In a historic moment, on June 25 U.S. President Barack Obama released his plan [.pdf] to put the U.S. on the path to reach its target (which is the same as Canada’s) of reducing greenhouse gas (GHG) emissions to 17% below 2005 levels by 2020. While the plan contains a wide range of actions, whether it can deliver results in a timeframe that allows us to rein in the progress of climate change is questionable. Still, the moment is remarkable and the plan is impressive in its scope and ambition. A key impact of the U.S. plan may be the effect it has on spurring other jurisdictions – such as Ontario – to get their respective houses in order.
Obama tried early in his presidency to take action on climate change, but was stymied by Congress. He tried a market-based approach, a cap-and-trade system to control GHGs, which passed the House but not the Senate. Now, four years later, he is acting with the only tool left: his executive power, through the Environmental Protection Agency (EPA). The cornerstone of his new plan is to use his authority to ask the EPA [.pdf] to set emissions standards for both new and existing power plants, America’s largest source of concentrated emissions, which account for 33% of total emissions. This is one area where Ontario is ahead of the game, given the phase out of coal from our electricity sector.
Following Obama’s announcement, however, it will take several years for the EPA to develop the power plant emission standards for existing plants, and experts think they won’t result in emission reductions until 2018. Still, by regulatory standards, this counts as an aggressive timeline. Obama is directing the EPA to work closely with states and other stakeholders to build on existing efforts, and incorporate flexible policy instruments to curb emissions. Deeper reductions are more likely to be achieved with flexible policy instruments [.pdf], but they are also more vulnerable to legal challenges. There is still uncertainty as to exactly how the new rules will look.
Addressing power plant emissions is a necessary, but insufficient, step for the U.S. to reach its 17% target. Renewable energy development will be required and is also top of the agenda. Power generation from renewables has doubled since Obama took office in 2008, and the plan is to double it again by 2020, notably by accelerating wind and solar development (an additional 10 Gigawatts [GW]) on public lands. Ten GW represents over one-quarter of Ontario’s total installed capacity.
An alternative approach to reducing GHGs would involve putting a price on carbon. I’ve said it before – a price on carbon is generally the preferred policy option in terms of economic efficiency, though the devil is in the details [.pdf]. A price on carbon would target more than just power plants and is a more transparent price for companies than a regulatory cost.
Complementary policies are also required and were included in the plan. These range from energy efficiency standards for appliances and federal buildings to double energy productivity by 2030 (from 2010 levels), to forest conservation and restoration, to post-2018 heavy-duty vehicle fuel standards, and more.
Recently, the U.S. signed an agreement with China to phase out hydrofluorocarbons (HFCs) by 2050, a potent greenhouse gas used in many refrigeration products including air conditioners. The U.S. also plans to develop a comprehensive, interagency methane emissions reduction plan, including addressing concerns about methane leakage from shale gas production and landfills, the latter of which I am becoming increasingly concerned about in Ontario.
Another section of the plan addresses climate change adaptation, and the need to increase U.S. resilience. Federal agencies will increasingly take climate risk into account in their investment decisions and programs, including federal infrastructure grants. This type of forward-looking, integrated adaptation action is clearly needed in Ontario as well. I have noted that Ontario has made a good start in the area of climate adaptation, as I reported in 2012.
However, despite all these positive proposals, President Obama noted that U.S. natural gas production and consumption will continue to rise. In fact, the U.S. plans to promote fuel switching (from coal to gas) around the world and to encourage the development of the global gas market. Of course, this is in the economic interest of America, as a growing natural gas producer and potential future exporter. As I argued in my most recent greenhouse gas report, natural gas is no climate change panacea.
One of the other tenets of the Obama plan is to increase international co-operation on climate change, largely directed at large emitters in the developing world; but surely the growing emissions of America’s northern neighbour and largest trading partner must also be top of mind. I welcome the U.S.’s wide-ranging climate change plan, and I hope that it will light a fire under Canadian policy makers to, at the very least, attempt to match the U.S. in terms of scope and urgency of action. Canada matched the U.S. emissions target, will we be able to match its ambition to reach it?
Even before the new policies were announced yesterday, the U.S. was already doing a lot under the radar to reduce emissions and meet its Copenhagen pledge. Contrast that to Ontario (and Canada), where GHG emissions are currently projected to go up, not down.
The bottom line is that the Obama administration is worried about climate change [.pdf]. As the plan says, “climate change is no longer a distant threat.” It is already happening, and now they’re doing something about it. As I said earlier this month, Ontario needs to give renewed attention to the fight against climate change and perhaps this renewed focus within the U.S. will provide some inspiration.