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Colin Chilcoat

Colin Chilcoat

Colin Chilcoat is a specialist in Eurasian energy affairs and political institutions currently living and working in Chicago. A complete collection of his work can…

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Climate Action Could Save $250 Billion Per Year In 2030

Climate Action Could Save $250 Billion Per Year In 2030

As the future of the Clean Power Plan (CPP) hangs in the balance, so too do billions of dollars in savings. Actually, to unlock the big bucks, we’ll have to go a step further.

If the U.S. holds to the two-degree warming path – a more ambitious target than what CPP proposes – the near-term national benefits are assessed at approximately $250 billion per year by 2030. The valuation, conducted by researchers from Duke University and NASA, adds to the growing pile of literature that suggests climate change mitigation is more than just a moral obligation; it’s an economic bonanza waiting to happen.

Of course, this presumes we care about the negative externalities to the fossil fuel economy – that is, the societal and environmental costs that occur external to the market. That’s where a majority of the early savings are; and that’s why action has been so slow to materialize. Related: This Might Be A Multi-Billion Opportunity For Oilfield Services

More specifically, deep transportation and energy sector emissions cuts of about 40 percent from current levels by 2030 could prevent nearly 300,000 premature deaths annually. Additionally, some 15 million lost adult work days a year would be saved and roughly 29,000 asthma-related trips to the hospital avoided. Regarding energy sector employment, a high-renewable replacement scenario could net nearly 3 million long-term jobs. The solar industry is already creating jobs at a rate 12 times faster than the rest of the economy. Longer-term – and assuming broader emissions reductions take hold globally – benefits could exceed implementation costs five- to ten-fold. Related: $32 Billion Loss Forces Pemex To Downgrade Offshore Ambitions

Concerning implementation costs, it’s important to distinguish CPP from the heretofore-discussed study, which assessed emissions reductions of roughly 80 percent by 2050. Speaking on the latter, implementation costs for a fairly balanced mixed generation system of renewables, nuclear, and natural gas with carbon capture and storage are on the order of 1 percent of GDP annually, though a majority of the incremental energy systems costs are borne after 2030. For comparison’s sake, one altogether different and entirely renewable zero-emission plan has an estimated price tag of $14 trillion, or roughly $400 billion per year to 2050. While robust, both are well within the technological and economic realm of possibility. Related: Oil Tankers Shun Suez Canal In Search of Cheaper Route

The comparatively modest CPP carries estimated costs of $7 to $9 billion per year, offset by annual public health and climate benefits in the range of $55 to $93 billion. Again, the savings are mostly external, and less tangible than some of the obstacles like supply-side employment changes. Ultimately, CPP’s particulars won’t matter, at least not for some time. The Supreme Court stay is unlikely to be resolved prior to 2017, and, while the ultimate fate of CPP will serve as a statement on the direction we want to take our energy revolution, CPP itself is attending, and not leading in that role.

Undoubtedly, the U.S. is already well on its way toward significant change. Driven largely by progressive actions on the state level and, increasingly, purely economic considerations, renewable energy installations are already outpacing those of fossil fuels. Actually, more than half of all new U.S. utility-scale solar installations in 2016 will be added above existing commitments set across 36 states’ Renewable Portfolio Standards. In the aggregate, the extensions of the Production Tax Credit and the Investment Tax Credit will bring about greater changes to utility-scale generation than CPP could’ve hoped for alone.

It doesn’t have to be CPP; it could be a revenue-neutral carbon tax. The point is, there are vast economic and public benefits to be had, but only if we accept the writing on the wall.

By Colin Chilcoat of Oilprice.com

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Leave a comment
  • Lee James on March 06 2016 said:
    I agree that a revenue-neutral tax (or fee) on carbon is needed. As it is, fossil fuel profits are privatized, while too many pollutants affecting health, clean water and climate are socialized by passing on costs to somebody else, including future generations.

    Pricing carbon is a predictable way of doing business. It can go easy on citizens and business if it is a regular, known fee and is gradually increased each year. Such a fee is no cure all, by itself, but paying closer to the full cost of doing business is the conservative thing to do. Otherwise, we dump pollutants "for free," and do not pay what it really costs us to burn fossil fuel.
  • Jim Decker on March 07 2016 said:
    You get what you pay for. These days, the U.S. government is paying for "studies" proving the false premise that AGW exists at all and will cause some irreparable damage to the environment. The only way to have a technical career in the government (including any University or private organization that seeks grants) today is to publish some sort of nonsense about AGW. Of course, "studies" will be designed to get publishable results.

    Science was once about discovering the truth. Today, we have taken a huge leap back to medieval times when scientists dared not speak the truth about the solar system for fear they would be sentenced to hell at death. Today, the sentences result in quicker "justice".
  • James Rust on March 08 2016 said:
    Complete baloney. The CPP costs rate payers, has no effect on climate change according to climate model computing, and benefits crony capitalism. All these studies showing catastrophic global warming from burning fossil fuels are funded by the Obama Administration and follows the October 5, 2009 Executive Order "Federal Leadership in Environment, Energy, and Economic Performance" that commands all federal agency and contractors to back President Obama's energy policies.

    Trillions are wasted and tax payers are taken to the cleaners.

    James H. Rust, professor of nuclear engineering
  • Luis armiento on April 06 2016 said:
    Dr. Rust: Why don't you defend Nuclear Energy instead of attacking the government (Reactors of XX generation with less risk). You are discussing political issues, no technical aspects. Global Warming is a reality.
  • George Roberts on April 11 2016 said:
    "Science was once about discovering the truth. Today, we have taken a huge leap back to medieval times when scientists dared not speak the truth about the solar system for fear they would be sentenced to hell at death."

    It is the greatest conspiracy in the history of Man. Hundreds of scientific organizations, tens of thousands of papers, all wrong. All those scientists with their magic decoder rings and secret handshakes, going to hidden meetings to plan what doctored data to use next.

    Or, maybe it is just another branch of science which started in the 19th Century, with the work of Fourier, Tyndall and Arrhenius, before there was the UN, the NWO, the EPA, chemtrails, Obama, HAARP, Gore, Agenda 21, the Moon landing hoax and those who are after our precious bodily fluids.

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