The only words that accurately describe EPA’s new proposed carbon rule are “recklessly irresponsible.” EPA’s Clean Power Plan to reduce carbon emissions by 2030 to 30 percent below 2005 levels is, moreover, impractical.
Achieving EPA’s mandate would reduce US carbon emissions to levels of the late 1960s, when our population was about 203 million and our GDP was about $2.8 trillion. Today, our population is about 315 million and our GDP is about $17 trillion. In 2030, the US population will exceed 360 million and our GDP is projected to be about $21 trillion, in current dollars.
So how does our population grow 14 percent and GDP 24 percent while our carbon emissions shrink 30 percent? A growing population and growing economy require energy. While improvements in energy efficiency enable us to use less energy per dollar of GDP, there is no known mechanism for achieving sustained economic growth using less absolute energy.
Coal is the backbone of our electric power system providing about 37 percent of our electrical energy. Natural gas, a growing source for power generation, provides 30 percent, and nuclear 19 percent. Renewables, excluding hydropower, provide a paltry 5 percent, according to EIA.
Clearly, the Obama Administration is banking on renewables to fill a large portion of the energy gap caused by shuttering a large number of coal-fired units. It won’t happen.
Our abundance of natural gas provides an affordable source of lower carbon energy but that doesn’t mean that EPA’s mandate can be easily achieved. Earlier this decade, DOE calculated what would be required to achieve about two-thirds of the EPA mandate: build 273 zero-emission 500-megawatt coal-fired plants, or 270,000 one-megawatt wind turbines. Those numbers are staggering, and pursuing the mandate will do serious damage to our economy. Some estimates run as high as $50 billion annually with the hit to employment being on the order of 200,000 jobs annually.
The magnitude of the economic impacts can be debated, and undoubtedly will, but there can’t be a debate about the impact being negative. Just look at the empirical evidence from across the Atlantic. The economic impacts of similar policies by EU nations, in every case, have been to lower economic growth, increase unemployment, and drive up electricity prices. Germany, with the strongest of the EU economies, has seen its electricity prices skyrocket to the highest on the continent, private investment go elsewhere, and energy intensive industries close or move to other countries.
In addition, there will be no environmental gain. Dr. Benjamin Zycher of the American Enterprise Institute, using a government climate model, concluded that even deeper reductions would have no perceptible effect on global temperatures.
The reason is simple. China, India, and other emerging economies are not going to forego economic growth when there is growing evidence that the climate risk has been continuously overstated. Indeed, there must be joy in Tiananmen Square that the President is proposing actions that could help China become the world’s largest economy.
With all cost and no benefit, why is the President doing this? Some say to secure his legacy. A more pragmatic explanation is to rally his base in November to help Democrats retain the Senate. Recklessly irresponsible!