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Near-Term Presidential Actions for Energy & Environmental Leadership

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Near-Term Presidential Actions for Energy & Environmental Leadership Security Opportunity Stewardship PRESIDENTIAL CLIMATE ACTION PROJECT Plan B: Near-Term Presidential Actions For Energy & Environmental Leadership August 2010 EXECUTIVE SUMMARY Even if you doubt the evidence (of climate change), providing incentives for energy efficiency and clean energy are the right thing to do for our future, because the nation that leads the clean-energy economy will be the nation that leads the global economy, and America must be that nation. President Obama – State of the Union Address – Jan. 27, 2010 The most important long-term challenge facing the United States today is its transition to a clean energy economy. It also is one of the nation’s biggest challenges. Today, 84% of America’s total energy use comes from fossil fuels. But it is a challenge filled with opportunity. Deliberate progress toward greater energy efficiency and low-carbon renewable energy will make our industries more competitive, our economy more stable, our job creation more robust, and our nation more secure. If we expedite the transition, we will minimize our economy’s impact on the environment and reduce the impacts of global climate change. In 2009, the 111th Congress passed and President Obama signed the largest energy bill in American history – the American Recovery and Reinvestment Act. It included more than $80 billion of federal investments in energy efficiency and renewable energy resources. It was an important first step. Congress has failed, however, to take the essential next step: Implementing an economy-wide cap on greenhouse gas emissions and putting a price on carbon. While the most prominent climate and energy bills considered so far by the 111th Congress would be game-changers in our economy, they fall far short of reducing U.S. emissions to the levels recommended by leading climate scientists for industrial economies – 25% to 40% below 1990 emissions by 2020. As the international community attempts to deal with climate change and the other liabilities of fossil fuels, the global market for “green” technologies is becoming increasingly competitive. The New America Foundation estimates the United States ran an overall green trade deficit of nearly $9 billion in 2008 and a deficit of $6.4 billion in renewable energy technologies.i The White House Council of Economic Advisors has calculated the number of jobs that might be created if the United States tries harder to win the race. It projects that U.S. jobs related to the environment could grow 52% from 2000 to 2016 compared to only 14% for other occupations. In January 2007, the Wirth Chair at the University of Colorado Denver launched the Presidential Climate Action Project (PCAP), a foundation-funded program to identify changes in federal policies and programs that would mitigate climate change and help facilitate the transition to clean energy. In an effort to stimulate discussion about climate change and clean energy during the presidential campaign, PCAP provided suggestions to all of the candidates. In 2008, the project met with leaders of President-elect Obama’s transition team and presented a report with nearly 200 proposals for presidential and congressional action. EXECUTIVE SUMMARY: 1 PCAP’s emphasis, however, was on policies the new President could implement without further action by Congress. PCAP commissioned the Center for Energy and Environmental Security at the University of Colorado’s School of Law to identify the authorities past congresses had delegated to the Executive Branch.ii The Center reviewed 112 statutory delegations of authority and 370 executive orders related to the environment, going back to 1937. It concluded “there exists significant authority, without further action by Congress, for the President to take action by executive order to implement various aspects of climate change policy…A proactive administration with an understanding of the serious implications of climate change can make a significant impact immediately upon taking office.” Since taking office in January 2009, the Obama Administration has used these authorities to implement a substantial body of actions related to climate change and clean energy. They range from the Environmental Protection Agency’s certification of greenhouse gases as a danger to public health and safety, which triggered regulation under the Clean Air Act, to the toughest requirements yet imposed on vehicle fuel efficiency, to an executive order that will increase the efficiency and reduce the carbon emissions of the federal government. But substantial potential remains for executive action – and with the failure of the 111th Congress to pass legislation that puts a price on carbon, caps U.S. greenhouse gas emissions and establishes a national portfolio standard for renewable energy, proactive presidential leadership is more important than ever. Consequently, PCAP plans to offer the Administration a fresh list of recommendations in January 2011, at the midpoint of President Obama’s first term. In the near term, PCAP recommends that President Obama implement five ideas prior to the United Nations’ 16th Conference of the Parties in Cancun: • Work with States, tribal governments, and local governments to create a national roadmap to the clean energy economy • Declare a war on energy waste • Begin reinventing national transportation policy • Eliminate fossil energy subsidies under the Administration’s control • Establish ecosystem restoration as a climate action strategy EXECUTIVE SUMMARY: 2 1. CREATE A ROADMAP TO THE CLEAN ENERGY ECONOMY In May 2010, the National Research Council concluded “an inclusive national policy framework is needed to ensure that all levels of government, the private sector, and millions of households and individuals are contributing to shared national goals” to limit the magnitude of climate change.iii We need that, and more. We need a full partnership between federal, tribal, state and local governments to reduce greenhouse gas emissions, and a clear roadmap for America’s transition to a clean energy economy. The roadmap should include: • Specific goals, milestones and timetables for making the transition; • Off-ramps for carbon-intensive energy and on-ramps for low-carbon resources; • Procedures to better coordinate the powers of federal, state and local government;iv • Recommendations on how federal programs and policies can better help states and local governments assert climate leadership; • A uniform and credible method for scoring progress. Why is an intergovernmental partnership important? The Clean Energy States Alliance notes that states and utilities have spent billions of dollars and acquired more than a decade of experience supporting energy efficiency and renewable energy (EE/RE) programs. The Alliance has documented how “State-level regulatory policies play an important role in enhancing the overall effectiveness of EE/RE programs.”v State and local governments have the authority to influence the top three drivers of energy consumption and greenhouse gas emissions – transportation, buildings and electric power generation. States regulate electric and gas utilities, guide transportation planning and establish energy codes for residential and commercial buildings. Localities enforce building codes and use zoning and other tools to influence urban development patterns, which in turn affect transportation energy use. More than 30 states representing two-thirds of the nation’s population have implemented or are developing their own climate action plans. A similar number have created renewable energy portfolio standards. Three regional cap-and-trade systems are underway or being developed. States have created their own appliance efficiency standards, vehicle efficiency standards and fuel standards, to name just a few policy innovations.vi The state and local contribution to the energy economy can be substantial. In a process involving 16 states and more than 1,500 stakeholders, the Center for Climate Strategies has developed a portfolio of 23 key state policies that would influence 90% of U.S. greenhouse gas emissions. The Center’s economic modeling indicates that if all 50 states adopted the portfolio, they would create 2.5 million new jobs, save consumers $5 billion in energy costs, boost GDP by $134 billion and reduce America’s greenhouse gas emissions 27% below 1990 levels by 2020.vii Supported by intelligent national policies, the benefits would be even greater.viii For these reasons, in its landmark analysis of potential energy savings in the United States, McKinsey & Co. concluded the United States needs to “formulate and launch at both national and regional levels an integrated portfolio of proven, piloted, and emerging approaches to unlock the full potential of energy efficiency (emphasis added).”ix CREATE A ROADMAP TO The CleAN eneRGY EConoMY: 3 Barack Obama’s Current Clean Energy Goals* • Weatherize 1 million homes each year • Increase vehicle efficiency 5% annually • Within 10 years, save more oil than America imports from the Middle East and Venezuela • Put 1 million plug-in hybrid vehicles on the road by 2015 • Ensure that 25% of electricity comes from renewable resources by 2025 • Reduce greenhouse gas emissions 17% by 2020 and 80% by 2050 (compared to 2005) • Reduce electricity demand 15% below DOE’s projected levels by 2020 • Increase the efficiency of new federal buildings by 40% and achieve net-zero-carbon performance in all new buildings by 2030 • Reduce the federal government’s greenhouse gas emissions 28% by 2025, compared to 2008 • Reform
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