On the Issues: Value of a Bear, Carbon Markets, and More

Matt Fleck, Mary Glavey, and Elizabeth Wason

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Twice a month, we’re compiling the most relevant news stories from diverse sources online, connecting the latest environmental and energy economics research to global current events, real-time public discourse, and policy decisions. Keep reading, and feel free to send us your feedback.

Here are some questions we’re asking and addressing with our research chops this week:

How much is a bear worth?

The National Park Service and the US Fish and Wildlife Service will coordinate the transfer of several grizzlies to North Cascades National Park each year for the next 5–10 years. Grizzlies, also known as brown bears, are native to the North Cascades area but started getting killed by settlers in the 1800s, and none have been spotted in the US section of the North Cascades mountain range (which crosses the US–Canada border) since 1996. Brown bears in Katmai National Park also have received heightened attention in recent years, thanks in part to the popular “Fat Bear Week” tournament held every October. Lynne Lewis, a professor at Bates College, joined the Resources Radio podcast this week to discuss the amount of money people would be willing to pay to protect these bears. “We estimated a preservation value of $70–$140 per person per year, or a minimum of $260,000 annually for the preservation of one individual brown bear,” says Lewis.

How are carbon markets evolving in the United States and around the world?

Last week, the Biden administration published nonbinding guidelines for carbon offsets that are sold in voluntary carbon markets. Firms can purchase carbon offsets to fund third parties that reduce greenhouse gas emissions on behalf of the firms (e.g., by planting trees, which sequester carbon). The new guidance aims to improve the integrity of carbon offsets, which have come under scrutiny for reducing less emissions than promised. The past year also saw developments in another type of market-based policy that aims to reduce greenhouse gases: emissions trading systems. These policies allot emissions permits to polluters, which can then trade the permits in a market. Stefano De Clara, head of secretariat at the International Carbon Action Partnership, joined a recent episode of the Resources Radio podcast to discuss these developments in countries around the world. “We are seeing an increasing amount of new ideas and new system designs [for emissions trading systems] that are emerging right now,” says De Clara.

What types of tax credits are available through the Inflation Reduction Act for generating clean electricity, and how could these credits change in the future?

The US Department of the Treasury has proposed new guidance for two long-standing tax credits for clean energy projects: an investment credit that reduces the up-front cost of new projects, and a production credit that effectively pays firms to generate clean electricity. While solar and wind projects have been the primary beneficiaries of these tax credits to date, the Treasury Department is set to expand the list of eligible technologies beginning in 2025. Given that clean energy projects must choose between the two tax credits, distinguishing the effects of both is important, says Jay Bartlett, a senior advisor at RFF and a member of the RFF Board of Directors. Bartlett discusses the choice between these tax credits for solar and wind energy projects in the May issue of Resources magazine. “The ability to choose between the [tax credits] will have considerable effects on clean energy deployment, investment supply, and subsidy efficiency,” says Bartlett.

Expert Perspectives

In Focus: Equity in US Agricultural Policy

In May, the Committee on Agriculture in the US House of Representatives amended and approved a draft of a new Farm Bill, which now can be sent to the House floor for a vote. New versions of the Farm Bill, a massive package of policies that affect the US agricultural sector and food systems, usually are passed every five years. Among their many provisions, prior versions of the bill have tended not to provide equitable support to farmers and ranchers of color. Suzanne Russo, a fellow at RFF and director of RFF’s Environmental Justice Initiative, discusses opportunities in the new Farm Bill to reduce inequities and support a transition to a climate-friendlier agricultural system.

US Department of Energy Takes Next Step in Program to Pay for Carbon Dioxide Removal

The US Department of Energy has selected 24 companies that specialize in removing carbon dioxide from the atmosphere as semifinalists in a federal competition that aims to stimulate demand for carbon dioxide removal (CDR). Each semifinalist will receive $50,000 to help scale up the technology with which they propose to remove carbon dioxide. The agency eventually will select 10 winners and will pay those companies for credits that represent a specified amount of carbon dioxide removed from the atmosphere.

“This competition is a good start for improving CDR technologies, which is a critical step toward CDR meaningfully contributing to US climate goals,” says RFF Senior Fellow Michael A. Toman. “But more financing is needed to support initial investments in facilities for CDR at a commercial scale. Public financing is especially important to support that scale of investment, because CDR technologies are nascent and expensive. Public financing can assure early investors that demand for CDR credits will exist, which can help improve these technologies and whittle down costs.”

Resources Roundup

Improving Electricity Affordability in the Energy Transition

Many US households are struggling to afford their electricity bills, and utility companies are making significant investments in emissions reductions, which may end up increasing electricity rates for consumers in the short term. On June 26, experts will join RFF’s event series on environmental justice to explore the steps that regulators, legislators, utilities, and nonprofits can take to address electricity affordability. RFF’s Director of Government Affairs Brad Harris, who recently published a blog post on improving electricity affordability, will moderate the panel. RSVP here to attend the event.

Critical Mineral Resources and Effective Engagement with Local Communities

As demand for electric vehicles grows, the need to invest in the critical minerals that are essential to producing the batteries that power those vehicles also has increased. This week, experts joined RFF to discuss the impacts of critical mineral extraction on local communities as part of an event series on environmental justice. “There is no one size fits all approach to community engagement,” said Jason Prno, a panel participant who runs a consulting service focused on sustainable development. “We have to make sure that engagement is being tailored to local regions and communities.” Emerging scholars whose work focuses on critical minerals can apply to join a new Critical Minerals Research Lab, a virtual hub that will help PhD students develop, inform, and improve research on critical minerals that is relevant to policy. Applications will be accepted soon from PhD students who want to join the inaugural group of scholars. Sign up here so you can be the first to get information about how to apply to the Critical Minerals Research Lab.

Increasing Solar Energy Generation in Chile Reduces Air Pollution and Respiratory Illness

Producing renewable energy can result in health benefits, such as improved air quality. In a new journal article, RFF Fellow Beia Spiller and coauthors find that rapid adoption of solar energy in northern Chile has yielded health benefits by replacing electricity generation from coal-fired power plants and reducing air pollution from these plants, which in turn reduces visits to nearby hospitals that are prompted by respiratory illness. “Our results help quantify the health benefits that can be achieved through greater renewable energy investments,” say Spiller and her coauthors.

Evolving US Public Opinion on Climate and Energy Issues

American public opinion on climate and energy policies has continued to evolve as the effects of climate change have intensified. The Climate Insights survey, the product of a partnership between RFF and Stanford University, examines American public opinion on issues related to climate change. Results from the 2024 survey, set to be released this summer, will offer insights into American attitudes toward climate change in the backdrop of a politically contested election. “If we want to emphasize differences among parties, we can. But on this particular issue, there’s more agreement than disagreement,” said Jon Krosnick, a university fellow at RFF and a coauthor of the Climate Insights survey, at a recent energy conference hosted by Politico.

#ChartOfTheWeek

Chart: Carbon Brief. Data: Ember.

Greenhouse gas emissions from the power sector across nations in the European Union fell by more than 20 percent between 2019 and 2023, according to Ember, an energy research group. Progress in Portugal was especially notable: the nation reduced power-sector emissions by over 50 percent, and renewable energy met national electricity demand there for six days in a row in November 2023. Malta, Croatia, and Lithuania were the only EU nations that saw an increase in power-sector emissions; however, these nations collectively generated less than 1 percent of all electricity in the European Union in 2023.

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