[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]
BUILDING A 100 PERCENT CLEAN ECONOMY: SOLUTIONS FOR ECONOMY-WIDE DEEP
DECARBONIZATION
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON ENVIRONMENT AND CLIMATE CHANGE
OF THE
COMMITTEE ON ENERGY AND COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTEENTH CONGRESS
FIRST SESSION
__________
DECEMBER 5, 2019
__________
Serial No. 116-82
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the Committee on Energy and Commerce
govinfo.gov/committee/house-energy
energycommerce.house.gov
______
U.S. GOVERNMENT PUBLISHING OFFICE
44-432 PDF WASHINGTON : 2021
COMMITTEE ON ENERGY AND COMMERCE
FRANK PALLONE, Jr., New Jersey
Chairman
BOBBY L. RUSH, Illinois GREG WALDEN, Oregon
ANNA G. ESHOO, California Ranking Member
ELIOT L. ENGEL, New York FRED UPTON, Michigan
DIANA DeGETTE, Colorado JOHN SHIMKUS, Illinois
MIKE DOYLE, Pennsylvania MICHAEL C. BURGESS, Texas
JAN SCHAKOWSKY, Illinois STEVE SCALISE, Louisiana
G. K. BUTTERFIELD, North Carolina ROBERT E. LATTA, Ohio
DORIS O. MATSUI, California CATHY McMORRIS RODGERS, Washington
KATHY CASTOR, Florida BRETT GUTHRIE, Kentucky
JOHN P. SARBANES, Maryland PETE OLSON, Texas
JERRY McNERNEY, California DAVID B. McKINLEY, West Virginia
PETER WELCH, Vermont ADAM KINZINGER, Illinois
BEN RAY LUJAN, New Mexico H. MORGAN GRIFFITH, Virginia
PAUL TONKO, New York GUS M. BILIRAKIS, Florida
YVETTE D. CLARKE, New York, Vice BILL JOHNSON, Ohio
Chair BILLY LONG, Missouri
DAVID LOEBSACK, Iowa LARRY BUCSHON, Indiana
KURT SCHRADER, Oregon BILL FLORES, Texas
JOSEPH P. KENNEDY III, SUSAN W. BROOKS, Indiana
Massachusetts MARKWAYNE MULLIN, Oklahoma
TONY CARDENAS, California RICHARD HUDSON, North Carolina
RAUL RUIZ, California TIM WALBERG, Michigan
SCOTT H. PETERS, California EARL L. ``BUDDY'' CARTER, Georgia
DEBBIE DINGELL, Michigan JEFF DUNCAN, South Carolina
MARC A. VEASEY, Texas GREG GIANFORTE, Montana
ANN M. KUSTER, New Hampshire
ROBIN L. KELLY, Illinois
NANETTE DIAZ BARRAGAN, California
A. DONALD McEACHIN, Virginia
LISA BLUNT ROCHESTER, Delaware
DARREN SOTO, Florida
TOM O'HALLERAN, Arizona
------
Professional Staff
JEFFREY C. CARROLL, Staff Director
TIFFANY GUARASCIO, Deputy Staff Director
MIKE BLOOMQUIST, Minority Staff Director
Subcommittee on Environment and Climate Change
PAUL TONKO, New York
Chairman
YVETTE D. CLARKE, New York JOHN SHIMKUS, Illinois
SCOTT H. PETERS, California Ranking Member
NANETTE DIAZ BARRAGAN, California CATHY McMORRIS RODGERS, Washington
A. DONALD McEACHIN, Virginia DAVID B. McKINLEY, West Virginia
LISA BLUNT ROCHESTER, Delaware BILL JOHNSON, Ohio
DARREN SOTO, Florida BILLY LONG, Missouri
DIANA DeGETTE, Colorado BILL FLORES, Texas
JAN SCHAKOWSKY, Illinois MARKWAYNE MULLIN, Oklahoma
DORIS O. MATSUI, California EARL L. ``BUDDY'' CARTER, Georgia
JERRY McNERNEY, California JEFF DUNCAN, South Carolina
RAUL RUIZ, California, Vice Chair GREG WALDEN, Oregon (ex officio)
DEBBIE DINGELL, Michigan
FRANK PALLONE, Jr., New Jersey (ex
officio)
C O N T E N T S
----------
Page
Hon. Paul Tonko, a Representative in Congress from the State of
New York, opening statement.................................... 1
Prepared statement........................................... 3
Hon. John Shimkus, a Representative in Congress from the State of
Illinois, opening statement.................................... 4
Prepared statement........................................... 5
Hon. Frank Pallone, Jr., a Representative in Congress from the
State of New Jersey, opening statement......................... 6
Prepared statement........................................... 8
Hon. Greg Walden, a Representative in Congress from the State of
Oregon, opening statement...................................... 9
Prepared statement........................................... 11
Witnesses
Daniel C. Esty, Hillhouse Professor of Environmental Law & Policy
and Director, Yale Center for Environmental Law & Policy, Yale
Law School and Yale School of Forestry & Environmental Studies. 12
Prepared statement........................................... 15
Answers to submitted questions............................... 99
Noah Kaufman, Ph.D., Research Scholar, Center on Global Energy
Policy, Columbia University School of International and Public
Affairs........................................................ 22
Prepared statement........................................... 24
Answers to submitted questions............................... 103
David Gattie, Ph.D., Associate Professor, College of Engineering,
and Resident Fellow, Center for International Trade and
Security, University of Georgia................................ 37
Prepared statement \1\
Timothy H. Profeta, Director, Nicholas Institute for
Environmental Policy Solutions, Duke University................ 38
Prepared statement........................................... 41
Answers to submitted questions \2\........................... 107
Submitted Material
Letter of December 4, 2019, from Julia Olson, Executive Director,
Our Children's Trust, to Mr. Pallone and Mr. Walden, submitted
by Mr. Tonko \3\
Letter of December 4, 2019, from Sean O'Neill, Senior Vice
President, Government Affairs, Portland Cement Association, to
Mr. Tonko and Mr. Shimkus, submitted by Mr. Tonko.............. 76
----------
\1\ The prepared statement of Dr. Gattie has been retained in committee
files and also is available at https://docs.house.gov/meetings/IF/IF18/
20191205/110295/HHRG-116-IF18-Wstate-GattieD-20191205.pdf.
\2\ Mr. Profeta did not answer submitted questions for the record by
the time of printing.
\3\ The letter has been retained in committee files and also is
available at https://docs.house.gov/meetings/IF/IF18/20191205/110295/
HHRG-116-IF18-20191205-SD003.pdf.
Letter of December 4, 2019, from Michael Gerrard and John C.
Dernbach, coeditors, ``Legal Pathways to Deep Decarbonization
in the United States,'' to Mr. Tonko and Mr. Shimkus, submitted
by Mr. Tonko................................................... 79
Letter of December 5, 2019, from Nathaniel Keohane, Senior Vice
President, Climate, Environmental Defense Fund, to Mr. Tonko
and Mr. Shimkus, submitted by Mr. Tonko........................ 83
Letter of June 21, 2018, from Food & Water Watch, et al., to Hon.
Raul M. Grijalva and Hon. Mark Pocan, cochairs, Congressional
Progressive Caucus, submitted by Ms. Barragan.................. 89
Letter of November 22, 2019, from Advocates for Springfield, et
al., to Hon. Nancy Pelosi, Speaker of the House of
Representatives, and Hon. Kathy Castor, Chair, House Select
Committee on the Climate Crisis, submitted by Ms. Barragan..... 92
BUILDING A 100 PERCENT CLEAN ECONOMY: SOLUTIONS FOR ECONOMY-WIDE DEEP
DECARBONIZATION
----------
THURSDAY, DECEMBER 5, 2019
House of Representatives,
Subcommittee on Environment and Climate Change,
Committee on Energy and Commerce,
Washington, DC.
The subcommittee met, pursuant to call, at 10:33 a.m., in
the John D. Dingell Room 2123, Rayburn House Office Building,
Hon. Paul Tonko (chairman of the subcommittee) presiding.
Members present: Representatives Tonko, Clarke, Peters,
Barragan, McEachin, Blunt Rochester, Soto, DeGette, Schakowsky,
Matsui, McNerney, Ruiz, Pallone (ex officio), Shimkus
(subcommittee ranking member), Rodgers, McKinley, Johnson,
Long, Carter, Duncan, and Walden (ex officio).
Staff present: Adam Fischer, Policy Analyst; Jean Fruci,
Energy and Environment Policy Advisor; Omar Guzman-Toro, Policy
Analyst; Caitlin Haberman, Professional Staff Member; Rick
Kessler, Senior Advisor and Staff Director, Energy and
Environment; Brendan Larkin, Policy Coordinator; Mel Peffers,
Environment Fellow; Nikki Roy, Policy Coordinator; Peter
Kielty, Minority General Counsel; Mary Martin, Minority Chief
Counsel, Energy, and Environment and Climate Change; Brandon
Mooney, Minority Deputy Chief Counsel, Energy; Brannon Rains,
Minority Legislative Clerk; and Peter Spencer, Minority Senior
Professional Staff Member, Environment and Climate Change.
Mr. Tonko. Good morning, everyone. The Subcommittee on
Environment and Climate Change will now come to order.
I recognize myself for 5 minutes for the purposes of an
opening statement.
OPENING STATEMENT OF HON. PAUL TONKO, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF NEW YORK
For the past several months, the committee has held a
series of hearings and stakeholder meetings examining how our
Nation can achieve net zero greenhouse gas emissions by mid-
century.
Our past hearings have focused on sector-specific issues
and solutions. We have examined the industrial, electricity,
transportation, and building sectors. Today, we will turn our
attention to economy-wide solutions, a category of policies
that can result in emissions reductions from across multiple
sectors.
We know, to achieve ambitious climate targets, innovations
are needed in technology and policy and in finance to
accelerate the clean-energy transition and reduce the cost of
economy-wide decarbonization.
These crosscutting policies take many different forms. It
can include how the data revolution can promote greater
efficiency through digitization. It also covers how access to
capital and financing opportunities can support deployment of
new and needed technologies and infrastructure.
Low-emission solutions, ranging from energy-efficient
appliances to electric buses, are commercially available and
pay for themselves over time, but the upfront cost can be a
barrier. Having financing options available can accelerate
widespread adoption of these solutions.
Another potentially powerful policy is carbon pricing,
which remains a proven, economically efficient method to put us
on the lowest-cost pathway to achieving major emissions
reductions.
Today, the costs of climate pollution are not borne by
polluters. In my opinion, that is wrong, fundamentally wrong.
Carbon pricing connects--or corrects, rather--a market
failure and establishes a long-term price signal to allow each
firm to determine how to best manage its assets. While we know
market-based policies, like carbon pricing, can be effective,
the policy design really matters. We have seen bad programs
fail and good ones succeed. And the last decade of experiences
from State and foreign governments provides many, many examples
of best practices and lessons learned.
Today, millions of Americans are already living under a
carbon price in California and the RGGI states. The sky has not
fallen, and industry has not crumbled. In fact, those residents
are experiencing benefits in terms of public health and new
revenue for investments in efficiency and infrastructure
programs.
Pricing programs can and should be designed to minimize
impacts to consumers, protect low-income households, and
preserve the global competitiveness of U.S. energy-intensive,
trade-exposed industries.
They should also provide flexibility for regulated entities
to the extent that it does not undermine the integrity of the
program or result in harmful, inequitable outcomes.
We know that multidecade climate targets require policy
certainty. Congressional action can create predictability and
credibility while sending the signals that will be necessary to
impact long-term planning and investment decisions.
Despite some of the strengths of these types of policies,
we must keep in mind that there is no silver bullet to
achieving deep decarbonization. We must embrace a broad
portfolio of solutions and commit to reinvesting revenues from
a pricing program to support complementary policies.
Complementary policies that promote R&D, infrastructure
deployment, workforce development, community and worker
programs, environmental justice and restoration, resilience,
and energy efficiency must be part of our efforts. These types
of investments will ensure emissions reductions occur quickly,
cheaply, and fairly, with the benefits of a cleaner economy
reaching every community.
We will also hear about another potential model based on
existing environmental statutes that gives State governments
greater responsibility and flexibility to direct their climate
mitigation efforts and achieve nationally determined goals.
We know States and regions face unique climate challenges.
I look forward to exploring how we might be able to translate
the cooperative federalism model that has resulted in such
significant air, water, and soil pollution reductions over the
past four decades into the climate context.
I truly believe many of us share a common goal of putting
forward cost-effective solutions that protect low-income
consumers, promote U.S. competitiveness and invest in energy
innovation and infrastructure while ensuring meaningful
emissions reductions.
Designing economy-wide solutions that fit with effective
sector-specific policies will be key to assembling a meaningful
comprehensive climate package.
I thank our witnesses for joining us today. We look forward
to your input and your perspective and providing the sort of
information that we find very important to these discussions. I
look forward to your testimony.
[The prepared statement of Mr. Tonko follows:]
Prepared Statement of Hon. Paul Tonko
The Subcommittee on Environment and Climate Change will now
come to order. I recognize myself for 5 minutes for the
purposes of an opening statement.
For the past several months, the committee has held a
series of hearings and stakeholder meetings examining how our
Nation can achieve net zero greenhouse gas emissions by mid-
century.
Our past hearings have focused on sector-specific issues
and solutions. We have examined the industrial, electricity,
transportation, and building sectors.
Today, we will turn our attention to economy-wide
solutions, a category of policies that can result in emissions
reductions from across multiple sectors.
We know to achieve ambitious climate targets, innovations
are needed in technology, policy, and finance to accelerate the
clean energy transition and reduce the costs of economy-wide
decarbonization.
These cross-cutting policies take many different forms.
It can include how the data revolution can promote greater
efficiency through digitization.
It also covers how access to capital and financing
opportunities can support deployment of new and needed
technologies and infrastructure.
Low-emissions solutions, ranging from energy-efficient
appliances to electric buses, are commercially available and
pay for themselves over time, but the upfront costs can be a
barrier. Having financing options available can accelerate
widespread adoption of these solutions.
Another potentially powerful policy is carbon pricing,
which remains a proven, economically efficient method to put us
on the lowest-cost pathway to achieving major emissions
reductions.
Today the costs of climate pollution are not borne by
polluters. In my opinion, that is wrong.
Carbon pricing corrects a market failure and establishes a
long-term price signal to allow each firm to determine how to
best manage their assets.
While we know market-based policies, like carbon pricing,
can be effective, the policy design really matters.
We have seen bad programs fail and good ones succeed, and
the last decade of experiences from State and foreign
governments provide many examples of best practices and lessons
learned.
Today, millions of Americans are already living under a
carbon price in California and the RGGI States. The sky has not
fallen, and industry has not crumbled.
In fact, those residents are experiencing benefits in terms
of public health and new revenue for investments in efficiency
and infrastructure programs.
Pricing programs can, and should, be designed to minimize
impacts to consumers, protect low-income households, and
preserve the global competitiveness of U.S. energy-intensive,
trade-exposed industries.
They should also provide flexibility for regulated entities
to the extent that it does not undermine the integrity of the
program or result in harmful, inequitable outcomes.
We know that multidecade climate targets require policy
certainty. Congressional action can create predictability and
credibility, while sending the signals that will be necessary
to impact long-term planning and investment decisions.
Despite some of the strengths of these types of policies,
we must keep in mind there is no silver bullet to achieving
deep decarbonization. We must embrace a broad portfolio of
solutions and commit to reinvesting revenues from a pricing
program to support complementary policies.
Complementary policies that promote R&D, infrastructure
deployment, workforce development, community and worker
programs, environmental justice and restoration, resilience,
and energy efficiency must be part of our efforts.
These types of investments will ensure emissions reductions
occur quicker, cheaper, and fairer with the benefits of a
cleaner economy reaching every community.
We will also hear about another potential model, based on
existing environmental statutes, that gives State governments
greater responsibility and flexibility to direct their climate
mitigation efforts and achieve nationally determined goals.
We know States and regions faces unique climate challenges.
I look forward to exploring how we might be able to
translate the cooperative federalism model that has resulted in
such significant air, water, and soil pollution reductions over
the past four decades into the climate context.
I truly believe many of us share a common goal of putting
forward cost-effective solutions that protect low-income
consumers, promote U.S. competitiveness, and invest in energy
innovation and infrastructure while ensuring meaningful
emissions reductions.
Designing economy-wide solutions that fit with effective
sector-specific policies will be key to assembling a
meaningful, comprehensive climate package.
I thank our witnesses for joining us and providing input
into this important discussion. I look forward to your
testimony.
Mr. Tonko. With that, I will now recognize Mr. Shimkus,
Representative Shimkus, being the ranking member of our
Subcommittee on Environment and Climate Change, for 5 minutes
for his opening statement.
OPENING STATEMENT OF HON. JOHN SHIMKUS, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ILLINOIS
Mr. Shimkus. Thank you, Mr. Chairman.
And to my friends, a word of warning. When I was going over
the testimony and what we have gone--you know, the Congress and
where we are at today, it was only 8 years ago that we were
trying to move to a cap-and-trade program, and we were moving
to national healthcare under Obamacare. Done poorly, the
results were politically a change in Congress. So it is just
the facts that that is what occurred.
So I think for anyone to not focus on the cost of
transition, you are going down a dangerous path. As we see what
is going on in France with the yellow vests based upon gas
prices, what we have just seen in Iran, based upon an increase
in gas prices, for anyone to think that consumers are not going
to be price conscious in this debate, I would just say a word
of warning.
I am particularly touched by Dr. Gattie's testimony, and I
would encourage my colleagues to look at the charts in his
testimony, which highlight really a flat-line growth on fossil
use and fossil emissions in the developed world and an
astronomical increase in the developing countries, especially
the Asian-Pacific region.
So a cost burden on us with no international constraint--
the recent announcement by China just yesterday--will indicate
that we will do this for nothing. So that is where--you know,
Ranking Member Walden talks about those issues of resiliency
and efficiency and technology and being able to mitigate the
changes that are going to occur, whether we are engaged or not.
So we have had a great series of hearings. As I talked to
the panel, as I was able to a few minutes beforehand, which, as
the chairman has noted, is going to--been addressing across the
spectrum of our energy use, whether it is in the transportation
sector, the manufacturing, the generation, and I applaud him
for that, because it is really that holistic approach of
looking at the entire economy.
But we should not not look at what is going on in the rest
of the world when it impinges upon the fact of derailing a
properly developed policy that--I think I even heard in the
opening statement that--that costs will be increased, and the
industries that will be charged will pass that along. That is
just an economic fact and reality.
So I look forward to the hearing. I know they are all noted
panelists, great testimony. We appreciate your time and your
effort.
This is a tough issue. The majority has decided to wrap its
arms around it and try to address it, and we are trying to not
be in their way as we try to get to a point where there can be
growth and development while we address the emission debate,
not only in this country but across the country--across the
world, actually.
So, with that, Mr. Chairman, I am going to submit my
statement for the record. This is just off the heart, as you
could tell.
And I yield back my time.
[The prepared statement of Mr. Shimkus follows:]
Prepared Statement of Hon. John Shimkus
When the majority initiated this series of hearings in
July, it made clear that its legislative goals would be bold
and sweeping--and would touch pretty much every part of
people's lives.
Transforming the American economy to produce net zero
carbon dioxide emissions in 30 years, as the majority has
proposed, requires forcing dramatic change on a scale that is
hard for most people to comprehend. And the hearing record
developed so far has just touched the surface of what any zero-
emissions transformation in the United States would truly
entail.
Over the course of the past 5 months, we've heard testimony
on the industrial sector, the transportation sector, the power
sector and discussed the practical, technological, and economic
barriers to eliminating most of the emissions in those sectors.
Today's hearing rounds out the series with a look at
``economy-wide deep decarbonization'' measures--basically the
regulatory approaches that the majority believes are necessary
to cap and to tax and to otherwise restrict carbon dioxide
emissions across the U.S. economy.
From the various proposals circulating in Congress, it
appears that many proponents of deep decarbonization--
regardless of the state of technology--aim to increase the cost
of generating and transmitting electrical power, fueling
vehicles, growing food, and making the products of modern
infrastructure, manufacturing, and industry.
What is not often discussed is whether this drive to change
our domestic energy and economic system is really the most
appropriate and effective approach as a matter of U.S. policy
to address climate risks.
From the beginning of this Congress, I have urged that we
step back and keep our sights on the problems we are trying to
solve. It is useful to revisit some core lessons of this year's
climate hearings.
First, domestic decarbonization goals are not possible to
achieve with current technology, regardless of the proposed
regulatory programs. If we do not have the technology, no new
regulation, standard, or international agreement is going to
preserve affordable energy and the goods and services people
rely upon in their daily lives. Raise the costs on this energy
or goods and services and you lose public support. That will be
true in the United States, and any other place in the world.
Second, the carbon dioxide emissions problem is a global
issue and domestic policies must be considered against this
persistent fact.
Recent data from the U.S. Energy Information Administration
show some leveling of growth in global carbon dioxide
emissions, but emissions will continue to rise as nations
continue to seek the benefits of energy, power, transportation,
and industrial development in their societies. This is
particularly true for China, India and the rest of the
developing world.
Third, climate policy exists under a broader umbrella of
U.S. national interests relating to national and economic
security.
You only need to review the latest natural gas arrangements
relating to China and Russia or observe the tremendous benefits
our shale revolution has brought to the security of our Eastern
European allies to see that energy diplomacy is vital to our
strategic interests and cannot be subordinated to anti-oil
sentiments. And the same applies to our development and
deployment of nuclear technology, which we'll talk about today.
As I've noted in previous hearings, focusing on global
energy and economic realities will help us focus on where the
real gains can be achieved in reducing future emissions and
maintaining the prosperity necessary for addressing future
climate risks. These gains will not come from radically and
expensively transforming a mature, 20-trillion-dollar U.S.
economy but from providing the modern, clean and low-emissions
technologies to nations still putting their modern economies in
place.
With this in mind, we should widen our focus and look at
domestic climate policies through the lens of broader U.S.
national security interests. For this reason, I would like to
welcome our witness from the University of Georgia, David
Gattie. His testimony, which focuses on the national security
and climate benefits of nuclear technology, helps to reframe
how we should think about our domestic climate policies.
Reorienting our climate policy into a policy of U.S.
innovation leadership, much like the Nation pursued with its
initial Atoms for Peace program or even our recent work to
support our European allies with energy exports, represents a
sound, positive approach to these global issues. The more we
focus on this, and the innovation to make it happen, the
better.
Mr. Tonko. The gentleman yields back.
And the Chair now recognizes Representative Pallone,
Chairman Pallone of the full committee, for 5 minutes for his
opening statement.
OPENING STATEMENT OF HON. FRANK PALLONE, Jr., A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF NEW JERSEY
Mr. Pallone. Thank you, Chairman Tonko.
Today's hearing is the seventh hearing in the committee's
work to achieve a 100 percent clean economy by 2050. So far, we
have examined ways to decarbonize specific sectors of the U.S.
economy, including the electricity sector, buildings,
transportation, and heavy industry. And we also discussed the
impact of climate change on frontline communities.
Throughout these hearings, witnesses told us that we need
sector-specific solutions for climate action, especially in
sectors that are more difficult to decarbonize. But they also
repeatedly pointed to the need for economy-wide measures to
ensure we cut pollution across all sectors. So, today, we will
explore those crosscutting mechanisms and the role they should
play in addressing the climate crisis.
This hearing couldn't come at a more important time. As we
speak, world leaders are meeting in Madrid for the 25th
Conference of the Parties to the United Nations Framework
Convention on Climate Change, or COP25. President Trump is
noticeably absent from the summit. This is the same President
who just 1 month ago started the formal process of withdrawing
the United States from the Paris Agreement. And if President
Trump gets his way, we will be the only country to oppose and
abandon the Paris Agreement.
And I had the privilege to travel to COP25 in Madrid with a
bicameral congressional delegation, which included
Representatives Castor, Peters, and Dingell from our committee.
And on our visit, we reminded world leaders and activists that,
despite President Trump's retreat from this global crisis, that
we are still in. And they made it clear they were grateful that
someone was there to represent the United States, because our
leadership is so important.
Our continued commitment to the Paris Agreement is more
important than ever. New information comes out each week
stressing the urgent need for climate action. Just last week,
for instance, the United Nations released its annual Emissions
Gap Report showing the divergence between current emissions
projections and the reductions needed to avoid catastrophic
climate change. The report warned that we are on track to miss
those targets--and not just by an inch, but by a mile.
The Paris Agreement adopted the science-based target of
limited warming to 1.5 to 2 degrees Celsius by 2100. The U.N.
report, however, warned that we are heading towards 3.9 degrees
of warming by the end of the century. So think about that for a
moment, that that's almost double the limit needed to avoid the
most damaging consequences of climate change.
Not meeting these targets would have devastating
consequences. It would lead to increasingly frequent extreme
weather events, more damaging wildfires, rapid sea level rise,
more persistent flooding and droughts, threats to entire
ecosystems and food supplies, and countless other hazards.
Meanwhile, there was a report by the Global Carbon Project
released just yesterday that showed that carbon dioxide
emissions would hit an all-time high this year. And on Tuesday,
the World Meteorological Organization reported that 2019 will
be the second- or third-hottest year ever recorded.
And these are startling trends. But if there is one thing I
learned in Madrid, it is that this is not a time for despair.
It is time for bold leadership and ambitious action. One of the
key reasons that the rest of the world is not meeting these
targets is because of a lack of leadership they are seeing
right now from the Trump administration. And we heard over and
over again that, if the United States withdraws and doesn't
participate in the future, the other countries are not likely
to go along, because U.S. leadership is what most countries
look at. And that is why we have to continue to exercise that
leadership. And it is also why this committee is hard at
working and developing our proposal to reach net zero emissions
by 2050. I think this is the consensus from the scientific
community on what we have to do to avoid the worst impacts of
climate change.
So, today, we are going to hear about options for robust
comprehensive and economy-wide policy solutions to hit that
target. We hear about the essential role the Federal Government
can play. And, again, if I can go back to the weekend
conference, I think that everyone knows that the State and the
local governments continue to play a major role and can do a
lot of the things that we need to do to reach the target of
2050, but it is not enough. The Federal Government has to get
involved.
So, finally, we are going be to hear about how economy-wide
climate action will not only reduce emissions but will also
stimulate the economy. By investing in the low- and zero-carbon
technologies of the future, the U.S. can become a world leader
in clean energy innovation, and I look forward to hearing from
our witnesses about that.
And thank you again, Chairman Tonko, and I yield back.
[The prepared statement of Mr. Pallone follows:]
Prepared Statement of Hon. Frank Pallone, Jr.
Today's hearing is the seventh hearing in the committee's
work to achieve a 100 percent clean economy by 2050. So far, we
have examined ways to decarbonize specific sectors of the U.S.
economy--including the electricity sector, buildings,
transportation, and heavy industry. We also discussed the
impact of climate change on frontline communities.
Throughout these hearings, witnesses told us that we need
sector-specific solutions for climate action, especially in
sectors that are more difficult to decarbonize. But they also
repeatedly pointed to the need for economy-wide measures to
ensure we cut pollution across all sectors. Today, we'll
explore these crosscutting mechanisms and the role they should
play in addressing the climate crisis.
This hearing couldn't come at a more important time. As we
speak, world leaders are meeting in Madrid for the 25th
Conference of the Parties to the United Nations Framework
Convention on Climate Change, or COP 25. President Trump is
noticeably absent from the summit. This is the same President
who, just 1 month ago, started the formal process of
withdrawing the United States from the Paris Agreement. If
President Trump gets his way, we will be the only country to
oppose and abandon the Agreement.
I had the privilege to travel to COP 25 with a bicameral
Congressional delegation, which included Reps. Castor, Peters
and Dingell. On our visit, we reminded world leaders and
activists that, despite the President's retreat from this
global crisis, we are still in. And, they made clear that they
were grateful that someone was there to represent the United
States because our leadership is so important.
Our continued commitment to the Paris Agreement is more
important than ever. New information comes out each week
stressing the urgent need for climate action. Just last week,
for instance, the United Nations released its annual Emissions
Gap report, showing the divergence between current emissions
projections and the reductions needed to avoid catastrophic
climate change. The report warned that we're on track to miss
those targets. And not just by an inch, but by a mile.
The Paris Agreement adopted the science-based target of
limiting warming to 1.5 to 2 degrees Celsius by 2100. The U.N.
report, however, warned that we're heading toward 3.9 degrees
of warming by the end of the century. Think about that for a
moment--that's almost double the limit needed to avoid the most
damaging consequences of climate change.
Not meeting these targets would have devastating
consequences. It would lead to increasingly frequent extreme
weather events, more damaging wildfires, rapid sea level rise,
more persistent flooding and droughts, threats to entire
ecosystems and food supplies, and countless other hazards.
Meanwhile, a report by the Global Carbon Project, released
just yesterday, showed that carbon dioxide emissions will hit
an all-time high this year. And on Tuesday, the World
Meteorological Organization reported that 2019 will be the
second or third hottest year ever recorded.
These are startling trends. But if there's one thing I
learned in Spain, it's that this is not a time for despair.
It's a time for bold leadership and ambitious action. One of
the key reasons that the rest of the world is not meeting these
targets is because of the lack of leadership they are seeing
right now from the Trump administration.
That is why this committee is hard at work developing our
proposal to reach net zero emissions by 2050. This is the
consensus from the scientific community on what we must do to
avoid the worst impacts of climate change.
Today we will hear about options for robust, comprehensive,
and economy-wide policy solutions to hit that target. We will
also hear about the essential role the Federal Government must
play.
And finally, we will hear about how economy-wide climate
action will not only reduce emissions, but will also stimulate
the economy. By investing in the low- and zero-carbon
technologies of the future, the United States can become a
world leader in clean energy innovation. I look forward to
hearing from our witnesses. Thank you, Chairman Tonko, and I
yield back.
Mr. Tonko. The gentleman yields back.
The Chair now recognizes Representative Walden, the ranking
member of the full committee, for 5 minutes for his opening
statement, please.
OPENING STATEMENT OF HON. GREG WALDEN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF OREGON
Mr. Walden. Good morning, Mr. Chairman, and to our
witnesses, thank you for being here.
I appreciate the work these hearings have been doing to
inform our--your plans for decarbonizing the Nation by 2050.
The hearings have provided useful information and necessary
context to your plans, and that is helpful. I still hope we
will have a hearing on the Green New Deal sometime, since it is
talked about by a lot of leaders of the Democratic Party, and
we haven't had that hearing in this context, and we should.
We have heard testimony that underscores the essential role
of technological innovation and addressing the demand for
cleaner energy, transportation, and industrial systems. This
echoes the need for bipartisan work to find practical solutions
so we can continue to lower emissions and unleash American
innovation.
Republicans support realistic steps to reduce emissions and
address current and future climate risks. This requires we
examine the cost, effectiveness, and economic impacts of
solutions proposed to address these risks and that we do not
undermine the economic priorities of communities and States
around the Nation. We can have a cleaner environment and a
strong American economy.
Over the past year, we have pointed out that restructuring
old top-down--excuse me--resurrecting old top-down policies,
that will hurt American consumers and workers. We have invited
our colleagues to work instead on bipartisan policies focused
on the bottom-up benefits from incentivizing and deploying
innovation that we can move into law.
In fact, we have a dozen bipartisan measures that we could
turn into law that could help reduce emissions and spur jobs
and innovations. Hopefully, Mr. Chairman, we will get to work
on passing some of those measures soon.
Today's hearing offers two approaches to climate policy.
One reflects the majority's preferred approach to impose what
we would call costly carbon taxes and old cap-and-trade
regulations and schemes. These are some of the top-down
regulatory policies that some of us have been warning about.
Not only do these policies severely disrupt the American
consumers, but they have no chance of becoming law.
Just read the papers around the world: Top-down energy
policies are not working. From the Paris yellow vests protest
last year to the riots across Chile, poor and middle class,
fueled no doubt by some other resentments too, rejected
increasing transportation costs in violent protests.
Ironically, the Chilean riots caused the International
Climate Conference to have to move to Madrid. One can only
imagine what will happen if the decarbonization schemes
throughout Europe really begin to turn the regulatory screws on
consumers as European bureaucrats seek to meet proposed
emissions targets in 10 years. And by the way, their record
under the Paris accords is not very sterling.
This is not the way to address global emissions. The more
realistic approach is to focus on the advanced technologies,
mainly developed in the United States, that can meaningfully
address emissions where they are increasing the fastest, which
are in poorer nations striving for the benefits of advanced
energy and industrial system. They actually want electricity.
Who knew, right? So let's do it in a more efficient way.
Recent Energy Information Administration data show that
fossil energy, even with the tremendous growth of renewables,
will remain a dominant form of energy in developing nations
through 2050. This is where the United States can make a
difference, providing the innovative fossil and other advanced
cleaner technologies to meet this growing demand.
Tackling the emissions where they are growing the fastest
represents the broader approach to climate policy that
Professor Gattie can speak about this morning.
The deployment of our new nuclear technology to address
climate change and to preserve our national security interests
is an essential element in any real serious climate policy.
This is not only a sensible way to address emissions; it is in
keeping with our goals to resurrect our technological
leadership in nuclear energy around the world for broader
national energy security reasons, much as unleashing the U.S.
LNG from our shale revolution restored our ability to counter
Russia in energy markets while also driving cleaner technology
and fuel switching that has resulted in carbon emissions
reduction.
For our part on the Energy and Commerce Committee, we can
work together, as we have in the past, to reduce barriers to
innovation, to enable the United States to deploy new
technologies.
So let's reject taxation and regulation that leads to
economic stagnation and pursue practical policies of
innovation, conservation, and preparation that can actually
drive our economic engines and make realistic headway in
curbing emissions from advanced carbon capture to nuclear
technology to innovative hydropower.
[The prepared statement of Mr. Walden follows:]
Prepared Statement of Hon. Greg Walden
Thank you, Mr. Chairman, I appreciate your work in these
hearings to inform your plans for ``decarbonizing'' the Nation
by 2050. The hearings have provided useful information and
necessary context to your plans.
We have heard testimony that underscores the essential role
of technological innovation in addressing the demand for
cleaner energy, transportation, and industrial systems. This
echoes the central message Republicans have for the majority:
Work with us. Work with us on practical solutions so we can
continue to lower emissions and unleash American innovation.
Republicans support realistic steps to reduce emissions and
address current and future climate risks. This requires we
examine the costs, effectiveness, and economic impacts of
solutions proposed to address the risks--and that we do not
undermine the economic priorities of communities and States
around the Nation. We can have a cleaner environment and a
strong American economy.
Over the past year we have pointed out that resurrecting
old, top-down policies that will hurt American consumers and
workers. We've invited our colleagues to work instead with
Republicans on the bipartisan policies--focused on the bottom-
up benefits from incentivizing and deploying innovation--that
we can move into law. In fact, we have a dozen, bipartisan
measures that we could turn into law that would help reduce
emissions and spur jobs and innovation. Hopefully, Mr.
Chairman, we'll get to work on passing those measures.
Today's hearing offers two approaches to climate policy.
One reflects the majority's preferred approach to impose
costly, carbon taxes and old, cap-and-trade regulations and
schemes. These are some of the top-down regulatory policies we
have been warning about. Not only do these policies severely
disrupt the American consumer, but they have no chance of
becoming law.
Just read the newspapers. Around the world, top-down energy
policies are not working, from the Paris yellow vests protests
last year, to the riots across Chile, the poor and middle
class, fueled no doubt by other resentments, rejected
increasing transportation costs in violent protests.
Ironically, the Chilean riots caused the international climate
conference to relocate to Madrid. One can only imagine what
will happen if the decarbonization schemes throughout Europe
really begin to turn the regulatory screws on consumers as
European bureaucrats seek to meet proposed emissions targets in
10 years.
This is not the way to address global emissions. The more
realistic approach is to focus on the advanced technologies--
developed in the United States--that can meaningfully address
emissions where they are increasing the fastest, which are in
poorer nations striving for the benefits of advanced energy and
industrial systems.
Recent Energy Information Administration data shows that
fossil energy, even with the tremendous growth of renewables,
will remain a dominant form of energy in developing nations
through 2050. This is where the U.S. can make a difference:
providing the innovative fossil and other advanced, cleaner
technologies to meet this growing demand.
Tackling the emissions where they are growing the fastest
represents the broader approach to climate policy that
Professor Gattie can speak about this morning. The deployment
of our new nuclear technology to address climate change and to
preserve our national security interests is an essential
element in serious climate policy.
This is not only a sensible way to address emissions, it is
in keeping with our goals to resurrect our technological
leadership in nuclear technology around the world for broader
national and energy security reasons--much as unleashing U.S.
LNG from our shale revolution restored our ability to counter
Russia in energy markets, while also driving cleaner
technology.
For our part on Energy and Commerce, let's continue the
work we have been doing in the past few Congresses that will
reduce the barriers to innovation and enable the United States
to deploy new technologies. Let's reject taxation and
regulation that leads to economic stagnation and pursue
practical policies of innovation, conservation, and preparation
to drive our economic engines and make realistic headway in
curbing emissions, from advanced carbon capture to nuclear
technology to innovative hydropower.
Mr. Walden. With that, Mr. Chairman, I would yield to the
ranking--the lead Republican on this.
Mr. Shimkus. Thank you.
The thing you highlighted and I want to highlight also,
let's put this in another current technology. Why is Burisma in
the news? Why is Ukraine in the news? Because a Russian
pipeline goes through Ukraine. They are afraid of extortion by
Russia. I do Eastern European issues all the time. This LNG
debate is critical. And this--international security issues
cannot be subordinated by anti-oil sentiment for freedom and
democracy and rule of law in Eastern Europe.
Thank you.
Mr. Walden. I yield back.
Mr. Tonko. And the gentleman yields back.
The Chair would like to remind Members that, pursuant to
committee rules, all Members' written opening statements shall
be made part of the record.
I will now introduce our witnesses for today's hearing. We
welcome them again and thank them for their input.
First, we have Mr. Daniel Esty, director the Center for
Environmental Law and Policy and Hillhouse Professor of
Environmental Law and Policy at Yale University.
Welcome Mr. Esty.
Dr. Noah Kaufman, research scholar, Center on Global Energy
Policy at Columbia University.
Welcome, Dr. Kaufman.
And Mr. David Gattie, associate professor at the College of
Engineering, University of Georgia.
We welcome you.
And then Mr. Tim Profeta, director of the Nicholas
Institute for Environmental Policies Solutions at Duke
University.
And welcome, Mr. Profeta.
So, before we begin, I would like to explain the lighting
system. In front of you are a series of lights. The light will
initially be green at the start of your opening statement. The
light will turn yellow when you have 1 minute remaining. Please
begin to wrap up your testimony at that point. The light will
turn red when your time has expired.
And at this time, the Chair will now recognize Mr. Esty for
5 minutes to provide his opening statement, please.
STATEMENTS OF DANIEL C. ESTY, HILLHOUSE PROFESSOR OF
ENVIRONMENTAL LAW & POLICY AND DIRECTOR, YALE CENTER FOR
ENVIRONMENTAL LAW & POLICY, YALE LAW SCHOOL AND YALE SCHOOL OF
FORESTRY & ENVIRONMENTAL STUDIES; NOAH KAUFMAN, Ph.D., RESEARCH
SCHOLAR, CENTER ON GLOBAL ENERGY POLICY, COLUMBIA UNIVERSITY
SCHOOL OF INTERNATIONAL AND PUBLIC AFFAIRS; DAVID GATTIE,
Ph.D., ASSOCIATE PROFESSOR, COLLEGE OF ENGINEERING, AND
RESIDENT FELLOW, CENTER FOR INTERNATIONAL TRADE AND SECURITY,
UNIVERSITY OF GEORGIA; AND TIMOTHY H. PROFETA, DIRECTOR,
NICHOLAS INSTITUTE FOR ENVIRONMENTAL POLICY SOLUTIONS, DUKE
UNIVERSITY
STATEMENT OF DANIEL C. ESTY
Mr. Esty. Thank you very much, Mr. Chairman.
Thank you, Ranking Member Shimkus. And thank you all for
being here for what I hope will be a conversation that gets
into the details of how we take up this critical issue of deep
decarbonization but how we do it in a way that addresses not
just climate change but the need for a vibrant American
economy, for competitiveness, for jobs, and for careful
attention to the transition that we need to undertake in the
coming decades.
I have spent more than 30 years on this issue going back to
time in the late 1980s and early 1990s as a negotiator for
climate change on behalf of the U.S. Environmental Protection
Agency, more recently as commissioner of Connecticut's
Department of Energy and Environmental Protection.
But I do want to take you back just for a moment to 1992
when the Framework Convention on Climate Change was finalized.
And I remember being taken aside by the guy who was the
secretary general of the 1992 Rio Earth Summit.
And he said to me, ``Dan, as you finalize this climate
change agreement, remember there is only two possible outcomes:
success and real success.''
And at the time, I wasn't quite focused on what he was
saying. But the point was, when you get 120 Prime Ministers and
Presidents together, success is going to be declared. The real
test is what occurs over the intervening decades.
And, frankly, we did not see success in a couple of decades
after that agreement. And I think the committee, the
subcommittee here today, now is doing the right thing of
digging into the details of what is the policy framework that
can deliver for us a decarbonized future but attentive to these
other issues of competitiveness, of jobs, of economic security,
and of a just transition that attends to those whose lives and
communities will have to evolve as we move forward.
My own experience suggests four things are critical, four
issues need to be given careful attention: the incentives for
changed behavior, the need to drive innovation as the key
pathway to a low-cost and serious decarbonization strategy, the
opportunity to bring to bear information technology and a whole
range of breakthroughs in science and knowledge that have
occurred since we created our framework of environmental laws
in the 1970s and 1980s, and, finally, a need to focus on
investment and finance.
My own analysis suggests that the greatest weakness of the
20th century approach to environmental protection was not
thinking about where the money would come from to do the things
we need to do.
So let me quickly highlight what I think we can do and
should do. Incentives are at the heart of what is required for
a transition. We have to figure out how to change behavior. And
innovation, I think, has to come broadly. We need technology
breakthroughs, renewable power in various ways, but we need
supporting technologies as well, better batteries and storage,
smart grids, smart homes, smart appliances. And we really need
to think about innovation even more broadly: How do we engage
the public in innovative ways? What are the policies that we
can do that are innovative, and what kind of partnerships will
this transition require?
My own view is that we need to put much more time and
attention into what I call a 21st century strategy of green
lights for innovation. The 20th century approach was red
lights, stop signs, don't do this, don't do that, don't
pollute. The 21st century has to be signaling to our
entrepreneurial class, to our innovators, to our creative
spirits where answers are required and to really spur on the
changes that we know are needed.
And I think we know how to do that. We do it in part with
economy-wide price signals. My own preference would be for a
slowly rising carbon charge beginning at $5 per ton of carbon
equivalent and rising $5 per ton per year for 20 years.
The advantage of that is the early low price is not jarring
to people that made choices based on prior expectations about
energy prices and markets, but the final price of $100 a ton
becomes the signal that people pay attention to for all new
investments, and it ensures the transition is smooth and can
accommodate those whose lives are going to change.
I think second, we have not paid--or third, we have not
paid attention to the opportunities to bring to bear digital
advances of the last 20 years. So special effort should be
given to thinking about how we do that, including the ideas of
benchmarking performance at the national scale, the State
scale, the community scale, and the corporate scale, and
ensuring that we can scorecard performance, identify leaders,
spur on laggards, and find best practices.
Finally, think I think we need innovation in investment and
finance. We need green bonds, green banks, and a whole new set
of strategies for innovatively steering money to the
investments that need to be made. And I would be happy to
answer questions about my own experience helping to set up
Connecticut's green bank that has done dramatic things in this
regard. Thank you very much.
[The prepared statement of Mr. Esty follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Tonko. Thank you, Mr. Esty.
Now, we will recognize Dr. Kaufman for 5 minutes, please.
STATEMENT OF NOAH KAUFMAN, Ph.D.
Dr. Kaufman. Chairman Tonko, Ranking Member Shimkus,
members of the committee, it is an honor to be here. Thank you
for the invitation.
To build a clean economy, we need to align the incentives,
the producers, consumers, and investors across the entire U.S.
economy with the long-term goal of net zero emissions.
Any economist will tell you that one critical piece of a
deep decarbonization strategy is a price on carbon. That is
because a carbon price encourages emissions reductions wherever
and however they can be achieved at a low cost without needing
to know beforehand what those reductions will be. Minimizing
the cost of decarbonization means less of a burden on all of
us, which should enable faster decarbonization.
Research led by the Center on Global Energy Policy at
Columbia University suggests that any of the eight carbon
prices proposed to Congress this year would dramatically change
the future pathway for U.S. emissions from roughly flat to
rapidly declining, far beyond the U.S. commitments to the Paris
Agreement.
So putting a price on carbon should be a no-brainer. But
how a carbon price is integrated into a broader-struck policy
strategy will influence its effectiveness and also the public's
support. Here are four suggestions.
First, protect those who can't afford to pay more. The
payments of the carbon price can be returned to Americans as
carbon dividends. As a general rule of thumb, returning 10
percent of the revenue to the bottom 20 percent of the income
distribution can ensure that these households receive more in
carbon dividends than they pay in higher prices. If you want to
protect more households, simply use a larger portion of the
revenue. Under a well-designed carbon price, those who can't
afford to pay more don't have to.
Second, keep U.S. businesses on a level playing field with
foreign competitors. One of many ways to do this is with a
border carbon adjustment, which requires importers of carbon
intensive products to pay the carbon price and provides rebates
to exporters. The United States would be implementing its
climate policy on the global marketplace.
Third, improve economic opportunities for communities that
are dependent on the coal industry, which is the only U.S.
industry likely to experience immediate, significant harm from
a well-designed climate policy.
Over one-third of U.S. coal production comes from one
county. Nearly 90 percent comes from just 50 counties. These
communities helped power the American economy for generations,
often at the expense of their own well-being. They have earned
the support of their country as it transitions away from coal.
Fourth, and finally, surround the carbon price with
policies that enable even faster and cheaper emissions
reductions, which include efficiency standards that overcome
barriers to reduced energy use, funding innovations in low-
carbon solutions, and supporting the early stage deployment of
these solutions that gives them a fair shot at competing
against incumbents like gasoline vehicles and furnaces.
Not every policy will enable faster, cheaper emissions
reductions. We may not need to regulate the same emissions that
are covered by the carbon price or to subsidize mature
technologies, especially if the carbon price has been designed
to be consistent with a desired pathway to net zero emissions.
I want to conclude by applauding the committee for taking
on this challenge. A few years ago, I helped to build a deep
decarbonization strategy for the United States. So I know that
the scope of this problem can be daunting. You have hundreds of
decisions to make. You will hear strong and sometimes
conflicting opinions about every single one of them.
My advice is don't let this complexity distract you from
actions that can really move the needle. Let's establish an
incentive to reduce net emissions across the entire economy.
Let's support low-carbon solutions so that they can compete on
a level playing field. Let's protect American families and
businesses who can't afford price increases, and let's support
coal communities.
With that, I look forward to your questions and comments.
[The prepared statement of Dr. Kaufman follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Tonko. Thank you, Dr. Kaufman.
And, next, we will move to Dr. Gattie. You are recognized,
sir, for 5 minutes, please.
STATEMENT OF DAVID GATTIE, Ph.D.
Dr. Gattie. Thank you, sir.
I want to thank the chairman, the ranking member, and
members of the subcommittee for the opportunity to come before
you today.
My testimony aligns with the following points: America is
facing two national security threats, one around climate change
and the other around the U.S. nuclear power enterprise.
Climate change is global in cause and impacts, and as
carbon emissions increase globally, those impacts won't stop at
U.S. borders simply because we have an aggressive domestic
climate policy.
The U.S. economy and its industrial capacity should be
leveraged to innovate and deploy low- and zero-carbon
technologies in developing economies where carbon emissions are
of greatest concern. Nuclear power should be central to U.S.
policy, with a strategy to develop advanced reactor
technologies for domestic and international deployment, and
America must engage in climate issues globally with national
security as the overarching objective.
Globally, energy consumption and carbon emissions are
increasing, not decreasing. From 2000 to 2018, 90 percent of
the increase in carbon emissions originated in Asian-Pacific
countries, predominantly China and India, while emissions in
the U.S. declined.
Under the most aggressive carbon policy, eliminating all
U.S. emissions would reset global emissions to 2006 levels,
meaning if climate change was a threat in 2006 with U.S.
emissions, climate change is a threat in 2018 without U.S.
emissions.
While exponential growth in nonhydrorenewables is elevating
hopes that renewables are closing the gap on fossil fuels, that
gap isn't closing, it is expanding. For the past 10 years, over
81 percent of global wind and over 82 percent of global solar
were concentrated in countries with substantial fossil fuels,
nuclear, and/or hydro built into their economies, meaning
traditional energy resources have provided the foundation for
renewables to expand.
This recommends a global triage approach with resources and
efforts directed toward regions where the issue is acute or
emerging. In developing regions, countries are at various
stages of economic growth. Therefore, it is necessary to
determine which energy technologies can be deployed effectively
to sustain low-carbon economic development. One such technology
is nuclear power.
Early U.S. nuclear policymakers recognized the strategic
importance of America's nuclear enterprise. To them, nuclear
wasn't just another energy commodity, the fate of which should
be dictated by political calculus, popular opinion, or market
forces alone. Rather, it was central to America's foreign
policy. So their approach was principled and strategic, not
populist and transactional. A key objective was to create the
world's most advanced nuclear technology base from which
mutually beneficial global partnerships could be established
within the emerging liberal international order.
The 21st century is undergoing geopolitical shifts, and
China and Russia are leveraging state-owned nuclear enterprises
as extensions of the state to establish long-term energy and
technology dependencies. If U.S. policy orients our technology
trajectory away from nuclear, it will signal to the world that
America has set aside its commitment to be a reliable partner
in nuclear development, thus opening the door for China and
Russia.
Efforts to decarbonize the U.S. economy will require
investment. If the return on that investment is only a near-
term reduction in U.S. carbon emissions, the U.S. will remain
vulnerable to climate change over the long term as global
emissions increase.
The U.S. cannot insulate itself from the impacts of global
climate change through domestic policies targeting only the
U.S. economy. Therefore, U.S. climate policy must be global and
strategic, keeping in mind that if the U.S. transitions away
from current energy interdependencies, those interdependencies
can develop into vulnerabilities open to exploitation by
energy-rich and technology-advantaged countries that don't
share America's values.
To that end, U.S. policy should focus on developing energy
and technology relationships within developing regions,
cultivated as international investment opportunities for U.S.
industry and coupled to diplomatic efforts of U.S. engagement
and goodwill.
Lastly, the national security implications of U.S. nuclear
power simply cannot be overstated. While nuclear has proven its
value to America, its contributions remain on the horizon as
economic development, climate change, and national security
converge into a perfect storm of 21st century global challenges
that nuclear is capable of addressing.
The U.S. cannot be an energy and climate island. America
must engage globally, and it must do so with national security
as its overarching objective.
Thank you, and I look forward to your questions.\1\
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\1\ The prepared statement of Dr. Gattie has been retained in
committee files and also is available at https://docs.house.gov/
meetings/IF/IF18/20191205/110295/HHRG-116-IF18-Wstate-GattieD-
20191205.pdf.
---------------------------------------------------------------------------
Mr. Tonko. Thank you, Dr. Gattie.
And, finally, Mr. Profeta, you are recognized, sir, for 5
minutes, please.
STATEMENT OF TIM PROFETA
Mr. Profeta. Thank you. Thank you, Chairman Tonko, Ranking
Member Shimkus. Thank you for the opportunity to testify today.
My name is Tim Profeta, and I direct the Nicholas Institute
for Environmental Policy Solutions at Duke University.
Our institute was founded as a nonpartisan resource for
decisionmakers like yourselves striving to solve the most
pressing environmental challenges of our time, including
climate change.
We do not seek to tell policymakers what do to. Rather, we
provide economic, scientific, and legal expertise to help
policymakers most effectively achieve what they wish to
accomplish.
Today's hearing seeks to explore the best means by which to
achieve economy-wide solutions to climate change. The central
point of my testimony today is that Congress should consider a
model that has been successfully proven through our Nation's
history: the Federal/State partnership.
First, climate change is a challenge like none other. It is
perhaps the test of our generation and one of the greatest
collective action challenges in history. In the interest of
time, I will not discuss the reason for acting in my oral
testimony, as I believe the committee has declared an intent to
do so. Instead, let me focus on the options for acting to
reduce the amount of greenhouse gases that are released into
the atmosphere. Such an effort is the most important step we
can take to tackle the climate challenge.
In the absence of Federal actions, many States have been
rising to that challenge, working aggressively to reduce their
emissions. But the national emissions picture is less
encouraging without a Federal climate policy in place. As
emissions go down in some States and sectors, they are going up
in others. The net effect: We have made insufficient progress
towards reductions needed to abate climate change. Nationwide
carbon emissions, in fact, rose in 2018, the biggest increase
in 8 years.
Now, there are many options for economy-wide policies, many
of which I have worked on over the years. A Federal price on
carbon, either set through a cap-and-trade program or a carbon
fee, is an economically effective way to drive investment and
innovation. If Congress could muster the political will to pass
such a proposal, it may still be the most effective approach
for securing nationwide reductions. But those of us that work
on climate policy, however, have witnessed the political
resistance noted by the ranking member to such a proposal.
Today, I am proposing another way to solve this conundrum.
Congress should consider a model that has been successfully
proven through our Nation's history, the Federal-State
partnership. America can adopt a 50-State climate strategy that
supports the vital role of States in cutting emissions, an
economy-wide system that allows for the differences between the
States.
Instead of attempting to sell all concerns about the
program's costs and impacts at the Federal level, Congress
could determine a national level of reductions needed to
achieve our climate goals and then divvy up the goals to the
States. State governments would then be empowered to execute
plans to reach those goals.
Successful Federal-State partnerships permeate our
environmental law, as well as many other areas of government
action. I would like to highlight five benefits, if you would
take this approach.
First, a Federal/State partnership approach would involve
all 50 States in America's pursuit of greenhouse gas
reductions, ending the current state of fragmentation. By
aligning all States toward common outcomes, overall U.S.
emissions could be reduced more quickly and businesses would
face more consistent framework across State boundaries,
boosting innovation.
Second, a Federal/State climate partnership promotes
regional fairness by tailoring action plans to each State's
circumstances and strengths.
Third, if any revenues are raised through climate programs,
the money would be kept circulating within the State's economy.
States can determine best how to use the revenue to reduce
emissions, prepare for climate change, and fairly distribute
the economic opportunities and costs.
Fourth, a Federal-State climate partnership may be
appealing to a wide range of States. States that are already
leading on climate change can continue on the paths they have
started. Other States get flexibility and Federal assistance to
develop and implement their own plans, or they can defer to a
simple Federal backstop plan.
Finally, a comprehensive Federal/State climate partnership
backed by new legislation in Congress can solve some of the
legal questions that arise without it. Many of our States hope
to pool their obligations under a plan by creating multi-State
programs. But it is unclear whether the Clean Air Act
authorities will allow such efforts. Such linkages could be
explicitly authorized under new legislation.
In summary, a comprehensive Federal/State partnership could
achieve fast and significant greenhouse gas reductions and
might just be able to overcome political stalemate with
cooperative solutions.
My written testimony presents a more detailed description
of this concept. I thank you for your time today, and I look
forward to answering your questions.
[The prepared statement of Mr. Profeta follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Tonko. Thank you, Mr. Profeta.
And I thank, again, our panelists for their input here this
morning, and thank you for what will be interesting dialogue.
Dr. Kaufman, I am of the belief that, if we continue to
invest in research and infrastructure, the cost of emissions
reductions will decrease significantly. But I see very high-
cost estimates, some over $1,000 per ton in two or three
decades, to achieve meaningful reductions in the transportation
sector.
Do you have any idea of how high a carbon price needs to be
set?
Dr. Kaufman. Thank you for the question.
How high the carbon price needs to be set depends on what
your goals are in terms of emissions outcomes, it depends on
what policies you are surrounding the carbon price with, and it
also depends on, you know, the assumptions you make about the
evolution of technologies, you know, gas and oil prices, and a
number of other factors.
What our research suggests is that, if you want to get on a
pathway, say, to the Paris commitments of the United States, a
carbon price alone of $25 to $35 a ton would be sufficient. If
you doubled those prices, you added in a bunch of complementary
policies with them, you could get on a much steeper emissions
reduction curve.
Some of these estimates that you describe that suggest
hundreds of dollars a ton, typically they assume that the
carbon price is doing all the work by itself as opposed to as a
part of a broader strategy, and they assume very little
advances in innovation. So harder-to-decarbonize sectors don't
get any easier over time. I think we can create policies that
overcome those challenges.
Mr. Tonko. And I think--and to your point, as we have seen
over the last 10 years, a lot of dynamics of change have
occurred, some beyond protected anticipation. So that is
encouraging.
What roles do a credible and steady price play to spur
innovation and ensure emissions reductions occur more cheaply
and quickly than currently estimated?
Dr. Kaufman. Well, we would expect a carbon price to spur
innovation in the private sector in a couple different ways.
So, first of all, by just, you know, encouraging a ton of
deployment in the near term in low-carbon solutions, we start
doing more of them, we get better at doing them, right? We have
seen that time and time again over the years. So that's one
source of innovation.
And then it also puts in place this price signal in the
long term that investors see. So they see if I create this low
carbon solution, the market share will be there when it is--
when it is created over time.
So, you know, a carbon price isn't sufficient by itself.
You still need government role in spurring innovation. But it
could be transformative.
Mr. Tonko. And with a goal of 100 percent clean by 2050, I
want to be sure our price signal is effective toward ultimate
goals. How should environmental certainty be included as part
of a carbon pricing program?
Dr. Kaufman. Well, I mean, the carbon--if you use a carbon
tax, for example, you know, you have control over the prices
and the cost, and you have less control over the emissions
outcomes.
So what you can do and what you see in a lot of the
proposals in Congress for carbon taxes are mechanisms that make
the tax rates contingent on the emissions outcomes.
All right. So, if we are seeing emissions fall the way you
would like to see them, the tax rate continues as originally
stipulated in the bill. If you are not seeing the emissions
directions that you want, the bill says that the tax rate can
increase even higher to achieve those reductions.
Mr. Tonko. And you talk about complementary policies. And I
believe almost everyone now agrees that carbon pricing does
require complementary policies.
What makes for a good complementary policy that advances
the goals of a price?
Dr. Kaufman. Well, you want policies that can lead to even
faster and cheaper emissions reductions than the carbon price
would achieve on its own. So I think there are a lot of
policies that fall into this category. You know, you can think
about innovation, which, you know, a lot of my friends here
were talking about. You can think about efficiency standards
where price signals alone aren't going to be sufficient. You
can think about infrastructure, especially in the
transportation sector. And also, if we are talking about
agriculture and land, you know, these might be areas that the
carbon price can't feasibly cover. So you absolutely want to
think about complementary policies in those areas also.
Mr. Tonko. And Dr. Gattie, DOE's loan program office has
issued a total of up to $12 billion in loan guarantees to
support the construction of the Vogel project.
Do you believe the Federal Government has and should
continue to play a constructive role in providing financing
assistance for innovative technology deployment?
Dr. Gattie. I do.
Mr. Tonko. Thank you.
And, Professor Esty, from your experience, can the public
sector help spur innovation in clean energy deployment by
providing access to capital and financing support?
Mr. Esty. Absolutely. And I think we have seen that with
the emergence of green banks. And, frankly, a model that is
using limited public money to leverage private capital, and I
think that has got to be part of the package that we put
forward to address climate change.
Mr. Tonko. Thank you very much.
And, again, I appreciate the panel appearing before the
subcommittee today.
The Chair now recognizes Representative Shimkus, our
subcommittee ranking member, for 5 minutes to ask questions.
Mr. Shimkus. Thank you, Mr. Chairman.
Mr. Profeta, is that your son behind you? Who is that young
man? What is his name?
Mr. Profeta. Duncan.
Mr. Shimkus. Hi, Duncan. Welcome to the hearing. We are
glad to have you here.
And this is a great panel. Thank you all. It gives a lot of
food for thought.
I am going focus on Dr. Gattie on my questions.
You state in your testimony that efforts to decarbonize the
U.S. economy will require investment. If the return on that
investment is a near-term reduction in U.S. carbon emissions,
the U.S. will remain vulnerable to climate change over the long
term as global emissions increase.
Would you like to expand on that?
Dr. Gattie. Yes. Thank you for your question,
Representative Shimkus.
The U.S. carbon emissions, if--as I pointed out in my
testimony, if we zeroed those emissions out, there is going to
be probably a cost associated with that. If the return on that
investment is only a reduction in U.S. emissions, and yet we
are still exposed to global carbon emissions--and again, my
point here is this is global climate change, it is not U.S.
climate change. As long as the source of the emissions remains
unchecked, we are still vulnerable to climate change impacts,
regardless of the domestic policy.
Mr. Shimkus. And I see some of your panelists shaking their
heads. And I would refer folks to your testimony and these
charts. They are just unbelievable, figure 4, 5, 6, 7, and 8.
And the last one, figure 9, it actually goes from 2000 to 2018,
showing 721 reduction in CO2 emissions per million
metric tons versus--that is the U.S., which is the greatest
reduction in CO2, without doing any of this stuff.
Now, you are a climate change believer, and you want us to
be engaged, and so I am not trying to spin a story that you are
in the denier category.
Dr. Gattie. No. I accept the science on climate change.
Mr. Shimkus. But your position is, if--we could be doing
all of this internal gymnastics for naught if we don't address
the Asian-Pacific region and all of these other ones that you
have highlighted.
Dr. Gattie. Correct. If we are disengaged from the global
community's efforts to reduce carbon, then we are not
addressing the cause and the source of those carbon emissions.
Mr. Shimkus. So how can we be engaged? So, accepting the
premise--we need to do that--how do we get engaged?
Mr. Soto. Paris.
Mr. Shimkus. No, Paris failed. So I hear rumblings by my
colleagues over here, and it is my time, and I appreciate that.
But you--in testimony today, Paris is not meeting its
agreements or its levels. So let's address the problem.
So how would you say we should be engaged?
Dr. Gattie. So I would start with--again, these emerging
economies, they want a couple of things, and Representative
Walden pointed it out. They want electricity. They need
electricity. They need reliable and affordable electricity. I
have heard testimony before this subcommittee before that those
emerging regions will do what is necessary to provide
electricity to their economies.
Mr. Shimkus. Regardless of the emissions?
Dr. Gattie. They will worry about the emissions later.
Mr. Shimkus. Correct.
Dr. Gattie. Unless they have a reliable substitute for
things like coal and natural gas, they are going to build coal
plants. The projections for coal plants--I think I may have
included that. We are still building coal plants throughout the
world.
Mr. Shimkus. Yes, sir.
Dr. Gattie. They are not--they are not going down. They are
increasing.
Mr. Shimkus. Let me turn to Mr. Profeta, because I see him
shaking his head on some of these answers, but also I want to
make sure that his son hears you get grilled in a question. No.
But you're agreeing to some of this. So can you give me
your analysis?
Mr. Profeta. First, I think the analysis is that it is a
global problem, and there needs to be a global solution. So we
need do need to be engaged in the international negotiations.
If Paris is not acceptable to you--it sounds like Paris
wasn't even aggressive enough to meet those targets. We need to
find a way that global emissions are going down.
But U.S. leadership is essential. Every time we have had
success in these international courts is because the U.S. has
come to the table and found ways, and the U.S. needs to be part
of this global solution.
The U.S. is not increasing at the pace of Asia, but it is
still about one-sixth of the problem. So we do need to show
some leadership there as well in our own domestic emissions if
we are going to be able to inspire our colleagues around the
world to act as well.
Mr. Shimkus. And, again, I do appreciate--the testimony has
been great. Thank you for being here.
And I yield back my time, Mr. Chairman.
Mr. Tonko. The gentleman yields back.
The Chair now recognizes Representative Peters for 5
minutes, please.
Mr. Peters. Thanks, Mr. Chairman.
Thanks to all of the witnesses for being here.
You know, Mr. Tonko is right: There is no silver bullet. I
was just jotting down all of the things we have to work on:
decarbonizing electricity, which Mr. Gattie addressed,
transportation, industry, buildings, agriculture, aviation. We
have to deal with the effects of wildfires, which Mr. Walden
has been avid on. We have to deal with short-lived climate
pollutants: methane, black carbon, hydrofluorocarbons, which
aren't necessarily going to be responsive to--with cheap gas to
these price signals by themselves.
We have to develop negative emissions technology, like
carbon capture, utilization, and sequestration, and we have to
deal with carbon price incentives. So this is a welcome
hearing. We have to deal with all of those things.
Mr. Shimkus is right, that this is an international
problem. And I would just say--and I don't mean to be rude, but
I just got back from Madrid. People meet on this every year.
And I was honored to go, but I will give my seat up to Mr.
Shimkus, because we all have to be involved in this. And being
the only country not there and saying that it is an
international problem just is too incongruous. We have to show
up. And this committee has been--this Congress has been
supportive of engaging in the Paris Agreement. We are the only
country not in it. So that is obvious to me, and I would love
to take you next year to----
Mr. Shimkus. But it wasn't bipartisan. It wasn't
bipartisan. We weren't invited.
Mr. Peters. No. Well, that's not true. Actually we----
Mr. Shimkus. No, we weren't invited.
Mr. Peters. Well, we can talk about that later, but--you
should have been invited if you weren't, but I believe you
were.
Second, Mr. Shimkus is right, that it should not just be
one party. And I hope that we will--if we are talking about
something as--on the scale of World War II or on the scale of
sending someone to the moon, that can't be a one-party thing.
So I hope that we will take this seriously. There is no
dispute about the science here. Everyone understands the target
is net neutrality by mid-century. I hope that we can count on
Republicans and Democrats to work together on this issue
because it really is an existential threat.
The one thing I would agree with Mr. Shimkus on, though, is
that there is no benefit economically to us. We know that, if
we don't do something about climate change, that the world GDP
will decrease by 30 percent and that the cost to the American
taxpayers directly will be billions of dollars by the end of
2020--'30s. That is from GAO.
So let's get to work on this. And I think that one of the
things we are--the thing you are talking about today, carbon
price incentives, is widely understood to be the backbone--the
backbone strategy for this.
Carbon tax--according to The Wall Street Journal's
assessment of 40 of the world's most esteemed economists,
carbon tax offers the most effective lever to reduce carbon
emissions at the scale and speed that is necessary.
I also would just state for my own purposes that you have
all come out with different views that--suggestions that I
think--I am open to any of them. I do think that, if it is true
that there are eight proposals before Congress now, and any of
them would reduce emissions in a dramatic way, as I think Dr.
Kaufman said, we should support the one that will pass.
And I am open to a cap-and-trade. That is what California
does. I think that we had some difficulties with that last
time. I am open to the clean-power-plant kind of structure that
Mr. Profeta was outlining. That wasn't as popular politically
as I thought it might be. I think, you know, if a carbon tax is
more directly effective, I think we should support that. And we
have Republicans who have cosponsored those two.
So, with the time left, I guess I would ask if maybe, Mr.
Esty, you might talk a little bit about how a carbon price is--
how fundamental design choices are made in the economy by a
carbon price. Just can you give us a little bit of explanation
for people who may not have been studying it as carefully as
you?
Mr. Esty. Sure. What a carbon price does is to make sure
that people are thinking about the fossil-fuel-emitting
activities they undertake and trying to reduce their emissions.
And I think it not only encourages every business, but every
family, every industry, to think hard about what they are doing
and to try to do things in new and different and better ways
from a point of view of decarbonization.
The other thing it does--and it was really central to my
suggestions to the committee here today--is that it spurs
innovation. It means that you have got many, many companies
that are out there thinking not only about how to reduce their
emissions but, frankly, how to reduce their customers'
emissions and to bring more low-cost technologies and products
to the marketplace.
So you set off a spirit of competition to be the best at
decarbonizing, and I think it really engages the private
sector. And I would say one of the great joys of America is how
good we are at innovation with the right policies to drive that
process.
Mr. Peters. Right. And so we talk about the polluter pays.
I mean, I think one of the things we really fail to understand
is that all of us are driving to work, all of us are driving
this--this pollution. We all need an incentive to understand
what those choices are, and price is the one that makes the
biggest difference.
And so I appreciate you being here, I appreciate all of the
testimony, and I look forward to working to land this plane.
And I yield back.
Mr. Tonko. The gentleman yields back.
The Chair now recognizes Mr. Carter from Georgia for 5
minutes, please.
Mr. Carter. Thank you, Mr. Chairman, and thank all of you
for being here. This is extremely important, and I appreciate
it very much.
Professor Gattie, it is good to see you always. Go, Dawgs.
I appreciate you being here. But--and I especially appreciate
your view, because I share the same view. I am not a climate
denier. I believe in climate change. I believe it is real. And
I believe we have to address it, and we have to address it on a
global scale.
And whenever we talk about that and whenever the panel--or
whenever the Members here have been asking questions, everybody
has been nodding yes. Everybody agrees with that. It is a
global problem. And I am not going to get into the Paris
Agreement and where we felt like we were having to carry too
much of the burden. That is not what I want to get into.
What I do want to get into, though, is that, Dr. Gattie,
what you said about the Asia-Pacific region, and specifically
what you said that we needed to triage where the problems are,
can you kind of elaborate on that for me a little bit?
Dr. Gattie. Thank you for your question. I tried to invoke
a medical term here.
Mr. Carter. And I appreciate that very much.
Dr. Gattie. Yes. It is a good two-syllable word, and it
works well. Sounds a little French, so I thought I would put it
in the----
Mr. Carter. That is the way we do it in the South.
Dr. Gattie. We try hard.
The point here is, if you are in a condition, and there are
patients, some are acutely sick, some are getting sick, some
are somewhat healing, where do you focus your efforts and your
resources? There are several approaches that you take. But you
certainly have to evaluate where you allocate your resources
and your efforts to have the maximum impact.
My point here with this approach does not disengage the
U.S. from engaging in climate solutions. We have to lean in. We
are responsible for leaning in. We should reduce our own
emissions.
My proposal here is we look at those regions of the world
where the problem is most acute, that we can deploy--develop
and deploy U.S. technologies--and we have all mentioned those
this morning, it is carbon capture and storage, it is advanced
nuclear reactors, small modulars, and on down the line--to
these countries that are going to burn fossil fuels with us or
without us. We need to have a strategy.
If the Paris Agreement had looked at it that way, as a
strategic triage effort, rather than a somewhat disaggregated
``everybody go home and do something individually,'' I think we
would have had a more ecological outcome than perhaps what we
are headed towards now, where we are not headed in the
direction that we need to go.
Mr. Carter. And I appreciate you saying that, because I
agree with you. I understand the United States should be the
leader, and that's why I tell people all the time I am excited
about the opportunities that exist here. The greatest
innovators, the greatest scientists in the world are right here
in the United States of America. We can solve this. I am
convinced of that, and I believe it can be a boom for our
economy because, if we can send the innovation overseas, I
think it would be tremendous for us. So I agree with that.
Now, I want to jump into it right now because, as everyone
knows, there are only two nuclear reactors under construction
right now. And they are Plant Vogtle in Georgia. So I want to
talk about nuclear energy and the role it plays because, you
know, when I talk to these groups and we mention nuclear
energy, they are, ``No, no, no, we can't do that.'' But nuclear
energy is, what, 55 percent of all of our clean energy right
now in America?
Dr. Gattie. Right, of the clean energy.
Mr. Carter. Right. So tell me about nuclear energy and tell
me, first of all, where you see that and the role it is playing
in future.
Dr. Gattie. So, again, thank you for question about
nuclear. This is the untapped resource that we are not focusing
on, in my opinion, at the level that we need to focus on. You
will see throughout my testimony, I emphasize the national
security implications of this. Nuclear is one of those rare,
unique energy resources that is not simply an energy commodity.
It, if left to market forces alone and the market forces
nuclear out of the market, that would be a national security
concern because we would be disengaged from the global nuclear
fuel cycle, the global nuclear ecosystem. That is not what our
original designers of nuclear power policy envisioned. We are
to be engaged and embedded and have other countries essentially
entangled in our nuclear culture. So it is an energy commodity,
but it is more nuanced than just the technology.
Mr. Carter. Great. Well, I am out of time, but, again,
thank you very much. And go, Dawgs.
Dr. Gattie. Yes, sir. Go, Dawgs. Let's hope they do.
Mr. Tonko. The gentleman yields back.
The Chair now recognizes the gentlelady from California,
Representative Barragan, for 5 minutes, please.
Ms. Barragan. Thank you.
It's critical for communities that are experiencing the
deepest effects of climate change to lead conversations on how
to mitigate its impacts, not just for one day on a panel, which
we had in November, but every day we are having this
conversation. This is important since the first page of our
briefing memo says that there is a large agreement among
climate policy experts that a price on carbon is needed to
reduce greenhouse gas emissions. However, I have received
repeated correspondence from environmental justice groups that
have real concerns with the carbon tax, absent concrete steps
to invest in frontline communities and stop the expansion of
fossil fuel infrastructure and extraction that harms
communities.
For my constituents, the climate crisis is also a public
health crisis. As we move forward, we must ensure all voices
are at the table as we weigh climate solutions.
I request unanimous consent to enter into the record a
letter to the Congressional Progressive Caucus from 33
environmental justice community civil rights and environmental
organizations opposing a carbon tax.
Mr. Tonko. Without objection, so ordered.
[The information appears at the conclusion of the hearing.]
Ms. Barragan. I also request unanimous consent to enter
into the record a letter sent to the House Select Committee on
Climate Crisis by over 250 environmental groups urging the
committee to reject policies that worsen inequalities and
prioritize support for communities harmed by the most--by
climate change and pollution.
Mr. Tonko. Without objection, so ordered.
[The information appears at the conclusion of the hearing.]
Mr. Shimkus. Chairman, can we--we are not going to object,
but we would like to see them, if we may.
Ms. Barragan. Sure. I will make them available.
Mr. Profeta, there are as many as 177 natural gas power
plants planned or under construction. If built, the emissions
from these plants will be locked in well beyond 2050. Which
policy would make more--which would be more effective at
preventing this: a carbon tax or a moratorium or new fossil
fuel power plants?
Mr. Profeta. Thank you for the question, Congresswoman.
I believe the obvious answer to your question is, if you
are looking for effectiveness not to have the plant built, to
ban the plants would be the more effective way to ensure it is
done rather than use market forces. The appeal of the market
force approach is that you don't pick or choose the technology.
You actually let the market find the lowest cost reduction.
I also would note that the proposal I brought forward on
sort of Federal/State partnership allows the State governments
to really look at some of the community affects you are most
concerned about within their States and design policies that
make sure they address the concerns of your constituents.
Ms. Barragan. Thank you.
Mr. Esty, it was recently reported by the EIA that U.S. oil
production reached a record of 12.4 million barrels per day,
making us the world's largest oil producer. I am fighting urban
oil drilling in my district that contributes to this total. How
can the U.S. reconcile being the world's largest oil producer
and decarbonize by 2050?
Mr. Esty. I think your question raises the opportunity to
put a price on the harm causing you have identified, and I
think that is one of the unifying themes that has come out of
the panel today, is that by making people pay for the harm they
cause, in particular by putting a carbon charge in place, you
begin to steer people towards other options, and I think this
is a very good solution for the kind of issues you are talking
about, not only from the point of view of carbon impacts,
climate change, but, frankly, for the public health issues as
well.
Ms. Barragan. Mr. Kaufman, do you--Dr. Kaufman, do you want
to chime in on this?
Dr. Kaufman. Well, I would agree with you that investing in
frontline communities is massively important and that there are
a lot of equity issues that policymakers should consider. I
would also encourage you not to lose sight of the first- and
second-order impacts of any strategy that you would put into
place to achieve net zero emissions by 2050, and that is going
to be massive reduction in not just carbon dioxide emissions
but local air pollution. So I think there are important issues
about how these benefits are distributed throughout the
population, but, you know, there are benefits for all there.
Ms. Barragan. Great. Thank you.
I yield back.
Mr. Tonko. The gentlelady yields back.
The Chair now recognizes Representative Long for 5 minutes,
please.
Mr. Long. Thank you, Mr. Chairman.
And, Dr. Gattie, our hearing today is the latest in a
series on how our committee could enact policies that will
reduce carbon emissions throughout the economy. We all agree
that reducing carbon emissions is an important goal to work
towards. And if anyone's ever visited China and Beijing, in
particular, and other cities in China where you literally
cannot see across the street, we know how important it is to
work towards that goal.
But I am wary of the potential economic and national
security impacts that broad-sweeping climate legislation will
have for everyday Americans. We have seen across the world how
well-intentioned governments are implementing policies to
reduce carbon emissions that have faced extreme backlash from
citizens. It has been mentioned several times here today when
these actions affect cost of goods and services which harm
economies and make countries less competitive in the global
marketplace.
The policies we work towards in this committee must reflect
the global nature of the climate change problem. Having
aggressive domestic climate solutions will not have an impact
on climate change if the rest of the world continues to
increase their own carbon emissions. Action this committee
takes needs to serve as a blueprint for the rest of the world,
showing how our climate policies that don't hinder economic
growth and threaten national security are attainable and the
right way to combat global problems like climate change.
Dr. Gattie, I am a proponent of nuclear power as a producer
of clean and consistent carbon-free emissions, and I'd like to
say that I recently visited Fukushima, and I am cochair of the
congressional study group on Japan with my buddy, Diana
DeGette, on the other side of the aisle, and they have gone
through some times with that, of course, and with trying to get
back to nuclear energy, which, you know, with their locale
where they are located, it is pretty much mandatory.
And it is disheartening that the rhetoric from some of the
Presidential candidates running right now shows a desire to
eliminate our most reliable clean energy source. Nuclear power
can and should be further utilized in America, but the
potential for exporting nuclear technology in developing
countries can produce a path forward to significant carbon
reductions.
Can you expand on the importance of building durable energy
technology relationships and how exporting nuclear technology
can help the United States accomplish larger goals of combating
climate change?
Dr. Gattie. Yes, sir. Thank you for your question.
Energy is essentially the language of geopolitics. Energy
relationships are what underpin much of our 21st century, just,
economic flows. Those relationships are going to occur
globally. Right now, countries such as Russia and China are
building out those infrastructures. China is using their Belt
and Road Initiative. And, of course, Russia is looking to build
gas pipelines. They just, I think, connected one. It's the
Power of Siberia to China.
Those are anchors for long-term geopolitical relationships.
When it comes to nuclear, in particular nuclear, that is an 80-
year relationship. Whoever is the country developing the
technology in those developing regions will be there for 80
years or longer. They have the opportunity to then impress upon
that region their own cultural norms and standards. They don't
necessarily share our American values. If they are
authoritarian countries, they are not in it for only the long-
term relation. They are in it for dominance. They are in it for
the influence. They have a plan. Russia and China, in
particular, with their nuclear and Russia with its gas, they
have a strategy, and it is a long-term strategy, and energy
underpins that.
We should be responding to give those countries options,
the options that our early policymakers directed nuclear policy
for the very intention of the U.S. being that provider of that
nuclear power. The national security aspects are the
overarching objectives for all the things you just mentioned,
Representative Long. Climate change is embedded in that. It
just happens to be one of the benefits of nuclear, but still
the national security part is the overarching objective.
Mr. Long. You covered several of the things I was going to
point out as which is China's hundred projects that are either
planned or proposed or everything. So I am out of time. So I
appreciate all of you being here today.
And I yield back.
Mr. Tonko. The gentleman yields back.
The Chair now recognizes the gentlelady from Delaware,
Representative Blunt Rochester, for 5 minutes, please.
Ms. Blunt Rochester. Thank you, Mr. Chairman.
And thank you for your continued leadership in building a
100 percent clean economy. I also would like to thank Mr.
Shimkus, our ranking member, and to the witnesses.
One of the things--if anybody is watching this hearing, I
hope the big takeaway that they have is something that my
colleague, Mr. Carter, talked about, which is the agreement
that we have that, number one, climate change is real, that we
must address it on a global level, and that the United States
must be a leader. If you leave with nothing else, there is
agreement on that. And ultimately, we do this for our health.
We do this for our security. We do this for our economy, and
the goal is to do it in a just way. So be encouraged by that.
Part of the process here is to come up with solutions, and
this is a solution, some solutions, and I wanted to just share
that, before coming to Congress, I had the opportunity to serve
in State government in Delaware. And at the State level,
partnerships were pivotal. It was just pivotal. So I am really
interested in the State/Federal partnership idea to address the
climate crisis. And, particularly with Delaware being a leader
in fighting climate change, I am proud to say that Delaware is
a member of both the Regional Greenhouse Gas Initiative, also
known as RGGI, and the U.S. Climate Alliance, and this year in
particular we have seen unprecedented climate action at the
State level. I want to make sure that we protect and build on
that great work that is being done.
So my question is to you, Mr. Profeta. How can we ensure
that a State/Federal partnership builds on the successes of
programs like RGGI, rather than duplicating or undermining
them?
Mr. Profeta. Thank you, Congresswoman, for the questions.
I think that is the beauty of the idea, is that there is so
much activity on the State level. The States have developed
such leadership on the issue. There is no reason to halt that
but actually use that momentum and keep it going forward with
sort of a Federal/State partnership. So what the Federal role
would be, would be to create a 50-State solution to make sure
all States have objectives and goals set by the Federal
Government so there is no patchwork between them.
And States like Delaware, States like the RGGI States,
could continue their program and be--the one key would be to
look at what the leadership States have done, or all the States
have done, what has been working, and make sure your
legislation authorizes that to continue and accelerate.
Ms. Blunt Rochester. Great. Thank you.
And, thanks to programs like RGGI, emissions are decreasing
in the Northeast. But at the same time, they are increasing in
other parts of the country, possibly even offsetting other
regions' gains. Can you explain why States' emissions are going
in such directions and how a State/Federal partnership can
counteract that?
Mr. Profeta. Well, it is kind of like a balloon. You push
down one place, it may come up another place. The emissions can
leak to other regions of the country. And this is tradition
across a lot of our statutes, but what the Federal Government
can do is set objectives that kind of create a level playing
field and make sure everybody is moving in the right direction
but allow the States to design plans that work for their
constituencies, their needs and transitions. So, you know, the
Federal Government will create the standards to make sure
everybody is going the right direction, but the States will
have the discretion to take it there.
Ms. Blunt Rochester. And then I just want to close by
piggybacking on Ms. Barragan's questions that we know
communities of color, as well as low-income communities, are
disproportionately burdened with pollution. And at the same
time, these communities tend to spend more of their income for
power and heat their homes, while lacking the resources and
information to take advantage of solutions like energy
efficiency and solar. Some of the traditional ideas for how to
decarbonize fail to account for these inequities, and for that
reason a comprehensive climate strategy with economy-wide
solutions must ensure that these frontline communities are
heard, protected, and prioritized.
In the time that we have, maybe Dr. Kaufman and Mr. Esty,
if you can each discuss how we can go about protecting low-
income households and other impacted communities and how smart
policy design can ensure these protections.
And we only have 30 seconds.
Mr. Esty. I will start for 10, and then we will let--I
think what you have is the opportunity to spend the revenue
that comes from a carbon charge in ways that address the
inequities, and I think attending to the communities that are
disadvantaged is a starting point, but I would also look at the
communities most affected by the transition. So I think a smart
transition is critical.
Ms. Blunt Rochester. Mr. Kaufman, 10 seconds.
Dr. Kaufman. Well, let me just agree and say I mentioned in
my testimony making sure those who can't afford higher prices
don't have to pay them. Making sure that coal communities, in
particular, who would be adversely affected by the policy would
be very smart uses of revenue. I think the frontline
communities issue is potentially a separate policy objective
but no less important.
Ms. Blunt Rochester. I know my time has run out, but I
think that is also an area where we can find common ground,
that we also have to take care of vulnerable communities that
also are impacted by what we do here. So thank you so much.
And I yield back.
Mr. Tonko. The gentlelady yields back.
The Chair now recognizes the gentleman from South Carolina,
Mr. Duncan, please, for 5 minutes.
Mr. Duncan. Thank you.
Thank you, gentlemen, for being here.
I want to begin by commending the Trump administration and
the energy sector for the robust domestic energy production we
are seeing now. There is no doubt that energy--American energy
renaissance has strengthened our leadership on the world stage.
The failure to seize the abundance of our resources has
international implications. In fact, a couple of weeks ago
Fiona Hill testified in front of the House Intelligence
Committee that Vladimir Putin saw American fracking as a great
threat to Russian interests and that a fracking ban would play
into strengthening Putin's hands.
Energy is used as a political weapon by many of our
adversaries. We have the opportunity and arguably the moral
obligation to export U.S. energy to energy-poor countries
around the world to help them reduce their dependence on
corrupt state-owned regimes like Vladimir Putin. We have the
ability to increase the quality of life for so many people
around the world.
If we truly care about the lives of people around the world
and impoverished regions, American energy export can help
improve their lives by providing electricity to areas that
don't have that so they no longer have to cook over wood or
coal or dung or whatever substance they use to heat in their
homes, cook over, they have the ability with electricity to
keep food fresh for longer periods of time, the air quality is
much better, the possibility of air conditioning, the
possibility of reading to their children at night. But yet the
policies I hear put forth and the ideas put forth today would
increase electricity costs for American citizens.
And who is hit worse by those costs? And that is the poor
folks in our economy because higher electricity fees would eat
up more of their already limited income, but yet you want to
tax the energy production. You want to tax the manufacturing in
this country and redistribute that wealth to help--I think Mr.
Kaufman said--help those so they don't have to pay the
electricity costs, the higher costs. That is just
redistribution theology, and it doesn't work.
One added benefit, that our export LNG may be cleaner than
that that those nations would use otherwise. So climate
benefits are connected directly to the energy diplomacy
efforts. But what would we do this in this country? We are
pushed to sign on to a Paris climate accord. But we're not
holding India, China, and Russia accountable for their air
quality emissions.
How about this? Instead of stopping pipelines and LNG
export terminals on the West Coast, why not support those so
that cleaner-burning, affordable, American-produced natural gas
can be exported to areas like India or Southeast Asia or
possibly China to help them lower their air-quality emission
while supporting a robust American energy economy?
A carbon tax, as you have proposed in your testimony, of a
more drastic--a ban on fracking that some have proposed would
completely reverse the trajectory of American energy
renaissance. American companies would be less inclined to
innovate. Costs would undoubtedly go up for consumers across
the economy.
So, Dr. Gattie, we talked a lot about the role of natural
gas and our changing generation mix, but we always don't give
credit where it is due. Do you agree that our emissions
reductions are made possible by hydraulic fracturing and
advances in the technology?
Dr. Gattie. In the power sector, yes, sir.
Mr. Duncan. Can you talk a little bit about nuclear power
and how that figures into the energy matrix and lowering our
carbon footprint?
Because, Mr. Esty, you are from Connecticut? Is that
correct?
Mr. Esty. [Nonverbal response.]
Mr. Duncan. Your Governor just decided not to decommission
reactors and keep them online. Why? His own words were, ``We
can meet our attainment levels. We can meet our lower carbon
footprint by keeping nuclear in the mix.'' There is a byproduct
on nuclear power, and that is nuclear waste that needs to go to
a long-term stable storage facility. This committee has talked
about Yucca Mountain. I am not going to go there today, but I
support that as a long-term storage facility.
Dr. Gattie, can you talk about nuclear power and how it
plays into that, into the lowering-carbon-footprint matrix?
Dr. Gattie. The way I look at nuclear, it is a long-term
investment. It is a long game. It is very different than the
way a lot of the markets work now, where markets are trending
towards short-term, marginal profits, looking at natural gas,
which I am a natural gas supporter. It has gotten us to where
we are in the power sector.
I agree with your point that I would like to see us
exporting that LNG to countries where other countries are
building pipelines to connect them with their countries, but
the nuclear is the long game. We are looking at long-term
carbon hedging here for eventually if there is a carbon
processor or anything. This is a long game.
Mr. Duncan. I am out of time.
But would you agree that Russia and China and India--Russia
and China primarily--are exceeding the United States in nuclear
technology and development at this point?
Dr. Gattie. Russia and China are. I wouldn't necessarily
say India is, but they are on--they have strategies that we
currently lack.
Mr. Duncan. Yes.
Thank you, Mr. Chairman. I yield back. I appreciate it.
Mr. Tonko. The gentleman yields back.
The Chair now recognizes the gentleman from Florida, Mr.
Soto, for 5 minutes, please.
Mr. Soto. Thank you, Mr. Chairman.
You know, we define American excellence and leadership in
climate here in Congress, not by the terrible energy policies
of China and India. So I for one won't be using them as a
benchmark, but the fact that we need to lead. And we are here
because we have our 100 Percent Clean Economy Act to get us to
net-neutral carbon output by 2050, and it is an all-of-the-
above strategy that includes wind and solar but also includes
nuclear and potentially carbon capture.
But I want to focus not on just the cost of action, which
we will go into in a little bit, but the cost of inaction.
Through 2014 to 2018, we spent $13 billion a year annually on
disaster relief, including in my home State of Florida. Three
of the past 6 years, we set records in disaster relief
spending, and that is not even getting into the health costs
that are facing so many communities of color like where I
represent, and then I am forced to go back to a State where we
see headlines in Florida today: ``Climate Change Once Flooded
Florida--And It Could Again,'' WLRN.org; ``Florida Keys Deliver
a Hard Message. As Seas Rise, Some Places Can't Be Saved,'' New
York Times just today.
But, if saving the planet for our children and our
grandchildren isn't enough, how about 21st century economic
dominance? If we have the clean energy revolution here with our
partners in Europe, we will dominate the 21st Century economy.
I just want to ask a basic question to Mr. Kaufman. If we
developed advanced clean energy technology, do you think China,
India, and Russia would buy it?
Dr. Kaufman. If the technology is good, I think they would
buy it. I think what my sense is that we have been innovating
in energy, you know, for decades, for centuries, and what we
have seen is that innovation is important, but it doesn't in
itself cause us to use less of anything, right? We use more
biomass now than we used to. We use more coal than we used to,
even though we are developing these new technologies. So I
certainly appreciate the points that we need to develop new
technologies. But I think, if we think that will lead to
reduced emissions by itself, then I think we are kidding
ourselves.
Mr. Soto. Certainly, which is why we have an all-of-the-
above strategy, and thank you for that comment.
You know, this comes down to basic property law. You learn
it in Property 101: tragedy of the commons. Those of you who
are lawyers in the room know that wonderful story. It started
back in England and beforehand where people would pollute the
commons. It would get worse and worse. There would be health
problems. You would have economic collapse unless you regulate
the commons. And now we are dealing with the whole world,
because every ton of carbon that is put in the air is polluting
and destroying our planet.
And so, you know, I would like to think that we Democrats
are the party of free market, much like our colleagues across
the aisle, which is why we are here today, to discuss free
market solutions.
I would like to get a show of hands. How many of you would
support a cap-and-trade regime to help lower carbon emissions?
Raise your hand.
Mr. Esty. Can we ask whether that is our choice?
Mr. Soto. I am going to go into other things. I am going to
go into carbon tax next. So we have one, two, three.
How many of you would support a carbon tax as a regime to
lower energy costs? OK. Let's focus on carbon tax because it
seems like one that most of you have pushed more than others.
It would be great to hear from all three of you who raised your
hands. What do you believe the cost of carbon should be set at
per ton?
Mr. Esty.
Mr. Esty. I would start with $5 per ton and escalate by $5
per ton per year for 20 years for a $100-a-ton end price.
Mr. Soto. Thank you.
Dr. Kaufman, what is the price of carbon per ton to our
planet?
Dr. Kaufman. I think if we are in the realm of starting
above, you know, the $20, $30 a ton, it is whatever bill that
you can pass in Congress.
Mr. Soto. Mr. Profeta, what do you think it should be?
Mr. Profeta. I raised my hand for other things. So I think
you do whatever you can to get expeditious reductions in
greenhouse gases.
I would second Noah's standpoint. What is politically
feasible in that range that would make--move the needle?
Mr. Soto. OK. Thank you.
And, lastly, you know, we are cognizant of the fact there
are energy-producing States that would suffer economically as
these things happen and that this funding should also be used
to help invest into new industries like transitioning to
renewable energy equipment manufacturing, building nuclear
power plants in some of these areas that will be producing less
coal or oil or gas and even establishing wind where
appropriate.
I wanted to ask a basic question to Mr. Esty. Do you think
we have the ability to transition those economies over to these
more renewable energy and nuclear energy opportunities?
Mr. Esty. Absolutely. I think there is a clear possibility
of reinvesting some of the revenue generated by an economy-wide
carbon charge and put that into the communities that need to
transition.
Mr. Soto. Thank you.
I yield back.
Mr. Tonko. The gentleman yields back.
The Chair now recognizes the gentleman from Ohio, Mr.
Johnson, Representative Johnson. You have 5 minutes, please.
Mr. Johnson. Thank you very much, Mr. Chairman.
And, Professor Gattie, you know, last Congress this
committee discussed the important role that Part 810 plays in
U.S. civil nuclear providers' ability to engage with our
international allies. During this debate, we heard some
concerns that went along the lines of, you know, it is too
dangerous for the U.S. to engage in these international
markets, therefore Russia, China, and others should take the
lead in that engagement while we sit on the sidelines. For
crying out loud--and I have heard Secretary Perry even talk
about this--we cannot sit on the sidelines on the commercial
nuclear arena because, once China and Russia get their foot in
the door with developing countries in putting in commercial
nuclear programs, they are in there for, like, a hundred years.
I mean, it is a big influence that they wield.
So, in your testimony, you discuss how early U.S. nuclear
policymakers recognized the strategic importance of America's
nuclear enterprise. So here is my question: What steps can
Congress and those within the nuclear industry take to stress
the importance of America's international engagement today?
Dr. Gattie. Thank you, Congressman, for that question.
I will propose two general high-altitude--the first one is
political, and that is I would encourage the committee to maybe
go back and look at the 1956 platforms for both Democrats and
Republicans. Both were competing to be the champion for the
U.S. Nuclear Enterprise to be the world's premier nuclear base.
I would like to see that brought down to the public's purview
for the general public to understand that we have managed this
for 70 years and can continue.
Now moving forward, on the broader policy side, a
suggestion as to how do we develop a strategy long term. To the
point you made, Congressman, China and Russia have strategies.
They are state-owned enterprises, serve as extensions of the
state. One analog here is the way DoD kind of looks at its
supply chain and manufacturing supply chain. Every few years,
they do an industrial-based review. They look at what we need
to do to ensure that our defense base and our manufacturing
base for the defense is where it needs to be.
I think a similar approach could be taken for our nuclear
sector. It is a critical industry. It is a national security
industry. I think we should at least, to get our brains wrapped
around what our gut is telling us about this national security
thing, we really need to do an evaluation or assessment similar
to that to look at our manufacturing supply chain and our
current status for U.S. nuclear enterprise. I think that is
something this committee and Congress can engage in and get
multiple Federal authorities engaged. It would be the
intelligence community, the State Department, the Commerce
Department to do a thorough review of where we are, where we
are compared with other countries, and what is the strategy for
moving forward.
Mr. Johnson. Yes, I think it is really important. And I
agree with you. We have got to get it into the purview of the
American people. It has got to be a conversation on the street.
And the reason why is because, in countries like China and
Russia, public opinion doesn't mean anything to the
decisionmakers in those countries. They don't have the system
that we have that demands input from the American people and we
lawmakers that have to take into consideration the concerns of
our people, the people that sent us here to represent them. It
puts us at a disadvantage in terms of tactical moves in that
sphere. So I agree with you.
How can we ensure that we are appropriately balancing
safety and security within our nuclear export policies while
ensuring our domestic industry can successfully compete in
these international markets?
Dr. Gattie. So, again, there, Congressman, I would go back
to my earlier point about doing a base-level industrial review
of our entire nuclear sector. Where do we stand on the supply
chain? Where do we stand on our fuel purchases? Where are the
bottlenecks and constraints currently where we can and cannot
purchase fuels? Are we constrained at any point in that supply
chain? I am not sure that we comprehensively understand exactly
where we are. I think that is something that should be driven
by some congressional----
Mr. Johnson. Do we have the right balance between
engagement and security? Do you think that--because, I mean, I
don't. Obviously, I don't.
Dr. Gattie. No, sir. No, sir.
Mr. Johnson. OK. All right.
Mr. Chairman, I yield back.
Mr. Tonko. The gentleman yields back.
The Chair now recognizes the gentlelady from Colorado,
Representative DeGette, for 5 minutes, please.
Ms. DeGette. Thank you so much, Mr. Chairman.
I have been a member of the Energy and Commerce Committee
for many, many years. And I actually sat in on the hearings
where my colleagues on the other side of the aisle, despite
overwhelming evidence to the contrary, denied that climate
change existed. So I am actually really pleased to see that we
have moved now into the realm where everybody agrees that
climate change exists and that we need to have a solution, but
I am, frankly, very concerned by this implication that, since
it is an international problem and since China, India, and
other countries--Russia--are not complying, that we should
somehow just sit around because I don't know of any time in our
Nation's history where we actually sat around waiting for
China, India, and Russia to do something.
And so that is why I have been developing legislation. I
have been trying to find a bipartisan cosponsor of this
legislation that would be a market-based solution, that would
help U.S. interests, that would get us to the standards of zero
percent carbon emissions by 2050, and that would be an all-of-
the-above solutions, so long as they met those standards.
So I want to ask some questions about how a bill like
that--which would basically decarbonize electricity and then
move towards electrification of everything--how that would help
us with this international issue and with the U.S. standards in
the international community. Rather than sitting back and
waiting for them to do something, let's be the leader and let's
benefit economically from it.
So, Dr. Kaufman, I want to start with you. If we put a
price on carbon pollution, can that drive innovation in
technologies that don't emit carbon?
Dr. Kaufman. It will, yes.
Ms. DeGette. OK. And do you know exactly what technologies
can get us to zero emissions, or do you think we are going have
to have innovations along the way in the next 30 years?
Dr. Kaufman. Well, innovation will enable decarbonization
to proceed more cost effectively, faster. It is----
Ms. DeGette. Right. But we don't know exactly what that
technology is right now, do we?
Mr. Esty, you are shaking your head no.
Mr. Esty. I agree with you. What we really want to do is
incentivize technology breakthroughs across the board.
Ms. DeGette. Right.
Mr. Esty. And so that is where the carbon price allows you
to get all of those different players, because we don't know
whether it would be wind----
Ms. DeGette. Right.
Mr. Esty [continuing]. Or solar or biofuels or tidal power
or wave power or anything perhaps not even known.
Ms. DeGette. Right. I mean, you know, my provider, Xcel
Energy, they set a zero percent goal by 2050, and they told me,
``Frankly, we don't know how we are going get there, but we are
going innovate, and we are going to get there.''
So I want to ask the two of you, Mr. Esty and Dr. Kaufman,
if we do develop those technologies--Mr. Soto asked a little
bit about this--is that going to help us be able to then export
our technologies around the world and help them also reduce
their carbon imprint?
Mr. Esty. Well, I would argue that the U.S. has always been
very good at innovation and that has been the key to our
competitiveness over time, and it is quite clear the world is
pivoted towards a decarbonized future, and I think we would
want to be out front in helping to deliver those solutions not
only domestically but internationally.
Ms. DeGette. And it would help our economy, right?
Mr. Esty. Absolutely.
Ms. DeGette. Now, Mr. Profeta, I want to ask you quickly.
You talk about building a program State by State, and I really
agree with that. I think every State has their own history in
advancing clean industry. In Colorado, I talked about Xcel and
what they did. And everybody has their own unique starting
points.
So, if I understand correctly, your overarching principles
are: The pace of progress needs to be proportional to the scale
of the problem so that the goals are going to be ambitious; the
policy approach needs to be doable, by which you mean
bipartisan; and we need to respect the different starting
points around the country across different sectors and even
within different sectors.
Is that an accurate summary of your views?
Mr. Profeta. That is really well-boiled-down stated
principles, yes.
Ms. DeGette. OK. Now, as we create an economy-wide program
step by step--which, as you say, can be done in a number of
ways--how do we avoid doing that in a patchwork way? How do we
have an overall arching solution?
Mr. Profeta. There are two versions of patchwork. One is
you have some who are acting, some who don't. So you have sort
of leakage into the nonacting State. A 50-State strategy solves
that. The second is you have different regulatory regimes in
different States, and you may evolve some differences as the
State laboratories work, but you can write your legislation to
incentivize States to work together, to have all the
authorities they need to merge sectors, merge programs, where
it's efficient for them to do so.
Ms. DeGette. You mentioned other laws: the Safe Drinking
Water Act, Clean Air Act. A lot of laws we have done that way.
Is that right?
Mr. Profeta. Exactly. If you look at the Clean Air Act and
what we did on the interstate pollution across the Northeast
and Midwest, we wrote model rules in programs that would allow
the States to work collectively together.
Ms. DeGette. Thank you. Thank you very much to all of you.
Mr. Tonko. The gentlelady yields back.
The Chair now recognizes the gentlelady from the State of
Washington, Representative Rodgers for 5 minutes, please.
Mrs. Rodgers. All right. Very good. Thank you, Mr.
Chairman.
And today we are considering policies to achieve economy-
wide deep decarbonization. Judging from the majority's memo,
their proposals seem limited to policies that tax our economy
and industrial sectors out of existence and destroy America's
global competitiveness and leadership.
In Washington State, people have resoundingly rejected two
separate carbon tax initiatives because a tax would put us at a
competitive disadvantage. A Federal carbon tax or cap-and-trade
would do the same to America on the global level without
allowing to us continue to lead in reducing carbon emissions.
Climate change is a global issue, not just an American
issue. It requires a global solution centered around
innovation, which has made the United States so successful at
reducing emissions. As we look to decrease emissions without
destroying our economy, it is crucial that we expand our
nuclear energy portfolio. American companies like TerraPower in
Bellevue, Washington, have led the world in nuclear technology
and innovation, but regulatory restrictions have hurt their
ability to deploy new reactors both at home and abroad.
Right now, China and Russia are developing and exporting
small modular reactors to underdeveloped countries, expanding
their global influence. For America to win the future, we
cannot afford to sit and allow this to continue.
Professor Gattie, in your testimony, you mention early
efforts by American policymakers to use America's nuclear
energy enterprise strategically around the world. In your
opinion, what caused the move away from these policies, and how
has that affected our national security and global
competitiveness with China and Russia?
Dr. Gattie. Thank you for the question.
I think over time there were a few things that contributed
to it. I think we got complacent, for one thing. I think we
just simply--back in the eighties and nineties, we got
complacent in the power sector. I think recently maybe we have
gotten a little overconfident in our natural gas market. We are
very--lots of confidence right now that we have got an abundant
supply of natural gas. Of course, what we know is those are--
those have end games to them.
I think there is also a good bit of, we have had market
deregulation throughout the country. I think that has
contributed to some of the current nuclear fleet being
threatened for early closure. There is also just a general fear
of waste and proliferation, things that we have always been
able to manage here in the U.S. and globally for decades. But
maybe one of the underlying reasons, Congresswoman, is that I
really believe that we have got a general disconnect--and I am
saying this in reflection of students that I teach. There is a
general disconnect of where we are globally right now, what the
21st century is actually like, what our competitors are now
compared to what they were in the 20th century.
Russia looks ham-fisted, the USSR does, compared with what
China is now. They have a long-game strategy. And nuclear is
dead center in that, a long-game strategy to develop advanced
reactors, close the nuclear fuel cycle, and implant their
nuclear culture in other countries.
President Xi Jinping, he makes no bones about it that it is
socialism with Chinese characteristics. And if the U.S. does
not step up and respond, it is going to give the world the
impression that socialism with Chinese characteristics is
succeeding where capitalism with American characteristics is
failing.
This is something--it is a sad state of affairs when
President Eisenhower's ``Atoms for Peace'' vision is being
forwarded by China and Russia and not us. That is--he would
roll over in his grave.
Mrs. Rodgers. Thank you.
So let's talk about, how do we make up the ground? So, in
terms of policies to reduce emissions, how would we benefit
from Federal policies to demonstrate technologies like advanced
nuclear? Is it a problem that the Department of Energy does not
currently have a demonstration project for a nuclear technology
such as been proposed in the Nuclear Energy Leadership Act?
Dr. Gattie. I think things like NELA, the Nuclear Energy
Leadership Act, are good touchstones. I think the overarching
concern here is we don't have a strategy for those things to
map into. We don't have a long-game purview and vision of what
we want our nuclear enterprise to be in the 21st century for
30, 40, and 50 years.
I wish we would stop rejoicing too much in small victories
and look at the big picture and setting ourselves up again to
be the world's dominant--not a level playing field with China--
the dominant nuclear provider in the world.
Mrs. Rodgers. Thank you. Thank you for being here.
And I will yield back.
Mr. Tonko. The gentlelady yields back.
The Chair now recognizes the gentlelady from Stanville,
Illinois, Representative Schakowsky, for 5 minutes, please.
Ms. Schakowsky. We are in the midst of an existential
crisis right now. Last month, over 11,000 scientists from
across the globe issued a warning of, quote, ``untold
suffering,'' unquote--quote/unquote--that will be caused by
climate change. The warning stated that, quote, ``scientists
have a moral obligation to clearly warn humanity of any
catastrophe, catastrophic threat, and to tell it like it is. We
declare clearly and unequivocally that planet Earth is facing a
climate emergency,'' end of quote.
While the President ignores the emergency, my State of
Illinois--you have talked somewhat about States--is leading the
way on climate solutions thanks to the work of Governor
Pritzker and our House and Senate. During his first week in
office, the Governor signed an executive order to join the U.S.
Climate Alliance. And since then, the Governor has signed bills
that will boost wind energy development in the State and
protect communities from coal ash and other pollutants and
champion a plan that invests $140 million for renewable energy
projects across Illinois.
So, Mr. Profeta, what can--or maybe the question should be,
can the Federal Government right now learn from States like
Illinois?
Mr. Profeta. Yes. In fact, we do work with the State of
Illinois and some of the projects we worked at Duke University,
and I have been very happy to be engaged with the efforts
there.
Illinois is a good example. It is part of--Chicago is part
of the PNJ region, too, which is the electricity grid region,
and so it is looking to both take its own actions and figure
out how in the electricity market it can make sure that its
emissions are not only--reductions are not only secured in
Illinois but across the region, and that is where the Federal
Government could help by giving all the States goals and
objectives so that they are sort of holding each other to the
same standard.
Ms. Schakowsky. Mr. Esty, your statement describes the
importance of innovation including the need for, quote,
``innovation in policy design.'' Some of my colleagues like to
say that, quote, ``innovation is the key to addressing climate
change,'' but they stop short of calling for policies to
actually spur innovation.
So, Mr. Esty and maybe Mr. Profeta as well, or Dr. Kaufman,
talking about if you would agree that innovation doesn't just
happen on its own and that it requires strong policy signals to
set the Federal level.
Mr. Esty. So I would just say--and I think it has been a
consensus today--that you want a portfolio of policies to drive
clean energy and to create incentives for the innovation that
we all are counting upon.
Mr. Profeta. Yes, I would like to say, yes, you know, the
United States is probably one of the greatest engines of
innovation in the history of the world. And our capitalist
system has really driven people. When they can make money
innovating, they tend to do it. So, if we can create policies,
however we do it, that drive the innovative engine, this
Nation, towards those things, we will end up driving the
world's transition in the energy system, and that would be
across the whole portfolio.
The one thing that is really distinctive, I think, on this
panel that I want to make sure and note is every one of the
four of us thinks that nuclear power is probably part of the
solution set. So it is not something that where I think any of
us think that nuclear isn't a significant part of the solution.
A good----
Ms. Schakowsky. Let me confirm that. Is that the case? OK.
I know that----
Mr. Profeta. I mean, the chairman said at the outset there
is no silver bullet for climate change. It is really silver
buckshot. You just have to, like, spray the incentive across
the economy and harvest every solution you can possibly have
that doesn't make greenhouse gases.
Ms. Schakowsky. So I want to get do this question of
urgency. I spent a lot of time with constituents, especially
young constituents who are walking out of classrooms on Friday,
trying to come here and create this sense of urgency. Thousands
of experts are warning that climate change could mark actually
kind of a dead end for humanity.
I am just trying to get from--well, I guess we are done. I
have said my sense of urgency, but I really think that that has
to be such a big part of the conversation here, that we have to
move and we have to move now and the kids that come to me say,
``Don't talk to me about my bright future. I might not have a
future if you don't act.''
Mr. Tonko. The gentlelady yields back.
The Chair now recognizes the gentlelady from California,
Representative Matsui, for 5 minutes, please.
Ms. Matsui. Thank you, Mr. Chairman. I will thank the panel
for being with us today.
Over the past 6 months this committee has been focusing on
a number of hearings to examine what it will take to achieve
100 percent net zero emissions by 2050, a necessary goal if we
are to safeguard our planet and future generations from the
devastating effects of climate change.
A central policy to this goal is the idea of some sort of
economy-wide price on carbon. This has already taken place in
the EU and parts of Canada and here at home in my home State of
California, as well as grouping of nine Northeastern and mid-
Atlantic States, signifying clear support for such initiative.
California's cap-and-trade program, which has been in place
since 2014, has demonstrated dual benefits of reducing
emissions through its mandated caps but also by raising revenue
through the quarterly allocation auctions, which can fund
additional emissions reduction and climate mitigation efforts.
Mr. Profeta, you mentioned in your testimony this idea of a
Federal/State climate partnership in which the Federal
Government sets a national level of reductions and States
implement unique plans to achieve this.
Additionally, Canada established a Federal carbon pricing
mechanism that allows provinces and territories the flexibility
to develop their own carbon pricing system. The policy allows
provinces whose carbon prices meet the Federal standards to
maintain their existing mechanisms.
Mr. Profeta, do you think a U.S. carbon pricing system
should be structured in a way that provides States the
authority and flexibility to develop their own market-based
carbon pricing strategies and allows States that have already
established carbon pricing mechanisms, like my home State of
California, to maintain their existing programs?
Mr. Profeta. Yes, I think the concept that we have been
discussing developing would allow the States to determine
whatever approach they want to meet the carbon goals, including
the preexisting programs.
Ms. Matsui. OK. As I mentioned, California's cap-and-trade
policy has delivered the additional benefit of bringing in
millions of dollars of revenue that can go towards additional
efforts such as investments in cleaner transportation, energy
efficiency upgrades, and reducing air toxics and criteria
pollutants. The first year of auctions alone generated more
than $525 million in revenue for the State, and to date 11.8
billion has been generated and deposited into a fund that is
used to reduce greenhouse gas emissions. Indeed, my district of
Sacramento has benefited from these dollars through programs
like low-carbon transportation projects and the Community Air
Protection Program, which prioritizes air quality in frontline
communities.
Dr. Kaufman, there seems to be a misconception that carbon
prices must be incredibly high to be effective. Based on
experience in California and other jurisdictions at home and
abroad, how would you respond to that misconception?
Dr. Kaufman. Well, I think what you want to do is exactly
what the committee is doing, which is set your long-term
target--and net zero makes a heck of a lot of sense because at
the global level climate change will continue until we get to
net zero carbon dioxide emissions--and then you want to work
backwards from there and say, what do you want to achieve in
the near term to get on that pathway?
And what our research suggests is that, you know,
particularly if you, you know, surround a carbon price with a
set of complementary policies, a price that is in the $30-,
$40-, $50-per-ton range could be incredibly effective at
reducing emissions and getting you on that net zero pathway.
Ms. Matsui. OK. We have made significant strides in
deploying renewable energy and increasing efficiency measures.
It is clear that our country has a long way to go in
transitioning into a clean energy economy.
Dr. Kaufman, given this, do you think it is necessary that
a carbon price include a requirement that at least a portion of
that money be spent on things like renewable energy, additional
emissions reduction efforts, and research and development?
Dr. Kaufman. I would say it depends on what your policy
objectives are and what the details of the carbon price itself
are. I certainly think that investments are going to be needed.
You know, we need--you know, think about the transportation
sector, and if we are going to, you know, over the next few
decades switch away from gasoline and diesel vehicles, we need
to facilitate this shift so drivers are comfortable doing that.
So we need to get that money from somewhere.
That said, I think, you know, the carbon pricing revenue is
just government revenue, right? So I think policymakers need to
come to a consensus on the best way to use that revenue. It is
the price signal itself that is going to do the most at
reducing emissions.
Ms. Matsui. Right. Absolutely.
OK. I am already running out of time.
So thank you very much.
Mr. Tonko. The gentlelady yields back.
The Chair now recognizes the gentleman from California,
Represent Ruiz, for 5 minutes, please.
Mr. Ruiz. Thank you very much, Mr. Chairman.
And thank you to all the witnesses here today to discuss
the importance of decarbonization. I want to talk about one of
the primary options to reduce carbon emissions that we have
been talking today, which is putting a price on carbon and how
the revenue produced by such a price will be utilized.
Leading into that, I want to help you understand the
situation in my district, California's 36th--Eastern Riverside
County in the Coachella Valley, San Jacinto Valley, Southern
California area--and present to you the specific challenges
faced by my constituents when it comes to carbon pollution.
Separating the Coachella Valley from the Los Angeles Basin is a
stretch of mountains. The only break in those mountains is the
San Gorgonio Pass. The pass is a gateway for millions of cars
and truck traveling on Interstate 10, usually from the ports to
Arizona. But it also acts at a wind tunnel, bringing regular
intense wind into our community. You might have seen the shots
of the windmills in the movies there in Palm Springs. This air
often includes high levels of pollutants and carbon emissions
that weren't produced in my district.
According to an analysis done by Northern Arizona
University, the Los Angeles County produces 55 percent of all
the emissions from the five surrounding counties, including San
Bernardino, Riverside, Orange, and Ventura Counties. In fact,
the carbon pollution from the ports alone matches the total
residential and commercial output from all of Riverside County.
Just think about that. And as you know, carbon pollution is
rarely emitted alone. It is often emitted alongside other
harmful elements, such as nitrogen oxide and sulfur.
So, for the majority of the year, these pollutants blow
east towards my constituents, and these increased levels of
greenhouse gases worsen ozone pollution for which the Coachella
Valley has been in nonattainment with the Clean Air Act since
1997. And, as an emergency physician, I know all too well what
this looks like. It is children with increasing rates of
asthma. It is more frequent heat stress among the elderly. It
is exacerbated respiratory diseases among those who already
struggle with respiratory ailments, and the list goes on and on
and on.
It is important to note that, even though my district does
not produce the large volumes of carbon pollution, we have
taken enormous initiatives when it comes to decarbonization and
renewable energy. In fact, my district produces the most
renewable energy on Federal land compared to other districts in
the entire United States.
The point is that air quality in my district is poor. The
majority of air pollution is not created in my district. Yet
the people I represent and the people I cared for in the
emergency department bear the health burdens. Furthermore, it
is the rural, underserved, resource-poor communities in my
district and throughout the Nation that are disproportionately
most affected.
So how do we address equity in any cost to carbon emissions
so that those who don't produce the pollution, don't live in a
big city, but are impacted by the pollution caused there get
their fair share of revenues to address the public's health? In
my home State of California, the State's cap-and-trade program
has provided an important source of revenue for communities
struggling with air pollution. In 2018, 39 percent of
investments from program venues went to disadvantaged
communities. So these are the same communities that are more at
risk of being exposed and having the public health risks.
So, Dr. Kaufman, can you speak to how revenues from a
national carbon pricing program could help improve air quality
at the local level, especially in communities where investment
is needed most?
Dr. Kaufman. Right. Well, thank you for the question.
So, again, the revenue from a carbon pricing program, that
is just government revenue, and it can be used to achieve many
different important priorities. And I think you are listing one
critical priority.
You know, I would point out that, as you correctly noted,
it is not the carbon pollution that is causing, you know, the
health issues. It is the other pollutants. So we also, you
know, should push on the Clean Air Act and other legislation,
if needed, to directly address those sources of pollution.
Mr. Ruiz. So what about the concept of a carbon price
dividend that is targeted at frontline communities? How do we
ensure that those dividends reach the right populations?
Dr. Kaufman. Well, fortunate----
Mr. Ruiz. Suggestions?
Dr. Kaufman. I am sorry? What----
Mr. Ruiz. Any suggestions?
Dr. Kaufman. Just that the carbon price would provide
hundreds of billions of dollars a year, if we are talking about
sort of a reasonably priced, you know, program. So you would
have a lot of money at your disposal to invest into communities
like those, to deal with this issue.
Mr. Ruiz. So we just have to make sure at the back end,
once there is the revenue, that the equation focuses on carbon
cost equity for the communities that need them the most because
they suffer the ailments the most.
Thank you.
Mr. Tonko. You are welcome. The gentleman yields back.
The Chair now recognizes the gentleman from California, Mr.
McNerney, for 5 minutes, please.
Mr. McNerney. I thank the chairman and ranking member. I
thank the witnesses this morning.
Mr. Esty, before coming to Congress, I spent my career
developing wind energy technology, and that gave me an
appreciation for how hard it is to get funding and financing
and so on for that technology.
Can you elaborate on how policy can create incentives for
capital to flow into developing renewable energy technology?
Mr. Esty. Sure. I think we have talked today about the
importance of a price signal attracting both research and
development money and also deployment money. And I think we
have also mentioned that we want, beyond an economy-wide price
signal, the benefit of some more targeted efforts. And in
Connecticut, we created a green bank, and that green bank has
allowed us to ramp up dramatically the flow of capital into
wind energy, solar power, energy efficiency. And I think there
is a real opportunity to replicate that at the national level.
Mr. McNerney. OK. That includes storage, right?
Mr. Esty. Includes storage, includes anything that helps
you move towards a decarbonized future. And I think what you
get with a green bank is the ability to use limited public
money to leverage private capital. And in Connecticut, we are
seeing something approaching $7 of private capital now for
every dollar of government money.
Mr. McNerney. Thumbs up.
Mr. Esty. The solar world loves it. The wind world loves
it, and the energy efficiency guys benefit as well.
Mr. McNerney. Thank you.
Mr. Gattie, is there a dangerous synergy between climate
change and the loss of biological diversity?
Dr. Gattie. Yes, sir, there is.
Mr. McNerney. Is there any--I mean, I think they both feed
on each other and aggravate each other's growing concern.
Dr. Gattie. Yes, sir. I agree.
Mr. McNerney. Mr. Kaufman, do you agree?
Dr. Kaufman. I do.
Mr. McNerney. Is there any policy approach that would help
decouple those or would help reduce the biological diversity
amplification of this problem?
Dr. Kaufman. Well, I think the committee is doing exactly
the right thing. What we need to do is sort of halt climate
change as quickly as we can. And I think net zero by 2050 is a
perfectly reasonable goal because, the more temperatures rise,
the more those risks and others will build.
Mr. McNerney. Well, do you believe that reducing carbon
emissions alone, Dr. Kaufman, will be sufficient to prevent
climate catastrophe?
And the reason I ask that is because there is a significant
and undefined latency between the time carbon is emitted into
the atmosphere and the time that we are starting to see these
effects. So we could be seeing the effects of carbon emitted 10
years ago, we still have 10 years of carbon buildup since then
that are going to continue to throttle the climate change.
Dr. Kaufman. That is exactly right. So, you know, at this
point, it is not about--you know, it is not about making sure
climate change doesn't exist. It exists already. It is with
us--every tenth of a degree of temperature that it goes up
further will make it worse. So it is just a matter of, you
know, stabilizing temperatures to minimize those risks.
Mr. McNerney. So, I mean, just reducing carbon emissions
alone--how about if we add in taking carbon out of the
atmosphere and sequestering it? With carbon emission reduction,
is that going to be enough to prevent catastrophe, in your
opinion?
Dr. Kaufman. Well, I think we need to get to net zero
emissions. So carbon dioxide emissions--the sources of
emissions as well and, you know, balanced with the sinks, and
that is trees, forests, as well as technological options, like
direct air capture and storage underground. We need to balance
the sources with the sinks, and that is what is going to
stabilize temperatures over time.
Mr. McNerney. Do you think we need to move toward climate
engineering?
Dr. Kaufman. I think it is worth studying.
Mr. McNerney. The science--Dr. Gattie?
Dr. Gattie. I wouldn't jump out and say yes, absolutely.
That is a--that connects a lot of issues across States and
continents. So are is some unintended consequences that could
come out of that that we would really need to----
Mr. McNerney. Well, there are unintended consequences of
adding carbon to the atmosphere for the last hundred years.
Dr. Gattie. And I agree with us doing everything we can to
reduce that. What I wouldn't want to do is anything that may
compound that, just unwittingly compound that.
Mr. McNerney. But the science would be--it would be good to
develop the science?
Dr. Gattie. I think we should be looking at it, yes, sir.
Mr. McNerney. Mr. Profeta?
Mr. Profeta. Yes, we should develop the science. We should
be looking at everything we can do to minimize the risk.
Mr. McNerney. Thank you. I yield back.
I am the last guy?
Mr. Tonko. You just may be, I believe, looking around.
I believe the list of Members that chose to question our
panel has been completed.
And before we adjourn, I request unanimous consent to enter
the following into the record. We have a letter from Our
Children's Trust, a letter from the Portland Cement
Association, a letter from Michael Gerard of Columbia Law
School and John C. Dernbach of Widener University Commonwealth
Law School, a letter from the Environmental Defense Fund, and
then two letters that earlier were referenced that were entered
into the record by Representative Barragan.
So, without objection, so ordered.
[The information appears at the conclusion of the
hearing.]\1\
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\1\ The letter from Our Children's Trust has been retained in
committee files and also is available at https://docs.house.gov/
meetings/IF/IF18/20191205/110295/HHRG-116-IF18-20191205-SD003.pdf.
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And, again, we thank our witnesses for sharing all of the
information that they have shared here this morning. It is very
important and helpful to the goals that we have established as
a subcommittee.
I remind Members that, pursuant to committee rules, they
have 10 business days by which to submit additional questions
for the record to be answered by our witnesses. So I would ask
each witness to please respond promptly to any of such
questions. And you may, you know, receive them from our
colleagues.
So, at this time, the subcommittee is adjourned. Thank you
again.
[Whereupon, at 12:40 p.m., the subcommittee was adjourned.]
[Material submitted for inclusion in the record follows:]
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