Green Action Can Grow the Economy
Policies to reduce greenhouse gas emissions can both fight global warming and boost the state economy, according to a team led by UC Berkeley professors.
In fact, implementing just eight out of thirty policy strategies proposed by California’s Climate Action Team would increase the Gross State Product by $60 billion and create more than 20,000 new jobs.
“Taking action to reduce global warming emissions in California is good for the California economy,” says report co-author Michael Hanemann, professor of agricultural and resource economics at CNR. “Not only does climate action pay, but early climate action pays more.”
The researchers evaluated the economic implications of meeting global warming emissions reduction targets established by Gov. Schwarzenegger in 2005. The governor’s goals include reducing GHG emissions to 2000 levels by the year 2010 and to 1990 levels by 2020.
Although time and resource constraints required the group to focus on just eight proposals for reducing GHG emissions, the researchers found that even this small subset of policies could make extraordinary progress for the state. Of those proposals, policies to increase building efficiency and reduce vehicle emissions were forecast to have the greatest impact, in terms of both emissions reduction and economic benefits.
“The climate action strategies benefit California economically because innovation and efficiency save money for California consumers who redirect their spending in ways that stimulate in-state job growth,” says David Roland-Holst, CNR adjunct professor of agricultural and resource economics and report co-author.
The report corroborates the state’s recent findings that the governor’s targets can be achieved with net economic benefits. “Our analysis reveals the power and promise of taking early initiative,” concludes Alex Farrell, assistant professor at UC Berkeley’s Energy and Resources Group and another co-author. “By acting sooner, California benefits more quickly from faster economic growth and improves its competitive position in a global market increasingly focused on climate action.”