The world is waiting to see the America’s next steps following our withdrawal from the Paris Agreement. While the President expressed a willingness to negotiate re-entry into the agreement, his underlying intent was clear: America will pursue its own economic and energy development path independent of international goals. With the White House poised to outline pro-growth policies during Energy Week, it’s clear that through the promotion of clean energy technologies and an all-of-the-above energy policy, the U.S. will continue to reduce emissions, increase economic growth, and ultimately achieve energy independence.
Prior to America’s withdrawal from the Paris Climate Agreement, CRES Forum was a vocal proponent of a “stay in and renegotiate” approach. We rejected the false assertion that a path forward consisted of a binary choice between adherence to the current terms outlined by President Obama and scrapping American involvement altogether. We saw eye to eye with dozens of innovative private sector leaders, members of President Trump’s Cabinet and Republicans on Capitol Hill who recognized the benefits the Agreement could have on mitigating our carbon footprint and supporting our economy.
Policy-makers at the state and local level have wide latitude to pursue energy and job creation opportunities centered on carbon capture and sequestration, advanced nuclear, increased natural gas, energy efficiency, and clean energy development. In a federal system like ours, states are naturally positioned to lead on complex issues. However, coherent national legislation can help all states reap economic, national security, and environmental benefits. Now is the time for the federal government to build upon state policy, not undermine it.
Nine northeastern states are members of the market-based Regional Greenhouse Gas Initiative. California has also established a similar program to reduce greenhouse gas emissions. A parallel set of renewable energy credit (REC) markets have evolved across dozens of states and municipalities to achieve emissions reduction goals. While effective to-date, these local and regional markets are small-scale (compared to a national market) and utilize different trading units. The federal government can play a role in helping these markets work together. Building a voluntary nation-wide framework with common trading units would eliminate inefficiencies in state, local, and regional energy credit and emissions markets through standardization.
Many companies, including Google and Apple, already voluntarily offset emissions or participate in carbon markets, and more and more shareholders demand that climate risk be factored into corporate decision-making. By creating market standards, barriers for small businesses to engage these markets will be reduced and the door to existing global markets will be easier to open. This option protects the rights of states and does not establish mandates for corporations, instead allowing project developers to achieve economies of scale and help communities meet their own climate change goals.
Breaking up state-level energy monopolies will also provide customers with more energy choices. Some monopolies already recognize that customers want to buy renewable energy, so they sell packages of wind, solar, hydro and nuclear energy at a premium. However, customers are prohibited from buying electricity from another vendor—even if it would be cheaper. Increasing the competitiveness of electricity markets would allow families and businesses to buy from the power provider of their choice, based on price and environmental considerations. By increasing competition, prices would drop for consumers and opportunities would rise for clean energy entrepreneurs. Clean energy markets are ripe for more innovation and cost reduction.
As we ponder next steps, the U.S. should remain engaged with the United Nations Framework Convention on Climate Change (UNFCCC) and negotiate re-entry into the Paris Agreement on more favorable terms. The UNFCCC has near universal membership and is the parent treaty of the Kyoto Protocol and the Paris Agreement. America already has a seat at the table for future negotiations. By re-envisioning U.N. led financial institutions, prioritizing multilateral banks over U.N. financial institutions, allowing countries to count bi-lateral spending that has integrated climate change, and adding a provision for third party verification of greenhouse gas reporting disputes, the Paris Agreement would be more effective.
Ivanka Trump recently said during technology week at the White House that, “innovation has and will continue to transform the world – and the way the U.S. government works on behalf of all Americans.” Nowhere is the promise of this sentiment more prevalent than within the realm of renewable energy. Carbon dioxide emissions peaked in the United States in 2005. They fell 12 percent a decade later due to changes in energy generation, particularly a market-driven switch to clean energy like natural gas, wind, and solar energy. With the continued adoption of clean energy technologies and the implementation of market-friendly, all-of-the-above energy policies, the U.S. can achieve substantive emissions reductions, increase economic growth, and achieve energy independence.
Charles Hernick is the Director of Policy and Advocacy at Citizens for Responsible Energy Solutions (CRES) Forum, a nonpartisan, nonprofit organization committed to educating the public and influencing the national conversation about clean energy.
