[updated January 2018]
This blog series is an effort to present some thoughts on how the U.S. and other nations could limit the increase in global average temperature to 1.5 C. My goal is to spark a conversation on this critical issue.
Part 2 of a 3 part blog: Stopping climate change at 1.5 degrees: what will it take?
In Part 1, I discussed what it would take to stop climate change at 2 degrees, both in terms of technologies and in terms of policies. I noted that the most important overarching strategy, both in the U.S. and globally would be energy efficiency, where policies will cut energy bills and prices, create millions of new jobs, and help overcome the economic downdrafts that led to the recession of 2007-9, from which half of Americans have never really recovered.
Renewable energy also plays a dominant role.
This blog continues the thought exercise of what additional strategies, both on energy efficiency and on limiting other greenhouse gas emissions, are needed to meet the 1.5 degree stretch goal set at the Paris conference.
“Pursue efforts” does not mean “consider efforts” or “pursue thoughts”: it is more pro-active than that. And if we find, as this essay will show, that these efforts can allow us to meet the goal, or at least come very close, we may be inspired to move forward with them more quickly.
Although it would require more detailed analysis to identify the exact pathway to limit warming to 1.5 degrees, we can start by looking at the most challenging problems with the 2-degree scenario and identify how we would solve them. This simplified approach may be more valuable than the detailed analysis, since the energy modeling for such an ambitious scenario depends on assumptions that are not analytic, but rather are based on judgments as to what is politically feasible and how fast decisions can be made and implemented at scale. These are not things that can be modeled or forecast: they are tough decisions that we will have to make.
The ideas explored next are discussed in a way that will allow an analyst to design quantitative scenarios; however this essay does not undertake to do so, in part because a specific roadmap of what technologies need to be deployed in what areas is not necessary. If the policies are designed in a manner flexible enough, they will allow markets to get us there more cheaply and easily, using a different mix of technologies.
This essay will map out the path to 1.5 degrees by starting with some major opportunities that were ignored or downplayed in essentially all of the 2-degree scenarios. Of course, the first course of action is to simply accelerate the deployment of the 2 degree scenario technologies, such as efficient appliances and vehicles, buildings that use so little energy that it can be generated on-site with solar panels, wind and solar energy, and electric vehicles.
These policies will cause economic gain, not pain, for most people and businesses, who will not notice the difference except to the extent that they have new and profitable business opportunities and reduced household expenditures. They provide a new answer to the important question: "How can a nation produce well-paying new jobs that do not require graduate-degree skills and are well distributed across the country, including rural areas as well as cities?"
Economic development using broad-brush measures such as tax or interest rate policy has not generally been successful: if it were, every country and political subdivision in the world would do it. But the economic policy community has not paid much attention to detailed, highly targeted approaches such as energy efficiency. As shown in Part 1, weak energy efficiency policy following the oil crises of the 1970s led to a sudden stagnation of median income. It is not unreasonable to believe that assertive energy efficiency policy can reverse that trend and restore the pattern of growing income—both from the consumer and a jobs perspective—such as characterized the American economy and most other advanced market economies prior to 1973. The jobs analysis cited above supports this hypothesis.
So, while what follows may be framed as an environmental protection initiative, it equally well describes a nationwide program of geographically distributed economic development and jobs creation.
Sooner rather than later
In addition, a more stringent emissions target means that we need to look more closely at timing. These issues have not generally been addressed in 2 degree scenarios either because of a perceived need to be “conservative” (the word is in quotes here because allowing the climate to warm by as much as 2 degrees is a fundamentally risky, or non-conservative, goal) or simply by ignoring some of the opportunities due to a lack of research budget or effort by the report writers or due to gaps in the published literature.
Climate pollution is cumulative: it doesn’t matter much how many tons of carbon equivalent we emit by 2050 but rather how much we have emitted during the whole of the next 33 years. An approach to 80 percent reduction along a straight line path will lead to more cumulative emissions than front-loading the savings. So a key to stopping at 1.5 degrees rather than 2 is acting fast, since delaying action will be more costly both in terms of cumulative emissions and in terms of money.
What about that last 20 percent?
For the 2-degree case, the goal for the U.S. is to reduce CO2 emissions by 80 percent by 2050, as discussed above. What accounted, then, for the remaining 20 percent? The key problems were natural gas use in industry, and petroleum use in road and air transportation; there were also issues with reducing the emissions of non-carbon greenhouse gases.
Going below the 2-degree case will also require an expanded effort on the sequestration of carbon in natural systems. Reduced emissions and increased sequestration of emissions from soils and forests can significantly offset remaining emissions from combustion of fossil fuels. So these areas are the ones on which we focus.
Although 1.5 degrees is much more of a challenge for energy planners than 2 degrees, it is still very much doable. But meeting it will require a lot more ambitious policies, including those discussed next.
Since climate pollution is cumulative, and we are already slightly beyond 1 degree, stopping at 1.5 degrees means reducing cumulative global emissions by about half compared to 2 degrees. (Because if you want temperature increase to be only ½ of a degree below today’s level, that is half the emissions of a 1-degree rise.)
This reduction has not been allocated across countries, but one way to do it would be to start with national plans to stop warming at 2 degrees and then cut the cumulative emissions by half. This is what this essay does for the United States in the next section.
A key difference between the 1.5 degree scenario and the 2 degree scenario is that efficiency is even more important to limit warming to 1.5. Efficiency can be deployed faster than any other zero-emissions technology. In the 1.5 degree scenario, front-loading our efficiency and automobile travel reduction policies is critical because the electricity and gasoline we avoid is dirtier than they will be in the future when more renewables are developed and when fuel economy of cars is higher, judging from the predictions of the 2 degree scenarios.
Additional Opportunities: 6 New Programs
These programs focus on areas where the least analysis has been done, meaning that many opportunities for savings were left unanalyzed and off the table, and where the emissions over the next 35 years are high. We focus also on actions that can be taken promptly. The discussion will show how these new initiatives complement the policies already needed to get to 2 degrees, as well as complementing each other.
Of course, we should also deploy efficiency faster and more deeply than we do in the 2 degree scenarios, and expand and accelerate the use of wind and solar and their associated demand response infrastructure to better integrate intermittent renewable resources into a grid where more and more of energy usage can be schedule to match the availability of renewable energy.
This essay suggests six areas where policies could be developed or strengthened where the potential savings are understated in current 2 degree scenarios, including the NRDC analysis. These savings are additional compared to those in the NRDC report. If we spent more time to look, we will find that there are far more opportunities than this in real life.
1. Fast, Deep Retrofits of Buildings
Buildings account for more than 35 percent of climate pollution in the U.S. It is possible to cut energy consumption in buildings by typically 50 percent for commercial space and 40-50 percent for residential using moderate cost measures that pay for themselves even without considering environmental and health benefits. Further savings—to the point of achieving net zero energy consumption—are technically feasible and financially reasonable in many cases.
We already know how to incentivize virtually all homes to undertake these deep retrofits, and to do it in just 4 years (a year for planning and 3 years for implementation), because we have already done them as pilot projects. These pilot programs were operated on the scale of a small community, so it requires more logistical efforts to scale them up to a national level. However, the scale-up does not have to occur overnight. It should not take more than a few years to construct new insulation and window factories, to upgrade the efficiency of manufactured climate control equipment, etc., so that only the most efficient of the current product line are produced in numbers, and to train workers who used to build new homes ten years ago to retrofit existing ones next year.
These successful retrofit experiments involved very high levels of financial incentive, but there are reasons to expect that the incentives could be reduced drastically over time.
This essay therefore proposes to retrofit all existing buildings by 2030, using market-based approaches that reward higher percentage savings more generously, and that set minimum required levels of savings (say, 25-30 percent). The reason to choose a goal of 2030 is that we want to create sustainable jobs for the contractors performing the work and the suppliers of efficiency products and solar energy. If we remodeled all buildings in 5 years, we would create a boom and bust cycle. But if we take 15 years, and have a market-enhancing structure, the level of savings will increase over time and we will have the opportunity to return to the first buildings after 2030 to participate and find additional savings.
Almost All of These Buildings Should Be Retrofit by 2030
Raising the capital for this program would not be difficult, as one of the policies that would be required—reforming lending to account for the cash-flow savings from energy (and location) efficiency—would allow them to be financed through conventional mortgages, and the scale of the increase would be roughly equivalent to restoring the new-homes market to where it was before the crash.
No other technical study, to our knowledge, has proposed such a fast or deep program. Many other analyses of this topic project only 15 percent savings by 2030—only about a third of what is being proposed here.This roughly tripling of energy savings compared to other studies produces a disproportionately large reduction in emissions, since the electric grid is a lot dirtier from now till 2030 than it is projected to be from 2030 to 2050. And if we are trying to limit concentrations of greenhouse gases, which are cumulative, fast reductions are especially important because we assure that the worst performing buildings will not continue their high level of emissions for more than 15 years.
This essay’s proposal has strong non-energy benefits: the worst-performing sector of the economy over the past decade has been housing. Many jobs have been lost as the number of new homes constructed struggles to reach one-half the level it was at before the bubble and crash of 2008-09. We have the skill set in the labor force to do the work, and the economy would benefit from deploying it. The result would be about 500,000 net new jobs, disproportionately skilled blue collar jobs, which occur where people already live. Little or no geographic dislocation would be required.
This initiative would also offer the largest relative benefits to the middle class, renters, and the poor. These groups suffer more of the consequences of poor thermal comfort and poor indoor air quality, and pay a larger proportion of their incomes for utility services.
We can also find additional savings from better operations and maintenance, and other behavioral programs, especially for commercial buildings. Immediate savings of from 15 to 30 percent above and beyond those from physical upgrades are easily and cheaply achievable.
2. Smart Growth and Shared Mobility
Smart growth refers to the design of neighborhoods and transportation systems such that less driving is required. Smart growth neighborhoods can allow families to get where they want to go with only 1 car, or with none, rather than owning 2 or three, so they save lots of money—around $10,000 per year.
Public Transportation and Transit-Oriented Development Can Cut Emissions and Save Money
Constructing new neighborhoods takes time, but adding infill development to existing neighborhoods is faster, and improving transportation infrastructure is still faster. New bus lines, pedestrian paths, bike lanes, etc., take only a few years. And one of the fastest opportunities, shared mobility, can be implemented almost immediately. (And it is beginning to happen just from market forces. What policies do we need to enhance it and how much could it save? Would we want to require Uber, etc., to offer carpool travel to all users, for example, or to make it the default choice on their app’s?)
Smart growth and shared mobility can also reduce emissions that would otherwise occur as we decline to build new roads, parking spaces, etc., which would be avoided by smart growth. Parking infrastructure reductions alone (there are currently some 4-8 parking spaces in America for each car) would save as much emissions as taking 10% of cars off the road. These savings would show up as industrial energy use reductions, which are a major issue for emissions limits.
The issue with climate studies is first, that most of them ignore smart growth and focus exclusively on better vehicles and cleaner fuels. And the few that do consider smart growth make timid assumptions about how quickly and deeply urban designs can change. But market trends now favor smart growth even as lending policy (“drive till you qualify”) and zoning laws still encourage sprawl and require parking to be provided and generally offered for free. With plausible policies, similar to those already adopted with bipartisan support in California, it is reasonable to foresee a scenario in which essentially all new housing, on net, is built in smart growth circumstances, either by adding density to older neighborhoods or developing new ones
This essay does not attempt to estimate how much farther we can go in travel demand reduction than previous studies for many reasons, including the unreliability of the models used to project “business as usual” and the problematic question of defining what “as usual” means. And quantifying it would not be useful on a national level in any event, since policy actions take place primarily at the local and metropolitan levels, where in some cases planners strive to meet quantitative targets on automobile vehicle miles traveled or on carbon emissions. But the additional savings resource is substantial.
These recommendations sound bolder and thus less realistic than they are, primarily because the efficiency literature did not address location efficiency until very recently—in the past, policies that led to less driving were considered to be conservation behaviors rather than efficiency. But now we see that the primary trends we need to limit climate pollution are already happening EVEN IN THE FACE OF CONTRARY POLICIES. People in the Millennial generation are increasingly choosing to live in walkable neighborhoods and are driving less than their parents did, even when policies still encourage car dependence. They are making these choices in cities that previously did not even offer such choices. Shared mobility is booming even where the companies providing it are restricted by regulation from expanding as much as they would like.
Typical 2 degree studies also fail to account for potential reductions in intercity automobile and air travel by modal shifts, and this also represents a reservoir of additional savings.
3. Strategic Energy Management in Industry
Virtually all studies of industrial savings potential start at the level of widgets (better boilers, variable speed motors, etc.,) and work up. They fail to account for major changes in process, or for incremental improvements in O&M procedures. Strategic Energy Management (SEM) is a standard for organizational management that promotes continual improvement in both facilities and O&M and directs management to provide sufficient resources to staff to save ever more energy.
Since there is not wide experience with this concept, it has not found its way into climate emissions mitigation studies. But the limited cases where it has been used, manufacturers achieved large savings in the initial years, and one company reports 4.5-6% annual gains for 10-30 years. And these savings were achieved without:
- Looking at fundamental process changes (because of a lack up budget for such actions—something that would need to change under an SEM scenario),
- Considering savings in the supply chain, and
- Counting renewable energy production. (Several major companies have begun to purchase renewable energy sources to cover 100% of their energy loads.)
SEM creates jobs in several different ways. First, the process of implementing it requires energy management professionals, both in-house and often consultants, and entails more jobs for operators doing more effective O&M. It also involves purchasing new efficient equipment and controls, which creates jobs for the suppliers and installers. Second, companies that engage in SEM become more competitive globally because their cost structure in lower and because SEM helps management to deploy innovative methods and new technologies that increase productivity even in non-energy- related ways. A globally competitive facility is more likely to expand in the future, and much less likely to close its doors. Third, since energy efficiency is a great investment, efficient plants make more money, allowing the owners or investors to buy other things whose production creates jobs.
To reduce industrial emissions proportionally to those expected in other sectors would require a rate of improvement of almost 7% annually—a challenging goal. But when even the leading companies refuse to invest in improvements that pay back their costs in three years, there is a lot of profitable slack in the system that could be addressed by policy, including utility programs for SEM, changes in financial rating criteria to allow companies to borrow and invest in profitable efficiency upgrades, and just the process of setting goals and tracking progress. That is why the typical large company engaging in SEM finds that the improvements (that they had not undertaken before) pay back in 1 ½ years.
So far, the extent of incentivized SEM programs has been minimal: generally small-budget programs in only a few regions. Worse yet, without financial incentives, SEM participation has not been sustained. Thus incentive programs are needed for the existing efforts to be rapidly expanded and to target more ambitious goals.
A policy option to promote SEM would encourage businesses to set goals for continual improvement in energy performance, counting both efficiency and non-emitting energy supply, and to make their metrics and results publicly available. The author has developed a tax incentive proposal to encourage businesses to do this. The tax incentive pays for itself, because the energy savings that result reduce tax-deductible energy expenses— deductions the participating company would otherwise have taken. Many large companies already publish annual sustainability reports, and this dataset could be the central component of their analytics. Also, SEM is applicable not only to industry. It can be used by building operators, even single families, where it will promote not only physical retrofits but emissions-reducing behaviors.
Financing the improvements should not be a problem, since they are all very cost effective. It may be helpful to change lending or financial rating methods analogously to what is recommended for the buildings sector.
4. Saving Emissions in the Supply Chain
Most of industrial emissions are caused by a very small number of industrial categories, such as steel, chemicals, cement, etc. No systematic analysis has yet been undertaken of where all of these energy intensive products are used, and whether there are alternatives. Yet a growing number of businesses are starting to track the upstream emissions consequences of their activities, and in the process discovering savings opportunities that no one knew were there.
As more companies undertake SEM and look at the supply chain, new emissions savings opportunities will emerge in areas that no one anticipated. For example, NRDC has shown that 40% of food is wasted. Food supply and preparation account for some 25% of climate pollution. If we could cut food waste in half, we could save an additional 5% of emissions. NRDC also estimated that reduced parking needs—reducing the need to construct new parking spaces—could cut emissions by some 100 million metric tons of CO2 annually—about 10% of the residual emissions for 2050 in the 2 degree scenario. This potential is also entirely absent from any climate studies we have seen.
A policy option to promote SEM would be to encourage businesses to set goals for continual improvement in energy performance, counting both efficiency and non-emitting energy supply, and to make their metrics and their results publicly available.
Many large companies already publish annual sustainability reports, and this dataset could be the central component of their analytics. Also, SEM is not only applicable to industry. It can be used by building operators, even single families, where it will promote not only physical retrofits but emissions-reducing behaviors.
5. Forestry
Most analyses of emission reduction potential focus on opportunities to reduce emissions from combustion of fossil fuels. Expanding that focus to include forestry provides additional opportunities. The past few decades have seen a significant loss of forests, primarily in the tropics. As these forests are cleared, the stored carbon in the trees and forest soil is released into the atmosphere. The emissions from this deforestation accounts for approximately one quarter of the total climate forcing over that period.
Reducing the rate of deforestation will lower emissions and contribute to meeting a 1.5 degree target. Additionally, restoring forests, planting new forests, and increasing forest growth—or reforestation, afforestation, and improved forest management—provides one of the few opportunities to sequester carbon that has already been released and lower CO2 concentrations in the atmosphere. CO2 concentrations are also lowered by the absorption into the oceans, but this results in acidification with increasingly dangerous implications for ocean ecosystems.
Forests are cut down for a variety of reasons, including the need for forest products such as paper, wood, and fuel and in order to make land available for other purposes such as agriculture and development. Clearing of forests results in emissions from the release of the stored carbon in the trees. But more often the emissions occur rapidly through losses in conversion into wood products, direct combustion of wood for fuel, or decomposition of short-lived wood products such as paper and packaging. Forest soils often also contain significant amounts of carbon which can be lost to the atmosphere when forests are cleared. In the case of peat soils, the amount of soil carbon can exceed the amount of carbon in aboveground biomass.
Strategies to reduce forest emissions and increase sequestration need to include measures that protect forests and instead focus development on already-cleared lands as well as efforts to reduce the demand for forest products through increased efficiency and use of recycled products.
Forest protection is necessary to reduce the huge emissions that occur when existing forests are cleared. Protection of existing forests is also critical to protect the many co-benefits that these forests provide, including species habit, forest products for local communities, and soil carbon. Once an old-growth forest is cleared, it can take decades to centuries to restore the full range of benefits that the forest provides.
Improved Forestry Practices Can Reduce Emissions
Reduced demand for forest products is also essential. If demand continues to grow, then the pressure for forest clearing will overwhelm site-specific efforts to prevent clearing. (The problem of reduced emissions in one place being replaced by emissions elsewhere is known as “leakage.”) Demand for forest products can be reduced through a variety of strategies including improved efficiency and increased use of recycled products. For example, we can reduce the need for virgin paper by double-sided printing and by increasing the use of recycled paper.
Finally, planting new trees and allowing trees to grow longer before harvest offer a significant opportunity to increase the amount of carbon dioxide that is removed from the atmosphere. Over the past few decades, terrestrial ecosystems have sequestered large amounts of CO2, largely offsetting emissions from land-use change. Afforestation on degraded and/or deforested lands can supplement this important carbon sink.
It typically takes decades before newly planted forests sequester carbon at high rates, so early action to plant trees now is essential to provide benefits in the middle years of this century. Afforestation can also provide many co-benefits including water retention, flood protection, and ecosystem benefits which help to justify a significantly increased level of investment. Urban forestry offers a particularly large array of co-benefits in addition to the direct benefit of carbon sequestration, including improved air quality, reduced summer temperatures (which reduces need for air conditioning), and improved property values.
Significant progress has already been made in reducing emissions from deforestation. The FAO estimates that global emissions from deforestation have decreased by 25% from 2001-2015. But multiple analyses find that reduced deforestation, improved forest management, and afforestation offer further large cost-effective options for emissions reductions. One study estimates the potential for emission reductions from reduced deforestation of up to 2.7 GtC/year. Increased afforestation and improved forest management could add significantly to this total.
6. Reducing Methane Leaks
There are two types of policies that can reduce methane leaks, which currently account for about 15 percent of U.S. greenhouse gas emissions, on a weighted basis.
The first is to swiftly and significantly reduce methane emissions from all sectors of the natural gas and petroleum industries, from production through distribution. According to the EPA's most recent Inventory of U.S. Greenhouse Gas Emissions, the oil and gas industry emits nearly 30 percent of total U.S. methane emissions, making it the largest industrial source of methane emissions in the nation. Pound for pound, methane can cause over 80 times more warming than carbon dioxide, so reducing emissions of this short-lived but powerful greenhouse gas is crucial to fighting climate change.
Given that methane is the primary component of natural gas, controlling emissions also makes economic sense for industry because methane that is not leaked is methane that can be sold. Additionally, technologies for reducing methane emissions are readily available and low cost. Despite these facts, the oil and gas industry has made only very modest progress on reducing methane emissions voluntarily, due at least in part to the fact that projects to reduce emissions may yield a lower rate of return than, for example, drilling new wells and therefore have a hard time competing for capital. Federal and state policies to reduce emissions are therefore crucial.
Leading states such as Colorado and Wyoming have strong and sensible rules to control methane across the oil and gas supply chain. At the federal level, in 2016 EPA put in place important rules that will apply to new sources of methane emissions and has begun the process of planning to regulate existing sources. Oil and gas equipment and facilities already in operation will be responsible for the vast majority of future methane emissions—one study found that by 2018 almost 90 percent of methane emissions from the oil and gas sector will come from sources that were already in operation in 2011. In order to meet climate goals, it is therefore critical that comprehensive policies be developed and implemented to control emissions from existing sources. The U.S., Canada and Mexico recently committed to reduce methane emissions from their oil and gas sectors by 40-45 percent below 2012 levels by 2025, and explore new opportunities for additional methane reductions. These goals will only be reached if the countries move swiftly to control existing sources of methane pollution.
Mitigating methane emissions will create high-value jobs at the dozens of firms that manufacture mitigation equipment and/or provide emissions reduction services. These firms provide high-paying U.S. jobs in at least 531 locations across 46 states.
The second set of policies for reducing methane emissions is to look for places where the existing gas distribution system is aging and leaky to the extent that expensive replacement is needed, and to shut these systems down and electrify the buildings that are currently served. Electrification in many cases will be cheaper than replacing the gas pipes, and will not only eliminate the methane leaks permanently but also reduce emissions because electrification of low temperature heating is already a part of the two-degree scenarios. These opportunities can be pursued immediately. Other more expensive replacements of electricity for gas should be done later, and planned in advance to minimize economic losses.
The reason it makes sense is that while 20 years ago, the most efficient way to provide space heating and water heating was to burn gas at the building site, today electric generators and heat pumps are more efficient than they used to be, such that a unit of gas burned at a power plant produces more heat than it would have if burned at the building. Not only that, but the sources of electricity are rapidly becoming more heavily tilted to wind and solar, and accelerating this trend is part of the low-emissions scenarios. California, the nation’s most populous state, and New York, with the third largest population, have already committed to 50 percent renewables by 2030; Hawaii and Vermont have set even higher renewables goals.
Summary of New Programs for Dramatic Emissions Reductions
This essay has suggested six new programs that go beyond most of the savings in greenhouse gas emissions that have been included in studies focused on meeting the 2 degree goal. NRDC has modeled these six policies using a simplified version of the methodology we employed in the 2017 America’s Clean Energy Frontier report.
The savings from the six new policies are modeled as follows. We begin with NRDC’s detailed modeling what it takes to limit climate change to 2 degrees.
Next, we use these disaggregated model results to project the outcome of all of the policies included in the cited study plus the six new policies in the Electricity Policy paper.The results are shown in Figure 1.
Figure 1: Modeled emissions reductions in this 1.5-degree scenario
This graph shows that the cumulative emissions through 2080 in the 1.5 degree scenario are only slightly above half the emissions of the 2 degree scenario. Thus even limiting the scope of new policies to a half dozen almost meets the goal. Additional policies clearly could close the gap entirely.
End Note
My thanks to Peter Miller and Briana Mordick of NRDC for taking the lead in writing the sections on forestry and reducing methane leaks, respectively; and to Amanda Levin of NRDC for creating Figure 1, including performing the modeling underlying it. Also thanks to Robert Marritz for his editorial advice and his assistance in framing the issues for 2018.
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