Center for American Progress

7 Reasons to Support Comprehensive Clean-Energy Legislation

7 Reasons to Support Comprehensive Clean-Energy Legislation

Comprehensive energy and climate legislation is a vital step toward securing America’s energy future and regaining our global leadership in clean-energy technology.

Prime Minister David Cameron, left, speaks at the Clean Energy Ministerial meeting in London on Thursday, April 26, 2012, alongside U.K. Energy Secretary Edward Davey, U.S. Energy Secretary Steven Chu, U.K. Energy Minister Gregory Barker, and India's Deputy Chairman for the Planning Commission Montek Singh Ahluwalia. (Flickr/<a href=DECCgovuk)" data-srcset=" 610w, 610w, 610w, 500w, 250w" data-sizes="auto" />
Prime Minister David Cameron, left, speaks at the Clean Energy Ministerial meeting in London on Thursday, April 26, 2012, alongside U.K. Energy Secretary Edward Davey, U.S. Energy Secretary Steven Chu, U.K. Energy Minister Gregory Barker, and India's Deputy Chairman for the Planning Commission Montek Singh Ahluwalia. (Flickr/DECCgovuk)

Last week, President Barack Obama urged Congress to pass a comprehensive clean-energy bill, saying, “I once again call on Congress to send me legislation that places a market-based cap on carbon pollution, which will then drive and incent for the kind of innovation and dynamic, new, clean-energy economy that can create jobs and new businesses all across America.” The House Energy and Commerce Committee responded by considering the American Clean Energy and Security Act, H.R. 2454, a comprehensive clean-energy legislative package. This step is major progress toward building a low-carbon economy and reducing global warming pollution.

Here are seven key reasons why comprehensive clean-energy legislation is a good idea and deserves support.

1. Clean-energy legislation will create jobs by spurring investment in renewables and efficiency.

The legislation would place a cap on global warming pollution that would give companies and utilities an incentive to invest in low-carbon and energy-efficient technologies in order to minimize their emissions. These kinds of investments increase demand for renewable electricity and fuels, helping grow entire new businesses, and create jobs in struggling sectors of the economy such as manufacturing and construction.

Clean-energy investments also create more jobs than investments in traditional energy sources. A recent report from the Center for American Progress and the Political Economy Research Institute at the University of Massachusetts showed that investments in renewable energy—such as wind and solar power—and energy efficiency can create nearly four times as many jobs per dollar invested when compared to investments in oil production. These investments redirect money previously spent on wasted energy, pollution, and imported fuel toward advanced manufacturing, modern infrastructure, and skilled labor.

2. Boosting investments in low-carbon energy will help the United States regain the lead in the manufacture and sale of clean-energy technologies.

A February analysis by HSBC Global Research in Hong Kong projects that nearly 40 percent of China’s proposed $586 billion stimulus plan—$221 billion over two years and $12.6 million per hour—is going toward public investment in renewable energy, low-carbon vehicles, high-speed rail, an advanced electric grid, efficiency improvements, and water-treatment and pollution controls.

What’s more, despite using more coal than the United States, Europe, and Japan combined, China has emerged in the past two years as the world’s leading builder of more efficient, less polluting coal power plants capable of capturing and storing carbon, mastering the technology and driving down the cost.

Additionally, the European Union has committed to 20 percent renewable energy by 2020. And as of 2006, the United States had less absolute renewable power capacity than either China or the 27 member nations of the European Union. Renewable energy deployment in the United States lags behind many European and Asian nations, and meanwhile 66 other countries worldwide have committed to nationwide standards.

Establishing a market price on carbon pollution would make investments in wind, solar, and other renewable and efficiency technologies more affordable. And investing in the research, development, and production of these clean-energy technologies would help the United States regain the lead in the global competition to develop and sell these technologies.

3. Action on clean-energy legislation has critical industry support.

CEOs from some big energy and manufacturing companies realize that we must reduce oil use and cut greenhouse gas pollution or face devastating economic and national security consequences. These leaders have far more vision than the conservatives who would continue our current dangerous path.

Some of these leaders have joined together with a handful of nonprofits to form the U.S. Climate Action Partnership. Their proposal to cut greenhouse gases by 14 percent to 20 percent by 2020 was the starting point for recent House legislation.

These leaders have also voiced their support for comprehensive legislation. U.S. Climate Action Partnership member Charles Holliday, Jr., chairman of DuPont, recently testified before a House Energy and Commerce Committee hearing that, “I believe that this may be the single greatest opportunity to reinvent American industry, putting us on a more sustainable path forward… A federal climate program has the potential to create real economic growth through innovation.”

But despite the forward thinking of these and other leaders, many of their companies belong to trade associations that are vigorously lobbying Congress to reject the new direction and continue our current path. Duke Energy plans to leave the National Association of Manufacturers because of NAM’s campaign to block progress. And 10,000 small businesses petitioned the U.S. Chamber of Commerce to end its disinformation campaign and high-pressure lobbying to stop comprehensive clean-energy legislation.

4. Global warming is harming our health and the physical environment.

Mounting evidence indicates that man-made global warming is already wreaking havoc on our planet. And the economic and health impacts of a warming planet are well known—increased wildfires, more frequent flooding, species extinction, and even skyrocketing property insurance claims.

Global warming poses a major health threat. Margaret Chan, the director-general of the World Health Organisation, states, “Climate change will affect, in profoundly adverse ways, some of the most fundamental determinants of health: food, air, water.” Major population centers all over the world have already suffered from deadly heatwaves, uncontrollable wildfires, devastating floods, droughts, and insect-borne diseases.

We’re feeling these effects at home, too. In February, Governor Arnold Schwarzenegger declared a state of emergency in California due to the severity of its drought. The state faces nearly $3 billion in economic losses this year from the lack of rainfall. The state’s perennial wildfires, worsened by the drought, are themselves a major cause for concern. Research suggests that wildfires are a significant contributor to global warming by depleting carbon-absorbing vegetation while releasing more carbon emissions into the atmosphere.

There has also been an outpouring of new evidence that unchecked pollution has rapidly led to harmful changes in the physical world. Rising temperatures have caused the 18,000 year-old Chacaltaya glacier in Bolivia to completely vanish, and scientists predict that the North Pole will have almost no summertime ice as soon as 2020. The melting of polar ice is a major cause for alarm because it would cause the release of vast deposits of methane, a greenhouse gas four times more powerful than carbon dioxide.

5. Comprehensive clean-energy legislation can provide a host of economic benefits.

Increased energy efficiency

Nearly half of America’s energy powers our buildings, and too much of this energy is wasted. Making buildings more energy-efficient, on the other hand, would have many benefits, as recent studies show. According to a 2009 study by the Environmental Defense Fund on efficiency investments in Texas, efficiency investments in buildings can avoid more than 50 million metric tons of greenhouse gas emissions and avoid $17 billion in electricity bills annually by 2030. an analysis from McKinsey and Company suggests that the United States can achieve annual savings of $33 billion per year by 2030 from cumulative buildings sector efficiency improvements.

A smooth transition for energy-intensive industries

Many legislators had a legitimate concern that immediately requiring heavy energy and trade-intensive industries such as steel, cement, and paper to buy pollution permits would be an additional burden for these already vulnerable industries. And many such companies have foreign competitors that do not yet have such a pollution reduction regime. The global warming reduction program in H.R. 2454 would smooth the transition for these industries by granting them pollution permits for a limited time period at the start of the program.

Carbon capture-and-sequestration technology research and development

Technology currently exists to capture carbon dioxide emissions from coal-fired plants—which provide half of U.S. electricity —and to sequester that CO2 in underground geologic formations. The technology is not yet commercially available, however, and widespread deployment of CCS systems will not happen on its own.

Comprehensive clean-energy legislation provides incentives for companies to invest in the research, development, and deployment of how to store coal’s carbon dioxide emissions. Widespread CCS deployment—in combination with other policies to reduce emissions—could be invaluable in meeting our emission reduction goals for greenhouse gases and would encourage the export of CCS technology around the world. Nations that depend on low-cost coal to fuel economic growth, such as China and India, could become markets for this technology.

6. Clean-energy legislation requires that polluters pay.

Currently, greenhouse gas emitters can pollute the sky without paying any cost. The pollution adds to global warming, and society at large will pay the human and economic costs of the changes caused by an overheated climate.

Clean-energy legislation would close this carbon pollution loophole by requiring that emitters pay for their pollution. Large emitters would have to annually purchase a permit for every ton of carbon dioxide they release into the atmosphere. Charging companies for what was once free will create an economic incentive to produce less of it.

Nearly a third of all U.S. greenhouse gas pollution comes from coal-fired electric power plants. There is a risk with a permit system that these utilities may be tempted to pass the added expense of their pollution on to their ratepayers. We saw this happen in the European Union’s Emissions Trading System, which began by freely distributing pollution permits to large electricity generators. The companies then sold their unneeded permits, kept the money, and raised electric rates anyway. The E.U. system created a huge windfall for coal power plants while ratepayers paid more for electricity.

The United States should avoid this mistake. To limit the impact of energy costs on ratepayers, legislation could, for example, give a percentage of the pollution permits to local, regulated electric companies (local distribution companies, or LDCs). The LDCs could sell these pollution permits on the open market to emitters that must have one permit for every ton of pollution. The state public utility commission or public service commission would be responsible for requiring these LDCs to use these revenues to offset the higher electricity prices charged by coal-fired power plants that must now buy pollution permits.

7. Opponents of action would continue the status quo of doing nothing, which cost the average family a $1,000 increase in energy bills over past eight years.

Inaction on climate change is costly. Opponents of clean-energy legislation would continue the pro-big oil energy policies developed by Vice President Dick Cheney and vigorously pursued by President George W. Bush. Billions of dollars in subsidies were plowed into extremely rich big oil and energy companies, and efforts to remove these payouts were mostly blocked by conservatives. Clean-energy policies—such as a renewable electricity standard—were also blocked.

The result of these policies? Spiraling gasoline and electricity prices for families, and a nation more dependent on coal and oil. Between 2001 and the recession that began in December 2007, the typical annual American household expenditure for energy rose by $1,130.

Failing to implement comprehensive clean-energy legislation would allow these very same expensive policies to continue to damage Americans’ pocketbooks and the environment.

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