Texas Tech University.

 

ENCO 4362: U.S. Energy Policy and Regulation

2013 Spring

Instructors

Michael Giberson

Benjamin Powell

Office

BA W324

BA W360

Office phone

(806) 834-3161

(806) 834-0977

Email

michael.giberson @ ttu.edu

benjaminwpowell@gmail.com (best way to reach me)

Office hours

MW 10-10:50 PM, TR 11:00 AM-12:20 PM,
and by appointment.

By appointment.

Website

giberson.ba.ttu.edu

www.benjaminwpowell.com

Course outline quick links

(1) Energy efficiency    (2) Transportation    (3) Legislation    (4) Regulation

(5) Oil and gas resources    (6) Climate change    (7) Current topics    (8) Shale gas

Latest Updates

April 2: Reading assignments added

Feb. 5: Reading assignments for Feb. 7 and Feb. 12 have been revised.

Major revisions to this page and other class announcements will appear here.

 

Course Outline

ENCO 4362: U.S. Energy Policy and Regulation
2013 Spring

Please note that the course outline is subject to change before the semester begins and over the course of the semester. Any significant changes after the class begins will be noted above under "Latest Updates" and discussed in class.

Welcome

Introductions; On wishful thinking and public policy; Why have a public policy?

Jan 17
(1) Energy Efficiency
TOPICS: Conservation, energy efficiency, rebound effect, Jevons Paradox, Corporate Average Fuel Economy (CAFE) standards
  1. Rice, "Bulb In, Bulb Out," New York Times Magazine, June 3, 2011.
  2. "Not such a bright idea," The Economist, August 26, 2010.
  3. Malnick, "Retailers avoid ban on traditional light bulbs," The Telegraph, August 26, 2012.

Jan 22
  1. White House, "President Obama Announces New Fuel Economy Standards." Video.
    URL: http://www.youtube.com/watch?v=FYSaBP0YZMQ
  2. White House, "President Obama Announces Historic 54.5 mpg Fuel Efficiency Standard," Press Release, July 29, 2011, Washington DC.
  3. Portney, “Penny-Wise and Pound Fuelish,” Resources, Spring 2002.

Jan 24
  1. Lomberg, "A Dim Light on Global Warming," Project Syndicate, August 12, 2011.
  2. Graetz, The End of Energy, Chs. 1 and 2 summaries due (Link to assignment).

Jan 29
ADDITIONAL RESOURCES:
Tsao, et al., “Solid-state lighting: an energy-economics perspective,” Journal of Physics D: Applied Physics, 43 (2010).
CBO, "Fuel Economy Standards Versus a Gasoline Tax," CBO Economic and Budget Issue Brief, March 9, 2004. (HTML version)
Crandall, “Policy Watch: Corporate Average Fuel Economy,” The Journal of Economic Perspectives, (1992)
White House, "Driving Efficiency: Cutting Costs for Families at the Pump and Slashing Dependence on Oil," July 29, 2011, Washington DC.
Wikipedia on William Stanley Jevons; Wikipedia on Jevons's book The Coal Question.
(2) Transportation and Air Pollution
TOPICS: Public goods, free riders, externalities, market failure, Coasian bargaining, Pigovian tax
  1. Parry, Walls, and Harrington, "Automobile Externalities and Policies," Journal of Economic Literature, 45:2 (June 2007). (Alt. link)

Jan 31
  1. McAfee and Lewis, "Free Riders," Section 8.1 in Introduction to Economic Analysis, 2010. NOTE: See email for alternative reading assignment.
  2. Graetz, The End of Energy, Chs. 3 and 4 summaries due (Link to assignment).

Feb 5

REVISED

  1. Parry, “Is Gasoline Undertaxed in the United States?” Resources, Summer 2002.
  2. McAfee and Lewis, "Coasian Bargaining," Section 7.5 and "Pigouvian Taxes," Section 7.2 in Introduction to Economic Analysis, 2010. [THIS READING ASSIGNMENT WILL BE REPLACED]

Feb 7

REVISED

  1. Graetz, The End of Energy, Chs. 5 and 6 summaries due (Link to assignment).
  2. Johnson v. Paynesville Farmers Union Cooperative Oil Company, Minnesota, Court of Appeals, 2011.
    (Assignment: "Opinion" and "Facts" sections, the rest is optional.)
  3. Giberson, "Coasian Bargaining on Wind Turbine Noise," Knowledge Problem blog, August 2, 2010.

Feb 12
ADDITIONAL RESOURCES:
Mankiw, "Raise the Gas Tax," Wall Street Journal, October 20, 2006.
Mankiw, "Smart Taxes: An Open Invitation to Join the Pigou Club," unpublished paper presented at Eastern Economic Association, March 2008.
Joseph White, “American Idle: To Shorten Ever-Growing Commutes, Will Drivers Pay Money to Take Faster Lanes?” Wall Street Journal, Feb. 2, 2011.
Lomansky, “Autonomy and Automobility,” Independent Review, (Summer 1997).
Arthur Cecil Pigou in Concise Encyclopedia of Economics; Pigovian tax via Wikipedia.
Ronald Coase in Concise Encyclopedia of Economics.
3. Public policy and legislators
TOPICS: Politics and public policy, energy balance, energy return on energy invested (EROEI), public choice theory
  1. Open policy discussion / Initiating term paper project. (ADDED: Link to the term writing assignment page.)

Feb 14
  1. Lyons, "Political Self-interest and U.S. Environmental Policy," Natural Resources Journal (1999). (Assigned: Introduction and sections I, II, III, and VI; pp. 271-281).
  2. Graetz, The End of Energy, Chs. 7 and 8 summaries due (Link to assignment).

Feb 19
  1. Pennington, “The Lessons of Public Choice Theory,” Adam Smith Institute, 2010. Video. Part 1, Part 2 and Part 3. (Optional Part 4: Q & A). Link to handout.
  2. Term paper task #1: Topics due via email by noon today.

Feb 21
  1. Lyons, "Political Self-interest...," continued. (Assigned: Sections VII, VIII, and XI; pp. 284-289, 292-294).
  2. Yandle, "Bootleggers and Baptists: The Education of a Regulatory Economist," Regulation, Vol. 7:3 (1983)
  3. Graetz, The End of Energy, Chs. 9 and 10 summaries due (Link to assignment).

Feb 26
ADDITIONAL RESOURCES:
Texas Politics-Interest Groups, "4.1. How interest groups form," and "4.2. Concentrated benefits vs. diffuse costs."
Yandle, "Bootleggers and Baptists in Retrospect," Regulation, Vol. 22:3 (1999).
Growth Energy, "Ethanol Policy Brief," Revised November 16, 2010. Drum, “Ethanol Subsidies: Not Gone, Just Hidden a Little Better,” Mother Jones online (January 5, 2012). Smith, “Children of the Corn: The Renewable Fuels Disaster,” The American (January 4, 2012).
4. Public policy and regulators
TOPICS: Public interest theory of regulation, Interest group theory of regulation, Capture theory of regulation, Rent Seeking
  1. Texas Politics-Bureaucracy, "4.3. Interest groups," "Iron triangles," and "Theories of economic regulation."
  2. Dudley and Brito, Ch. 4, "The Regulatory Process: How is the Sausage Made?" pp. 35-53 in Regulation: A Primer (2nd ed.).
  3. Term paper task #2: Key reading due via email by noon today.

Feb 28
  1. Crandall, "Ackerman and Hassler's Clean Air/Dirty Coal," The Bell Journal of Economics (Autumn, 1981)
  2. Graetz, The End of Energy, Chs. 11 and 12 summaries due (Link to assignment).

Mar 5
  1. Mitchell, “Why Would Light Bulb Manufacturers Want to Be Regulated?” Neighborhood Effects blog (Jan. 6, 2012)
  2. Wald, “A Coal-Fired Plant That Is Eager for U.S. Rules,” New York Times (January 5, 2012)

Mar 7
ADDITIONAL RESOURCES:
Tullock, "The origin of the rent-seeking concept," International Journal of Business and Economics (2003).
Tullock, "The fundamentals of rent-seeking," The Locke Luminary (Winter 1998).
Institute for Justice, "The Road to the Supreme Court," Sep. 23, 2011 (video).
5. Oil and Gas Resource Development
TOPICS: Benefit-cost analysis, discounting, non-use value, life-cycle analysis
  1. Graetz, The End of Energy, Chs. 13 and 14 summaries due (Link to assignment).
  2. The end of The End of Energy class celebration.

Mar 19
  1. Portney, "Benefit-Cost Analysis," in Concise Encyclopedia of Economics.
  2. Brennan, "Discounting the Future: Economics and Ethics," (Also: Ch. 5 in Oates book).

Mar 21
  1. Hahn and Passell, "The Economics of Allowing More U.S. Oil Drilling," Energy Economics, 32:3, (May 2010).

Mar 26
  1. Svoboda, "Note on Life Cycle Analysis," National Pollution Prevention Center for Higher Education, (1995).

Mar 28
ADDITIONAL RESOURCES:
Opposing Views: "Should the U.S. Allow Offshore Oil Drilling?" (2008).
BP's Internal Investigation webpage on the Deepwater Horizon accident with links to reports, video, and other materials.
Krupnick, Campbell, Cohen and Parry, "Understanding the Costs and Benefits of Deepwater Oil Drilling Regulation," RFF Discussion Paper (Jan 2011).
6. Climate Change Policy
TOPICS: Market-based approaches to regulation, cap-and-trade, Pigovian tax
  1. Portney, "Market-based Approaches to Environmental Policy: A Refresher Course," Resources, Summer 2003.
  2. In class activity

Apr 2
  1. Scarborough, “Environmental Water Markets: Restoring Streams Through Trade,” PERC Policy Series, No. 46, 2010.

Apr 4
  1. Sandel, “It’s Immoral to Buy the Right to Pollute,” New York Times, December 17, 1997, and four short replies (Shavell, Maskin, Leifman, and Spataro).

Apr 9
  1. Solomon, "Climate Change's Great Divide: Lawmakers favor Carbon Tax, Trading; Economists Prefer a Tax," Wall Street Journal, September 12, 1997.
  2. Various authors. "Putting a Price on Carbon: An Emissions Cap or a Tax?" Yale Environment 360, May 7, 2009.
  3. Term paper task #4: Rough draft due via email by midnight on Friday, April 12.

Apr 11
ADDITIONAL RESOURCES:
Greenspan Bell and Russell, " Environmental Policy for Developing Countries," Issues in Science and Technology (Spring 2002).
Stavins, "Experience with market-based environmental policy instruments," RFF Discussion Paper 01-58 (2001).
Schneider and "Achieving low-cost emissions targets," Nature (September 4, 1997).
Harmon, "How the market can keep streams flowing," TEDxRanier (video), November 2010.
7. Current topics in u. s. energy policy
  • Term paper task #5: Panel discussions (1)

Apr 16
  • Term paper task #5: Panel discussions (2)

Apr 18
  • Term paper task #5: Panel discussions (3)

Apr 23
  • Term paper task #5: Panel discussions (4)

Apr 25
8. Shale Gas and the Environment
TOPICS: Externalities, Rights and liability, Ronald Coase, Coase theorem
  1. Bennear, "Fracking externalities and the Coase Theorem," Environmental Economics and Policy Blog, September 5, 2011.
  2. Worthington, "There is no fracking way polluters won't be bad actors," Smart Planet, January 31, 2011.
  3. Andrew Reinbach, "Stop Gas Drilling: Sue your Neighbor," Huffington Post.

Apr 30
  1. Gilbert and Gold, "As big drillers move in, safety goes up," Wall Street Journal, p. A1, April 2, 2013.
  2. Schwartzel and Hopey, "New initiative sets standards for Marcellus Shale drilling in Pa. and Appalachian basin: Unlikely gathering of interests reaches drilling standards," Pittsburgh Post-Gazette, March 21, 2013.
  3. Doniger, "Leading Companies Already Meet EPA's 'Fracking' Air Pollution Standards," Switchboard (NRDC staff blog), April 18, 2012.

May 2
  1. Readings TBA [Current issue surrounding oil/gas development - 3]

May 7
ADDITIONAL RESOURCES:
National Geographic's Special Report: The Great Shale Gas Rush
Haynesville documentary and Gasland documentary.
PSU Extension Service, "Can a drilling company steal your gas?" (Video).  Related: Full list of PSU natural gas videos.
Ronald Coase in Concise Encyclopedia of Economics; Ronald Coase at the History of Economic Thought website; Coase's Nobel Prize.
Krauss, "Property Rules vs. Liability Rules," in Encyclopedia of Law and Economics.

FINAL EXAM: 1:30-4:00 PM on Tuesday, May 14.

 

Syllabus

ENCO 4362: U.S. Energy Policy and Regulation
2013 Spring

Course description

The course will examine U.S. government policy and regulation affecting the energy industry and energy consumers with a focus on the policy making process and the methods of policy analysis.

Course materials

·         Michael J. Graetz, The End of Energy, MIT Press (2011).

·        Additional readings will be available online via links on this class website.

Expected learning outcomes

After completing this course, students will be able to:

Methods of assessing outcomes

The expected learning outcomes will be assessed by review of class participation, quizzes, writing assignments and performance on the final exam.

Class participation/Present and Prepared: Students are expected to read the assigned material, contribute to class discussions and participate in other in-class activities. See details of the "Present and Prepared" policy below under Additional Class Policies.

Section quizzes: Unannounced quizzes on the readings will be given about 7 times during the semester (the lowest two quiz grades will be dropped).

Writing assignment - The End of Energy: We will read Michael Graetz's new book on U.S. energy policy, The End of Energy, during the first half of the semester. Each student must turn in chapter summaries on the due dates noted in the course outline online.

Writing assignments - Term paper: Each student must research and write a term paper on an issue of current interest in U.S. energy policy or regulation. Additional details on the requirement will be presented during the semester.

Final exam: Test scheduled for 1:30-4:00 PM, Tuesday May 14.

Grading
Class participation 11%
Section quizzes 25%
The Energy of Energy chapter summaries 14%
Term paper 25%
Final exam 25%
Additional class policies

In general, the class will follow standard university policies as described in the Texas Tech University Operating Policies (http://www.depts.ttu.edu/opmanual/).  In addition, please note:

Academic honesty:: It is the aim of Texas Tech University to foster a spirit of complete honesty and high standard of integrity. Academic dishonesty will not be tolerated and will be treated according to the rules outlined in the Student Handbook.

Absences: A student who will miss class due to a university-approved trip, recruiting appointment, or to observe a religious holy day should make the intention to miss class known to the instructor via email prior to the absence so that accommodations can be made in accordance with university policies. When you miss class, it is your responsibility to catch back up. The class website and your fellow students should be your first recourse in such cases.

Disabilities: Any student who, because of a disability, may require some special arrangements in order to meet course requirements should contact the instructor to request necessary accommodations.

Present and Prepared: What does it mean to be "present and prepared"? You must have read or viewed the assigned material (and any material left over from the prior class) and be prepared to discuss the material in class.

Students will gain the most from class periods - and their classmates, too - if they come to class prepared to contribute. At the beginning of most classes this semester, the instructors will provide a class roll for students to sign in if they are "present and prepared." If you sign in as "present and prepared" at least 85 percent of the time, you will earn all 11 class participation points. If counted present and prepared fewer than 85 percent of the time, you'll earn fewer class participation points. (From 80-85 percent, then 10 points; if 75-80 percent, then 9; if 70-75 percent, then 8. If counted "present and prepared" fewer than 70 percent of the time, you will obtain 6 or fewer points.)

Syllabus and course outline changes: The instructor may adjust the syllabus or course outline during the course of the semester. Updated versions of the syllabus and course outline will be maintained on the class website (http://giberson.ba.ttu.edu/ENCO4362). Note in particular that the "present and prepared" policy is new in my classes this semester and some adjustments may be made. Any adjustments will be noted in class and on this website.