The U.S. economy will experience robust growth of about 70 percent through 2030 even as it adopts policies to lower greenhouse gas emissions leading to a more sustainable environment, according to an analysis released today by the U.S. Climate Action Partnership (USCAP).
The economic analysis estimates that U.S. GDP will grow 70 to 71 percent through 2030 assuming the adoption of climate legislation similar to the Blueprint for Legislative Action, USCAP’s set of recommendations for climate policy. In the absence of climate policy, U.S. GDP would grow 71 to 72 percent through 2030.
“A comprehensive approach to addressing the climate challenge can deliver urgently needed reductions in greenhouse gasses without interfering with economic growth now and in the future,” said Dr. Janet Peace, Vice President, Markets and Business Strategy for the Pew Center on Global Climate Change, speaking on behalf of USCAP.
The USCAP analysis was conducted using two economic models (ADAGE and NEMS-USCAP) similar to those employed by the Environmental Protection Agency (EPA) and the Energy Information Agency (EIA) in their review of climate legislation.
The models show that adopting climate legislation causes an almost imperceptible dip in the growth of GDP through 2030. Under a business-as-usual scenario where no climate legislation is enacted, the total output of the U.S. economy is projected to reach $22.3 trillion by 2030. With the Blueprint climate policy, the economy would arrive at this point two to four months later, depending on the scenario examined.
In addition, the USCAP analysis projects that household purchasing power will be greater by $8,000, $17,000, and $35,000 in 2015, 2020, and 2030, respectively, compared to 2010.
USCAP notes these results are comparable to those reported by the EPA and EIA in their examination of the American Clean Energy and Security Act introduced by Reps. Waxman (DCA) and Markey (D-MA).
The study found that the use of carbon offsets is an essential ingredient in containing costs. Delays or strict limits on a domestic and international offsets program will very likely increase total costs. In addition, the study found that complementary policies for energy efficiency, transportation and the accelerated development of carbon capture and sequestration, among others, are especially important to advance technology and lower future energy spending.
The USCAP economic study, which uniformly finds continued economic growth, stands in stark contrast to the portrayals of modeling results from some other studies that claim significant economic damage from climate legislation. Even though such studies examine a “worst case scenario,” with technology and offsets both severely limited, closer examination reveals continued growth in GDP, employment and household income over time.
In fact, some organizations severely constrained their models to preclude nearly all use of advanced technologies and/or offsets to lower emissions. But even these constrained models show strong economic growth through the future.
“There is no question that we can address the climate challenge in a way that protects consumers while at the same time growing our economy,” said Peace. “While there are costs involved, these are modest and prudent investments in a cleaner, more secure and sustainable future.”
