As the U.S. Senate debates clean energy and climate legislation, a new economic analysis finds that strong federal policy could stimulate both employment and income growth across the national economy. The new study was conducted by the University of California in collaboration with University of Illinois and Yale University and provides an in-depth, state-by-state examination of the impacts of three pillars of federal legislation: energy efficiency, renewable energy and limits on carbon pollution.
“This report shows that stronger federal energy and climate policies are compatible with economic growth,” said the report’s lead author David Roland-Holst, Adjunct Professor of Agricultural and Resource Economics at UC Berkeley. “Those who say we cannot afford to take action now may not understand the opportunity we stand to lose by not acting. By revenue, energy is the world’s largest industry, yet traditional energy use patterns have created unsustainable carbon liabilities that threaten all of us. The next great knowledge-intensive sector will arise in an emerging multi-billion dollar global clean energy market. To participate in this technology breakout, we need policies that price carbon risk responsibly and create appropriate incentives for investors and innovators.”
Using EAGLE, a new state-of-the-art forecasting model, the study assesses the detailed economic implications of climate and energy policies currently under consideration in Congress. On a state-by-state basis, the study models both moderate and aggressive implementation of policies that put a cap on carbon emissions, create a market based program to reduce carbon emissions, and standards for and investments in renewable energy and energy efficiency.
The study is available in summary form as a PDF: Report: New ARE Study Projects Growth Dividend.