|Climate Protection and the National Interest (WRI, 1997, 56 pages)|
The United States today faces challenging threats related to climate change, air pollution, and energy security. These threats have their roots in our consumption of energy and are linked through the gases, pollutants, and technologies associated with the burning of fossil fuels. If tackled together, these linked problems can be solved far more efficiently and economically than if addressed separately. Yet, the nation continues to treat them separately, sometimes alleviating one only to exacerbate the others. Major decisions that address each problem in isolation are being made every day, and we are missing the opportunities and benefits that could be gained from solving them as a package. It is time to re-think our approach.
Policy approaches that grasp win-win opportunities can expect broad public support. People seem more willing to pay the price for actions that simultaneously protect Earth's climate, safeguard the health of today's citizens, and enhance national security by minimizing military conflict, than they would be to support actions to achieve each goal separately. Across the board, it is time to look for systemic solutions to vexing policy problems rather than continuing the inefficient and often ineffective approach of treating only the symptoms of those problems.
In order to reduce greenhouse gases and grow the economy, we must invest more in the technologies of the future.. .With the best ideas and strategies, and new technologies and increased productivity and energy efficiency, we can turn the challenge to our advantage.
Pres. Bill Clinton
This report provides the foundation for designing common solutions by explaining how the problems are linked and what technological paths can most readily surmount them. In capsule, the set of linked problems follows:
Climate Change, which could affect virtually every aspect of national life, stems from the build-up in the atmosphere of certain "greenhouse" gases, in particular, carbon dioxide - largely the result of burning fossil fuels. At the 1992 Earth Summit in Rio, 166 countries endorsed the United Nations Framework Convention on Climate Change (UNFCC). International negotiations are now underway among the UNFCC signatories to define a protocol that will limit emissions of greenhouse gases after the year 2000. These negotiations, set to conclude in December 1997, have become politically charged as individual countries weigh the perceived risks to their economies against the future risks of climate change and seek to allocate responsibility in a manner most favorable to their own interests.
Local and Regional Air Pollution threatens human health and the environment. Though alleviated by federal and state programs, air pollution - largely from fuel burning - still poses health risks to one in three Americans. Air pollution directly affects human health and, when transported over long distances, acidifies streams, lakes, and soils and in so doing, harms aquatic life, reduces crop yields, and injures and kills trees. Pollution also impairs visibility and damages buildings and monuments; some air pollutants contribute to climate change. Air quality standards have been the focus of heated debate over the past year, as the U.S. Environmental Protection Agency considered and ultimately adopted strengthened standards to reduce exposures to ozone and small airborne particles. Controversy will no doubt continue for years as cities grapple with the challenge of complying with the new standards.
Growing Dependence on Imported Oil threatens long-term U.S. security. National security is increasingly jeopardized by our growing dependence on imported oil, especially from the unstable Middle East. In 1996, the United States imported (net) more than 46 percent of its oil supply - and twice as much oil from the Persian Gulf as it did in 1973 before the Arab oil embargo. Middle East nations accounted for fully 30 percent of global oil production in 1995, contrasted with only 18 percent in 1985. Dependence on imported oil profoundly influences U.S. foreign policy: The risks to Middle Eastern oil supplies factored heavily in U.S. involvement in the 1991 Persian Gulf War. Additionally, increased dependence on imports adds pressure to produce oil from environmentally sensitive areas at home. Debates frequently rage over the economic and environmental tradeoffs associated with further exploration for oil in Alaska, or with the development of other energy sources in areas of high value for biological diversity and wilderness protection.
For many energy-related issues, the synergies and trade-offs among these three problems are very much apparent. Consider the restructuring of the electric power industry that is occurring. To increase competition and provide cheaper power to consumers, the United States is deregulating its electric utilities. With this restructuring, consumers will be able to purchase electric power from the supplier of their choice, just as deregulation of the telephone industry gave consumers access to different suppliers of long-distance service. Unfortunately, in many regions the cheapest source of electricity tends to be coal-fired power plants that pose major threats to human health and Earth's climate from their high emissions of air pollutants and carbon dioxide. Without special financial provisions to take into account these environmental and health impacts, electric power deregulation can be expected to decrease demand for clean, renewable (albeit somewhat more expensive) energy sources such as photovoltaic cells and windpower. This could diminish investment in these power sources and slow the technological advances that would bring prices down. If this happens, the development of affordable, climate-friendly renewable energy substitutes for fossil fuels could be slowed down for years. Whether or not lower energy prices resulting from restructuring are economically justified given the likely impacts on climate and air pollution, the environmental issues have barely entered the policy debate.
The time to consider the policy dimensions of climate change is not when the link between greenhouse gases and climate change is conclusively proven... but when the possibility cannot be discounted and is taken seriously by the society of which we are part. We in BP have reached that point.
John Browne, CEO, British Petroleum
As another example, consider the potential multiple benefits if the United States were to take strong steps to reduce carbon dioxide emissions - through improved energy efficiency or fuel substitution, for example. Many such measures would also tend to reduce emissions of air pollutants such as sulfur dioxide and nitrogen oxides. Preliminary estimates are that they could be significant. The UN's Intergovernmental Panel on Climate Change (IPCC) estimates that benefits, such as reduced air pollution, could offset between 30 and 100 percent of climate abatement costs.1 In other words, actions to reduce U.S. greenhouse gas emissions to protect the climate could also substantially aid our efforts to achieve air quality and other national goals. Yet, few of the economic models being used to examine climate protection policies have factored in the associated economic, health, and environmental benefits of reduced air pollution2. Similarly, cutting oil consumption through strong climate policies would help reduce energy security risks. But, here too, economic models do not estimate these reductions nor the potential averted economic and human costs of military conflicts in the Persian Gulf.
Clearly, there are win-win opportunities that are being ignored in the struggles to deal with these closely linked threats. In the following pages, as we explore these energy-related issues in more detail, it will become clear how and why these problems are interrelated, why there are benefits in addressing them as a package, and what kinds of technological and policy goals are appropriate to guide national decision-makers in resolving them.