Obama wants a “clean energy standard.” What does that mean?

at 10:02 AM ET, 01/25/2012

In his State of the Union address, President Obama noted that a climate bill can’t pass Congress: “The differences in this chamber may be too deep right now.” But he did ask lawmakers for “a clean energy standard that creates a market for innovation.” Is that a close substitute? And could it pass?

(Alex Gallardo - Reuters)
Various proposals for a clean energy standard (PDF) have been knocking around the Senate for years. Early versions required electric utilities to get a certain portion of their power solely from renewable sources like wind or solar (something that 24 states currently do). More recent versions have expanded the list of options to things like nuclear power or natural gas. But a large standard could do a lot to reshape the nation’s electricity supply. For instance, the Energy Information Administration recently modeled a proposal by Sen. Jeff Bingaman (D-NM) that would require utilities to get 80 percent of their power from low-carbon or zero-carbon sources by 2035. The EIA found that greenhouse-gas emissions from the power sector would drop 43 percent by 2035 with a very small effect on economic growth (the hit to GDP would be about 0.02 points per year).

Now, Bingaman’s proposal wasn’t just focused on renewable sources like wind or solar. It would’ve also allowed utilities to build new nuclear plants or replace coal with natural gas. (Since natural gas emits about half of the carbon dioxide that coal does, utilities would get half as much credit for using it as they would for deploying, say, carbon-free geothermal power.) Coal power plants could even get partial credit for burning biomass along with their coal, which is a fairly straightforward and cheap way to reduce carbon emissions.

As the EIA chart below projects, the standard would lead to a sharp reduction in coal use across the United States by 2035, compared with a business as usual case. It would also lead to a big uptick in natural gas, hydropower and renewable energy, and a small reduction in nuclear power. (Since the standard only gives power companies credit for new nuclear plants, rather than current ones, utilities would be expected to retire some of their aging plants rather than work to extend their lifespans.)

Whether this actually works, however, depends on the gritty details. Back in 2010, for instance, the Union of Concerned Scientists warned that a weak and loophole-ridden renewable standard then under Senate consideration (which would’ve asked for 15 percent of all power to come from renewables by 2021) could potentially have done less than the patchwork of state clean-energy mandates that were already in place would have done.

Still, designed right, a standard could have a big impact, and bring the United States closer to its stated goals on climate change. But does it have any chance? According to The Hill’s Ben Geman, Bingaman is planning to unveil a new clean energy standard in the weeks ahead. In the past, a few Republicans like Alaska Sen. Lisa Murkowski have expressed interest (especially if the standard allows for things like nuclear power and carbon capture from coal plants), though odds are this wouldn’t fare well in the House — it is a big, fat mandate, after all.

Ironically, back in 2009, the clean energy standard was considered a watery half-measure when compared against a full climate bill that capped emissions. In retrospect, many greens might have preferred that Congress had passed this sort of policy — which would at least put a hefty dent in emissions and help bolster the clean energy industry — rather than nothing at all.

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