Pope Francis has led the Catholic Church for less than two years. But during that short window, he has breathed new life into a religion struggling with apathy and scandal; earned the praise of social justice activists around the world for an intense focus on poverty; and even played a role in ending a half-century-old stalemate between Cuba and the United States.

So environmental activists were excited to read in The Guardian last week that Francis will add to this busy agenda by making climate change a top priority in 2015.

Like many of Francis’ high-profile statements and actions, the move is simultaneously rooted in the Catholic Church’s teachings and somewhat unprecedented.

Francis is not the first pope to tackle climate change. Both of his immediate predecessors — church leaders with well-established conservative roots — spoke bluntly on the matter. But the formal document Francis plans to issue later this year will be the first time a pontiff has devoted the entire text of a papal encyclical to environmental issues.

Environmentalists hope the document could provide momentum to the push to curb greenhouse gas emissions ahead of December’s United Nations climate conference in Paris.

Francis has generated global headlines for comments ranging from whether gay men can serve as priests to the validity of the Big Bang theory. All of these remarks came during speeches or off-the-cuff statements at press conferences and papal audiences. Preparing a formal statement of church policy, called an encyclical, is much different.

"While popular media is always enthusiastic about any new utterance by this beloved pope, not all utterances are created equal in the realm of the Catholic Church," explained Christiana Peppard, an assistant professor of theology, science and ethics at Fordham University.

"An encyclical is a document that has one of the highest forms of authority of any teaching in the church."

Recent popes have regularly called for more environmental stewardship, and they’ve spoken out on the specific topic of climate change, but no encyclical to date has solely focused on the environment.

"This is really exciting," said Jame Schaefer, an associate professor of systematic theology and ethics at Marquette University.

"For people who are already engaged [on climate change], it’s very exciting to have that affirmation from the head of a church. It’s important for them to … feel, wow, we’ve got a leader from a world religion speaking up."

Many Vatican observers view a recent speech by Argentine Bishop Marcelo Sanchez Sorondo as a kind of preview of what Francis will call for in the document. In the November speech, Sorondo said, "If current trends continue, this century will witness unprecedented climate change and the destruction of the ecosystem, with tragic consequences for us all. Human action that doesn’t respect nature has a boomerang effect on human beings, creating inequality."

On a wide range of topics, Francis has departed from the conservative style and substance of his immediate predecessors, Benedict XVI and the recently canonized John Paul II. That’s not the case with climate change.

John Paul delivered high-profile remarks on the topic as early as 1990. "The gradual depletion of the ozone layer and related ‘greenhouse effect’ has now reached crisis proportions as a consequence of industrial growth, massive urban concentrations and vastly increased energy needs," he said during a World Day of Peace message.

Benedict earned praise as "the green pope" from some quarters for a series of symbolic actions on climate change. He installed solar panels near St. Peter’s Basilica, used offset purchases to make Vatican City the world’s first carbon-neutral state and even purchased an electric "Popemobile" (Greenwire, March 1, 2013).

In a wide-ranging 2009 encyclical, Benedict addressed energy consumption. "The technologically advanced societies can and must lower their domestic energy consumption," he wrote, "either through an evolution in manufacturing methods or through greater ecological sensitivity among their citizens. It should be added that at present it is possible to achieve improved energy efficiency while at the same time encouraging research into alternative forms of energy."

But Benedict’s 2009 document didn’t exactly galvanize the world’s 1 billion Catholics to reduce their carbon emissions. The fact is, Peppard said, "most lay people … don’t read encyclicals. They’re a somewhat heavy and plodding genre."

Environmental advocates hope Francis’ growing global appeal and clout could lead to a different outcome. "A lot of people in positions of power would love to have his approval ratings. He’s enormously popular," said Dan Misleh, the executive director of the environmental group Catholic Climate Covenant.

"This is the rock-star pope," said 350.org spokesman Jamie Henn. "For him to take bold leadership on climate change and go beyond the usual rhetoric would send shockwaves through the global community." The climate activist group is urging Francis to take the message a step further and divest the church’s massive financial portfolio from the oil and gas industry.

The encyclical’s timing could help its message resonate beyond church theologians. The Vatican is expected to release the document in the coming months, ahead of a high-profile U.N. summit on climate change in Paris. And with Francis likely to visit and address the United Nations in New York City this fall, the encyclical could provide the pontiff with material to address the issue head-on to a room full of global leaders.

The most noteworthy message from the American Petroleum Institute’s 2015 annual report isn’t its finding that the U.S. oil industry is experiencing a "petroleum renaissance" born of a drilling boom in domestic fields such as the North Dakota’s Bakken and Texas’ Eagle Ford shale formations.

Those findings, along with the United States’ near self-sufficiency in meeting domestic oil and natural gas demand, were expected from the nation’s leading fossil fuel lobbying group.

An unexpected appearance in API’s latest "State of American Energy" report was API’s gift of space to alternative and traditionally competing energy sources such as nuclear, solar, wind, hydro, biomass and geothermal energy, all of which have positioned themselves as environmentally preferred alternatives to carbon-intensive fossil fuels like oil, gas and coal.

In fact, roughly 20 pages of the 50-page document are dedicated to energy resources that have no relationship to oil and gas, with chapters titles like "Solar Energy in America Shines Bright" and "The Attributes of Wind Energy Are Adding Up."

The authors of those sections were also not from API or even independent energy analysts, but representatives of the nation’s leading renewable energy trade groups, many of which have been feisty critics of the fossil fuel industry on matters ranging from pollution to climate change to the proper use of government subsidies.

Consider the opening lines of API’s assessment of solar energy: "Few things threaten America’s future prosperity more than climate change," the report states. "But there is growing hope. Every 2.5 minutes of every single day, the U.S. solar industry is helping to fight this battle by flipping the switch on another completed solar project."

Such language may give heartburn to climate change and renewable energy skeptics — including many of the oil industry’s traditional allies. But API officials say the message is consistent with the organization’s long-held belief in an "all of the above" energy strategy that embraces both traditional fossil fuels and alternative energy resources large and small, from nuclear power to geothermal energy.

Jack Gerard, API’s president and chief executive officer, drove home the energy inclusiveness theme in his own introduction to the 2015 report.

"Energy is inseparable from America’s economic growth and job creation, upon which rests a thriving quality of life and secure future for generations to come," he said. "The constant pursuit of innovation, driven by both robust competition and entrepreneurial spirit, has enabled the United States to safely develop a spectrum of energy resources.

"With smart public policy choices and a regulatory system that supports domestic energy opportunities, the United States can realize a prosperous energy tomorrow characterized by energy abundance and economic security," he added.

But while API embraced a more diverse energy strategy, Gerard’s public remarks made clear that oil and gas remained at the heart of the organization’s mission. "The fact is fossil fuels will continue to take the lead in providing most of the world’s energy needs well into this century," he said in a speech at the Ronald Reagan Building on Pennsylvania Avenue.

Gerard pointed to a recent Energy Department prediction "that 25 years from now, oil, natural gas and coal, collectively, will account for 80 percent of the country’s energy consumption." And he urged federal policymakers to encourage expanded oil and natural gas production and to walk away from policies that he said are "mired in our nation’s decades-long energy scarcity past" and do not acknowledge the dramatic domestic shale boom that has upended the world’s oil and natural gas markets.

For their part, renewable energy advocates welcomed the chance to disseminate their messages in a report that is widely read by energy policymakers, industry groups, and independent experts both inside and out of Washington, D.C.

Ken Johnson, vice president of the Solar Energy Industries Association, said in an email that this year’s API report is the first to include such an extensive overview of solar and other non-fossil energy resources. "To its credit, API clearly recognizes the importance of renewable energy to America’s future, as well as the importance for our nation to have a balanced energy portfolio moving forward," he said.

In a blog post, the American Wind Energy Association noted that API’s 2015 "State of American Energy" report included an entire section on the growth of wind power. That stands in sharp contrast to a year ago, when API’s report "did not mention wind once," the group said.

Droves of new staffers are moving into top jobs on energy and environmental committees, now that the 114th Congress is officially underway.

Incoming GOP committee leaders are staffing up in the Senate as they prepare to fight the Obama administration’s energy and environmental agenda, while leadership changes in the House are sparking further staff shakeups across Capitol Hill. Meanwhile, some former staffers are shifting to work for other lawmakers or leaving the legislative branch after their former bosses retired or lost their races or committee posts.

It’s a familiar shuffle that occurs at the start of each new Congress, and the new hires will be helping to set the tone on Capitol Hill this year when it comes to energy and environmental issues.

In the Senate Environment and Public Works Committee, Ryan Jackson will be taking over as staff director under incoming Chairman James Inhofe (R-Okla.) (E&E Daily, Dec. 16, 2014).

Dimitri Karakitsos will be staying on as EPW Republicans’ senior counsel, and Brittany Bolen will remain on staff as Republican counsel, according to Inhofe spokeswoman Donelle Harder. Karakitsos started on the EPW staff in 2009, when Inhofe was the top Republican, and he stayed on when Sen. David Vitter (R-La.) took over as ranking member in 2013. Bolen joined the committee in 2013.

Harder — an Inhofe communications aide since 2012 — will be the new EPW communications director. Harder said more staffing announcements will be made after Inhofe is elected chairman.

Major shakeups aren’t expected on EPW’s Democratic staff, where Bettina Poirier will remain staff director and chief counsel. Poirier has been a top aide to ranking member Barbara Boxer (D-Calif.) since 2005.

On the Senate Energy and Natural Resources Committee, the new chairwoman, Lisa Murkowski (R-Alaska), has added several new staffers to her roster. Colin Hayes, a former lobbyist with McBee Strategic Consulting, is the committee’s new deputy staff director. Michael Pawlowski, formerly Alaska’s deputy commissioner of revenue, was recently hired as an energy and natural resources adviser (E&ENews PM, Dec. 3, 2014).

Karen Billups is staying on as GOP staff director for the panel; she’s been on the committee’s staff since 2003.

Across the aisle, Sen. Maria Cantwell of Washington is staffing up, now that she’s become the top Democrat on the ENR panel.

Cantwell has hired her former staffer Angela Becker-Dippman to return to Capitol Hill to become her staff director. Becker-Dippman has been working as a senior policy adviser in the energy and environment unit of the Department of Energy’s Pacific Northwest National Laboratory in Richland, Wash., and previously worked for McBee Strategic Consulting after a stint on Capitol Hill working on energy policy for Cantwell (E&ENews PM, Dec. 18, 2014).

Rep. Frank Pallone (D-N.J.) is bringing in new staff to the House Energy and Commerce Committee minority office as he takes over the top Democratic spot from retired California Democrat Henry Waxman.

Many of Waxman’s former staffers — including several longtime aides — have left their posts, and Pallone has begun to fill their slots.

Jeffrey Carroll is the new Democratic staff director, and Tiffany Guarascio has been appointed deputy staff director. Carroll is a longtime Pallone aide who has been chief of staff in the New Jersey Democrat’s personal office. Guarascio has been working as legislative director in Pallone’s office.

Timothy Robinson, who’s been working as senior policy counsel and legislative director for Rep. Bobby Rush (D-Ill.), is the new chief counsel for Energy and Commerce Committee Democrats. Ashley Jones has been hired as director of outreach and member services; she was previously chief of staff to former Rep. John Barrow (D-Ga.), who lost his 2014 re-election bid.

Michael Goo and Jacqueline Cohen have been heading up the panel’s energy and environmental work in recent months, but Democratic staffing for the Energy and Power Subcommittee and the Environment and Economy Subcommittee is still being worked out. Goo was a longtime congressional staffer before working at U.S. EPA and DOE during the Obama administration; he returned to the Energy and Commerce Committee in July. Cohen is a longtime Waxman staffer.

The Energy and Commerce Committee Republican roster working under staff director Gary Andres is expected to remain largely the same this year. The panel, led by Chairman Fred Upton (R-Mich.), promoted Karen Christian to become its top lawyer in October and hired former Boeing executive Charles Ingebretson to be the Oversight and Investigations Subcommittee’s chief counsel (Greenwire, Oct. 10, 2014).

Rep. Lamar Smith (R-Texas) will remain chairman of the House Science, Space and Technology Committee this year, but the panel is still seeing some staff changes.

Two new staffers have been hired from the Oversight and Government Reform Committee. Molly Boyl is the Science panel’s new deputy general counsel and parliamentarian, which was also her role on the oversight committee under former Chairman Darrell Issa (R-Calif.). And Mark Marin, former deputy staff director for oversight under Issa, is now the Science Committee’s staff director for the Energy and Environment subcommittees.

Todd Johnston, who has been Republican staff director for the Environment Subcommittee, is expected to soon leave the committee. Stephen Sayle, previously staff director for the Energy Subcommittee, has already left the committee.

The new Oversight and Government Reform chairman, Jason Chaffetz (R-Utah), announced a new spate of staffers last month. Former Podesta Group principal Sean McLaughlin is the committee’s staff director; former Chaffetz senior adviser Rachel Weaver is the new deputy staff director. Andrew Dockham is the new general counsel, joining the panel from the Senate Homeland Security and Governmental Affairs Committee. Steve Castor is the new deputy general counsel for oversight and investigations, and Ryan Little is the committee’s operations director (E&ENews PM, Dec. 2, 2014).

Incoming House Natural Resources Chairman Rob Bishop (R-Utah) has also shaken up staffing on the panel that oversees federal lands, wildlife and fisheries. Bishop announced in late November that he had hired committee veterans Jason Knox as staff director and Todd Ungerecht as deputy staff director.

Bishop appears to have cleaned house, as at least 11 staffers have departed from the panel. The staffers who have left include former Chairman Doc Hastings’ (R-Wash.) staff director, Todd Young; Tim Charters, who was staff director for the Energy and Mineral Resources Subcommittee; Amanda Tharpe, who handled onshore energy development on the EMR Subcommittee; and several others (E&E Daily, Jan. 6).

The 114th Congress was less than an hour old before esoteric procedural disputes threatened to hamstring the Senate’s agenda — of course, this time, it was minority Democratic objections upending the plans of the new Republican majority.

Amid the pomp that usually surrounds the start of a legislative session — including the newly elected taking their oaths of office and posing for family photos with Vice President Joe Biden — the incoming Senate Republican majority was laying the groundwork to take up one of the most controversial energy-related debates: whether to approve the Keystone XL oil pipeline from Canada.

But it didn’t take long for Senate Democrats to borrow a page from their GOP colleagues’ playbook of recent years and gum up the procedural works. Democrats objected to a procedural move that would have allowed an Energy and Natural Resources Committee hearing today on KXL-approval legislation.

Meanwhile, Majority Leader Mitch McConnell (R-Ky.) used tools at his disposal to set up a direct floor vote on Sen. John Hoeven’s (R-N.D.) newly introduced S. 1 to approve the pipeline’s transboundary crossing, a bill the White House yesterday threatened to veto (E&ENews PM, Jan. 6).

The ENR Committee hearing that was scheduled for this morning has been canceled, but a markup planned for tomorrow could still proceed. A GOP leadership aide said yesterday that he expected the bill would still move out of committee tomorrow and a procedural vote to advance the bill on the floor would come Monday, followed by a robust amendment process that could stretch on for weeks.

Republicans said Democrats shot themselves in the foot by blocking today’s hearing, accomplishing little beyond denying themselves an opportunity to voice concerns about the pipeline and hear from their own expert witnesses.

"You know the signal it sends — I don’t think they really thought that through, because why start off as being the obstructionists?" said Sen. James Inhofe (R-Okla.). "It doesn’t make any sense, and besides that, it’s not going to change anything. We’re still going to do it."

But Democrats say McConnell’s move means the GOP, on day one, broke its commitment to regular order.

"By moving to bypass committees on the first bill of the new Congress, Senator McConnell is signaling that his promises of regular order have already expired and that he sees committees as nothing more than rubber stamps for Republican leadership," said Adam Jentleson, spokesman for Senate Democratic Leader Harry Reid (D-Nev.).

Teeing up Keystone as the first order of business opens the door to a variety of energy- and climate-related amendments, and Democrats are eager to offer controversial measures that could cause headaches for Republicans, especially those facing tough races next year, such as New Hampshire Sen. Kelly Ayotte. For example, one amendment Democrats are expected to file would increase funding for the Low Income Home Energy Assistance Program (LIHEAP), a key issue for New England states, paid for by raising royalty rates for oil companies, a proposal Republicans tend to resist.

Sen. Joe Manchin (D-W.Va.), his party’s most vocal KXL supporter and a co-sponsor of the bill, suggested his fellow Democrats were being hypocritical in blocking today’s hearing after decrying GOP procedural tactics for years. He said he was unaware of the planned objection before it happened and would probe his colleagues to learn more when the caucus meets for its first weekly policy lunch of the year today.

"They were always saying the reason we can’t get to a bill is because the Republicans are objecting to everything. Then we’re going to start out with the first bill and do the same?" Manchin said yesterday evening. "It doesn’t make any sense to me at all."

Adding fuel to the fire surrounding KXL, White House spokesman Josh Earnest said that President Obama would likely veto whatever lawmakers send him. The Republican response was swift.

"This is simply another sign that President Obama is hopelessly out of touch and has no plans to listen to the American people or champion their priorities," House Speaker John Boehner (R-Ohio) said in a statement.

Many Republicans, and the Democrats who agree with them on issues like KXL, read more into the veto threat. They see it as evidence of an emboldened White House ready to push its agenda.

"I hoped different," said new House Natural Resources Chairman Rob Bishop (R-Utah). "If the first stuff that we send over there is automatically vetoed, what that simply says is we’re going to have a very difficult relationship moving forward."

American Petroleum Institute CEO Jack Gerard said yesterday in a gathering with reporters that the veto threat doesn’t bode well for the administration’s relationship with Congress, especially because the KXL bill has 60 supporters of both parties and will likely get several more votes.

"If you look at the veto threat, obviously you’ve got to get to 67 if you’re going to override the veto," Gerard said. "We believe today that there are probably 63 votes in the Senate for the Keystone XL pipeline."

He added, "I’m also aware that there are other senators who have voted against this in the past that have said ‘I’m getting tired of this, with the indecision,’ who have indicated they may be willing to change their vote."

The president has scheduled a meeting with lawmakers for next week, and Earnest said Obama would be seeking common ground despite disagreements. Asked whether the meeting meant the president would try a charm offensive with lawmakers, Earnest quipped about past efforts, "It worked great, didn’t it?"

Using a pipeline metaphor, Earnest said a spirit of good feeling flows both ways. "Maybe it raises questions about the willingness of Republicans to actually cooperate with this administration when you consider that the very first bill that is introduced in the United States Senate is one Republicans know the president opposes" because of the ongoing State Department review, he said.

Getting enough votes in both the Senate and House to override a presidential veto seems unlikely. When asked if pro-KXL forces have the votes, Bishop said, "You can answer that question yourself."

With that in mind, many Democrats now see the whole debate as wasting time on political messaging. "Now that President Obama has said he will veto the latest attempt by Republicans to approve the Keystone pipeline," said Sen. Ed Markey (D-Mass.), "Keystone is now just political kabuki theater."

Bishop shot back, noting that Republicans are now in control of both chambers. "Harry Reid doesn’t set the agenda," Bishop said. "We [Congress] are a sovereign body. We send [the president] what we want to send him."

Like Hoeven, Bishop said there would be other chances to advance KXL on Capitol Hill following a veto. "If you want to be creative and think differently, there’s all sorts of options that are out there," he said. "But you’re jumping the gun right now."

Rep. Kevin Cramer (R-N.D.) introduced the House version of the bill, H.R. 3, yesterday. The Rules Committee is scheduled to meet this morning to set debate parameters.

Schedule: The Rules Committee hearing is Wednesday, Jan. 7, at 10:30 a.m. in Capitol H-313.

HOLTWOOD, Pa. — As the sun sets over Cover Crop Solutions’ sprawling fields, a small group huddles around Ray "The Soils Guy" Archuleta.

The cluster, which includes two Amish men, a fledgling Pennsylvania grape grower and a farmer-turned-feed salesman, are captivated by Archuleta, an animated soil scientist with the Agriculture Department’s Natural Resources Conservation Service. He rubs the dirt in his fingers and takes in deep inhalations from a handful of soil. He answers questions on manure, planting seasons, even healthy food choices. It’s not easy, he says. There’s a balance of tilling, pest control, watering and cover crop planting that can make or break a harvest.

"Expect to fail," Archuleta tells the huddle. But when that balance works, it can bring greater yields, cleaner water and lower costs over time.

Archuleta’s small audience, along with nearly 300 others, have come to Cover Crop Solutions field day, a showcase of the seed company’s products, as well as a place for farmers to talk shop. The company is one of a handful that deal exclusively in seeds for cover crops — plants that make the ground more fertile, reduce the risk of harmful algae blooms and help control soil from running into waterways during heavy rainstorms.

For years, conservationists have encouraged growers to plant "green manure," as it was once called. It’s no cash crop, but the benefits will far outweigh the costs, they say.

The number of cover crop acres has nearly doubled since 2009, according to NRCS figures. In Maryland, where the Chesapeake Bay’s poor water quality has driven generous state-led cover crop incentives, the state Department of Agriculture announced a record number of acres enrolled in the 2014-15 crop year.

Recent studies find they can boost production, too. A 2,000-grower survey released in November found corn and soybean yields in fields that had been planted with cover crops experienced significant yield increases (Greenwire, Nov. 18).

Still, cover crops can be a hard sell. Keep them in too long and they might crimp a cash crop’s growing season, say some farmers. If they infuse too much nitrogen into the soil, they could make leguminous plants like soybeans "lazy" and less productive, say others. Another concern is that the seeding of corn within the cover could invite unwanted insects.

Steve Groff, the founder of Cover Crop Solutions, wants to seize on the recent growth. A third-generation farmer in Lancaster County, Pa., Groff was an early adopter of cover crops on his 225-acre farm, where he grows pumpkins, tomatoes and other crops.

He fell hard for one in particular: the Tillage Radish, a crop he developed himself that served as the catalyst for the company’s creation.

The radish is a long, daikon-like white root that infuses nutrients into the soil, loosens the dirt and reduces the need for tillage. In 2000, Ray Weil, a University of Maryland soil scientist who was experimenting with cover crops on Groff’s land, went to Brazil and saw farmers using radishes to treat pests called nematodes in the soil. He tried the practice on Groff’s farm.

"I saw right away what it was doing," said Groff. There were yield increases in every plot. Groff started testing all kinds of radish seeds to determine which ones boosted cash crop yields. Seeds were fairly expensive, so he began to grow his own. Equipment at that time was costly, too. It took between $20,000 and $30,000 to adjust a corn and bean combine to harvest radish seeds.

Eventually, Groff developed the Tillage Radish strain. He began selling the seed to friends and neighbors in 2004. Six years later, he brought in two partners to launch Cover Crop Solutions, bringing the radish to commercialization. Today, the company employs 20 people. Groff functions as a consultant, and works on research and development. In addition to his Lancaster County farm, there are research sites in Iowa, North Carolina and Memphis, Tenn.

The Tillage Radish is one of the most popular cover crops, but it’s far from the only one. Groff calls it the "cover crop with training wheels" — easy to use, with noticeable improvements to soil quality. The company is beginning to develop several mixes suited to growers’ needs. There’s a mix with ryegrass and crimson clover, along with plant combinations that sound more like ingredients for a Harry Potter potion than the next big thing for farmers: hairy vetch, sunn hemp and sweet blue lupin.

After a decade of encouragement from government players, notably NRCS, the private sector is catching on. But the movement is far from mainstream. Dawn Equipment Co. has created a machine to plant commodity crops directly in the cover crop bed, which allows the grower to place seeds in the soil consistently so the plants come up at the same time — the first private company to do so using Penn State’s technology. Dawn also sells a planter attachment that allows planting directly into a green cover crop in the spring without needing herbicides to manage the cover crop.

Large equipment manufacturers such as John Deere are unlikely to follow suit anytime soon, said Groff.

"They’re not considering competing with us; there’s not an interest in diving in to that degree, and that’s just fine with me," he said.

Big seed companies are timidly dipping their toes into the market, however. Monsanto Co. has joined with the Nature Conservancy and the National Corn Growers Association on a soil health initiative to "build a network of demonstration research farms," among other goals — but declined to disclose the company’s research and development budget for cover crops. Another larger seed company, Syngenta AG, also didn’t say how much it invests in cover crops.

"It’s getting their interest, but just [now] is getting their interest," said Barry Fisher, a soil health specialist in NRCS’ Indiana office. "If the demand is there, it will attract the interest of the larger corporations."

That demand may be more difficult to attain this year, as the United States is slated to grow a record or near-record crop for corn and soybeans. The bountiful projected yields are already lowering futures prices, and agriculture economists are predicting lower incomes for farmers. A lack of disposable income could turn them off from cover crop experiments for now.

"They look at a cover crop as a dollar going out," said David Hamish, 54, a feed salesman who once owned 67 cows and 250 acres of crops before Hamish’s landlord passed the land over to his son.

For years, there were concerns that cover crops might make a farmer ineligible for crop insurance, said Maggie Monast, a senior policy analyst with the Environmental Defense Fund. Although USDA’s Risk Management Agency has changed its guidance to avoid conflicts, the perception may still be a hindrance.

Roughly 40 percent of the farmland in the United States is rented, not owned. On these lands, there’s less incentive to wait for better soils down the road, Monast added.

To date, much of the scientific research has centered on how cover crops benefit the environment. This works well in the Chesapeake Bay watershed, where in Maryland, Delaware and Virginia, growers are required to submit nutrient management plans that minimize the loss of nutrients from the soil into the bay’s tributaries. In other agricultural regions, where farmers are less regulated, other pulls are needed.

While the benefits to the environment are clear, there’s still not much known about how well cover crops will save a grower money in store-bought fertilizer, said Tracy Blackmer, the resident research scientist for Cover Crop Solutions. This is where private companies such as Cover Crop Solutions come in.

Blackmer has been to countless conferences where farmers ask experts what sort of "nutrient credit," the amount of fertilizer a crop can displace, they should account for in the following year. Most of the time, there’s no answer.

"When we start asking questions about what is the nutrient credit for the next year, or what are you going to do to try to manage nematodes … those type of things are way behind in terms of the amount of money spent on research and the research done," Blackmer said.

In a study, Blackmer found that fields planted with Tillage Radish in August 2013 saved growers about 130 pounds of nitrogen fertilizer per acre of corn in 2014. Some cover crops have also been shown to help reduce cyst nematodes on soybeans, where treatment can be costly and rarely effective, Blackmer said.

For this kind of research, universities are a bit stuck, he said, and large agribusinesses are only marginally interested. Companies such as Monsanto might change a corn trait every two years, and it could be seen as a waste of money to adapt cover crops at the same pace. As for universities and land grant colleges, choosing between varieties runs counter to the academic culture, said Blackmer.

"They think one variety over another sounds more like a sales tactic than a research project," he said.

Eileen Kladivko, a professor of agronomy at Purdue University, has another explanation: The conservation benefits of cover crops are easier to study because they appear sooner.

"The benefits to farmers do not generally accrue right away," she said. "You can’t expect to get a benefit in the first couple of years of using cover crops, whereas some of the environmental benefits occur immediately." Reductions in nitrates, the chemicals that promote algae blooms that kill aquatic life and make humans sick, can be seen in the first year.

There isn’t a dichotomy between farm and conservation benefits in research, added Kladivko. Most scientists are looking at both, but it’s more difficult to sell a longer-term proposition. Trying to lure growers into thinking a little cover this year will mean less inputs next year is not a prudent strategy.

"Oh, heck, I never say that!" said Kladivko, when asked whether she ever presents cover crops as a way to reduce fertilizer amounts. With time, a couple of decades or so, and the type of crop, a nitrogen-fixing legume, that may happen. More realistic farmer benefits include increasing soil organic matter, which leads to higher water retention, more resilience to drought and better aeration of roots.

Back on Groff’s farm, the frustration is apparent. The carrot — or, more appropriately, the radish — of benefits in front of growers is still far away.

"You’re telling me where to go, but you’re not telling me how to get there," Samuel Stolzfus, 53, a rotund Amish farmer, tells Archuleta during his presentation.

"You need to tell me the way to your house," Archuleta answers.

The Forest Service abandoned a $10 million rebranding effort today after the proposal sparked opposition from some employees and a government watchdog group.

The agency had announced plans in November to hire an outside firm to help it achieve "strategic organizational transformation, identity clarification and social purpose branding and branding management, and multicultural engagement and outreach."

The request for proposals, which closed just before New Year’s Day, offered up to $10 million over the next five years.

Some called it a smart investment that could have boosted employee morale, bolstered public trust and strengthened support from Congress.

Others called it a waste of money that could have been better spent restoring watersheds, building trails, thinning unhealthy forests or beefing up staff.

But the agency is putting the effort on the backburner, for now.

"No bids from this proposal were accepted," a Forest Service spokesman said. "The Forest Service will continue to seek other ways to enhance citizens’ access to the nation’s forests and grasslands, and increase citizens’ knowledge of the services available to them."

The plan had stirred debate among the agency’s 35,000 employees, some of whom took umbrage at hiring an outside firm to help the Forest Service find its identity.

"Nothing like this has ever been done before," said Andy Stahl, executive director for Forest Service Employees for Environmental Ethics and a critic of the plan. "There is a substantial level of disagreement in national leadership on whether this is a good idea."

The agency manages 193 million acres of national forests and grasslands for multiple uses including timber, grazing, wildlife, research, recreation and conservation. Those often-conflicting mandates from Congress are tough to articulate in an elevator speech, let alone communicate to the general public.

Its stated mission is "to sustain the health, diversity and productivity of the nation’s forests and grasslands to meet the needs of present and future generations."

The presumed front-runner for the branding contract was Metropolitan Group, a Portland, Ore.-based "social change" firm that the Forest Service previously tapped to help its Pacific Northwest region "reflect on its roots and discover its future."

The firm said it helped the region’s 3,000 employees in Oregon and Washington state "rediscover" the mission outlined by the Forest Service’s first chief, Gifford Pinchot: "to provide the greatest amount of good for the greatest amount of people in the long run."

"We clarified the region’s core identity using the greatest good as a frame to unify and communicate a complex array of ideas and work," Metropolitan Group said on its website. "From this foundation we crafted a new vocabulary, look, and feel that employees are already using to more successfully engage with each other and the public."

A sample of the firm’s work can be found here.

Metropolitan Group has also been contracted by the Forest Service’s Intermountain region based in Ogden, Utah, and the Pacific Northwest Research Station to "foster a more powerful and shared appreciation of agency mission amongst internal and external stakeholders."

The total value of its contracts is believed to exceed $1 million.

The regional efforts were a "starting point for an agency-wide undertaking to prepare its workforce to engage in a cultural transformation and identity clarification," according to the Forest Service’s November RFP.

Metropolitan Group currently holds a $527,000 contract that runs through next month to help Forest Service leaders take the regional branding and identity effort nationwide.

The firm recently opened a Washington, D.C., office at 1029 Vermont Ave. NW, saying on its website that "the White House and other federal sector clients — including NASA and the U.S. Forest Service — are just a short walk from our office."

The $10 million national branding effort for the service was billed as a "follow-on" contract, with Metropolitan Group as the incumbent contractor.

Stahl, of the forest employees group, questioned its merits.

"Who decided that the Forest Service needs a new brand and identity?" he said. "Is Smokey dead?"

Stahl said it’s unclear where the money would have come from in the Forest Service budget and why current staff could not perform the tasks in-house, which would save money to maintain trails or decommission roads.

He said few within the agency admitted knowing about the contract and none had been willing to talk about it.

Some employees bristled at the proposal.

"The mission of the Forest Service is what it has always been: protecting the land and serving people," said one employee, who wished to remain anonymous in order to speak freely. "Why is it necessary to hire a contractor to figure out that we need more boots on the ground protecting the land? It is that simple."

A fresh brand and better public engagement could help, but it won’t fix deteriorating recreational sites and trails and declining forest health, said another employee.

"A $10 million campaign trying to convince the public we are doing great things without actually doing them will only further damage the Forest Service image," the employee said.

Said another employee, "It’s a shame we have to rely on people outside the Forest Service to tell us what we are."

But others employees said they’d lost sight of the Forest Service’s mission, suggesting the need for an agencywide identity check.

Until the 1980s, the Forest Service was seen primarily as a timber-cutting agency, carrying out a mission defined by Congress in 1897 to secure "favorable conditions of water flows, and to furnish a continuous supply of timber," while protecting forests.

But as public attitudes toward clearcutting changed and wildlife including the northern spotted owl and salmon gained protection under the Endangered Species Act, the agency shifted its focus toward conservation and recreation. The Clinton administration in 2001 barred logging or roads on roughly one-third of the agency’s land.

The agency in 1987 sold a record 12.7 billion board feet of timber, but in 2013 it sold 2.6 billion board feet, in part because even relatively noncontroversial timber sales are challenged in federal court.

At the same time, overstocked forests, droughts and increased residential development have sent wildfire fighting costs through the roof. The Forest Service’s firefighting budget increased from 16 percent of its budget in 1995 to 42 percent today, forcing cuts in other budget areas and earning the agency the nickname the "Fire Service."

"By all appearances, we have lost our identity, and are groping blindly in the dark for anyone who can tell us what we stand for now," said one employee.

Hank Kashdan, a 37-year Forest Service employee who retired four years ago as associate chief, said that despite the "unfortunate wording" of the agency’s branding proposal, it was "probably a fairly worthwhile effort." Much of the blowback appeared based on the misconception that the Forest Service would spend the full $10 million, when in fact it would have maintained discretion to spend much less, he said.

"So many people view the Forest Service as only about fighting fire," Kashdan said. "Some think it is fire and cutting trees. Some think it is fire and preserving lands. This contract really seeks to figure out how communities understand [the agency] and how the agency can better represent the multiple-use mission the agency is all about."

A 2013 internal agency survey found that barely half of agency employees think the Forest Service is accomplishing its mission (Greenwire, Sept. 25, 2013).

Efforts to "unify diverse sectors around a shared appreciation of the agency mission," as outlined in the Forest Service’s branding call, may be money well spent, said John Palguta, vice president at the Partnership for Public Service, a nonprofit aimed at improving government jobs.

"I don’t think it’s silly at all for the Forest Service to want people to have a better understanding of what they do and why they do it," he said.

Public understanding can lead to greater public support, which can lead to more robust budgets from Congress, Palguta said.

Employees must also have a "clear line of sight" that connects their work to the agency’s broader mission, he said. "One thing any organization can do is make sure there’s good internal branding," he said.

Other federal agencies have rebranded to stay relevant to the American public, Palguta said.

Just last month, the Government Printing Office got Congress to change its name to the Government Publishing Office to better reflect its increasingly digital portfolio, he said. The Government Accounting Office in 2004 became the Government Accountability Office, in part to shake the perception that its employees were "the green eye shade people," Palguta said.

"There’s good internal branding," he said of GAO. "They take to heart that they’re making government more efficient for the American public."

While it’s not unreasonable for federal employees to grumble about the cost of a branding and PR contract, particularly when budgets are tight, Palguta said $10 million spread over five years is a relatively small percentage of the Forest Service’s roughly $5 billion annual budget.

There are similar grumblings about investing in information technology, he said. But while the upfront costs can be steep, long-term efficiencies can pay dividends, Palguta said.

"The reality is good management is looking out for the strategic long-term well-being of the organization," he said. "We need to invest now to prevent problems down the road."

Is China’s economy about to crash?

If you’re in the oil and coal business, the answer to that question is critical calculus for investment. Will demand for energy commodities be there?

Conventional wisdom inside energy industry boardrooms says yes. To Exxon Mobil Corp. and coal giant Peabody Energy Corp., China’s economy continues to soar, just at a slower rate, and a middle class is expanding there and in India. It’s widely assumed that population growth will fuel energy demand.

"The global middle class is expected to climb from about 2 billion in 2010 to almost 5 billion people by 2030, representing more than half of the world’s population," Exxon declared in its latest "Outlook for Energy," citing Brookings Institution research. "That middle class expansion — largely in India and China — will be the largest in history and will have a profound impact on energy demand."

At a recent event in Houston, John Hofmeister, founder of the group Citizens for Affordable Energy and former president of Shell Oil Co., repeated this consensus view, expressing confidence that crude oil demand globally will continue to rise at a strong pace for some time.

"Global demand is incessantly headed toward 100 million barrels per day," Hofmeister said.

He characterized the current oil price slump as a "refreshing opportunity" for the world to find a rational equilibrium that absorbs rising demand while holding the oil price at under $100 a barrel. The global oil price has plunged nearly 50 percent since June, as producers pump more oil into a slowing market.

February contracts for Brent crude oil traded under $53 a barrel yesterday, and U.S. West Texas Intermediate hit $50 a barrel.

Skeptics look at today’s collapsing oil prices and see the start of a long bear market. Fears are rising that a sharp slowdown in China’s economic growth, or an economic crisis there, could cement the declining oil price.

The gloomier version of the future espoused by some top economists does not assume emerging economies will continue growing rapidly. They say China isn’t immune from the kind of cyclical economic malaise and sharp declines that have plagued the United States, Japan and Europe for a century. In their telling, there are accumulating signs that China and India are entering tough times.

"Structurally, China has a fundamental economic problem, which is that its economy is overwhelmingly dependent on exports rather than on domestic consumption," said New York University political science professor Bruce Bueno de Mesquita.

The end of 2014 brought alarm bells over conditions in China’s economy. China’s growth rate could come in at under 7 percent, some predict, and others are pointing to signs that growth since 2008 has been inflated and propped up by overspending on real estate and manufacturing capacity.

David Hoffman and Andrew Polk of the Conference Board, an economic consulting group, note in a recent report that the government is injecting more capital to achieve less economic growth. Not only is stimulus spending increasingly less effective, but productivity in China is slowing, they say, which shouldn’t be happening in a rapidly urbanizing country.

They theorize that powerful state-owned companies or companies with cozy ties to government authorities are squeezing out foreign competition. Fostering competitive enterprises is getting harder. And they worry that any reforms that could boost the economy and aid long-term commodities demand are stymied by the resistance of influential insiders.

China’s stimulus spending in response to the 2008-09 global financial crisis "bore within its successes the seeds of potential crises caused by the distortionary impact of the State’s role in the economy," their report states. "Put simply, it bore the potential for a deceleration at least as rapid as its acceleration."

Political theorist Bueno de Mesquita has modeled China’s political and economic future using game-theory-based modeling methods outlined in his books "The Predictioneer’s Game" and "The Dictator’s Handbook." In an interview, he argued that the extremely unequal distribution of wealth in China will lead to rising political tensions, which could be exacerbated by an economic and financial crisis of the sort other rising Asian nations have faced in the past.

"If the economic crisis stops being a crisis and becomes a long-term malaise coupled with this uneven growth in different parts of the country, that eventually could reach a tipping point, and I think it will," he said.

The Conference Board report made headlines because it predicted a "long soft fall," in which Chinese economic growth would drop from about 7.5 percent today to 4 percent by the end of the decade.

India might be farther along this trend line. Economic reports say India’s gross domestic product growth for 2014 will register closer to 5 percent, down from more than 8 to 10 percent a few years ago. Manufacturing output in India has fallen even lower.

For China’s economy, there are plenty of red flags, aside from the famous "ghost cities" phenomenon, the subject of multiple news reports showing miles of empty apartment buildings and shopping malls, built so that local officials could showcase growth to Beijing and their regional government.

Imports are falling. Factories are reportedly producing surplus goods, with stockpiles of unsold materials rising. Debt has exploded since 2008, though the debt-to-GDP ratio for China’s federal government is viewed as modest. There’s also growing concern that China’s wealthy are leading an accelerating trend of capital flight from the country, with theorists pointing to Chinese interest in foreign real estate as one indicator.

Meanwhile, outside Asia, worries over the economic well-being of the developed world were outlined by contributors to an e-book published by the London-based Centre for Economic Policy Research, titled "Secular Stagnation: Facts, Causes and Cures." The debate in economic circles over "secular stagnation," or persistent low demand, was inspired by a now-famous November 2013 speech by former Secretary of the Treasury Lawrence Summers before the International Monetary Fund (IMF).

Secular stagnation "provides a possible explanation for the dismal pace of recovery in the industrial world, and also for the emergence of financial stability problems as an increasingly salient concern," Summers writes in his contribution to the book. The argument holds that the economies of Japan, Europe and the United States are so weak structurally, and that demand is so low, that even 0 percent interest rates are not enough to spur new investment and new growth, which would boost energy demand.

Summers’ launching of the secular stagnation debate was preceded by a paper he and fellow Harvard University scholar Lant Pritchett published predicting that both India’s and China’s economies will experience rapid drops in GDP growth, and not a "soft landing" as many believe. "Hitching the cart of the future global economy to the horse of the Asian giants carries substantial risks," they wrote.

Pritchett and Summers’ points have recent historical precedent. In the early 1990s, Indonesia, Malaysia and Thailand were the "Asian tigers" posting 8 to 9 percent annual economic growth or higher, according to World Bank data, and were viewed as poised to join Japan and South Korea in the ranks of high-income nations. Then, growth rates abruptly slowed right up until the 1997 Asian financial crisis.

For the Organization for Economic Cooperation and Development (OECD) nations, the energy industry is already expecting energy demand to grow only slowly or remain stagnant in much of the European Union, Japan and United States for decades to come. But some fear the stagnation will be even deeper than the industry is predicting, and at least one prominent economist fears that Japan’s and the E.U.’s current economic malaise — slow to no growth — could be in store for the United States.

Recent data fly in the face of this dim view. The latest figures posted by the U.S. Bureau of Labor Statistics show unemployment is steadily falling and incomes are possibly on track to rise again.

Northwestern University economist Robert Gordon still sees worry over the future of the long-term U.S. economy, arguing that "headwinds" and secular stagnation will conspire to drag down growth, and that any economic growth the United States experiences could be driven almost entirely by immigration. In the Centre for Economic Policy Research book, Gordon writes that he’s troubled by the fact that the U.S. economy has managed only 2 percent annual growth over the past four years, even as unemployment dropped from nearly 10 percent during the financial crisis to less than 6 percent.

Gordon predicts that slow U.S. growth will continue for the next 25 to 40 years. Even so, much of the oil industry already sees fuel economy standards for cars and other forms of efficiency putting the brakes on U.S. energy consumption.

"U.S. potential real GDP over the next few years will grow at only 1.4 to 1.6 percent per year, a much slower rate than is built into current U.S. government economic and budget projections," Gordon says.

Gordon points to the aging U.S. population and retiring baby boom generation; poor education outcomes and record student debt loads, exacerbating income inequality; and rising government indebtedness that restrains the government’s ability to inject new economic stimulus into the system. In a separate paper Gordon wrote for the National Bureau of Economic Research, he adds that the U.S. health care system also strains growth. The expectation that employers provide health insurance will discourage full-time employment and repel potential foreign direct investment.

John Kingston, a senior writer at the commodities pricing and information hub Platts, recently pointed to weak U.S. oil demand, even as a recovery is supposedly taking hold. Demand for refined products fell 200,000 barrels per day in September compared to a year ago, and U.S. consumers were using only 190,000 barrels per day more than they were three years ago.

"The increase in U.S. demand while its economy slowly grows is stunning in just how puny it is," Kingston wrote. "This sort of anemic growth, seemingly divorced from the state of an inconsistent yet clearly growing economy, is the great understated factor in the collapse of the price of oil."

It’s not at all clear that shifting global demographics change this equation.

Deutsche Bank global strategist Sanjeev Sanyal has argued that the world’s population was on track to expand much more slowly than official United Nations projections suggest.

The U.N. believes global population may expand to as high as 9.6 billion by 2050 and as high as 10.9 billion by 2100. Exxon’s outlook predicts a world population of 9 billion by 2040.

Sanyal argues that world population is growing far more slowly, and will start to decline by midcentury. By 2055, the population may grow to 8.7 billion, he predicts, but then fall again to 8 billion by 2100. He says the U.N. is ignoring the effect urbanization will have on encouraging even lower birth rates, pointing to steep declines in fertility in developed and developing nations alike.

Demographic forecasts also predict China’s society will age more quickly, and the workforce there may start to shrink, even as China’s overall population grows.

Still, economic growth could remain steady or even rise in many large countries, aided by the recent plunge in crude oil prices. Just as abundant and inexpensive natural gas has revitalized many sectors of the U.S. economy, optimistic economists predict the world benefits from cheaper oil.

The IMF and World Bank expect lower oil prices will spur more GDP growth and, eventually, greater energy demand. In a recently published white paper, the Economist Intelligence Unit makes this case, arguing that weaker growth seen recently in India, Brazil, Turkey and other large emerging economies was partly caused by inflation linked to high oil prices.

"The winners would be many of those that have over the past year been making the wrong headlines," notes the economist group. "The inevitable easing of oil import costs, and the ensuing improvement in their terms of trade, will provide a much-needed fillip to their vulnerable currencies, with India and Indonesia … especially well-placed to benefit."

Optimism among energy industry insiders and analysts about the role of fossil fuels in the coming decades tends to put natural gas at the forefront. Gas turbines replace some coal-fired electricity generation in a world beset by the effects of climate change.

"It is increasingly likely that key parts of the world — ranging from China to the United States — will put in place increasingly stringent public policies over the coming decades to reduce their emissions of greenhouse gases, including carbon dioxide," said Harvard University business and government professor Robert Stavins in an email exchange.

Jeff Moore, an energy analyst with Bentek, also sees a promising future for gas, with a nod to investments in liquefied natural gas export projects in the United States, rising interest in LNG in Europe and Asia, and a massive buildup of petrochemical production.

"We see plenty of fundamental support for prices at the end of the decade due to incremental demand growth from the shift away from coal to natural gas and the introduction of exports in the form of LNG," Moore said.

But gas producers will have to wait a couple more years before they may see any tangible benefits from this trend, Moore predicts. "Bentek doesn’t see the big demand response kicking in until the 2017-2018 time frame, and demand is expected to really ramp up through 2020."

Chinese solar manufacturers whose products have been subject to stiff U.S. tariffs for two years could see those penalties reduced by nearly half this spring after the Commerce Department found the degree of illegal dumping by Chinese firms between 2012 and 2013 was lower than previously estimated.

The preliminary findings, revealed in a Wednesday memorandum between Commerce officials, show that between May 25, 2012, and Nov. 30, 2013, actual dumping margins by leading Chinese manufacturers selling products into the U.S. market were less than 2 percent, significantly lower than what U.S. officials previously estimated.

As a result of the investigation, Commerce officials are recommending a revised anti-dumping tariff of 1.82 percent for most Chinese manufactures, while countervailing duties would remain roughly the same, at 15.86 percent. That compares with the current combined duties of roughly 31 percent for most Chinese manufacturers.

The revised tariff schedule would take effect later this year pending a final determination by senior Obama administration officials, according to the Commerce memo.

Dumping, which is illegal under international trade rules, involves the selling of goods or products into foreign markets at levels below their cost to produce to gain a market advantage over other suppliers, including those from the host country.

A coalition of U.S. solar firms, led by SolarWorld Industries America of Oregon, have aggressively pursued trade remedies to correct what they characterize as flagrant violations of trade laws by Chinese solar firms and the Chinese government, which they say have conspired to flood foreign markets with below-cost solar equipment and eliminate competitors in the process.

In 2012, the Commerce Department determined that Chinese firms were engaged in widespread dumping and were benefiting from illegal subsidies from Chinese government ministries, leading to the imposition of both countervailing and anti-dumping duties ranging from 24 to 25 percent.

A second round of duties, authorized by Commerce late last year and awaiting final approval from the ITC, will apply independently to Chinese and some Taiwanese firms that SolarWorld argued had circumvented the 2012 tariffs by outsourcing some parts of their solar manufacturing to other countries (ClimateWire, Dec. 17, 2014).

The new preliminary findings pertain only to the first round of tariffs imposed on solar cells and panels produced fully in China. Nevertheless, if upheld after a 120-day review, the lowering of the 2012 tariffs would sharpen Chinese competition and potentially drive down prices for U.S. buyers of Chinese solar panels, experts say.

"If you assume that the final [determination] looks similar to the preliminary one, it should make a big difference, especially when you consider the lower rates would apply to 20 or so companies that make most of the cells and modules coming into the United States from China," said Shayle Kann, a senior vice president and solar analyst at GTM Research in Boston.

Reactions to the possible tariff relief for Chinese manufacturers came quickly from both supporters and critics of U.S. sanctions.

Mukesh Dulani, president of SolarWorld Americas, said in a statement that Commerce’s preliminary findings "do not reflect the actual amount of dumping by Chinese producers," especially since the department opted to remove one of China’s largest manufacturers and a primary respondent in the 2012 trade case, Wuxi Suntech Power Company Ltd., from the list of firms receiving specific anti-dumping duty rates.

"By taking Suntech out of the calculations, the Commerce Department has allowed other Chinese producers to obtain an artificially lowered antidumping rate," Dulani said.

In comments yesterday, open market advocacy groups such as the Coalition for Affordable Solar Energy welcomed the findings from Commerce’s administrative review, saying the reduction in duties would correct a currently skewed solar market and stimulate solar development in the United States.

Jigar Shah, CASE’s president, called the proposed lower tariff rates "a step in the right direction for the U.S. solar industry," adding that the reduction in duties "means more American consumers will be able to afford solar power and more American solar companies will be able to expand their hiring."

Still, Shah added, the proposed measures do not remove all tariffs on Chinese imports, nor do they affect firms subject to the latest trade sanctions approved by the Commerce Department last month.

The new duties, applying both to leading Chinese and Taiwanese solar firms, will range from 11 to 78 percent.

California’s landmark cap-and-trade program to limit carbon emissions just got bigger. Effective Jan. 1 it expanded to wrap in gasoline and diesel, a move oil companies have warned would trigger higher pump prices.

Fuel distributors now must buy and submit permits covering greenhouse gas pollution tied to the fuels they sell. For the entire Golden State, that means 17 billion gallons annually. Oil-related businesses and their allies for the past year sought to stop the move, but failed to persuade the Legislature or Gov. Jerry Brown (D) to intervene.

Meanwhile, gas prices — the cornerstone of the debate — have tumbled.

Even as motor fuels fell under cap and trade’s mandates, gas prices on a statewide basis edged down. The average price yesterday was $2.65 per gallon, compared with $2.66 per gallon a week earlier, based on AAA’s Daily Fuel Gauge Report. The federal Energy Information Administration listed the price at $2.66 per gallon for all areas of the West Coast with reformulated gasoline. That was down from $2.67 last week. EIA does not release figures for just California.

Crude oil prices also fell yesterday. Brent crude closed at $53.11 per barrel, the lowest price since 2009. That will result in lower gas prices over the next six to eight weeks, said Tim Hess, an EIA analyst. Every $10-per-barrel drop in crude typically leads to a 24-cent-per-gallon decline in the price of gas, Hess said.

"The fact that oil prices are so low right now makes all this a much less big deal," Lucas Davis, an associate professor at the University of California, Berkeley’s Haas School of Business, said about cap and trade. "If anything, people are going to be spending less this year on gasoline and diesel."

Oil distributors argue that the lower prices might be a temporary respite. A state analysis last summer said that cap and trade would increase pump prices 10 to 12 cents per gallon, based on the current auction allowance price of $12 per carbon ton.

"My sense is that this is going to creep up over the next month as invoices are passed through," said Jay McKeeman, vice president of government relations and communications at the California Independent Oil Marketers Association (CIOMA). He conceded, however, that "if crude prices are going down and they continue to drop pretty rapidly, it kind of negates things out in terms of pricing."

"Pricing’s a black box," McKeeman added. "You’re never sure what components each individual supplier is putting in. Our simple message is this is a cost that is ultimately going to affect the price of fuel in California. People just need to be aware."

Dave Hackett, a member of a Petroleum Market Advisory Committee that California created last year to look at gas price fluctuations, said that California’s retail market is competitive enough that gas station owners might not pass through cap-and-trade costs, particularly in the current climate. Falling gasoline prices mean higher profit margins for retailers, he said, because the retail price generally moves more slowly than the wholesale price on the way down.

"If costs went up by a dime, I don’t know they’d pass on those costs right away," said Hackett, who also is president of oil industry advisory firm Stillwater Associates. He added that retailers likely would say, "I’m making plenty of dough. I’m not going to go up a dime; I’m just going to go up 5 cents."

Cap and trade’s expansion to include motor fuels takes place as Brown made clear that he supports further action to address climate change. The governor yesterday in his inaugural address said that he wants the state to cut petroleum use in half by 2030. He said that and other steps are needed to prevent catastrophic warming (E&ENews PM, Jan. 5).

"Taking significant amounts of carbon out of our economy without harming its vibrancy is exactly the sort of challenge at which California excels," Brown said. "This is exciting, it is bold, and it is absolutely necessary if we are to have any chance of stopping potentially catastrophic changes to our climate system."

Catherine Reheis-Boyd, president of oil trade group Western States Petroleum Association responded on Twitter that according to California Energy Commission data, "96% of CA transportation fuel [is] derived from petroleum. Reducing 50% will require great deal of involvement from all Californians."

Four oil companies, including Valero Energy Corp. and Tesoro Corp., have stated that they intend to include the cost of cap-and-trade allowances in invoices they give to distributors, McKeeman said. Those companies in turn sell gas to stations. The exception is oil companies that deliver directly to stations under their brand.

Fuel distributors will need to submit allowances for carbon emissions linked to their sales by November of 2016. They’ve been able to buy permits since cap-and-trade auctions started in November 2012.

CIOMA is no longer lobbying for legislation to keep fuels out of cap and trade, McKeeman said, having lost a quest to get a bill passed last year. He said the new push will be on information. CIOMA has signed an agreement with the Oil Price Information Service, or OPIS, to provide daily updates on how carbon fees affect gas prices in California.

"Sometimes you win. Sometimes you lose. Sometimes you just educate people," McKeeman said.

Davis, the University of California professor, argued that for fuel use to drop, taxes on gasoline and other fuels need to rise more than 10 cents. They should be about 30 cents per gallon, he said, to account for the environmental damage caused by the burning of oil products. Carbon pollution from transportation accounts for 38 percent of the state’s greenhouse gas pollution. Cap and trade isn’t technically considered a tax, though oil industry opponents of including fuels under the program and others have called it a "carbon tax."

"People would drive less, and they would drive smaller cars," Davis said. Hiking taxes by that much would reduce traffic congestion, carbon emissions and accidents, he added. He rejected that it would hurt the economy.

The taxes would be needed revenue, Davis said. They could be used to fund road and bridge repairs, or to offset taxes on income. By law, revenue from cap and trade cannot be used for roads and bridges.

While raising gas taxes traditionally has been viewed as a political third rail, he said, "views change over time. I think things are going to come around on this, particularly when it’s paired with need for revenue."

The state’s new Petroleum Market Advisory Committee has had one meeting so far. It is composed of longtime energy market economists, an oil industry consultant and an antitrust expert in the California attorney general’s office.

Professor James Sweeney, the committee chairman, an economist who directs Stanford University’s Precourt Energy Efficiency Center, said the group would examine state and proprietary data on wholesale and retail prices from before and after cap and trade takes effect. He has estimated that retail prices should rise about 9 to 10 cents per gallon.

Any price increase related to cap and trade would likely be introduced by the refiners into the price that gas stations pay, Sweeney said. "That’s where I think you’d see it," he said.

Sweeney said he is confident that any price changes would be apparent. "There’s been a long period of being able to watch the retail price dynamics, and so we have some expectation of what we should see," he said. "It’s early in the game, and you have a committee of five people who are very professional who I think will be able to look very objectively at what’s going on and call a spade a spade if we see one."

That said, Sweeney said he couldn’t recall any previous instance of collusion or other nefarious intent by oil companies to raise prices in California.

"In major cities and major urban areas … I can’t think of any [instance] offhand where there’s prices that are very different from what you can explain by those competitive forces," he said. "Every time we’ve had a price jump, or almost every time, the attorney general’s office has investigated this in California. I note that they’ve never come out with any indictment or anything that argued that there was any gaming going on."

In addition to cap and trade, he noted, several other significant trends and policies may be having an effect on gasoline prices.

The state’s low-carbon fuel standard, in place since 2009, requires fuel producers and importers to reduce the carbon content of their offerings by 10 percent by 2020 or to buy credits in a state-created market (ClimateWire, Jan. 5). Like cap and trade, that policy would be expected to raise prices as producers either resort to more-expensive fuels or buy credits, which have been selling for about $26 per ton.

On the other side, California’s vehicle efficiency standards, in place since 2009, as well, have reduced demand for fuels.

"It’s important to recognize there’s three regulatory interventions in the gasoline markets that are important for the state," Sweeney said. "As a committee, we can’t ignore those. But the cap and trade had the potential for leading to a discontinuity, and you had all the rhetoric about expecting a discontinuity."

Correction: An earlier version of this story misstated the amount of fuel motorists use in California.