The U.S. Electric Power Sector and Climate Change Mitigation

The electricity sector in the United States enables almost every aspect of our economy—from agriculture, to manufacturing, to e-commerce. As witnessed during the California Energy Crisis and the 2003 blackout in the northeast and midwest, interruptions in the supply of electricity can be highly disruptive. It is hard to imagine a sector that is more important to our economy than electricity. But electricity also accounts for one third of our nation’s greenhouse gas emissions. In order to effectively address the climate challenge, we must significantly reduce greenhouse gas emissions associated with electricity production and use. In this report, authors Granger Morgan, Jay Apt, and Lester Lave identify numerous opportunities to decarbonize the U.S. electricity sector over the next 50 years.

This Pew Center report is part of our effort to examine key sectors, technologies, and policy options to construct the “10-50 Solution” to climate change. The idea is that we need to tackle climate change over the next fifty years, one decade at a time. Looking at options available now and in the future, this report yields the following insights for reducing GHG emissions from the electricity sector.

• There are likely multiple pathways to a low-carbon future for the electricity sector, and most involve some portfolio of technological solutions. The continued use of coal with carbon capture and sequestration; increased efficiency in the generation, transmission and end use of electricity; renewable and nuclear power generation; and other technologies can all contribute to a lower-carbon electric sector. Yet, all of these technologies face challenges: Cost, reliability, safety, siting, insufficient public and private funds for investment, and market and public acceptance are just some of the issues that will need to be resolved.

• A major effort is needed to develop and deploy commercially available low-carbon technologies for the electric sector over time. The lower-carbon efficiency and generation technologies available and competitive in the market today are probably insufficient to decarbonize the electricity sector over the next few decades. Given the magnitude of the challenges the industry faces in coming decades, it is critical that the United States—both the public and private sectors—develops and maintains dramatically expanded R&D. Near-term and long-term R&D investments will help ensure that we have technologies to enable a low-carbon electricity sector.

• It is critical that we start now to embark on the path to a lower-carbon electric sector. A decarbonization of the electricity sector could be achieved in the next 50 years through increased efficiency and fuel-switching in the near term, and a gradual deployment of lower-carbon technologies over the next several decades. Over the long term, GHG reductions will be achieved at lower cost if climate considerations are incorporated into the industry’s investment decisions today. Voluntary efforts to reduce GHG emissions will not be enough, especially given the current uncertainty in the industry. A clear timetable for regulation of GHG emissions is essential—a timetable that begins in the near future.

The authors and the Pew Center would like to thank Severin Borenstein of the University of California Energy Institute, Ralph Cavanagh of the Natural Resources Defense Council, and Tom Wilson of EPRI for their review of and advice on a previous draft of this report.