A Green New Deal Is Already Happening
The transition to electric cars and clean energy is happening faster than anyone expected. All politicians can do is choose to accelerate it.
When people talk about a Green New Deal, skeptics often ask about its price: Can America afford a vast new investment program focused on the transition to clean energy? But what those skeptics — and perhaps the climate pessimists also — overlook is just how much progress has already been made, and how inevitable the end of the oil era now appears. A Green New Deal is already happening, right in front of our eyes. It’s just hard to see the big picture clearly.
If you want a glimpse, you can begin far from the coalfields of West Virginia. Electric vehicles tore a massive hole through China’s auto market in 2018, with about 1.2 million new electric cars hitting the road there last year. Chinese electric vehicle sales grew by 60%, while internal combustion engine vehicle sales fell for the first time in two decades.
A major policy push by the authorities in Beijing was behind the shift. China has a massive air pollution problem and decided, starting in 2014, to push back. Halting the growth, and eventually the existence, of gas-burning cars is a stated government policy. But there’s another way to think about China’s push to strangle its future oil consumption. An electric vehicle requires 70% less energy to travel one mile than a car powered by gasoline. China’s cultivation of a flowering electric car industry is not a burdensome cost, but rather a lucrative investment. Run that investment over two decades and the savings are enormous. You could describe those savings as a profit, if you like — not just in economic terms, but for human wellbeing.
People believe a Green New Deal will be enormously expensive — we think of FDR’s vast public spending in the wake of the Great Depression, and assume hundreds of billions in upfront investment. But the real story is that we’ve already seen huge payoffs on the relatively modest investments made on clean energy. Many of the early government research investments which kick-started development of renewable energy and electric vehicles took place long ago, and a recent paper from MIT shows how public investment helped deliver today’s incredibly cheap solar power systems. Aware of these potential gains, the incoming Obama administration in 2009 decided that accelerating the rollout of wind and solar power didn’t require more research — instead, the industry needed loan guarantees.
Ten years later, we are reaping huge rewards. Over 20% of California’s electricity is now produced by the wind and the sun, up from just 2.6% in 2010. The story in Texas is similar, where wind and solar have also reached 20% of electricity supply. In Great Plains states like Iowa and Oklahoma, over 40% of electricity is produced by the wind. Were the economies of Texas or California somehow damaged by all that green growth? Was capitalism constrained? Were citizens put upon? Hardly. Tonight, many Texans will happily charge their electric car while they sleep and the great winds blow and electricity prices fall. Tomorrow, participating electric vehicle owners in California will use an app and charging equipment to do the same, shifting their charging needs to midday, when the solar fields awaken in the blazing sun.
Here’s the simple truth: A green way forward will now cost far less than even the optimists imagined a decade ago. The Energy Information Administration just reported that US electric bills broke a decadelong rising trend and started falling in 2015. Better still, as costs continue to crash, job creation has exploded. Renewable energy industries in the US employed 4 million people by 2016, according to the Environmental Defense Fund — far more than the coal industry. Notice the relationship: costs falling, consumers getting better prices, and employment demand rising. It sounds like the beginnings of a Green New Deal to me.
Critics of renewable energy only want to talk about the price tags for building new systems, avoiding any discussion of the economic returns on such investments. But solar is now the cheapest form of new electricity on the planet. No subsidies needed. Fighting solar is now a losing economic battle.
This is all excellent news, but none of it is happening fast enough. Fossil fuel combustion began in earnest nearly 250 years ago when coal, which had been lying about the surface of Britain, started being burned. Two centuries of carbon output later, and we are fighting a rearguard action against climate change. We’ll probably avoid the worst scenarios, as modeled by the Intergovernmental Panel on Climate Change, but the reality is inescapable: We need to accelerate the changes that are already happening. That’s where a Green New Deal comes in.
So how do we think about the cost? One way is to consider the extreme inefficiency of the fossil fuel system we’re already running — those costs form a lot of the investment budget we’ll need to accelerate the transition to something cleaner.
Fossil fuels are enormously powerful energy sources, dense with packed energy. Coal has nearly four times the energy content of wood, and raw oil is another 50% more powerful than coal. Jet fuel and gasoline, well, moreso. The prospect that we could ever leave these miracle fuels behind has long seemed fanciful. And besides, they’re embedded into every corner of the world’s infrastructure like an impacted molar. But there’s a thermodynamic loss that comes every time you burn coal in power plants and gasoline in cars. And the loss is not small. Generally speaking, for every dollar the world spends on fossil energy, we only get about 50 cents’ worth of the energy. The other half is lost to the atmosphere. Lawrence Livermore National Lab estimates a shocking 65% of the energy the US burns is wasted. Heat flies off natural gas power plants. Buildings leak like a bag full of holes. And worst of all are the cars, billions of individual engines with myriad surfaces hemorrhaging energy. As you’ve probably figured out: That’s not just an economic loss, but an environmental loss.
If you think a Green New Deal is all about costs, then let me convince you otherwise. The world consumes about 400 billion gallons of gasoline per year. But the same amount of work — all that hauling, road-tripping, and commuting — could be performed by an electric vehicle fleet using 70% less energy. Sure, we'd like to snap our fingers and make that happen overnight. But by making that transition over two decades shifts the costs so judiciously across millions of users that they, and the economy, will also enjoy the gains.
Just take a look at today’s electric car owners, who aren’t exactly suffering. Yes, they paid a slightly higher upfront cost for their car. But like the homeowner who pays for better roof insulation, they are now sitting back and getting paid in yearly gains in the form of much lower fuel costs. That’s a model for transition that’s already playing out in China, Europe, and the US as well: Buy a new machine that’s far more efficient, and over time you come out ahead. Way ahead.
The real question remains: How can we make this move faster?
An effective Green New Deal with real teeth and staying power will be more about design than money. We need an array of policy pushes that leverage the gains we know are in store, just waiting to be unlocked. One such example: 360,000 new electric vehicles were sold in the US last year, taking 2% of the US vehicle market (California sold half of those, making up nearly 9% of its own market). Ensuring their interoperability, which governs how these cars “talk” to the electrical grid, would smooth the path by which owners and utilities can use one another to broker electricity demand, and prices, to the benefit of all.
And cars are not the only emerging, networked battery we’ll have available to us. The nation has 125 million households, most equipped with a water heater. The technology to make those heaters smart is already cheap and being tested. But there is not yet a uniform standard that would enable utilities and water heaters to communicate. If there were, and heaters start shipping with the same device standard, then customers can win on power prices, and utilities can integrate these virtual batteries into new wind and solar generation systems.
So a Green New Deal should focus on supercharging technologies that already exist, just like China is doing with electric car adoption. And by getting existing technology to roll out faster, you will clear a path for new technologies to join in.
There are places where brute force policies will be necessary. New York state, for example, still has huge numbers of apartment buildings and houses using dirty, inefficient oil-based heating. We should just pay these property owners to rip out those old systems. New York just joined the other Eastern Seaboard states in committing to a multiyear deployment of offshore wind farms, now that the cost of wind energy has — you guessed it — crashed down to insanely affordable levels. New York could easily become a giant of wind power, providing lots of new electricity for heating, even if many systems convert from oil to natural gas. Any credits or payments Albany made to property owners to shed antiquated oil heating systems would simply come back later in the form of systemic economic gains.
A helpful way to think about our current juncture is that we are on course, right now, to roll out a Green New Deal within the next 20 years through basic market forces alone. Under a passive US government (yes, I know) that neither tried to stop nor promote these changes, we will see combined wind and solar power go from producing 10% of US electricity today toward 40% or even 50% by 2040. And in 2040, electric vehicles will, with the exception of trucks, have dominated the market regardless. Oil consumption will decline meaningfully; and coal, as in Britain, will almost entirely disappear.
Good policy can accelerate this. You’ll need not only good design, but spending to help the economy with the large, upfront costs of new energy adoption. Advocates of a Green New Deal should avoid the obvious own-goal of focusing on price tags. Incentives are superior to edicts — the former break down barriers for existing technology, and parcel out the costs into pieces the economy can digest. And ultimately, this isn’t about the costs we will incur, but the massive savings, for our economy and our planet.
Gregor Macdonald is a freelance journalist who covers cities, climate, and energy. He is the author of the recently released Oil Fall: How Wind and Solar Will Jailbreak the Powergrid, and Find Their Way Into Global Transportation. You can find more of his work at www.gregor.us.