The Inflation Reduction Act — the health care and climate bill signed into law by President Biden on Tuesday — marks the largest climate action the federal government has ever taken. With about $370 billion earmarked for clean energy, electric vehicles and carbon sequestration storage, the bill will certainly reduce the nation’s greenhouse gas emissions. The question is how much. The most popular number — the one repeated by the president, scientists and journalists — is 40 percent. In a statement released shortly after the deal was reached, Democratic Sens. Charles E. Schumer (N.Y.) and Joe Manchin III (W.Va.) claimed the new bill would, by 2030, cut emissions by 40 percent from 2005 levels. This figure was later supported by results from three independent sets of models. The Rhodium Group, an economics and energy research firm, estimated that the bill would reduce emissions by 31 to 44 percent by 2030. Energy Innovation, a climate think tank, projected a 37 to 41 percent reduction. and a group of researchers from Princeton University called the REPEAT project estimated a carbon dioxide reduction of about 42 percent. The agreement between the senators’ claims and the projections isn’t a surprise — modeling teams advised Capitol Hill staff about the deal’s potential implications before it was made public, said Jesse Jenkins, one of the leaders of Princeton’s REPEAT modeling program. This 40% figure will be repeated in international climate negotiations and presidential speeches for years to come. It marks progress toward the president’s climate goal — to cut emissions in half by 2030 — and may offer some hope to the millions of young people who have been drawn to climate action in recent years. But is it right? That depends — on how you measure and what you measure with. At the heart of these predictions are scientists’ highly complex models of how the economy works, including how energy is used, which can provide useful predictions about the future and always be somewhat inaccurate. As a popular modeling saying goes: “All models make mistakes. some are useful.” The energy models used by Rhodium, Energy Innovation and Princeton researchers are complex systems of equations, spreadsheets and data that attempt to represent all the energy used in the United States over a period of time. These models can estimate how many solar farms will be built once tax credits are in place to make them cheaper, or how many Americans will buy electric cars in the next 10 years. The fact that all three independent modeling groups produced similar findings is a good sign for the results. However, there are still reasons to believe that the reality could be different from what the models suggest the bill’s impact will be — or what the public would expect. On the one hand, models predicting a 40% reduction in carbon emissions may be overly optimistic. Jenkins, the Princeton engineering professor, says one of the biggest problems is predicting how quickly consumers, utilities and businesses will switch to clean technologies. “The biggest thing in our model that is an abstraction from the real world is the assumption that economic factors drive decision making,” he explained. The models assume that human beings are rational agents who base their decisions on costs and benefits. in the real world, this is not always true. This means that if it is cheaper to build a wind farm than a natural gas plant, or cheaper to buy an electric car than a natural gas car, the model predicts that more wind farms will be built and more electric cars will be bought. The REPEAT model currently predicts that all cars sold in 2030 will be electric vehicles, since by then EVs are projected to cost less than gas-powered cars. But in the real world, some consumers will be afraid to switch to electric vehicles even if they’re cheaper, simply because they don’t see enough car chargers in their neighborhoods. Similarly, wind farms and solar panels may be blocked by locals who find them unsightly to look at. Long-distance transmission lines, which would be needed to move renewable electricity from one state to another, could also be stymied by red tape. External economic factors could also slow the push away from fossil fuels. Ben King, associate director of climate and energy at the Rhodium Group and one of the authors of the group’s IRA analysis, says cheap fossil fuel prices and faster-than-expected growth could lead to a slower-than-expected projected shift to cleaner energy sources.

  1. There is potential upside There are also reasons to believe that 40 percent is one underestimate on the effects of the bill. Jenkins notes that none of the models can effectively predict technological progress fueled by government cash — for example, research and development funding that causes costs to fall for solar, wind, carbon capture and storage, or batteries. These cost changes, he argues, could cause the transition to clean energy to proceed even faster than expected—but are difficult to predict in an energy model. The models also do not attempt to predict any changes in state and federal policies. However, in the coming years, many states and cities are likely to implement new climate policies, such as requiring electricity to come from renewable sources or phasing out gas-powered vehicles. “This bill makes it cheaper for every other jurisdiction in the country to raise their ambitions and their policies,” Jenkins said. It would also make it easier for the Biden administration to impose tighter limits on emissions from cars and power plants — which in turn could reduce CO2 emissions even further. However, there is no “sure thing” in modeling. Emissions reductions from the IRA may be higher or lower than the 40% estimate. Right now, modelers can only make a best guess at how the future will play out. But, Jenkins argues, the result is not that different from estimates of the cost of the bill. Since clean energy IRA provisions consist primarily of tax credits, it is difficult to predict how many of these credits will ultimately be claimed and how much the bill will cost the government and taxpayers. “Forty percent is an imperfect estimate,” Jenkins said. “But I think it’s a pretty good estimate.”

  1. Progress has already been made Depending on how you read that 40 percent estimate, it could be a bit misleading. This is a case where the models may be right, but not widely. The bill is expected to reduce emissions by 40 percent compared with 2005 levels — not comparable to current US emissions. That’s because emissions have already fallen significantly since 2005. Between 2005 and 2020, CO2 emissions fell by about 21 percent, thanks in large part to the switch from highly polluting coal to less polluting natural gas. (The COVID-19 pandemic also caused emissions to drop dramatically, as millions of cars and planes ground to a halt almost overnight.) Over the next eight years, emissions are expected to continue to slowly decline, thanks to cheap solar and wind power and a gradual shift to electric vehicles. Indeed, according to the same three modeling groups, by 2030, emissions are expected to drop by 24 to 32 percent — even without the CCA. That’s not to say the bill is without implications, of course. While it may not be as dramatic a change as it first seems, in a world where every extra ton of CO2 not emitted into the atmosphere can help limit global warming, an additional 10 to 15 percent reduction in emissions will help prevent serious environmental damage.

title: “The Ira Is Projected To Reduce Emissions By 40 . It S Not That Simple. Klmat” ShowToc: true date: “2022-10-23” author: “George Diaz”

The Inflation Reduction Act — the health care and climate bill signed into law by President Biden on Tuesday — marks the largest climate action the federal government has ever taken. With about $370 billion earmarked for clean energy, electric vehicles and carbon sequestration storage, the bill will certainly reduce the nation’s greenhouse gas emissions. The question is how much. The most popular number — the one repeated by the president, scientists and journalists — is 40 percent. In a statement released shortly after the deal was reached, Democratic Sens. Charles E. Schumer (N.Y.) and Joe Manchin III (W.Va.) claimed the new bill would, by 2030, cut emissions by 40 percent from 2005 levels. This figure was later supported by results from three independent sets of models. The Rhodium Group, an economics and energy research firm, estimated that the bill would reduce emissions by 31 to 44 percent by 2030. Energy Innovation, a climate think tank, projected a 37 to 41 percent reduction. and a group of researchers from Princeton University called the REPEAT project estimated a carbon dioxide reduction of about 42 percent. The agreement between the senators’ claims and the projections isn’t a surprise — modeling teams advised Capitol Hill staff about the deal’s potential implications before it was made public, said Jesse Jenkins, one of the leaders of Princeton’s REPEAT modeling program. This 40% figure will be repeated in international climate negotiations and presidential speeches for years to come. It marks progress toward the president’s climate goal — to cut emissions in half by 2030 — and may offer some hope to the millions of young people who have been drawn to climate action in recent years. But is it right? That depends — on how you measure and what you measure with. At the heart of these predictions are scientists’ highly complex models of how the economy works, including how energy is used, which can provide useful predictions about the future and always be somewhat inaccurate. As a popular modeling saying goes: “All models make mistakes. some are useful.” The energy models used by Rhodium, Energy Innovation and Princeton researchers are complex systems of equations, spreadsheets and data that attempt to represent all the energy used in the United States over a period of time. These models can estimate how many solar farms will be built once tax credits are in place to make them cheaper, or how many Americans will buy electric cars in the next 10 years. The fact that all three independent modeling groups produced similar findings is a good sign for the results. However, there are still reasons to believe that the reality could be different from what the models suggest the bill’s impact will be — or what the public would expect. On the one hand, models predicting a 40% reduction in carbon emissions may be overly optimistic. Jenkins, the Princeton engineering professor, says one of the biggest problems is predicting how quickly consumers, utilities and businesses will switch to clean technologies. “The biggest thing in our model that is an abstraction from the real world is the assumption that economic factors drive decision making,” he explained. The models assume that human beings are rational agents who base their decisions on costs and benefits. in the real world, this is not always true. This means that if it is cheaper to build a wind farm than a natural gas plant, or cheaper to buy an electric car than a natural gas car, the model predicts that more wind farms will be built and more electric cars will be bought. The REPEAT model currently predicts that all cars sold in 2030 will be electric vehicles, since by then EVs are projected to cost less than gas-powered cars. But in the real world, some consumers will be afraid to switch to electric vehicles even if they’re cheaper, simply because they don’t see enough car chargers in their neighborhoods. Similarly, wind farms and solar panels may be blocked by locals who find them unsightly to look at. Long-distance transmission lines, which would be needed to move renewable electricity from one state to another, could also be stymied by red tape. External economic factors could also slow the push away from fossil fuels. Ben King, associate director of climate and energy at the Rhodium Group and one of the authors of the group’s IRA analysis, says cheap fossil fuel prices and faster-than-expected growth could lead to a slower-than-expected projected shift to cleaner energy sources.

  1. There is potential upside There are also reasons to believe that 40 percent is one underestimate on the effects of the bill. Jenkins notes that none of the models can effectively predict technological progress fueled by government cash — for example, research and development funding that causes costs to fall for solar, wind, carbon capture and storage, or batteries. These cost changes, he argues, could cause the transition to clean energy to proceed even faster than expected—but are difficult to predict in an energy model. The models also do not attempt to predict any changes in state and federal policies. However, in the coming years, many states and cities are likely to implement new climate policies, such as requiring electricity to come from renewable sources or phasing out gas-powered vehicles. “This bill makes it cheaper for every other jurisdiction in the country to raise their ambitions and their policies,” Jenkins said. It would also make it easier for the Biden administration to impose tighter limits on emissions from cars and power plants — which in turn could reduce CO2 emissions even further. However, there is no “sure thing” in modeling. Emissions reductions from the IRA may be higher or lower than the 40% estimate. Right now, modelers can only make a best guess at how the future will play out. But, Jenkins argues, the result is not that different from estimates of the cost of the bill. Since clean energy IRA provisions consist primarily of tax credits, it is difficult to predict how many of these credits will ultimately be claimed and how much the bill will cost the government and taxpayers. “Forty percent is an imperfect estimate,” Jenkins said. “But I think it’s a pretty good estimate.”

  1. Progress has already been made Depending on how you read that 40 percent estimate, it could be a bit misleading. This is a case where the models may be right, but not widely. The bill is expected to reduce emissions by 40 percent compared with 2005 levels — not comparable to current US emissions. That’s because emissions have already fallen significantly since 2005. Between 2005 and 2020, CO2 emissions fell by about 21 percent, thanks in large part to the switch from highly polluting coal to less polluting natural gas. (The COVID-19 pandemic also caused emissions to drop dramatically, as millions of cars and planes ground to a halt almost overnight.) Over the next eight years, emissions are expected to continue to slowly decline, thanks to cheap solar and wind power and a gradual shift to electric vehicles. Indeed, according to the same three modeling groups, by 2030, emissions are expected to drop by 24 to 32 percent — even without the CCA. That’s not to say the bill is without implications, of course. While it may not be as dramatic a change as it first seems, in a world where every extra ton of CO2 not emitted into the atmosphere can help limit global warming, an additional 10 to 15 percent reduction in emissions will help prevent serious environmental damage.

title: “The Ira Is Projected To Reduce Emissions By 40 . It S Not That Simple. Klmat” ShowToc: true date: “2022-12-07” author: “Joe Schulte”

The Inflation Reduction Act — the health care and climate bill signed into law by President Biden on Tuesday — marks the largest climate action the federal government has ever taken. With about $370 billion earmarked for clean energy, electric vehicles and carbon sequestration storage, the bill will certainly reduce the nation’s greenhouse gas emissions. The question is how much. The most popular number — the one repeated by the president, scientists and journalists — is 40 percent. In a statement released shortly after the deal was reached, Democratic Sens. Charles E. Schumer (N.Y.) and Joe Manchin III (W.Va.) claimed the new bill would, by 2030, cut emissions by 40 percent from 2005 levels. This figure was later supported by results from three independent sets of models. The Rhodium Group, an economics and energy research firm, estimated that the bill would reduce emissions by 31 to 44 percent by 2030. Energy Innovation, a climate think tank, projected a 37 to 41 percent reduction. and a group of researchers from Princeton University called the REPEAT project estimated a carbon dioxide reduction of about 42 percent. The agreement between the senators’ claims and the projections isn’t a surprise — modeling teams advised Capitol Hill staff about the deal’s potential implications before it was made public, said Jesse Jenkins, one of the leaders of Princeton’s REPEAT modeling program. This 40% figure will be repeated in international climate negotiations and presidential speeches for years to come. It marks progress toward the president’s climate goal — to cut emissions in half by 2030 — and may offer some hope to the millions of young people who have been drawn to climate action in recent years. But is it right? That depends — on how you measure and what you measure with. At the heart of these predictions are scientists’ highly complex models of how the economy works, including how energy is used, which can provide useful predictions about the future and always be somewhat inaccurate. As a popular modeling saying goes: “All models make mistakes. some are useful.” The energy models used by Rhodium, Energy Innovation and Princeton researchers are complex systems of equations, spreadsheets and data that attempt to represent all the energy used in the United States over a period of time. These models can estimate how many solar farms will be built once tax credits are in place to make them cheaper, or how many Americans will buy electric cars in the next 10 years. The fact that all three independent modeling groups produced similar findings is a good sign for the results. However, there are still reasons to believe that the reality could be different from what the models suggest the bill’s impact will be — or what the public would expect. On the one hand, models predicting a 40% reduction in carbon emissions may be overly optimistic. Jenkins, the Princeton engineering professor, says one of the biggest problems is predicting how quickly consumers, utilities and businesses will switch to clean technologies. “The biggest thing in our model that is an abstraction from the real world is the assumption that economic factors drive decision making,” he explained. The models assume that human beings are rational agents who base their decisions on costs and benefits. in the real world, this is not always true. This means that if it is cheaper to build a wind farm than a natural gas plant, or cheaper to buy an electric car than a natural gas car, the model predicts that more wind farms will be built and more electric cars will be bought. The REPEAT model currently predicts that all cars sold in 2030 will be electric vehicles, since by then EVs are projected to cost less than gas-powered cars. But in the real world, some consumers will be afraid to switch to electric vehicles even if they’re cheaper, simply because they don’t see enough car chargers in their neighborhoods. Similarly, wind farms and solar panels may be blocked by locals who find them unsightly to look at. Long-distance transmission lines, which would be needed to move renewable electricity from one state to another, could also be stymied by red tape. External economic factors could also slow the push away from fossil fuels. Ben King, associate director of climate and energy at the Rhodium Group and one of the authors of the group’s IRA analysis, says cheap fossil fuel prices and faster-than-expected growth could lead to a slower-than-expected projected shift to cleaner energy sources.

  1. There is potential upside There are also reasons to believe that 40 percent is one underestimate on the effects of the bill. Jenkins notes that none of the models can effectively predict technological progress fueled by government cash — for example, research and development funding that causes costs to fall for solar, wind, carbon capture and storage, or batteries. These cost changes, he argues, could cause the transition to clean energy to proceed even faster than expected—but are difficult to predict in an energy model. The models also do not attempt to predict any changes in state and federal policies. However, in the coming years, many states and cities are likely to implement new climate policies, such as requiring electricity to come from renewable sources or phasing out gas-powered vehicles. “This bill makes it cheaper for every other jurisdiction in the country to raise their ambitions and their policies,” Jenkins said. It would also make it easier for the Biden administration to impose tighter limits on emissions from cars and power plants — which in turn could reduce CO2 emissions even further. However, there is no “sure thing” in modeling. Emissions reductions from the IRA may be higher or lower than the 40% estimate. Right now, modelers can only make a best guess at how the future will play out. But, Jenkins argues, the result is not that different from estimates of the cost of the bill. Since clean energy IRA provisions consist primarily of tax credits, it is difficult to predict how many of these credits will ultimately be claimed and how much the bill will cost the government and taxpayers. “Forty percent is an imperfect estimate,” Jenkins said. “But I think it’s a pretty good estimate.”

  1. Progress has already been made Depending on how you read that 40 percent estimate, it could be a bit misleading. This is a case where the models may be right, but not widely. The bill is expected to reduce emissions by 40 percent compared with 2005 levels — not comparable to current US emissions. That’s because emissions have already fallen significantly since 2005. Between 2005 and 2020, CO2 emissions fell by about 21 percent, thanks in large part to the switch from highly polluting coal to less polluting natural gas. (The COVID-19 pandemic also caused emissions to drop dramatically, as millions of cars and planes ground to a halt almost overnight.) Over the next eight years, emissions are expected to continue to slowly decline, thanks to cheap solar and wind power and a gradual shift to electric vehicles. Indeed, according to the same three modeling groups, by 2030, emissions are expected to drop by 24 to 32 percent — even without the CCA. That’s not to say the bill is without implications, of course. While it may not be as dramatic a change as it first seems, in a world where every extra ton of CO2 not emitted into the atmosphere can help limit global warming, an additional 10 to 15 percent reduction in emissions will help prevent serious environmental damage.

title: “The Ira Is Projected To Reduce Emissions By 40 . It S Not That Simple. Klmat” ShowToc: true date: “2022-11-10” author: “Willie Burgin”

The Inflation Reduction Act — the health care and climate bill signed into law by President Biden on Tuesday — marks the largest climate action the federal government has ever taken. With about $370 billion earmarked for clean energy, electric vehicles and carbon sequestration storage, the bill will certainly reduce the nation’s greenhouse gas emissions. The question is how much. The most popular number — the one repeated by the president, scientists and journalists — is 40 percent. In a statement released shortly after the deal was reached, Democratic Sens. Charles E. Schumer (N.Y.) and Joe Manchin III (W.Va.) claimed the new bill would, by 2030, cut emissions by 40 percent from 2005 levels. This figure was later supported by results from three independent sets of models. The Rhodium Group, an economics and energy research firm, estimated that the bill would reduce emissions by 31 to 44 percent by 2030. Energy Innovation, a climate think tank, projected a 37 to 41 percent reduction. and a group of researchers from Princeton University called the REPEAT project estimated a carbon dioxide reduction of about 42 percent. The agreement between the senators’ claims and the projections isn’t a surprise — modeling teams advised Capitol Hill staff about the deal’s potential implications before it was made public, said Jesse Jenkins, one of the leaders of Princeton’s REPEAT modeling program. This 40% figure will be repeated in international climate negotiations and presidential speeches for years to come. It marks progress toward the president’s climate goal — to cut emissions in half by 2030 — and may offer some hope to the millions of young people who have been drawn to climate action in recent years. But is it right? That depends — on how you measure and what you measure with. At the heart of these predictions are scientists’ highly complex models of how the economy works, including how energy is used, which can provide useful predictions about the future and always be somewhat inaccurate. As a popular modeling saying goes: “All models make mistakes. some are useful.” The energy models used by Rhodium, Energy Innovation and Princeton researchers are complex systems of equations, spreadsheets and data that attempt to represent all the energy used in the United States over a period of time. These models can estimate how many solar farms will be built once tax credits are in place to make them cheaper, or how many Americans will buy electric cars in the next 10 years. The fact that all three independent modeling groups produced similar findings is a good sign for the results. However, there are still reasons to believe that the reality could be different from what the models suggest the bill’s impact will be — or what the public would expect. On the one hand, models predicting a 40% reduction in carbon emissions may be overly optimistic. Jenkins, the Princeton engineering professor, says one of the biggest problems is predicting how quickly consumers, utilities and businesses will switch to clean technologies. “The biggest thing in our model that is an abstraction from the real world is the assumption that economic factors drive decision making,” he explained. The models assume that human beings are rational agents who base their decisions on costs and benefits. in the real world, this is not always true. This means that if it is cheaper to build a wind farm than a natural gas plant, or cheaper to buy an electric car than a natural gas car, the model predicts that more wind farms will be built and more electric cars will be bought. The REPEAT model currently predicts that all cars sold in 2030 will be electric vehicles, since by then EVs are projected to cost less than gas-powered cars. But in the real world, some consumers will be afraid to switch to electric vehicles even if they’re cheaper, simply because they don’t see enough car chargers in their neighborhoods. Similarly, wind farms and solar panels may be blocked by locals who find them unsightly to look at. Long-distance transmission lines, which would be needed to move renewable electricity from one state to another, could also be stymied by red tape. External economic factors could also slow the push away from fossil fuels. Ben King, associate director of climate and energy at the Rhodium Group and one of the authors of the group’s IRA analysis, says cheap fossil fuel prices and faster-than-expected growth could lead to a slower-than-expected projected shift to cleaner energy sources.

  1. There is potential upside There are also reasons to believe that 40 percent is one underestimate on the effects of the bill. Jenkins notes that none of the models can effectively predict technological progress fueled by government cash — for example, research and development funding that causes costs to fall for solar, wind, carbon capture and storage, or batteries. These cost changes, he argues, could cause the transition to clean energy to proceed even faster than expected—but are difficult to predict in an energy model. The models also do not attempt to predict any changes in state and federal policies. However, in the coming years, many states and cities are likely to implement new climate policies, such as requiring electricity to come from renewable sources or phasing out gas-powered vehicles. “This bill makes it cheaper for every other jurisdiction in the country to raise their ambitions and their policies,” Jenkins said. It would also make it easier for the Biden administration to impose tighter limits on emissions from cars and power plants — which in turn could reduce CO2 emissions even further. However, there is no “sure thing” in modeling. Emissions reductions from the IRA may be higher or lower than the 40% estimate. Right now, modelers can only make a best guess at how the future will play out. But, Jenkins argues, the result is not that different from estimates of the cost of the bill. Since clean energy IRA provisions consist primarily of tax credits, it is difficult to predict how many of these credits will ultimately be claimed and how much the bill will cost the government and taxpayers. “Forty percent is an imperfect estimate,” Jenkins said. “But I think it’s a pretty good estimate.”

  1. Progress has already been made Depending on how you read that 40 percent estimate, it could be a bit misleading. This is a case where the models may be right, but not widely. The bill is expected to reduce emissions by 40 percent compared with 2005 levels — not comparable to current US emissions. That’s because emissions have already fallen significantly since 2005. Between 2005 and 2020, CO2 emissions fell by about 21 percent, thanks in large part to the switch from highly polluting coal to less polluting natural gas. (The COVID-19 pandemic also caused emissions to drop dramatically, as millions of cars and planes ground to a halt almost overnight.) Over the next eight years, emissions are expected to continue to slowly decline, thanks to cheap solar and wind power and a gradual shift to electric vehicles. Indeed, according to the same three modeling groups, by 2030, emissions are expected to drop by 24 to 32 percent — even without the CCA. That’s not to say the bill is without implications, of course. While it may not be as dramatic a change as it first seems, in a world where every extra ton of CO2 not emitted into the atmosphere can help limit global warming, an additional 10 to 15 percent reduction in emissions will help prevent serious environmental damage.

title: “The Ira Is Projected To Reduce Emissions By 40 . It S Not That Simple. Klmat” ShowToc: true date: “2022-11-24” author: “Pedro Bourdeau”

The Inflation Reduction Act — the health care and climate bill signed into law by President Biden on Tuesday — marks the largest climate action the federal government has ever taken. With about $370 billion earmarked for clean energy, electric vehicles and carbon sequestration storage, the bill will certainly reduce the nation’s greenhouse gas emissions. The question is how much. The most popular number — the one repeated by the president, scientists and journalists — is 40 percent. In a statement released shortly after the deal was reached, Democratic Sens. Charles E. Schumer (N.Y.) and Joe Manchin III (W.Va.) claimed the new bill would, by 2030, cut emissions by 40 percent from 2005 levels. This figure was later supported by results from three independent sets of models. The Rhodium Group, an economics and energy research firm, estimated that the bill would reduce emissions by 31 to 44 percent by 2030. Energy Innovation, a climate think tank, projected a 37 to 41 percent reduction. and a group of researchers from Princeton University called the REPEAT project estimated a carbon dioxide reduction of about 42 percent. The agreement between the senators’ claims and the projections isn’t a surprise — modeling teams advised Capitol Hill staff about the deal’s potential implications before it was made public, said Jesse Jenkins, one of the leaders of Princeton’s REPEAT modeling program. This 40% figure will be repeated in international climate negotiations and presidential speeches for years to come. It marks progress toward the president’s climate goal — to cut emissions in half by 2030 — and may offer some hope to the millions of young people who have been drawn to climate action in recent years. But is it right? That depends — on how you measure and what you measure with. At the heart of these predictions are scientists’ highly complex models of how the economy works, including how energy is used, which can provide useful predictions about the future and always be somewhat inaccurate. As a popular modeling saying goes: “All models make mistakes. some are useful.” The energy models used by Rhodium, Energy Innovation and Princeton researchers are complex systems of equations, spreadsheets and data that attempt to represent all the energy used in the United States over a period of time. These models can estimate how many solar farms will be built once tax credits are in place to make them cheaper, or how many Americans will buy electric cars in the next 10 years. The fact that all three independent modeling groups produced similar findings is a good sign for the results. However, there are still reasons to believe that the reality could be different from what the models suggest the bill’s impact will be — or what the public would expect. On the one hand, models predicting a 40% reduction in carbon emissions may be overly optimistic. Jenkins, the Princeton engineering professor, says one of the biggest problems is predicting how quickly consumers, utilities and businesses will switch to clean technologies. “The biggest thing in our model that is an abstraction from the real world is the assumption that economic factors drive decision making,” he explained. The models assume that human beings are rational agents who base their decisions on costs and benefits. in the real world, this is not always true. This means that if it is cheaper to build a wind farm than a natural gas plant, or cheaper to buy an electric car than a natural gas car, the model predicts that more wind farms will be built and more electric cars will be bought. The REPEAT model currently predicts that all cars sold in 2030 will be electric vehicles, since by then EVs are projected to cost less than gas-powered cars. But in the real world, some consumers will be afraid to switch to electric vehicles even if they’re cheaper, simply because they don’t see enough car chargers in their neighborhoods. Similarly, wind farms and solar panels may be blocked by locals who find them unsightly to look at. Long-distance transmission lines, which would be needed to move renewable electricity from one state to another, could also be stymied by red tape. External economic factors could also slow the push away from fossil fuels. Ben King, associate director of climate and energy at the Rhodium Group and one of the authors of the group’s IRA analysis, says cheap fossil fuel prices and faster-than-expected growth could lead to a slower-than-expected projected shift to cleaner energy sources.

  1. There is potential upside There are also reasons to believe that 40 percent is one underestimate on the effects of the bill. Jenkins notes that none of the models can effectively predict technological progress fueled by government cash — for example, research and development funding that causes costs to fall for solar, wind, carbon capture and storage, or batteries. These cost changes, he argues, could cause the transition to clean energy to proceed even faster than expected—but are difficult to predict in an energy model. The models also do not attempt to predict any changes in state and federal policies. However, in the coming years, many states and cities are likely to implement new climate policies, such as requiring electricity to come from renewable sources or phasing out gas-powered vehicles. “This bill makes it cheaper for every other jurisdiction in the country to raise their ambitions and their policies,” Jenkins said. It would also make it easier for the Biden administration to impose tighter limits on emissions from cars and power plants — which in turn could reduce CO2 emissions even further. However, there is no “sure thing” in modeling. Emissions reductions from the IRA may be higher or lower than the 40% estimate. Right now, modelers can only make a best guess at how the future will play out. But, Jenkins argues, the result is not that different from estimates of the cost of the bill. Since clean energy IRA provisions consist primarily of tax credits, it is difficult to predict how many of these credits will ultimately be claimed and how much the bill will cost the government and taxpayers. “Forty percent is an imperfect estimate,” Jenkins said. “But I think it’s a pretty good estimate.”

  1. Progress has already been made Depending on how you read that 40 percent estimate, it could be a bit misleading. This is a case where the models may be right, but not widely. The bill is expected to reduce emissions by 40 percent compared with 2005 levels — not comparable to current US emissions. That’s because emissions have already fallen significantly since 2005. Between 2005 and 2020, CO2 emissions fell by about 21 percent, thanks in large part to the switch from highly polluting coal to less polluting natural gas. (The COVID-19 pandemic also caused emissions to drop dramatically, as millions of cars and planes ground to a halt almost overnight.) Over the next eight years, emissions are expected to continue to slowly decline, thanks to cheap solar and wind power and a gradual shift to electric vehicles. Indeed, according to the same three modeling groups, by 2030, emissions are expected to drop by 24 to 32 percent — even without the CCA. That’s not to say the bill is without implications, of course. While it may not be as dramatic a change as it first seems, in a world where every extra ton of CO2 not emitted into the atmosphere can help limit global warming, an additional 10 to 15 percent reduction in emissions will help prevent serious environmental damage.