Days before Donald Trump becomes president, fear is running high that climate denial in the White House will accelerate global warming. At this pivotal moment, when the world is committed to fighting climate change through the breakthrough U.N.’s Paris Agreement, California can trump climate denial by pushing forward faster than ever.
The story from Lazard’s 10th annual report on levelized cost of energy (LCOE) is clear. Rapid technology cost reductions mean wind and solar are now the cheapest form of generation in many places around the country, without federal subsidies like tax credits. The time is now to radically adjust for a paradigm where wind and solar form the backbone of our electricity grid.
Back in January, I suggested 2016 was the year for wholesale power market reform. So, was it? While shifts in these kinds of institutions take longer than one year, we’ve seen real progress on the four factors that made 2016 a turning point, and we believe progress will continue in 2017.
While President-Elect Trump may try reversing climate policy, other forces are reducing emissions without pause. Technology, economics, and state policy will increasingly force fossil fuels to remain where they belong: in the ground. The reality is most of the world’s coal, oil, and natural gas will remain buried underground forever, no matter who occupies the White House.
Donald Trump’s election and presidential transition has revived debate over the roles various energy sources should play in a secure, reliable, affordable and clean U.S. electricity system. Moving beyond rhetoric, actual data show the market forces driving clean energy are likely to continue, regardless of federal policy under a President Trump. Let’s look at the numbers.
With future federal clean energy policies in doubt, proactive clean energy policy will likely be left largely to states in the next few years. Fortunately, a New York policy proposal could show the way forward on energy efficiency for utilities. An outcome-oriented metric would focus on the policy goal of reduced energy use overall, putting a smaller emphasis on the administratively intensive business of attributing savings to specific actions.
Land-constrained Northeastern states looking for creative solutions to decarbonize their electricity system and maintain affordable, reliable electricity service have renewed interest in an old resource: imported Canadian hydroelectricity. Two recent policies from Massachusetts and New York have spurred this interest:
California fortified its role as a global leader in climate policy with the passage of Senate Bill (SB) 32 and Assembly Bill (AB) 197 on Sept. 8, establishing a new ceiling on emissions in 2030 under SB 32 – 40 percent below 1990 levels. While these new laws clearly demonstrate California’s unprecedented ambition to decarbonize its economy, they also raise questions about their implications for California’s cap-and-trade system.
It is highly likely that California’s cap-and-trade program post-2020 will be enabled under the state’s new SB-32 and AB-197 bills, as it is a necessary part of a policy package maximizing net social benefits. However, policymakers will have to make some adjustments to cap-and-trade program design regarding, for example, new limits on out-of-state offsets and how allowances are to be allocated post-2020.
California has fortified its role as a global leader in climate policy with passage of Senate Bill (SB) 32 and Assembly Bill (AB) 197. On Sept. 8, Governor Jerry Brown signed these bills into law, establishing a new ceiling on emissions in 2030 under SB 32 – 40% below 1990 levels – and new rules guiding regulators on how to accomplish emission reductions.