Cleaner, cheaper energy technologies

Earlier this year, I introduced, along with 9 other co-sponsors, a straightforward bill to put in place a nationwide clean energy standard, or CES, for electricity. The purpose of the legislation is to make sure that we leverage the clean resources we have today and provide a continuing incentive to develop the cheaper, cleaner energy technologies of the future. By design, it would drive continued diversity in our sources of energy, and allow every region to deploy clean energy using resources appropriate to that region. The CES does this in a way that supports home-grown innovation and manufacturing, keeping America competitive in the global clean-energy economy. 

Here’s how it works: starting in 2015, the largest utilities would meet the CES by showing that a certain percentage of the electricity they sell is from clean-energy sources. To be considered “clean,” a generator must either be a zero-carbon source of energy, like renewables and nuclear power, or have a lower carbon intensity — the amount of carbon dioxide emitted for each megawatt-hour of electricity generated — than a modern, efficient coal plant.

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Generators with low or no carbon intensity receive credits based on that criterion. For example, renewables receive a full credit per megawatt-hour. Most natural-gas generators would qualify for roughly a half-credit, and more efficient natural-gas generators would be incentivized more than less efficient ones. A coal power plant could receive credits if it lowered its carbon intensity via carbon capture technologies or co-firing with renewable biomass. Accounting for “clean” in this way means that the cleanest resources have the greatest incentive, and that every generator has a continuing incentive to become even more efficient.

Electric utilities overall are capable today of meeting the percentage that would be required of them in 2015. Each year after 2015, they would need to sell a little more of their electricity from clean energy — by incrementally adjusting their own energy mix to become cleaner and more efficient, by purchasing clean energy from those that can provide it at a lower cost, or by purchasing credits on an open and transparent market.

As the standard increases over time, the nationwide fleet of electric generation facilities will transition naturally toward cleaner and cleaner sources to meet it. The CES sets an overall goal for clean energy, but the cheapest set of technologies to use will be determined by the free market. The rate of transition is predictable and achievable, and the rules of the road are transparent and clear. 

In addition to driving cleaner electricity generation in the power sector, the CES also rewards industrial efficiency. Combined heat and power units generate electricity while also capturing and using the heat for other purposes. These units are treated as clean generators under the CES. This will help to deploy this kind of efficiency, and provides another source of inexpensive clean energy.

For all of the CES’s benefits, there are a number of things that it doesn’t do. The CES does not limit overall emissions. It does not limit new electricity generation to meet the demands of a growing economy. The CES is also designed so that it does not cost the government or raise money for the government. 

 The CES will not hurt the economy either. Past analysis of CES policies by the Energy Information Administration (EIA) has shown that a properly designed CES would have almost zero impact on GDP growth and little impact on nationally averaged electricity rates for the first decade of the program. EIA’s analysis last year showed that a CES would result in a substantial deployment of new clean energy, and carbon dioxide reductions of between 20 percent and 40 percent in the power sector by 2035. I have asked the EIA to update their analysis to reflect my introduced legislation. I expect to have their results shortly, and plan to hold a full committee hearing to receive expert testimony on the CES in May. 

The goal of the CES is ambitious — a doubling of clean energy by 2035. I believe that there are ways of achieving this goal that are both possible and affordable, and that will yield substantial benefits to our health, our economy, our global competitiveness and our environment. I look forward to hearing from the experts on the proposal that I and my colleagues have introduced, and exploring ways to improve it and build even greater support for taking the next major step toward a clean-energy future.


Bingaman is chairman of the Senate Energy and Natural Resources Committee.