Posted on September 27, 2020 by Rich Powell
An American-led strategy to create more power around the globe, and greater CO2 reduction
Too often, climate change policy is oversimplified to false choices. Renewables versus fossils, economy versus environment, 100% reductions around the world versus inaction here at home — these false choices ultimately cloud potential solutions.
Clear-eyed climate solutions must make a clean energy transition cheaper and faster while preserving economic growth and reflecting the global nature of the challenge. Pitting these against each other, as our politics has too often done for the last decade, is a climate trap we must escape.
During the first few months of the coronavirus pandemic, photos of beautiful, blue skies over New Delhi, India, and clean, clear water where fish have returned in Venice, Italy made their rounds in news stories and social media posts. Globally, we are seeing a massive 10-13% drop in carbon dioxide emissions. The International Energy Agency (IEA) estimates 2.6 billion metric tons of carbon dioxide will not be emitted in 2020, about 6% down from 2019.
But, cheering on that good news of emissions reductions is part of the climate trap. Achieving these reductions resulted from the global economy screeching to a halt because of the COVID-19 pandemic. Yet these stories are creating the long-term perception that using less power is key to clean air. Here’s the truth: we can simultaneously have a perfectly healthy global economy, create more power around the globe, and achieve the same or greater CO2 reduction.
While the speed of this decline in CO2 emissions is extraordinary, we should recall the best science tells us we need to sustain cuts like this nearly every year for decades, globally, to eventually stabilize global temperatures. Those who have long called for “de-growth,” limiting capitalism, or changing global behavior as essential to solving the climate challenge have been disproven. A global drop of 10-20% in economic activity in Q2 2020 only has us on track to reduce global emissions by 6% this year. Clearly, the solution to this global challenge is not less economic activity. We must create even more economic activity – more development, more prosperity, globally – year after year, in ways that do not emit CO2 into the atmosphere. And that is accomplished by rapidly adopting clean energy innovation – not by ending growth.
About 40% of global carbon emissions come from generating electricity at power plants and heating homes and buildings — that’s more than any other sector, including transportation or agriculture. We cannot stop generating electricity. The solution is to create cleaner power while maintaining reliability.
While our American power sector continues to become cleaner, we still have a long way to go. Conservative policymakers are working on concrete solutions which will globally impact emissions reductions, and could even boost the world economy. These solutions deal with the two great challenges before us: ensuring access to clean, reliable electricity globally to combat climate change, and responding to an aggressive rising China.
Challenge one: Global clean, reliable electricity
Let’s take a look around the globe — hundreds of millions of people in Asia and Africa continue to lack basic necessities for human development and public health linked to clean electricity, like lights in their hospitals and clean air to breathe. India has some of the dirtiest air and one of the largest unelectrified populations in the world. Despite tremendous progress, India still has 178 million people without reliable access to electricity and is home to 22 of the world’s 30 most polluted cities.
Why does so much of India lack reliable electricity? Ultimately, it costs too much. In 2018, the IEA found when Indians could access electricity, it was on average twice as expensive as in the United States, adjusted for purchasing power. And that’s for electricity that’s far dirtier than U.S. electricity. Just before the coronavirus lock-downs, India relied on coal for 72% of their electricity, while the U.S. was down to 17% — and U.S. coal plants have far more modern environmental controls. This illustrates the significant hurdle we need to achieve on cost and performance for new zero emission technologies.
Although today India boasts 100% electrification of its villages, only 7% of those homes are connected to the grid 24/7. One study showed that over 50% of villages in some provinces get less than 12 hours of electricity per day. This problem is global: in South Africa, one-third of households have access to electricity for less than half the day, and across 34 African countries, 14% of those connected have limited access too.
This problem becomes dire in a pandemic. In parts of Sub-Saharan Africa, only 28% of health care facilities have access to reliable electricity. A patient with COVID-19 is connected to an average of five electrical devices – doubles that if high-pressure oxygen or a ventilator is needed. In short, the COVID-19 crisis has proven we need reliable and clean electricity everywhere, while also generating far more power, more reliably, in many parts of the world.
Challenge two: China’s growing influence
Despite the blue skies and clear water photos, plus the trillions of dollars Congress is appropriating to tackle the pandemic, global environmental conditions are not necessarily improving.
While Americans debate incorporating the energy sector into recovery packages, China, as of July, had permitted 17 gigawatts of new build coal without carbon capture as part of its recovery.
While in the U.S. we are cementing major incentives, research, and demonstrations for carbon capture and storage technology for both our coal and gas fleets, China’s state energy planners are easing coal power plant restrictions. Last year, they brought dozens of new unmitigated coal power plants online, roughly 20% of the size of the entire U.S. coal fleet. Looking forward, they are planning about 100 gigawatts of new coal capacity within their own borders. Through the Belt and Road Initiative, China is developing or financing more than 80 gigawatts in other countries – including outdated subcritical coal power plant technology to countries with poor environmental controls.
The projected increase in emissions in developing Asian countries alone will be greater than all U.S. emissions today. So, to tackle a global climate challenge, simple logic suggests we need to go where the tonnes of carbon emissions are.
China’s climate problem is our climate problem, just like their virus problem became our virus problem. This is precisely why we don’t like the false choice that if China and the rest of the developing world aren’t doing anything to slow their CO2 emissions, then the U.S. shouldn’t either.
The coronavirus is a drag on all human activity and economic dynamism. More pandemics can spring forth from those countries, imperiling the United States and others. Similarly, the emissions directly and indirectly from China will continue to darken our skies and contribute to climate change. The rest of the world is purchasing high-emitting Chinese technologies like their coal plants in Pakistan because they are cheap. The developing world can’t yet afford the “green premium” often still required for clean energy, but the emissions are only part of the problem — China’s stronghold on international markets ever increases Chinese soft power.
The Strategy
So, how can we keep clean skies, increase power capacity and reduce CO2, in the coming decades? There are four legs to success. And America must lead.
First, we must innovate. That means developing clean technologies the world wants to buy that give America a competitive advantage. Big energy projects can’t be done in someone’s basement with a small angel investor like a new food delivery app. Similarly, the SpaceX manned rocket launch was not accomplished solely by the private sector. It took years of research and development, and the promise of Federal procurement, between SpaceX and NASA. And we must drive progress with public investments in close partnership with the private sector, with very clear accountability at the Department of Energy to produce huge cost and performance improvements.
Second, unnecessary regulatory hurdles that needlessly slow down putting energy workers back on the job quickly must be limited. Members of this committee are supporting important reforms to the National Environmental Protection Act (NEPA) and Nationwide Permit (NWP). Representative Griffith has a bill to streamline the cumbersome New Source Review process for emission reducing technology retrofits. The efficient permitting of projects is essential to the efficient use of scant taxpayer resources and to scaling clean energy deployment rapidly. We can only put energy workers of all stripes back on the job as fast as we can permit the projects.
Third, we must demonstrate how the technology works. Dozens of U.S. utilities have committed to reach “net zero” emissions by 2050. Working backward from that goal, they will need to build new zero-emitting 24/7 technology by 2035. Let’s work with them, not against them. Congress is working on authorizing bills to cost-share federal demonstration programs, incent demonstrating new technology via tax credits, and smooth the regulatory path to deploying these at scale.
Fourth, we must export the proven technology and create new clean energy markets. Everything we are innovating and demonstrating must not only have a niche in our own energy sector, but also apply to countries like Nigeria or Tanzania that are growing exponentially – and consider what they would be willing and able to buy from us.
For this fourth leg, we should establish a strategic U.S. clean global development focus with three imperatives: (1) developing clean electricity globally; (2) tapping vast export markets for U.S. technology champions – more than $100B annually for nuclear, $600B through 2040 for energy storage, and 300 large-scale projects that capture carbon dioxide at power plants by 2030; and (3) pushing back against Chinese soft power growth globally.
We are already making progress here – just this month, the new U.S. International Development Finance Corporation (DFC) removed its moratorium on financing nuclear power projects. Leveraging and reforming international institutions the U.S. government funds and directs, like the World Bank, will allow them to join us in this effort.
To address a massive global challenge like climate change, every tool must remain in the box. No country will use a single clean power technology – every country will need to find the right mix given its national circumstances, resource endowments, and pre-existing industry.
Market-based Solutions, Today
A concerted effort across the U.S. government, from the Departments of Energy and State to regulatory agencies to export financing can advance a U.S.-driven, global agenda with huge returns. Let’s start with near-term opportunities.
For example, the bipartisan American Energy Innovation Act (AEIA) remains on the Senate floor. AEIA would authorize 17 demonstration projects for advanced nuclear, carbon capture, advanced geothermal, and energy storage by 2025. Let’s pass that tomorrow. These are ready-to-build projects that would also get Americans back to work. As Congress continues working on forthcoming stimulus, or stimuli, clean energy innovation and job-creating critical infrastructure projects like these must be included.
Additionally, the Administration’s Nuclear Fuel Working Group Report recently released a Strategy to Restore American Nuclear Energy Leadership, which would boost the U.S. nuclear fuel supply chain, build next generation nuclear reactors, and coordinate our international finance agencies on strategic nuclear exports. Let’s implement that strategy and retake global leadership in the highest energy technology of all – that America invented.
Moreover, we could put this clean sky strategy at the top of the G20 and G7 agendas to build international consensus.
As these solutions continue to advance, we must always keep the end in mind. The false choices trap avoids the politically and technically realistic debate we need on climate solutions. Done right, we can advance stronger policies that commercialize the cutting-edge clean energy technologies needed to reduce global emissions as quickly and cheaply as possible. And when the next pandemic comes, as it surely will, it will face a healthier, stronger world, ready to confront it.
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