The Business Roundtable says Congress and the Administration must protect energy security and economic growth while shaping a policy to reduce the emission of greenhouse gases. Government must “expand and modernise the electric grid in order to develop our renewable energy potential,” it urges in its report Unfinished Business: The Missing Elements of a Sustainable Energy and Climate Policy.
“To satisfactorily address our energy and climate needs, a commitment to energy efficiency and all forms of energy production, including expanded oil and natural gas production, will be required,” it states.
“A balanced, comprehensive portfolio of options will best ensure that we have adequate and diversified sources of energy available at reasonable prices to power our economy while taking those steps necessary to develop new technologies needed to address climate change. Any policy promoting only a subset of a comprehensive portfolio to the exclusion of the other elements will fall short of meeting our needs while imposing unreasonable costs on our economy.”
The report identifies areas in which technology investment and policy leadership are lacking, according to the association of chief executive officers of major US companies, and recommends action to rebalance energy policy. It commends Congress for its efforts to promote renewable energy and energy efficiency, but notes that more must be done.
Specifically, policymakers “must enhance energy efficiency in residential and commercial buildings and the industrial sector; maintain coal’s long-term viability with robust R&D investments, cost-sharing, regulatory reform and incentives for the development of carbon capture and storage technology; encourage the expansion of nuclear power, the only existing, scalable low-carbon baseload generation technology; expand and modernise the electric grid in order to develop our renewable energy potential, improve our electric reliability and drive energy efficiency; and provide access for oil and natural gas exploration and production to enhance domestic energy security as alternative technologies evolve and mature.”
“While the United States can and should use energy more efficiently and use cost-effective renewables and other new sources of energy where possible, the reality is that we likely will continue to rely on oil, natural gas and coal for the majority of our energy for decades to come,” the report notes.
“Renewables and other alternatives, no matter how aggressively we pursue them, cannot be scaled up quickly enough to displace oil, natural gas or coal within the next several decades, even if we couple these efforts with an expanded commitment to energy efficiency. Today, wind, solar and geothermal energy resources generate less than 2% of our electric power, while ethanol and biodiesel contribute only about 4% of our nation’s transportation fuels.”
“All forms of renewables, including hydroelectric power, solar, wind, geothermal, biofuels and biomass, today supply only about 7% of our energy,” it adds. “While all of these alternatives hold promise, each have resource (eg: hydropower, biofuels) and economic limitations that make it unlikely that they will displace traditional fossil fuels any time soon.”
“These are the policies we must pursue to make our nation’s transition to a low-carbon economy as sustainable as possible,” says John J. Castellani of Business Roundtable. “President Obama and Congress have the opportunity today to build a lasting solution for the future by enacting legislation that will transform the way we use established American energy sources even as we explore new ones. By doing so, we can accelerate progress towards our climate goals, while supporting the economy during this time of transition.”
The country’s power grid must be modernised and extended to locations with renewable energy resources, to enable greater deployment of renewable power, the report explains. “The grid investments required to realise the full potential of wind and solar are likely to be significant,” noting that the American Wind Energy Association recently estimated that US$60 billion will be needed to install 19,000 miles of extra-high-voltage lines to allow wind to supply 20% of the country’s electricity needs by 2030.
Business Roundtable is an association of chief executive officers of US companies with US$5 trillion in annual revenues and 12 million employees. Member companies comprise one third of the total value of the US stock markets and pay 60% of all corporate income taxes to the federal government.