A Better Climate Bill (2010)

Raising Efficiency and Renewable Electricity Standards Increases Consumer Benefits

This new analysis by the Union of Concerned Scientists (UCS) builds on an August 2009 U.S. Energy Information Administration (EIA) study of the American Clean Energy and Security Act (ACES), a comprehensive climate and energy bill passed in June 2009 by the U.S. House of Representatives. In addition to a national cap on carbon emissions, ACES includes a combined energy efficiency and renewable electricity standard (RES) requiring large electric utilities to increase their use of efficiency and renewable energy to a nominal target of 20 percent by 2025. While the EIA study showed that ACES is both achievable and affordable, it also found that the RES embedded in the bill does not contribute to any substantial growth of renewable energy because of loopholes that erode the required electricity generation to levels below the EIA's "Business as Usual" projections. 

We set out to examine the long-term economic and environmental costs and benefits of increasing the renewable electricity and energy efficiency standards in the carbon cap and other provisions included in ACES. To do so, we used the version of the National Energy Modeling System that the EIA employed for its analysis, and the same cost and performance assumptions as its "Basic Case" policy scenario.  Our analysis differs from the EIA's Basic Case in that we evaluated (1) a higher national renewable electricity standard of 25 percent by 2025 that closes the loopholes in ACES  and (2) a separate energy efficiency resource standard (EERS) that requires utilities to achieve a 10 percent electricity savings from efficiency measures by 2020. Our analysis finds that compared with ACES, raising the efficiency and renewable electricity standards would:

  • Reduce consumer electricity and natural gas expenditures by $113 billion through 2030
  • Lower average U.S. household annual energy costs by nearly $100 in 2030
  • Diversify the electric power mix and avoid the need for nearly 50 new nuclear power reactors
  • Hasten the shift to a clean energy economy by increasing emission reductions within the capped sectors.

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