If Congress passed climate and energy legislation that strengthened the energy efficiency and renewable energy standards in the version the House of Representatives approved last June, consumer electric and natural gas costs would be $113 billion lower by 2030, and emitters would pay 4% less in compliance costs, according to an analysis released today by the Union of Concerned Scientists (UCS).
The analysis also found that stronger renewable energy and efficiency policies would avoid the need for nearly 50 new nuclear reactors and diversify the nation’s energy mix more quickly than the current bill would.
"Combining a cap on global warming pollution with robust efficiency and renewable energy provisions is the quickest, most cost-effective way to transition to the clean energy economy everyone agrees we need," said Jeff Deyette, a senior analyst at UCS’s Climate and Energy Program and author of the analysis. "The government’s own conservative data shows that a comprehensive approach is an affordable way to protect the environment. It also ensures that U.S. companies can compete in the emerging international green technology market."
In August 2009, the U.S. Energy Information Administration (EIA) analyzed the House bill, the American Clean Energy and Security Act, which included a cap on global warming emissions and a combined energy efficiency and renewable electricity standard requiring large utilities to increase their use of efficiency and renewable energy 20% by 2025. The EIA analysis showed that the House bill was affordable and achievable, but it also showed that loopholes in its efficiency and renewable energy standard would undermine any substantial growth of renewable energy.
Using the EIA energy forecasting model and its cost and performance assumptions, UCS analyzed the costs and benefits of the House bill with a stronger, 25%-by-2025 national renewable electricity standard and a separate energy efficiency resource standard requiring utilities to reduce consumer and business electricity use by 10% by 2020.
Compared with EIA’s August 2009 analysis of the current House bill, a strengthened bill would provide the following benefits by 2030:
- reduce ratepayers utility costs by a cumulative $113 billion. Households would save $51 billion, commercial business would save $42 billion, and industrial customers would save $20 billion compared to the current House bill. Increased renewable energy use would encourage competition and diversify the energy mix, leading to more stable energy prices and lower electricity and natural gas prices. Gains in efficiency would reduce energy use, which would save ratepayers even more.
- reduce carbon allowance prices for polluters by more than 4 percent. Stronger standards for efficiency and renewable energy would help low-cost technologies overcome key market barriers so they can play a larger role in reducing emissions than would be possible with carbon allowances alone. Once deployed, efficiency and renewable energy would help lower carbon prices.
- reduce gross domestic product by less than one-tenth of 1 percent. The EIA analysis of the current House bill showed that a national climate and energy policy would have a minimal effect on the overall U.S. economy. UCS found that a stronger bill would have a comparable effect.
- increase renewable electricity generation (excluding hydropower) 23%.
- increase efficiency and reduce total electricity sales 6%.
- avoid the need to build additional electricity capacity equivalent to nearly 50 new nuclear reactors.
"Watered down climate and energy policies mean watered down benefits for consumers and businesses," said Alan Nogee, the UCS Climate and Energy Program’s director of strategy and policy. "A firm pollution cap and a serious commitment to renewables and efficiency are the key elements of an effective, affordable climate and energy bill."
The full analysis is available at the link below.