Who we are

At Giving Green, we use an effective altruism-informed approach to recommend the best giving opportunities for fighting climate change.

Why we’re posting

  • To clarify differences in strategy – There are two primary climate change charity recommenders in the effective altruism community: Giving Green and Founders Pledge. We would like to explain (in our opinion) where our approaches overlap and where they diverge to demonstrate our respective strengths.
  • To encourage discussion and sharpen our thinking – We hope that our writing here will lead to feedback on our work, which we may use to update our approach. Ultimately, we believe that both our organizations are filling essential niches within the EA climate space.

We would like to thank Johannes Ackva and Matt Lerner at Founders Pledge for comments and clarifications on our initial draft.

Giving Green’s approach to recommending climate organizations

Giving Green’s priority areas

At Giving Green, we measure impact in terms of reduced levels of greenhouse gases (GHGs) in the atmosphere and seek opportunities that are highly impactful at the margin. To that end, we believe that the most impactful organizations are working to enact systemic policy change. As part of our philanthropic strategy, we support the following priority areas:

  • Policy advocacy for emissions reduction – Policy organizations can apply pressure on policymakers to implement legislation, executive orders, and/or regulations designed to drive down emissions. This pressure can be highly impactful in influencing policy scope and government funding.
  • Technology innovation – Increased funding for research and development (R&D) of neglected technologies (e.g., nuclear energy and direct air capture) and support for their deployment can potentially improve their capabilities and reduce costs in the future. If successful, this could improve their ability to scale and lower levels of GHGs in the atmosphere over the long run. Additionally, benefits from technology innovation are not limited by country borders. Namely, innovation can influence technological change in other countries (technological diffusion) and lead to global GHG reductions. Note that there is considerable overlap with policy advocacy, as we believe that policy advocacy can be a crucial lever to push technology forward.

Giving Green also guides non-philanthropic actors, such as businesses trying to meet net-zero goals and investors looking to help the climate. Our guidance includes research into carbon offsets and removals, impact investing, and Environmental, social and corporate governance (ESG) funds.

Where Giving Green works

At Giving Green, we believe there are potentially high-impact donation opportunities in many countries, and at the international and sub-national levels. We currently focus our policy efforts on the US and Australia and have developed recommendations for the two countries. We selected these specific countries for a few reasons:

  • US – The US is a global leader in R&D and contributes a significant amount to global CO2 emissions. As a small US-based team, starting with US policy played to our comparative advantage.
  • Australia – Australia is a top coal exporter, so pushing for more ambitious policy here is arguably a key piece in the global fight against climate change. Our decision to work on Australian policy is also influenced by donor preference, as a sizable Australian organization asked us to provide recommendations for the Australian market.

We plan on expanding our work to include organizations in other countries and subnational organizations.

Founders Pledge’s approach to recommending climate organizations

Founders Pledge’s theories of change

Founders Pledge focuses on minimizing climate damage as their primary outcome metric, as they believe that focusing on damage leads to different philanthropic choices than looking at emissions alone. It has selected several theories of change that it believes are most promising in causing high impact. Founders Pledge expects that its hypotheses will change over time; it has investigated other theories of change and will continue to do so.

  • Accelerating innovation in neglected technologies – According to Founders Pledge, there is more potential for climate damage in futures where mainstream methods for reducing emissions fail. Energy innovation may be a better bet than other approaches because its benefits are more robust to the situations that may arise in a high climate damage scenario (e.g., rapidly growing emerging economies, low willingness to pay for climate policy, and weak international coordination).
  • Avoiding carbon lock-in in emerging economies – Carbon lock-in refers to the tendency for fossil fuel-intensive systems to persist and prevent a transition to cleaner energy. If emerging economies successfully avoid carbon lock-in, they will likely experience a lower carbon emissions trajectory. This more downward trajectory is vital because most 21st-century emissions are expected to come from emerging economies.
  • Policy leadership and paradigm shaping – The diffusion of policy ideas from one country to another can have a multiplier effect on emissions reduction.
  • Growing promising organizations – By supporting promising organizations, Founders Pledge can likely help them increase their impact later. Additionally, the marginal impact of a dollar donated is probably higher for fledgling organizations rather than more established ones.

Where Founders Pledge works

Founders Pledge evaluates potential grantees worldwide. Although the vast majority of its grants so far have been to organizations based in wealthy countries, it considers them primarily based on their potential to reduce emissions worldwide, specifically in developing countries. Founders Pledge has investigated climate interventions that would reduce emissions in wealthy countries, but it has not yet found a charity in this space that meets its bar of "likely to be the highest impactful thing we can do at the margin given existing allocation of funding and potential of the strategy." Its reasons for this include the following:

  • There is already significant attention on wealthy countries According to Founders Pledge, which analyzed data on philanthropic foundations from ClimateWorks and large 2021 commitments from the Bezos Earth Fund and others, there is already significant funding allocated towards mainstream climate solutions in wealthy countries. On the other hand, emerging economies receive relatively more minor attention from climate philanthropy.
  • Founders Pledge believes that focusing on emissions from developing countries can lead to the most significant marginal changes to climate damage trajectories – Founders Pledge argues that emissions are decreasing in wealthy countries and are regulated in ways where work to reduce emissions is not necessarily additional. In contrast to rich countries, emerging economies are experiencing a rapid increase in emissions, and there is almost no binding climate policy in these countries.

These reasons do not rule out the possibility of Founders Pledge finding impactful opportunities in rich countries in the future. For example, two of Founders Pledge’s theories of change can be based in wealthy countries (i.e., climate policy leadership and paradigm shaping, avoiding carbon lock-in in emerging economies through finance). Additionally, Founders Pledge says its recommendations have already influenced millions in funding towards US-based causes. For example, some of the donations Founders Pledge has influenced outside of its own Climate Change Fund have gone towards the Clean Air Task Force’s (CATF) work on US-based regulations and clean energy standards because Founders Pledge recommends unrestricted donations.

Where our approaches overlap

Despite taking different lenses to climate philanthropy, Giving Green and Founders Pledge agree on many high-level conclusions:

  • Focus on systemic change – Giving Green and Founders Pledge believe that the most cost-effective approaches focus on systemic change instead of individual actions. We also both believe that the major levers of systemic change are policy and technology, which can be interrelated.
  • Emphasis on policy advocacy – We both believe that advocating for the government to spend money on a cause can result in high leverage and improved cost-effectiveness.
  • Support for technology innovations – We both think it is crucial to fund neglected technologies to drive emissions down. To that effect, we have both supported Carbon180 and CATF; Giving Green includes both organizations in our list of top charities, while Founders Pledge includes them in its Climate Change Fund.
  • Support for small growing organizations – We agree that supporting small growing organizations is where donors can frequently get the most use out of the marginal dollar.

Where our approaches diverge

Overview

Our thinking and approach differ from Founders Pledge in two key ways:

  1. At Giving Green, we believe that specific strategies for reducing emissions in wealthy countries can yield high cost-effectiveness and are competitive with those focusing only on emissions reductions in developing countries. Founders Pledge believes that strategies in rich countries can be reasonably cost-effective, especially compared to offsets, but is skeptical that they are close to the most cost-effective opportunities to reduce climate damage.
  2. In addition, Giving Green seeks to provide a broader range of donation opportunities to appeal to donors with different restrictions and preferences.

(1) and (2) together lead Giving Green to recommend best-in-class climate organizations in wealthy, high-emissions countries like the US and Australia.

Specific strategies for reducing emissions in wealthy countries can be highly cost-effective.

Founders Pledge’s grants in wealthy countries concentrate on organizations that advocate for technology innovation. In contrast, Giving Green recommends organizations that work on technology innovations (i.e., CATF and Carbon180) and organizations that work on domestic emissions reductions. For example, one of our 2021 recommendations is the US policy advocacy organization Evergreen Collaborative, which has worked chiefly on domestic energy policy. We take this expansive approach because we believe that specific, neglected strategies for reducing emissions in wealthy countries can be highly cost-effective. Below we outline why these strategies can be considered important, tractable, and neglected.

Important

We believe that reducing emissions in wealthy countries is vital for several reasons:

  • Emissions are decreasing in wealthy countries but not sharply enough.
  • Wealthy countries’ emissions reductions send a signal to other countries – We think it is likely that by having domestic policies that aggressively drive down emissions, rich countries can demand greater and faster action from other countries when negotiating international standards. Founders Pledge shares this argument but says that it has never seen a convincing case for this in action.

Ultimately, we believe it is unlikely that the status quo will lead to the deep decarbonization that we need.

Figure 1: Annual CO2 emissions between 1958 and 2019 in the United States and Australia

Tractable

Reducing emissions in wealthy countries remains tractable for several reasons (using the US as an example):

  • There are multiple avenues for influencing policy – Within the US, numerous policymakers have stood in the way of passing bold climate policy at multiple levels of government. Although tractability depends on the political context, savvy organizations will find their openings. For example, organizations can fight the climate battle at various levels of government and across different states. Policy wins can also occur through legislative, executive, and/or judicial branches.
  • Opportunities to effect change in the US will remain even after the 2022 midterm elections – Democrats will likely lose their government trifecta after the 2022 midterm elections. Although this would reduce Democrats’ ability to create new laws at the federal level, there will still be opportunities for change (e.g., bill implementation, policy development at the state and regional levels).
  • Money spent on policy development can ensure that the right policies are made and advocated for – It makes sense to fund small organizations that can develop innovative and impactful policies and know the political landscape well. Evergreen Collaborative, for example, is a small and agile policy organization whose plan is centered on fighting the climate crisis.

Neglected

We agree that the climate space in wealthy countries is not neglected as a whole, but there are still certain groups and strategies that are overlooked. More specifically, funding for mainstream climate solutions in wealthy countries has increased, but we see this as a weak proxy for assessing room for more funding. Namely, specific highly effective organizations do not command enough money and attention to match their potential. Evergreen Collaborative, for example, is probably an unfamiliar name to the average person and has significant room for more funding. 

Cost-effectiveness

We’ve conducted cost-effectiveness analyses for several organizations focused on US Policy and have found many of them to be very cost-effective. We calculate cost-effectiveness in terms of CO2-equivalent (CO2e) avoided/removed per dollar spent. Although we agree with Founders Pledge that climate damage is the ultimate outcome that matters, we believe that a focus on emissions provides a powerful proxy for climate damage and is, therefore, an appropriate outcome metric. 

  • Reducing emissions in the US can be highly cost-effective – We developed cost-effectiveness analysis models for organizations working on domestic policy such as Evergreen Collaborative, Rewiring America, the Sunrise Movement, and the Green New Deal Network. We found each organization to be probably highly cost-effective in reducing GHGs in the atmosphere. This cost-effectiveness is subject, of course, to heavy caveats on the inherent uncertainty of estimating cost-effectiveness for policy advocacy. The precise numbers should be considered rough estimates, and we think it’s appropriate to make comparisons only based on the order of magnitude. Our best estimates for their cost-effectiveness in reducing emissions (in expectation) are as follows:
    • Evergreen Collaborative – $0.54 per metric ton of CO2e
    • Rewiring America – $3.14 per metric ton of CO2e
    • The Sunrise Movement – $0.22 per metric ton of CO2e
    • Green New Deal Network – $0.73 per metric ton of CO2e
  • The cost-effectiveness of domestic policy organizations is comparable to that of technology innovation organizations – The cost-effectiveness of the domestic policy organizations that we investigated was comparable to that of Carbon180 and CATF. Estimates for their cost-effectiveness in reducing emissions (in expectation) are listed below. Note that we believe that our cost-effectiveness estimates for technology innovation are less certain than the above estimates for short-term emission reduction policy since the long-term impacts of new technologies are less certain and not included in the model.
    • Carbon180 – $0.66 per metric ton of CO2e
    • CATF – Using a conservative and backward-looking back-of-the-envelope calculation, Founders Pledge estimates that CATF’s work on passing the 45Q tax credits for carbon sequestration reduces CO2e at the cost of $0.11 per metric ton in expectation. Founders Pledge estimates that CATF’s work in the US removes CO2e at roughly $0.30 per metric ton in expectation. (Giving Green is currently undertaking our own CEA for CATF.)

In conclusion, although Giving Green agrees with Founders Pledge that preventing increased emissions in developing countries should be a philanthropic priority, we believe there are opportunities in wealthy countries with comparable cost-effectiveness. This belief, combined with our strategy of providing a more comprehensive range of donation opportunities (described below), leads us to continue searching for high-impact opportunities in wealthy countries. 

We provide a broader range of donation opportunities to appeal to donors with different restrictions and preferences.

At Giving Green, we believe we can optimize our impact by providing recommendations for donors who may have different giving preferences than the typical EA. Therefore, we cast a wider net than Founders Pledge to include people who want to, for example, prioritize local giving in their own country. We expect this to increase the amount of funding towards domestic causes that are highly effective at the margin instead of well-known environmental organizations, which are probably already well-funded.

There is some risk that our broad approach may displace funds from organizations with the absolute highest level of cost-effectiveness. However, we firmly believe that our approach allows us to increase our range of influence without meaningfully cannibalizing our “top” recommendations. For example, we take into account the following types of preferences: 

  • Desire for domestic policy advocacy – Many donors are not interested in giving to policy advocacy organizations outside their own country. This preference can be due to personal interest, such as a desire to make a tax-deductible donation. Therefore Giving Green offers country-specific recommendations.
  • Preference for carbon offsets – Businesses and organizations with net-zero goals are generally unwilling or unable to donate to places that focus on policy advocacy but may be interested in carbon offsets instead.
  • Investment vs. donations – Many people would like to influence the climate through investments rather than philanthropic contributions. Giving Green has a new research workstream to guide pro-climate investments.

Influencing donors with these preferences could increase emissions reduction relative to a counterfactual where they either (1) donate to less effective organizations or (2) not at all.

Please note that although we cast a wider net to capture more potential donors, we do not select charities for reasons of organizational variety. For example, our 2021 US recommendations did not include any activist groups, even though we investigated the impact and cost-effectiveness of progressive US-based activism this past year. Additionally, we have tried to limit the risk of funding displacement by making it clear on our website that policy organizations are more impactful than carbon offsets.

Conclusion

Giving Green and Founders Pledge both recommend the best giving opportunities for fighting climate change. However, although their approaches overlap in some ways, they diverge in key ways, leading to some differences in final charity recommendations. Notably, Giving Green seeks to appeal to a more expansive donor pool (e.g., donors who have donation constraints). 

We welcome feedback from the EA community and are happy to discuss our ideas in the comments below or through email (givinggreen@idinsight.org).

Are you interested in supporting Giving Green?

As a nonprofit organization, Giving Green relies on donations from its readers. If you appreciate our research and would like to support our operations, you can donate to us here. Donations to Giving Green help us grow and support our research and communications.

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13 comments, sorted by Click to highlight new comments since: Today at 12:54 AM
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Thank you for laying out your thinking on how Giving Green (GG) and Founders Pledge (FP) think about the problem differently.

I've got several comments on the strategy, but I wanted to highlight one major instance where I think CATF is likely to cause more emissions than would otherwise be emitted. CATF is a top recommendation by Giving Green and Founders Pledge, and is the top recipient of Founders Pledge climate fund grants.

It concerns CATF's support for the 45Q tax credit as mentioned in the post:
"CATF – Using a conservative and backward-looking back-of-the-envelope calculation, Founders Pledge estimates that CATF’s work on passing the 45Q tax credits for carbon sequestration reduces CO2e at the cost of $0.11 per metric ton in expectation. Founders Pledge estimates that CATF’s work in the US removes CO2e at roughly $0.30 per metric ton in expectation. (Giving Green is currently undertaking our own CEA for CATF.)"

Some factual background:
- The 45Q tax credit provides a financial incentive for carbon capture and sequestration.  It is described by the congressional research service here: https://sgp.fas.org/crs/misc/IF11455.pdf.  Extension and expansion is part of the climate provisions in the Build Back Better bill that is currently stalled in congress.

- CATF is supportive of the use of 45Q for the power sector.  John Thompson is their team lead on this, and they've laid out their reasoning for why they support it in this report: https://www.catf.us/wp-content/uploads/2019/02/CATF_CCS_United_States_Power_Sector.pdf

- Founders Pledge agrees with the form and structure of this analysis, but does assume 50% less savings to be conservative: "Note that we are not taking this study at face value, we are assigning a 50% probability that 45Q has zero effect." (Founder's Pledge recent report, https://founderspledge.com/stories/changing-landscape, footnote 35 page 117).  They do not entertain the possibility that 45Q could increase emissions.

- Last year 45Q lobbying support was a substantial part of CATF's lobbying agenda:
https://www.opensecrets.org/federal-lobbying/clients/bills?cycle=2021&id=D000049290.  They were alone (as far as I can tell) among environmental groups lobbying to increase and extend the 45Q tax credit, joining a mix of coal, fossil fuel, and utility companies.  45Q was the primary lobbying objective of coal companies last cycle.

- CATF's lobbying efforts have been both to increase the size of the tax credit and to remove the requirement that a 45Q recipient must capture at least 75% of its carbon emissions to qualify https://www.eenews.net/articles/big-payout-more-co2-greens-split-over-dems-ccs-plan/.  CATF advocates for increasing the credit from ~$30/ton to ~$85/ton https://www.catf.us/2022/01/gao-report-highlights-importance-doe-carbon-capture-and-storage-demonstration-funding/.

- Coal CCS projects do not capture 100% of their carbon emissions.  The CATF report assumes 80% capture.  As noted above, the industry is seeking to qualify projects that capture any carbon, regardless of the percentage of emissions it represents.

- Captured CO2 is primarily sold for enhanced oil recovery.  To account for this increase in fossil production and monetary benefit to the CO2 producer, the 45Q gives a lower tax credit for EOR projects versus saline storage projects.

- The only currently operating coal CCS project has had equipment issues and is only capturing 44% of its targeted 90% capture rate https://www.eenews.net/articles/ccs-red-flag-worlds-sole-coal-project-hits-snag/.

- The U.S. does not have a successful coal CCS plant operating, but that is not without trying.  A bit over a decade ago, as part of the ARRA funding, the U.S. government gave $684 million to eight coal projects to build out coal CCS.  None of them succeeded, and the financial waste was so bad that the government accountability office wrote a report about it. https://www.canarymedia.com/articles/carbon-capture/us-government-squandered-hundreds-of-millions-on-clean-coal-pipedream.  John Thompson of CATF has responded to the GAO report defending the funding, saying that the ~$400 million that went to industrial projects was successful and that the 45Q tax credit should be increased to $85/ton to make coal CCS viable https://www.catf.us/2022/01/gao-report-highlights-importance-doe-carbon-capture-and-storage-demonstration-funding/.

Now the analysis:
If the competition for coal CCS were coal plants without CCS, then a tax credit would make sense to offset the cost of capture.  But this is not the case.  The primary competition for coal CCS is cheaper efficiency, wind, and solar.  They aren't just cheaper, they are much cheaper: new wind and solar costs are cheaper than the operating costs of existing coal plants: https://www.lazard.com/perspective/levelized-cost-of-energy-levelized-cost-of-storage-and-levelized-cost-of-hydrogen/.  This, along with cheap gas, has been the main driver of coal plant retirements in the U.S..

In this context, the 45Q tax credit, if large enough, is a financial lifeline to coal plants that keeps them from retiring sooner.  This is a key point made by Jeremy Fisher of the Sierra Club and others https://www.eenews.net/articles/big-payout-more-co2-greens-split-over-dems-ccs-plan/.  In this context, the appropriate comparison is between wind or solar at zero emissions and a coal plant at 20% emissions (comparable to gas), assuming it runs perfectly.
This was evidenced in a front-page article in the Washington Post today (18 Jan 2022) regarding the Coal Creek Power plant in North Dakota.
https://www.washingtonpost.com/climate-environment/2022/01/17/coal-creek-station-power-plant/.  The plant was going to retire and be replaced with wind, but the Republican government worked hard to keep the coal plant open.  The new developer plans to keep it running, calling "the several billion dollars in tax credits the federal government offers for carbon sequestration “essential” for making that happen.", despite having no experience with coal CCS, and no successful projects evidenced in the U.S.
I cannot emphasize enough how mindbogglingly stupid it is to keep a coal plant running instead of replacing it with wind in a region that has among the best wind quality resources in the world: https://windexchange.energy.gov/maps-data/77.

The CATF study supporting coal and gas CCS suggests that most projects are likely to occur in Texas, Oklahoma, Kansas, Missouri, and Arkansas, as these are among the only places that have a suitable geologic reservoir to sequester CO2.  Again, this part of the country has among the best wind resources in the world: https://www.eia.gov/energyexplained/wind/where-wind-power-is-harnessed.php.  The CATF study mentions that "carbon-controlled fossil generation does not displace generation from renewable sources," meaning a 45Q tax credit doesn't displace renewables, primarily because renewables are cheaper even with the tax credit support for coal.  They do not consider it the other way around - that without the tax credit,  renewables (namely wind) would completely obviate the need for any coal CCS by being cheaper.  This is baffling to me, and highlights that one of Founders Pledge's "conservative" assumptions is not conservative at all; a "conservative" assumption would be that 45Q prevents cheaper, zero-emission wind and solar generation from coming online and that support of 45Q in the U.S. is in fact negative emissions reductions per ton.

Founder's Pledge then goes on to estimate that 45Q will kick off a learning curve in coal CCS of ~10% cost reduction per year that can be applied globally.

A few things wrong with this:
First, learning curves do not apply to every technology. Solar PV is small and scalable, coal CCS is a mega infrastructure project.  Solar PV realizes its learning curves by having many dozens of plants from dozens of different manufacturers distributed globally cranking out hundreds of gigawatts per year.  Coal CCS has a few specialized mega engineering firms with many unique considerations per project doing 1 GW a decade so far.  Mega infrastructure projects do not have as good of learning curves as smaller, scalable tech.  Some technologies, like nuclear, have negative learning curves.  So Founder's Pledge again falsely assumes that their learning curve estimate is conservative: "Even if one assumes a modest learning rate of 10% per doubling of capacity – for reference, solar is approximately 30%, so this is a fairly conservative estimate" (FP report, p.117).  Relatedly, it's not clear that learning rates for large infrastructure projects in the U.S. are transferable to other parts of the globe, again because of the mega infrastructure nature of coal CCS and unique project characteristics depending on the geologic sink is paired with.

Secondly, and more importantly, the same market competition with renewables applies.  Coal CCS globally will need substantial government support to retrofit and operate coal plants at a price comparable to just replacing them with new renewables.  Founder's Pledge says that coal CCS may be critical in retrofitting coal plants that are "locked in", but again new renewables are cheaper.  RMI did a big report on that this year https://rmi.org/wp-content/uploads/2021/03/rmi_how_to_retire_early.pdf.  I broadly agree with RMI's arguments here, and I think their forecasting accuracy is better than most in the energy space.

Founder's Pledge main goal here is to fund technologies in case the main ones don't work out.  But in the case of coal CCS, two things must happen for that reality to pan out: 
1) governments are willing to spend vast sums of money to keep their coal industries alive by preventing renewables from replacing coal and 2) in that scenario they still care enough about climate that the are willing to pay even more to reduce emissions of the coal plants by like ~80% at best.  I don't think that is a plausible reality, and it also still entails substantial emissions.

Third, renewables are being installed at hundreds of GW annually and are quickly stranding coal and even gas plants globally.  Coal CCS, even if governments want to save their few thousand coal miner jobs at the cost of millions of dollars per job, are not going to be able to build coal CCS at a rate even within an order of magnitude of the present rate renewables are being installed.  Coal CCS projects are massive and take years to build.  I'd bet we will have a mostly decarbonized the power sector by the time we see even 20 GW of coal CCS built or retrofitted globally, if we ever do. (20 GW is ~1% of global coal capacity).

In summary, I think CATF's report on carbon reductions from coal CCS is irredeemably flawed.  Given that, CATF's support for expanding the 45Q tax credit and reducing it's capture requirements is unjustified and will likely increase emissions (see: North Dakota example).  Regardless the support is non-additional given the amount of lobbying dollars that are being spent to support it anyways by the fossil fuel industry and utilities.  If you find yourself the lone environmental group lobbying alongside Peabody, Arch coal, and FirstEnergy and against the Sierra Club (who has been THE leader in coal plant retirements with their Beyond Coal campaign), that should send a red flag that maybe you should reconsider your analysis.  Founder's Pledge compounds this error by making "conservative" assumptions that aren't actually conservative at all because they fail to red-team the structure of the analysis and entertain reasonable counterarguments.  And then they scale up the assumptions globally, assuming that what is learned doing mega infrastructure coal CCS in the U.S. is directly transferable anywhere. All while disregarding the reality that renewables are driving retirement of coal plants in the U.S., and out-competing coal for new generation globally.  Founder's Pledge would benefit by hiring someone with a different perspective to red-team their reports and catch these sort of mistakes.

My general advice from this is that if you do give to CATF, you should target your donation to just their Super Pollutants program.  Their coal CCS program is likely damaging.  Their other programs are likely neutral, but I'll save that comment/post for another day.

[EDIT: enabled links and fixed some typos]

Hi Matthew, thanks so much for the thoughtful reply. I'm sure the team at Founder's Pledge will have some comments on this, as they have gone a lot deeper into the model for 45Q, but I'll drop a few thoughts here. 

I think that a lot of your comments have validity, and underline why 45Q is controversial among environmental groups. In theory it could keep old coal plants alive, and could give old oil fields a new lease on live through EOR. 

Truthfully though, I don't think it's realistic that 45Q keeps a significant amount of coal plants alive. Like you mentioned, CCS for coal plants has never worked and I don't think many people realistically see it working anytime soon. The unit economics of coal are only getting worse, and CCS/45Q are not going to save them. 

The reason why CCS is an exciting technology is not for power plants (which, as you correctly note, can be much more efficiently replaced with carbon-free energy sources), but for use in the future for hard-to-abate sectors like heavy industry (concrete, chemicals, etc). Investments like 45Q are a means to an end- a way to incentive R+D in the hope that this becomes a viable technology down the road when we really need it. 

I see you have some skepticism on the learning curve estimates, which is quite reasonable. It's very hard to predict the speed of innovation, and I think smart people disagree on whether CCS will ever become viable at scale, and if so how long it will take.  Therefore we should all have really wide bounds on the cost-effectiveness estimates of something like 45Q, and yes there's probably some part of the distribution that is negative. 

But CCS is such an important potential  technology in the broad scheme of things, and I believe strongly that it is deserving of huge amounts of investment. 45Q is a politically feasible way to leverage government funds to do this. From my perspective, it is absolutely worth it to get this investment, even if it means in the short terms that a few oil fields hang on a little longer than they could have. The long-term payouts in expectation are just too large to ignore.  

Agree with Dan here. 

In addition: Coal might be dying in the US, but not yet globally (or at least not fast enough)  and CCS is also useful for gas w/CCS, blue hydrogen, and carbon removal, all of which could be/are definitely important so  there are plenty of reasons to be excited about 45Q even at the risk of marginal emissions increases in some edge cases.
 

I don't know how to contextualize your statement that 45Q is worth supporting "even at risk of marginal emissions increases in some edge cases" given your own report.  CATF's report "Carbon Capture & Storage in The United States Power Sector" which only considers coal and gas power production CCS was a primary input to your cost-effectiveness model of CCS globally (page 117 and footnote 35 of your Nov 21 report "A guide to the changing landscape of high-impact climate philanthropy").  I don't see how this is either a "marginal emissions increase" or "edge case" when it was the primary justification for CATF to support 45Q at the $85/ton level.  Have you significantly changed your cost-effectiveness model for CCS since you released your report in November?

We can have some nuance about 45Q here.  Why not just say to CATF "lobby for only industrial CCS, keep the level at $30-$40/ton, and don't lobby to remove the 75% capture requirement"?

Quick calculation here:
emission rates per kWh: https://www.eia.gov/tools/faqs/faq.php?id=74&t=11
(1 kg CO2 per kWh) * (0.8 capture rate) * ($85/1000 kg sequestered) = $0.068 / kWh.  That's a big enough generation subsidy that it could keep some coal plants operational.  And there are plants that are explicitly using this reasoning to justify to regulators that they should stay open.

CATF could have lobbied to have the tax credit apply only to industrial facilities, or that the credit amount should be lower - more like $30-40/ton.  But CATF targets $85/ton partly because they think that is the threshold necessary to make CCS projects for fossil fuel electricity production viable: https://www.catf.us/2022/01/gao-report-highlights-importance-doe-carbon-capture-and-storage-demonstration-funding/
Founder's Pledge assumptions are primarily based on coal CCS and its impact on retrofitting locked-in coal power plants globally.

The risk exists for other sectors too - that the tax credit could be used to keep fossil incumbents operating longer with lower but far from zero emissions.  I do think it makes sense to have some carbon sequestration tax credit for certain industries.  If I were drafting 45Q, I would be careful to balance the sunset clause on the tax credit to be long enough to encourage projects in key industries, but short enough to remove it if it is crowding out true zero-emission alternatives on an industry-by-industry basis.  I also think we should be incredibly cautious and risk averse doing lobbying work in this space because of the potential of lock-in effects and white-knighting the fossil fuel industry.  Unlikely other areas in the climate space, there is a clear and significant risk of doing damage here.

Also, I think "R&D" is thrown around too loosely.  The conventional, common definition of R&D that DOE and academia uses refers to technologies on a 1-9 technology readiness level scale https://en.wikipedia.org/wiki/Technology_readiness_level.  Coal CCS is a mature technology, not on that scale, and there is an operating plant.  It's just enormously expensive and still has emissions.  I think what you and others are referring to when using the phrase R&D in this context is driving cost reductions through scaling and learning curves, not new technology (R&D).  This is generally referred to as deployment, not R&D.  Please do correct me if you think I'm misunderstanding and misrepresenting your terminology here.  In the context of scaling and learning curves, one does not do this with "the hope that this becomes a viable technology down the road when we really need it".  Learning curves and scaling require consistent and significant growth of a sector; you can't just do a bit of deployment, shelve the industry, and then come back and expect it to be at the same price point.  If we want to deploy CCS to be at scale and low cost, that requires a massive developing and growing industry.  In that context lobbying for 45Q one way or another is risky and path dependent, and I agree with you that the distribution has really wide bounds encompassing zero.  For coal CCS specifically, I think that distribution is nearly entirely negative and there are clear downsides (at least 20% of continued coal emissions) with small potential for an upside.  Why not just focus on industrial CCS only?  That removes a significant know risk and learning probably happens across a wider array of industries anyways.

Regardless of whether you think CCS is important or not, I don't see a case for why EAs should fund CATF doing advocacy in this space.  CCS is an existential lobbying priority of the fossil fuel industry which massively outspends most other industries and environmental groups.  45Q got extended and increased as pork for Manchin and republican support on BBB and the infrastructure bill.  Why is CATF necessary here?

Much has been already discussed, but I wanted to add some clarifications and additional arguments on some points.

  1. None of our grants was driven by the cost-effectiveness analysis that Matthew cites as justifying or being the basis of our grants.
  2. All money that FP and Giving Green direct to CATF are philanthropic dollars.
  3. Why philanthropic CCS support is valuable despite a powerful fossil lobby
  4. Learning curves of CCS

And, more generally, on uncertainty and the relative uncertainty of different interventions:

  1. Should we care about the degree of uncertainty?
  2. If we care about uncertainty, we need to look at the entire theory of change

 

FACTUAL CLARIFICATIONS

1. None of our grants was driven by the cost-effectiveness analysis that Matthew cites as justifying or being the basis of our grants. This is also clear from the report, as we (i) only include it in the background section, (ii) have plenty of qualifiers about this explaining a logic / theory of change (indeed, it is first referenced in a section on theory of change, irrespective of a specific grant, p. 86), (iii) the cost-effectiveness example is a historical case from 2018 and we have only started making grants from the Climate Fund in 2020, and (iv) the rationale for our grants, including for CATF, is also explained in the report. From the two grants we made to CATF from the Climate Fund, the first was to capitalize on the Biden moment across the entire spectrum of technologies CATF focuses on (CCS, but also hydrogen, advanced nuclear, geothermal, methane etc.) and the second was for globalization of CATF activity and organizational investment. 

As I emphasize whenever I talk or write about it, these cost-effectiveness analyses are clearly wrong and they (i) primarily serve as explaining a logic and important stylized facts (such as the stark difference between local and global effects) and (ii) they are not the only and certainly not the primary piece of analysis when making a grant – a lot of other kinds of evidence and considerations go into grantmaking. 

Indeed, because these cost-effectiveness analyses are ultimately so arbitrary at FP we now focus on understanding the source of impact differentials – analyzing the climate philanthropy and action landscape – rather than getting more precise with specific analyses, as impact differentials are more important to make the right prioritization decisions (again, more in the report and also the reason we do not publish lots of BOTEC cost-effectiveness analyses these days; lots more on this in the report).


2. All money that FP and Giving Green direct to CATF are philanthropic dollars, c(3), not c(4), so they are not part of the lobbying budgets and expenses discussed above.

 

ON CCS

3. Why philanthropic CCS support is valuable despite a powerful fossil lobby: 
2 gives part of the answer why CATF’s CCS work is valuable despite a powerful well-funded fossil fuel industry. Insofar as one accepts that CCS support is a bet we should take (Kim & Dan have elaborated on this so I won’t add detail here) from a climate angle, it does matter that there is one credible environmental org aligned with Democrats (there are also Republican climate orgs, like ClearPath) that pushes for it, it can make the difference between this being entirely dismissed as fossil fuel or Manchin demand to being an option that has support from clearly climate-motivated actors. CATF also has different incentives than fossil fuel lobbyists in shaping the legislation, so this is another positive aspect of CCS-philanthropic-funding that is not just lobbying expenditure.

4. Learning curves of CCS: 
The learning curve that we assume for CCS is 10% (based on an 8% conservative rate in a report by Global CCS institute, see report for details), compared to a learning curve of 25% or so one would use for solar. So we do indeed adjust for the fact that for a technology like CCS, large-scale not easily mass manufacturable infrastructure, the learning rate is much lower than for more modular technologies. 45Q supports a whole lot of different CCS applications – coal, gas, carbon removal etc – and it doesn’t seem particularly plausible that none of them will have significant technological progress because of a more ambitious 45Q (as discussed above, we do not specifically focus on coal CCS, indeed I am personally more optimistic on other forms of CCS). Within the CCS bucket, there are technologies with high modularity where indeed we should expect higher learning curves than for coal CCS.
 

ON UNCERTAINTY

5. Should we care about the degree of uncertainty? There’s a bit of a semantic stop-sign dynamic in some of the discussions of uncertainty here, suggesting that higher uncertainty would be a reason to be less enthusiastic, more skeptical etc, to use it as a disqualifier. But from an impact-maximizing perspective there isn’t really a case per se for treating uncertainty as an impact-reducing feature. There are, of course, interactions between uncertainties and how they are resolved which we discuss in our report, but these considerations are around the interactions of uncertainties, not the width of uncertainty.I think there is something like intuitive risk aversion going on, where uncertainty leads to skepticism (“maybe it will have zero effect”), whereas the positive case is mentally discounted. But for uncertain technological trajectories as well as ambitious policy changes, the upside can be extremely large.

 

6. If we care about uncertainty, we need to look at the entire theory of change: As discussed, I don’t think uncertainty should be a qualifier from an impact perspective. But regardless, statements like “innovation advocacy is more uncertain than interventions to deploy mature tech” are partial and, for this reason, possibly quite misleading. We all agree that the innovation process is more uncertain than the deployment of existing technology, but here are a couple of uncertainties that run the other way (which are more uncertain for deploying mature technology) that would need to be taken into account in an overall account of uncertainty of different philanthropic bets:

  1. Lower probability of policy success: policies to meaningfully affect the emissions trajectory in the short term will be larger, more restrictive, more expensive etc and, hence, have a higher risk of failure, certainly in the US federal context. The case in point is the CEPP, which had a low probability of passing (and which indeed did not pass) rendering Evergreen’s past impact ~nil, whereas there are multiple touchpoints every year to have a positive impact on innovation policy. 
  2. Lower probability of marginal impact of charity: Mature technologies have more clout in terms of special interest groups and political representation and these policies are often more politicized (a clean energy standard is more of a top-line item than additional innovation policy) so, prima facie, the probability seems lower and it seems more uncertain that a charity could have additional relevant impact.
  3. Lower probability of policy additionality: Short-term emissions reductions in wealthy OECD countries rarely have full additionality. In the US case, lots of state policies undermine the additionality of federal policy targeted at immediate emissions reductions. Had the CEPP been implemented for its emissions reductions to be fully additional it would have been necessary that ambitious states like California and New York strengthen their own targets in proportion to the additional emissions reductions from federal policy, rather than just reaching their own targets a bit more cheaply (in terms of their own budgets). And this does not yet account for states making their policies more ambitious in what they perceive as federal inaction. On the flipside, the benefits of technological innovation are global (with most jurisdictions with less strict targets and hence more policy additionality) and trajectory-shaping beyond the near future for which existing policy commitments are credible, so the policy additionality is much higher (also see our report for more).


So whether or not uncertainty of Rewiring America or Evergreen or CATF or Carbon180 is higher is very much an open question. It depends on how the entire sequence of uncertainties from (i) funding additionality (will this be funded anyway?) to (ii) activity additionality (will the funded activity happen anyway, if not by charity X then by someone else?), (iii) probability of policy change, (iv) naive emissions reductions from policy change and (v) emissions reductions adjusted for policy additionality plays out. We cannot just single out (iv) and assign it to the entire intervention and conclude that innovation advocacy is more uncertain than mature tech deployment just because one step in the theory of change of the former is more uncertain.









 

I find your estimate of Sunrise's cost-effectiveness of $0.22 per mtCO2e extremely implausible. Sunrise and its chapters have opposed essentially all of the most important policies for reducing emissions:

  • Carbon pricing
  • Nuclear power
  • Dense infill housing
  • Carbon capture

Your Sunrise deep dive does not discuss any of these issues.

Hi Max,

Thanks for your comment. We don’t currently recommend the Sunrise Movement (see prior post) but plan on evaluating them again this year. 

The decentralized nature of Sunrise has led to a lot of misunderstandings about its position on certain issues. Sunrise’s local hubs can autonomously make policy statements, but these don’t reflect the position of the central movement. In most cases, publicized opposition to certain technologies or policies has come from specific local hubs and doesn’t reflect Sunrise’s official stance on the issues. 

While the national organization has expressed opposition to carbon capture and carbon pricing in the past, their actions and other statements from staff reveal a more nuanced approach. We have not yet seen evidence that Sunrise meaningfully engages in opposition to the policies you name; e.g., it supported the passage of the bipartisan infrastructure bill, inclusive of nuclear and carbon capture investments. Members of Sunrise leadership have opposed the closing of existing nuclear power plants and have expressed a need for carbon capture under some circumstances, such as hard-to-decarbonize industries.

Decentralization is a choice that donors should consider. Sunrise funds empower local chapters that advocate counterproductive climate policies. Their choice also not to actively support critical policies like carbon pricing is also relevant, especially given studies showing that emphasizing less-effective climate policies reduces interest in more effective ones.

If they were the only grassroots climate org and they generated interest in broad climate action, it might be worth the trade-off. But interest in climate is strong and other organizations like Citizens' Climate Lobby advocate proven solutions (and are much more funding-constrained than Sunrise, even when Sunrise was smaller).

Have you researched Citizens' Climate Lobby? They're a grassroots organization advocating carbon fee-and-dividend policy, mostly in the US. All credible studies I've seen indicate that we cannot reach our climate goals without carbon pricing; for example, this study finds that a carbon tax starting at $15 per ton would more than double the emissions reductions of the Build Back Better Act.

Polls suggest that returning carbon tax revenue as a dividend increases its popularity, though carbon pricing polls strongly net-positive either way: about +36 net favorability since 2020.

polls

Research from myself and others also finds that a carbon dividend would substantially reduce poverty; this wouldn't be a major shift from an EA perspective in the US, but if the policy spills over to developing countries, it could meaningfully relieve suffering a la GiveDirectly.

Disclaimer: I've volunteered with Citizens' Climate Lobby since 2018 and am currently a volunteer chapter leader for them.

Hi Max, thanks for your comment. We quickly looked into CCL in 2020, and wrote up a "shallow dive" here.  While we support the carbon tax  push of CCL in theory, our assessment is that there is currently no clear pathway to passage of such a provision as it's not supported by either party. We therefore decided not to pursue further research  into CCL at that point, but are open to revisiting them in the future. 

I don't agree that a carbon pricing is the only way to reach our climate goals- my view is that reductions can alternatively be reached through regulations, and this is a more realistic path forward given political headwinds in the US. At least this seems to be the case for the foreseeable future. 

That report doesn't include CCL.

Democrats do support a carbon tax:

Every other developed country has priced carbon. Only Australia has revoked it. Taking an outside view, this suggests pricing carbon in the US is tractable; the absence of it will also create clearer trade tensions as the EU starts enforcing its border adjustment.

What studies find that regulations without carbon pricing can reach our climate goals? The only one I've seen is Rhodium (2021), which requires an unrealistic coordination of many unprecedented climate policies at the congressional, executive, state, and corporate levels (pp. 16-18). This policy suite far exceeds BBB and regulations from Obama and Biden, which are already on shaky ground given the Supreme Court's questioning the EPA's authority to regulate GHGs. That report also includes a more optimistic baseline than others, and still only gets to 45-51%. Many other reports, including from Rhodium, show that carbon pricing makes these goals straightforward to meet.

Sorry, looks like our write-up of CCL didn't make it into that document. Sorry for the wrong info. I'm going to stick with my opinion there there is no viable path towards carbon pricing in the near term in the US, and also that carbon pricing in practice has not been a very effective lever for reducing GHGs. I'd be happy to change my mind on either of these points in the future. I like this article as a nice argument to be skeptical on carbon prices: https://bostonreview.net/articles/leah-c-stokes-matto-mildenberger-tk/