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Two Steps Forward

It's the clean economy, stupid

The new Rhodium Group report highlights rising emissions — indicative of a growing economy, but lack of drawdown solutions.

Greenhouse gas emissions surged in the United States last year, according to a report last week, a disturbing data point during a disconcerting moment in time.

We’ve long known that climate policy in the world’s largest economy has been headed in the wrong direction. Now we see that, after years of declines, emissions are similarly going astray, rising when they need to be plummeting. Last year’s increase was the second-largest in the past 20 years, surpassed only by 2010, when the economy bounced back from the Great Recession.

The emissions growth is the product of a healthy economy. That means more factory operations, commuting workers, plane flights, building construction, consumer purchases and all of the other manifestations of robust finances and thriving employment. All of which means more fuel use and emissions.

In the energy sector, U.S. power consumption increased "meaningfully" in 2018, even amid a steady decrease of coal-generation capacity, said Rhodium Group, an independent economic research firm, which produced the report. Natural gas not only replaced most of the lost coal generation but also fed the vast majority of the load growth last year. Between January and October, U.S. power companies added more gas capacity than was lost in retired coal plants.

The result: Power sector emissions rose by 34 million metric tons in 2018, compared to a decline of 78 million metric tons in 2017, said Rhodium.

The situation was similar in transportation, where modest efficiency gains in gas-fueled vehicles was more than offset by the growth in demand for trucking and air travel, which in turn increased the burning of diesel and jet fuel. On balance, transportation emissions grew by 1 percent in 2018, roughly the same as in 2017.

There’s also what Rhodium called "the forgotten sectors" typically ignored when it comes to climate policy: buildings and industry. Rhodium estimated that direct emissions from residential and commercial buildings increased by 10 percent in 2018, to their highest level since 2004.

Finally, manufacturing: The industrial sector posted emissions gains in 2018, up 2.5 percent for the year, compared with 1.4 percent in 2017, due mostly to vigorous industrial activity.

Said Rhodium: "Absent a significant change in policy or a major technological breakthrough, we expect the industrial sector to become an increasingly large share of U.S. greenhouse gas emissions in the years ahead."

We’ve all been trumpeting those solutions for years: clean power; clean transportation; the circular economy; and, increasingly, carbon removal.
All of which is to say, bad things can come from a good economy. Or, at least, unintended consequences. That’s not surprising: We’ve always valued "goods" much more than "bads."

If there’s a silver lining in last week's report, it's that the problems are spread throughout the economy. Why is that good news? Because it means the solutions are similarly all around us.

We’ve all been trumpeting those solutions for years: clean power (and not just natural gas, which can be as polluting as coal); clean transportation (electrified, connected, shared); the circular economy (reducing manufacturing emissions as well as the extraction and transport of raw materials). And, increasingly, carbon removal — capturing greenhouse gases and either sequestering them or turning them into new materials to manufacture and build things.

Put another way, the Rhodium report is vindication for the clean economy.

Small solace, perhaps. There’s little value in "I told you so" in a world facing potentially cataclysmic scenarios. And it’s not exactly news that we already have many, if not most, of the solutions we need, even if not all are yet cost-competitive.

But it’s reassuring, and more than a little empowering, to know that we, collectively, sit on the right side of this — that the products, processes and policies we’ve been promoting are the ones we actually need.

Enough gloating. There’s work to be done. And Rhodium laid out the challenge: The slowdown in progress, it said, combined with a lack of new climate policy at the federal level, risks putting the U.S. emissions reduction goal under the Paris Agreement  26 to 28 percent below 2005 levels by 2025 — out of reach.

It concluded: "The gap the U.S. needs to close to meet that target got bigger, not smaller."

So, too, must our ambition.

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