WASHINGTON, Feb. 9, 2016 -- An ExxonMobil policy blog posted this week forecasts global carbon emissions will begin to drop around 2030, and by 2040 “the emissions-intensity of the global economy is likely to fall by half,” based on how many countries are cutting carbon emissions relative to economic growth today.
The oil giant credits the improving outlook to energy efficiency, a “significant transition to less-emissions-intensive energy types,” and “more use of natural gas – which emits up to 60 percent fewer emissions than coal for electricity generation – along with growth in renewables and nuclear energy.”
More detailed evidence of the impact of “de-carbonization” comes from the 158-page Sustainable Energy in America Factbook released last week by Bloomberg New Energy Finance (BNEF) and the Business Council for Sustainable Energy (BCSE). The report concludes that de-carbonization is supporting economic growth while energy costs are flat to lower. It lists dramatic results already achieved as a result of energy efficiency programs, the shift from coal to natural gas for electricity generation, and the surge in renewable energy sources including wind, solar and biofuels.
Critics of President Obama’s climate change plan charge that recent actions as part of the initiative will drive up consumer costs and choke off economic growth. These actions include limiting coal power plant carbon emissions for the first time, placing a three-year moratorium on new coal leases on federal land, tightening federal regulations for oil and natural gas drilling, and proposing a $10 per barrel tax on crude oil.
But the BNEF/BCSE report instead charts real gains from the transition toward cleaner energy. It concludes that these gains “are likely permanent shifts, rather than temporary adjustments due to one-time events.” It states that energy productivity – the ratio of U.S. GDP to energy consumed – “continues to grow, improving by 2.3 percent from 2014 to 2015 following a 1.1 percent increase the previous year… productivity has improved 56 percent since 1990, 13 percent since 2007.”
The report adds that “The U.S. economy has now grown by 10 percent since 2007, while primary energy consumption has fallen by 2.4 percent” – establishing a positive trend of “de-coupling” economic growth from energy use.
With U.S. power sector CO2 emissions at their lowest annual level since the mid-1990s, the report finds that the net impact on consumers has been “negligible to positive as prices for electricity, and fuel remained low by historic standards and customer choices expanded.”
The report shows that for the second year in a row, clean energy sources provided more new electricity generation capacity than fossil fuels by adding 16.4 gigawatts (GW) in 2015, 68 percent of all new capacity. That additional capacity included 8.5 GW of new wind power and 7.3 GW of new solar power. As a result of the additions, the report notes that “The U.S. power sector is gradually decarbonizing. From 2007 to 2015, natural gas increased from 22 percent to 32 percent of electricity generation, and renewables climbed from 8 percent to 13 percent. Coal’s share slipped from 49 percent in 2007 to only 34 percent in 2015.”
Pointing to the report’s figures for the growth in wind power and other renewable energy sources, American Wind Energy Association CEO Tom Kiernan tells Agri-Pulse that wind power is two-thirds cheaper than it was six years ago. “After installing eight gigawatts of clean wind energy last year we’re going to keep this American success story going,” he said.
Predicting that “wind energy is well on its way to reliably supplying 20 percent of the country’s electricity by 2030,” Kiernan credits the positive outlook to recent tax-break renewals providing long-term policy certainty, and to “states and utilities increasingly looking to lock in low-cost wind energy to reach their Clean Power Plan carbon reductions.”
The full BNEF/BCSE report provides a detailed breakdown of which states and which sectors of the U.S. economy are investing the most and getting the greatest returns from investing in clean energy. The report also assesses global clean energy investments. It shows that in 2015 “investments climbed 8 percent in the U.S., mostly in wind and solar,” rising from $52 billion in 2014 to $56 billion for 2015. That compares to China’s 18 percent growth from $94 billion for 2014 to $111 billion for 2015.
With the U.S. and China leading the way at 17 percent and 33.5 percent respectively of total world clean energy investment, this global investment climbed 4 percent from 2014 to set a new record of $329 billion.
The report notes that despite concerns that the plunge in oil prices could slow the growth of renewable energy, “the oil price crash could have a ‘second-order’ effect on the power mix by stimulating the U.S. economy, which could propel greater use of natural gas and renewable energy.”
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