Monday, April 13, 2015

2015: A Good Year for Reducing Carbon Emissions

By Nick Lawton, Staff Attorney

This year, the United States may achieve the most significant decline in carbon emissions in the nation’s history, according to a new white paper from Bloomberg New Energy Finance (BNEF), Medium-term Outlook for US Power: 2015 = Deepest De-Carbonization Ever. BNEF attributes the coming de-carbonization to three factors: the growth of renewable energy, the retirement of coal plants, and the replacement of coal with natural gas. This blog post argues that this year’s anticipated decline in carbon emissions is really part of a much greater, much more significant trend: The United States has begun the transition from fossil fuels to renewables.

Coal-To-Gas is Tepid Progress

BNEF is correct that closing coal plants and replacing them with natural gas facilities can lower emissions of carbon dioxide at the power plant level. For this reason, natural gas sometimes receives praise for being a “bridge fuel” that can ease a transition toward renewable energy. However, the natural gas “bridge” lacks a solid foundation for two essential reasons.

First, extracting and refining natural gas leads to “fugitive” methane emissions before natural gas ever reaches a power plant. Because methane is a much more potent greenhouse gas than carbon dioxide (25 times more powerful), these fugitive methane emissions can more than offset any reduced carbon emissions at the power-plant level. In fact, Robert Howarth, a scholar at Cornell University, found that “both shale gas and conventional natural gas have a larger [greenhouse gas footprint] than do coal or oil, for any possible use of natural gas.” In other words, despite reduced emissions from power plants themselves, upstream methane emissions mean that switching from coal to gas may not be a net climate benefit at all.

Second, any commitments we make to natural gas now are likely to lock us into an unsustainable pattern of greenhouse gas emissions for decades. The U.S. Department of Energy projects that natural gas-fired power plants are likely to have a 30-year useful life. When approving new gas plants, state regulators generally commit to allowing a utility to recover the total construction cost, plus profit, over the plant’s useful life. In effect, approval of new natural gas plants can guarantee that we continue to emit harmful greenhouse gases for decades to come.

But Renewables are a Hot Market

Renewable energy offers a better solution, and recent trends provide reasons for hope. 2014 witnessed the most effective investments in renewable energy around the world. BNEF expects a record level of 18.5 GW of renewable energy development in the United States in 2015. A new study from the Rocky Mountain Institute, The Economics of Load Defection, foresees a sea change in how Americans generate electricity: “Over time, as retail electricity prices from the grid increase and solar and battery costs decrease, customers logically reduce their grid purchases until the grid takes a backup-only role.” Distributed solar power and energy storage will likely become the primary source of electricity for most American consumers, meaning that investments in large, long-lived fossil fuel power plants will likely prove unnecessary and short-sighted.

According to a new survey from SolarCity, U.S. Homeowners on Clean Energy: A National Survey, Americans overwhelmingly support the transition away from fossil fuels and toward renewable energy. A resounding 87% majority agreed that renewable energy is important to America’s energy future, and 50% ranked solar power as the most important new energy source. When asked about federal tax credits for wind and solar energy, a whopping 74% backed continuation of these policies. Moreover, while renewable energy is often cast as a Democratic favorite, a Yale survey of Republican voters demonstrates that the support for a transition to renewable energy crosses party lines. 77% of surveyed Republicans believe that the United States should use more renewable energy, and 64% believe that the United States should take action to reduce fossil fuel use.

Continued Policy Progress is Necessary

In the United States, energy choices are policy choices. The United States has never had a free market for electricity; government regulators have always made the decisions that determine how we generate energy. The policy choices we make today will determine how clean our energy sources are tomorrow. Some policies are clearly helping. The federal Investment Tax Credit and Production Tax Credit for renewable energy have driven investment in solar and wind energy—although uncertainty about renewing those credits has also driven a boom-and-bust investment pattern. Congress should extend those tax credits to provide a solid foundation for continued market growth. Republicans in Congress especially should listen to their constituents—Yale’s survey of Republican voters found that a majority felt that elected officials neither listen to nor care about their constituents’ opinions on energy issues. At the state level, renewable portfolio standards have very successfully driven renewable energy development at low cost. States should continue to expand these successful policies. And at the local level, cities can help too. Georgetown, Texas recently aimed to become 100% powered by renewable energy (as did Vancouver, BC). At the local, state, and federal level, policymakers are making progress. If we continue to make policy progress, this year’s decline in carbon emissions will be just the beginning of a trend toward a truly clean energy grid.

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