The U.S. power sector's significant reduction of greenhouse gas emissions from electricity generation over the past 15 years is an indication of what bolder efforts can be achieved by other economic sectors. But reaching economy-wide net zero carbon emissions comes with costs, challenges and uncertainties, researchers, power system analysts, utilities and the business sector agree.

Carbon dioxide (CO2) emissions from electricity generation in 2020 were about half the projections made in 2005 and 40% below actual 2005 levels, according to a Department of Energy (DOE) April 2021 study. But economy-wide net zero emissions (NZE) by 2050 will require a transition to electrification and clean energy for transportation, building, and various industrial sectors at unprecedented scale and speed, along with support from still-unproven or even undiscovered technologies to eliminate or offset all CO2, other studies and private sector observers said.

"The first step in reducing emissions is avoiding their increase, but the U.S. actually lowered power sector emissions in the last two decades, which has clarified the roadmap" to Biden administration economy-wide NZE goals by mid-century, said Ryan Wiser, Lawrence Berkeley National Laboratory (LBNL) senior scientist and study lead author. But achieving the administration's goals will require technology advances and new policy levers to achieve "a scale-up the likes of which we have not historically observed."

The 2020s must be about deployment of renewables, storage, transitioning away from older coal assets, and evolving operations to integrate intermittency, agreed Edison Electric Institute (EEI) General Counsel and Senior Vice President of Clean Energy Emily Fisher. Carbon-Free Technology Initiative work shows "we will need new technologies after 2030 to keep the grid reliable and affordable, but we don't know what engineers and scientists will develop yet," Fisher said.

The initiative involves nine groups, including EEI, the Nuclear Energy Institute and the Bipartisan Policy Center. It "focuses on policy recommendations to advance key technology areas...[and supports] the creation of the domestic supply chain needed to deploy advanced clean energy technologies."

The next step toward economy-wide NZE by 2050 will require "an estimated $2.5 trillion investment" in today's technologies and in unproven technologies that offer optional potential pathways to emissions cuts in the 2030s, according to Princeton University Postdoctoral Research Associate Erin Mayfield, a co-author of Princeton's comprehensive Net Zero America study.

That next step's options are for future NZE solutions in baseload power along with transportation, building and industrial electrification, LBNL, Princeton and others' research shows. Investment decisions of great concern to utilities and other businesses must be made among the many types of still emerging technologies and fuels, ranging from advanced battery storage and nuclear to green hydrogen, and solutions remain uncertain, researchers and industry groups said.

The meaning of halfway

Emission numbers in 2020 were impacted by the economic slowdown from the COVID-19 pandemic, but CO2 reductions over the past 15 years have been driven by "economic, technical and policy factors," LBNL said. Energy efficiencies lowered electricity demand 24% below projections. Renewables grew 79% more than projected. Natural gas use increased 112%, but coal and oil generation in 2020 was 70% below 2005 projections.

"Big changes in carbon emissions trajectories happened quickly but past performance is no guarantee of future results, and it should not trivialize the challenges that remain" for getting to economy-wide NZE, LBNL's Wiser said.

At least 51 major utilities have made NZE-by-2050 commitments, according to the Smart Electric Power Alliance. But they have concerns about achieving them.

Xcel Energy was "the first major U.S. power provider" to commit to "100% carbon-free electricity" by 2050, Xcel spokesperson Julie Borgen said. It expects to reach its interim 2030 goal to reduce CO2 80% from 2005 levels using today's resources, but "the final 20%" will require "new carbon-free, dispatchable technology."

By 2020, Southern Company had reduced its emissions 52% from 2007 levels and transformed its 2007 energy mix of 69% coal and 1% renewables to 17% coal and 15% renewables, Southern spokesperson Schuyler Baehman said. But reaching greater emissions reductions will require new policies and innovations, he said.

San Diego Gas and Electric Vice President for Energy Procurement and Sustainability Estela de Llanos, Northern Indiana Public Service Company spokesperson Tara McElmurry and Tennessee Valley Authority spokesperson Scott Fiedler all reported significant emissions reductions and similar uncertainties about future policies and technologies.

Customer demand and the 50% to 52% economy-wide greenhouse gas emission reductions by 2030 pledged April 22 by President Joe Biden are driving the utilities' efforts, their representatives said. The administration's NZE by 2050 ambition is equally important to their concerns about the uncertainties, they added.

The utilities' concerns could be due to a lack of real commitment, but the uncertainty is genuine, according to a January 2021 Sierra Club paper.

The "reality is that NZE goals must be considered aspirational," said Christoper Guith, senior vice president at the U.S. Chamber of Commerce's Global Energy Institute. As the Chamber's recent letter to Congress indicated, "the overwhelming scientific consensus is that getting beyond 75% to 80% decarbonization will require development of advanced storage, advanced nuclear, and new carbon capture technologies."

Reaching NZE by 2050 "will require doubling 2020's record-setting 30-plus GW annual renewables growth, maintaining that pace, and finding new technologies and policies," Wiser said. "For now, the focus is a 50% economy-wide emissions reduction by 2030," he added.

Going deeper

Existing resources and increasingly cost-competitive new solar, wind and energy storage will allow the power sector to go deeper on decarbonization in the near term, LBNL said. Over half the estimated 1,100 GW of new renewables needed to get to NZE by 2035 is in development, including roughly 660 GW of wind and solar and 200 GW of storage, it reported.

"But for economy-wide emissions reductions by 2030 and beyond, other sectors, including buildings, transportation and industry, will have to play a more significant role," LBNL's Wiser said. EEI's Fisher and the Chamber's Guith agreed.

The first key will be accelerating power sector reductions, Energy and Environmental Economics Director Tory Clark told an April 15 Resources for the Future (RFF) webinar. She and other researchers detailed other technologies and policies needed for 50% economy-wide emissions reductions by 2030 and an NZE economy by 2050.

Researchers generally agree the Biden 2030 goal "is feasible but difficult because action is needed from all sectors," RFF Fellow and Director of the Carbon Pricing Initiative Marc Hafstead told the webinar, citing projections from the Energy Information Administration. "But the cleaner we get the electricity sector now, the more opportunities there will be for other sectors beyond 2030."

It is important to set ambitious goals now, added Leon Clarke, research director at the University of Maryland School of Public Policy's Center for Global Sustainability. Ambitious accomplishments now in all sectors of the economy will show their importance "when the lifting gets heavier" with bigger advances in electrification. 

Emissions-capturing fuel production processes, fuels made from renewables like green hydrogen, and zero-emissions refrigerants and other industrial products will be needed to reduce emissions, especially in heavy transportation and industry, Clarke said. And new approaches to offsetting emissions will be needed in agricultural and forest soils management, reforestation, and wildfire mitigations to reduce overall emissions.

Policy should aim to align economic drivers, institutional objectives, customer benefits and new job creation with NZE goals, he said. And development of transportation and building electrification technologies sooner can avoid the need for more expensive strategies and programs later, he added, confirming Hafstead's point.

Policy that stresses flexibility is equally important in the Biden 2030 commitment, Evolved Energy Research Co-Founder Ryan Jones, another contributor to the Princeton Net Zero America research, told the RFF webinar. "A 47% economy-wide emissions reduction by 2030 is possible at a cost of about $60 billion per year, if everything goes right, but flexibility on getting to that last 3% in the near term might avoid unnecessary cost and distraction from steps needed now for future reductions."

Requirements that drive new biofuels infrastructure to meet near term light duty vehicle emissions reduction goals or new natural gas plants to meet near term resource adequacy needs are examples, he said. Those technologies could become stranded assets as new solutions emerge, he cautioned. The resulting "inertia of infrastructure turnover" could impede development of those new solutions more suitable for the 2040s, he said.

"Other economic sectors should not wait for the power sector to get to NZE because innovations in other sectors could make the transition more affordable for everybody," EEI's Fisher added. "The power sector will be focused on managing costs because if electricity is too expensive, it will delay progress and we cannot afford to let that happen."

Next steps and new challenges

Princeton's Net-Zero America report is the most comprehensive and detailed mapping in time and by location for economy-wide NZE in 2050, LBNL's Wiser and presenters at the RFF webinar agreed.

The two-year study is a granular assessment of critical factors like energy technologies, infrastructure, capital investment, employment, and land uses, Princeton's Mayfield said. Its Evolved Energy Research-developed "macro energy system model" optimized total system costs over the life of the coming transition to identify the key changes needed to make NZE possible and affordable.

With "historically unprecedented rates" of technology and infrastructure deployment, "impacts on landscapes and communities" must be "mitigated and managed" to "sustain political commitment," the report said. And "large amounts of risk-capital" must come from public and private sources to drive significant transportation and building electrification investments.

In addition, industry must turn to electricity with green hydrogen or other low carbon processes to achieve NZE and 2020s electrification technologies must be expanded to use throughout the economy in the 2030s, the Princeton report said. Finally, technologies and "critical enabling infrastructure" must be fully deployed and new options like advanced nuclear or carbon capture that might be needed for the 2040s must be proven.

All "realistic, real-world assessments" of economy-wide NZE by 2050 are built on six "pillars," the Princeton reseachers reported. The first is energy efficiency and electrification, the second is wind and solar with transmission and storage, the third is bioenergy and other zero-carbon fuels, the fourth is carbon capture and storage, the fifth is reduced non-carbon emissions, and the last is land sinks to sequester carbon.

These would be key across any of the five "technological pathways" modeled in detail by the Princeton researchers. They are intended to shift the question about NZE by 2050 "from 'if' to 'how,'" according to the report website.

Utilities and business groups see the needed advances in this same range of technologies, EEI's Fisher and the Chamber's Guith said.

Princeton's five pathways include a scenario with high electrification and few constraints on land for renewables and one with less access to electrification but few other constraints, the report said. Another uses more biomass fuels instead of electrification, a fourth models "nearly full electrification" of the economy but with less renewables growth, and the last is 100% renewables.

Costs and benefits

Given the current political resistance for investments simply to upgrade today's infrastructure, the cost for NZE could be the big question. 

The $2.5 trillion in needed investments through 2030 is "nearly identical" for all five Princeton pathways to NZE, Mayfield said.

For each, about 50% of the $2.5 trillion would go to power sector investments in renewables and transmission, about 30% is from consumer investments in vehicles, buildings and appliances, about 10% is from industry's investments to cut emissions, and the remaining 10% is from public and private sector economy-wide investments in advanced technologies and infrastructure, she said.

EEI has not modeled costs in this way, but the power sector is the U.S.'s "most capital intensive industry and spends about $120 billion annually on generation, transmission and distribution," Fisher said. $2.5 trillion doesn't sound unreasonable [for] economy-wide NZE by 2030 and is "not necessarily out of line with the kinds of investments we are making already."

Spending for NZE increases with the pace of generation and transmission deployment, which "will double through 2030 and accelerate after that," Mayfield said. "It took about 150 years to build today's grid and we have to build that much transmission in the next 15 years."

The projected cost of an economy-wide 50% emissions reduction by 2030 is affordable and "varies little across allocation methods," Massachusetts Institute of Technology Research Scientist Mei Yuan confirmed in her webinar presentation.

But the incremental cost of reductions "begins to rise more steeply as emissions decline and approach zero," LBNL's Wiser stressed. "Further research, development and demonstration are needed for the numerous technologies, like longer-duration storage, green hydrogen, synthetic or biofuels, carbon capture, advanced nuclear, or geothermal, that are the last puzzle pieces."

Annual energy spending to achieve NZE would, however, be comparable to or lower than the part of GDP presently spent for energy, Princeton reported. And it would lead to other benefits.

As early as the 2020s, NZE would produce a net increase of 500,000 to 1 million jobs per year over DOE's business-as-usual scenario, Princeton projected. The cumulative air quality benefits through 2050 would avoid 200,000 to 300,000 premature deaths at an estimated avoided cost of $2 trillion to $3 trillion, which are benefits larger than, though similar to, those identified by LBNL in the power sector. 

"The U.S. has rapidly and significantly bent the carbon curve down over the last 15 years," LBNL's Wiser said. "It has been a win, win, win because it has reduced health impacts of air pollution, increased power sector employment, and did not significantly impact U.S. electricity bills, which shows we should be prepared to be surprised again."

There were serious doubts that the power system could integrate and manage variable renewables "but grid operators are doing a better job of it everyday," EEI's Fisher added. "Never count out engineers and scientists if we give them the resources and the policies to support their abilities to do what needs to be done."

But a conservative approach to goal setting could be important because "missteps in implementation risk backlash or disillusionment with deep decarbonization efforts," Evolved Energy Research's Jones said. "A 45% emissions reduction target that gets to 47% might be better than falling short of a 50% target because we need wins that drive the work to get all the way to net zero."