CHAPTER THREE
Opportunities for Limiting Future Climate Change

In Chapter 2 we recommended that the United States adopt a budget for cumulative greenhouse gas (GHG) emissions, and in this chapter we evaluate the opportunities and challenges involved in meeting this budget. To make this evaluation, we first examine a wide array of opportunities for reducing CO2 emissions from U.S. energy consumption (summarizing only briefly the topics that are addressed in detail in the National Research Council [NRC] study America’s Energy Future1), as well as enhancing CO2 sequestration and reducing emissions of other GHGs. We then examine whether aggressively exploiting near-term emissions-reduction strategies (using technologies available now or in the near future) can yield the kinds of emissions reductions needed to achieve the budget goals. Gauging the prospects of technology in this way, even in a very general sense, is essential for understanding the urgency and nature of policy actions needed. Finally, we consider how the technological advancements highlighted in this chapter fit into a larger set of research questions about the interplay of technology with social and behavioral dynamics. Chapter 4 examines the policy approaches needed to exploit the emissions-reduction opportunities highlighted here.

OPPORTUNITIES FOR LIMITING GHG EMISSIONS

CO2 emissions from fossil fuel combustion in the energy system account for approximately 82 percent of total U.S. GHG emissions. The amount of fossil fuels consumed is driven by economic, population, and demographic factors that affect overall demand for goods and services that require energy to produce or deliver; by the efficiency with which the energy is used to provide these goods and services; and by the extent to which that energy comes from fossil fuels (i.e., the carbon intensity of energy supplied). Opportunities exist in each of these areas to reduce CO2 emissions. In addi-

1

America’s Energy Future consisted of three panel reports: (1) Electricity from Renewable Resources: Status, Prospects, and Impediments, (2) Liquid Transportation Fuels from Coal and Biomass, and (3) Real Prospects for Energy Efficiency in the United States, and an overarching report, America’s Energy Future: Technology and Transformation (NRC, 2009a). More information is available at http://sites.nationalacademies.org/Energy/, and all reports are available at http://www.nap.edu.



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CHAPTER THREE Opportunities for Limiting Future Climate Change I n Chapter 2 we recommended that the United States adopt a budget for cumula- tive greenhouse gas (GHG) emissions, and in this chapter we evaluate the oppor- tunities and challenges involved in meeting this budget. To make this evaluation, we first examine a wide array of opportunities for reducing CO2 emissions from U.S. energy consumption (summarizing only briefly the topics that are addressed in detail in the National Research Council [NRC] study America’s Energy Future1), as well as enhancing CO2 sequestration and reducing emissions of other GHGs. We then exam- ine whether aggressively exploiting near-term emissions-reduction strategies (using technologies available now or in the near future) can yield the kinds of emissions re- ductions needed to achieve the budget goals. Gauging the prospects of technology in this way, even in a very general sense, is essential for understanding the urgency and nature of policy actions needed. Finally, we consider how the technological advance- ments highlighted in this chapter fit into a larger set of research questions about the interplay of technology with social and behavioral dynamics. Chapter 4 examines the policy approaches needed to exploit the emissions-reduction opportunities high- lighted here. OPPORTUNITIES FOR LIMITING GHG EMISSIONS CO2 emissions from fossil fuel combustion in the energy system account for approxi- mately 82 percent of total U.S. GHG emissions. The amount of fossil fuels consumed is driven by economic, population, and demographic factors that affect overall demand for goods and services that require energy to produce or deliver; by the efficiency with which the energy is used to provide these goods and services; and by the extent to which that energy comes from fossil fuels (i.e., the carbon intensity of energy sup- plied). Opportunities exist in each of these areas to reduce CO2 emissions. In addi- 1 America’s Energy Future consisted of three panel reports: (1) Electricity from Renewable Resources: Sta- tus, Prospects, and Impediments, (2) Liquid Transportation Fuels from Coal and Biomass, and (3) Real Prospects for Energy Efficiency in the United States, and an overarching report, America’s Energy Future: Technology and Transformation (NRC, 2009a). More information is available at http://sites.nationalacademies.org/Energy/, and all reports are available at http://www.nap.edu. 

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L I M I T I N G T H E M A G N I T U D E O F F U T U R E C L I M AT E C H A N G E FIGURE 3.1 The chain of factors that determine how much CO2 accumulates in the atmosphere. Each of the boxes represents a potential intervention point. The blue boxes represent factors that can potentially be influenced to affect the outcomes in the purple circles. tion, atmospheric CO2 concentrations can be altered by managing carbon sinks and sources in the biosphere and by chemical means that withdraw CO2 from the atmo- sphere (post-emission carbon management). Figure 3.1 summarizes these major areas of opportunity, or potential points of intervention, in the effort to reduce atmospheric GHG concentrations. Each of these intervention points is discussed individually in the following sections, but it should be acknowledged that, in some instances (for exam- ple, in shaping future urban development patterns), major advances will require sys- tems-level solutions, involving intervention at several of these points simultaneously. Influencing Demand for Goods and Services that Require Energy The first box in Figure 3.1 identifies various factors that have been shown to influence the overall level of demand for goods and services in an economy. Curbing U.S. popu- lation growth (either through policies to influence reproductive choices or immigra- tion), or deliberately curbing U.S. economic growth, almost certainly would reduce en- ergy demand and GHG emissions. Because of considerations of practical acceptability, however, this report does not attempt to examine strategies for manipulating either of these factors expressly for the purpose of influencing GHG emissions. An issue of key relevance is the practicality and acceptability of intervening to alter consumer behavior and preferences in ways that would reduce the demand for goods and services that result in energy consumption and GHG emissions. (We note this is different from the question explored in the following section: how to meet demand 

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Opportunities for Limiting Future Climate Change for goods and services in a way that uses less energy and/or emits fewer GHGs per unit of output.) What is the potential for changing consumer behavior and prefer- ences? The United States has larger per capita energy use than many other countries with an equal or higher standard of living, such as Japan and most European countries. This differential is no doubt due to a variety of economic, demographic, geographic, and cultural factors, including differences in energy prices and energy efficiency. The extent to which the gap derives from differences in consumer desires for energy-in- tensive goods and service is less clear. Consumer choices among market offerings in different societies shape demand for everything from living space and electric appliances to dietary choices. For instance, the social dynamics leading to larger, more dispersed dwellings, manifest in suburban development, is an important factor in contemporary U.S. energy use. The pattern of low-density suburban development gained momentum in the 19th century with the advent of electric street cars, and it accelerated during the mid-20th century after the widespread introduction of automobiles and freeways lowered the cost of living and working farther from city centers. Social preferences for lower density and more living space thus have deep roots in American society, and changing these patterns can be extremely challenging. Yet many of America’s central cities and inner-ring suburbs have remained vital over the past century; many urban planners and advocates for “smart growth” find that interest in denser development is growing. For instance, as the population ages, many older people seek smaller homes closer to amenities and services (Myers and Gearin, 2001). Immigrant groups have also tended to migrate to central cities and inner suburbs. Technologies that lower the cost of living in denser communities (for instance, quality, affordable transit, and car-sharing programs) have been proposed as an impetus for more compact living and working environments (Sperling and Gordon, 2009). Box 3.1 summarizes key findings from a recent NRC study that evaluated the linkages among urban development patterns and GHG emissions in depth. Environmental awareness about energy security and global climate change are on the rise (Curry et al., 2007). Levels of concern fluctuate with the changing importance of other social, economic, and environmental issues, and the strength of concern varies across segments of the population (Leiserowitz et al., 2008). But it remains clear that much of the U.S. population views climate change as an important public policy prob- lem (Pew Center, 2009a). As Americans become increasingly informed about climate change, does this concern translate into new consumption patterns? Social science research in this area suggests that information and attitudes alone are unlikely to prompt the sorts of changes in long-standing patterns of technology use 

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L I M I T I N G T H E M A G N I T U D E O F F U T U R E C L I M AT E C H A N G E BOx 3.1 Urban Development and Transportation Energy Demand Sprawling, automobile-dependent development patterns are a major factor underlying U.S. dependence on petroleum and thus much of our GHG emissions. There is growing interest in the idea that more compact, mixed-use development will reduce vehicle miles traveled (VMT), make alternative modes of travel more feasible, and thus offer an important strategy for reducing CO2 emissions. The NRC Transportation Research Board (TRB) recently examined this question of whether petroleum use and GHG emissions could be reduced by changes in development pat- terns. Below is a brief overview of some key findings (from NRC, 2009d). Developing at higher population and employment densities means trip lengths will be shorter on average, walking and bicycling can be more competitive alternatives to the automobile, and it is easier to support transit. Increasing density alone, however, is generally not sufficient to reduce VMT by a significant amount. A diversity of land uses that result in desired destinations (e.g., jobs, shopping) being located near housing, and improved accessibility to these destinations, are also necessary. Development designs and a street network that provides good connectivity between locations and accommodates nonvehicular travel are important. Finally, demand management policies such as lowering parking requirements and introducing market-based parking fees are also needed. The effects of compact development will differ depending on where it takes place: Increasing density in established inner suburbs and urban core areas is likely to produce substan- tially more VMT reduction than developing more densely at the urban fringe. The TRB committee developed illustrative scenarios to estimate the potential effects of more compact, mixed-use development on reductions in energy consumption and CO2 emissions. An “upper bound” scenario (with 75 percent of new housing units steered into more compact de- velopment and residents of compact communities driving 25 percent less) could lead to reduced VMT and associated fuel use and CO2 emissions by about 7 to 8 percent less than the base case by 2030, and 8 to 11 percent less by 2050. A more moderate scenario (with 25 percent of new housing units built in more compact development and residents of those developments driving 12 percent less) could lead to reductions in fuel use and CO2 emissions of about 1 percent by 2030, and 1.3 to 1.7 percent by 2050. Overall then “the committee believes that reductions in VMT, energy use, and CO2 emissions resulting from compact, mixed use development would be in the range of ~1 to 11 percent by 2050, although the committee members disagreed about whether the changes in development patterns and public policies necessary to achieve the high end of these findings are plausible.” It is important to keep in mind, however, that these potential emissions reductions result- ing from land-use changes would be occurring in the context of an overall increasing baseline of VMT; thus, even at the high end of the optimistic scenario, VMT in 2050 may be higher than it is today. 

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Opportunities for Limiting Future Climate Change and consumption of energy-intensive goods that are required for making significant reductions in GHG emissions. For example, fostering significant progress in residential energy conservation requires not only changes in public awareness and concern but also changes in market product offerings and changes in the behavior of both produc- ers (home builders) and consumers (home buyers or renters) (Lutzenhiser et al., 2009; Stern, 2008). Long-term sustained changes will be driven by the interactions of tech- nology markets, the policy environment, and consumer choices. Changes in the demand for goods and services are an expected and desired outcome of carbon pricing strategies—especially through the substitution of more energy- efficient goods and production processes. However, until such a system is enacted at broad scales, it remains unclear just how much consumer behavior and overall demand for goods and services can be modified through prices alone. Consumer responses to financial incentives in the past have been highly variable. The largest impacts are seen in cases where complementary policies and nonfinancial incentives have also been provided (Gardner and Stern, 2002; Stern, 1986). Public interest supported by thoughtful policy and good communication has been shown to be an effective combination for changing consumer behavior (NRC, 2005). The long-term successes from sustained public health information campaigns, cou- pled with disincentives and penalties (e.g., in the cases of smoking and drunk driving), suggest that public attitudes can be modified over time in ways that significantly affect behavior and demand. Public policies devised to reinforce changes that are already occurring in public attitudes and consumer preferences are likely to be more effective in bringing about the changes needed to dramatically lower GHG emissions. For instance, many processes involved in water consumption require a significant amount of energy. The energy used to pump and purify water, make hot water, and treat wastewater is a large driver of electricity use for many municipal governments. Sensitivity to water use in some parts of the country is already high as a result of past droughts and increasing water scarcity. In these places, state and local governments have developed significant expertise in building effective communication and policy strategies. Publicity campaigns and other actions to promote water conservation may thus be an area where public policy could contribute to reducing energy demand. The same is true for residential energy conservation, where some states and locales have long-standing commitments and significant expertise in interventions that combine technology and behavior change to reduce demand for electricity and natural gas— although considerable work remains to be done in this area (Lutzenhiser et al., 2009). 

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L I M I T I N G T H E M A G N I T U D E O F F U T U R E C L I M AT E C H A N G E Improving the Efficiency of Energy Use Many opportunities exist to improve the efficiency of energy use. Total U.S. energy consumption today is 40 percent higher than it was in 1975. At the same time, energy intensity, measured as energy use per dollar of gross domestic product, has steadily fallen, averaging a decline of 2.1 percent per year (NRC, 2009a). About 70 percent of the decline in energy intensity is estimated to have resulted from improvements in en- ergy efficiency (IEA, 2004). If current trends continue, U.S. energy intensity would drop by 36 percent over the next two decades. Despite these impressive gains, however, almost all other developed nations continue to use significantly less energy per capita than the United States (NRC, 2009a). What is the potential for further gains in U.S. energy efficiency? Most analysts believe that the technical potential in the aggregate is large and much of it can be realized, especially if the price of energy increases. Judgments about the technical potential for energy-saving technologies and practices and their deployment to common use, however, are often fraught with uncertainty. Indeed, it has long been perplexing why consumers and businesses do not take greater advantage of what seem to be cost-ef- fective energy-efficiency opportunities, that is, why they do not choose technologies that appear to quickly “pay for themselves” in energy cost savings. A new technology that appears promising may encounter various market barriers that hinder its imple- mentation, or the technology itself may be lacking some important attribute (e.g., in reliability, durability, function) that makes it less cost-effective than expected. Regard- less, consumers may be slow to adopt a new technology because of uncertainty about real-world savings potentials, future energy prices, and the prospects of even better technologies coming to market in the future. A host of market and institutional barriers have been identified in the literature (Brown et al., 2007; DOE, 2009). For example, in the “principal/agent problem,” those paying for the technology and those benefiting from it are not the same. This barrier is significant and widespread in many energy end-use markets (Prindle, 2007). The land- lord-tenant relationship is the classic example: If a landlord buys the energy-using ap- pliance while the tenants pay the energy bills, the landlord is not motivated to invest in efficiency. Often monthly energy costs are included in the rent, providing the tenant with no incentive to conserve. About 90 percent of all households in multifamily buildings are renters, which makes this a major obstacle to energy efficiency in urban housing markets. Conflicting landlord and tenant motivations are also a problem with commercial buildings, many of which are rented or leased. In addition, many build- ings are occupied by a succession of temporary owners or renters, each unmotivated 

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Opportunities for Limiting Future Climate Change to make long-term improvements that would mostly reward subsequent occupants (Brown and Southworth, 2008). Other obstacles can stem from the lack of basic information, such as consumers not knowing how a particular appliance may be affecting their monthly household elec- tricity bill. Moreover, given the early stage of deployment (at least in the United States) of many energy-efficient technologies (e.g., cogeneration, light-emitting diodes, and plug-in hybrid electric vehicles), obtaining reliable information can be costly, time-con- suming, and perhaps not possible (Worrell and Biermans, 2005). Such market barriers have long been used to justify public policies devoted to boosting energy efficiency, prominent examples being the Corporate Average Fuel Economy (CAFE) program, Energy Star, appliance and vehicle labeling requirements, and building energy codes (DOE, 2009). Some barriers to adoption of energy-efficient technologies result from government regulations, subsidies, and penalties that were designed to address goals in areas other than energy. Risk aversion often limits the variety of technologies offered in the market. Constraints can also be imposed through various community standards and practices, such as homeowner association rules that require the use of particular ma- terials and design elements or that prohibit others (e.g., white roofs, clotheslines, and shade trees). The NRC study America’s Energy Future (AEF) (NRC, 2009a,b) included a comprehensive review of energy-efficient technologies and processes in the sectors of industry, resi- dential and commercial buildings, and transportation. The goal was to identify energy- saving technologies and practices that are currently ready for implementation, that need further development, or that exist just as concepts but are sufficiently promising to offer major efficiency improvements in the future. Overall, AEF estimates that the potential cost-effective energy savings range (from the conservative to the optimistic) from 18.6 to 22.1 quads2 in 2020 and from 30.5 to 35.8 quads in 2030. Comparing this to the Energy Information Administration (EIA, 2009) forecast for “business as usual” consumption (105.4 quads in 2020 and 113.6 quads in 2030), this means a potential for savings of 18 to 21 percent in 2020 and 27 to 32 per- cent in 2030. This more than offsets the EIA’s projected increases in energy consump- tion through 2030, but it still falls short of achieving the very large GHG emissions reductions needed overall. 2 A quad is a unit of energy equal to 1.055 × 1018 joules (1.055 exajoules or EJ). It is a unit commonly used in discussing global and national energy budgets. 

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L I M I T I N G T H E M A G N I T U D E O F F U T U R E C L I M AT E C H A N G E Many studies, including the AEF assessment, examine efficiency opportunities by en- ergy-use sector, such as transportation, industry, and buildings, and so we follow this construct below. Another useful vantage point, however, is to focus on the perspective of the actors actually making investment and purchase decisions, such as the house- hold-level actions discussed in Box 3.2. BOx 3.2 Household-Level Actions to Increase Conservation and Energy Efficiency It has been estimated that households contribute roughly 40 percent of national GHG emis- sions through direct energy use in homes and nonbusiness travel, plus an additional 25 percent indirectly through GHGs emitted in the production, distribution, and disposal of consumer goods and services (Bin and Dowlatabadi, 2005; Gardner and Stern, 2008). There are a variety of ways in which household-level actions can enhance energy conservation and efficiency. Analyses find that the greatest potential to lower direct household energy use occurs in two main areas: (1) the choice of more energy-efficient motor vehicles and (2) home space conditioning technology (insulation, windows, furnaces, and air conditioners). Gardner and Stern (2008) estimate that these two types of efficiency improvement can save nearly 20 percent of total household energy consumption each, for an average household that has not already undertaken the action. Dietz at al. (2009) found that, aggregated across all U.S. households, the technical potential for emissions reduction is approximately 9 percent for phasing in more fuel-efficient vehicles, 6 percent for home weatherization and adoption of more efficient space conditioning equipment, 5 percent for more efficient household appliances, and 5 percent for universal adoption of compact fluorescent lighting. The study suggests that, with effective incentive programs, the great bulk of these efficiency improvements could realistically be achieved. In addition, Dietz et al. found emissions-reduction opportunities (of ~17 percent of household direct emissions) resulting from changes in the maintenance and use of household equipment. However, they note that some of these additional changes—such as carpooling—are often resisted because they are seen as sacrificing time, comfort, or convenience. Policies designed to achieve optimal short-term emissions reductions will need to take into account the different opportuni- ties and constraints associated with different kinds of behavioral change. A recent Department of Energy (DOE) effort examining federal policies to reduce CO2 emis- sions in the residential sector (based on current knowledge of behavioral barriers) found that greater understanding of household behavior is needed to optimize the design of such policies (Brown et al., 2009a). 

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Opportunities for Limiting Future Climate Change Building-Sector Efficiency The AEF committee concluded that the buildings sector (including both private hous- ing and commercial buildings) offers the greatest potential for energy savings from efficiency gains. Most energy use in the building sector is in the form of electricity, followed by natural gas. There are numerous options to reduce this energy use, rang- ing from simple insulation and caulking to highly sophisticated appliances (Granade, 2009). Take lighting as an example: Solid-state lighting is an important emerging technol- ogy with significant energy-savings potential. Compact fluorescent lights are a major improvement over incandescent lamps with respect to efficiency, but they have dis- advantages in other respects (e.g., they contain mercury, are difficult to dim, are not a point light source, and are not “instant on”). Light-emitting diodes (LEDs) do not suffer from these disadvantages, and the best LEDs are now more efficient than fluorescent lamps (Craford, 2008). DOE (2006a) projects that LEDs will yield a 33 percent savings by 2027, relative to projected lighting energy use without LEDs. Since lighting accounts for about 18 percent of primary energy use in buildings, the savings from this one technology alone could amount to 6 percent of energy use in buildings by 2027. Examples of other promising technologies (which can be applied to the existing build- ing stock as well as new construction) are reflective roof products, advanced window coating, natural ventilation, and smart heating and air-conditioning control systems. Technologies available to reduce consumption in water heating (the second largest consumer of energy in homes) include alternative heat pump water heaters, water heating dehumidifiers, solar water heaters, and tankless water heaters (Brown et al., 2007). The efficiency of cooling buildings can also be aided by design strategies such as planting shade trees and replacing blacktop roofs with light-colored materials that reflect away more sunlight and drastically reduce heat absorption. Collectively, existing technology opportunities for residential buildings could save over 500 terawatt hours (TWh) per year, more than one-third of the electricity now used in residences and about twice the growth expected by 2030 (EIA, 2009).3 The commercial sector should be able to show even greater savings, about 700 TWh (Brown et al., 2008). 3 It should be noted that new homes comprise roughly 1 percent of the housing stock in any given year, leaving much of the opportunity for energy and GHG reductions to the rehabilitation of existing homes and disclosures at the time of their sale or lease. 

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L I M I T I N G T H E M A G N I T U D E O F F U T U R E C L I M AT E C H A N G E Industrial-Sector Efficiency There are numerous examples of how advanced sensors, intelligent feedback, and continuous process controls can offer industry-wide energy-savings potential. For example: • In the papermaking industry, fiber optic and laser sensors can monitor water content, sheer strength, and bending stiffness of paper, both saving energy and improving paper quality (see http://www.physorg.com/news4221.html). • Blending fly ash, steel slag, and other recycled materials with cement could cut energy consumption in the cement industry by 20 percent (Worrell and Galitsky, 2004). • Data indicate that most U.S. petroleum refineries can economically improve distillation efficiency by 10 to 20 percent with improved systems such as gas separation technologies, corrosion-resistant metal- and ceramic-lined reac- tors, and sophisticated process control hardware and software (DOE, 2006b; Galitsky et al., 2005). • Motors, the largest single category of electricity end use in the U.S. economy, offer considerable opportunity for electricity savings through technology upgrades and system efficiency improvements (achieved by selecting the appropriately sized and most efficient available motor for the application at hand). Next-generation motor and drive improvements, including the use of superconducting materials, are currently under development (NRC, 2009a). The AEF committee pointed out that many of these approaches provide multiple ancillary benefits such as improved productivity, product enhancements, and lower production costs. They recognized, however, that risk aversion and uncertainty over future prices for electricity and fuels can lead many firms to defer decisions on energy- efficiency investments. The concern with such deferrals is that, once an asset is in- stalled, it locks in a fixed level of energy efficiency for years or even decades (IEA, 2008). This adds to the importance of aggressively pursuing “windows of opportunity” to put efficient technologies and systems in place. NRC (2009b) estimates that investments in available efficiency technologies (including growth in combined heat and power pro- duction) could reduce energy consumption in the industrial sector by 14 to 22 percent (about 4.9 to 7.7 quads) over the next decade. 0

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Opportunities for Limiting Future Climate Change Transportation-Sector Efficiency Concerns over U.S. dependence on imported oil provide an additional motivation for increasing energy efficiency (see Chapter 6). Cars and light trucks are the main source of energy consumption in the U.S. transportation sector, accounting for ~65 percent of fuel use. Improving automobile fuel economy has thus been a central focus of federal energy policies dating back more than 30 years to the establishment of the Corporate Average Fuel Economy (CAFE) Program. Most recently, the 2007 Energy Independence and Security Act (EISA) mandates substantial increases in the CAFE fuel economy standards for new cars and light trucks sold over the next decade, requiring a com- bined 35 miles per gallon for vehicles sold in 2020 (representing a 40 percent increase from today). In September 2009, the Obama Administration proposed GHG emissions performance standards for new cars and light trucks that are intended to accelerate these fuel economy gains. The AEF report concluded that these increases in vehicle fuel economy will be diffi- cult but possible to meet, since many technologies are available that could be imple- mented at relatively modest cost. Some are already in use and could be expanded rap- idly over the next decade (e.g., cylinder deactivation, direct injection, diesel engines, and hybrid electric vehicles). Others, such as plug-in hybrid electric vehicles, have the potential to start penetrating the market during the next decade, possibly leading to all-electric battery vehicles. The report stresses, however, that there is no assurance these improvements will be introduced on a wide scale in this time frame, especially if motor fuel prices do not rise and create incentives for consumers to demand more energy-efficient vehicles. The question of whether more stringent fuel-efficiency standards would be warranted at a later date depends upon how the policy environment and technological capabili- ties evolve in the next two decades, as discussed further in Chapter 4. Overall, NRC (2009a) estimates an approximate energy-savings potential for light-duty vehicles of 2.0 to 2.6 quads in 2020 and 8.2 to 10.7 quads in 2030. However, even if such increases in vehicle fuel economy do occur, growing amounts of personal travel by automobile will likely cause overall emissions from cars and light trucks to increase in the coming decades. EIA (2009) projects that light-duty vehicles will use 16.53 quads of energy in 2030 compared to 16.42 quads today. Thus, additional opportunities for reducing GHG emissions must be considered. This includes direct efforts to reduce travel demand (discussed in the previous section) and expanded use of alternative fuels (discussed in the following section), as well as strategies for increasing efficiency in other areas of transport sector (discussed in Box 3.3). 

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L I M I T I N G T H E M A G N I T U D E O F F U T U R E C L I M AT E C H A N G E HFCs for semiconductor manufacture, and SF6 for electrical transmission and distribution and for magnesium production and processing. Voluntary pro- grams for all these applications have succeeded in reducing U.S. emissions from about 35 MMT CO2-eq in 1990 to 20 MMT CO2-eq in 2007. Future reduc- tion potential is uncertain. 3. Capturing and destroying compounds. Even though the consumption of some of the most widely used ozone-depleting substances (chlorofluorocarbons [CFCs]) has been phased out, significant banks of the compounds still exist in refrigeration and air-conditioning equipment and in insulating plastic foams. Destruction costs using approved technologies range from $2.75 to $11 per kg of the CFC, not accounting for the additional cost of recovery, storage, and transportation (IPCC/TEAP, 2005). Due to the high GWP of these compounds, their capture and destruction can be cost-effective (on a per ton CO2-eq basis); for example, if it cost $10 to capture and $10 to destroy CFC-12, then the cost is approximately equivalent to $2 per ton CO2-eq. The size of this emissions- reduction opportunity is rapidly diminishing with time as the remaining CFCs continue to leak from systems worldwide. Controlling these leaks would help mitigate ozone depletion and help limit the magnitude of future climate change. Short-Lived Radiative Forcing Agents Most discussion on limiting the magnitude of climate change focuses on “well-mixed” GHGs that persist in the atmosphere for periods ranging from years to centuries (even millenia, for the PFCs). Although less frequently mentioned in climate discourse, reducing atmospheric concentrations of short-lived atmospheric pollutants (namely, tropospheric ozone and black carbon particles) may offer a cost-effective near-term strategy for limiting the magnitude of climate change, while at the same time produc- ing substantial benefits for air quality. Tropospheric ozone (O3) is itself a strong GHG, but it also plays a key role in atmospheric chemistry, affecting the lifetimes and hence the concentrations of several other impor- tant GHGs, including CH4, HCFCs, and HFCs. O3 is not emitted directly but is produced in the atmosphere via reactions among its precursors: nitrogen oxides (NOx), carbon monoxide (CO), methane (CH4), and nonmethane hydrocarbons. Thus, controlling O3 requires controls on the emissions of these precursors. Some ozone precursor emis- sions (from sources such as vehicles, factories, power plants, consumer products, and paints) are currently controlled through provisions of the Clean Air Act. Since CH4 is a precursor for O3 formation on a broad regional level (as opposed to the context of 0

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Opportunities for Limiting Future Climate Change concentrated urban air pollution), there are multiple reasons for pursuing strategies that reduce CH4 emissions from industrial, energy, and agricultural systems. This would not only reduce the climate impacts of CH4 itself but also help lower the climate im- pacts of O3 ( West et al., 2006). Black carbon or “soot” not only causes strong direct warming in the atmosphere (on a localized scale) but also amplifies warming effects after deposition from the atmo- sphere because the resulting black coating on certain surfaces (such as arctic snow and ice) decreases the amount of incoming solar radiation these surfaces reflect back to space. Black carbon is emitted from the burning of fossil fuels, biofuels, and biomass. Diesel emissions account for 30 percent of black carbon globally and 50 percent in the United States. Technology for reducing soot emissions from diesel engines exists and is already mandated for new diesel vehicles in the United States. Reducing these emis- sions would have important domestic benefits for human health, but benefits at the international level are even more profound. For instance, replacing primitive biomass cookstoves that emit large amounts of soot with inexpensive, clean technologies could have enormous health benefits for the millions of people who suffer from this dangerous source of indoor air pollution (WHO, 2005). Including these sorts of short-lived compounds in a larger GHG emissions-reduc- tion effort does pose methodological challenges (for instance, it is difficult to apply the concept of GWPs and CO2-equivalent emissions to such species). Nonetheless, it has been suggested that focusing on these short-lived species could be particularly advantageous as a near-term bridging strategy for easing climate change during the time required for major CO2 emissions controls to come into play. It is especially attractive as an international strategy because low-income countries that view CO2 emissions reduction as a threat to their economic growth often see the control of pollutants such as O3 and soot as an immediate, obvious benefit. Also, because these short-lived pollutants are rapidly removed from the atmosphere, reducing emissions will have a near-immediate effect on lowering atmospheric concentrations. THE CASE FOR URGENCY Chapter 2 drew on the Energy Modeling Forum (EMF22) project to identify a represen- tative domestic GHG emission budget range of 170 to 200 Gt CO2-eq for the period 2012 through 2050, and earlier sections of this chapter identified a wide range of op- portunities for reducing domestic GHG emissions. Here we assess whether the techni- cal potential for domestic emissions reduction is sufficient to meet a domestic GHG budget in the suggested range (assuming, as discussed in Chapter 2, that international 

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L I M I T I N G T H E M A G N I T U D E O F F U T U R E C L I M AT E C H A N G E offsets are not used to meet the U.S. domestic GHG budget7). Based on this assess- ment, we conclude that meeting the representative U.S. GHG budgets may be feasible, but only if the nation acts with great urgency to deploy available technologies and to create new ones. This conclusion is based on two analyses described below. First, we find that the energy efficiency and energy production technologies available for near-term com- mercial use (i.e., by 2020) could attain the deployment levels required for meeting the emissions budget scenarios only under the most favorable circumstances. Because the margin for error is so thin, meeting the budget using only these technologies seems unlikely. Second, we find that, without prompt action, the current rate of GHG emis- sions from the energy sector would use up the domestic emissions budget well before 2050. In short, meeting the emissions budget scenarios considered in Chapter 2 means that the United States needs to start decarbonizing its energy system as soon as pos- sible but does not yet have in hand the suite of technologies needed to complete the task. We reiterate the point made in Chapter 2 that the U.S. emissions budget used in this analysis is based on “global least-cost” economic efficiency criteria and that cred- ible political and ethical arguments can be made for a more aggressive U.S. effort than the one we discuss in this section. To meet these more ambitious targets would, of course, be even more difficult. Feasibility of Decarbonizing the Energy System To assess the feasibility of decarbonizing the energy system, we compare the possible requirement for future energy efficiency and energy supply technologies with the likely availability of those technologies. Two recent studies, EMF22 and AEF, provide the data to make this comparison directly. Figure 3.3 shows a set of scenarios devel- oped in the EMF22 studies that illustrate the types of changes to the energy system that might be needed to reach an emissions budget of either 167 or 203 Gt CO2-eq by 2050.8 Below are the results of five different models, showing the energy technology mix projected for 2050 compared to the mix in the year 2000. There are large uncertainties associated with these sorts of projections, but the varia- 7 If the United States does rely heavily on the use of international offsets to meet an emissions budget, that would mean less stringent requirements for actually reducing domestic emissions; thus, the energy mix going forward would likely include a larger percentage of freely emitting fossil fuels than in the cases shown in Figure 3.3. 8 As noted earlier, the EMF-22 analysis cases are 167 and 203 Gt CO -eq, which we rounded to 170 and 2 200 Gt CO2-eq in Chapter 2. This difference does not significantly affect the conclusions of our analysis. 

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FIGURE 3.3 Model projections (from the EMF22 study) of the mix of energy technologies that may be used in 2050, under scenarios with emis- sion budgets of 203 and 167 Gt CO2-eq. For comparison, the first column in each graph shows the U.S. energy technology mix in 2000. A wide variety of future energy mix scenarios is possible, but all cases project a greater role for energy efficiency, renewable energy, fossil fuels with CCS, and nuclear power. SOURCES: Adapted from Fawcett et al. (2009); see also http://emf.stanford.edu for further details. 

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L I M I T I N G T H E M A G N I T U D E O F F U T U R E C L I M AT E C H A N G E tion among them illustrates that the United States has many plausible options for configuring its future energy system in a way that helps meet GHG emissions-reduc- tion goals. Note, however, that all cases involve a greater diversity of energy sources than exist today, with a smaller role for freely emitting fossil fuels and a greater role for energy efficiency, renewable energy, fossil fuels with CCS, and nuclear power. The vir- tual elimination by 2050 of coal without CCS—presently the mainstay of U.S. electric power production—in all the scenarios is perhaps the most dramatic evidence of the magnitude of the changes required. The AEF study estimated the technical potential of the rate at which key technologies can be deployed over the next 25 years, based on the committee’s judgments of when technologies will be available for commercial deployment and the likely maximum rate of deployment thereafter (see Box 3.6 for further explanation of “technical poten- tial”). In Table 3.2, these AEF technical potential estimates are compared with estimates from EMF22 studies of the technological deployment levels required for meeting the domestic emissions budget goals discussed in Chapter 2. Such an assessment is complicated by the considerable uncertainties involved in de- veloping scenarios for how the energy system might evolve in response to particular BOx 3.6 Defining Technical Potential Our discussion of technical potential refers to the definition developed by NRC (2009a) for the potential “accelerated deployment” options for various energy technologies. “Accelerated” refers to deployment of technologies at a rate that would exceed the reference scenario deploy- ment pace but at a less dramatic rate than an all-out crash effort. These estimates were based on the AEF committee’s judgments regarding two factors: (1) the readiness of evolutionary and new technologies for commercial-scale deployment and (2) the pace at which such technologies could be deployed without disruptions associated with a crash effort. In estimating these factors, the committee considered the maturity of a given technology, together with the availability of the necessary raw materials, human resources, and manufactur- ing and installation capacity needed to support its production, deployment, and maintenance. In some cases, estimates of the evolution of manufacturing and installation capacity were based on the documented rates of deployments of specific technologies from the past. Note that these estimates do not account for all of the barriers that could practically impede deployment of various technologies (e.g., social resistance and institutional limitations). Thus, the technical potential estimates should be viewed as an upper (optimistic) bound of what deployment level is truly feasible or likely. 

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Opportunities for Limiting Future Climate Change TABLE 3.2 Comparison of Projected Requirement (red) and Technical Potential for Deployment (blue) for Various Key Energy Technology Options, for the 167 and 203 Gt CO2-eq Budget Scenarios Energy Efficiency (% reduction from ref. case) 2020 2035 Requirement (EMF) for 167 Gt CO2-eq 2-21 5-33 Requirement (EMF) for 203 Gt CO2-eq 2-17 4-24 Potential (AEF) 15 30 Nuclear (Twh/y) 2020 2035 Requirement (EMF) for 167 Gt CO2-eq 868-1034 1292-2092 Requirement (EMF) for 203 Gt CO2-eq 869-1014 947-1629 Potential (AEF) 968 1453 Electricity with CCS (Twh/y) 2020 2035 Requirement (EMF) for 167 Gt CO2-eq 32-324 233-1593 Requirement (EMF) for 203 Gt CO2-eq 0-87 0-796 1200/1800a Potential (AEF) 74 Renewable Electricity (nonbiomass) (Twh/y)B 2020 2035 Requirement (EMF) for 167 Gt CO2-eq 194-688 453-1155 Requirement (EMF) for 203 Gt CO2-eq 194-593 459-971 Potential (AEF) 811 1454 Biomass Fuels (cellulosic) (mmgal/y) 2020 2035 Requirement (EMF) for 167 Gt CO2-eq 17,000-29,000 17,000-33,000 Requirement (EMF) for 203 Gt CO2-eq 15,000-23,000 17,000-35,000 Potential (AEF) 7,700 26,000 NOTE: AEF estimated technical potential out to 2020 and 2035, and so these years are used as benchmarks for the comparisons with EMF22 estimates. a 1200 is for retrofit or repower of existing plants; 1800 is for new plants. b Estimate is for total renewables, including current capacity and potential new capacity. Potential for 2020 is 10 percent of electricity production, in EIA (2010) as specified in AEF. Does not include hydropower. GHG emissions-reduction goals. This will depend on many factors, including the types of new policies implemented, the evolution of technology, and the degree to which the barriers particular to individual technology areas can be overcome. As a result, the different models show a wide range of estimates regarding deployment requirements for different technologies. Nonetheless, even taken in a very general sense, comparing 

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L I M I T I N G T H E M A G N I T U D E O F F U T U R E C L I M AT E C H A N G E the EMF22 and AEF estimates provides significant insights into the feasibility of decar- bonizing the energy system. Both the EMF technology requirements and the AEF technology potentials shown in the table are rough estimates. Taking that uncertainty into account, however, we feel the results are sufficiently robust to make the following observations: • For the electricity sector, meeting the 167 Gt CO2-eq budget would be challenging—requiring that nearly all technologies available to increase effi- ciency and decarbonize the energy system be deployed at levels close to their full technical potential. Meeting the 203 Gt CO2-eq budget is less challenging, but it is nevertheless still very demanding. If CCS can be demonstrated successfully and then deployed widely, this would likely make it feasible for the electricity sector to decarbonize fully. However, CCS has yet to be demonstrated in large- scale utility applications. If it proved to be infeasible, the remaining potential for efficiency, renewables, and nuclear would not be enough to meet electric- ity needs in 2035. Indeed, if any one of the major categories fails to approach its technical potential, meeting the electricity need would be very difficult.9 • For the transportation sector, meeting the deployment requirements for either budget scenario is particularly difficult. The technical potential for expanding the use of biomass fuels in transportation appears to be near the low end of what is required. The AEF study shows that, even if we could meet the full technical potential for both vehicle efficiency gains and alternate fuels use, there would still be a need for roughly one-third of the 2035 demand for trans- portation fuel to be met by oil.10 This suggests that further displacement of petroleum in the transportation sector will require additional strategies, such as significant deployment of pure or hybrid electric vehicles. • The AEF technical potential estimates are based on optimistic assumptions, so fall- ing short of them is quite likely. AEF does not account for nontechnical (i.e., so- cial or institutional) barriers to deployment; it assumes that the technologies, once adopted, operate at acceptable costs and performance. This provides further impetus to suggest that existing technology options are not likely to be sufficient, and there is an urgent need to enhance R&D aimed a creating new technology options. 9 The Electric Power Research Institute’s (EPRI’S) Prism analysis also estimates the technical potential for decarbonizing electric power production. EPRI’s estimates are similar to, and in some cases more conserva- tive than, the AEF estimates. Even so, EPRI regards its Prism results to be “very aggressive, but feasible if the proper investments in R&D are made (particularly around demonstration and early deployment)” (personal communication with Bryan Hannegan, Rhode Island) 10 See Figures 2.4, 2.11, and 2.12 of NRC (2009a) for the data on which this analysis is based. 

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Opportunities for Limiting Future Climate Change Inertia of Existing Infrastructure A second consideration underscoring the need for urgency is that the present energy infrastructure, if left unchanged, will rapidly deplete the GHG budgets discussed in Chapter 2. The reference case in EIA (2010) projects U.S. CO2-eq emissions to 2035, taking into account the accelerated CAFE standards announced in 2009 as well as the effect of the economic downturn of the past year. It projects annual emissions drop- ping to a low of 5.7 Gt CO2-eq in 2013 and then rising to 6.3 Gt CO2-eq in 2035. Cumu- latively from 2012, these emissions amount to 143 Gt CO2-eq by 2035. This represents 84 percent of the 170 Gt CO2-eq budget and 72 percent of the 200 Gt CO2-eq budget, thus substantially truncating the emissions budget for the remaining 15 years until 2050. Some of these emissions could potentially be sequestered through soil and for- estry management efforts, but this would slow depletion of the budget by only a few percent. And meanwhile, unchecked GHG emissions from other, nonenergy sources (which were not included in the EIA projections) would further accelerate depletion of the budget. A similar situation exists globally. As noted in Chapter 2, recent modeling suggests that limiting atmospheric GHG concentrations to 450 ppm CO2-eq is very difficult, and even holding concentrations to 550 ppm requires aggressive action. Bosetti et al. (2008) examined the costs of delay in a global context and suggested that short-term inaction is a key determinant for the economic costs of ambitious climate policies. That is, an insufficient short-term effort significantly increases the costs of compliance in the long term. Delays in beginning to reduce the U.S. contribution to global GHG emissions would risk further loss of opportunities to control GHG concentrations over the long term. THE LARGER CONTExT FOR TECHNOLOGY Although there are many possible opportunities for limiting GHG emissions, most strategies that the nation could adopt to make large, near-term contributions to reducing emissions center on the deployment of reasonably well-known technologies for energy efficiency and low-carbon energy production. These sorts of technological solutions are the primary focus of both the AEF and EMF22 analyses discussed earlier, and they underlie the case for urgent U.S. action. Chapter 4 focuses on crafting a policy portfolio to accelerate the deployment of these near-term, high-leverage technologi- cal opportunities. Ultimately, however, limiting the magnitude of climate change requires looking 

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L I M I T I N G T H E M A G N I T U D E O F F U T U R E C L I M AT E C H A N G E beyond just these near-term technological opportunities. One reason for having a broader focus is that we know additional technology choices will ultimately be re- quired. As explained earlier, even if the existing “high-impact” technologies were to meet their full technical potential, they themselves are not likely to be adequate to meet the stringent demands of the emissions budgets discussed in Chapter 2. Our cur- rent energy system is largely based on R&D that was done two or more decades ago. Basic research could lead to advanced energy efficiency and supply technologies with greatly improved performance, environmental, and economic characteristics. Another, perhaps more important, reason to consider a broader suite of strategies is that many barriers inhibit the deployment of even well-known technologies. For example, the adoption of many energy-efficiency technologies and practices requires significant changes in human behavior, lifestyle, and consumer spending practices. New technologies such as CCS are unfamiliar both to the public and to environmental regulators; if experience is any guide, building the required levels of acceptance for such technologies can be an elusive task. Also, inertias in supply chains and interde- pendent infrastructure systems contribute to slow rates of social and technical change. For these reasons, there is a pressing need for greater understanding of individual and institutional responses to the deployment of new technology. Thus, technological change (discussed in more detail in Chapter 5) must be set in a larger context of research on how social and behavioral dynamics interact with tech- nology, and how technological changes can interact with broader sustainable devel- opment issues. We refer the reader to the report ACC: Advancing the Science of Climate Change (NRC, 2010a) for a deeper discussion of these issues and of the profound changes they imply for the scientific enterprise. KEY CONCLUSIONS AND RECOMMENDATIONS CO2 emissions from fossil fuel combustion in the energy system comprise over 80 percent of total U.S. GHG emissions. CO2 emissions related to energy are driven by eco- nomics and demographics and the resulting demand for goods and services, the en- ergy required to produce these goods and services, the efficiency with which energy is produced and used, and the CO2 emitted by the energy production process. Numerous opportunities to reduce CO2 emissions exist, but many of them require time and investment to be developed to the point of deployment, have cost and other im- plementation constraints, or would have marginal impacts on overall GHG emissions. We conclude that the most substantial opportunities for near-term GHG reductions, 

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Opportunities for Limiting Future Climate Change using technology that is deployable now or is likely to be deployable soon, include the following: • Improved efficiency in the use of electricity and fuels, especially in the build- ings sector, but also in industry and transport vehicles. • Substitution of low-GHG-emitting electricity production processes, which may include renewable energy sources, fuel switching to natural gas, nuclear power, and electric power plants equipped to capture and sequester CO2. • Displacement of petroleum fuels for transportation with fuels with low or zero (net) GHG emissions. Meeting the goal of limiting domestic GHG emissions to 170 Gt CO2-eq by 2050, by relying only on these near-term opportunities, may be technically possible but will be very difficult. Meeting the 200 Gt CO2-eq goal is more feasible but nevertheless very demanding. In either case, realizing the full potential of known and developing technologies will require reducing many existing barriers to deployment; therefore, it is likely these technologies will fall short of their technical potential. This underscores the crucial need to strongly support R&D aimed at bringing new technological options into the mix (discussed further in Chapters 4 and 5). Meeting the 2050 budget goal requires that these new technologies be available by the 2020- 2030 time period. To create the necessary innovations in time for deployment means moving research along very rapidly. Some important opportunities exist to control non-CO2 GHGs including CH4, N2O, long-lived fluorinated GHGs, and short-lived pollutants such as ozone precursors and black carbon aerosols. Opportunities also exist to enhance biological uptake and sequestration of CO2 through afforestation and soil management practices. These op- portunities are worth pursuing, especially as part of a near-term strategy, but they are not large enough to allow the United States to avoid falling short in reducing emis- sions from fossil fuel energy sources. Our nation’s existing energy system, if left unchanged, will rapidly consume the emis- sions budgets suggested in Chapter 2 (especially the more stringent 170 Gt CO2-eq budget). Delay in reforming the energy system would thus make a challenging goal essentially unattainable. Because of this compelling case for urgency, we conclude that action is needed: to accelerate the deployment of technologies that offer significant near-term GHG emis- sions-reduction opportunities; to accelerate the retirement or retrofit of existing high- emitting infrastructure; and to aggressively promote research into the development and deployment of new, low GHG-emitting technologies. 

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