For years, the United States has resisted mandatory reductions in greenhouse gas emissions because of the perceived cost to the national economy. But a new report suggests that significantly reducing U.S. carbon emissions could cost far less than the trillions of dollars some have projected. McKinsey & Co., a privately owned management consulting firm, predicts that making substantial emissions cuts may cost the economy only a few billion dollars, and that at least 40 percent of the reductions would actually bring economic savings.
This week, delegates at the United Nations climate change conference in Bali are struggling to build a post-Kyoto Protocol framework to reduce worldwide greenhouse gas emissions. But they face resistance from some of the world’s biggest emitters, China, India, and the United States. These countries are worried that their economies will suffer from imposed emissions caps.
Some models do predict heavy costs associated with reducing emissions. Last month, the U.S. Chamber of Commerce estimated that a new bill to restrict emissions currently being debated in the U.S. Congress would cost 3.4 million Americans their jobs. And William Nordhaus of Yale University calculates that slowing global warming would cost $20 trillion, according to Business Week.
But the McKinsey report argues that with a long-term model, costs are actually much lower. Supported by both energy companes and environmental groups, including Environmental Defense, Natural Resources Defense Council, Royal Dutch Shell, and Pacific Gas and Electric, the study finds that the United States could reduce its projected greenhouse gas emissions in 2030 by three to four-and-a-half gigatons using technology that is largely already in place. “Eighty percent of the reductions come from technology that exists today at the commercial scale,” according to McKinsey director Jack Stephenson. The other 20 percent is from technology that is currently being developed, such as plug-in hybrids and cellulosic biofuels.
The report predicts that mitigation efforts will cost less than $50 per ton of greenhouse gas emissions, or an amount in the tens of billions of dollars overall. One reason for the lower cost, explains Stevenson, is because the United States currently wastes large amounts of energy, and simple changes could make the country vastly more efficient. The McKinsey report acknowledges that there will be some short-term losses, and that different sectors of the economy will not be affected equally. But overall, the report is considered a more encouraging analysis than many. “It’s the difference between a business consultant who sees opportunities for business, and a hired-gun economist,” says Dan Lashof of the Natural Resources Defense Council.
By Alana Herro. This story was produced by Eye on Earth, a joint project of the Worldwatch Institute and the blue moon fund.
Its very true the reduction of CO2 will help us save the economy....
One of the cheapest means of offsetting carbon listed in the McKinsey report is nuclear power. New is on the carbon abatement curve at slightly cheaper than onshore wind at less than $10/ton.
They argue for streamlining approval and permitting procedures for nuclear, tranmission lines and pipelines.
The report does not consider even faster shifts to nuclear power that are possible.
Widespread thermoelectronics and improved diesel engines and superconductors for power grids and motors could radically transform efficiency.
The main impacts are that successful development of thermoelectronics via the DOE/ EERE / Freedomcar program and the Westinghouse development of the MIT or other work to allow for major uprating of nuclear reactors and new reactors fast build reactors like form Hyperion power systems can radically alter the energy picture by 2012-2020.
Thermoelectric retrofit and 50% uprating can increase nuclear power by 225%.
Brian and friends,
Thanks for the suggestions re thermoelectronics. At first glance it looks very interesting. I will check into it further.
Investing more money in nuclear however just seems stupid to me. There are so many truly renewable technologies that are now being developed that this is where we should be putting our money, that and into energy efficiency and conservation. If we had invested all of the money that we have put into nuclear into renewables and energy efficiency in the first place, we would probably already being powering society totally with renewables.
I am also wondering if anyone has ever done an analysis of what it is likely to cost society over the long term to safeguard civilization from the waste stream from nuclear energy. I would imagine that it will cost far more in both energy and money than we will ever get from the energy production itself.
It would make so much more sense to move to a fully sustainable energy system as quickly as possible and that is where we should be putting our money now.
>If money invested in nuclear had gone to renewables
Since we do not have a time machine then this is an irrelevant point.
The current situation is the one that needs to be optimized.
>On the cost of the nuclear waste stream
The amount of nuclear "waste" is reduced 1000 times.
The technology for burning all current and future nuclear waste (actually unburned fuel) can be developed. So the strawman of how much it costs to store unburned fuel for thousands of years is completely incorrect.
Developing the proper reactors (investing in nuclear) is the cost effective solution to the existing unburned fuel (nuclear waste problem). Not developing the proper reactors and not making the investment would be very stupid. It would be the same as trying prevent everyone from getting cuts and infected when we can develop vaccines innoculate the people at lower cost.
Also, the very report and research that the worldchanging team is applauding for saying that CO2 fixes can be cheap is saying that nuclear power is cheaper than solar and wind and sequestered coal.
The McKinsey report quotes far higher prices for solar and wind and other renewables and does not incidicate that solar and wind and other renewables can by themselves replace coal or oil or nuclear in any timeframe.
The cost to safeguard humanity from nuclear waste is the cost of developing the Fuji molten salt reactor and building several of them or the other liquid flouride reactor designs. A few billion dollars or less than 0.1% of the noted $20 trillion cost of global warming.
If the hype about Nanosolar's products is true (presumably they've begun shipping) then the objections about solar's cost become moot.
However absent a worldwide superconducting power grid solar isn't going to be a panacea to our energy problems due to the simple fact that it doesn't work at night.
Fourth generation nuclear plants makes sense, if only as a means of disposing of our current stockpile of nuclear waste. I think if people understood how these new technologies could enable us to eliminate our current stockpile of waste (much of it sitting in temporary storage facilities that were never designed to be used this long) objections about deploying these technologies would evaporate.
Unfortunately even mentioning the word nuclear stirs up a lot of negative connotations and most people shut off immediately.
I suspect this issue needs to be framed as a method of dealing with the problem of Nuclear waste rather than as a means of power generation in order to be effectively communicated to the uninitiated.
I'd encourage the folks at Worldchaning to take a look at this.