Tuesday, November 17, 2009

Clean Energy and Climate Policy For U.S. Growth and Job Creation - A New Report

A new report evaluating the costs and benefits of bold climate change and clean energy solutions claims that a strong regulatory approach will not only cut the costs of our transition to a Green Economy, but it will save consumers oodles of money.

The Triple Pundit reports:

A new report out of UC Berkeley argues the stricter the regulation of greenhouse gases, the better it is for state economies, from California to Connecticut, and everywhere in between.

The report, entitled “Clean Energy and Climate Policy for U.S. Growth and Job Creation,” argues that improvements in energy efficiency, as well as a government mandated shift away from fossil fuels, will result in increased income for Americans, and higher job growth, as less income is spent on energy and new technologies spur industry.

That pretty much echoes what we say here -- the more efficient our buildings and homes and vehicles become, the less we have to spend on energy and gasoline and the more we have to spend on everything else, from the shopping mall to the restaurant to the concert hall.

The question is -- will these savings offset fossil fuels becoming more expensive?  I'd guess that this is more likely to be the case if climate and energy policies add adequate incentives to make clean energy and efficiency sufficiently cheap -- and help people and businesses transition to new technologies, which will in turn drive the growth of these industries.

What I find interesting is the point that states in the conservative U.S. heartland -- where Congressional Representatives are generally against strong climate change and clean energy legislation -- have more to gain from these solutions than coastal states:

States in the “heartland,” aka “the real America,” actually spend more of their income on imported fossil fuels, according to the report, and thus have more to benefit from reducing their consumption.

Contrary to what is commonly assumed, comprehensive national climate policy does not benefit the coasts at the expense of the heartland states. In fact, heartland states will gain more by reducing imported fossil fuel dependence because they are generally spending a higher proportion of their income on this low employment, high price risk supply chain. Demand side policies make a bigger difference for more carbon-dependent states, and carbon reduction opportunities represent riper and lower hanging fruit.

Ultimately, it would seem that if the legislation contains smart measures that make renewable energy and energy efficiency upgrades cheap, and help farmers transition to new, more efficient equipment that doesn't cost an arm and a leg's worth of oil to operate, Midwestern states should want to support it.

But it won't possibly be that simple, will it..?

Either way, this report makes for an interesting addition to our library.

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