(Bloomberg Opinion) -- House Democrats last week released a wide-ranging plan for tackling climate change and related environmental issues, including proposals to set targets for reducing greenhouse-gas emissions, promote alternative-energy technologies, create new building codes and even revive the Depression-era Civilian Conservation Corps. While it probably won’t go anywhere in today’s divided Congress, and it isn’t as far-reaching as the more progressive Green New Deal, the plan is significant as it may become the new baseline for a discussion on energy, the environment and potential future policies. This may especially be so should Democrats win back control of the White House and capture both houses of Congress this fall.
The plan sets forth standards for energy’s transition in the next decade and beyond, and in doing so, takes a crucial step forward in the discussion by acknowledging that there are realistic limits on the advancement of the technology needed to fully transform our platforms. The report states, for instance, that moving toward a regime of zero-carbon emissions “may require new technologies that have yet to be invented.” This is a groundbreaking admission.
Too often, the conversation about climate and energy is tainted by intransigence or unrealistic dreams from both sides. In truth, we do not yet know if or when innovations will change the energy landscape. So acknowledging this uncertainty is key to developing a realistic energy transition policy that has a chance at implementation. The problem is, the policy recommendations – particularly those centered on new standards for future years – don’t take this important reality check into account.
It’s true that the goals it sets could be seen as aspirational and motivational. They include net-zero carbon emissions in 2050, net-zero emissions in the electricity sector by 2040 and zero emissions for all light duty vehicles sold by 2035. Yet, acts of Congress are rigid; inspiration and creation cannot be mandated by legislation. Therefore, we cannot afford to ignore our legacy sources of energy. Unless we have new technology available, we must continue to use a mix of oil, gas, nuclear and renewables to power our economy and lifestyles.
There are other potential trouble spots. For instance, the congressional group recommends increased funding for research and government support for companies working on innovative technologies. The public should be skeptical of such policies because we know from previous experience that trying to pick the green-tech winners may end up wasting money. For example, the government made poor decisions when it backed companies such as solar operator Solyndra, battery maker A123 Systems LLC and carmaker Fisker Automotive . Those ventures squandered taxpayer money and went bankrupt. Good businesses with strong leadership and promising plans should be able to secure private-sector funding on their own. The energy sector is valuable enough, and true innovation would be worth the private investment.
The plan also calls for the requirement of carbon offsets for new buildings and increasing taxes on carbon fuels. These proposals might be more reasonable if there were realistic and affordable alternatives to current technology, but they don’t exist. The plan admits this. According to Bloomberg News, Americans are already facing a 25% increase in electricity bills this summer, and we can expect higher gasoline prices as the price of crude oil rises. It would be unreasonable for Congress to pass along the cost of ambitious standards to the American people, who far too often are just trying to get by. Higher utility bills and prices at the pump are regressive burdens that hurt poor Americans the most.
In putting forth their plan, Congressional Democrats are helping shape and lead the debate over important climate and policy issues that must be addressed in the years ahead. But it’s crucial that any new regimes reflect existing realities, learn from past mistakes and not bank too much on innovation that can’t be guaranteed. In the meantime, as American and global innovators work on these problems, our legacy energy sources will have to continue powering our economy and way of life.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Ellen R. Wald is president of Transversal Consulting and a nonresident senior fellow at the Atlantic Council's Global Energy Center.
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