Full Title: Toward a New National Energy Policy: Assessing the Options
Author(s): Alan J. Krupnick, Ian W.H. Parry, Margaret Walls, Tony Knowles, and Kristin Hayes
Publisher(s): National Energy Policy Institute and Resources for the Future
Publication Date: 11/2010
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Since the 1950s, the United States has almost tripled its annual energy consumption, following a trend of substantial U.S. economic growth in the latter 20th century. Yet with this growth in energy use have come new challenges—in particular, our increasing reliance on imported oil, which can have signiﬁcant foreign policy implications; and a documented rise in the level of greenhouse gases accumulating in the atmosphere, which many scientists believe may lead to a rise in global temperature, changes in water supply, an increased threat of extreme weather events, and other negative consequences on food supply and human health.
From these twin challenges emerges a clear message: reducing our reliance on traditional fossil fuels must be central to any strategy to meet the goals of improving energy security and combating global warming. Despite numerous congressional proposals to control GHG emissions and promote alternative sources of energy, we have yet to pass and implement a comprehensive energy policy. With the recent volatility in the price of oil, continued warnings about climate change, and persistent dependence on oil from governments often hostile to our interests, the time is ripe for a rigorous, wide-ranging analysis of U.S. energy policy options.
Complicating matters is a bewildering array of policy alternatives. Some are substitutes for one another and others could reinforce each other; some directly target oil and others focus on emissions. How should policymakers choose among them? The analysis presented here helps meet this challenge. Carried out by Resources for the Future and the National Energy Policy Institute with support from the George Kaiser Family Foundation, it assesses 35 different policies and policy combinations based on their societal costs and their ability to reduce oil consumption and CO2 emissions. Each is evaluated and ranked using a consistent and rigorous methodology. The results provide policymakers with a wealth of valuable information for developing a coordinated national energy policy.
This report provides a comprehensive examination of the study ﬁndings, built around three key chapters: one exploring the effects of oil policy options, focusing on transportation; another detailing impacts of policies to reduce CO2, focusing on the electricity sector and energy efﬁciency; and a third that examines the results of combining policies to reduce both oil use and CO2 emissions. We also provide considerable detail on our modeling and methodology, and highlight areas where future researched may be warranted.