February 26, 2015 Categories: Clean Energy Climate Change Low-Carbon Fuel

Visions of a Low-Carbon Future Come Into Focus

Climate change research has just entered an exciting new phase. In addition to the core work of improving models and exploring new technology, there are more and more papers coming out which describe what a low-carbon future might look like. We are seeing an ever-greater focus on charting a realistic course toward a sustainable future. The recent ICCT report on Low Carbon Fuels in the Pacific Region has already been discussed in depth, in this space and others. Recently, another important research study was released which further describes what a low carbon future might look like.

Achieving California’s 80% Greenhouse Gas Reduction Target in 2050

Authored by scientists at UC Davis and the Institute for Applied Systems Analysis, the new report was published in the journal Energy Policy (available here, subscription required). It describes how California might achieve its ambitious goal of reducing its greenhouse gas emissions to 80% below 1990 levels by 2050. They evaluated several scenarios which represent different combinations of technology and policy, using a complex computer model of energy systems. The model picks the lowest cost options that meet California’s energy needs. By comparing how the model behaved when required to reduce greenhouse gas (GHG) emissions against how it behaved without such a constraint, you can see whether aggressive GHG reduction targets are possible and what they might cost. The team ran a variety of scenarios, some assume rapid deployment of sustainable energy systems, others are more pessimistic. There was a common result however, the state achieved its targets under most of these scenarios and while not all of them hit the 80% reduction goal by 2050, all managed to achieve at least 74% reductions in GHG emissions. Hitting the 80% target by 2050 is not fait accompli, but as long as the state follows through on its promises, the goal is well within reach.

Investments Now Pay Big Dividends in the Future

Renewable energy is getting cheaper all the time while fossil fuels are likely to get more expensive as production of fossil fuels shifts to “unconventional” resources like shale and tar sands. Oil may be at historical low prices today, but with geopolitical tension in oil producing regions and billions of people in emerging economies seeking motorized mobility, this is likely a short term deviation from a long term trend. If you think today’s low oil prices are going to last, think again.

When you compare the cost of building renewable energy infrastructure now against the cost of 35 more years of oil consumption, the renewable option starts to look pretty attractive. The state can meet its aggressive GHG reduction goals with a total investment of $10-80 billion between now and 2050, or 0.01-0.11 % of state GDP[1]. If you assume that renewable technology, like carbon capture and sequestration develops quickly, or oil prices climb substantially above historical trends, the program could ultimately return more in oil savings than it would require in investment. Even the most pessimistic assumptions don’t require more than one percent state GDP be invested in sustainable energy. It’s important to note that the model doesn’t include any of the benefits from renewable energy, such as improved air quality or reducing the intensity of climate change. The benefits from this investment clearly outweigh the costs, even under the most grim assumptions (our own Dan Lashof recently explored this subject in more detail).

The Future is Bright

California is currently considering its next steps on climate change and this has given us a time for self-reflection. The evidence we have shows that the system has been working effectively so far, but it’s clear that the state’s current policies will not achieve the 80% goal in 2050. As the state considers next steps, it is important to make sure that we are moving towards a goal that is both achievable and desirable. This study answers yes to both questions; the state can meet its most aggressive targets and it will provide substantial benefits for us to do so. Luckily, progress is being made. California is seeking to extend its landmark Global Warming Solutions Act past 2020 and Oregon and Washington are taking their first steps toward sustainable climate policy. It’s time for all of us to make our voices heard: The experts have spoken, the evidence from California is quite clear. Strong climate policies are a win for the environment and for the states that embrace them.


[1] This assumes that the amount of vehicle travel continues to grow along historical trends and a 4% discount rate. Discount rates, or the amount which by which you value near term costs more than future ones, can make a substantial impact on the valuation of large-scale policies and problems, like climate change. For an excellent discussion on the subject see: http://bit.ly/1vv8l1N. 4% is considered a fairly reasonable discount rate for problems like this.

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