Why Good Is Not Necessarily Great When It Comes to Emissions Reduction

Reducing greenhouse gas emissions is the front line of a battle against the highest costs and worst impacts of climate change. In this context, making progress to reduce emissions is generally good news. The U.S. Environmental Protection Agency (EPA) released a report noting the U.S. greenhouse gas emissions fell 2.7 percent between 2016 and 2017. EPA administrator touted this as “further evidence of our action-oriented approach” to reducing greenhouse gas emissions. The International Energy Agency also reported earlier in the year that the United States has decreased emissions more in absolute terms than any other country in the world between 2016 and 2017.

Here’s why that’s good news, but not great news. As the Intergovernmental Panel on Climate Change recently reminded us, the world must follow a series of pathways to reduce greenhouse gas emissions in order to avoid costly damages associated with a changing climate and that many of those actions will also help us to achieve our UN Sustainable Development Goals. And while there are many pathways that technologies and policies can choose from, all of them require a very steep decline in emissions and the creation of a vastly different energy system. While small changes in emissions today can be a sign of progress, if they are not leading to one of these pathways, then they simply won’t get the job done. Much of what underlies emissions reductions in the U.S. context has to do with environmental policies of previous administrations that closed coal-fired power plants, established standards to improved energy efficiency, created incentives for renewable energy deployment, and switched from coal to natural gas in power generation. Unfortunately, there are no clear signals from this administration that it intends to capitalize on this good news and make additional changes necessary to transform our energy system in ways that will further reduce emissions. In fact, most of the deregulatory agenda the acting-EPA Administrator Andrew Wheeler touted as a source of the emissions reduction could undermine the progress made to date.

Not everything the Trump administration has done is contrary to a low carbon transition. Support for carbon capture, nuclear, renewable energy, batteries, and energy efficiency are all part of the puzzle. To date, however, nothing the administration has done on these fronts has gathered momentum and look paltry relative to the potential need for these solutions. Even on natural gas, the administration has taken steps to harm, rather than help, the chances of natural gas becoming a more viable part of a low carbon transition. The administration has attacked methane regulation; imposed hits to the competitiveness of U.S. LNG in the global marketplace through steel and other tariffs; and thrown up potential, heretofore-unsubstantiated roadblocks to more gas in the domestic electric power system over reliability concerns. Moreover, nothing about how the United States is approaching the climate challenge at the federal level allows us to leverage greater emissions reductions from other countries. Taken together, this certainly lowers the chances of making the kind of serious changes recommended by the majority of the world’s scientific community and endorsed by nearly every other country on earth. Not great news.

There is some additional good news, however. Industry has come to distrust the permanence and durability of U.S. federal regulation on climate change in an age of pendulum politics. Energy companies, which risk being caught on the wrong side of policy, law, regulation, lawsuit, or consumer preference that penalize them for underappreciating the move to a lower carbon future, are planning for a low carbon future as part of their risk mitigation strategy. As we point out in our recent report on utility strategies to mitigate climate policy risk, this is good but not great news as most of these company strategies are less ambitious than what is likely required to transition the energy system unless they operate in a state with very stringent policies (e.g., California or New York).

The other piece of good news is that other countries have decided to take leadership roles in creating markets for new clean energy technologies, driven not necessarily by climate objectives but by local pollution concerns and a desire to be competitive in the industries of the future. China dominates the electric vehicle market at present. India hopes to do the same in solar PV down the line. U.S. states and cities are also doing their best to lead by example, and the work they do today to institute carbon prices, reform regulation, and set new policy objectives will inform strategies of tomorrow for changing the energy system. These things are good too, but when we add it all up and consider it relative to the challenge, the picture is not great.

Sarah Ladislaw is senior vice president and director of the Energy and National Security Program at the Center for Strategic and International Studies in Washington, D.C.

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