Energy, tourism will be affected by climate change, report says

CASPER — Climate change will most directly affect Wyoming’s tourism and outdoor recreation industries — the state’s second largest source of revenue — according to a major government report.

But perhaps the most vulnerable industry to rising global temperatures, one that is threaded through the state’s entire economy, is energy.

The report, which was released Friday, predicts billions in losses to the U.S. economy from unbridled climate change. President Trump told reporters he doesn’t believe its findings. But Wyoming’s congressional delegation offered a more pragmatic response, citing the need for technology that would mitigate the impact on fossil fuels.

The Fourth National Climate Assessment, required every four years by Congress and compiled by 13 federal agencies, laid out heavy economic costs from coast to coast without some kind of change.

Influential oil and gas companies have acknowledged the need. Coal firms like Gillette-based Cloud Peak Energy have acknowledged the challenge. But in a state where energy is key to comfort, jobs, good roads and good schools, the question is: How ready is Wyoming?

“Wyoming will definitely change,” said Jason Shogren, Stroock Chair of Natural Resource Conservation and Management at the University of Wyoming. Shogren worked for the Intergovernmental Panel on Climate Change from 2000 to 2002. “The question is, will we be able to make this transition and will the state leaders and politicians and everybody on board be able to understand that this is a reality here that we have to deal with?”

No good news.

The Fourth National Climate Assessment is not a sunny read. It details painful economic losses across all regions of the United States if policies are not put in place to hamper greenhouse gas emission on a global scale.

The planet is warming as a result of human activities, including burning fossil fuels. While the planet cycles through warm periods and cold periods, the current trajectory would be a very slow decent into another ice age had it not been for the industrial revolution, according to the report.

Instead, the planet is warming up, and quickly.

“Earth’s climate is now changing faster than at any point in the history of modern civilization, primarily as a result of human activities,” the report states. The purpose of the report isn’t to explain climate change but to do, for the fourth time, a cost benefit analysis. It’s an economist’s take on climate change and the results are stark.

The current trend of climate change would likely undermine energy efficiency, spike electricity costs, fracture outdoor tourism-based economies, damage critical infrastructure, reduce water resources, unsettle agriculture-based regions and harm international trade, among other risks.

There are some “near-term improvements” for a warmer globe, according to the report. But they are undermined by current predictions that warming will only increase and leave a “substantial net damage to the U.S. economy throughout this century, especially in the absence of increased adaptation efforts.”

The assessment, which was released on Black Friday, is not the first look at the economic impacts. Transition away from fossil fuels was talked about in the George W. Bush administration and Bill Clinton’s eight years before that.

This isn’t new, said Shogren, who worked on the Kyoto Protocol for the Clinton White House. But the momentum on addressing climate change, which started decades ago, continues to pick up, he said.

“This is a question that isn’t going away and even if we try to say ‘I don’t want to hear it.’ More and more people have heard it, and continue to hear it,” he said. “The question is when will we actually do something to a significant degree?”

Much has been made on the left of the conflict between the Trump administration’s efforts to deregulate and unleash energy development and the work to address climate change.

The outrage was not unfounded. The president has said at times that climate change may be a reality and at others that it is not. Those critical of climate science have found high positions in the administration, and Trump pulled the U.S out of 100-country Paris Climate Agreement in mid-2017. The agreement was the first international approach the country had joined since the Kyoto Protocol, signed by Clinton in 1998, but non-binding due to the Senate’s disapproval of China and India’s exemptions.

Distrust of climate science has become highly politicized since that time and a host of high-profile regulations from the Obama administration ended up in Trump’s crosshairs early in his administration. This led to the current revision of the Clean Power Plan, an unfinished process but one approved of in Wyoming coal country. Meanwhile, the Environmental Protection Agency and the Department of the Interior walked back on separate regulations meant to cut methane emissions. The administration has also tried to make oil and gas development on federal lands more efficient by cutting red tape.

But it’s possible that too much has been made of deregulation and climate, some say.

“We believe the current deregulatory efforts at the federal level are having less effect on oil and gas development than what some may have thought,” said Greg Haas, director of Integrated Oil and Gas at Stratas Advisors, an energy consulting firm. “That’s because energy companies are seeing pressure today from the bottom up—from social media, changes in consumer preferences, and at the local and state levels.”

Many in the industry, from drillers to pipeline developers, are preparing to deal with climate change. The U.S. oil and gas industry is the most technologically advanced in the world, and companies are looking at both their long-term strategic plans and field-level work in relation to climate impacts, Haas said.

“We clearly expect the energy industry to continually evolve towards cleaner energy, more secure and sustainable operations and higher expectations of society,” he said.

Wyoming’s industry is often more vulnerable to contractions in the oil and gas market than those in more profitable states.

For Wyoming and the Rockies to adapt going forward within a national industry that is highly productive, it will have to be nimble and it will have to improve its current infrastructure to do that, Haas said.

“To the extent pipeline and logistics developers can build with care, and convince the region that they can address environmental sensitivities well, then the Wyoming oil and gas industry should remain attractive,” Haas said.

While some of the political vitriol remains over whether climate change should be taken seriously, Wyoming’s political leaders were more receptive to the assessment’s findings than some conservatives in D.C and in the White House.

Sen. Mike Enzi was still reviewing the report Monday, but his spokesman Max D’Onofrio noted that regardless of the climate change debate, the U.S. needs to enact sensible energy policy.

“Generally speaking, Senator Enzi doesn’t focus his efforts on researching whether climate change is manmade or naturally occurring but looks at the policy options that have been proposed to address the issue,” D’Onofrio said.

The answer for the challenge of climate change is technology to clean our core energy sources while renewable sources are included in the energy mix, from nuclear to wind, he said.

Wyoming, despite its small population and remote location, currently has a strong political voice in Washington and within the Republican Party, with longtime Sen. John Barrasso heading the Senate Environment and Public Works Committee and Rep. Liz Cheney recently ascending to a leadership role in the House.

Barrasso was staunchly critical of the Obama administration’s attempt to address climate change via regulations like the Clean Power Plan. But, the senator has been among a new wave of conservative support since Trump’s election for efforts to address concerns about fossil fuel’s emissions problems through technology. Barrasso has pushed through legislation in the last year and a half to offer incentives for capturing carbon dioxide from coal burning plants and trotted out a slew of Wyoming experts in Washington to convince others of carbon capture’s appeal.

The climate report is a reminder to continue on that track, the senator said in a statement Monday.

“Wyoming is blessed with amazing energy resources. These create good paying jobs and power our state’s economy,” he said. “This report underscores the need to make Wyoming’s energy as clean as we can, as fast as we can.”

Cheney spokeswoman Maddy Weast did not directly address questions regarding the climate report but noted like the other delegates the need for technology advances and an “all of the above” approach to energy policy. The Trump administration, and Wyoming’s congressional delegates, has worked to undo the regulatory approach of the Obama years.

“The Obama Administration attempted to kill Wyoming’s coal energy and wasted tens of millions of taxpayer dollars on failed alternative energy projects like Solyndra under the guise of stopping climate change,” she said in an email. “[Cheney] will continue to fight every day to protect Wyoming’s fossil fuel industry.”

Capturing and using carbon dioxide is expensive. It gobbled up significant federal dollars during the Obama administration but lost favor as the market for coal narrowed and a new focus to meet international climate goals called for more dramatic regulations. Wyoming, however, persisted under Gov. Matt Mead with a focus on carbon capture, funding the recently-completed Wyoming Integrated Test Center in Gillette. The University of Wyoming’s School of Energy Resources has broadened its research to include ways to keep coal viable past the point where it is no longer used for electricity.

Though some may feel the state has dragged its feet on addressing climate, carbon capture and coal research is a good thing, said Shogren, the UW professor.

“Can you just leap out there and just go or do you take a few steps to get the ball rolling?” he asked. “I’m old enough to know that you got to get the ball rolling.”

The reality is that Wyoming will be facing national policy changes that are likely set by larger states like California. The state will have to find a way forward and the transition from a carbon-centric economy to a diversified one isn’t a path that is well understood yet. There’s no easy fix, not internationally where up and coming economies want to grow – like the U.S. was – by fossil fuels, nor here in Wyoming, where carbon is the backbone of the state economy, he said.

Wyoming deserves credit for making strides, in Shogren’s opinion.

“We are doing it, the question is are we doing it fast enough?” Shogren said. “Well, that’s tricky because this is a problem that’s longer than most political lives. Getting people to focus into big decisions 50 or 100 years from now is a challenge.”

Wyoming can chart its own course to some degree, said Jon Goldstein, a senior energy adviser for the Environmental Defense Fund and a frequent voice on Wyoming’s state regulations to limit methane emissions. The climate report just solidifies the need for not just coal but the oil and gas industry to concern itself with controlling emissions like methane.

“The Trump administration is hell bent on rollbacks, but (Washington) hasn’t stopped Wyoming in the past from putting requirements in that make sense for the state,” he said.

The Cowboy State has seen booms and busts, he said. They are not new to energy development or to balancing it with conservation. From former Gov. Dave Freudenthal and Mead to Gov.-elect Mark Gordon, Wyoming leaders have understood the need to balance energy and the environment.

“I expect that we’ll see the same going forward,” he said.