Population Projection Revised Upwards...Again

by Duncan Gromko

The following was cross-posted with the Public Education Center's DC Bureau, which you can find by clicking here.

The UN now estimates that there will be 9.6 billion people by 2050, which is a revision upwards from their 2010 estimate of 9.3 billion. For some environmentalists, this is a scary thought. A simplistic take on natural resource use suggests that more people mean more consumption and more pollution.

Estimating global population, let alone projecting population two generations from now, is a tricky business. While some groups estimated that the world passed seven billion people on October 31, 2011, others thought that the milestone was passed in March of 2012. Even the world’s best censuses have a 1-2 percent margin of error.

Source: DSS Research

The 2050 projections have been revised upwards because of changing demographic trends in the developing world. Projections assume that global fertility rates will converge to 2.1 children per woman and a stable population. However, fertility rates have remained higher than projected in many countries, particularly in sub-Saharan Africa. Below is a chart showing the countries with the largest upward projections (as a percentage of their population).

Source: New Security Beat

Accurately predicting population decades from now is difficult, but the multiple upward revisions in recent years make for a worrying trend. While growth in some countries is more or less reflecting demographers’ predictions, population growth in other countries continues to spiral upwards. Nigeria, which doesn’t even make the above chart, has had its 2050 projections revised from 289 million in 2008 to 390 million in 2010 to 440 million this year. What will the next projection be?

Most of this growth is happening in developing countries, as fertility rates have mostly stabilized in the developed world.

Source: Learner

As a Peace Corps volunteer in Morocco, I worked on family planning projects. Many of the women with whom I spoke struggled to access birth control on a consistent basis. What’s more, doctors often did not take the time to explain how to use birth control. One woman with whom my colleague spoke asked why the birth control pill her husband was taking wasn’t keeping her from getting pregnant.

While use of contraceptives has increased, access to birth control remains a huge barrier in many parts of the world. The United Nations Population Fund estimates that 215 million women want to delay or cease childbearing – about one in six women of reproductive age – but do not have the means to use birth control. Helping these women would be a huge win not only for them, but also for the environment.

Slowing population growth could reduce greenhouse gas emissions by as much as 1.1 billion tons per year by 2050. Family planning is an inexpensive way to reduce greenhouse gas emissions. Climate scientists normally talk about the “abatement cost” of a particular technology or behavior change, i.e. how much each ton of greenhouse gas reduced will cost. For instance, the abatement cost of solar PV was estimated at around $15-20 per ton of CO2 by McKinsey in 2009. Tom Lovejoy estimates that the abatement cost of reducing carbon emissions through family planning is $4.50 per ton. If carbon pollution is all you care about, reducing population growth through family planning is cheaper than reducing per capita greenhouse gas emissions (although both are needed).

It’s important to note, however, that despite increasing populations in developing countries, these countries are largely not responsible for historical or future greenhouse gas emissions. The United States, China, and the European Union all have relatively stable populations, but are responsible for most of global emissions. The USA’s per capita emissions was around 17.2 tons per year in 2009, while Nigeria’s was 0.6 tons per year.

Of course, impact on climate isn’t the only environmental consequence of a growing world population. The areas with the highest rates of population growth also tend to have the greatest pressures on local natural resources. Sub-Saharan Africa and South Asia are already facing challenges from water scarcity and deforestation with their existing populations. What’s more, much of this growth is happening in urban areas where infrastructure is overwhelmed by the growth explosion. Slums and urban poverty are the result.

Support for family planning and educating women – which is associated with lower fertility rates – has benefits for local populations and the earth. Giving women the tools and knowledge they need is an important goal that I think is often overlooked by many environmentalists.

Indiana Regulators Let BP Pollute Lake Michigan

By Nick Cunningham
The following was cross-posted with the Public Education Center's DC Bureau, which you can find by clicking here. 

The Indiana state government recently extended a deal with BP that allows it to continue to dump toxic waste into Lake Michigan. Back in 2007, it gave BP permission to increase discharges of toxic pollution into Lake Michigan as part of a $3.8 billion expansion of its Whiting, IN refinery. BP wanted to upgrade the facility to be able to process heavier crude oil, as Canadian tar sands began to flow southward in significantly larger volumes. Originally constructed in 1889 under John D. Rockefeller’s Standard Oil Company, BP’s Whiting facility is one of the nation’s largest oil refineries, a massive complex located in Indiana near Chicago.

Indiana’s Department of Environmental Management granted an exemption from federal water protections to BP as part of its permit, which allowed to company to dump 54 percent more ammonia and 35 percent more toxic sludge into Lake Michigan. The permit also allowed BP to discharge 23.1 parts per trillion of mercury – 20 times the amount of mercury allowed under federal law. BP also consistently dumped other toxic chemicals such as benzene, lead, nickel and vanadium.

Mercury is known to cause brain damage, especially in children. However, Indiana regulators justified the exemption because the refinery expansion would provide “important social or economic benefits” – in this case, the project would create a few thousand temporary construction jobs and 80 permanent jobs.

Then Indiana Governor Mitch Daniels defended the decision. When asked if the giveaway would move forward, Daniels replied, “Yes. We’ve checked it and rechecked it. They’re in complete compliance with Indiana law, which is tougher than the federal law. The EPA has checked and rechecked it, and they have approved that permit more than once. To me, the public interest says it should go forward.

Former IN Gov. Mitch Daniels

“We’ve got thousands of jobs that will be at risk if it doesn’t go forward. And I would only point out that people who are upset about $3 gas now know why it’s that high. Reported as recently as last weekend, the No. 1 reason for $3 gasoline is the lack of refinery capacity in this country, and here’s one of the biggest steps forward for the Midwest and really the whole nation. And I don’t think it should be held up without a good scientific reason, and none has been provided.”

The 2007 deal exempted BP from federal water pollution limits for 5 years. Under the agreement, BP was required to conduct research into technology that would reduce mercury pollution it discharged into Lake Michigan. It worked with the Argonne National Lab to explore new technologies.

However, in 2011, as the original five year exemption neared expiration, Indiana regulators extended it because BP argued it would not be able to implement pollution control technology in time. Despite these assurances, pilot tests of new technologies found that mercury could be reduced to below federal limits. Yet BP asserts that the $21-$147 million price tag was too high – even though it expects to haul in an additional $1 billion in annual cash flow from the facility.

To make matters worse, a recent draft permit would once again extend the allowance – this time indefinitely. The permit would not require BP to actually implement mercury-reducing technology. Instead, BP said it would continue to do research and would merely report back in 2015 on its findings.

Meanwhile, BP finished its upgrade, allowing it to process an additional 250,000 barrels of crude per day. And it continues to pollute.

Obama's Big Climate Plan and Speech

by Duncan Gromko

President Obama gave a major climate change speech (full video and transcript here) and released a Climate Action Plan on Tuesday. It’s just one speech and there is a lot to work to implement the plan that he has laid out, but the plan and the speech far surpassed my expectations. There isn’t much more that the Executive Branch can do on climate change without help from Congress.


Here’s the biggest climate news from the plan and the speech: “I'm directing the Environmental Protection Agency to put an end to the limitless dumping of carbon pollution from our power plants, and complete new pollution standards for both new and existing power plants.” The rhetoric here – “dumping of carbon pollution” – is amazing because he’s talking about carbon in the same way that we normally talk about local pollutants. This is the single biggest step the administration can take without Congress; WRI estimates that such regulation can make up 48% of the emissions gap between business as usual and the administration goal of reducing emissions by 17% by 2020. So it’s a big deal. However, neither Obama’s speech nor his plan specifies how strict these new standards will be or how they will be implemented and there is sure to be legal and political challenges to the new standards. The specifics of the plan will end up determining the final climate impact, and Obama has not yet made this clear; all the plan says is: “The President has asked the Environmental Protection Agency to build on state leadership, provide flexibility, and take advantage of a wide range of energy sources and technologies including many actions in this plan.” If you’re curious on more details of how power plant regulation could work, here is an NRDC report on how this could work.

Source: change.gov

Regulating carbon pollution from power plants is just the start. For a full list of initiatives contained in the plan, see Wonkblog, Grist, or Climate Progress; I’m just going to list a few of the most important.

Supporting existing efforts, the plan promises to better measure methane emissions from natural gas extraction via the EPA. However you feel about how fracking could destroy local water sources, any climate benefits from switching from coal to natural gas (coal is much more carbon intensive than natural gas) could be lost if methane leakage is not controlled.

Obama declared a goal of doubling electricity fueled by renewable energy by 2020. This is tough for the President to affect with Congressional support, but Obama promised to approve permits for renewable energy on public lands that would supply 20 gigawatts of additional energy. He also said the federal government would set a new target of sourcing 20% of its energy from renewable sources (up from 7%).

Adaptation to climate change is another large component of the plan. Most of the concrete steps relate to planning continued research for specific vulnerabilities to climate change: learning from Hurricane Sandy and other tropical storms, resilience in the health sector, assessing agricultural vulnerability, managing drought, reducing wildfire risks, and preparing for future floods. Climate change is happening and the plan recognizes this reality.

Last (of the points that I’ll discuss) is a renewed effort to promote international action on climate change. One proposed way to do this is to combat short-lived climate pollutants such as methane and hydrofluorocarbons (HFCs), which have sever climate impact and are much more prevalent in developing countries. Another focus point is reducing emissions from deforestation, which amount to as much as 17% of global greenhouse gas emissions. Last, Obama also said that the USA will not support coal fired power plants in developing countries (which would appear to be at odds with current World Bank policy).

The Really Surprising Stuff

In addition to these more mainstream actions, Obama discussed a few issues that are near and dear to the hearts of climate advocates. First, regarding the Keystone XL pipeline, Obama said: “Our national interest will be served only if this project does not significantly exacerbate the problem of carbon pollution.” I never expected him to mention Keystone and his statement Tuesday will make it difficult (but not impossible) for him to ultimately approve the Pipeline. Second, he spoke directly to climate advocates in the following sentences: “Convince those in power to reduce our carbon pollution. Push your own communities to adopt smarter practices. Invest. Divest. Remind folks there’s no contradiction between a sound environment and strong economic growth…Make yourself heard on this issue.” Divestment from fossil fuels and the Keystone XL Pipeline have been two of the major issues adopted by 350.org and other climate advocates. With these remarks, Obama is speaking directly to those involved in advocacy and encouraging their actions. I think the subtext here is that he needs support to continue his climate initiatives. I was surprised.

A Couple Caveats

The big caveat is the lack of specificity as to how the plan will be implemented, particularly with EPA regulation of power plants. There are no specific standards mentioned and, although this aspect of the plan could have enormous impact, it could also have little impact if standards aren’t strict enough.

The other issue in the speech that makes me uneasy is the President’s full embrace of natural gas: “And, again, sometimes there are disputes about natural gas, but let me say this: We should strengthen our position as the top natural gas producer because, in the medium term at least, it not only can provide safe, cheap power, but it can also help reduce our carbon emissions.” I think the climate benefits of natural gas (and fracking) are debatable. And I think that there isn’t enough information about the impact of fracking on local water sources. Increased fracking will likely hurt some people. Nick and I are planning a big story on fracking and all its ambiguities, so I won’t get into them just yet.

All in All…

I was amazed by the ambition of the plan and the speech. It comes about five years later than I wanted and still isn’t going to be enough to allow the USA to meet emissions guidelines from the Kyoto Protocol (20% reduction of emissions from 1990 levels by 2020), but in the current political climate, I couldn’t have hoped for any more. I guess that’s a sign of how far expectations have fallen that I see doing less than the minimum as exceeding expectations.

I’m torn. On the one hand, this is a big step and Obama (as well as all the advocacy groups that have been pushing him for years now) deserves credit for making decisions that another president (e.g. Romney) wouldn’t have. I hope that he feels support from environmental groups to counterbalance all the negative things that will be said in the coming weeks by fossil fuel advocates. This speech and this plan should be celebrated. On the other hand, the devil is in the details with this plan and implementation will determine just how much it ends up cutting emissions. Obama needs to hear from green groups that climate can’t be something that he simply makes a big speech about every several months and then ignores. It’s also hard not to be disappointed that it’s come to this; that Obama had to work around Congress because Congress refused to address the issue. I can’t imagine a more ambitious plan, but it still isn’t ambitious enough.

World Bank Climate Predictions

by Duncan Gromko

With President Obama’s announcement of new climate change action on Tuesday, the World Bank has just released a report (written by the Potsdam Institute for Climate Impact Research and Climate Analytics) that projects how the climate will change over the coming century and how people will be affected. Spoiler alert: the news is pretty bad. How bad will depend on whether or not we get serious about limiting greenhouse gas emissions.

One big uncertainty is how much greenhouse gases humans will emit over the next century. The World Bank is basing its projections on “Representative Concentration Pathways” (RCPs), which are different scenarios for global greenhouse gas emissions levels and predicted impact on global temperature rise, shown below. RCP8.5 is the worst-case scenario, where there is no effort to decrease emissions. The other scenarios show moderate efforts to reduce emissions (RCP6 and RCP4.5) and successful effort to reduce emissions (RCP3).

If the world meets all the climate pledges it has currently made, there is a 20 percent chance of exceeding a four degree (centigrade) global temperature rise by 2100. If emissions continue as they are today, then the chances of exceeding four degrees by 2100 increases to 40%. Unless there is drastic and immediate reductions in emissions, it looks certain that we will top a two degree rise, with a reasonable chance of going over four degrees.

Compared to temperature rise, ocean acidification is something that gets much less attention. Considering the importance of coral reefs as nurseries for global fisheries, I think this is a huge oversight. As carbon is emitted into the atmosphere, the ocean also absorbs it, increasing ocean acidity. Under RCP8.5 and RCP6, there will be nearly complete die-off of coral reefs and a devastating impact on fisheries.

How will this affect us?

Temperature increase and ocean acidification will have many consequences for human well-being, including: rising sea levels, increased intensity of tropical storms, increased precipitation extremes (more droughts and floods), decreased agricultural productivity, and increase in vector-borne diseases (e.g. malaria and dengue fever).

One big takeaway from the report is how different parts of the world will be affected in very different ways. For instance, while drier conditions are projected for most regions close to the equator, including southern Europe, Africa, and much of North and South America, wetter conditions are projected for places at northern high latitudes: northern North America and northern Europe. Monsoon rains are expected to be more intense. Amazingly, even sea level rise is not uniform; in general, equatorial regions are likely to have higher sea level rise.

Close to the equator, crop productivity is expected to decrease, but at most northern latitudes, productivity will increase. Given that tropical countries tend to have the most food insecurity, this is just about backwards from the way you’d like the changes to happen. Globally, food production will increase as long as temperatures stay below a three degree increase, but at that point productivity will decrease.

But it’s not just the physical change that will be different across different world regions. Current and future wealth and investments will play an enormous role in who is most impacted by climate change. Wealthier nations will have a much easier time adapting to climate change. Wealthy cities like New York City can build sea walls to delay the negative impacts of sea level rise and increased storm intensity, but Dhaka Bangladesh will have a much harder time adapting, likely leading to millions of climate refugees.

Uncertainty

Even beyond all the uncertainty about emissions and how they will impact the climate, the models used in this report cannot capture “non-linear” events. There are feedback cycles, tipping points, and interactions between different variables that are just about impossible to model precisely. The problem is that non-linear events are exactly the kind you’d want to be able to predict. In the financial world, it was a similar kind of tipping point that ended up throwing the world into a financial crisis in 2007 and 2008.

The non-linear effect that is nearest and dearest to my heart is Amazon rainforest die-back The rainforest is so enormous that it generates and recycles much of the rain that falls in the Amazon basin. As deforestation continues, decreased tree cover may lead to less rainfall. A 2010 drought, which led to the death of billions of trees and an estimated release of 2.2 billion tons of greenhouse gases, may have been caused by decreased tree cover in the rainforest. Deforestation leads to drought, which leads to more deforestation. On top of this feedback loop, increased temperature in the Amazon due to climate change will exacerbate this effect: “there is a significant risk that the rain forest covering large areas of the Amazon basin will be lost” due to climate change. The Amazon is currently a global carbon sink, absorbing more carbon than it emits. If this die off occurred, it would very quickly become an enormous source of greenhouse gas emissions and completely outside of our control to stop.

This is just one example of a very harmful “non-linear” system and there are many others. The challenge for the World Bank and other policy and investment planners is that they would like to take steps now to adapt to climate change. While the projections in this report and other modeling can guide adaptation, the uncertainty makes it hard to plan. We know, for instance, that coastal cities will need protection when sea-levels rise. But should we plan for 1 meter of sea-level rise (the median estimate for 2100 under four degree warming) or more?

Trapped Tar Sands or Coal: Obama to Decide

By Nick Cunningham

The following was cross-posted with the Public Education Center's D.C. Bureau, which you can find by clicking here.

On June 14, Bloomberg Businessweek reported that the Obama administration is planning on rolling out a climate package in July, which may or may not be coupled with his answer on the Keystone XL pipeline. President Obama reportedly told a group of donors at a closed-door fundraiser that he will unveil a series of climate proposals in the coming weeks.

In his State of the Union address earlier this year, the president vowed to take executive action to reduce greenhouse gases if Congress failed to act. Congress has predictably done nothing, and so environmental groups have been urging President Obama to live up to his commitment.

Executive action would likely come through the Environmental Protection Agency (EPA). However, earlier this year, the EPA missed a deadline to finalize greenhouse gas limits for new power plants, which would have effectively banned new plants using coal. The EPA argued that it needed time to revise the rule in order to withstand legal challenges.

Businessweek reports that the upcoming climate proposals may include not only the previously proposed limits on new power plants, but also greenhouse gas limits for existing power plants – a much bolder course of action. After all, the EPA limits for new power plants would essentially confirm a fait accompi: it is increasingly difficult for utilities to build new coal-fired power plants anyway – even without EPA greenhouse gas limits – due to their cost.

Although new coal plants are expensive, the same is not true for existing power plants. Nearly three-quarters of all coal plants in the United States are at least 30 years old. Many of these plants are paid off, and so operating them is cheap. This creates the incentive for the utilities to run the plants as long as possible. Left to their own devices, the utilities would retire these plants gradually over time. EPA limits on existing plants could quickly and dramatically alter this equation by forcing many coal plants to shut down earlier than scheduled.

Huntington Power Plant, Utah (Photo: Utah Gov.)

The other sticky issue is the Keystone XL pipeline. Environmental groups have ratcheted up the pressure on the president to reject the pipeline. A recent report from Goldman Sachs concluded that the pipeline was key to the Canadian tar sands being economically viable. Without the pipeline, the tar sands could be “trapped in the province of Alberta.” In this scenario, RBC Capital Markets predicts that $9 billion in future investment over the coming decade would be deferred.

It is a no-win situation for the White House. Should the president approve the project, he will do irreparable harm to his support from environmentalists, but blocking it will raise the ire of the energy and gas lobby and its allies in Congress.

Based on the President’s comments to private donors, it seems his administration is leaning towards approving the pipeline but coupling it with the EPA limits on greenhouse gases. He may somehow seek to make one conditional on the other. However, this will likely spark a firestorm in Congress, as a group of 24 Republican senators sent a letter to the president in May warning against such a move. “We are concerned by recent proposals that you pair approval of the Keystone XL pipeline with enactment of new environmental regulations and energy taxes,” they wrote.

On balance, if the EPA can actually implement limits on carbon dioxide, the benefit to the climate may considerably outweigh the downsides of approving the pipeline.

Still, after years of putting climate change on the backburner, the president may be ready to make these issue a priority, or at least take some action to address them.

Ecosystem Services and the Panama Canal

by Duncan Gromko

The following was cross-posted with the Public Education Center's D.C. Bureau, which you can find by clicking here.

Lake Gatun, Panama

When ships cross the Panama Canal, a series of locks raise them a full 26 meters. Letting water in and out of the locks uses a lot of water from Gatun Lake – more than 55 million gallons for each ship. As cargo ships become larger, the Canal is being expanded, which would create even more demand for water. Rainfall in Panama varies significantly depending on the season – during the dry season, water withdrawals from the Canal make a significant impact on water levels. Each year, there is a one in fifteen chance that water levels will drop so low that Canal operations are restricted.

Since the Canal generates an annual $1.8 billion in fees for the government of Panama, there is a very real economic reason to ensure continued water flow for the Canal and the expansion of the Canal makes that need even more pressing. As I’ve written about before, forests and other ecosystems play an important role in providing a dependable water supply.

The Canal watershed is 55 percent forested, a 40 percent decline since 1974. In order to maintain water supply to the Canal, Panamanian policymakers have created protected areas for two-thirds of the forested Canal watershed. A 1997 land-use plan aims to increase forest cover in the watershed through reforestation in order to increase water flows to the Canal, particularly during the dry season.

However, a recent study by Silvio Simonit and Charles Perrings (sorry, the full article is behind a pay wall) says this reforestation initiative may be slightly misguided. The relationship between ecosystems and local hydrology is much more complicated than it may seem at first glance. “The net impact of vegetation change on water flows depends on its effects on surface runoff, infiltration, and evapotranspiration. Transitions between vegetation types alter all three.” Forests increase the infiltration of water into the soil, allowing for groundwater recharge. They also increase an ecosystem’s leaf index (the surface area of all green surfaces for a region), which increases evaporation. These two forces counteract each other and local circumstances determine which one dominates.

Canal expansion

The specific results of the study are too complicated for a blog post, but the important takeaway is that reforestation in some places will increase water flow, but in other places will decrease flow. “…Only where there are high precipitation rates, flat terrain, and soil types with high potential infiltration is reforestation likely to enhance dry-season flows.” Only 37 percent of currently forested area increases dry-season water flows; reforestation of the entire area would reduce dry-season flows by 8.4 percent.

In addition to specific recommendations for the Canal watershed, this study has broader implications for policymakers. As the term “ecosystem services” becomes a part of people’s vocabulary, it’s important to understand that the relationship between an ecosystem and the benefits it provides to people is not a simple one. Not all forests directly increase water supply. Some coastal reefs will provide greater storm protection than others. Some biological diversity is more valuable to people than other.

Allow me to indulge in a slight tangent: this brings up two important issues with the push to include ecosystem services into decision-making. First, it means that careful study is needed to be sure that investments in ecosystems lead to the desired benefits. Panama can increase dry-season water flow to the Canal through reforestation, but only if it targets the right areas. It’s even more complicated than the article describes; ecosystems are complex systems that are probably impossible to fully model. For instance, although evaporation from increased tree cover decreases water recharge, it also contributes to cloud formation, likely increasing precipitation elsewhere. Second, reducing the value of nature to the benefits it provides people is, well, very anthropocentric. Is improving human welfare the only reason to protect the environment?

Panama Canal shipping routes

Coming back to Panama, the article points out that there are many other benefits to forest restoration. Although the impact on water supply is ambiguous, reforestation will unequivocally increase carbon sequestration and timber supply. This is where the decision gets really complicated. Does Panama prioritize: a) timber production, which would have a local economic impact, b) water supply, which would also have an economic impact, but on a different population, or c) carbon sequestration which provides global benefits (since it reduces the impact of climate change). And there are other tradeoffs as well: reforestation might increase ecotourism, but will likely require the displacement of agriculture.

All in all, planning based on ecosystem services is complicated. Simonit and Perrings’ study improves our understanding of how the environment impacts people. However, we still have a lot to learn. And the expansion of the Panama Canal is setting off a series of environmental challenges at ports throughout Latin America that need to be addressed.

Renewable Portfolio Standards provide economic benefits at ‘little or no’ cost

By John Hensley

Trailblazing the renewable energy frontier, in 1983 Iowa became the first state to implement a renewable portfolio standard (RPS).  Though modest – the RPS only required the state’s two biggest utilities to procure 105 megawatts (equivalent to about 50 modern-day wind

turbines) of renewable generation capacity – the policy positioned Iowa to become a renewable energy leader.  Fast forward to today and you will find that 29 states and the District of Columbia have RPS policies in place.

In concept, an RPS is a simple policy designed to provide renewables, which have historically been more expensive than fossil fuels and thus unable to be competitive, with a guaranteed market.  Renewable energy is an infant industry facing an uphill battle against well-established conventional fuels that have enjoyed decades of government support.  As such conventional fuels are relatively cheap, especially since they do not have to account for external costs such as pollution.  In this setting, RPS programs provide renewables an opportunity to establish themselves and quantify the environmental benefits they offer including reducing greenhouse gas emissions. 

Basically, an RPS requires electric utilities to gradually increase the amount of renewable energy that they deliver to customers.  By design, an RPS does not hand-pick a technology; rather all renewables are forced to compete, incentivizing cost reductions and efficiency gains.  Over time, the more efficient renewables close the gap with conventional fuels and are capable of competing directly in the open-market.

And guess what? It’s working.  Since Iowa began requiring renewables, RPS policies have successfully driven renewable energy demand, bringing down costs and providing economic benefits to rural communities across America. A new report from the Union of Concerned Scientists, How Renewable Electricity Standards Deliver Economic Benefits, captures these cost savings and economic benefits, concluding that “utilities are successfully meeting their renewable energy requirements with little or no additional costs to consumers, while supporting rapidly growing renewable energy industries that provide substantial economic benefits.”

According to UCS, RPS policies apply to approximately 50% of the total U.S. electricity demand and will drive the development of more than 87,000 MW of new electricity generating capacity from renewable energy sources through 2025 – enough electricity to meet the annual needs of more than 24 million American homes.  To date, compliance with the renewable requirements has been high – over 96 percent of RPS requirements were met through 2010 – with many states, including Colorado, Kansas, and Minnesota, “several years ahead of schedule.”  High levels of compliance in future years are also expected, with many utilities continuing to bring substantial renewable energy capacity online.

Not only are utilities successfully complying with the renewable energy laws, they are doing so with “little or no additional costs to consumers.” Examining 2009 and 2010 RPS cost data, Lawrence Berkeley National Laboratory researchers found that out of 14 states only one experienced cost increases of more than 1.6 percent.  UCS points to eight states – Michigan, Minnesota, Oregon, Illinois, North Carolina, Kansas, Wisconsin, and Rhode Island – where consumers’ electricity rates have been minimally impacted, exemplifying the cost-effectiveness of RPS programs.

In fact, in some states, building renewable electricity generation is saving customers millions of dollars.  Just yesterday, Xcel Energy, the major utility in Colorado, announced that the company’s plan to add 550 MW of new wind capacity will save customers $300 million over the life of the projects.  As renewables continue to become cheaper – wind costs have fallen 20 percent since 2010 and solar PV costs dropped 33 percent from 2011 to 2012 alone – consumers will enjoy further reductions in their electric bills.

Moreover, because renewable electricity sources have zero “fuel costs” – the wind and the sun are free – they serve as a hedge against future fossil fuel price volatility.  As UCS concludes, “increasing renewable energy also helps stabilize electricity rates and provide long-term savings. Once a wind or solar facility is installed, the ‘fuel’ is free. Fossil fuels, on the other hand, are subject to potentially volatile prices that can lead to significant fluctuations in electricity rates.”

In addition to minimally impacting consumer’s electricity rates, RPS policies create a range of economic benefits, summarized by UCS:

• The renewable energy industry supports American jobs. More than 119,000 people worked in solar-related industries in 2012, while wind energy development employed 75,000 full-time workers across the U.S., including 30,000 jobs at manufacturing facilities throughout the country.
• Renewable energy development promotes investments in the U.S. economy. In 2012, wind power made up 42 percent of all new U.S. electric capacity additions, representing a $25 billion investment in the U.S. economy.
• Renewable energy development outperforms fossil fuels in two important ways when it comes to driving job growth: 1)  Renewable energy development is relatively labor intensive, so it creates more jobs per dollar invested than fossil fuel resources and 2) Installing renewable energy facilities uses primarily local workers, so investment dollars are kept in local communities.
• Local landowners benefit from renewable energy development. When wind turbines are installed on privately owned land, the land owners typically receive payments in the form of lease, royalty, or right-of-way payments. These payments can be an important source of income for rural families.
• Renewable energy projects pay property and income taxes that help support states and local communities. For example, wind projects in Iowa, which now generates more than 20 percent of its electricity with wind, provided more than $19.5 million in annual property tax payments to state and local governments in 2011.

Unfortunately, despite the success of RPS policies there has been an onslaught of legislative bills attempting to diminish or repeal renewable requirements in more than two dozen states.  Support for these attacks come from conservative organizations like the American Legislative Exchange Council (ALEC), Beacon Hill Institute, and the Heritage Foundation, which all support a fossil fuel dominated status-quo.  To their dismay, the dominance of fossil fuels is increasingly undermined by cheap renewable energy, so they are desperate to eliminate key drivers such as RPSs. 

Luckily, bipartisan support for RPS policies remains strong and most of the attacks have been successfully defended.  Even North Carolina’s legislature where Republicans enjoy a super-majority refused to retract its RPS – and not once, but twice. 

RPS policies have proven their effectiveness, and lawmakers have shown they are aware of the positive economic benefits accompanying renewables.  But it’s important not to stop here; we need to continue to educate lawmakers to prevent future attacks from happening.  The UCS report is a great addition to the growing mountain of evidence in favor of renewables.  

John Hensley is a policy analyst at the American Wind Energy Association where he provides market analytics, focusing on wind energy’s economic impact at the state-level. A native of Wyoming, he is passionate about renewable energy as a mechanism to promote rural electrification and mitigate climate change impacts. Opinions in this article are his alone. You can follow him on twitter @WYOhensley.