Solar could meet approximately 68% of global energy demand with other renewables making up the rest, according to a new report. A 100% renewable energy system could also create 22 million solar jobs by 2050, the study claims. Keeping global warming below 1.5 degrees C, though, would require FITs for projects up to 40 MW in capacity, auctions for bigger systems, removing fossil fuel and nuclear subsidies and providing more education and R&D and less red tape.
PV Magazine, APRIL 12, 2019 EMILIANO BELLINI
More than two-thirds of the world’s energy could come from the sun by 2050.
Solar may become not only the cheapest energy source by 2050 but also the largest, with an impressive 68% share of global power generation, according to the Global Energy System based on 100% Renewable Energy report presented this morning in Berlin.
The new study – by Christian Breyer, professor of solar economy at Finland’s Lappeenranta University of Technology, and Claudia Kemfert, head of energy, transportation and environment at the German Institute of Economic Research, written with the support of German non-profit the Energy Watch Group – describes a scenario which could solve the global climate crisis and lead to a world energy system based on renewables by 2050.
The authors of the study expect primary energy demand, including transport and desalination, to shift from being 89% fossil fuel and nuclear power based in 2015 towards an energy system in which low-cost electricity from renewables account for 90% of consumption by 2050. The report predicts high levels of electrification will improve energy savings by around 50% compared to low electrification with current practices.
The workhorse of the energy transition
As a result of massive electrification of energy and transport – and the constantly declining costs of renewable energy technologies – solar is expected to be able to meet around two-thirds of energy demand by 2050, with wind having an 18% share, followed by biomass and waste (6%), hydropower (3%) and geothermal energy (2%). That would mean renewables meeting almost all the world’s primary energy demand, up from only 22% four years ago.
In the electricity sector, PV is expected to become the largest and cheapest source, increasing its share from 32% in 2030 to 73% in 2050, with wind power seeing its stake decreasing from 43% in 2030 to 20%. The report predicts PV will reach an installed capacity of 34.8 TW worldwide by 2050, while wind will achieve 4.6 TW. “Solar PV and wind energy emerge as the new workhorses for the power and heat sectors by 2050,” the report stated.
Storage is also expected to see its share rise to almost 5 PWhel (electric petawatt-hours) by 2030 and more than 30 PWhel in 2050, with the proportion of power demand met by storage expected to rise to 18% in 2030 and 23% in 2050.
An economically feasible transition
The levelized cost of electricity (LCOE) is expected to decline slightly from €54/MWh in 2015 to €53 by 2030. “The report confirms that a transition to 100% renewables is possible across all sectors, and is no longer more expensive than the current energy system,” said Hans-Josef Fell, former German MP and president of the Energy Watch Group, which presented the study. The LCOE of the power sector, however, is expected to decrease substantially, from around €78/MWh in 2015 to around €54 by 2050.
The dominance of solar by 2050 would also result in the mass creation of new energy jobs, with around 22 million workers active in PV by the end of the first half of the century, to take the total number of employees in the global energy industry to 37 million. More than half the industry would be working in operations and maintenance.
The report’s authors have compiled a list of suggestions for policymakers to make a 100% renewable world a reality. They include: maintaining incentives for renewable energy projects up to 40 MW in capacity; holding auctions for larger projects; eliminating fossil fuel and nuclear subsidies; supporting education and R&D; and reducing administrative burdens for the development of clean energy.
100% renewables, zero CO² emissions is not a dream
The study is also said to be the first of its kind to envisage a 1.5° degrees Celsius global warming scenario with a 100% renewable energy system completely based on technologies with zero CO² emissions. “The transition in all sectors will reduce the annual greenhouse gas emissions in the energy sector continuously, from roughly 30 GtCO²-eq [gigaton carbon equivalent] in 2015 to zero by 2050,” the report’s authors stated.
The authors of the study have published in Feburary another report describing how building a European energy system powered solely by renewables was economically feasible. In a recent interview with pv magazine, Breyer explained how a 100% renewables model is not only technically feasible but also the cheapest and safest option to fight climate change.
Emiliano joined pv magazine in March 2017. He has been reporting on solar and renewable energy since 2009. More articles from Emiliano Bellini
‘There is no alternative to a world of 100% renewables’
Electrifying the global energy system with clean energy is the only way to reach the targets set by the Paris agreement on climate change and avoid the catastrophic scenarios outlined by the recent IPCC report. In an interview with pv magazine, Christian Breyer – Professor of Solar Economy at Finland’s Lappeenranta University of Technology – explains a 100% renewables model is not only technically feasible, but also the cheapest and safest option. With solar and storage at its core, the future energy system envisaged by Breyer and his team will not only stop coal, but also nuclear and fossil gas, while seeing solar reach a share of around 70% of power consumption by 2050. By that time, PV technology could cost a third of its current price.OCTOBER 17, 2018 EMILIANO BELLINI
- COMMERCIAL & INDUSTRIAL PV
- DISTRIBUTED STORAGE
- ENERGY MANAGEMENT SYSTEMS
- ENERGY STORAGE
- ENERGY STORAGE
- GRIDS & INTEGRATION
- MARKETS & POLICY
- RESIDENTIAL PV
- TECHNOLOGY AND R&D
- UTILITY SCALE STORAGE
- UTILITY-SCALE PV
Coal is not an option and there is no business case for new nuclear, when compared to solar and wind energy.
Image: flickr, Germanborrillo
Professor Breyer, the United Nations’ Intergovernmental Panel on Climate Change (IPCC) has released a report which provides a shady outlook on the future of the planet unless urgent measures against climate change are taken. In your research, you have always claimed only a world energy system based on 100% renewable energy for electricity, heating and cooling, transport and desalination can stop climate change and its disastrous consequences. Do you believe now the 100% renewables option will receive more attention?
I hope so, as we already have no other appropriate options than this 100% renewables pathway. This is not science fiction but a real world scenario that must be taken into serious consideration, unless we don’t want to commit a collective suicide. But this is not only a matter of survival, it is also the cheapest way to shape our energy future, as solar and renewables have the potential to reduce the LCOE of global power supply from €70 [$80.91]/MWh in 2015 to between 50 and €55/MWh by 2050, as summarized in the report “Global Energy System Based on 100% Renewable Energies – Power Sector“, released by the Lappeenranta University of Technology and the Energy Watch Group. The easiest part of this trajectory will be the switch to renewables of the power sector, while the hard job will have to be done for the transport, industry and chemical sectors. In the transport sector, marine and aviation will also have to go through electrification, as economically they only work with low-cost electricity, and this will come mainly from renewables in the future, particularly from solar.
In a recent report, you claim solar may become able to cover around 70% of world power demand by 2050. How can this technically become feasible?
In the report you mention, we got the result that solar PV may become able to cover around two-thirds of power demand by 2050 – around 38,100 TWh of the 55,600 TWh needed by that time, for the power sector in today’s structure – without taking into account the fact that the entire world energy system may also be almost fully electrified by 2050. However, also in this case, I am also sure that, assuming a projected total final energy demand of about 160,000 TWh, the percentage of solar would be quite the same. The full electrification of the world energy economy, on the other hand, would result in a more efficient system with lower costs. Consider, for example, that a fossil-fueled vehicle uses only 20 to 25% of the energy it needs, while the rest is lost in not usable waste heat – while electric vehicles are able to use more than 70% of the electricity for moving the vehicle.
Our applied model, it must be said, has been based on assuming ‘best policies’ for the 145 regions across the world investigated. It means that it works by taking into account that governments would be always oriented towards the cheapest and most efficient solutions, which are now already being provided by solar and renewables. Societal constraints, such as a limited area for wind energy, the PV prosumerism trend, or utilization of existing power capacities, are relevant restrictions.
Well, there are still ongoing plans for more coal, nuclear and gas power plants across the world. Why, in your opinion, are these expensive options being implemented? Is that an ideological issue or a just a backlash from the old energy world business?
It needs to be noted that there are massive vested interests of existing players, which partly explains ongoing investments in coal power plants in some parts in the world. However, massive losses and the stranded assets of coal capacities in recent years are starting to have their impact, in particular for investors increasingly avoiding such risk exposure to their portfolios. Some countries have not yet adjusted their energy plans to the latest cost figures, and thus execute outdated plans. Nuclear energy evolves more and more to an investment which is only done by countries having access to, or intending to get access to nuclear weapons, and therefore the respective knowledge, infrastructure and nuclear material that needs to be maintained and created. From an economic point of view, new nuclear power plants do not make any more sense, since a 100% renewable energy system costs less and new wind and solar power plants cost, nowadays, a quarter to a third of the cost of new nuclear plants. This is the reason why, in 2017, more nuclear reactors were permanently shut down than new construction sites started for the first time since the 1970s – it is clearly an industry in steep decline. Gas plants are still in the market, and there is still an economic rationale today. However, their function will drastically change by 2050, since at that time biomethane or power-to-gas has to be used as a fuel, and they will act more as a flexible balancing plant, quite different from today.
In your view, storage in all forms, as well as hydro, geothermal, bio and tidal energies, will have enough deployment to ensure power supply against fluctuations of wind and solar. Do you really believe thermal power plants and nuclear power stations will be completely phased out by 2050?
First of all, let me tell you that nuclear power offers no back-up at all. It does not have the flexibility needed, and for security reasons it should not be used to do that. As for gas, it is actually more efficient in terms of balancing capabilities, but we have to be careful not to use fossil gas in general –and shale gas in particular – as these are very dangerous for CO2emissions, in particular via direct emissions of methane, which is a very strong greenhouse gas. We should rather see power-to-gas linked to renewables as a concrete option.
Having said that, it is true that variable renewables such as solar and wind are not as flexible as needed, but I am also quite sure that storage and all other renewables – although bioenergy and hydro resources are limited – will provide the necessary flexibility to the world energy system. This will also depend on how much we will become able to integrate our electricity networks. I believe, in fact, that a development with less grids may only be applicable in Africa or other world regions with poor infrastructure and a solar dominated power supply. Indeed, I am firmly convinced that the energy system of the future will be built on strongly connected networks, which would enable strong exchange of electricity between larger geographical areas within a major region. For example, in Europe wind power production from northern countries may be prevailing in the winter season and will flow to southern countries when additional supply is needed, while in the summer, solar power may flow to the north of Europe from southern countries. However, our results clearly indicate that this amounts to not more than 20% of the total demand, hence we will have a highly decentralized energy system with centralized elements – we call that a “SuperSmart” energy system. With the proper flexibility ensured by battery storage and more flexible demand, the system will have no back-up problems at all.
When you say this transition is technically feasible, do you also mean financially and economically?
Absolutely. As I said before, the LCOE of global power supply will drop by more than €15/MWh by 2050, so there is no doubt, at least for the power system, that it is more than economically viable. This was recently summarized in a research article by leading energy transition researchers. As for the whole energy system, climate change is the economic trigger. If we don’t reduce CO2 emissions the costs will be much higher, as a consequence of the catastrophes we will have to deal with.
What kind of measures should be immediately implemented to favor an accelerated energy transition?
Clear energy transition targets with milestones along the way. A political push for accelerated investments in renewables. Higher public research budgets for the energy transition. More acknowledgement of citizen engagement in the energy transition, instead of hindering it. Halting investments in coal fired power plants. New gas fired power plants should be only permitted if the operators document their plans on how to shift from fossil to renewables-based fuels in the years and decades to come. No public guarantees for any new nuclear power plant, to avoid misuse of taxpayers’ money. A minimum price for CO2emissions of €30 per ton and a minimum acceleration of 5% per year – better, 8% per year – from now onwards, to the end of the century. The real societal costs for the exhaust fumes of burning processes to be paid by the operators, e.g. sulfur, heavy metal, nitrogen oxide emissions etc. A mandatory liability insurance at a realistic level for real nuclear disasters should be introduced, this is currently accounted as ‘willingness-of-risk-taking’ by citizens. Climate protection as a constitutional aim. Mandatory reporting for listed and large companies on how they comply with the 1.5⁰C target of the Paris Agreement.
Do you believe that these measures may be implemented without a negative impact for the global economy?
Hope dies last. We see ongoing negative impacts but do not react accordingly on a political level – this is a shame. Take Germany, a former leader of the energy transition – 80% of citizens would like to have a faster and better managed energy transition but the political class fails in delivering. This is an unacceptable misuse of political power, and also explains some frustration of citizens documented in elections. We need a much better performance of the political class. The citizens are willing to invest and support the way ahead, even major parts of industry are now committed, as well as the major churches, but the political class acts in a way which has more to do with a sabotage of the entire project – and that has to be changed ASAP.
In your view, solar is expected to become more competitive than wind after 2030. Why will it take so long?
First of all, I believe that comparing solar with wind and other renewables does not make too much sense any more, as we need to assess the world energy system in a holistic way. Wind will be deployed mostly in the north of the U.S., Canada, Russia, Europe and all of these countries that are not in the so-called Sun Belt region, where most of future solar energy deployments will be hosted. The strong seasonality makes the mix of wind energy and solar the least-cost solution. These two main technologies represent the perfect combination for our future energy landscape, especially if we take into account the big share that storage, which also combines perfectly with PV, will have over the next decades. Some regions have very high shares of hydropower, so they have a solar and hydro dominated system, such as in Brazil.
When do you believe storage will reach its turning point by becoming a mainstream technology, as PV did during this decade?
We already see positive business cases for storage in Germany, where around 60% of new PV prosumers have also a storage system coupled to their solar PV system. Similar trends can be observed in Australia, or California and Hawaii. So, I would say that this turning point is already here, right now. We just need more volumes, scaling up capacities. In 10 years, the global storage business will be huge, especially in connection with PV. I believe, in fact, that wind will be more dependent on grids than solar, and that storage technologies will be used more for PV applications. I also expect power-to-X – including gas, fuels, chemicals, heat, and desalination – to have a wider use.
In Germany, storage projects linked to PV are being supported by investment subsidies. Without these, the business case may be less positive.
The cost decline of battery systems will balance that. Some people do not use the support already, today. I am not much worried on that.
In a fully electrified world, EVs are expected to have the lion’s share. How do you assess the current development of electromobility in the energy transition?
Electromobility is a central part of the energy transition, alongside powerfuels for marine and aviation, and power-to-chemicals or substitution of coal by hydrogen for steelmaking. The energy transition is composed of many facets.
Do we have other alternatives to 100% renewables to save the planet?
Absolutely not. A world energy system based exclusively on renewable energies and an almost fully electrified world are our only chances to avoid further disasters. This is absolutely doable, and at lower costs than today.
Europe’s 100% renewables dream needs a flexible grid concept and more storage
A European energy system powered solely by renewables is economically feasible, according to a study which suggests decentralized energy systems operating within the framework of a stronger pan-European energy trade could reduce the cost of electricity from the €69/MWh price seen four years ago to around €51 in 2050.FEBRUARY 25, 2019 EMILIANO BELLINI
An interconnected energy system which exploits the complementary nature of solar and wind but incorporates decentralized use of renewable generation and storage could free Europe of fossil fuel power in 2050.
An energy system offering the best aspects of the energy-independent ‘prosumer nations’ and pan continental ‘supergrids’ could offer Europe the prospect of an energy system powered entirely from renewables in 2050.
That is the finding of a new study by Christian Breyer, professor of solar economy at Finland’s Lappeenranta University of Technology, and Claudia Kemfert, head of energy, transportation and environment at the German Institute of Economic Research (DIW).
In the paper Flexible electricity generation, grid exchange and storage for the transition to a 100% renewable energy system in Europe, Breyer and Kemfert claim a smart grid approach – midway between a super-grid and completely decentralized energy systems – would be necessary to help Europe to have an energy mix based on 100% renewable energy by 2050 – an ambition outlined by Breyer in a pv magazine interview.
In a previous interview with pv magazine, the head of the Center for Energy Research at the Norwegian Institute for International Affairs, Indra Overland had predicted a future world marked by supergrids connecting areas with strong renewable energy resources to those in need, offering balancing between the naturally complementary generation cycles of solar and wind and extensive enough to cater to different daylight hours. Overland added, however, inevitable geopolitical tensions would see some ‘prosumer’ states attempt to go it alone as energy independent areas drawing power from their renewables infrastructure.
Breyer and Kemfert’s new work claims a flexible energy system drawing on the best of both ideas could see the levelized cost of electricity (LCOE) in Europe fall by up to 26% from its current levels, in 2050.
Macro or micro?
The research considers two scenarios for the European energy system: one in which 20 macro-regions of Europe have separated into independent energy systems with low levels of cooperation; and another marked by strong power interconnections between the same regions and widespread adoption of energy storage combined with the deployment of renewables.
In the first scenario, Europe’s LCOE is expected to decline from approximately €69/MWh in 2015 to €56/MWh by 2050, and in the second, a 2050 LCOE of €51/MWh is envisaged. “A substantial economic benefit, through cross-border trade, is worth €26 billion per year, by trading only 12% of total end user electricity demand in Europe,” said Breyer.
The authors of the study highlighted how a decentralized power supply and more flexible generation based on storage would be necessary to reduce peak interconnection capacity, further reducing infrastructure costs. “Flexible generation can be achieved by moderately increased levels of hydropower, dispatchable bioenergy and sustainable gas based generation,” they wrote. “Interconnections, up to four times current European levels, can reduce the need for generation and storage capacities by exploiting the natural complementarities between solar PV generation in the south, and wind generation in the northwest, that result in lower overall variability.”
Breyer and Kemfert concluded their modeling may ensure an energy system based on 100% renewables can be achieved in Europe, and would be economically and technically feasible if the costs of storage and renewable generation technologies continue on their current trajectories.
“To accomplish such a transition, however, policy and support instruments should be chosen that work best at a regional level, while still adhering to the clearly defined goals of a European energy union,” the report’s authors add.
Renewable energy is being procured at historically low costs. In 2017, the most competitive power purchase agreements (PPAs) for solar and wind projects were just over $20/MWh and $17/MWh, respectively. Capital expenditures – cost to construct projects from beginning to end – for solar and wind also declined from $1.14 million/MW and $1.12 million/MW, respectively, in 2016 to $1.1 million/MW and $0.99 million/MW in 2017.
Companies have responded to deep cost cuts by betting on renewables.
In 2017, U.S. corporations signed 2.9 GW of renewable energy PPAs – the second highest year on record, according to the BCSE 2018 Factbook. More and more companies are actively seeking out clean energy to power their operations, both for their bottom-line and because it’s the right thing to do for the world. The most recent State of Green Business Report highlighted that 71 Fortune 100 companies have a public target for renewable energy, and of these companies, 21 have committed to using 100 percent renewable energy. Further, 125 companies around the world have pledged to meet a 100 percent renewable target through the coalition, RE100.
How do we build on this trend of reducing power sector emissions?
This is encouraging progress, but we still have a long way to go to ensure a resilient, sustainable future. Here are some steps policymakers can take to further reduce emissions, including, but not limited to:
- Investing in a modernized grid – Designing a smarter, more flexible grid that keeps energy costs affordable and allows for more integration of renewable energy is vital to maintaining economic growth and a sustainable future.
- Optimizing distributed energy resources – Distributed energy resources like demand response, rooftop and community solar, energy efficiency, smart appliances, and energy storage – especially when rewarded properly – can give customers more control over their energy bills and help align electricity demand with renewable energy resources.
- Driving the growth of electric vehicles – With declines in power sector emissions, the transportation sector is now the largest sourceof carbon emissions in the U.S. Currently, electric vehicles are an expanding market, and if charged with renewable energy and managed well, they have the potential to reduce greenhouse gases and other harmful air pollutants, support further investment in renewable energy, provide grid services, and save people money.
- Expanding customer options for dynamic pricing – Dynamic or real-time pricing charges different prices for electricity throughout the day based on the actual wholesale electricity costs. When designed well, these real-time electricity rates can help to integrate more renewable energy, limit the use of fossil fuel power plants, and importantly, save people money on their electricity bills.
- Ensuring equity and access to clean energy – It is critical to ensure the benefits and opportunities of clean energy are made available to all communities. If equity isn’t ensured and the necessary widespread participation in clean energy isn’t achieved, we will fall well short of our climate and energy goals.
By working on these and other initiatives, clean energy can drive further decarbonization of the power sector and create a more sustainable world. We have a strong foundation – let’s build on it.
*This blog post is based on the Executive Summary of the new 2018 Business Council for Sustainable Energy (BCSE) Factbook*
Jay Inslee has a radical plan to phase out fossil fuel production in the US
I covered the first piece, on getting to 100 percent clean energy in electricity, new cars, and new buildings, here. I covered the second, a 10-year, $9 trillion investment plan, here. The third was about how climate change would reshape foreign policy under Inslee. You can read it here.
On Monday, the fourth piece, “Freedom From Fossil Fuels,” is out. It is in many ways the most radical piece yet, and likely to be the most controversial. It is about cutting off the flow of fossil fuels from the US — “keeping it in the ground,” as the kids say.
As with the previous pieces, Inslee is not screwing around. This is a serious and deeply informed plan to phase out the burgeoning US fossil fuel industry, alongside a plan to protect the workers and communities who depend on it. As I said when I covered part two, Inslee is building a credible, policy-literate Green New Deal, piece by piece — a blueprint the next president, whoever it is, can use to hit the ground running.
There are several big items of note in the latest plan, including a proposal to put a price on carbon. Fracking? He wants to work toward a national prohibition. He wants to get rid of fossil fuel subsidies, reinstate dozens of environmental rules that President Trump reversed, step up enforcement on polluters, reject all new climate-unsafe infrastructure, and boost corporate climate accountability.
And that just scratches the surface. This is a capacious plan, requiring both executive powers and legislation. The net result would be a conscious, deliberate phasing out of US fossil fuel production.
For years this kind of supply-side policy has hovered at the edge of climate discussions. Inslee is thrusting it to the center.
Let’s walk through the five big steps of the plan.
Step 1: end all fossil fuel subsidies
The persistence of fossil fuel subsidies is an embarrassment to the species. Virtually everyone (except the subsidized industries) recognizes their folly by now, but inertia and political influence peddling have kept them stumbling on like zombies.
Among the G7 countries, the US is the worst offender, with $26 billion in direct annual government financial support to fossil fuel industries (and that was calculated before Trump’s tax cuts, which dropped another $25 billion in their laps).
Inslee wants to claw back all those subsidies. That includes reversing a variety of federal tax loopholes, raising royalty rates for fossil fuels on federal lands, and “ending institutional federal support for fossil fuels,” a broad category that mentions, among other things, “directing the Secretaries of Defense, Energy and the Treasury to evaluate and report on the current and historical costs of protecting oil supplies around the globe.”
(It also includes one of my favorite little side bits: “transforming the Department of Energy (DOE) Office of Fossil Energy into the Office of Industrial Decarbonization.”)
Step 2: end federal leasing and phase out fossil fuel production
Trump has done everything he can to accelerate the exploitation of fossil fuels on federal lands and waters. Inslee would do everything he can to end it.
So the first piece here is phasing out fossil fuel production on public land. Among other things, that would include a day-one executive order banning “all new fossil fuel leasing on federal lands and offshore waters, including coal, oil, gas, oil shale and tar sands.” Then Inslee would instruct the relevant federal agencies to “utilize all existing authorities to cancel and refuse to extend existing fossil fuel leases.” Then he would work with Congress on a permanent ban (oh, and reverse Trump’s shrinking of federal monuments).
That would be, to say the least, a big deal.
The second piece is phasing out fossil fuel production more broadly. Inslee would establish a “Presidential Commission on Energy Transition” (including the secretaries of several federal agencies) that will be “tasked with identifying and setting in motion the implementation of federal policies to phase out domestic fossil fuel production.” The commission will have a special focus on a “just transition” for fossil fuel workers and communities.
This piece also involves this list of possible policies, which is so on point I just have to reproduce it:
[M]andatory set-backs from private property and targeted locations (e.g. schools, hospitals, public parks, etc); outright bans on the most-destructive practices like mountaintop-removal coal mining; the buying out and decommissioning of fossil fuel assets; working with states to restrict fossil fuel corporations’ use of eminent domain as they seek to build new infrastructure across private property; and strengthening consideration of the social climate costs associated with fossil fuel production across federal permitting agencies.
Any of those would be a big deal! (And this is one part of one part of one part of Inslee policies, yeesh.)
The third piece is the just transition. There are tons of elements to this, among them shoring up the retirement, pension, and health care benefits of retired and retiring fossil fuel workers, providing “income support and educational stipends” to fossil fuel workers, creating a “Re-Power Fund” to invest in transitioning communities, creating a “Restoration Fund” to train workers and put them to work in ecological restoration, strengthening labor and bargaining laws, and conditioning all federal clean energy investments on high labor standards.
And the fourth piece? “Ending fracking.” Period. That will mean working with Congress on a national ban while taking other executive and legislative steps in the meantime to tighten health, environmental, and safety regulations.
Step 3: hold polluters accountable
And here is the long-awaited price on carbon.
Inslee proposes a “climate pollution fee” — none shall call it a tax! — to be levied as far upstream as possible, “applied initially in key economic sectors in which it can have the most effective impact.” (I’m not sure what that means exactly, but experts generally agree a carbon fee would have the most initial impact in the electricity sector.) The fee would cover carbon dioxide and also other greenhouse gas “super-pollutants” like methane.
Interestingly, Inslee does not specify an initial level or a rate of increase, saying only that the fee would start low and rise aggressively.
As for the revenue, it would “provide dedicated support for frontline and low-income communities in addressing the impacts of climate disasters” and fund “environmental quality protections and economic development.”
Lots of economists prefer a “revenue neutral” carbon tax, in which the revenue is automatically returned via dividends or tax cuts. I’m glad Inslee hasn’t adopted that idea. He frames the carbon fee just as it ought to be framed: as a way of funding some of the good things he wants to do. Not the center of the plan, or even the center of this part of the plan. Just another provision.
To protect “energy intensive and trade exposed” (EITE) industries, Inslee proposes a “carbon duty,” effectively a carbon border tax on imported goods. (Some scholars doubt whether such a thing would be legal or workable under international trade rules.)
Also on the theme of holding polluters accountable, Inslee proposes strengthening and better enforcing a wide range of environmental rules and regulations. Fellow Clean Air Act obsessives will want to dig into this section — Inslee effectively wants to use all the CAA powers that have been proposed to address carbon, including Section 111, NAAQs, and Section 115. I suspect the Trumpified Supreme Court would have something to say about that.
Step 4: reject all new fossil fuel infrastructure
There are four pieces to step four. (I know. Bear with me.)
The first is a new “climate test” that would govern all federal investments, to ensure that they do not work against Inslee’s broader climate goals. There are lots of details about the different agencies that would apply it, but the result would be the rejection of new fossil fuel infrastructure and the revoking of many existing permits — Inslee specifically mentions the Dakota Access and Keystone XL pipelines.
The second is to restore and respect the ability of local and tribal communities to control their own land and make their own infrastructure decisions. It’s worth calling out this bit: “the depredations upon tribal land, water, and people by proponents of oil pipelines — like the Dakota Access Pipeline — demand a new direction in federal policy that recognizes the heritage and the human rights of indigenous communities.” Indeed!
Inslee would reverse Trump’s efforts to preempt states and local communities and also work to overturn the Federal Energy Regulatory Commission’s ability to force states to accept natural gas pipelines.
The third is stopping fossil fuel exports by restoring the crude oil export ban, working to make it permanent, and working to place similar restrictions on the export of other fossil fuels like coal and liquefied natural gas.
And fourth is using the federal government’s powers to accelerate the shift away from oil, including through procurement (the government is an enormous consumer) and other such fun stuff as requiring all federal rest stops to have high-voltage vehicle-charging stations. (Also: “a new requirement that every commercial fueling station must also provide electric vehicle charging services.”)
Step 5: improve corporate climate transparency
As climate change intensifies, corporations face risks both from extreme weather events and from the climate policies that might be passed to address them. With a few exceptions, most big, carbon-intensive companies are not transparent about those risks, making it difficult for shareholders to make informed decisions and investors to rationally allocate capital.
Inslee proposes a wide variety of ways for the federal government to increase oversight over climate pollution and risk, everything from new Securities and Exchange Commission commissioners, rules, and standards to new bank lending transparency requirements. These get pretty far into the weeds — “reforming reserve-based lending and debt-restructuring rules,” anyone? — but they have the potential to have some of the most significant long-term effects.
Here Inslee specifically raises the possibility of a “climate change-driven financial crisis” and offers a long list of acronym-laden suggestions to help avoid it (the FSOC, CFTC, and NGFS all play their role).
Step 6: make this plan into the official Democratic platform
So there you have it: part four (of five? six?) of Jay Inslee’s climate plan, which, like parts one through three before it, alone contains more detail and ambition than the entire climate platforms of the other Democratic candidates combined.
Specifically, in this part, Inslee is taking the “keep it in the ground” passions of the climate movement and channeling them into a comprehensive policy plan. This goes beyond run-and-gun fights against every new proposed pipeline; it’s about systematically phasing out fossil fuel production on the schedule set out by the Intergovernmental Panel on Climate Change.
It’s simply not coherent to accept the IPCC deadline — global decarbonization by midcentury — and argue that the US should go on being the world’s biggest producer of oil and gas. We are producing enough new carbon to cancel all the good we’re doing with demand-side policy. Just because that carbon might not be burned in the US doesn’t mean the US won’t suffer from the effects.
Getting serious about climate change means getting serious about phasing out fossil fuel production. Here, once again, Inslee is taking the lead in showing how it can be done.