Accelerating Decarbonization in the United States: Technology, Policy, and Societal Dimensions (2024)

Summary

When it passed in 2022, the Inflation Reduction Act (IRA) revolutionized U.S. climate and energy policy as the largest legislative action in the nation’s history to mitigate climate change, with anticipated public support for clean energy investments ranging from almost $400 billion to more than $1 trillion over the coming decade. The IRA is complemented by the bipartisan Infrastructure Investment and Jobs Act (IIJA, November 2021; more than $62 billion in appropriations for Department of Energy [DOE] climate and energy programs); CHIPS and Science Act (CHIPS, August 2022; $54.2 billion in appropriations for domestic semiconductor production and $170 billion in 5-year authorizations for research and development); and a number of executive orders and regulations from the Biden administration, including Executive Order (EO) 14008, which, among other things, established the Justice40 Initiative. As discussed in Chapter 1, these amounts are not necessarily additive considering that IRA, IIJA, and CHIPS do not use equivalent funding mechanisms. States, localities, and other entities have also enacted policies to advance deep decarbonization, such as California’s zero-emissions vehicles mandate and actions of state policy makers in Texas supporting the rapid growth of wind farms there. Most modeling analyses indicate that this policy portfolio will cause a dramatic shift in the trajectory of U.S. greenhouse gas (GHG) emissions and place the nation close to a 30-year path to net-zero emissions, but only if formidable challenges of innovation and implementation can be overcome and the policy portfolio produces as designed.

The stakes could not be higher. Most nations of the world have announced a goal of zero net GHG emissions by midcentury because of overwhelming scientific evidence that climate change is dangerous, and human caused. Annual global net emissions must decline to zero in approximately 30 years to keep Earth’s mean surface temperature from climbing above the Paris Agreement’s preferred target of 1.5°C (reaffirmed at COP 27 in November 2022), and in so doing prevent the most serious effects of accelerating climate change. The United States has the largest cumulative, and twelfth largest per capita, GHG emissions of any country, and the second largest annual emissions (after China), but until passage of the IRA, the United States was not at the vanguard of national actions to combat climate change.

Successful implementation of current U.S. policy would establish the nation as the international leader in the fight against climate change and would be vital to achieve global emissions reductions. The policy portfolio also has additional objectives that reach far beyond climate mitigation. It is intended to improve the lives of ordinary people by increasing the number of high-paying domestic jobs, increasing U.S. economic competitiveness, revitalizing our energy and industrial sectors, eliminating the environmental injustices in our current energy system, putting a fair and equitable system in its place, and improving people’s health.

This report offers an assessment of what current federal, state, and local climate and energy policies could accomplish, together with actions and implementation by the private sector and civil society. It focuses specifically on gaps in the current policy portfolio and barriers to implementation that would prevent the nation from attaining its climate, economic, and humanistic goals. The report offers additional policies that could fill gaps and overcome barriers, most of which could be implemented under existing federal legislation through actions by the executive branch and/or state and local governments, although some would require Congress. Significant gaps and barriers are to be expected because nothing of this scale and with this diversity of goals has ever been attempted. Watching for and, over time, filling those gaps will be essential to overall success.

The economic opportunities of a transition to net zero stem largely from recent revolutionary changes in the cost of technologies and equipment that are not fueled by fossil energy. From 2010–2021, the levelized cost of energy for onshore wind and utility-scale solar dropped by nearly 70 and 90 percent respectively, to become cost-competitive with or cheaper than new fossil power projects over most of the globe. As a result, by the early to mid-2030s, the United States could rely on wind and solar electricity generation, together with existing hydro and nuclear assets, to supply at least 80 percent of the country’s electricity demand at inflation-adjusted retail costs similar to today. Technological options also are in advanced development to eliminate emissions from the last 20 percent of power supply, using technologies such as advanced nuclear power, batteries and other energy storage technologies to manage long-term fluctuations in demand, natural gas with carbon capture and storage (CCS), and green hydrogen or biogas combusted in turbines. However, realizing the potential of these dispatchable power options will require relentless research, development, demonstration, and deployment (RDD&D); public engagement; and learnings at scale after deployment.

Over the same 11 years, electric vehicle (EV) lithium-ion battery packs dropped in cost by approximately 80 percent, and the price of lithium-ion batteries for all applications fell by 98 percent between 1991–2018 as they migrated from consumer electronics to packs

storing more than 100 kWh of electricity in battery electric vehicles (BEVs) (enough to drive more than 300 miles in a passenger vehicle). Dramatic cost reductions in batteries have made BEVs cost-competitive with new light- and medium-duty vehicles powered by internal combustion engines (ICEs). The average cost of owning and operating a light-duty BEV is likely lower than comparable ICE vehicles for some models and will be for most over the next 5 years (2023–2028) depending on vehicle class and other factors.

Thus, within the same decade, the cheapest options for new equipment in two sectors responsible for approximately 70 percent of U.S. CO₂ emissions—power generation and motor vehicles—are switching from being fossil-fuel powered to non-emitting alternatives. Decarbonized electric power, together with ongoing improvements of heat pumps and generally improving energy efficiency, also unlock the potential for emissions-free buildings. Using data even a few years old could lead to claims that the energy transition would be prohibitively expensive, as those data would not reflect current costs given their rapid recent descent.

This technological revolution converged with two other trends to convince elected officials of the need for immediate action. First, climate change–induced increases in the frequency and severity of extreme weather became obvious even to casual observers, and climate activism flourished against the backdrop of immediate and personal dangers that could be mitigated by cost-effective measures. Second, while these technological, scientific, and political changes were taking place, the United States was confronting with renewed vigor the consequences of its history of discrimination and the ongoing systemic problems that persist because of it. The U.S. energy system today contains considerable environmental injustice, such as the disproportionate exposure to fossil-produced air pollution that afflicts communities of color, with some of this owing to overtly racist policies like redlining during the 20th century and discriminatory and predatory lending and investment practices that continue today.

These issues have sharpened the goal, from a 30-year transition to net-zero emissions, to a fair, equitable, and just 30-year transition. In January 2021, the Biden administration established the Justice40 Initiative as official U.S. policy, which states that people and “disadvantaged communities that are marginalized, underserved, and overburdened by pollution” receive 40 percent of benefits from some federal investments in climate change, clean energy, energy efficiency, transit, affordable housing, workforce development, and remediation and reduction of legacy pollution.¹ The congressional framers of the IRA followed suit, by directing up to $60 billion of IRA funding to environmental justice priorities.

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¹ For more information on the Justice40 Initiative, see https://www.whitehouse.gov/environmentaljustice/justice40.

Thus, both the stakes of success and the costs of failure are high. The United States is attempting the first fair, equitable, and just technological transition in its history with a narrow portfolio of policies that relies extensively on subsidies. If successful, the transition will affect almost every part of the U.S. economy and leave the country with an affordable and accessible energy system that produces zero net GHG emissions. It will also afford important co-benefits, such as reduced emissions of ambient air pollutants that cause illness and death; revitalized energy, building, and industrial sectors; increased resilience to environmental and social stressors; net increases in employment; and fair, equitable, and just treatment of both displaced fossil fuel workers and low-income and historically marginalized populations.

This is the second report from a National Academies of Sciences, Engineering, and Medicine committee that was constituted in 2020 to address “societal, institutional, behavioral, and equity drivers and implications of deep decarbonization.” (See the statement of task in Box 1-1 of Chapter 1.) The committees that wrote the first and second reports shared a majority of members and had an approximately equal number of experts in energy technologies as in policy and the social science of energy policies, including policies affecting equity and energy justice. The committee was tasked to examine how the nation might achieve an equitable transition to net zero, not whether it should do so. The committee also was not tasked to assess policies designed to address impacts of climate change. The motivation for the focus on equity, fairness, and justice is at least partly pragmatic, given the need to maintain public and political support during a transition that will affect every part of society. Inclusive and equitable approaches, moreover, are key to preempting or minimizing implementation challenges that would delay or derail decarbonization projects.

SUMMARY OF FIRST REPORT

The first report, Accelerating Decarbonization of the U.S. Energy System,² was released in February 2021 and focused on federal actions needed during the 2020s to put the nation on a fair and equitable path to decarbonization by midcentury. It identified “no-regrets” actions during this first decade of a transition to net-zero emissions that would be robust to uncertainty about the system’s final technological mix. It outlined a set of technological and socioeconomic goals to support a just and equitable transition that are robust to alternative future technology options. On the technology side, the committee set goals for carbon-free electricity; electrifying transportation, buildings, and industry; investing in energy efficiency and productivity; deploying critical

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² See National Academies of Sciences, Engineering, and Medicine, 2021, Accelerating Decarbonization of the U.S. Energy System, Washington, DC: The National Academies Press, https://doi.org/10.17226/25932.

infrastructure; and expanding the innovation toolkit through clean energy research, demonstration, and deployment. The committee’s socioeconomic goals were to strengthen the U.S. economy; promote equity and inclusion; support communities, businesses, and workers; and maximize cost-effectiveness.

The committee recognized that a strong social contract would be essential to maintain support for an energy transition covering 3 decades. Thus, it proposed policies “to build a more competitive U.S. economy, to increase the availability of high-quality jobs, to build an energy system without the social injustices that permeate the current system, and to allow those individuals and businesses that are marginalized today to share equitably in future benefits.” The diverse portfolio of policy recommendations called for both system-wide and sector-specific policies that establish the U.S. commitment to a rapid, just, and equitable transition; set rules and standards for technology planning and deployment; invest in research, technology, people, and infrastructure; and assist and build capacities for families, businesses, communities, cities, and states to ensure that disadvantaged communities do not suffer disproportionate burdens. The committee continues to endorse the goals and policies recommended in the first report, while acknowledging that the list of new policies needed today is fundamentally shaped by the radical changes to the policy landscape since its publication. Table 1-1 in Chapter 1 compares the policies recently adopted with the recommendations in the committee’s first report.

SUMMARY OF CURRENT FEDERAL CLIMATE AND ENERGY POLICY

The extensive decarbonization policy portfolio that the United States has today did not come together until the summer of 2022 with the passage of the IRA and CHIPS, which complement the IIJA passed in November 2021. The potential impacts of these three pieces of legislation are nothing short of transformative for the energy sector and technology innovation in general. They lay out an expansive domestic industrial policy that puts climate, innovation, manufacturing, and wealth creation across all parts of the nation and economy as a central mission. Combined with the aspirations of related executive orders, this package seeks to develop a more equitable, fair, and just framework for the energy system transition.

Of the three pieces of legislation, the IRA contains by far the most significant and wide-reaching policies to decarbonize the U.S. economy. It provides incentives for purchasing, producing, developing, and deploying clean energy technologies and makes investments in environmental justice and low-income and historically marginalized communities. Modeling studies estimate that successful implementation of the act would put the United States on track to achieving 70–80 percent of the

emissions reductions necessary to reach its 2030 emissions target of ~3.3 Gt CO₂e (50–52 percent below 2005 emissions levels) along a trajectory to its midcentury net-zero goal.

CHIPS incentivizes domestic research, development, and manufacturing of semiconductors used in clean energy and a broad range of other modern technologies. It further boosts the country’s leadership in science and technology by authorizing investments in research and development, workforce training, and commercialization of a wide range of technologies. These include not only advanced energy technologies but also artificial intelligence, quantum computing, and biotechnology engineering that will impact decarbonization in unexpected ways. CHIPS recognizes the need to diversify the innovation ecosystem by authorizing the creation of regional technology hubs and increasing opportunities for disadvantaged students and communities.

The IIJA is designed to improve roads, bridges, and other components of the nation’s aging infrastructure. It is wide-ranging and often future-leaning in its scope by expanding broadband; providing grants for battery manufacturing and recycling facilities; investing in carbon capture, transport, utilization, and storage infrastructure; and deploying EV charging stations, in addition to repairing roads and bridges. While some of these investments may run counter to decarbonization goals in the near term, the legislation establishes regional clean hydrogen and direct air capture hubs, which will provide critical learning as the country takes on the challenges of harder to decarbonize energy uses within industry and transportation in the 2030s. The IIJA further solidified the role of the Department of Energy (DOE) in moving beyond its traditional focus on research, development, and early-stage demonstration to latter-stage demonstration, deployment, and commercialization.

In addition to legislation, other federal actions support the nation’s clean energy, equity, and climate priorities. Within days of entering office, the Biden administration issued EO 14008 focusing on steps that the federal government can take both domestically and internationally to address the climate crisis. Importantly, it made Justice40 official U.S. policy and established the Interagency Working Group (IWG) on Coal and Power Plant Communities and Economic Revitalization, recognizing the need to support coal mining and power plant workers and communities in the energy transition. Justice40 and the IWG, together with the equity, justice, and fairness provisions in the IRA and other executive orders, represent a step change in equitable energy and climate policy. In response, federal agencies have created new offices and hired staff focused on energy justice and equity. Other executive orders and regulatory actions have targeted federal procurement power as a catalyst for developing a domestic clean energy economy, fuel economy and GHG standards for light- and medium-/heavy-duty vehicles, and emissions standards for existing and new fossil-fueled power plants and industrial facilities.

SECOND REPORT

In early 2021, it became clear that the 117th Congress was likely to enact significant new climate and energy legislation before the release of the committee’s second report. For the second report to be relevant and useful under this scenario, the assessment of “a wider spectrum of technological, policy, social, and behavioral dimensions of deep decarbonization” called for in the statement of task would need to address whatever path to “deep decarbonization” had been chosen by Congress and the administration. The committee spent the next 18 months preparing the foundation for an analysis of a comprehensive federal policy portfolio, and then the past 8 months completing a draft report for the portfolio that is now federal law. The committee subsequently submitted the report for a comprehensive external review and has modified the analysis as needed to reflect reviewer comments and updates to policy, regulations, and other climate-related actions. Also, given the first report’s focus on federal action, the committee examined the contributions of states, localities, the private sector, and civil society to mitigating climate change.

The committee identified five objectives of decarbonization policy—GHG emission reductions,³ equity and fairness, health, employment, and public engagement—and eight sectors—electricity, buildings, land use, transportation, industry, finance, fossil fuels, and non-federal actors. This report has chapters focused on objectives that cut across sectors, and chapters on the sectors that cut across objectives (think of a matrix, with objectives as rows and sectors as columns). Although this structure entails some redundancy, it facilitates understanding by specialists who may read only part of the report. It also helps emphasize the crosscutting and systems-level characteristics of deep decarbonization. Sectoral chapters support the interests of sectoral specialists, while also sharing with them that many daunting sectoral barriers are likely to be social and cultural, such as the development of public resistance to a process that seems unfair, unequitable, or unjust. Chapters on objectives are tailored to the interests of social scientists, environmental justice activists, and others who are interested in the fairness of the transition; its impacts on equity, justice, health, and employment; and the need for effective public engagement, while confronting them with myriad practical, technical, institutional, and legal constraints that cannot be ignored. A prime example of the latter is the fact that a minimum amount of electricity production must be dispatchable, which means that one can turn it on whenever needed in order to meet the demands of a complex economy and just society, even during conditions when the winds are quiet, the skies are hazy, and the temperatures are extreme for several consecutive days.

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³ This report primarily covers CO₂ emissions, with some discussion of non-CO₂ GHGs where relevant.

After passage of the IRA, IIJA, and CHIPS, it was clear from their budgets, comprehensive sectoral coverage, and narrow policy portfolio that the dominant risk to achieving the maximum possible emissions reduction is inadequate or failed implementation. Congressional passage significantly reduces the political risk of repeal, while the focus on low-carbon electricity and electrification during the 2020s, which already costs less than new emitting fossil alternatives, largely puts off the risk that essential non-emitting technologies might not be ready in time at the right price until after 2030. Hence, the committee’s second and final report is not just about progress but also about gaps and barriers that would prevent successful implementation, where success is measured against the five separate objectives: reduced emissions of GHGs; fairness, equity, and justice; health; the number and quality of jobs; and transparent public engagement in planning and decision-making. For each gap and barrier, the report offers a recommended remedy.

Recommendations Summary⁴

A summary of approximately 80 recommendations is provided in Table S-1, with a list of the actors responsible for implementation and the sectors and objectives that each is designed to address. Recommendations are also sorted into 10 broad categories that are described below.

A Broadened Policy Portfolio. The committee’s first report recommended a broad set of policies, including taxes, standards, and incentives, with some redundancy to make the portfolio more robust to the failure or repeal of any one component. For example, manufacturing standards for home heating appliances would ensure a transition to heat pumps even if the carbon tax proved unable to overcome consumer inertia. The narrow policy portfolio in the IRA, IIJA, and CHIPS—exclusively tax incentives and other subsidies, with the exception of a fee for fugitive methane emissions—lacks the backstops of a diverse portfolio and thus makes achieving its emissions reduction goals more uncertain. Also, a 30-year transition will require that some critical elements possess the political durability that only congressional action can provide. Recommendation 1-1 repeats two recommendations for Congress from the first report: a national GHG emissions budget and an economy-wide carbon tax with provisions to protect people with low incomes and energy-intensive businesses exposed to import competition. The committee fully appreciates the political headwinds currently facing these actions. Within the body of the current report, the committee also reiterates recommendations from its first report for clean energy standards for electricity, zero-emissions vehicle sales mandates, zero-emissions appliance standards, and the

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⁴ The text in this section was changed during editorial review to improve clarity and alignment with information in other sections of the report.

creation of a National Transition Corporation. Recommendations in Table S-1 that would broaden the federal policy portfolio include 1-1, 5-3, 5-8, 6-1, 7-5, 7-7, 8-2, 8-6, 8-8, 9-1, 9-3, 10-2, 10-3, 10-6, 10-7, 10-9, and 12-2.

Rigorous and Transparent Analysis and Reporting for Adaptive Management. Few of the policies in the IRA have ever been implemented at the scale and pace required by the law and necessary to achieve climate mitigation goals, while also ensuring energy justice and equity. Federal agencies and, especially, state governments currently lack the capacity needed to administer the funds and implement programs. State and local motivations behind implementation are highly heterogenous, with some areas energetically supportive and others opposed. Overt or passive public resistance to the deployment of critical infrastructure could materialize in some locations or sectors. The climate and energy programs in the IRA and IIJA are scattered across the federal government, with no durable entity to gather data, monitor, and analyze them and periodically report on progress against GHG emissions, equity, justice, employment, health, and public engagement goals. This will limit the nation’s ability to learn what works and what does not, to course-correct, and to design effective policies for the subsequent 2 decades of the transition. Recommendations 1-2 and 1-3 are for Congress to designate an enduring entity to oversee and execute rigorous and transparent data analysis, monitoring, and reporting about investments and progress, in much the same way that the U.S. Global Change Research Program (USGCRP) was empowered by Congress to report periodically on climate change and its impacts. Other recommendations that support Recommendations 1-2 and 1-3 include 2-1, 2-2, 2-3, 2-6, 3-2, 7-1, 7-3, 7-5, 8-1, 8-3, 8-4, 9-5, 10-1, 10-5, 10-6, 10-7, 11-4, and 11-5.

Ensuring Procedural Equity in Planning and Siting New Infrastructure and Programs. The social sciences and technical literature on planning and developing new infrastructure during technological transitions shows that public consensus and support require a careful collaborative process managed by specially trained people, and with active participation by the diversity of people in the local community. It is also important to involve affected publics in planning for energy development early, rather than coming to them with fully baked project proposals. Without robust process, policy implementers may lose or fail to gain the trust of a local community before learning what its members want and would support. Communities are then left opposing infrastructure like community solar, which could pay them revenue, reduce energy bills, or even be owned by them, because they (understandably) do not trust the people or process that promotes it, rather than deciding based on the advantages and disadvantages for their community. Although robust public process takes time, it increases the probability of success; there is some evidence that good process yields trust and awareness that can facilitate subsequent siting in the same location.

Recommendations 5-1 through 5-8 would implement this process, with support from 2-3, 2-4, 2-5, 6-6, 7-1–7-3, 9-5, 11-1–11-3, and 12-1.

Ensuring Equity, Justice, Health, and Fairness of Impacts. The current federal policy portfolio contains many provisions designed to ensure a fair, just, and equitable distribution of costs and benefits from the transition, and to eliminate current injustice in our energy system. Recommendations 2-1 through 2-6 are designed to strengthen these provisions and reduce barriers to their successful implementation. The report also recommends that Justice40 or an equivalent target be made durable (institutionalized) through an act of Congress (Recommendation 2-1). Public health is a critical component of justice and fairness in many parts of the energy transition. Perhaps the single gravest environmental injustice in the U.S. energy system is that up to 355,000 deaths per year are caused by air pollution from fossil fuels combustion, which disproportionately occur in communities of color and low-income households. A large fraction of this pollution will be eliminated by actions stimulated by the IRA during the 2020s because of coal plant closures. This will make a significant down payment on Justice40, above and beyond the funding in the law that is directed explicitly to environmental justice. Recommendations 3-1 through 3-3 would make sure that health impacts are assessed when technological and new infrastructure decisions are made, and Recommendation 10-4 would promote development of technologies that reduce both CO₂ and co-pollutant emissions. Last, Recommendations 4-2, 4-3, 5-2, 5-4, 5-8, 6-4, 6-5, 9-5, 9-6, 10-4, 12-1, 12-3, 12-6, and 12-7 would mitigate the harms to workers and communities from the loss of fossil-dependent jobs.

Siting and Permitting Reforms for Interstate Transmission. Perhaps the single greatest risk to a successful energy transition during the 2020s is the risk that the nation fails to site, modernize, and build out the electrical grid. Except where new transmission has been shown as needed to keep the lights on, adding transmission is complicated by the need to secure cooperation from numerous individual landowners and affected publics—many of whom may perceive greater cost than benefit from high-voltage transmission lines. The need for adding new transmission capacity and pathways during the 2020s is unprecedented, given the committee’s goal of at least 75 percent clean power by 2030, laid out in the first report. Studies show that without significant new transmission capacity, renewables deployment would be delayed, just as electrification of transport and heating are starting to increase demands for power. The net result could be increased generation by fossil electricity plants and increased national fossil emissions during the 2020s, which would make the entire effort appear to be a failure, even assuming that investments in energy efficiencies occur in conjunction with electrification. This would also prolong and increase the environmental injustice of exposure to dangerous particulate emissions from fossil power plants.

Expansion of the high-voltage interstate transmission grid is needed in addition to, rather than instead of, modernization of local electricity distribution systems, deployment of energy resources (such as solar and storage) close to customers, and much more aggressive adoption of energy efficiency. The committee recommends siting and permitting reforms through the collection of executive, state, and private-sector actions in Recommendation 6-2 with support from Recommendations 5-5–5-7, 6-3–6-6, and 7-6.

Tightened Targets for the Buildings and Industrial Sectors and a Backstop for the Transport Sector. The 2030 sectoral emissions goals set by the Biden administration can be achieved or mostly achieved by the current policy portfolio, in part because the goals for “harder-to-decarbonize” sectors, such as industry and buildings are not particularly stringent. Recommendations 7-1 through 7-5 would facilitate effective implementation of components of the IRA and the IIJA directed at buildings and the built environment, especially those that would further equity and fairness objectives. Chapter 7 also includes 10 technically achievable actions in buildings and the built environment that could eliminate up to 1 billion metric tons of today’s CO₂ emissions per yer, mostly by increasing energy efficiency and decreasing demand for energy services. Although several of the actions would face formidable political headwinds if proposed today as new federal policies, most could be implemented by states, municipalities, and property owners. By increasing energy efficiency, these actions would decrease current and future demand for electricity, which would ease the pressures to site new transmission, distribution, and generation capacity so quickly. In the transport sector, the Biden administration has set a goal for zero-emission vehicles (ZEVs) to comprise 50 percent of 2030 sales. Because of uncertainties about the pace of deployment of charging infrastructure and consumer adoption of ZEVs, some published analyses predict that the 2030 goal will be achieved, while others predict a significant shortfall. Recommendation 9-1 calls for federal executive action to establish a ZEV standard to backstop the tax credits in the IRA, while Recommendations 9-2 through 9-5 call for state, local, and private actions to promote the growth of ZEV sales. Recommendations 10-1–10-4, 10-6, 10-7, and 10-9 call for specific congressional actions to accelerate decarbonization of the industrial sector. These might attract bipartisan interest as part of a package to revitalize U.S. industry. The less ambitious emissions reduction goals for the buildings and industrial sectors in the 2020s mean that large reductions will be required after 2030. In addition, large atmospheric CO₂ removals in the 2040s will likely be needed from technologies, like direct air capture, that are unproven at a commercial scale.

Managing the Future of the Fossil Fuel Sector. The committee’s first report concluded that, in the 2020s, approximately the same actions are required in scenarios

that assume exclusively renewable sources in 2050 as in those that assume a mix of renewables, nuclear power, and fossil energy with carbon capture and storage. For this reason, the fact that the IRA, IIJA, and CHIPS include incentives for non-renewable options does not significantly take any decarbonized technology option off the table. Most estimates indicate a continued role for fossil fuels—particularly oil and gas—in meeting energy demand throughout the next decade but significant uncertainty in the 2030s and beyond. Recommendations 12-1, 12-3, and 12-5–12-7 would help manage some consequences of these demand reductions, including safe operation of municipal gas distribution networks despite a declining base of rate payers, reforms to taxes on petroleum products, remediation of abandoned fossil facilities, and transition planning and assistance for communities and states now heavily dependent on fossil extraction and production. Recommendations 12-2 and 12-4 would avoid investments that are not essential to meet current demand and might end up excluded from the final net-zero mix.

Building the Needed Workforce and Capacity. The federal government is rapidly adding the capacity it needs to implement current climate and energy policy. However, the nation as a whole lacks the trained workers needed to implement fairness, equity, justice, and public engagement provisions. Implementation of Recommendations 2-4, 5-1, 5-6, 5-9, 5-10, 7-4, and 7-5 would supply the needed training. Recommendations 4-1–4-4, 10-8, and 12-1 would provide training for workers needed by decarbonized industries and retraining for current fossil fuel workers. Last, Recommendations 13-1–13-5 are needed to remedy the severe capacity shortage in most subnational governments, which will be responsible for administering most of the programs in current policy.

Reforming Financial Markets. The financial sector directs the flow of capital and financial services to businesses and households throughout the United States and has increasingly focused on the risks and opportunities associated with the net-zero transition. Historically, some communities have not had equal access to these services, an inequality that the energy transition must address. Targeted programs can address these inequities, and Recommendations 11-1 through 11-3 focus on this outcome. Additionally, better data and information can allow investors and regulators to fully understand climate-related risks and opportunities in the financial sector, and Recommendations 11-4 and 11-5 aim to improve and standardize data collection and disclosure. Last, financial regulators need to improve their monitoring and supervision of climate risks, and Recommendation 11-6 addresses needed scenario analysis and stress testing to understand the vulnerability of key financial institutions and the sector as a whole.

Research, Development, and Demonstration Needs. DOE is implementing many of the new or expanded RD&D programs required in the first decade of a transition to net zero, so that the nation will be ready for the second 2 decades. However, additional investments will be required to address medium- to long-term challenges, such as developing new methods to make low-carbon products using green chemistry or engineering. Furthermore, the breadth of the energy transition requires an RD&D portfolio broader than DOE’s domain, including for example land-use practices that store carbon while improving agricultural productivity, research on artificial meat and dairy food products, and ways to reduce food waste and shift toward more plant-based diets. In general, the most formidable barriers to successful implementation are not just technical, but rather within the domain of the social sciences, where DOE and the federal government investments have historically been small or absent. Recommendation 5-9 would greatly enhance investments in energy-related social sciences, while 3-3, 6-7, 7-6, 8-4, 8-5, 8-7, 9-6, 10-1, 10-2, 10-4, and 10-6 would fill specific technological gaps in RD&D, which in some cases (e.g., for land-use-related approaches) will require identifying which technologies to pursue and how.

TABLE S-1 Summary of Recommendations for Policies Designed to Meet Net-Zero Carbon Emissions Goal and How the Policies Support Specific Sectors, Objectives, and Overarching Categories

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