The Clean Power Plan – What Can We learn?

Honorary Associate Dan Cass looks at whether President Obama’s Clean Power Plan will work.

US President Barack Obama has declared, “no challenge provides a greater threat to the future of the planet” than climate change. Ahead of major climate change talks in Paris in November, he’s recently unveiled the Clean Power Plan to reduce carbon dioxide emissions by 32% from 2005 levels by 2030. It does this by setting the reduction goals for power plants, preventing new power plants being built unless they have emission-capturing technology and requiring US states to set and submit plans to show how they will meet targeted emission cuts by 2022.

Honorary Associate Dan Cass, of the BERN node, believes President Obama’s plan can be successful but there will be vigorous attacks on the proposal – both in the courts and in the court of public opinion – funded significantly by fossil fuel interests, especially the likes of the Koch brothers’ network. Obama is also expected to face opposition from states including West Virginia and Wyoming, where local economies rely on coal power plants. As many as 25 states could join a lawsuit against the US government. However, legal experts remain confident the plan can survive lawsuits.

Mr Cass believes there is support for climate action in the broader business community, especially with web based businesses, service companies and consumer brands that get PR benefits associating with clean energy and for whom electricity is relatively small input cost. “The next President – to be voted in next year – will be under considerable pressure from the fossil fuel lobby to change the policy. But there is significant support for clean energy from other industries and even major Republican figures,” he said. Mr Cass points to Jay Faison as one example – “a very interesting Republican and one to watch in the lead up to the 2016 election”. He is a successful entrepreneur, a Christian conservative and recently pledged $175 US million to campaign at the Republican Party base to support clean energy. His argument is that renewables represents a major new opportunity for American innovation, industrial reinvention, jobs growth and export income.

On a global scale, Mr Cass says Obama knows that America can lead other countries to take climate action. “If the world’s most powerful economy starts to switch from fossil fuels to renewables and energy conservation, it could pull China and others along with it.” Australia is one country under political pressure to demonstrate it’s a good global citizen. “The take-home message from the Clean Power Plan is that coal does not have the rosy future that Prime Minister Tony Abbott keeps promising.” Australia will also come under economic pressures if it fails to improve energy productivity and prevent households from cutting their electricity bills using rooftop solar.

Mr Cass acknowledges that the Clean Power Plan “falls far short of a complete solution but deserves support”. He says that it should be seen as merely one step in the broader context of the whole of economy transformation, which is required to achieve ecological sustainability. And as renewable energy technology costs fall below conventional energy costs, this should unleash the considerable financial, innovative and cultural power of venture capitalism. According to Bloomberg New Energy Finance, clean energy will be worth about $8 trillion by 2040, even assuming no subsidies after 2018 (except to off-shore wind until 2030). “Rapid, multi trillion dollar clean tech growth would give decisive momentum for climate action: demonstrating the desirability of a ‘green’ economy, creating significant jobs and delivering consumer benefits such as cheaper, cleaner energy, that will appeal to both conservative and progressive voters”, he said.

Top Image: Martin Nikolaj Bech via Flickr Commons