Stepping backward — again — on the climate

It has been a bad month for the fight against climate change. Amid heat waves, wildfires, droughts and Arctic ice melt, President Donald Trump has taken aim at the two central pillars of his predecessor’s ambitious efforts to reduce carbon dioxide emissions. After proposing in early August to freeze a scheduled increase in fuel economy standards for cars and light trucks, the Trump administration on Aug. 21 said it would seek to significantly weaken the Obama-era Clean Power Plan, aimed at reducing greenhouse gas emissions from coal-fired power plants.

Those two economic sectors — transportation and electricity production — are the biggest contributors to greenhouse gas emissions in the United States, accounting for 56 percent of the total.

In taking on the Clean Power Plan, Trump says he wants to save coal, but the reality is that coal is not coming back. Market forces conspire against it. Even without any policy, the economic imperatives driving the transition to cleaner fuels are expected by 2030 to reduce carbon dioxide emissions in the power sector by 33 percent of their 2005 levels, according to the Environmental Protection Agency. With the Obama plan, the reduction would be 36 percent; with the Trump administration’s new Affordable Clean Energy Rule, it would be 33 percent to 34 percent.

Coal’s decline is being driven far less by government regulation than by cheap natural gas prices and the falling costs of renewable energy. Therefore, scrapping Obama’s Clean Power Plan can’t save coal — although the Trump administration’s misguided plan to subsidize uncompetitive coal plants could, at least in the short term.

So why does this proposed rollback of power sector climate regulations matter if it won’t change the carbon emissions trajectory much?

First, firm policy direction from the government provides investors and utilities with certainty about the investment outlook and ensures emissions reductions even if the market shifts. Just as few predicted the collapse in natural gas prices a decade ago, there is a wide range of uncertainty about what energy prices will look like in the future.

The Energy Information Administration projects that market forces alone will lead in 2030 to power sector emissions 28 percent below their 2005 level. This reflects the agency’s assumptions that natural gas prices will rise roughly 50 percent from their current levels and that improvements in renewable and electricity storage technologies will proceed conservatively.

By contrast, the Rhodium Group, an independent research firm, assumes in its baseline scenario that today’s low natural gas prices will persist and that renewable costs will continue to fall at their recent pace, and finds that power sector emissions will be 35 percent lower in 2030.

Second, the right way to assess whether a policy makes sense is not just to look at its emissions impacts but also to compare its costs with its benefits. Even by the current EPA’s own analysis, which makes assumptions that downplay the climate benefits and increase the implementation costs, the Clean Power Plan delivered far more net benefits for the American people than the proposed replacement. That is because reducing coal use in the power sector not only delivers carbon emission reductions but also lower levels of local pollutants like particulate matter.

Third, and most important, even though the Clean Power Plan fell far short of the emission reductions needed to avoid severe climate change impacts, it was a starting point to clean up the power sector. It would send investment signals and provide a foundation for deeper reductions in carbon dioxide emissions to meet the globally agreed upon target of limiting temperature rise to well below two degrees Celsius, or 3.6 degrees Fahrenheit.

For instance, a carbon tax starting at $50 per ton (which is roughly the Obama administration’s estimate of the cost of harm from carbon emissions) would result in power sector emission reductions in 2030 relative to 2005 that are roughly twice what they would be under the Clean Power Plan, according to an analysis I helped to prepare for the Center on Global Energy Policy at Columbia University.

Neutering the Clean Power Plan is a major step backward. But what’s most important to remember is that even if a future president puts back in place President Obama’s climate policies, more comprehensive and stringent policies are still needed to deal with the rising threats of climate change that we see all around us. That reality is understood by the American public and increasingly even among oil companies and some Republicans who have come out in favor of a carbon tax.

The damage done by the Trump administration’s reversal of President Obama’s climate policies is less a sharp rise in carbon emissions than it is the loss of American leadership and missed opportunity to save future generations from climate change’s severe impacts.