issue: Energy & Environment

Wind, Solar, and Gas: Managing the Risks of America’s Clean Energy Transition

Posted on by The Progressive Policy Institute

Executive Summary

President-elect Joe Biden has set an ambitious goal for achieving zero carbon emissions from the nation’s power sector by 2035. The U.S. electric grid therefore faces a dual challenge: meeting growing demand for power while also decarbonizing the energy it supplies, which is essential to avert catastrophic climate change. At the same time, the challenge of maintaining an affordable and reliable grid is becoming more complicated, because of the increased frequency of extreme weather and the rapid growth of distributed renewable power – especially wind and solar – that is variable and unpredictable. It’s imperative that U.S. policymakers keep the nation’s environmental and energy needs in balance as the shift to renewables accelerates.  

Natural gas can play an indispensable role in managing the risk that a precipitous leap to renewables will make electricity more expensive and potentially less reliable. Gas already supports the expansion of renewable energy by providing an instantly dispatchable source of electricity. Unlike coal and nuclear plants, natural gas power plants turn on and off within minutes, allowing the grid to quickly match supply and demand even when the wind isn’t blowing and the sun isn’t shining. As the National Renewable Energy Laboratory points out, this unique flexibility of natural gas generation thereby facilitates the steady expansion of renewables. As we move toward decarbonization, retaining sufficient natural gas generation to backstop wind and solar power would reduce costs and increase reliability compared to a grid that relies entirely on renewables. Given these realities, demands to “ban fracking” or keep shale gas “in the ground” are not consistent with a balanced approach to decarbonizing the electric grid. 

In the decades ahead, natural gas generation must move toward zero carbon emissions to be part of America’s clean energy transition. To this end, U.S. policy makers and the natural gas industry should join forces to (1) invest more heavily in carbon, capture, and storage (CCS) technologies to quickly move gas-fired plants toward zero carbon emissions; and, (2) adopt and enforce ambitious goals for dramatically reducing methane emissions – which are many times more injurious to the climate than carbon dioxide emissions – from the natural gas lifecycle. This includes methane originating from abandoned wells that are no longer in use and have not been properly decommissioned. 

Neither of these changes will be easy. Despite recent progress, the development of CCS technology is generally nascent and has yet to be specifically applied to a natural gas power plant in the United States. At the same time, methane emissions from the natural gas sector are underregulated at the federal level, a problem made worse by the Trump administration’s rollback of methane regulations proposed by the Obama administration. Yet America’s ability to use our abundant gas resources to backstop and expand renewable energy on the electric grid requires swift progress on both fronts. 

There also are other ways in which natural gas can contribute to a decarbonized electricity grid—including but not limited to fuel substitution with renewable natural gas, blending of hydrogen into gas pipelines, creation of “blue” hydrogen, and the potential of new generation technologies such as Allam Cycle plants—that are important and beyond the scope of this report. 

Yet the political debate around energy and climate policy often presents Americans with a false choice between natural gas and renewable energy. Today the two are intertwined. America needs natural gas now to enable and backstop the rapid deployment of renewable energy on the grid (not to mention supplying power to U.S. industries and homes, which lies beyond the scope of this report). 

Rather than trying to ban fossil fuel production, progressives should keep their eyes on the real prize: achieving net zero carbon emissions. Because of the uncertainties surrounding the success of any of the technologies and methods mentioned above, no one can precisely predict how long it will take America to decarbonize its economy.  If decarbonization techniques applied to fossil fuels fail, a successful clean energy transition will require phasing them out. If they succeed in driving greenhouse gas emissions toward zero, natural gas could play a role in the U.S. energy mix into the foreseeable future. 

Therefore, this report urges President-elect Biden to strike a new bargain between the federal government and natural gas companies for decarbonizing the natural gas sector.  Washington would acknowledge and support the role gas plays in enabling rapid deployment of renewable energy in exchange for industry’s commitment to make consistent progress toward zero carbon emissions, achieved through the rapid development of CCS technology and dramatic reduction of methane emissions throughout the natural gas lifecycle. 

Crucially, this approach also could help to depolarize the debate over what to do about climate change. By rejecting unrealistic demands to abolish fossil fuels now, and speeding the technological advances necessary to decarbonize them, the incoming Biden administration could build a broader base of political support for a clean energy transition that meets America’s climate and economic needs.  

The Urgent Case for Climate Action  

Climate change poses a dire threat to our planetary health. Biden’s victory will end a shameful four years in which the United States has been absent from the fight to slow down climate change. Biden pledged to resume U.S. international climate leadership by rejoining the Paris climate accords immediately upon taking office. 

The Paris Agreement envisions limiting global average temperature increases to two degrees Celsius through a balancing of emissions sources and carbon sinks by midcentury. Over 75 countries representing approximately 11 percent of global emissions recently submitted to the United Nations strategies or pledges to achieve carbon neutrality by 2050. Meanwhile, China, which generates 29 percent of global emissions, making it the world’s largest greenhouse gas emitter, recently pledged to reach net zero emissions by 2060, although its near-term targets are far less ambitious than what Biden has proposed. 

Unfortunately, experts expect that, even if they are kept, country-level commitments under the Paris Agreement still leave us on an unacceptably dangerous trajectory toward a 3.3 degrees Celsius global average temperature increase, revealing an alarming ambition gap. This degree of warming implies at least a 4 percent reduction in gross domestic product for the United States economy, with our poorest counties projected to lose between 2 and 20 percent of their income by the late 21st century. 

Climate policies that channel the power of American ingenuity toward zero-carbon innovations are the key to avoiding catastrophic climate change. Thanks to innovations over the last decade, the costs of operating solar photovoltaics and onshore wind turbines in the United States has dropped dramatically, from $359 to $41 and $135 to $40 per megawatt-hour, respectively. Consequently, solar and wind energy have become booming economic sectors that employ over 350,000 workers. 

Moreover, the United States Energy Information Administration predicts that generation from renewables will provide at least 38 percent of our electricity by 2050. The Biden administration is likely to press for a more ambitious target, possibly even approaching 100 percent. At high rates of deployment, however, the intermittency of renewables requires the installation of much more capacity than is necessary to meet demand, thereby resulting in high costs. , To avoid this dilemma, we need a comprehensive federal policy that achieves the dual objectives of high renewable energy deployment and low electricity prices. President-elect Biden’s climate plan envisions achieving a carbon pollution-free electric grid that is then used to electrify the transportation and industrial sectors.  That’s not likely to happen, however, if electricity prices spike.

That’s why we need backup power generation that moves toward zero carbon emissions. Potential sources of zero-carbon power generation include natural gas power plants with carbon capture and sequestration (CCS) technologies, geothermal, hydropower, nuclear power, and bioenergy. Natural gas is important because we already rely on it to generate about one-third of our electricity. 

In a zero-carbon electric grid, the role of natural gas power plants with CCS technologies would shift from producing bulk energy to supporting renewables with zero-carbon dispatchable backstop capacity. In this way, the pitfalls of a hasty rush to 100 percent renewable energy – high prices and low reliability – can be avoided.  Instead, natural gas power plants with CCS technology can work in partnership with renewable energy to rapidly achieve a decarbonized electric grid. 

Unfortunately, the politics of energy and climate are deeply polarized. On the left, activists demand fracking bans and insist that shale gas and oil be left “in the ground.” On the right, climate deniers want continued U.S. reliance on fossil fuels. Although their voices are the loudest, a poll commissioned by the Progressive Policy Institute (PPI) for the 2020 election suggests that neither of these camps represent majority opinion.  

The poll delved into public attitudes in two presidential battleground states, Pennsylvania and Ohio, that also happen to be among America’s top five gas-producing states. The poll found that voters – including those in the “shale belt” counties where gas is produced — overwhelming see climate change as a serious problem and want the government to take vigorous action against it. At the same time, voters also overwhelming oppose (by 74-21 percent) a ban on natural gas extraction. Even among liberal and younger voters, there’s little appetite for a ban on gas production. That shouldn’t come as a big surprise, considering how important shale gas is to jobs and the economies of both states.

But the PPI poll shows that most voters have a pragmatic streak when it comes to energy and climate policy. Seventy-seven percent of voters in Pennsylvania and Ohio support using natural gas and nuclear power to support the expansion of renewable wind and solar power. They understand that gas plays many roles – generating electricity, fueling U.S. industries, and heating and cooling homes. Perhaps they also understand the role that gas plays in improving local pollution by displacing coal in the East Coast and Midwest States. 

The bargain proposed in this report is grounded in that spirit of pragmatism. It would hold a seat at the clean energy table for natural gas generators in exchange for assurances that U.S. lawmakers and the natural gas industry join forces to achieve zero carbon emissions through CCS technologies and dramatic reductions in methane leaks and emissions. 

How to Decarbonize the U.S. Energy Grid 

Natural gas is pervasive in the American economy as a fuel and a feedstock. Ample supply and low gas prices also have powerfully stimulated growth in the U.S. chemical industry, yielding a host of useful applications and creating a substantial number of jobs. Recently, the United States also has become a significant exporter of natural gas. In the context of the electric grid, as illustrated by Figure 1, natural gas powers our electric grid about one-third of the time. 

Figure 1
Projected Electric Generation from Natural Gas in the United States, Source: US EIA (2020)

Nearly all models that simulate what it would take for America to achieve deep decarbonization identify early action in the electricity sector as the linchpin to success. Models assume that a grid powered increasingly by renewable energy would then be used to electrify much of the transportation and industrial sectors, producing dramatic reductions in carbon emissions. For example, a study by Lawrence Berkeley and Pacific Northwest National Laboratories predicts a 60 to 110 percent increase in electricity demand by mid-century. 

In their comprehensive review of modeling efforts to date, Jenkins et al. (2018) identify two main paths to decarbonizing the electricity sector. The first path achieves a 100 percent renewable electric grid, primarily by relying on solar and wind. But there’s a big problem: the intermittency of renewables requires overbuilding total installed capacity to produce sufficient energy during periods when available short-term wind or solar output is well below average. One finding from the literature is that total installed renewable capacity should be three to eight times larger than peak demand. 

Such overcapacity directly increases electricity costs.  When the amount of available wind or solar power is above average, utilities are forced to reduce energy output because they can’t store the excess energy. When the amount of available wind or solar power is below average, then models rely on long-term expensive battery storage to keep the grid running. Finally, a 100 percent renewable grid tends to require optimistic modeling assumptions including continent-scale transmission lines and extremely flexible demand response.   

The second, more pragmatic path envisions a strategic backstop to wind and solar power by employing dispatchable forms of electricity. Most of the challenges associated with overreliance on renewables can be avoided by adopting a generation portfolio with some level of generation capable of fast ramp rates, low capital costs, and high variable costs. In this context, natural gas generators pair especially well with high buildouts of solar and wind.  

Adding a backstop like natural gas leads to total installed capacity that is much more closely sized to peak loads. This results in a reliable grid that delivers lower electricity prices. Moreover, the need for seasonal storage is completely avoided and grid reliability thereby is strengthened. Consequently, firm low-carbon resources are a consistent feature of the most affordable and reliable pathways to deeply decarbonizing the United States electricity grid. 

For example, a recent comprehensive exercise that models deep carbonization of the U.S. electrical grid finds that the availability of backstop power, such as natural gas generation with CCS, reduces electricity costs 10 to 62 percent compared to scenarios that rely exclusively on variable sources paired with energy storage. Cheap prices and reliable electricity are critical to achieving a decarbonized economy via mid-century, as envisioned in President-elect Biden’s climate plan.

As illustrated in Figure 2, a renewable-only approach is cheaper in the short-term but becomes exponentially expensive in the long-term the closer we get to a 100 percent renewable grid. Maintaining a role for natural gas with CCS technology can avoid the portion of the renewables only curve where costs grow exponentially and thereby lead to large cost savings. There’s no doubt that renewable energy can and should form the backbone of our zero-carbon electricity grid. But natural gas power plants with CCS technology would enable more rapid and strategic development of renewable energy by serving as an emissions-free backstop that secures lower electricity prices and ensures grid reliability.   

 

Figure 2
Electricity Costs and Renewable Penetrations for Different Decarbonization Strategies, Source: Spokas et al. (2020)

Generating Zero-Carbon Natural Gas 

Models that simulate decarbonization of the electric sector typically include natural gas generation with CCS technologies. For example, a recent study by the University of California Berkeley Goldman School of Public Policy assessed the feasibility of a 90 percent clean United States electricity grid by 2035 and relied on natural gas with CCS to provide dispatchable power. To achieve a 100 percent clean electricity grid, the authors highlighted two options: (1) further investments in CCS for natural gas, or, (2) further reliance on expensive alternatives—such as hydrogen or storage—that doubled marginal abatement costs into the range of 100 to 125 dollars per ton. 

Unfortunately, the use of CCS lags far behind what is required to meet America’s carbon-reduction targets under the Paris Agreement. The Petra Nova coal plant in Texas is the only U.S fossil-fuel powered plant capable of generating and capturing carbon in large quantities, but its operations were suspended earlier this year amid low oil prices and falling demand for energy as a result of the pandemic. Outside of the electricity sector, the U.S. has 10 of the world’s 19 large- scale CCS projects. Most operate in natural gas processing plants, fertilizer production, synthetic natural gas production, or ethanol production. There are no CCS projects operating on natural gas generators in the United States.

“Given the challenges now facing available firm low-carbon resources, it is tempting for policymakers, socially conscious businesses, and research efforts to bet exclusively on today’s apparent winners: solar photovoltaics, wind, and battery energy storage. That would be a mistake,” says Jenkins et al. (2020). Instead, the authors call for investing in a more technically diverse approach, which includes natural gas generation with CCS among other technologies, to secure low prices for zero-carbon electricity. 

Despite unfavorable economics today, the value of natural gas with CCS technology grows as renewable penetration or marginal costs of renewables become quite high. Therefore, Spokas et al. (2020) argue that excluding CCS technologies from our decarbonization toolkit based on present-day economics is likely shortsighted and fails to “recognize CCS may have significant value in the future and risks stunting CCS technology advancement.” 

A federal tax rule (45Q) provides an incentive for company investments in carbon sequestration. It is calculated by multiplying the metric tons of qualified carbon sequestered by a predetermined value. Depending on the type of project, the incentive ranges from $11.70 to $28.74 and rises annually accounting for inflation. The incentive requires secure geological storage of carbon emissions in deep saline formations, oil and gas reservoirs, or un-minable coal seams. The claimer of the credit must capture at least 500,000 metric tons of carbon annually. If the carbon captured somehow leaks out, the incentive must be repaid to the Treasury. 

At the state level, California has a low-carbon fuel standard that uses market trading to price credits for carbon savings. Credits recently have traded around $200 per ton. This also creates a strong incentive for producers to invest in CCS technologies, including direct air capture, CCS at oil and gas production facilities, and CCS at refineries. 

This patchwork of policies has led to an encouraging pipeline of new CCS projects across a broad range of geographies and technologies. The Clean Air Task Force’s CCUS Project Tracker reports 32 projects announced since 2018 that have the potential to sequester 40 million metric tons of carbon dioxide annually. Eight of these projects leverage financing through California’s low-carbon fuel standard in addition to using the federal 45Q incentive.  Six of these projects aim to apply CCS technologies to natural gas power plants. Spokas et al. (2020) argue that CCS technology on natural gas plants is technically feasible and could break even from an economic perspective if they combine 45Q with enhanced oil recovery, which is the use of captured carbon to extract oil that could not have otherwise been extracted.

Ultimately, natural gas generators with CCS must be deployed at scale to achieve an effective zero-carbon backstop for renewables. The policy and technical inertia surrounding CCS development must be expedited to ensure that CCS technologies develop quickly enough to be applied successfully to a natural gas generator as soon as possible. Therefore, the federal and state policies that have spurred new CCS projects should be strengthened. For example, the Clean Air Task Force has proposed a modification of the 45Q incentive to expand the effective window of eligibility for new CCS projects. 

Dramatically Reducing Methane Emissions from the Natural Gas Lifecycle 

Natural gas emits about half as much carbon dioxide as coal when combusted. That is a primary reason why switching from coal to gas generation led to big reductions in carbon emissions from the electricity sector after the shale gas revolution started. However, natural gas producers emit significant amounts of gas by venting, inefficient flaring, and “fugitive” emissions through leaks in wells and equipment. These emissions have a disproportionately large impact on the climate because the primary component of natural gas, methane, warms the globe 86 times more effectively than carbon dioxide over a 20-year time frame. Therefore, if not controlled, fugitive methane emissions could more than offset the climate gains of switching to gas from coal. 

Studies show that gas is more climate friendly than coal so long as methane emissions are kept below 2.7 percent of gas production., As illustrated in Figure 3, methane emissions are generated in four natural gas “subsectors”: production, processing, transmission and distribution. A recent study estimates that national methane emissions were 2.3 percent of total gas production in 2015, suggesting only a slight advantage to using natural gas over coal in that year. Another recent study estimates that methane emissions from the Permian Basis, a major producing region in Texas, were 3.7 percent of production in 2018 and 2019, suggesting a significant disadvantage from using natural gas from this regional over coal. Moreover, comparisons to coal are less relevant as coal-fired generation decreases and renewable generation increases. In short, methane emissions must be reduced dramatically if natural gas is to play its crucial role as a zero-carbon firm resource to backstop renewables. 

 

 

Figure 3
Recent Estimates of Methane Emissions from United States Natural Gas Subsectors,

Source: Adapted from World Resources Institute (2019)

The Trump administration, unfortunately, moved in the opposite direction. It rolled back one of the last Obama-era climate regulations that would have reduced methane emissions from oil and gas wells constructed after 2016 and prompted regulations on existing oil and gas wells. Major oil and gas players including BP, Exxon, and Shell supported the regulation. The main opposition came from smaller oil and gas players. 

The Clean Air Task Force estimates that Trump’s collective rollback of methane regulations will increase emissions 4.3 million metrics tons in 2035 and warm the climate as much as the carbon emissions of nearly 100 coal-fired power plants. Beyond climatic costs, the Trump administration’s rollbacks threaten public health and safety. For example, methane leaks lead to ozone formation and often include emission of volatile organic compounds that are known to aggravate respiratory problems and can be carcinogenic. 

Several states have stepped into the leadership vacuum. Led by former Governor and now U.S. Senator John Hickenlooper, Colorado imposed several types of regulations, most notably a leak detection and repair program that began in early 2010s. My own 2017 study, with Alan Krupnick from Resources for the Future, reports that the number of estimated leaks in Colorado has fallen by 75 percent since these rules went into effect. California, Massachusetts, and New Mexico have followed Colorado’s lead with their own forms of regulation, but by and large methane emissions remain largely under-regulated by state governments. 

Some industry players are voluntarily reducing their emissions. ONE Future, for example, is a coalition of 30 natural gas companies working together to voluntarily reduce their methane emissions across the natural gas life cycle to 1 percent or less of produced natural gas by 2025. ONE Future reports that their methane emissions were well below one percent for 2017 and 2018. More recently, the American Gas Association and Edison Electric Institute launched the Natural Gas Sustainability Initiative which aims to measure methane emissions intensity across the natural gas lifecycle. As a final example, The Environmental Partnership is a newly formed group of companies voluntarily implementing best practices and installing certain equipment to reduce their methane emissions. Many of these efforts build upon EPA’s Methane Challenge Program, a voluntary program aimed at sharing information that facilitates methane emissions reduction.

In addition, a host of non-profits and start-ups also are measuring, labeling, and trading “green” or “climate differentiated” natural gas with low methane emissions.  My own 2020 study, with Alan Krupnick of Resources for the Future, surveys these efforts, which started with a “sustainable” gas transition between Southwestern Energy and New Jersey Resources in 2018. A similar trade for “carbon-neutral” liquified natural gas occurred in 2019 between Shell and Tokyo Gas. 

The Rocky Mountain Institute has recently launched a digital platform that will offer emissions data from satellites, aircrafts, and monitoring stations to help companies assess methane emission against performance benchmarks. While these efforts are encouraging, we argue that further federal government involvement in these voluntary markets is necessary to increase participation, enhance ambition, and improve both the accuracy and credibility of these efforts. 

Federal action is imperative because methane emissions from the natural gas sector are still too high and may even be trending in the wrong direction. Based on EPA data, which likely underestimates methane emissions on average, methane emissions from the natural gas system have slightly increased since 2016, from 135.8 to 140.0 MMTCO2-eq. Some methods for measuring methane emission carry high levels of uncertainty, which indicates a need for uniform standards. None of the voluntary efforts to date have achieved widespread industry participation that federal regulations could mandate. Nor have they set the type of ambitious targets that federal regulations could mandate, instead tending to identify modest reductions that ensure natural gas maintains its climate advantage over coal and gasoline, rather than prioritizing maximum abatement. 

Federal methane regulation should be designed both to cut methane emissions and to equate the private and social costs of methane, which amount to over 1,100 USD per ton.  Any methane regulation must address the downward bias and large uncertainties associated with the methane inventory maintained by the U.S. Environmental Protection Agency. 

For starters, Washington lawmakers should aim at replicating Colorado’s leak detection and repair programs, given that these programs can quickly remedy major leaks and potentially lead to improved inventories. My 2017 study, with Alan Krupnick of Resources for the Future, explores a variety of additional policies to reduce methane emissions that are compatible with other possible federal climate policies, such as carbon taxes or clean energy standards. For example, a nationwide carbon tax could be modified for methane by imposing an assumed default rate of emissions per ton of natural gas produced. 

This default rate is necessary because of uncertainties regarding the quantification of methane emissions and the rate itself could be challenged by polluters via a pre-defined regulatory process. In this way, the default rate ensures that estimated methane emissions are not lower than actual ones, while the challenge process allows companies that beat the default rate to make their case. Similarly, a tradable performance standard could be constructed to achieve a certain leakage rate in the natural gas sector, an approach that could pair well with a broader clean energy standard as envisioned in President-elect Biden’s climate plan. 

Other proposals contemplate requiring the reporting of financial liabilities associated with methane and carbon emission on a company’s financials, which would create a powerful incentive to maximize emission reductions. Tougher federal regulation, combining the approaches outlined here, is an essential component of a comprehensive and credible strategy for reducing U.S. methane emissions.

Plugging Old Gas Wells

I managed a small team of researchers at Resources for the Future in 2015 and 2016 that focused on estimating the economic and environmental impacts of end-of-life wells. We estimated that there are up to 2.67 million inactive oil and gas wells in the United States. Left unplugged, we found that these wells can emit methane, contribute to poor air quality, and contaminate surface water. Moreover, our research uncovered that bonds posted by gas drillers, although intended to cover the cost of properly plugging wells, are not nearly enough to cover plugging costs in most states. The result is a large pool of inactive wells that are improperly plugged. Methane emissions from abandoned wells are estimated to have the same climate impact as greenhouse gases emissions from 2.1 million passenger vehicles. 

Properly plugging abandoned wells is a prerequisite to achieve near-elimination of methane emissions from the entire natural gas lifecycle. For starters, regulators should increase bonding requirements at the state and federal levels. Another approach would be the creation of a federal agency with dedicated funding to plug abandoned wells. Raimi et al. (2020) suggest that the Covid-19 pandemic in conjunction with low employment rates in the oil and gas industry justify such a federal program. The authors estimate that a significant federal program to plug abandoned wells could create tens of thousands of jobs. 

Near-elimination of methane emissions would also create lucrative new opportunities for U.S. natural gas exporters. For example, a recent strategy from the European Union on methane emissions suggests an imminent surge in demand for “green” natural gas exports with low methane emissions. Indeed, natural gas exports with anything more than low methane emissions may not be permitted to trade internationally. Concerns over methane emissions led the French government to recently block a liquified natural gas deal between a Texas company called NextDecade and a French company called Engie. As methane emissions are controlled, exports of U.S. gas could help other countries reduce their carbon emissions. 

Managing Risk and Uncertainty in Energy Policy 

The evolution of America’s zero-carbon energy transition is fraught with uncertainty. It is contingent on the evolution of technologies in various stages of development. Policymakers should therefore approach the subject with a degree of humility. After all, no one predicted 20 years ago that new drilling technologies would create a shale boom that has propelled the United States back to the forefront of world’s leading oil and gas producers. Likewise, no one today can foresee the innovations and technological breakthroughs that could upend today’s prevailing assumptions about the best way to decarbonize our economy. 

Uncertainty implies risk and the prudent way to manage risk is through diversification. Putting all our eggs in a single basket – through policies based on a narrow vision of a zero-carbon grid powered by 100 percent renewables – is unwise. Unfortunately, some climate activists seem willing to bet everything on this single path to decarbonization. 

The risk in taking this single path is that it will expose Americans to high electricity prices and potentially periodic energy shortages on the way to our destination. It may also, of course, lead to premature or unnecessary destruction of good jobs in the natural gas sector. The resulting political fallout could slow or even block American’s clean energy transition. That is why President-elect Biden has made clear that, despite President Trump’s claims to the contrary, he opposes fracking bans. 

The pragmatic and progressive course forward is to pursue multiple avenues to decarbonization. Government and private industry should invest in a broad portfolio of energy sources and technologies that can lead us to zero-carbon energy generation and craft policies to ensure consistent and rapid progress. These energy sources and technologies include CCS and many other options including advancements in geothermal, hydrogen, and nuclear.

A bill introduced by Representative Diana DeGette, the Clean Energy Innovation and Deployment Act (CEIDA), embodies many of the principles discussed in this report. CEIDA would create a standard that transitions the electricity sector to 100 percent clean energy. As part of that standard, zero and low emitting technologies will be rewarded by receiving credits that can be sold to dirtier technologies.  Natural gas would receive partial credit, although associated methane emissions would be accounted for. Consequently, CEIDA strikes a balance between wind, solar, and gas that displays awareness about the risks of America’s clean energy transition. In part because of this awareness, CEIDA received positive reviews from a wide array of environmental, industry, and labor groups. Therefore, CEIDA provides a useful starting point for the Biden administration and Congress.  

Conclusion 

Natural gas generators can play an indispensable role in decarbonizing the electricity sector by providing dispatchable energy that backstops rapid deployment of renewable energy. A bargain that invests in CCS technologies while requiring that industry dramatically reduce methane emissions would facilitate the deployment of zero-carbon natural gas generation. Such a bargain would accelerate high penetrations of renewables while achieving low electricity prices and ensuring grid reliability. These conditions are tailored for achieving widespread decarbonization because cheap electricity prices in a zero-carbon electric grid can then be leveraged to electrify the entire economy, including industry and transport. Natural gas generators with CCS technologies paired with low methane emissions from the natural gas life cycle represents a strong path forward for achieving President-elect Biden’s goal of a carbon pollution-free electric sector by 2035 and a net-zero emissions economy by 2050.

 

How Natural Gas Can Play A Long-term Role in Meeting Growing Demand and Decarbonization Goals

Posted on by The Progressive Policy Institute

Gas Currently Supports Solar and Wind Expansion But Must Reduce Emissions Further in Coming Decades to Meet U.S. Climate Goals

Contact: media@ppionline.org

WASHINGTON, D.C. – The Progressive Policy Institute released its latest “Memo to the President-elect” report on the urgent need for U.S. policymakers to both regulate and increase technologies incentives to reduce emissions from natural gas so that gas can continue to play an important role in long-term U.S. economic growth and decarbonization. 

“In meeting his ambitious electricity decarbonization goals, President-elect Biden should both regulate methane reductions and increase incentives for carbon capture, enabling gas to achieve deeper emission reductions and continuing its complementary role in the expansion of renewable energy,” said PPI President Will Marshal.

The report finds that to achieve Biden’s goal of net zero electricity emissions by 2035, the U.S. should use natural gas to both enable and backstop the rapid deployment of renewable energy on the grid.   Despite the role of natural gas in meeting climate goals to date, the political debate around energy and climate policy often presents Americans with a false choice between natural gas and renewable energy. The report details the way in which natural gas can make the clean energy transition, including the expansion of renewable energy, possible without making electricity more expensive and potentially less reliable, and therefore less politically feasible.

 “The U.S. electric grid faces a dual challenge: meeting growing demand for power while also decarbonizing the energy it supplies, which is essential to avert catastrophic climate change,”  said report author Clayton Munnings.  “If the report recommendations are adopted, natural gas can continue to play an important role in meeting these challenges, and achieving President-elect Biden’s zero carbon emissions goal for the nation’s power sector by 2035.”  

 

The report’s key highlights include: 

  • Natural gas can play an indispensable role in the expansion of renewable energy. Natural gas today already supports the expansion of renewable energy by providing an instantly dispatchable source of electricity. The unique flexibility of natural gas power plants to turn on and off within minutes, which coal and nuclear plants cannot offer, means gas quickly matches supply and demand even when the wind isn’t blowing and the sun isn’t shining.
  • Rather than trying to ban fossil fuel production, progressives should keep their eyes on the real prize: achieving net zero emissions. Uncertainties abound when it comes to nascent renewable and storage technologies and no one can precisely predict how long it will take America to decarbonize its economy. The U.S. should rely on natural gas to provide dispatchable energy to increase the chances of a successful clean energy transition.
  • Federal policy should encourage the natural gas sector to make consistent progress toward zero carbon emissions. Washington should acknowledge and support the critical role of natural gas in exchange for industry’s commitment to make consistent progress toward zero carbon emissions. Such progress will require the rapid development of CCS technology and dramatic reduction of methane emissions throughout the natural gas lifecycle. Federal policy should invest more heavily in CCS and adopt and enforce ambitious goals for dramatically reducing methane emissions.
  • American voters are pragmatic and support a balanced approach to energy. With some activists demanding fracking bans and climate deniers desiring continued U.S. reliance on fossil fuels, a 2020 poll commissioned by the Progressive Policy Institute (PPI) suggests that neither of these camps represent majority opinion. For example, seventy-seven percent of voters in Pennsylvania and Ohio support using natural gas and nuclear power to support the expansion of renewable wind and solar power, representing a pragmatic approach to energy and climate policy.
  • Federal policy should aim at the dual objectives of high renewable energy deployment and low electricity prices. If not properly balanced, a transition to a grid powered by renewable energy will expose Americans to high electricity prices, create potential periodic energy shortages, and lead to premature or unnecessary destruction of good jobs in the natural gas sector. In particular, low electricity prices would enable further electrification of the transport and industrial sectors. Federal policy should take care that energy goals don’t create adverse consequences for consumers. 

“Rather than trying to ban natural gas production, which is politically fraught, progressives should keep their eyes on the real prize: achieving net zero emissions,” said Munnings. 

 

Battleground voters are pragmatic on energy

Posted on by The Progressive Policy Institute

Unfazed by President Trump’s non-stop belligerence in last Tuesday’s debate, Democratic presidential nominee Joe Biden embarked the next morning on a whistle stop tour of Ohio and Pennsylvania — two pivotal states Trump won in 2016 that now seem to be slipping from his grasp.

In addition to their huge importance as presidential battleground states, Pennsylvania and Ohio rank among the top five U.S. states in natural gas production. No wonder Trump keeps trying to convince voters there that the former vice president is a Green New Deal zealot eager to ban drilling for natural gas.

Only it’s not true, and it’s not working. According to a new ALG Research Poll commissioned by the Progressive Policy Institute (PPI), Biden is leading Trump in Pennsylvania (50-44) and Ohio (48-46). What’s more, Biden is running significantly ahead of Hillary Clinton’s 2016 performance in the “shale belt” — the gas-producing counties of Southeastern Ohio and Western Pennsylvania that Trump won handily last time.

Read the full piece here.

Battleground Voters Pragmatic on Climate & Energy

Posted on by The Progressive Policy Institute

Following last night’s debate, Joe Biden will campaign in Pennsylvania and Ohio, where a new poll released today by the Progressive Policy Institute (PPI) shows him leading President Trump. In addition to their huge importance as presidential battleground states, Pennsylvania and Ohio are energy powerhouses that rank among the top five U.S. states in natural gas production. 

The poll, commissioned by PPI and conducted by ALG Research, finds Biden ahead by six points in Pennsylvania (50%-44%) and two points in Ohio (48%-46%), despite Trump’s attempts to brand Biden falsely as an opponent of “fracking” and natural gas. Biden also is running ahead of Hillary Clinton’s 2016 performance in the “shale belt” — the gas-producing counties of Southeastern Ohio and Western Pennsylvania. 

“Unlike the ‘drill, baby drill’ right and the ‘keep it in the ground” left, voters in midwest states like Pennsylvania and Ohio show a deeply pragmatic streak on energy and climate issues,” said PPI President Will Marshall. “They are not climate deniers like Donald Trump, and they view natural gas as a bridge, not a barrier, to America’s clean energy transition.”

Key poll findings:

  • 71% of Pennsylvania and Ohio voters — and 66% in gas-producing counties — say climate change is a “real and very serious problem.”
  • Voters oppose a ban on natural gas by an enormous margin — 53 points (74-21%).
  • Even among liberal leaning groups, there is little appetite for a ban: Democrats, young voters and advanced degree holders oppose a ban by 30, 29 and 55 points respectively.
  • Voters’ biggest worry about banning gas production is job loss, following by higher energy prices. 
  • Voters do not want to use fossil fuels indefinitely, but they see natural gas as playing an important role in supporting U.S. renewable energy growth over the medium term.
  • Voters expect it will take a decade or more to end use of natural gas without disruptions to the economy, electric reliability, and energy bills.

Despite Biden’s lead in this poll, voters split over who they trust more on energy issues. 

“Voters know where Trump stands on energy, but they aren’t as certain about Biden,” said Marshall.  But when it’s described to them, 52% of voters say they support a Biden plan that does not ban fracking, continues to use natural gas and requires the United States to achieve zero carbon emissions by 2050.

View the full polling memo here.

Media contact: Carter Christensen, cchristensen@ppionline.org

 

Appendix B: State Breakdowns on Key Findings:

o Pennsylvania: Voters oppose a natural gas extraction ban by 72-23%.o Ohio: Voters oppose a natural gas extraction ban by 76-19%.

o Pennsylvania: Democrats oppose a ban on natural gas extraction by 59%-32%.o Ohio: Democrats oppose a fracking ban by 65-30%.

o Pennsylvania: The biggest worry associated with banning natural gas is job loss (40%), followed by increased energy prices (20%) and energy shortages (15%).

o Ohio: The biggest worry associated with banning natural gas is job loss (26%), followed by increased energy prices (18%) and energy shortages (15%).

o Pennsylvania: 57% of voters see natural gas as playing an important role in supporting U.S. renewable energy growth over the medium-term.

o Ohio: 53% of voters adhere to this view.

o Pennsylvania: 43% of voters say we should be using more natural gas; 34% say we should be using the same amount of natural gas versus; and, 18% say we should use less natural gas.

o Ohio: 41% of voters say we should be using more natural gas; 37% say we should be using the same amount of natural gas; and, 18% say we should use less natural gas.

 

Changing the climate of presidential debates

Posted on by The Progressive Policy Institute

When future generations — or simply young people today — look back at the topics of recent U.S. presidential debates, they will be stunned that America’s political journalists ignored climate change, the issue that will overwhelm most others in coming years. In essence, debate moderators have pretended climate change doesn’t exist.

Not a single question on climate change was asked by any moderators in the three 2016 presidential debates, even though Donald Trump and Hillary Clinton had diametrically opposing views on climate science and policy. The same silence occurred in the previous round of debates in 2012, and also 2000, and 1996. And now climate change has been ruled out as a topic at the first 2020 Presidential debate this Tuesday in Cleveland.

The consequences on American policy of this willful climate silence during debates has been remarkably far-reaching, especially during Donald Trump’s presidency. The U.S. is the only country in the world to leave the Paris Climate Agreement, and Mr. Trump has ignored entreaties by other world leaders to use other means to make progress on the issue. Domestically, the Trump Administration has repealed or attempted to rollback every climate protection it can, especially limits on greenhouse gas emissions from most major sources, including power plants, cars, and oil and gas drilling.

Read the full piece here.

Denier-in-chief: Trump, COVID and climate change

Posted on by The Progressive Policy Institute

It is a tale of two worlds. In Real World, the COVID scourge continues to inflict massive human suffering and economic costs on the American people. More than 177,000 Americans have died. More than 5.7 million have been infected. These are by far the largest tolls in the world. No wonder the U.S. economy is now a basket case.

More than 22 million jobs were lost in April alone, and many more in March and May, yet only 42% of those jobs have returned. Even with so many jobless Americans waiting to go back to work, job growth has slowed with July employment less than half that of June, and August looking weaker still.

This is the worst job market since the Great Depression. Yet after more than almost nine months, the Trump administration still does not have a coherent or effective national COVID-19 strategy, and Senate Republicans went on vacation rather than pass unemployment extensions for millions of jobless Americans.

But as his convention continues, the president seems to reside in Trump World, a land of alternative facts where everything appears fine. Late last week, Trump called his presidency the “most successful period of time in the history of our country, from every standard” and said his administration has “demonstrated over the last four years the extraordinary gains that are possible.”

Meanwhile, this week heatwaves, wildfires and hurricanes, all made much worse by climate change, are devastating communities and making life unbearable for tens of millions of Americans across the country.

In California, a massive heatwave scientists say is exacerbated by climate change has led to 600 separate fires, including the second and third largest in state history, which have killed seven people thus far. More than one million acres have burned, three times the annual average, just in the last nine days. More than 100,000 people have been evacuated. Even as the coronavirus pandemic increases respiratory illness, air quality has been fouled for tens of millions across the West.

Read more here.

Make America #1 in Electric Vehicles

Posted on by The Progressive Policy Institute

Achieving U.S. climate resilience requires a dynamic and unprecedented American clean energy transition, including large investments in zero-emissions infrastructure and clean energy manufacturing — the fastest growing global manufacturing sector set to attract $10 trillion in investment by 2050.

A new report from the Progressive Policy Institute finds the U.S. has the opportunity to build tens of millions of new electric vehicles, charging stations, and the advanced electric grid to serve them, as well as upgrading our roads, bridges, high-speed internet, ports, and public transport to fulfill this clean energy vision. The Covid-19 economic and unemployment crisis has only intensified the political imperative to create millions of these new, clean energy jobs, with a particular emphasis on well-paid manufacturing.

In his 2016 campaign, Donald Trump famously promised to revitalize American manufacturing and rebuild our crumbling infrastructure. But as president he has done neither one. In fact, U.S. manufacturing declined deeply during each quarter of 2019, long before the coronavirus reached our country.

Now former Vice President Joe Biden and other Democrats have put clean energy at the center of bold blueprints for reviving the comatose U.S. economy. The House last month passed a $1.5 trillion infrastructure and tax package, and Biden recently unveiled his $2 trillion “Build Back Better” plan. But ambitious as these proposals are, they do not offer a detailed roadmap for making America the global leader in the key clean energy technologies, especially electric vehicles, and related technologies like an advanced electricity grid and storage.

Yet the mass commercialization of electric vehicles is key to cutting the largest source of U.S. greenhouse gas emissions, making America’s air cleaner and healthier, ending dependence on foreign oil, and bringing about a resurgence of the U.S. auto industry and American manufacturing jobs.

Until we are producing American-made vehicles that can beat oil-burning cars on price and consumer appeal over the long-term, the clean energy transition in the key transport sector will not gain speed. We need a muscular new vision of America’s clean energy infrastructure and manufacturing sector creating millions of good new jobs. This is modern equivalent of Franklin D. Roosevelt’s “Arsenal of Democracy”— helping to solve many of our economic, manufacturing, trade and environmental problems together.

The United States can’t afford to forfeit the lead on electric vehicles to China, as has happened with other clean energy technologies. For example, China in 2008 devoted half its total $650 billion stimulus to manufacturing PV solar panels and lithium ion batteries, growing China’s PV solar panel global market share from less than 30% to about 70% today.

Cars are far more important to America’s economy and national identity than solar panels. Thanks to heavy investments in electric vehicle technology, China already is dominating the emerging global EV market, with over 50% of global production, and 73% of the EV battery market. Meanwhile, the US produces fewer than 20% of EVs. Industry experts predict that electric vehicles will be the key to auto industry growth over the next years and decades—from less than two million EVs today to more than 30 million by 2030—representing the world’s most important new manufacturing market.

But today, most Americans cannot afford the excellent but more expensive EVs that dominate the U.S. market. And the EVs that are affordable are not available in models—especially SUVs, minivans and light trucks—that most U.S. consumers prefer, and that provide higher profit margins for automakers.

America needs a new approach to the electrification of transport – a comprehensive program to jumpstart the production and purchase of the electric cars and trucks Americans want and can afford. The existing federal consumer tax credit of $7,500 per EV has reached a cap of 200,000 for GM and Telsa, the largest US producers. While Democrats
in Congress have proposed raising the cap per manufacturer, this minor change won’t drive large and rapid electrification of the U.S. fleet. And Republicans have (hypocritically but successfully) attacked the current tax credit as a government giveaway for “Tesla millionaires” that favor only the richest consumers.

Instead, Congress should provide average American consumers much larger tax credits for purchase of affordable U.S.-made EVs, including models Americans actually want, especially minivans, SUVs, and light trucks. This means dedicating large consumer tax credits to the purchase of more affordable EVs with an emphasis on high-volume model types on graduated scale as follows: $15K credit for vehicles under $35k: $7.5k for EVs under $50k; $2.5k under $75k and $1.5k under $100k. A version of this PPI approach has been crafted into legislation by US Rep. Jackie Speier; the bill has over 30 cosponsors but, the tax credit must be applied to SUVs and trucks to achieve volume and scale and gain broad bipartisan support.

Buyers should also get to use the EV credit over a 5-year period, or apply the credit at the point of sale, making it more applicable to average income buyers who lack large tax liability. Additional measures should include extra tax incentives for trade-in’s to rapidly turn over the non-EV fleet (“cash for clunkers”) and requiring the federal government fleet to purchase U.S.-made EVs. And infrastructure legislation must provide strong incentives for electric charging stations, advanced electric grid and storage.

The rapid retooling at GM and Ford to build ventilators and masks to address the Covid-19 crisis illustrates the ability of automakers to adapt to new market demands and government incentives. In fact, many these plants had been making hybrid car batteries.

With nearly 20 million people out of work, America must create millions of new jobs by investing in an infrastructure-led manufacturing recovery through federal legislation just as we did in the 1930s New Deal, the 1950s Interstate Highway System, 1960’s through NASA and the 2009 American Recovery and Reinvestment Act. We must also train workers in technology and manufacturing skills through high schools and community colleges, focused where unemployment is highest, in direct cooperation with EV and other clean energy employers.

America has led the world in auto innovation for most of the last century. We must do so again in a new era. U.S.-made EVs are crucial to climate resilience, the U.S. economic rebound and gaining broader political support for the clean energy transition. It’s time to act.

Bledsoe for USA Today: “Don’t fuel Donald Trump’s culture war on climate change. Beat it instead.”

Posted on by The Progressive Policy Institute

Australia’s raging infernos, like our Western wildfires and more devastating storms, prefigure a darker climate future for all of us without urgent action. But for President Donald Trump, the climate crisis is just another opportunity to stoke anger among the American people and further divide us.

Trump has undermined every climate protection possible, not out of any philosophical conviction about smaller government, but in large part to deliberately provoke outrage on the left, and then use the limelight to falsely portray climate-protecting policies to his base as a culture war waged by left-wing elitists against average voters.

Earlier this month, it was a White House event where he announced proposals to weaken climate protections in the National Environmental Policy Act. In fact, NEPA could benefit from reasonable reforms — not the ones Trump proposes, but, for instance, allowing the siting of clean energy infrastructure needed to rapidly cut greenhouse gas emissions. But in Trump World, creating contempt for climate protection itself, like slurring immigrants or race-baiting rhetoric, is a key ingredient in the toxic stew of cultural resentment he pre-cooks in search of alienated voters hungry for scapegoats.

Read the full piece here.

Gold for Medium: “Attention Democrats: UK Elections Not Only Cautionary Tale from Europe”

Posted on by The Progressive Policy Institute

As Democratic presidential hopefuls gather in Los Angeles this week for the last debate of 2019, candidates should look across the Atlantic for a cautionary tale.

No, I’m not just talking about last week’s UK elections, which saw Labour’s far left-wing leader, Jeremy Corbyn, get crushed by Brexiteer Boris Johnson. Democrats can also draw useful lessons from the United Nations Conference of Parties (COP25) in Madrid, which by all accounts failed to kickstart progress toward implementing the Paris Climate Accords.

The culprit here, of course, is President Trump. His threat to pull the United States out of international efforts to combat climate change has created a major vacuum of leadership. What happened in Madrid underscores the folly of relying mainly on governments to tackle the climate crisis. Democratic presidential hopefuls should promise not only to re-exert U.S. leadership but to engage the private sector in efforts to reduce greenhouse gas emissions — regardless of which way the political winds happen to be blowing.

Read the full piece here.

Bledsoe for the New York Times: “Our Future Depends on the Arctic”

Posted on by The Progressive Policy Institute

Delegates from nearly every nation spent the last two weeks here at a United Nations climate summit struggling to chart a course to meet the extraordinarily difficult goal of net zero emissions of carbon dioxide by the year 2050.

Yet long before then, the effects of global warming could spin out of control. As the United Nations’ secretary general, António Guterres, warned in opening the meeting: “The point of no return is no longer over the horizon. It is in sight and hurtling toward us.”

Perhaps nowhere is that more true than in the Arctic. The surface air there is warming at twice the global rate and temperatures over the past five years have exceeded all previous records since 1900. This past week, the National Oceanic and Atmospheric Administration reported that the extent of Arctic summer sea ice was at its second lowest point since satellite observations began in 1979, and that average temperatures for the year ending in September were the second highest since 1900, when record-keeping began.

Read the full piece here.

Bledsoe for Forbes: “Tax Credits for Affordable Electric Vehicles Gain Speed, But Legislation Must Avoid Stop Signs

Posted on by The Progressive Policy Institute

As Congress begins to turn toward tax policies to help clean energy manufacturing, electric vehicle tax credits aimed directly at more affordable vehicles are gaining speed, just as a previous Forbes column and a Progressive Policy Institute (PPI) white paper urged several months ago.

The question now is will EV advocates in Congress, the U.S. auto industry and labor unions get the message and reform tax incentives to benefit middle-income Americans. Such revised tax credits focused on more affordable EVs will increase the chances new incentives become law, and will better allow the U.S. to reap the remarkable economic, health, manufacturing and environmental benefits of EVs. Yet as of now, new EV tax credits have been left entirely out of a so-called “tax extenders” outline circulating among House Ways and Means Committee members.

But a series of new developments are demonstrating that tax credits focused on affordable vehicles are gaining momentum.

 

Read the full piece on Forbes by clicking here. 

Bledsoe for The Hill: “Biden’s domestic climate plan is good, but his global strategies are crucial”

Posted on by The Progressive Policy Institute

As many climate activists had hoped, Democratic presidential front-runner Joe Biden came forward this week with an ambitious domestic climate change plan that proposes to cut U.S. emissions deeply while growing America’s clean energy sector.

Yet, as important as the domestic elements of Biden’s plan and those of his rivals are, they are ultimately most valuable ecologically in legitimizing the key international aspects of climate protection, which are crucial to solving the inherently global nature of the climate problem in the first place.

After all, U.S. greenhouse gas emissions are only about 15 percent of the world total, compared to 30 percent from China alone. Fortunately, the E.U., U.S., China and fewer than 10 of other nations account for well over 80 percent of global emissions, meaning targeted international efforts have strong potential to reach the lion’s share of the problem.

Credible U.S. domestic climate action is a precondition to gaining the trust and respect of the rest of the world — and allowing America to exert unique pressure on other major nations to cut their emissions.

Read the full piece here.

New Ideas for a Do Something Congress No. 7: Winning the Global Race on Electric Cars

Posted on by The Progressive Policy Institute

On Donald Trump’s watch, America is losing what is probably the most important new manufacturing opportunity in the world–the global race to produce affordable electric vehicles that people want to drive. The United States currently accounts for just 20 percent of global electric vehicle production, far behind China.

Jumpstarting U.S. production and purchase of Electric Vehicles (EVs) would produce an unprecedented set of benefits, including cleaner air and a reduction in greenhouse gas emissions; a resurgence of the U.S. auto industry and American manufacturing; the creation of millions of new, good, middle class manufacturing jobs; lower consumer costs for owning and operating vehicles; and the elimination of U.S. dependence on foreign oil. U.S. automakers are already moving toward EVs, but the pace of this transition is lagging behind our foreign competitors. A dramatic expansion of tax credits for EV purchases could go a long way toward boosting the U.S. EV industry as part of a broader agenda to promote the evolution of the transportation industry away from carbon-intensive fuels.

 

THE CHALLENGE: THE US ELECTRIC VEHICLE INDUSTRY IS FALLING BEHIND ITS GLOBAL COMPETITORS

Leading experts predict (1) that electric vehicles will be the key to global auto industry growth over the next years and decade—from about 1.1 million EVs last year to 30 million by 2030. Ominously, however, China is already dominating (2) the emerging EV market, with about 40 percent of global production, and plans to expand even more rapidly over the next few years. The United States, on the other hand, currently produces only about 20 percent of the world’s EVs and is moving too slowly on the EV transition.

Electric vehicles account for just 0.3 percent of the total U.S. fleet

U.S. EV production is small – fewer than 200,000 were manufactured (3) here last year, accounting for less than 0.3 percent of the total U.S. fleet. Production is also not growing nearly fast enough. Out of the roughly 350 million vehicles on the road today, a little more than 1 million are electric.

Electric vehicles are too pricey for most consumers or are not offered in models consumers want

Most Americans cannot afford more expensive EVs—like the high-end Tesla models—that have dominated (4) the market so far. For example, two of the top three selling models in 2017 cost well over $80,000 a vehicle. The second selling model, the more affordable Chevy Bolt (still more than $36,000), sold only about 25,000 units in 2017. And the EVs that are affordable are not available in the models—especially SUVs, minivans and light trucks—that most consumers prefer, and that provide higher profit margins for automakers. As a consequence, fewer than 2 percent of the more than 17.3 million new American car purchases in 2017 were of plug-in hybrid electric vehicles or battery-electric vehicles.

 

THE GOAL: MAKE AMERICA THE GLOBAL LEADER IN EV MANUFACTURING, PRODUCTION, AND DEPLOYMENT

The aim of America’s EV policy should be to quickly gain by far the largest part of the global EV market penetration by reaching the mass market of average domestic and international consumers of high volume models. Doing this can rapidly help lower consumer costs, cut emissions, end oil imports, reduce pollution, and prompt a resurgence of domestic auto manufacturing. Specifically, the United States should set a goal of producing more than 50 percent of the global EV production—or 15 million vehicles a year–by 2030.

Fifteen years ago, the U.S. allowed Chinese subsidies to displace U.S manufacturers and dominate the global race for solar panel manufacturing—and today China owns more than (5) 60 percent of the global market. America cannot allow that to happen with EVs, which under any scenario will be an essential part of the next generation of global clean energy technology and auto manufacturing.

Electric Vehicles at scale will bring America remarkable, one of a kind benefits. For instance, EVs can dramatically reduce air pollution, which is among the leading causes of lung disease, lower life expectancy and asthma among Americans. Transitioning to EVs will also reduce America’s largest source of greenhouse gas emissions—transportation. EVs have less than half the GHG emissions of gasoline-powered cars, and are getting even cleaner every year (6). An average U.S. EV today has greenhouse gas emissions equivalent to a gasoline car getting 80 MPG (7). EVs will only get higher gasoline equivalent mileage over time.

At the same time, EVs will save U.S. consumers money because of much lower fuel and vehicle operating costs (8). The total cost of owning and operating an EV is already cheaper than oil-fueled cars (9). The U.S. average price per gallon of gasoline is $2.50 while it costs less than half that–$1.10 per eGallon–to charge an electric car, according to the U.S. Department of Energy (10).

Finally, widescale deployment of EVs will also help end America’s reliance on imported oil. Today, the US imports about 20 percent of its oil, including from non-Democratic petro-states like Saudi Arabia and Venezuela.

Gaining American global leadership in one of the world’s the fastest growing major manufacturing sectors will provide the United States a huge economic boost and create an export market for U.S. EVs around the world. Boosting the American EV industry will also bring ancillary benefits to the nation’s overall efforts for a clean-energy transition. For example, large scale EV deployment will enable the creation of a huge distributed network of electricity storage units—that is, car batteries themselves plugged into the electricity grid, especially at night. This network will allow greater electricity storage at scale that in turn will allow major electric grids around the country to integrate higher percentages of clean solar and wind energy. In essence, electrifying transport will therefore help reduce emissions from both the transport and electricity sectors, the two highest emitters in the U.S. economy.

 

THE SOLUTION: DRAMATICALLY EXPAND AND IMPROVE TAX CREDITS FOR CONSUMER PURCHASES OF ELECTRIC VEHICLES

There is no doubt America has the capacity to lead the EV revolution. America has unrivaled technical expertise, a skilled work force, and innovative entrepreneurs and investors (11). But current half-hearted U.S. tax policies on EVs are not coming anywhere near immediately seizing this massive opportunity as other countries threaten to pull so far ahead that we cannot catch up.

One powerful way to speed the revolution is through more robust tax incentives that can boost the pace of technological evolution of U.S. companies and adoption of EVs by the transportation sector as a whole.

For example, existing federal tax credits are not nearly enough to drive the change and scale of EVs that are needed to gain full benefits. The current federal tax credit system, while well intended, has so far been ineffective. It offers $7,500 for the purchase of any all-electric vehicle, but caps the credit at 200,000 vehicles per manufacture, with rapidly reduced credit amounts after that threshold. Several Members of Congress have proposed (12) extending the existing $7,500 credit with no cap per manufacturer, but do not propose changing the overall structure of the credit. These changes are highly unlikely to drive large rapid electrification of the US fleet.

What Congress should do instead is provide American consumers with much more generous tax credits for the purchase of more affordable EV models that Americans actually want and can afford, including minivans, SUVs, and light trucks.

In particular, Congress should provide a consumer tax credit that is the more generous for cheaper vehicles than for expensive ones, thereby encouraging the sale of more affordable electric vehicles. For instance, this credit could be structured on a graduated scale as follows: $7,500 for vehicles priced under $35,000; $5,000 for those under $50,000; $2,500 for those under $75,000; $1,500 under $100,000.

Opinion polls find that nearly three quarters of consumers say a tax credit would affect their decision to buy an EV, and 63 percent say a credit is an important measure to support EV adoption. However, the tax credit must be applicable to cars Americans want to buy to achieve volume and scale (13).

In addition to the graduated tax credit described above, Congress should also provide an extra consumer tax incentives for “trading-in” low mileage “gas guzzlers” for the purchase of an EV to quickly turn over fleet and eliminate the most inefficient, polluting vehicles. Moreover, Congress should provide manufacturer tax credits within each class of vehicle, including SUVs, minivans and light trucks, to drive rapid production and demand for popular models. Finally, to encourage rapid growth and large-scale production, the manufacturer tax credit should become greater for production over a certain high total threshold of vehicles produced.

The tax credits described above can go a long way toward speeding the nation’s transition to EVs while boosting U.S. EV leadership. Nevertheless, these tax credits cannot be effective if offered alone. Rather, they must be offered in concert with a robust, comprehensive agenda to accelerate electric vehicle adoption.

Crucially, the federal government and the states will need to invest in public and private incentives for building out a network of electric charging stations through much needed infrastructure modernizing legislation. Congress should also require that the federal government purchase US-made EVs for most purposes (and other alternative vehicles like Compressed Natural Gas or Fuel Cells as needed for other uses like buses and heavy-duty trucks);

The federal government could also raise Corporate Average Fuel Economy (CAFÉ) standards for an added push toward EVs. And in order to gain the full reductions in air pollution and greenhouse gas emissions, Congress will need to make sure that the electricity sector relies on increasingly clean energy sources.

America cannot afford to lose the EV race, the most important manufacturing opportunity of our time. By creating a comprehensive program to jumpstart the production and purchase of the electric cars and trucks Americans want and can afford, Congress can help the nation take a dramatic, yet pragmatic, step forward toward growing the economy, cutting oil use and consumer costs, improving air quality and combatting climate change.

ENDNOTES

1) “Electric Vehicle Outlook 2018 | Bloomberg New Energy Finance.” Bloomberg NEF. https://about.bnef.com/electric-vehicle-outlook/.

2) Niu, Isabelle. “Your next Car Could Be Electric-and Chinese.” Quartz. November 15, 2018.

3) Kane, Mark. “US All-Electric Car Sales Charted: November 2018.” Inside EVs. December 30, 2018.

4) “Top-selling Electric Cars in the United States 2017 | Statistic.” Statista. https://www.statista.com/statistics/257966/best-selling-electric-cars-in-the-united-states/.

5) Beinhart, Larry. “Why China, and Not the US, Is the Leader in Solar Power.” Al Jazeera. August 22, 2018.
6) Nealer, Rachael, David Reichmuth, and Don Anair. “Cleaner cars from cradle to grave: How electric cars beat gasoline cars on lifetime global warming emissions.” Union of concerned scientists report (2015).

7) Reichmuth, David. “New Data Show Electric Vehicles Continue to Get Cleaner.” Union of Concerned Scientists (blog), March 8, 2018. https://blog.ucsusa.org/dave-reichmuth/new-data-show-electric-vehicles-continue-to-get-cleaner.

8) Richardson, Jake. “Electric Vehicles Reduce Toxic Air Pollution – Pollution That Hurts & Kills Humans.” CleanTechnica. May 12, 2018.

9) “Electric Vehicles Have Lowest Total Cost Of Ownership, Study Finds.” CleanTechnica. February 05, 2018.

10) “EGallon: Compare the Costs of Driving with Electricity.” Energy.gov. February 9, 2019. https://www.energy.gov/maps/egallon.

11) Kljaic, Vanja. “U.S. Electric Car Battery Production Is Lacking, Says Expert.” Inside EVs. October 7, 2018. https://insideevs.com/us-electric-battery-production-lack/.

12) U.S. Senate. Jeff Merkley. “MERKLEY, HEINRICH, CORTEZ MASTO INTRODUCE LEGISLATION TO EXTEND ELECTRIC VEHICLE TAX CREDIT FOR 10 YEARS.” News release, September 17, 2018. U.S. Senator Jeff Merkley of Oregon. https://www.merkley.senate.gov/news/press-releases/merkley-heinrich-cortez-masto-introduce-legislation-to-extend-electric-vehicle-tax-credit-for-10-years.

13) “EV Statistics of the Week: Range, Price and Battery Size of Currently Available (in the US) BEVs.” EVAdoption. January 21, 2018. https://evadoption.com/ev-statistics-of-the-week-range-price-and-battery-size-of-currently-available-in-the-us-bevs/.

Ritz for Forbes, “Donald Trump’s Budget For A Declining America”

Posted on by The Progressive Policy Institute

After the president’s budget was released on Monday, House Budget Committee Chairman John Yarmuth (D-KY) called it “A Budget for a Declining America.” Unfortunately, that might be an understatement.

The Trump administration’s Fiscal Year 2020 budget proposal is a compilation of the worst ideas to come out of the Republican Party over the last decade. It would dismantle public investments that lay the foundation for economic growth, resulting in less innovation. It would shred the social safety net, resulting in more poverty. It would rip away access to affordable health care, resulting in more disease. It would cut taxes for the rich, resulting in more income inequality. It would bloat the defense budget, resulting in more wasteful spending. And all this would add up to a higher national debt than the policies in President Obama’s final budget proposal.

The most harmful aspect of Trump’s fiscal blueprint is its scheme for gutting investments in public goods that are core responsibilities of government. The administration proposes to reduce the share of gross domestic product devoted to non-defense (domestic) discretionary spending – the category of the budget that is annually appropriated by Congress and includes most federal spending on infrastructure, education, and scientific research – by more than half over the next decade. The result is deep cuts to all three of these important investments that provide the foundation for long-term economic growth.

Continue reading at Forbes.

 

 

Bledsoe for USA Today, “Trump border emergency is fake and climate crisis is real. Guess which just got funded?”

Posted on by The Progressive Policy Institute

Donald Trump funds ’emergency’ border wall but relief for victims of wildfires, storms and other climate change-fueled catastrophes must wait.

One emergency, the border wall, is fake, invented by a rogue president desperate for a political win no matter the price. Another, the climate crisis, is real, with tens of millions of citizen victims around the country. Guess which one got funded?

President Donald Trump is risking a constitutional crisis by declaring a false national emergency to fund a border wall that his own government experts say isn’t needed and won’t work, and of which he himself says, “I didn’t need to do this.”

Meanwhile, the bill Trump signed last week to keep the government open leaves out tens of billions of dollars of relief for American citizens who are victims of hurricanes, wildfires and other disasters made worse by climate change.

This should not be a shock to anyone paying close attention. Acting White House Chief of Staff Mick Mulvaney, reacting to earlier reports, last week pointedly denied that the administration would raid relief funds designated for victims of storms and wildfires to get money for Trump’s dubious border wall.

The president, who denies basic climate science and is rolling back key climate protections, would have been taking money from its victims to escape the consequences of his own manufactured government-shutdown crisis — all to build a wall that will be ineffective and even counterproductive in improving border security.

A firestorm of criticism prevented that. Yet here we are about a month later with much the same outcome.

Continue reading at USA Today.