It’s well past time for a national standard for low-carbon electricity. In order to avoid the worst impacts of climate change we must rapidly decarbonize our power sector while rapidly electrifying as much of the transportation, industry, and buildings sectors as possible. That means adding a lot more carbon-free electricity generation as quickly as possible, and renewables are by far our cheapest option. A national standard for low-carbon electricity is our best opportunity to accelerate clean energy deployment without costs to ratepayers or taxpayers.
With today’s introduction by Senator Tom Udall (D-NM) of the Renewable Electricity Standard Act (RES), the Senate now has two proposals that would create a national standard for low-carbon electricity generation. Senator Tina Smith (D-MN) kicked off the conversation earlier this year with the introduction of the Clean Energy Standard Act (CES), which would decarbonize the power sector by mid-century using a variety of low and zero carbon sources. The Udall proposal is focused on ramping up renewables over the next 15 years (in every state), putting the US on a trajectory to decarbonize the power sector by mid-century.
These two proposals take different approaches toward the same goal of transitioning all electricity generation to carbon free sources in a time horizon consistent with the best available climate science, and they do so while preserving the voluntary markets and without interfering with state policy.
If you aren’t supporting one of these bills, you are standing on the sidelines of clean energy progress.
How do they compare?
- The Smith CES goes till 2050, while the Udall RES goes till 2035 with a requirement to consider revising and extending the policy to decarbonize the power sector by 2050.
- The Smith CES credits both new and existing renewables, nuclear, and fossil energy with carbon, capture and sequestration (CCS), while the Udall RES mostly credits new renewables like wind and solar, with very little existing generation.
- The Smith CES credits energy technologies through a carbon intensity standard that ratchets down over time while the Udall RES credits renewables-only at full credit.
- Both bills focus on “growth rates” rather than an overall national percentage target by a certain year.
- The Smith CES would ask utilities to grow by 2.75% every year until they hit 60% existing carbon-free electricity (1.75% till they hit 90%), while the Udall RES requires that utilities grow at 2% through the next decade and 2.5% through 2035, until they hit at least 60% renewable electricity.
- Both bills tier the growth rates, with smaller utilities required to grow at lower rates than large utilities (with retail sales over 2 million and 1 million MWh per year respectively).
- The Smith CES allows states to opt-out when they reach 90% carbon free generation, while the Udall RES allows states to opt-out if they have 60% renewables, or if the state’s RES or CES requires growth at or above the federal floor-setting standard.
- The Smith CES incentivizes innovative, first-of-its-kind-projects as well as firm, dispatchable generation through additional credits (1.5 credits declining over time), while the Udall RES incentivizes renewable energy development on Native American lands, and in environmental justice and coal communities (2 credits).
These policies deliver similar outcomes through 2035
Due to the use of different models and different assumptions about natural gas prices, a comparison of the Smith CES using the E4ST analysis by Resources for the Future and the Udall RES using NREL’s ReEDS analysis won’t yield much clarity on the relative benefits of each policy (apples to oranges). But UCS did model a 95% by 2050 Clean Energy Standard in ReEDS last year with similar assumptions for natural gas prices, which is a good proxy and should give us a rough estimate of how the Smith CES shakes out compared to the Udall RES (apples to apples).
The graph above looks at the projected electricity generation mix using four scenarios out to 2035 and includes a 95% by 2050 Low-Carbon Energy Standard (LCES), better known as a CES. Under this policy the US would achieve 50% renewables by 2035; about the same as the Udall RES. Electricity from coal is projected to be less than a percent by 2035 with either policy. However, electricity from natural gas is projected to be about 24% by 2035 with the Smith CES bill relative to 36% with the Udall RES.
While the two policies deploy roughly the same amount of renewables by 2035 the location of those renewables would likely be different given the different policy designs. The Udall RES likely distributes renewables more evenly around the country, with better penetration in laggard clean energy states.
But the Smith CES reduces slightly more power-sector emissions by 2035 (53% in the LCES analysis relative to 46% for the Udall RES bill), the primary reason being that it requires utilities to grow at 2.75% right off the bat, which is pretty steep, especially for states that are adding renewables at or below the national average of 1% annually. Another reason the Smith CES reduces more emissions is because it helps preserve the carbon-free generation of existing nuclear power plants and delivers about 7% electricity from natural gas with CCS by 2035.
So, pick your policy. Both policies are affordable and have considerable economic, public health and consumer benefits. Renewables certainly have public health and environmental benefits that technologies like nuclear and fossil with CCS do not. That’s an important consideration for equity given that economically vulnerable communities are more likely to be exposed to pollution from electricity generation. But the Smith CES bill assures that our power sector is virtually carbon-free by mid-century, and the policy is designed to optimize least-cost, it preserves important existing low-carbon nuclear generation (that also means preserving jobs).
Do you prefer a near-term policy to give us a boost and put us on the right trajectory, or a long-term policy that locks us into a carbon-free power sector by mid-century? The good news is that both policies get us on a pathway to avoid the worst impacts of climate change.
I say, the best policy is the one that can pass both chambers of congress and get signed into law by the president.