Modeling of 80% by 2030 Clean Electricity Payment Program

Recent modeling shows that achieving 80% clean electricity nationwide by 2030 is achievable and will bring enormous climate, public health, and economic benefits. This blog summarizes the key assumptions in the modeling used in an Analysis Group report published today and discussed in a prior NRDC blog.

We used the Integrated Planning Model to study a version of the Clean Electricity Payment Program (CEPP), a federal budgetary mechanism that provides payments to electric utilities that increase their share of clean electricity each year and penalties for those utilities with slower clean electricity growth.

The jobs, economic, and climate effects of CEPP depend on several key features: 

1. The annual clean electricity increases to determine payments and penalties; 
2. The size of the payments; 
3. The size of the penalties; 
4. Which resources qualify as clean; and
5. Which types of electric utilities are included in the program. 

The table below summarizes the key design elements in the CEPP scenario used in the Analysis Group report, alongside the anticipated effects and tradeoffs if the program has different features from those shown here. The scenario also includes a 10-year extension of clean energy tax incentives.

Because Congress has not yet publicly introduced CEPP legislation, this analysis focuses on one version of CEPP, not necessarily what will be included in an introduced bill. Further analysis will be needed of specific designs Congress proposes. 

The scenario analyzed in the report and blog results in 81% clean electricity by 2030, an 85% reduction in power sector carbon dioxide emissions from 2005 levels by 2030, a 76% reduction in nitrogen oxide emissions, and a 93% reduction in sulfur dioxide emissions. The climate and public health benefits total $106-184 billion per year by 2030, far exceeding the costs. The results of this scenario are further described in a previous blog and the Analysis Group report released today. This is one of many potential scenarios, depending on the final design of a CEPP program.