agencies to assess whether the pipeline transmission 
rates and new standards for pipeline systems can reduce methane 
leaks.
    This is incredible. I once looked at this issue, how many 
people we could put to work just going after these leaks and 
have that win-win benefit. It is so good.
    And I want to welcome our witnesses, and Chris Murphy, I 
want to particularly say thank you so much. I think what you 
have done is a breakthrough. Because not only is it important 
in addressing climate, but it is a bipartisan effort.
    So would you start off, and then we will go to the rest of 
the panel.

            OPENING STATEMENT OF HON. CHRIS MURPHY, 
           U.S. SENATOR FROM THE STATE OF CONNECTICUT

    Senator Murphy. Thank you very much, Chairman Boxer. Thank 
you for calling this hearing today. Thank you for your 
encouraging words with respect to our legislation. I am pleased 
to share the panel here, at least kick it off with some very 
able experts. Thanks to Ranking Member Vitter as well for 
making this hearing possible today.
    We are here to discuss, as you very aptly described, SLPCs, 
short-lived climate pollutants. These are substances that do 
grave damage to the climate, often at a rate that is tens of 
hundreds of times the damage on a time-to-time basis that 
carbon dioxide does. But frankly, they are a lot less well-
known than carbon dioxide. The problem posed by SLPCs, they 
represent an opportunity, it is an opportunity to save lives, 
to create a lot of jobs and to protect fragile ecosystems.
    They also represent a political opportunity. I am honored 
to have this considered as a breakthrough, but phasing down 
these pollutants can be done more quickly and relatively easily 
when compared to the hard but desperately necessary work that 
we have ahead of us to slow CO2 emissions.
    As members of the committee well know, we are talking here 
about black carbon, methane, and hydrofluorocarbons, or HFCs. 
The first is a byproduct of combustion. The second is a fuel. 
The third is an industrial chemical.
    None of them are as vital to the functioning of the world's 
economy as carbon dioxide. That means that adopting sensible, 
money-saving policies to phase down emissions of all of these 
will require an effort that is relatively manageable compared 
to the scale of the other global challenges that we face.
    So that is why Senator Collins and I worked together to 
draft the legislation that is under consideration by the 
committee today, the Super Pollutants Act. If enacted, this 
legislation would expand existing programs to launch new 
initiatives needed to tackle the many ways in which SLPCs are 
emitted.
    We are not talking about revolutionary change here. We are 
just talking about some common sense steps that can bring 
Republicans and Democrats together around cleaning up our 
climate. Our bill encourages USAID and development agencies to 
consider methane and black carbon emissions when financing 
projects overseas. Our bill would urge modifications in the 
Energy Star program to recognize refrigeration systems that use 
non-HFC chemicals while still achieving energy savings. We 
would help coordinate interagency SLPC initiatives, so that 
individual departments are working in tandem when it comes to 
these pollutants.
    Both Senator Collins and I realize that considerable 
obstacles confront the enactment of this or any legislation in 
this present congressional environment. However, we believe 
this legislation represents an opportunity to have an important 
foundation for bipartisan cooperation on climate and public 
health issues. That is because one can favor reductions in 
methane, black carbon and HFCs for reasons that frankly have 
little to do with climate change. There is a huge climate 
change component to this legislation, but Senator Collins has 
been a leader in pushing for the expansion of clean-burning 
cook stoves in the developing world. Because indoor burning of 
wood and animal dung kills millions and millions of people 
every year. Installing filters diesel truck engines similarly 
reduces soot emissions, while promoting the use of American-
made technologies, an effort that Senator Inhofe has strongly 
supported for years.
    Transitioning away from HFC compounds, both here and 
abroad, promotes the use of American technologies and 
manufacturing know-how. The economic benefit to this Country is 
great. The demand for air conditioning in India alone is 
anticipated to grow by a factor of 50 by 2013. Wouldn't it be 
better if Indians were able to meet that demand by embracing 
technological solutions developed in partnership with U.S. 
firms?
    Limiting methane leaks can actually save considerable sums 
of money for companies and governments that are willing to 
recapture it and burn it themselves. Indeed, man-made methane 
emissions are expected to grow by 25 percent over the next 15 
years. In the oil and gas industry, it is a win-win for 
distributors and consumers to make sure that less product leaks 
out of wells and pipes on its way to the end users, as Senator 
Boxer said.
    Now, I say this not to belittle the climate impacts that 
reducing SLPCs could produce. Estimates show that aggressive 
action could prevent nearly a half a degree Celsius of warming 
in the atmosphere. Instead, I am making this case because 
tackling climate change needn't be as fiercely and reflexively 
partisan an issue as it has become in recent years. We can do 
immense good for the climate while doing good for our health 
and our businesses as well. SLPCs can and should represent the 
beginning of much-needed bipartisan goodwill on this topic.
    So I would like to thank both the business and non-profit 
communities who have been a part of drafting this bill, for the 
members of the committee who have already reviewed or co-
sponsored the legislation, I thank you. For those who haven't 
examined it in detail, I hope that they will and their staffs 
will do that in the coming weeks. If they think it can be 
improved, Senator Collins and I would love to work with the 
committee to do that.
    Madam Chair, I have with me a statement from Senator 
Collins. She has another hearing today, but she would love to 
have entered into the record a very strong statement of support 
for our bill.
    Senator Boxer. Without objection, so ordered.
    [The prepared statement of Senator Collins follows:]
    
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    Senator Murphy. So I look forward to testimony today. 
Again, I thank you, Chairwoman Boxer, for bringing us together 
and again express my gratitude for the attention and the time 
of the committee today.
    Senator Boxer. Thank you so much, Senator. You are free to 
stay, I know you have a crazy schedule as well.
    But I will move on, with Mr. Durwood Zaelke, President, 
Institute for Governance & Sustainable Development. Welcome, 
sir.

     STATEMENT OF DURWOOD ZAELKE, PRESIDENT, INSTITUTE FOR 
              GOVERNANCE & SUSTAINABLE DEVELOPMENT

    Mr. Zaelke. Thank you, Madam Chair, for the opportunity to 
testify today.
    Solving climate change may be hard. But getting started is 
easy. The Super Pollutants Act that we are discussing today 
gets us started solving the fast half of climate change. And it 
will help us build the on-ramp, the bipartisan on-ramp, to 
solving even more difficult parts of climate change involving 
fossil fuels and CO2 emissions.
    As Senator Murphy said, there are many reasons to support 
this bill. Climate is the first and perhaps the most important. 
But if you want to see other reasons, look to the public health 
benefits. The World Health Organization tells us that seven 
million people a year die from black carbon air pollution and 
millions more are made so sick they can't go to work, they 
can't go to school, the asthma that the Chairwoman mentioned. 
Cutting black carbon can save at least two million of these 
lives and it can make other citizens of the world healthier and 
more productive.
    There is no dispute about the health benefits of black 
carbon. You can see it, you can taste it. It kills people and 
cutting it will save lives and improve health. California has 
already done this. California has cut black carbon by 90 
percent and it has pioneered the development of the technology 
that the rest of the world needs to cut its black carbon.
    China, for example, has just mentioned that they are going 
to be putting $277 billion into cleaning up their air 
pollution. That is a tremendous market for U.S. technology. The 
rest of Asia needs the same technology, India in particular, 
but also Africa and Latin America. The whole world does. This 
is a tremendous opportunity.
    We could also look to the benefits for crop productivity. 
Methane and the photochemical smog it creates damages crops. 
When we lose crops around the world, we create conflicts that 
often our military has to go help solve. So we can bring 
tremendous benefits on that side as well.
    Finally, the Super Pollutants Act will help us reduce this 
third super pollutant, the HFCs. There are some efforts 
underway already in the U.S. and elsewhere. Europe, for 
example, has a law that goes into effect next month that will 
cut HFC emissions by 79 percent by 2030.
    At the global level, the U.S. has led the effort to use the 
Montreal Protocol to phase down HFCs. This will level the 
playing field and prevent a patchwork of regulations that our 
industries would have to face. The Montreal Protocol was first 
negotiated under President Ronald Reagan. It is widely regarded 
as the most efficient and effective international environmental 
agreement we have ever created. It has already phased out 
nearly 100 damaging chemicals by nearly 100 percent. It has 
ever country of the world as a party, developing and developed. 
And they all have mandatory obligations under this treaty. They 
all have nearly 100 percent compliance as well.
    As we phased out the prior chemicals, the CFCs under the 
Montreal Protocol and now the HCFCs, no one noticed. No one was 
inconvenienced. No one's air conditioner didn't work or 
refrigerator didn't work. In fact, they became more efficient 
and the consumer saved money. So this treaty has been 
incredible, not only in putting us back on the path to solving 
this stratospheric ozone challenge but also in helping us with 
climate. This treaty has already done five to ten times more in 
climate mitigation than the Kyoto Protocol. And it stands ready 
to do even more by phasing down the HFCs.
    Just to give you the scale, the combined effort to phase 
down the short-lived climate pollutants will avoid about .6 
degrees of warming by the mid-century. That is compared to an 
aggressive effort to cut CO2 , which will avoid 
about .1 degree, a lot less. By the end of the century, they 
begin to equalize. We have to do both, of course.
    So we are ready to do the next big piece with HFCs. And it 
will give us perhaps the single biggest and fastest piece of 
climate mitigation in the world, and it will incredibly 
inexpensive.
    If you go back to the early efforts----
    Senator Boxer. I am going to ask you to wrap up your 
statement.
    Mr. Zaelke. I will wrap up, and thank you.
    In conclusion, the Super Pollutant Act can help save 
millions of lives, improve crop yields, promote U.S. industry, 
cut near-term warming in half through the middle of the 
century. Just as important, the Act can help create the 
bipartisan momentum that we so desperately need to solve the 
rest of climate change.
    Thank you, Madam Chair.
    [The prepared statement of Mr. Zaelke follows:]
    
    
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    Senator Boxer. Thank you, Mr. Zaelke.
    I am going to just tell you what the plan is here. Senator 
Whitehouse is going to run this hearing. I have been called to 
a hearing on sexual assault on college campuses, and I need to 
run there. My hope is to run there and back, but one never 
knows. He has graciously said he is going to take this.
    Colleagues who are here, Senator Boozman, Senator 
Whitehouse, Senator Murphy was here, Senator Murphy started 
off, he gave his statement. He also put in the record a 
statement by Senator Collins and made the point this is our 
first real bipartisan breakthrough on an issue dealing with the 
climate. But as was pointed out, it is a lot more than climate, 
it is about a lot of other things as well.
    So I am going to hand this over to Senator Whitehouse and 
he will run this. I just want to thank you all so much. I am 
excited about this bill.
    Senator Whitehouse, why don't you take it from here.
    Senator Whitehouse.
    [Presiding] Very well, and Mr. Fay, we will turn to you.

   STATEMENT OF KEVIN FAY, EXECUTIVE DIRECTOR, ALLIANCE FOR 
                 RESPONSIBLE ATMOSPHERIC POLICY

    Mr. Fay. Thank you, Senator.
    I serve as Executive Director of the Alliance for 
Responsible Atmospheric Policy. We appreciate the opportunity 
to testify today.
    The Alliance, originally organized in 1980, is a coalition 
of manufacturers, businesses and trade associations which make 
or use fluorinated gases in their course of business. Today, 
Alliance member companies are leading the development of next 
generation, climate-and ozone-friendly technologies and 
applications.
    The U.S. fluorocarbon using and producing industries 
contribute more than $158 billion annually in goods and 
services to the U.S. economy, and provide employment to more 
than 700,000 individuals.
    S. 911 would help to focus government activities on the so-
called short-lived climate pollutants, including HFCs, further 
congressional understanding and identify potential future 
steps. Our comments today are specifically in relation to the 
provisions governing HFCs.
    The Alliance commended the sponsors of the legislation upon 
its introduction. We did so because the legislation would one, 
recognize the appropriate role of the Montreal Protocol in 
advancing ozone protection while reducing greenhouse gas 
emissions calibrated to the pace of technology developments and 
the availability of proven energy efficient alternatives. Two, 
acknowledges the important role of effective refrigerant 
management and recovery and re-use of refrigerant as near-term 
approaches that can achieve significant HFC emissions 
reductions. And three, close the HCFC-22 exception that permits 
the use of ozone-depleting residential air conditioning units. 
The legislation promotes both ozone protection and improved 
energy efficiency of newer systems.
    The highly successful Montreal Protocol Treaty is grounded 
in scientific understanding, includes an effective technology 
and economic assessment process and recognizes the special 
needs of developing country economies. The Protocol identifies 
long-term objectives and achieves its environmental protection 
benefits in a sensible approach, guided by economic 
feasibility.
    As a result of our experience under the Protocol over the 
last 27 years, we believe it can play an instrumental role in 
also reducing the greenhouse gas contributions of ODS 
substitutes. This approach is far preferable for uniform 
treatment of HCFs than command and control regulations by the 
United States and other nations, or the market-fracturing 
approach that will result if the major economies were all to 
choose different means of achieving HFC greenhouse gas 
reductions.
    We believe with the appropriate policy signals and flexible 
implementation, it is possible to achieve a substantial 
reduction of HFC greenhouse gas contribution over the next 
several decades. That is why in September of this year, the 
Alliance announced its intent to ``take actions and support 
policies to achieve an 80 percent reduction of global HFC 
emissions on a GWP-weighted basis by 2050.''
    The legislation acknowledges the Protocol's success and 
encourages addressing HFCs through an amendment. We would 
concur.
    The bill also encourages the utilization of Section 608 of 
the Clean Air Act as a means of reducing service emissions of 
current HFC-using equipment and promoting refrigerant recapture 
and re-use. We know that the majority of HFC emissions occur 
during the service, maintenance, repair and disposal of air 
conditioning and commercial refrigeration units. Moreover, this 
equipment operates most efficiently when properly charged and 
maintained, minimizing energy consumption and related 
greenhouse gas emissions. In reducing the contribution of HFCs 
to climate change, initiating proper refrigerant management 
practices remains the lowest-hanging fruit.
    The legislation also calls attention to the important role 
of the fluorocarbon compounds with regard to energy efficiency 
of the air conditioning units and refrigeration equipment in 
which they are utilized. Ninety-five percent of the greenhouse 
gas contribution of this equipment is derived indirectly as a 
result of its lifetime energy consumption.
    In the transitions achieved to date, and the pending 
transition to low-GWP compounds, it is imperative that this be 
part of the technology assessment process, and must include 
coordination with energy efficiency standards processes and 
appropriate modifications to building codes and standards.
    The last item highlighted in S. 2911 is language to close 
an exception for what are known as the dry-22 units. In a 
rulemaking 5 years ago, EPA defined uncharged condensing units 
to be a service component not otherwise subject to the Clean 
Air Act prohibition to place in commerce equipment that relies 
on HCFC-22, which is phased out under the protocol. As a result 
of this rule modification, the manufacture of these units 
increased significantly at a time when their phase-out was 
nearly complete. The manufacturing community has recently 
advised EPA of its unanimous position that the manufacture of 
these units should be phased out. The language in the bill 
would effect this change and the Alliance would be supportive.
    U.S. industry has been at the forefront of the technology 
advances over the last several decades on ozone protection and 
climate protection. We are now investing in the innovation of 
low-GWP compounds and technologies that will allow us to 
achieve ozone protection, climate protection and energy 
efficiency goals. We have embraced this new challenge. However, 
much work remains to be done. Technology pathways have not been 
identified for all the critical uses. Industry leaders recently 
highlighted the multi-billion dollar investments to be made 
over the next decade in order to achieve these goals. U.S. 
industry leadership and an effective global approach on the 
Montreal Protocol will be key to this achievement.
    S. 2911 is a useful legislative vehicle with regard to HFCs 
because it helps focus the attention of the relevant U.S. 
Government departments and agencies on key issues in that 
regard, including effective assessment of low-GWP alternatives 
for responsible refrigerant management and the market support 
of Montreal Protocol amendment as an appropriate path forward.
    We appreciate the opportunity to testify before you today. 
We look forward to working with you in the next Congress as 
these issues are addressed and will be happy to answer any 
questions.
    [The prepared statement of Mr. Fay follows:]
    
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    Senator Whitehouse. Thank you, Mr. Fay. I appreciate your 
testimony.
    Before we turn to Dr. Shindell, would it be possible to get 
a list of the membership of the Alliance for Responsible 
Atmospheric Policy? You have some pretty strong participants, 
and I think it would help if there was a record of that.
    Mr. Fay. Surely.
    Senator Whitehouse. Thank you.
    Dr. Shindell, if you please.

    STATEMENT OF DREW SHINDELL, PH.D., PROFESSOR OF CLIMATE 
 SCIENCES, NICHOLAS SCHOOL OF THE ENVIRONMENT, DUKE UNIVERSITY

    Mr. Shindell. Thank you for the opportunity to testify.
    We have heard that the World Health Organization has 
recently estimated that seven million die every year from poor 
air quality, making it the leading environmental cause of 
premature death worldwide. In many parts of the world, it is 
the single leading cause for women and children. It is a silent 
killer, but it is out there. In the United States it is 
responsible for over 100,000 deaths per year.
    Of all the sources of the emissions that lead to poor air 
quality in the United States, coal burning is the single 
largest, causing, by my calculations, about 47,000 premature 
deaths per year. That happens to be larger than the total 
number of Americans killed in all the years of the Vietnam War 
by hostile fire. So we hear a lot up here on Capitol Hill about 
things like the war on coal; what we forget is coal's war on 
us. There is a heavy toll, not just from coal and not just in 
terms of death from air quality. One hundred eighty thousand 
non-fatal heart attacks per year, 150,000 cases of 
hospitalization for respiratory and cardiovascular disease, all 
of these health care costs are passed on to the American 
people.
    And it is not just the American people, it is American 
business, 18 million lost work days every year due to poor air 
quality, 11 million missed school days for our children. Air 
quality is a pressing issue at the same time that climate 
change's toll continues to mount.
    The good news here is that there are solutions in many 
cases, especially when it comes to the short-lived climate 
pollutants that are the heart of this bill. In the study for 
the U.N. environment program that I led, we found that 
aggressive action to reduce methane and soot, along with the 
related emissions that come out with soot, would, as we have 
heard this morning, reduce climate change over the next, by 
mid-century or so, by about half a degree. The climate has 
already warmed by nearly a degree, and most of the nations of 
the world have pledged to reduce, to keep the warming to about 
2 degrees. So although half a degree may not sound like much, 
it is really a big deal.
    At the same time, the other benefits of targeting these 
pollutants have enormous consequences. Over the next 25 years, 
they would save about a billion tons of agricultural yield. In 
the United States alone, more than a hundred million tons of 
crop losses due to ozone pollution could be saved by phasing in 
strong reductions in methane and soot and its related 
emissions. Over a quarter million American lives could be saved 
by phasing in these same aggressive measures to reduce 
emissions of these pollutants.
    I am gratified to see that the bill that has been proposed 
and that we are discussing here today looks at many of the 
exact same measures that were included in the study that I have 
just quoted from, specifically targeting methane emissions from 
the oil and gas industry, from coal mining and from municipal 
waste, and targeting emissions of soot and related compounds 
from diesel engines, from cook stoves and from small 
industries.
    It is also particularly important to look at emissions in 
the Arctic, a particularly sensitive region of the planet to 
warming, and a place where particles can have an extra powerful 
effect on leading to a warming planet.
    Some areas in particular, as Senator Boxer mentioned this 
morning, have solutions where the finance and the industrial, 
or the economic motivation is especially strong. In particular, 
for the oil and gas sector, what is being proposed in many 
cases is simply the best practices that are already put into 
place by much of American industry being extended to the rest 
of the industry that is not yet using those and around the 
world. So sharing our technology, our industries' practices 
that already have been shown to work, taking those and 
spreading those around for the common benefit.
    At the same time, use of low-sulfur fuels allows greater 
control of particulate emissions. A recent study that we 
completed on the use of kerosene for lighting in the developing 
world shows that in many countries, for example in India, 
kerosene is heavily subsidized by the government. The financing 
required to adopt an alternative is already there and simply 
needs to be redirected. U.S. leadership can help make that come 
to pass.
    I would just like to close by pointing out that we pay a 
great deal of attention to problems and catastrophes when they 
are local and when they occur suddenly. An example, the faulty 
ignition switches in the General Motors cars. These killed 
approximately 20 people, the precise number is still a bit 
debated, over the last decade or so. At the same time, the cars 
manufactured by GM produced air pollution that killed about 
40,000 Americans. We don't pay attention to that nearly enough, 
so I am grateful to see a bill that targets this pollution that 
is leading to climate change, air quality, agricultural loss.
    I thank you for your efforts.
    [The prepared statement of Mr. Shindell follows:]
   
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    Senator Whitehouse. Thank you, Dr. Shindell.
    Our next witness is Dr. Peiser. Please proceed, sir.

STATEMENT OF BENNY PEISER, DIRECTOR, THE GLOBAL WARMING POLICY 
                           FOUNDATION

    Mr. Peiser. Thank you. First of all, I would like to thank 
the Chairman and committee for the opportunity to testify 
before your committee on, and I make that absolutely clear, on 
unilateral policies to tackle climate change, in particular 
greenhouse gases. So I am not going to talk today about real 
air pollution, but about the challenge to come to a global 
policy which is the only policy that would actually tackle 
greenhouse gases.
    My name is Benny Peiser. I am the Director of the Global 
Warming Policy Foundation, a non-partisan think tank based in 
London. And as the name suggests, our main concern are the 
policies adopted by governments. That is what I would like to 
draw your attention to, particularly the experience we are 
having in Europe with unilateral climate policies.
    The European Union has long been committed to unilateral 
efforts to tackle climate change, and in the last 20 years has 
tried very hard, felt a duty to set a kind of example through 
radical bills such as this one. We have had it, as I said, for 
many, many years, very radical climate policymaking at home. 
But it was just Europe.
    As a result, European governments have advanced the most 
expensive forms of energy at the expense of the least expensive 
forms of energy. And about 14 years ago, the EU adopted the so-
called Lisbon Strategy with a goal of making ``Europe the most 
competitive and dynamic knowledge-based economy in the world, 
capable of sustainable economic growth and more embedded jobs 
and greater social cohesion.'' In the same year, the EU also 
adopted the European Climate Change Program, which developed 
the EU implementation of the Kyoto Protocol.
    Today, 14 years after having adopted these key policies, 
the economies of most EU member states are stagnating or in 
decline. Instead of sustainable economic growth, instead of 
more jobs, instead of greater social cohesion, the OECD warned 
last week that the crisis-ridden EU has become a major threat 
to the world economy. So much for Europe becoming the most 
competitive place on earth.
    Europe's unilateral climate policies have played a crucial 
role in the EU's economic decline. And it is this experience 
with unilateral action that I want to focus upon. The other 
thing is, even though Europe has managed to reduce 
CO2 emissions domestically, this has only happened 
because it shifted essentially energy-intensive and heavy 
industries and their emissions overseas to nations where there 
are no similar emission limits, where energy and labor is cheap 
and which are now growing much faster than the EU. As a result, 
Europe's manufacturers are rapidly losing ground to 
international competition.
    The EU's unilateral climate policies pose an existential 
threat to Europe's industrial base. This threat is real, as the 
EU's outgoing industry commissioner, Antonio Tajani, has warned 
in no uncertain terms, that is the EU industry commissioner: 
``We face a systemic industrial massacre. We need a new energy 
policy. We have to stop pretending, because we can't sacrifice 
Europe's industry for climate goals that are not realistic, and 
are not being enforced worldwide.'' That is the crux of the 
problem.
    There is another problem, a problem that is hitting 
Europe's poorest most, energy poverty. In the EU, hundreds of 
billions of Euros for climate policies have been paid by 
ordinary families and small and medium sized businesses in what 
is undoubtedly one of the biggest wealth transfers from poor to 
rich in modern European history. As wealthy homeowners and 
landowners install wind turbines on land and solar panels on 
their homes and commercial buildings, low income families all 
over Europe have to foot skyrocketing electricity bills. This 
winter, millions of poor families will have to choose between 
eating and heating. And many can no longer afford to pay. So 
the utilities are cutting off their power.
    Let me conclude. Europe's climate policy has burdened 
families and businesses with astronomical costs while shifting 
its heavy industry and its CO2 emissions to other 
parts of the world. The EU's climate fail demonstrates beyond 
doubt in my view unilateral policies are a complete fiasco and 
don't really solve anything. Europe is ground zero for failed 
climate policy and here is a lesson: don't make the same 
mistake or you will suffer the same consequences. Thank you.
    [The prepared statement of Mr. Peiser follows:]
    
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    Senator Whitehouse. Thank you for your testimony, Dr. 
Peiser.
    Our final witness, Mr. Steve Moore. Please proceed.

  STATEMENT OF STEPHEN MOORE, CHIEF ECONOMIST, INSTITUTE FOR 
   ECONOMIC FREEDOM AND OPPORTUNITY, THE HERITAGE FOUNDATION

    Mr. Moore. Thank you, Senators, for the opportunity to 
testify this afternoon.
    I am the Chief Economist at the Heritage Foundation. I am 
not an environmental expert, but I am an expert on what is 
happening with the U.S. economy. I thought I would spend my 
time and devote my remarks to how the fossil fuel revolution 
that is going on in this Country has really so dramatically 
changed the economic outlook in our States. I know some of you 
represent States that are part of this oil and gas revolution 
that has played such a vital part in our economic recovery.
    Let me start by stating a simple fact that is almost 
undeniable, that the whole world of energy production changed 
almost overnight six or 7 years ago with the introduction of 
shale oil and gas and the technologies that allow us to get at 
oil and gas in the United States that has been stored there for 
hundreds of thousands of years but we never had the technology 
to get at it.
    If you look at the chart in my testimony, the first chart, 
you can see the ramifications of this for our energy production 
and also our energy imports. This has been a seismic change. 
The United States over the last 6 years has increased its oil 
and gas output by almost 50 percent in the last 6 years. That 
is something, by the way, that no one would have predicted 
possible as recently as four or 5 years ago.
    President Obama, just as recently as two or 3 years ago, 
said the United States was running out of oil and gas. I would 
amend that to say, Mr. President, with all due respect, 
American isn't running out of oil and gas, we are running into 
it big time. We have hundreds of years of supply.
    You can also see the big reduction in imports, which is a 
huge lift to the American economy.
    The second point I would like to make is maybe the most 
important, that without the shale oil and gas revolution, it is 
quite possible the United States never would have exited the 
recession. That is how important this energy revolution has 
been to the American economy.
    And if you look at the second chart in my testimony, I 
think it underscores this point. If you look at all employment, 
this goes through the end of 2013, you can see that virtually 
on net, all the new jobs created in the U.S. economy over the 
last six or 7 years have come from the oil and gas industry. We 
just 2 months ago got to the point where in all industries 
where we replaced all the jobs that were lost during the 
recession. Without the oil and gas industry, we would have been 
in a much, much worse situation and the recession would have 
lasted much, much longer.
    The third point I would like to make is that many people a 
number of years ago bet on green energy. Dr. Peiser made a 
great point on this, that European countries did go all in on 
green energy 10 or 15 years ago and it hasn't worked. What you 
are seeing is right now if you look at what is happening in 
Germany, Germany's industrial production fell the last quarter. 
This is the second quarter in a row that Germany has had net 
zero industrial growth and many of the experts believe that one 
of the reasons that German manufacturing and Germany industrial 
production has fallen so dramatically, so far behind the United 
States, is because of the fact that they are trying to use 
green energy, which is much, much more expensive. When you are 
competing in international markets and your energy prices are 
much higher, you suffer.
    By the way, I would make a side point that one of the real 
strong elements of the U.S. economy today is the U.S. economy 
is going through a manufacturing renaissance that a lot of 
people would not have predicted. It is going on in Michigan, it 
is going on in Indiana, my home State of Illinois, it is going 
on in Ohio and Pennsylvania. A lot of this industrial 
manufacturing rebound in autos and steel and other vital 
industries like plastics and chemicals is a direct result of 
the energy boom.
    The next point I would like to make is that shale gas is 
reducing U.S. greenhouse gas emissions. This is something that 
most Americans are not aware of, because the media doesn't talk 
a lot about this. But if you look over the last 10 years, the 
United States has reduced our CO2 emissions more 
than any other industrialized country that we compete with. 
This is according to the U.S. Energy Information Agency, and 
you can see in the chart that we have reduced our carbon 
emissions. The EU has reduced their emissions but not as much 
as we have. And of course, China and India are out through the 
roof in their CO2 emissions.
    The lesson here by the way is that when you shift to shale 
gas, natural gas as a form of electricity production, you 
dramatically reduce your greenhouse emissions. So the shale gas 
is a wonder fuel, because it is cheap, it is abundant, it is 
made in America and it is clean-burning.
    In my last minute or so, I would like to make this point 
about income inequality. As an economist, as you all know, this 
has become one of the No. 1 issues for Americans, is the gap 
between the rich and poor. One of the points I would like to 
stress to you all is that by making anything that makes 
electricity production more expensive, it makes it more 
expensive for people to heat their home, makes their utility 
bills more expensive, actually makes income inequality worse. 
Because the poor spend a much higher fraction of their income 
on electricity than the rich do.
    So we ought to look at this energy boom as also something 
that is reducing income inequality in the United States. By the 
way, if we adopt policies and regulations that make electricity 
more expensive, we are making the income inequality problem 
worse.
    Thank you.
    [The prepared statement of Mr. Moore follows:]
    
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    Senator Whitehouse. Thank you very much, Mr. Moore. I 
appreciate your testimony. I thank the entire panel for being 
here.
    Let me first ask Dr. Shindell, you testified that 
aggressive reductions in methane and black carbon could 
reducing warming rates over the next decade by about half. You 
are at Duke University now, which is in North Carolina, which 
has a coastline which is experiencing some sea level rise. 
Could you correlate the reduced warming rates as a result of 
reducing methane and black carbon emissions to the sea level 
rise that we are seeing in Rhode Island and you are seeing down 
in North Carolina?
    Mr. Shindell. Yes, thank you.
    Sea level rise is a cumulative process, as heat goes 
steadily into the oceans. So it is a function of how much we 
have changed climate or emitted things like carbon dioxide in 
the past as well as our future emissions. So it would be 
somewhat less than temperature, which is a bit of a faster 
response. But it would be of similar magnitude, say on the 
order of maybe 40 percent rather than 50 percent. So a very, 
very large difference.
    Senator Whitehouse. And you have been a scientist at NASA 
for the last 20 years or so?
    Mr. Shindell. Correct.
    Senator Whitehouse. You were at the Goddard Institute, a 
pretty prestigious place?
    Mr. Shindell. Yes.
    Senator Whitehouse. There is a theory that is brooding 
around Congress that the science of climate change is being 
fabricated by a global cabal of scientists who are eager to get 
their hands on research grants and get attention. You been 
watching the scientific discussion on climate change for many 
years now from a very prestigious location. As you have watched 
this debate develop, is there any truth to that theory that we 
sometimes hear here?
    Mr. Shindell. There is not only no truth to that theory, 
there is overwhelming evidence to the contrary. Not only did I 
work at a NASA institute, but NASA along with other space 
agencies around the world launches the instruments, and we 
watch the planet from satellites. We see everything all around 
the world. And the satellites don't lie. They tell you that the 
ice caps are shrinking. They tell you that the ocean is rising. 
They tell you that the temperature is going up. They tell you 
that the atmosphere is getting wetter as the air holds more 
water vapor.
    They even show that carbon dioxide is rising and they show 
that methane is increasing. All of the things we are talking 
about today.
    It has been analyzed by independent science bodies from 
almost every country in the world, almost everybody with 
credibility, with expertise in the subject matter says that 
yes, the evidence is overwhelming. The IPCC group sponsored by 
nations around the world says that the evidence is unequivocal.
    Senator Whitehouse. Not a word one usually hears in 
science.
    Mr. Moore, you founded the Free Enterprise Fund with the 
well-known economist Dr. Arthur Laffer, who was associated with 
the Reagan administration. Your bio on the Heritage Foundation 
website identifies Dr. Laffer as having a profound influence on 
your thinking. Dr. Laffer has supported a carbon fee on 
economic grounds, if, big if, it is offset with reductions and 
other taxes.
    Mr. Moore. Right.
    Senator Whitehouse. Let me quote him, what we had to say in 
support: ``I do it for pure economics. I am worried about 
economic growth in the United States and the creation of jobs, 
output and employment. If you tax people who work, you are 
going to get less people working. What the carbon tax would do 
is remove the tax from people who work and put it on a product 
in the ground. That would be very beneficial for the economy, 
pure and simple.''
    Do you agree with Dr. Laffer?
    Mr. Moore. I am familiar with the repot that you are 
talking about that Dr. Laffer put together. There is a big 
debate among conservative free market economists about whether 
a swap, where you taxed carbon and you reduce taxes on, say, 
capital or work, would be something that would be economically 
efficient. It is something I would certainly be open-minded to. 
I would have to see the details of the plan. It is certainly 
true, when you tax something, you want to tax bad things and 
you want to lower taxes on good things. So work and effort and 
capital investment are good things, and pollution is obviously 
a bad thing. So if a deal were well constructed, it might be 
something there might be bipartisan agreement on.
    Senator Whitehouse. You said in your testimony shale gas is 
reducing greenhouse gas emissions. Why is that a good thing?
    Mr. Moore. Why is it?
    Senator Whitehouse. Yes.
    Mr. Moore. Well, because carbon emissions, as a goal we 
want to reduce carbon emissions. I am not an expert on global 
warming. But other experts here know far more than I do about 
that.
    Senator Whitehouse. And you don't dispute them? You believe 
that reducing greenhouse gas emissions is a worthy goal?
    Mr. Moore. Reducing carbon emissions?
    Senator Whitehouse. Greenhouse gas emissions was the phrase 
you used. So I am using your own words.
    Mr. Moore. I think it probably should be a goal, and my 
point, when you asked me why is it that we are reducing our 
carbon emissions due to natural gas is because we are 
converting, as you know, Senator, we are converting electricity 
production in the United States away from coal and far more 
toward natural gas. I think next year will be the first year we 
produce actually more electricity from natural gas than from 
coal. That has been a positive development.
    Senator Whitehouse. The microphone now goes to the 
distinguished Ranking Member, Senator Vitter of Louisiana.
    Senator Vitter. Thank you, and thanks to all of our 
witnesses. I am sorry I was late. I was on the floor to 
actually help pass something into law, which doesn't happen 
every day. I came here as soon as I could, and thank you for 
all of your testimony.
    I will start with Dr. Peiser. Thank you, Dr. Peiser, 
particularly for traveling so far to be with us.
    You brought up with me and my staff the serious concern of 
the cycle of subsidies that seems to occur once renewable 
energy mandates are initiated. How has subsidizing renewable 
energy led to subsidizing other energy sources and industries 
in Europe? Why does this seem to occur as a direct and natural 
consequence of these climate regulations?
    Mr. Peiser. The problem, a lot of unintended consequences 
of well-intended policies occurred mainly because most 
policymakers were told that the science is settled and 
therefore the policies are settled. That is, I think, the 
biggest problem in Europe, that with the kind of hammer of the 
science, very poorly thought-through policies were adopted. 
Regardless of the science, the policies make no sense. And even 
a carbon tax, if I may say so, would not make any sense if it 
is just adopted by the U.S. Because it has exactly the same 
effect, that it would drive energy-intensive industries to 
locations where there is no carbon tax. So a carbon tax would 
only make sense if it were adopted universally so that there is 
a level playing field.
    In Europe, what has happened is because there is now a 
situation where there is a lot of renewable energy which is 
expensive because of the subsidies. But what it is happening, 
and that is a risk that the U.S. faces even with cheap shale 
gas, is that conventional power plants are no longer running 
efficiently. They are only used, or many of them used for 
backup or only 70 percent. They run uneconomically, they are 
loss-making.
    So what is happening in Europe, the governments in Europe 
are now subsidizing conventional, have to subsidize 
conventional power plants to keep them open, to keep the lights 
on. Now that we have subsidized renewable and we have 
subsidized conventional power plants, the energy price 
obviously goes up dramatically, has doubled in the last 10 
years by and large. And the industry comes and says, we can't 
survive with these energy prices, so they are subsidized as 
well.
    That is the sad, sad situation based on well-intentioned 
policies, policies that have caused a lot of damage, not just 
to industry but also to a lot of families.
    Senator Vitter. OK. And can you also discuss exactly how 
the opt-out provisions of the new EU deal on climate works, and 
if you believe member states are beginning to recognize the 
economic challenges they face in looking for basically a way 
out, at least in the face of China and India not having 
anything similar or rigorous?
    Mr. Peiser. We have for the first time that I can remember 
a European leadership that seems to be more skeptical about 
these policies than the U.S. Administration. I can't recall any 
time that that has ever happened, because Europe always adopted 
much more aggressive and much more green policies. Here, the EU 
leaders have made their targets for 2030 conditional on a 
legally binding U.N. agreement in Paris. And they have agreed 
that unless there is this agreement that is binding, and I 
understand there are now big problems even as we speak in Lima 
about this very issue, the Europeans will revisit their 
targets.
    So the targets are conditional on a binding agreement, 
whereas the U.S. Administration seems to be quite happy to go 
it alone.
    Senator Vitter. OK. And Mr. Moore sort of related to that 
in terms of unilateral versus something else. Could you comment 
on President Obama's recent deal with China and what did China 
get out of the United States in the deal?
    Mr. Moore. I am deeply skeptical that China will ever meet 
these targets that were allegedly agreed to. Actually, if you 
read the statement by the Chinese president, it says we intend 
to do this, which is hardly an iron-clad agreement. If you look 
at that chart, Senator, it is that chart on the third or so 
page of my testimony, you can see that the last 10 years, while 
we have reduced our carbon emissions by about 6 percent, China 
has increased theirs by 156 percent. That doesn't sound like a 
country that is getting very serious about reducing their 
carbon emissions.
    We do know that China is building substantial numbers of 
new coal-burning power plants. They are buying a lot of coal 
from the United States. They also, as I am sure you read, they 
have a new agreement with Russia where they are going to spend 
several hundred billion dollars on pipelines to pipeline oil 
and gas from Russia into China. As I said in my testimony, that 
doesn't sound like the actions of a country that intends to 
substantially reduce its fossil fuels production.
    Senator Vitter. And in fact, beyond that, couldn't an 
argument be made that they almost have an incentive to increase 
their peak several years out, because reductions are measured 
from a peak?
    Mr. Moore. Look, if their economy continues to grow at the 
rate that it has, what has happened in China over the last 25 
years, one of the great economic miracles of human history, 
where they have been growing at a 12 to 13 percent compounded 
rate. Not many economists think they can keep that up. But even 
if their growth rate falls in half, they are still growing at 6 
to 7 percent.
    They are going to consume a whole lot, they are going to 
need coal, they are going to need oil, they are going to need 
gas, they are going to need nuclear power. And they may also 
use green energy as well if it can be done and produced in a 
way that is cost-efficient. I think the point that Dr. Peiser 
and I are making is that right now it is not cost-efficient. It 
is substantially higher in cost to generate electricity from 
wind and solar than it is from coal, natural gas and nuclear 
power.
    Senator Vitter. OK, thank you.
    Senator Whitehouse. Senator Merkley and then Senator 
Boozman.
    Senator Merkley. Thank you.
    Dr. Moore, you are familiar as an economist with the 
concept of externalities. In Oregon right now we are seeing a 
fire season that has grown by about 60 days over a couple of 
decades. We are seeing greater pine beetle damage to our 
forests. We are seeing problems with the reproduction of 
seafood, particularly oysters, because of the 30 percent more 
acidic ocean water. And we have a great drop in the snow pack 
in the Cascades, which is leading to significant water 
shortages in the Klamath Basin.
    These are externalities that it didn't sound to me like you 
have calculated into your analysis. Why is that?
    Mr. Moore. You are right, there are externalities with any 
form of energy production, no question about it. So the 
tremendous amount of water that is used by modern drilling 
techniques is certainly a cost. As I said, there are costs to 
nuclear power in terms of the risk of accidents, there are 
costs from oil in terms of oil spills. Obviously wind and solar 
have external costs as well. We have to kind of balance in the 
cost and the benefits.
    You are quite right, taking in those costs may reduce some 
of the benefit that I documented by some degree, but not 
substantially in my opinion. Because we are talking about 
costs, for example, of energy production from coal and natural 
gas that is very substantially lower than the cost of 
producing, say, from windmills or solar paneling.
    Senator Merkley. I would certainly encourage you to 
actually look at these externalities seriously. For example, 
the impact on coral reefs around the world from the greater 
acidity and the warmer oceans is having a big impact on 
fisheries around the world. Just these examples, they are 
multitudinous. And when you add up the costs, it suggests that 
maybe the calculation is that the costs do exceed the benefit. 
These are not captured in the price of carbon burning.
    I wanted to turn to Dr. Shindell. I read recently, and you 
mentioned space-based analysis of what is going on on the 
earth. I believe that I read about satellite data that was 
related to tracking methane concentrations. I think it referred 
to a methane bubble in areas where fracking has occurred. There 
is enough fugitive methane from fracking that it has started to 
become detectable. Are you familiar with that particular part 
of the problem?
    Mr. Shindell. Yes, thank you. What we heard before was that 
natural gas has a lower greenhouse gas emission than coal. In 
fact, what is really the case is natural gas has lower carbon 
dioxide emissions than coal. But methane is a much more 
powerful greenhouse gas, and hence the focus of part of this 
bill. Indeed, it only takes a few percent methane leakage to 
more than offset any benefits that you get from carbon dioxide. 
So industry tends to report, and in many cases it seems 
accurate, that their leak rates are extremely low from oil and 
gas operations, often less than 1 percent.
    However, when you measure from aircraft flying overhead, or 
look down from satellites, often you see far larger methane 
amounts that are very inconsistent with those estimates derived 
from industry. They imply several percent.
    In fact, you even see places like some towns in Wyoming 
that have severe ozone levels, greater than, say, New York or 
Los Angeles, even though there is not a lot of industry, there 
are not a lot of vehicles. So it is clearly all the pollution 
coming from the oil and gas extraction operations in the 
vicinity.
    So that is the beauty of having these space-based 
observations. Researchers are not allowed to go in except where 
industry permits them to take measurements at the wellhead, at 
the gas facility. But from the air, you can really see that 
there are at least, in many cases, or at least in some cases, 
there are extremely high levels, which means that natural gas 
is actually contributing more to climate change than coal.
    But again, we have the technology to clean it up. So if we 
use best practices that are in place in some places, if we use 
those elsewhere, we could really make a big difference.
    Senator Merkley. Thank you.
    Mr. Fay, by various analyses, there is a translation of, if 
you will, gigatons of carbon dioxide that translates into 
certain parts per mission, about eight gigatons, translates 
into one part per million in the atmosphere. And by some 
calculations, to have a 50 percent probability of staying 
within the 2 degrees Centigrade, we can only burn about 500 to 
600 gigatons, or create that much carbon dioxide by burning 
fossil carbon.
    If you look at it that way, and on our current trend, we 
would expend that entire carbon budget within 16 to 20 years. 
Is that a reasonable way of looking at this particular issue?
    Mr. Fay. I am not the carbon guy, but I guess I would have 
to say that from the industry perspective, we have tried to 
look at this at longer than a 16 to 20 year timeframe. Because 
some of these are very long-term issues to resolve. The 
Montreal Protocol that we have dealt with in the ozone-
depleting compounds is now almost 30 years old. And we have 
identified paths forward for reducing the HFCs that are 
substitutes that are out there and growing rapidly between now 
and 2050. It can be done in a cost-effective way, it can 
increase energy efficiency which can help reduce carbon dioxide 
output as well.
    But I think it is important to take a long-term view in 
terms of what is achievable and identify goals and objectives 
that you can reach. I think that is what the industries that 
are involved in the HFC side have done and have proposed.
    Senator Merkley. Mr. Fay, thank you very much.
    Senator Whitehouse. Senator Boozman.
    Senator Boozman. Thank you, Mr. Chairman.
    Mr. Moore, you mentioned the problem of income inequality 
being made worse by high electricity prices impacting single 
moms, people on fixed incomes. Can you talk a little bit about 
heavy manufacturing, what that would do to jobs? It sounded 
like in Mr. Peiser's testimony that in Europe, you have a 
situation where they are moving jobs offshore to beat the 
standards that are on them. Here, it looks to me like you have 
a possibility of meeting the standards, but also in this global 
economy making it such that without that on you, then your cost 
point would make it such that you could be competitive.
    Can you talk a little bit about that? And the other thing, 
too, is you have a dirtier world than ever because they are 
moving them to places where they are not going to do what we 
do, and we can be proud of our reductions, and we need to 
continue our reductions. But they are not going to do what we 
do, and what Europe has done.
    Mr. Moore. So let me answer the first part of our question, 
which is about this issue of inequality. The big story of the 
U.S. economy over the last six to 8 weeks, of course, has been 
the massive and dramatic reduction in gasoline prices. We know 
why that is happening, gasoline prices are falling primarily 
because the United States output has increased so 
significantly.
    Now, I just did the calculations on this, Senator. Every 
time the gasoline price at the pump falls by one penny, by one 
penny, that is a $1 billion tax cut for the American consumer. 
So that means that low income people who don't have to spend 
$70 to fill up their tank, but are only spending say, $50, 
because we had a 40 percent reduction in the gasoline price, 
that means they could spend it on other things. I think 
Christmas sales are going to be high as a result of these 
reductions in gas prices.
    So this is a big stimulus to the economy. My point was, the 
people who benefit the most are people at the bottom, because 
they are paying three to four times the percentage of their 
income on electric utilities than a wealthy person.
    Now, the other point that is related to this, which I find 
interesting, you here in the Senate debate oftentimes the Low 
Income Heating and Energy Assistance Program, that is a big 
program of importance in the State of Rhode Island. There have 
been some calculations, I can get you the studies on this, that 
show that the reduction in the natural gas price, because of 
fracking and horizontal drilling, that reduction in the price 
in terms of utilities, that has benefited poor, low income 
Americans, the bottom fifth, to three times as much as the Low 
Income Heating and Energy Assistance Program.
    So think of this gas boom as three times more important for 
low income people than LIHEAP. So that is a big benefit to the 
poor.
    I think Dr. Peiser could probably answer the second part of 
your question better than I can.
    Senator Boozman. About heavy manufacturing moving overseas 
and how that affects jobs.
    Mr. Peiser. Well, we all know what happened to the textile 
industry in Europe. It doesn't exist anymore, because it went 
to cheap labor countries. And there was a big piece in the 
Financial Times last week saying, cheap energy is the new cheap 
labor. Manufacturing that requires a lot of energy moves to 
countries where energy is cheap. That is happening now. The 
European policymakers are desperate, not because of energy 
poverty and inequality, they never care about that, but that 
the industry now is moving away and that European companies, 
instead of investing in Europe, are investing in North America 
because of cheap energy. That drives them crazy.
    And the other thing is that in Germany, heavy industry is 
subsidized to the tune of $3 billion Euros per year. So they 
are essentially exempt from the energy price that the ordinary 
families have to pay.
    So ordinary families and small businesses are hit twice 
over. First they have to pay for the extremely high energy 
price and then they have to pay for the subsidies for the 
industry, just to stay there.
    As I said in my testimony and I have explained it in more 
detail, if you ever wanted to develop a policy that is most 
damaging to your country and to your industry, you couldn't 
make a better policy than the one Europeans have adopted. It is 
as dramatic as that. And for the first time, European leaders 
are willing to speak out. This was a taboo issue in Europe. It 
is not like in the U.S. I understand in the U.S. it is a very 
partisan issue, very, very heavily debated. In Europe, it was 
whole party, complete consensus and no one dared ask awkward 
questions. This has changed. People are beginning to ask these 
questions, why did we do that and why did no one else follow 
us.
    Senator Boozman. Thank you, Mr. Chairman. I don't think 
anybody on this panel minds asking awkward questions.
    Senator Whitehouse. Thank you, Senator Boozman.
    I appreciate very much the testimony of the witnesses. I 
would ask unanimous consent that my opening statement be made a 
part of the record, which it was not, because I was not here at 
the beginning.
    [The prepared statement of Senator Whitehouse follows:]

           Statement of Hon Sheldon Whitehouse, U.S. Senator 
                     from the State of Rhode Island

    Good afternoon. Thank you Chairman Boxer and Ranking Member 
Vitter for holding this important hearing, and to Senator 
Murphy [and Senator Collins if she attends] for joining us 
today and working across the aisle on the Super Pollutants Act. 
I am pleased to be an original co-sponsor of the bill and hope 
to see more practical and bipartisan legislation to protect the 
environment and manage the ever-worsening problem of climate 
change.
    Climate change is a clear and present danger for the 
American public and the world. Measurements of the atmosphere 
and oceans reveal dramatic, even unprecedented, changes in the 
climate. According to the National Oceanic and Atmospheric 
Administration, the first 10 months of 2014 have been the 
hottest since record keeping began, and 2014 is on track to be 
the hottest year on record. We're already seeing that unchecked 
emissions of greenhouse gases are pushing the climate into new, 
costly, and potentially dangerous territory.
    While we cannot ignore the dominating effect of carbon 
pollution on the climate, super pollutants like HFCs, black 
carbon, and methane also contribute to the problem. These super 
pollutants trap much more heat, ton-for-ton, than carbon 
dioxide.
    Let's consider methane. The latest scientific findings show 
that the warming potential of methane is 28 times that of 
carbon pollution when measured over 100 years and 84 times 
greater over 20 years. Methane is also the second most abundant 
greenhouse gas emitted by human activities after carbon 
pollution, and the bulk of U.S. emissions--about 30 percent--
are from oil and natural gas production.
    Methane that's leaked, vented and flared from oil and gas 
systems pollutes the environment and wastes a finite resource. 
Methane is, after all, the principal component of natural gas. 
Oil and gas producers who fail to prevent emissions of methane 
are wasting energy and losing potential profits. According to 
Ceres, in 2012 alone, North Dakota oil and gas producers flared 
more than $1billion worth of natural gas in the Bakken. 
Addressing methane emissions from oil and gas production and 
distribution will provide significant economic and 
environmental benefits.
    Some super pollutants are also linked to diminished air 
quality and threaten public health. For example, the list of 
health effects from black carbon exposure includes asthma, 
bronchitis, lung cancer, and premature death. In my home State 
of Rhode Island, the number of children and adults that suffer 
from asthma are both higher than the national average. We also 
have one of the highest rates for lung cancer in the Northeast. 
Lost school and work days, as well as the costs of inhalers and 
emergency room visits, add up. Reducing black carbon emissions 
has traditionally enjoyed bipartisan support in this committee 
and I believe this bill provides us another opportunity to work 
together in a bipartisan manner to address this public health 
threat.
    Until there is an economy-wide price on carbon pollution, 
methane, and other greenhouse gases, we need to use all the 
tools at our disposal to deal with climate change. This bill 
aims to do just that. By supporting common-sense measures to 
reduce the emissions of these powerful greenhouse gases, it can 
help us reduce the threat of climate change and improve 
environmental quality.
    Thank you Chairman Boxer and Ranking Member Vitter for 
holding this hearing, and to our distinguished panel of experts 
for joining us today to help us understand to the risks of 
super pollutant emissions as well as how we stand to benefit 
from reducing them.

    Senator Vitter. Mr. Chairman, if I could follow you with 
the same unanimous consent, request for my opening statement.
    Senator Whitehouse. Absolutely. That will be done.
    Senator Whitehouse. And there is a Politifact that was done 
with respect to the minority leader's statement that the U.S.-
China climate deal means China won't have to do anything for 16 
years. And the conclusion of Politifact was that that was a 
mostly false statement. I ask unanimous consent that the 
relevant Politifact be made a part of the record as well. 
Without objection.
    [The referenced information follows:]
    
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    Senator Whitehouse. Anything further to be made a part of 
the record?
    The record of the hearing will remain open for an 
additional 2 weeks for anything else that anybody cares to add. 
I know Mr. Fay is going to be sending us the list of his 
membership. I appreciate very much the association's testimony 
in support. I know a lot of work went into this.
    This was a potentially kind of an interesting breakthrough 
moment, to have a bipartisan bill that actually addresses 
climate change. So I will close by remarking on that. I think 
that is a good sign that the wall that has divided us is 
starting to come down in a few ways, the reality of climate 
change is being acknowledged, the forcing role of greenhouse 
gases is being acknowledged and now we are debating solutions, 
which I think is a much healthier conversation than having 
parallel realities.
    With that, we will be adjourned.
    [Whereupon, at 3:29 p.m., the hearing was adjourned.]
    [Additional material submitted for the record follows.]

           Statement of Hon. Thomas R. Carper, U.S. Senator 
                       from the State of Delaware

    I would like to thank the Chairman for holding this hearing 
and thank Senators Murphy and Collins for their legislation 
that addresses so called short-lived climate pollutants.
    I've been working across the aisle for years to address 
many of these pollutants and welcome this legislation.
    Pollutants such as HFCs and black carbon are called short-
lived climate pollutants because they don't stay in the air for 
a long time. But despite their short time in the air, we know 
they do great damage to our health and to our climate.
    That is why reducing these harmful pollutants are a win-
win-win. We lessen the threats posed by climate change; we 
improve public health; AND we create economic opportunities in 
this country.
    And though short-lived climate pollutants isn't the easiest 
thing to say, some of these pollutants are the easiest and most 
cost effective climate pollutants to clean up.
    For example, the No. 1 source of black carbon in the United 
States is old, dirty diesel engines. We can retrofit or replace 
these old, diesel engines with new, American-made technology 
and reduce black carbon emissions by more than 90 percent.
    Without assessing climate benefits, our diesel retrofit 
programs authorized through the Diesel Emissions Reduction Act 
are some of the most cost-effective clean air programs we have 
today. In fact, DERA provides more than $13 in health and 
economic benefits for every Federal dollar spent.
    I've been proud to work with former Senator Voinovich and 
Senator Inhofe on reducing black carbon pollution from our 
diesel engines.
    This bill takes another approach to addressing black carbon 
and I look forward to hearing more.
    Before I finish, I would be remiss not to mention the 
benefits of reducing the short-lived climate pollutant called 
hydrofluorocarbons--or HFCs. I am pleased to see language in 
this bill that addresses these pollutants.
    As many of you remember, in the 1970's and 80's we faced 
another global environmental crisis--there was a hole in the 
ozone and it was growing at an alarming rate. Most scientists 
believed many of the compounds used globally in refrigerants, 
aerosols and solvents were to blame.
    As a result, the global community came together to phaseout 
ozone depleting compounds --known as the Montreal Protocol. 
Since the ratification of the Montreal Protocol, we have seen a 
97 percent reduction in the global consumption of controlled 
ozone depleting substances.
    Because HFCs are easy to use, efficient, and safe for the 
ozone many countries, including ours, transitioned ozone-
depleting substances to HFCs. Unfortunately, HFCs have a high 
global warming potential.
    If HFCs usage continues unchecked, HFCs could account for 
approximately 20 percent of greenhouse gas pollution by 2050. 
So by using HFCs, we are address one global environmental 
problem, while contributing to another.
    Luckily, companies in this country are already producing 
replacements for HFCs that can be used just as safely without 
damaging our climate.
    Since 2007, I've worked with my colleagues, stakeholders 
and the EPA to find a glide path to reduce the usage of HFCs in 
this country. Although we haven't passed legislation, I am 
heartened to see the Administration work with industry and the 
international community to reduce HFCs here at home and 
globally.
    In closing, I believe the Murphy-Collins legislation is an 
important next step to building on the work we've done here at 
home--through programs like DERA--and globally to reduce short-
term climate pollutants

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