Unlocking markets will unlock a cleaner future
The United States has lowered emissions by 14 percent since 2005. Much of this is credited to the natural gas boom, which provided us with abundant, affordable and cleaner energy. However, with natural gas production beginning to level off, it is important that the United States find other ways to reduce emissions that, like the natural gas boom, will also provide economic opportunities for American workers.
Not only are U.S. emissions going to begin to level off, but they only account for a fraction of the global climate challenge. U.S. carbon dioxide emissions only account for 15 percent of global emissions. For these reasons, innovation and making clean technology cheaper abroad must also be at the forefront of our climate solutions.
With these concerns in mind, the American Conservation Coalition released a new climate plan called the American Climate Contract. Unlike others, this plan is rooted in real solutions that are politically feasible and actionable today. The contract is built upon four pillars of action, but a huge theme of the contract is harnessing the power of the market to achieve lower emissions — something that has the power to unlock clean energy in droves.
Much like the American Climate Contract, Citizens For Responsible Energy Solutions released a market-based climate plan called Clean Energy Forward. Plans like the American Climate Contract and Clean Energy Forward capitalize on our strengths as a capitalist nation to achieve better climate outcomes.
How exactly can markets achieve lower emissions? The answer is multi-faceted and the possibilities are quite broad. Deregulated energy markets are a huge step toward achieving this. Most state energy markets are monopolistic, giving power (pun intended) overproduction and transmission in a given area to one utility company. The result is that energy consumers have no choice in where their energy comes from, what energy sources it is or how much they pay.
In states like Texas, however, that is not the case. Almost every Texas energy consumer is able to choose where their energy comes from, what type and are able to choose from a range of price options. The result of this deregulatory move by the Texas legislature in the early 2000s has been a boom in clean energy production, a sharp decline in coal production and consumers still pay far below the national average for their energy. Contrasting this with California, where energy markets are still very regulated, is profound. Californians pay some of the highest prices for energy in the country while producing about as much renewable energy as Texas.
Another major key to unlocking a cleaner energy future with markets is fixing the regulations and subsidy structures around energy production and research. For example, nuclear power is the largest carbon emission-free energy source in the U.S. Also, nuclear energy regulations are arcane and burdensome to energy developers. Taking 10 years and many millions of dollars to even be approved for a new nuclear project deters investors and doesn’t lead to positive outcomes.
This is also a challenge facing other clean energy sources, such as hydroelectric. If we were to streamline energy project approvals and update the energy regulations for hydro, nuclear, wind and others to reflect the 21st century, we could see a major increase in clean energy production coupled with a drop in energy costs and easier worldwide deployment of innovation.
A third major point when discussing curbing the effects of climate change is refocusing research and other subsidies to solutions that show more promise. Energy subsidies, fundamentally, should not last forever. They are a useful tool for breakthrough technologies and reducing costs of promising energy solutions, but there comes a point where enough is enough. By removing subsidies that aren’t producing a high return, such as rooftop residential solar panels, and refocusing this money on things such as advanced nuclear, carbon capture and storage and more, we can better spend our tax dollars, save billions and build an energy future that is more competitive and cleaner.
The United States has long been a world leader in innovation and entrepreneurship. Plans like American Climate Contract and Clean Energy Forward identify these strengths and seek to utilize them. By embracing the innovative, entrepreneurial spirit inherently present in the fabric of our nation as a means of developing new energy technology and 21st century infrastructure, we can lower emissions at home and abroad while also growing the global economy.
It is time that we unleash our strengths as a nation and use them as important tools to tackle the climate challenge.
Nick Lindquist is the national policy director for the American Conservation Coalition (ACC).