Clean Jobs Bill, Carbon Trading Could Yield Significant Economic Benefits for Illinois
CHICAGO (February 24, 2016)—New analysis released today by the Union of Concerned Scientists (UCS) shows that strengthening Illinois’ clean energy policies by adopting the Clean Jobs Bill, together with a national carbon emissions-trading program, provides a cost-effective way for the state to cut global warming emissions, deliver significant health and economic benefits to residents, and comply with the Environmental Protection Agency’s Clean Power Plan.
Earlier this month, the U.S. Supreme Court issued a stay regarding implementation of the Clean Power Plan until the rule’s content is evaluated. Governor Rauner should follow the lead of governors from at least 16 other states who have announced they will move forward with crafting their state’s compliance plans. This will ensure Illinois maintains its strong momentum transitioning to low-carbon energy while waiting for the Clean Power Plan to be legally resolved.
“The Supreme Court’s procedural decision doesn’t change the reality of climate change or the urgent need to curb our use of carbon-producing fossil fuels,” said Steve Clemmer, director of energy research for the Climate and Energy Program at UCS. “Our analysis confirms investing more in renewables and energy efficiency to cut carbon emissions makes strong economic sense.”
The UCS analysis found that participation in a national carbon emissions trading program, along with strengthening the state’s energy efficiency and renewable energy standards as key strategies to comply with the Clean Power Plan would:
- Save consumers more than $2.6 billion cumulatively through 2030 from reduced fuel and other avoided costs due to the state’s renewable energy and energy efficiency policies;
- Reduce the typical Illinois household’s electricity bill 9.4 percent in 2030 for an annual savings of $100;
- Lead to more than $4.5 billion in energy efficiency improvements to benefit consumers and reduce electricity demand by 25 percent;
- Generate an average of $603 million annually by 2030 from the sale of carbon allowances;
- Yield nearly 6,000 megawatts of new wind and solar capacity in Illinois by 2030, which could stimulate $6.3 billion in new capital investments; and
- Provide health and economic benefits worth an estimated $14.3 billion cumulatively through avoided carbon dioxide, sulfur dioxide, and nitrogen oxide pollution.
Illinois’ renewable portfolio standard (RPS) has been one of the primary drivers of wind and solar development in the state. However, Illinois is not meeting its current RPS targets, which requires investor-owned utilities and other electricity suppliers to derive 25 percent of their power from renewables by 2025, because the RPS fails to address a key barrier to development: the inability of utilities to engage in long-term planning for energy-resource investments.
The state’s current electricity market structure creates uncertainty about the size of each supplier’s future electricity sales, thereby limiting utilities’ ability to make long-term commitments to renewable energy. Consequently, renewable energy development in Illinois has largely stagnated in recent years. In some cases, Illinois is even falling behind. Data recently released by The Solar Foundation found that Illinois fell from 12th to 14th in solar jobs as it lost nearly 300 solar jobs in 2015 due to its out-of-date energy policy.
“Fixing and strengthening the state’s renewable energy and energy efficiency standards is a smart strategy to regain Illinois’ national leadership in developing clean energy, while providing a cost-effective way to comply with the Clean Power Plan,” said Clemmer. “Illinois has the opportunity to enact policies that drive billions in capital investments, reduce consumer costs, and improve public health. That’s something everyone should be able to support.”
Based on the analysis, UCS recommends that Illinois move forward with developing a strong carbon reduction plan that includes strengthening the state’s energy efficiency and renewable energy standards—as outlined in the Clean Jobs Bill—and establishing a carbon trading program with the auctioning of carbon allowances.