We need a portfolio of proven low-carbon energy technologies, says Ernest Moniz.
Dear Mr. President:
The country faces energy challenges that we cannot put off to a next administration or a next generation. We are running out of time to develop and deploy technologies that can mitigate climate risk and enhance national security.
The urgency stems from the collision of two realities. On the one hand, energy is a highly capitalized, multitrillion-dollar commodity business with highly developed supply chains, and it provides essential services and requires extensive regulation. Substantially changing the energy mix takes decades.
On the other hand, any prudent evaluation of climate-change risks suggests that concentrations of atmospheric greenhouse gases must be stabilized within a few decades. We must begin moving toward a low-carbon energy future now. Furthermore, only a global commitment will do. American leadership is essential if we are eventually to bring China and other emerging economies into a worldwide effort to mitigate these risks.
Reducing our dependence on hydrocarbon fuels will also promote energy security, providing more latitude in foreign policy.
In this context, I respectfully suggest the following actions for the first year of your administration:
(1) Implement carbon dioxide emissions pricing, most likely through a cap-and-trade system. Charging for carbon emissions will stimulate the market to introduce low-carbon technologies. The cap-and-trade system should move as quickly as possible toward an auction system, with the funds returned to the public in a progressive manner.
(2) Work with the private sector to provide a portfolio of proven, cost-effective low-carbon energy technologies. Goals should include new nuclear power plant construction, a strong renewables program, and a program to demonstrate large-scale carbon dioxide sequestration. Realistically, this will require a small charge on energy supply. The scale of the program needs to be in the range of $10 billion a year for 10 to 15 years.
(3) Establish a mechanism for coördinating the many interests that must influence a coherent energy policy: national security, foreign policy, environmental policy, agricultural policy, fiscal policy, and so on. The administration’s policy position must also reflect the legitimate and often diverging energy interests of different regions of the country. The Department of Energy does not have the capacity to bring together these disparate interests without help from the White House. One option is to appoint an assistant to the president for energy, who would work with the energy secretary.
(4) Commit to implementing, within 10 years, a 21st-century electricity grid that will enable development of large-scale regional resources for renewable electricity. Introducing energy efficiency standards for new buildings and financial incentives for retrofitting existing buildings should be a high priority.
Ernest J. Moniz is Director of The MIT Energy Initiative.