Google's philanthropic arm, Google.org, has released a study that delves into the impact of clean-energy innovation on both the nation’s financial health and its job sector.
Entitled, “The Impact of Clean Energy Innovation”, the study – which used McKinsey’s Low Carbon Economics Tool, or LCET, to model scenarios, highlights the need for energy innovation, even when that innovation appears to compete with economic concerns.
This is because, while renewable energy technologies are currently more expensive than mainstream, baseload energy generation modes that rely on coal, oil and gas, only “clean” energy can deliver us from the dual threat of climate change and energy insecurity caused by dependence on foreign oil.
What Google has done is compare these clean energy technologies to “Business as Usual (BAU)” scenarios (conventional fuels) in two potential futures -- 2030 and 2050.
Assuming fairly significant breakthroughs in the cost of clean energy technologies, including grid storage, and projecting from there, the model follows two potential clean energy paths: a “Clean Policy” of federal renewable energy incentives; and a tax on carbon emissions of $30 per metric ton.
Under the first model, aggressive energy innovation vs. BAU, the U.S. could:
- Grow its economy by more than $155 billion in gross domestic product (GDP) per year.
- Create more than 1.1 million new net jobs (and up to 1.9 million under a Clean Policy, or CP, scenario).
- Save consumers more than $942 per household each year, or as much as $995 under a CP.
- Reduce the nation’s oil consumption by more than 1.1 billion barrels a year (this is about as much as India uses in the same time period).
- Lower the nation’s greenhouse gas emissions, or GHGs, by 13 percent (or up to 21 percent under the CP scenario).
By 2050, that GHG reduction grows to 55 percent (63 percent under the CP regimen), which closely approaches the 80 percent by 2050 goal outlined by President Barack Obama, Energy Secretary Steven Chu and the U.S. Department of Energy.
Outlining concentrating solar power, or CSP, and offshore wind as the two technologies most likely to achieve breakthroughs (with solar photovoltaic, or PV, a close third), the study suggests that even carbon capture and storage (CSS) coal generation will be more expensive than everything but offshore wind by 2050 – and even then offshore wind is within one percentage point!
Grid storage elements like batteries were outlined, but primarily for use in electric vehicles (EVs). Even natural gas was modeled under the BAU scenario, and the results were clear; only GDP is likely to remain the same under either a BAU or aggressive innovation model. Household energy bills are likely to fall, as is oil demand and emissions.
The best scenarios are those nearest in time. If the BAU attitude prevails, GDP is likely to go down by $3.2 trillion, with jobs taking a similar fall (up to 1.4 million) and GHGs rising by an additional 28 billion metric tons.
This was even true in the battle between EVs and Compressed Natural Gas, or CNG, with timely EV breakthroughs becoming cost competitive with CNG, but their failure leading to a prolonged and difficult-to-reverse dominance for CNG.
In short, the study demonstrates that favorable clean energy policies are wholly synergistic with technological breakthroughs and can create huge new vertical markets, take the shine off traditional electricity generation fuels like coal by removing incentives or price props, and provide for increased uptake of renewables by making them attractive, familiar and – most of all – affordable.
In fact, if the most effective policy is implemented, Google.org speculates, we can even reach that Holy Grail of 80 percent (GHG reduction) by 2050.
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