Climate change is among the most profound challenges of all time, confronting individuals, businesses, and governments across the globe. Meeting this challenge requires a sweeping, sustained effort over the coming decades. To successfully orient the global economy toward the goal of climate protection will require strong leadership from two indispensable forces: the United States, the world’s leading economy, and the private sector—foremost for its power to innovate.
The Center for Climate and Energy Solutions (C2ES) is working to help illuminate and confront this looming long-term challenge through Climate Innovation 2050. This multi-year initiative brings together leading companies across key sectors to develop viable pathways for decarbonizing the U.S. economy. As an initial step, C2ES led a group of companies in a collaborative exercise examining potential scenarios for achieving mid-century decarbonization goals. This scenario exercise aimed to build a common understanding—benefitting both these firms and broader societal efforts—of the potential for alternative pathways to deep decarbonization in the United States and to highlight important commonalities and differences among such paths. This report presents the resulting scenarios and the insights drawn from them.
The scale and the broad contours of the decarbonization challenge are addressed at the global level by the long-term goals of the Paris Agreement, which include achieving global greenhouse gas neutrality in the second half of the 21st century. For the purposes of the scenario development undertaken here, we chose a corresponding benchmark for the United States: an 80 percent reduction from 2005 levels in economy-wide emissions by 2050.
Achieving climate neutrality requires a broad array of social, economic, and technological transformations—in essence, reinventing the ways we power our homes and economies, move people and goods from place to place, and manage our lands. Previous analyses point to five core imperatives: decarbonizing the world’s power supply; switching to electricity and other low-carbon fuels in the transportation, industry, and buildings sectors; increasing energy efficiency in each of those sectors; increasing carbon sequestration; and reducing emissions of non-carbon climate pollutants.
Many decarbonization scenarios to date have focused primarily on the technological dimensions of these challenges. This collaborative scenario exercise closely examined social and policy dimensions as key drivers of change as well, including the roles played by policy-makers, businesses, and consumers.
This current scenario exercise—undertaken in partnership with the RAND Corporation and the Joint Global Change Research Institute, a partnership between the Pacific Northwest National Laboratory and the University of Maryland—can help advance collective understanding in a number of ways. Unlike most previous scenario exercises, it is directly informed by the insights and perspectives of more than 20 leading companies in sectors critical to decarbonizing the U.S. economy, including electric power, transportation, oil and gas, manufacturing, and high-tech. By deepening understanding of the relevant challenges and opportunities, this exercise helps to inform the long-term decision-making of participating companies and, hopefully, the business community at large.
For Climate Innovation 2050, the insights drawn from this exercise provide a critical foundation for the next stage of the initiative—working with companies to outline a comprehensive strategy for putting the United States on the path to climate neutrality.
The report describes the scenario development process, present the three final scenarios and accompanying modeling results, outline broad and sector-by-sector takeaways, and offer brief conclusions. Appendices provide further detail on the scenario development process, the quantitative modeling assumptions and results, the baseline scenario, and the model employed.
- Decarbonizing the U.S. economy requires fundamental shifts in the ways we generate energy, produce goods, deliver services, and manage lands.
- These fundamental shifts can be achieved through a host of alternative pathways reflecting different drivers, different contingencies, and different societal choices.
- Decarbonization requires that action accelerates quickly and that everyone plays their part—policy-makers at all levels, investors, entrepreneurs, consumers, voters, and companies across key sectors of the economy.
- The success of any pathway hinges on high levels of public support, expressed through stronger demand for effective policies and/or low-carbon goods and services.
- Decarbonization requires a broad suite of policies that drive investment and action by setting goals, targeting resources, providing incentives, and ensuring a level playing field.
- Technological innovation can greatly facilitate decarbonization but, without adequate policy drivers, is not sufficient to achieve it.
- The private sector is an essential partner in any decarbonization pathway, and timely business leadership can help ensure choices that are beneficial for both companies and society as a whole.
- Sectoral responses are highly interdependent—the pathway chosen by one sector may enhance or constrain the decarbonization options of others.