We hear a lot about the price of climate change legislation. Proponents insist that the cost would be negligible, while the opposition insists that it would staggering. But what about the cost of not passing a clean energy bill?
Instead of trying to predict the future, let’s look back at the renowned eight-year period of climate inaction. An analysis by the Center for American Progress indicates that the result of the Bush-Cheney energy plan was that energy costs rose more than $1000 for the average household:
Over this period, the typical annual American household expenditure on electricity rose more than $170, and the typical annual American expenditure on gasoline rose more than $960 (in 2007 dollars). Note that the gasoline price increases listed here do not include the unprecedented $147 per barrel of oil and $4.11 gasoline prices that occurred in the summer of 2008.
The cost of residential electricity grew 1.6 times faster than general inflation, while the price of gasoline grew 6.4 times faster. The average gas price for March 2009 was up 67% from the $1.28 of March 2002. All this happened despite the billions of dollars in subsidies for coal, oil, and nuclear energy.
Now, the Bush Administration itself is not the important factor here. The main point is that we had no clean energy bill, no carbon cap or EPA regulations, no federal action on climate change — essentially what climate bill opponents are proposing today. And energy prices still went up.
On the other hand (from CP),
York University School of Law’s Institute for Policy Integrity published a recent analysis that found the “clean air, clean water, clean energy jobs bill creates $1.5 trillion in benefits.” But that was at a low societal cost of carbon. For a more reasonable estimated cost of the impacts of carbon dioxide, say, $68, they estimated the total cumulative net benefit of climate action is $4 trillion (see Chart 2, page 31 here). And that didn’t even include an analysis of the plausible worst-case scenario for global warming, which we now know is 13-18°F over most of U.S. and 27°F in the Arctic in 50 years!
In fact, a more rigorous new analysis by top “scientists led by a former co-chair of the Intergovernmental Panel on Climate Change” found the “net present value of climate change impacts” of $1240 TRILLION on current emissions path, making mitigation to under 450 ppm a must.
Clearly, doing nothing is the most costly choice.