We stand at the verge of a major opportunity for leadership that can take our economy in a new direction. As supporters and opponents gird for a fight over a nationwide cap on carbon pollution, our nation is about to make a monumental choice between continuing with economic and energy policies we know are unsustainable and embracing a change we need to create jobs, improve our national security and protect our planet.
In the end, the debate over whether and how to cap America’s carbon pollution can be a major turning point toward prosperity and sustainability — or it can, once again, leave us with the status quo.
There has already been much discussion from right, left and center of how capping carbon pollution might affect our economy. Opponents will say — as they have many times in the past — that finally putting a price on the pollution that is a primary cause of climate change will wreck our economy.
But that is a fundamental misunderstanding of the situation we face. After more than a century of relying on fossil fuels as the leading driver of economic growth, it’s time to change course.
Right now our economy is running into the immutable laws of supply and demand in a global marketplace. As recent history has shown, over-reliance on fossil fuels puts our economy at the mercy of price fluctuations that hurt consumers and investors alike.
We also face the immutable laws of science, which tell us that the more carbon we pour into the atmosphere, the more we fundamentally disrupt the balance of our climate. The ecological, economic, humanitarian and strategic impacts of global climate change are just beginning to be felt, and left unchecked, these impacts and their costs will compound exponentially.
However, by making a fundamental shift in how we power our economy, we can address both of these crises. It is critical that Congress pass a complementary set of policies to simultaneously reduce the amount of global warming pollution we produce and rapidly increase the deployment of clean, renewable energy sources.
We have already made a down-payment on a clean energy future through the economic recovery package passed earlier this year. Its historic investment in new sources of electricity generation, transmission and improved energy efficiency are an important start and are already creating new jobs across the country. But these investments will not truly pay off unless we take the next step in repowering America by setting a clear cap on carbon pollution.
A cap will effectively close the carbon loophole that has allowed industries to pollute our air for decades. When it comes to electricity, which accounts for more than a third of our nation’s carbon emissions, our current legal and regulatory structure is designed to protect and promote incumbent fossil fuel sources. The primary result has been a failure to account for the true costs of these fuels.
This in turn has created artificial barriers to entry for new, cleaner forms of generation and has prevented the resulting job creation and economic growth. These hidden costs also have a much broader impact.
Our national security suffers when we spend billions of dollars on wars overseas fought in part to ensure our access to fossil fuels. Our economy falters when the energies we use are subject to wild fluctuations in price, as we saw with $4 per gallon gas last summer and will certainly see again. And, the climate crisis worsens, with recent data suggesting that the past 10 years have been among the dozen warmest on record, and that Greenland’s ice is melting faster than anticipated.
Creating a limit on carbon pollution will correct this market malfunction that has failed thus far to take these very real costs into account. And, by using a market-based approach, we can provide accurate price signals to investors, innovators and consumers enabling them to make smarter decisions about where to direct intellectual and financial capital.
We’ve done something like this before. To confront the scourge of acid rain in the early 1990s, the United States began a market-based program to cap pollutants like sulfur dioxide. President George H.W. Bush worked with a Democratic Congress to enact laws to free our air and water of those toxins. Back then, polluting industries said cap-and-trade was a burdensome tax that would hurt American consumers and kill the economy. Instead, it cleaned things up faster than anyone predicted, and electricity prices actually dropped in the wake of the legislation.
This time, the same industries are crying wolf again.
The debate about the cost of capping carbon must be an honest and full debate, and all the facts should be on the table. Yes, it should be a priority for Congress to design a system that protects consumers from any immediate price impact. But the tremendous cost of doing nothing to confront climate change must be a part of the discussion, as must the benefits of an expanding clean energy sector.
The gains to be made are profound — a switch to fuels that are free and limitless will jump start our economy, renew America’s global economic, technological and environmental leadership and fend off the most devastating impacts of climate change. At the same time, consumers and businesses will see their electricity bills drop as improved efficiency and expanded renewable power sources bring costs down.
If we miss this opportunity to pass comprehensive climate legislation, we should expect little change from the status quo — a prolonged economic downturn spurred by sending more money to foreign governments for increasingly scarce and polluting fuels, and an increasingly unstable global environment that we pass on to future generations.
It’s up to the 111th Congress to choose which future it supports.
Cathy Zoi, CEO of the Alliance for Climate Protection, is President Barack Obama’s nominee for assistant secretary for energy efficiency and renewable energy at the Department of Energy.