[Senate Hearing 117-106]
[From the U.S. Government Publishing Office]


                                                    S. Hrg. 117-106

                       GLOBAL CLIMATE TRENDS FROM
                   ENERGY-RELATED SECTORS TO CONSIDER
                    WHERE AND HOW PROGRESS HAS BEEN
                   MADE IN ADDRESSING CLIMATE CHANGE

=======================================================================

                                HEARING

                               BEFORE THE

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                    ONE HUNDRED SEVENTEENTH CONGRESS

                             FIRST SESSION

                               ----------                              

                            FEBRUARY 3, 2021

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               Committee on Energy and Natural Resources
               
               
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                               __________

                                
                    U.S. GOVERNMENT PUBLISHING OFFICE                    
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               COMMITTEE ON ENERGY AND NATURAL RESOURCES
                            (116th Congress)

                    LISA MURKOWSKI, Alaska, Chairman
JOHN BARRASSO, Wyoming               JOE MANCHIN III, West Virginia
JAMES E. RISCH, Idaho                RON WYDEN, Oregon
MIKE LEE, Utah                       MARIA CANTWELL, Washington
STEVE DAINES, Montana                BERNARD SANDERS, Vermont
BILL CASSIDY, Louisiana              DEBBIE STABENOW, Michigan
CORY GARDNER, Colordao               MARTIN HEINRICH, New Mexico
CINDY HYDE-SMITH, Mississippi        MAZIE K. HIRONO, Hawaii
MARTHA McSALLY, Arizona              ANGUS S. KING, JR., Maine
LAMAR ALEXANDER, Tennessee           CATHERINE CORTEZ MASTO, Nevada
JOHN HOEVEN, North Dakota

                      Brian Hughes, Staff Director
                      Lucy Murfitt, Chief Counsel
                 Renae Black, Democratic Staff Director
                Sam E. Fowler, Democratic Chief Counsel

                    (117th Congress) \1\

                JOE MANCHIN III, West Virginia, Chairman
RON WYDEN, Oregon                    JOHN BARRASSO, Wyoming
MARIA CANTWELL, Washington           JAMES E. RISCH, Idaho
BERNARD SANDERS, Vermont             MIKE LEE, Utah
MARTIN HEINRICH, New Mexico          STEVE DAINES, Montana
MAZIE K. HIRONO, Hawaii              LISA MURKOWSKI, Alaska
ANGUS S. KING, JR., Maine            JOHN HOEVEN, North Dakota
CATHERINE CORTEZ MASTO, Nevada       JAMES LANKFORD, Oklahoma
MARK KELLY, Arizona                  BILL CASSIDY, Louisiana
JOHN W. HICKENLOOPER, Colorado       CINDY HYDE-SMITH, Mississippi
                                     ROGER MARSHALL, Kansas

                      Renae Black, Staff Director
                      Sam E. Fowler, Chief Counsel
             Luke Bassett, Senior Professional Staff Member
             Richard M. Russell, Republican Staff Director
              Matthew H. Leggett, Republican Chief Counsel
      Justin Memmott, Republican Deputy Staff Director for Energy

---------- 
\1\  Senate Resolutions 28 and 32, concerning official designations of 
committee membership for the 117th Congress, were passed on February 3, 
2021, after this hearing took place.
                           
                           
                           C O N T E N T S

                              ----------                              

                           OPENING STATEMENTS

                                                                   Page
Murkowski, Hon. Lisa, Chairman and a U.S. Senator from Alaska....     1
Manchin III, Hon. Joe, Incoming Chairman and a U.S. Senator from 
  West Virginia..................................................     1
Barrasso, Hon. John, Incoming Ranking Member and a U.S. Senator 
  from Wyoming...................................................     6

                               WITNESSES

Birol, Dr. Fatih, Executive Director, International Energy Agency     7
Newell, Dr. Richard G., President and CEO, Resources for the 
  Future.........................................................    16
Hsu, Dr. Angel, Assistant Professor, University of North Carolina 
  at Chapel Hill, Data-Driven Environmental Policy Lab...........    24
Tinker, Dr. Scott W., Director, Bureau of Economic Geology, The 
  University of Texas at Austin..................................    36
Mills, Mark P., Senior Fellow, Manhattan Institute...............    55

          ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED

American Exploration & Production Council:
    Statement for the Record.....................................   162
Barrasso, Hon. John:
    Opening Statement............................................     6
Birol, Dr. Fatih:
    Opening Statement............................................     7
    Written Testimony............................................     9
    Responses to Questions for the Record........................    95
Hsu, Dr. Angel:
    Opening Statement............................................    24
    Written Testimony............................................    26
    Responses to Questions for the Record........................   122
King, Jr., Hon. Angus S.:
    Chart 1--Atmospheric Carbon Dioxide Levels...................    77
    Chart 2--Sea Level Change....................................    79
    Chart 3--Arctic Sea Ice Minimum Volume 1979 vs. 2020.........    81
Manchin III, Hon. Joe:
    Opening Statement............................................     1
    Chart 1--U.S. Electricity Generation Mix 2005 vs. 2019 (IEA).     3
    Chart 2--China and India Electricity Generation Mix 2005 vs. 
      2019 (IEA).................................................     4
Mills, Mark P.:
    Opening Statement............................................    55
    Written Testimony............................................    57
    Responses to Questions for the Record........................   153
Murkowski, Hon. Lisa:
    Opening Statement............................................     1
Newell, Dr. Richard G.:
    Opening Statement............................................    16
    Written Testimony............................................    18
    Responses to Questions for the Record........................   109
Tinker, Dr. Scott W.:
    Opening Statement............................................    36
    Written Testimony............................................    38
    Responses to Questions for the Record........................   143
Whitehouse, Hon. Sheldon:
    Memorandum outlining the sources for ``Economic Risks of 
      Climate Change'' dated March 3, 2020.......................   166
    Economic Risks of Climate Change: A collection of articles, 
      letters, reports, and speeches.............................   170

 
GLOBAL CLIMATE TRENDS FROM ENERGY-RELATED SECTORS TO CONSIDER WHERE AND 
        HOW PROGRESS HAS BEEN MADE IN ADDRESSING CLIMATE CHANGE

                              ----------                              


                      WEDNESDAY, FEBRUARY 3, 2021

                                       U.S. Senate,
                 Committee on Energy and Natural Resources,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:11 a.m., in 
Room SD-G50, Dirksen Senate Office Building, Hon. Lisa 
Murkowski, Chairman of the Committee presiding, to consider the 
nomination of Governor Jennifer Granholm, to be the Secretary 
of Energy. Upon disposition of the nomination, the Chairman 
adjourned the business meeting and reconvened the Committee to 
take testimony on global climate trends.
    The Committee met, pursuant to notice, at 10:21 a.m. in 
Room SD-G50, Dirksen Senate Office Building, Hon. Lisa 
Murkowski, Chairman of the Committee, presiding.

           OPENING STATEMENT OF HON. LISA MURKOWSKI, 
                    U.S. SENATOR FROM ALASKA

    The Chairman. We can move now to the hearing that is 
scheduled this morning, and I will turn to Senator Manchin.

          OPENING STATEMENT OF HON. JOE MANCHIN III, 
                U.S. SENATOR FROM WEST VIRGINIA

    Senator Manchin. Thank you, Madam Chair.
    So this Committee has proven itself ever ready to rise to 
the occasion of working together to identify and enact 
solutions to both present and future issues facing our country. 
As Chairman, I am committed to continuing these traditions and 
working with all of my colleagues on the issues that are 
important to their states and to our nation. Climate change is 
one of those issues--critical not only to our states and our 
nation, but to every country around the world.
    To address climate change, we must face it head-on, on a 
global scale, and in every sector of our economy. No doubt, we 
will all have differing views on the best way to do that, but 
first, I believe, we must begin with a common understanding of 
where we stand today and what got us here. I have long said 
that you are entitled to your own opinions, but not your own 
facts. And it is in that spirit that I wanted our first hearing 
of this new Congress to focus on setting a baseline of global 
climate facts from which the Committee can build on as we 
advance climate solutions.
    In 2019, a few of my colleagues and I visited the Arctic, 
where we met with several leaders, and in each country we 
visited, we saw the impact of climate change firsthand and 
heard from those leaders that it was a matter of survival, not 
of partisan politics. I will ad-lib here: when we had been in 
Ottawa, the United States was the only country of all the 
Arctic nations that basically used climate as a political 
divide. They all came to a conclusion. John, we were all there. 
It was a great day that we had with our Chairman, our former 
Chairman, almost.
    [Laughter.]
    Maybe.
    This Committee has shown the ability to rise above that, as 
evidenced by the recent enactment of the Energy Act--our all-
of-the-above energy innovation package with provisions 
sponsored by almost 70 senators last year. It is abundantly 
clear that the dwelling on partisan rhetoric shuts down debate, 
collaboration, and progress. And as we look for ways to heal 
the division in our own country, I believe that one way for us 
to overcome our differences of opinion is by first grounding 
ourselves in the facts, which will serve as a guide going 
forward.
    Before hearing from our panel today, there is one fact that 
I would like to serve as our starting point, and that is that 
climate change is real and largely linked to human activity. 
Scientists around the world, including in our national 
laboratories, are researching many aspects of climate change, 
and the scientific record is convincing and growing. This 
year----
    [Coughing.]
    Excuse me. Oh boy, I just got tested.
    This year, the Intergovernmental Panel on Climate Change--
--
    Senator Barrasso. Was it positive or negative?
    [Laughter.]
    Senator Manchin. That was a good one, John.
    [Laughter.]
    This year, the Intergovernmental Panel on Climate Change 
will release its sixth comprehensive report on global climate 
change, and I look forward to learning the new findings.
    We also have an immense amount of energy data on our 
fingertips, thanks to the incredible work of the U.S. Energy 
Information Administration and international organizations like 
the International Energy Agency (IEA). A snapshot of that data 
shows that in the past 10 to 15 years, the United States has 
seen major transition in energy markets. We will be leaving 
these two panels up here for you all to view.
    [The two panels mentioned follow:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Senator Manchin. The cost of natural gas has been cut in 
half from 2010 to 2020 and the cost of wind has fallen by 70 
percent and the cost of solar has fallen by 90 percent. When 
paired with increasing energy efficiency, this has led to a 
rapidly changing electric power grid system. While it is much 
less carbon intensive, retirements of coal-powered plants have 
devastated communities across my home State of West Virginia 
along with many other traditional energy-producing states 
represented on this Committee.
    That raises two points that we must recognize about fossil 
fuels. In the domestic context, the energy transition has 
increased hardships in the areas of the United States that have 
powered our nation for decades by mining its coal, producing 
its fuel, and generating its electricity. As our energy mix has 
changed, concern about the impacts on these traditional energy 
communities has and will remain front-of-mind for many of our 
members. I will continue to work hard to ensure that those 
communities are given new opportunities to thrive, including as 
a member of the new IEA Global Commission, focused on examining 
the impacts of a clean energy transition on individuals and 
communities. I am honored to join this effort and confident our 
discussion today will provide a strong foundation for 
discussions ahead as we work to address climate change and 
leave no one behind.
    We must also recognize that although fossil fuel 
consumption is dropping in the U.S. power grid, the global 
transition in fossil fuel use should make us all recognize that 
fossil fuels are not going away anytime soon, particularly in 
countries that are seeking to expand access to electricity and 
energy in order to address poverty. In both the domestic and 
international arenas, however, the fact is that we have tackled 
these challenges before and we can overcome them again by 
focusing on the technological innovations needed to do so. 
Following the Clean Air Act amendments of 1990, electric 
utilities across the United States developed and adopted 
equipment that aided their compliance with the new laws to 
reduce or eliminate SOX and NOX and 
particulate matter. By outlining the facts about our pollution 
and developing the technologies needed to manage it, utilities 
were able to adapt and improve public health and maintain jobs, 
all at a lower cost than what was initially projected. This 
provides one principle for our Committee's work going forward: 
the power of innovation combined with keeping all of our 
options on the table will help us create high-quality jobs, 
reach our environmental goals, and do so cost-effectively.
    I also think it applies in the global arena, as we look to 
lead the world on tackling the climate challenge. We must 
remember that the rest of the world is not necessarily ready to 
follow the same path as we do. By pursuing an all-of-the-above 
energy policy and a broad array of emissions-reducing 
technologies, we can simultaneously build our technology export 
opportunities and diplomatic relationships with those countries 
who choose to utilize their own fossil resources.
    Today's panel includes experts that bring domestic as well 
as global perspectives and includes Dr. Birol, the Executive 
Director of the International Energy Agency; Dr. Richard 
Newell, the President and CEO of Resources for the Future; Dr. 
Angel Hsu, an Assistant Professor at the University of North 
Carolina; Dr. Scott Tinker, Director of the Bureau of Economic 
Geology at the University of Texas; and Mr. Mark Mills, a 
Senior Fellow at the Manhattan Institute. I would like to 
welcome all of you to the Committee for this important 
retrospective discussion that will set the scene for forward-
looking solutions. I look forward to hearing this discussion 
and about the trends and current state of play in global and 
domestic energy markets, technologies, policies, and emission 
reductions. Of course, the raw data and percentages are just 
the tip of the iceberg. Below the surface, the changes we have 
seen were being driven by innovation, policy, markets, and 
incentives. This discussion will serve an important role in 
setting a baseline of common facts and a historical perspective 
for this Committee from which we identify the common challenges 
and opportunities and move quickly to address them.
    With that, I am going to turn it over to Senator Barrasso 
for his opening statement.
    Senator Barrasso.

           OPENING STATEMENT OF HON. JOHN BARRASSO, 
                   U.S. SENATOR FROM WYOMING

    Senator Barrasso. Thanks, Senator Manchin, and you know, in 
December of last year, Congress passed historic, bipartisan 
climate innovation legislation that I worked on closely in the 
Environment and Public Works Committee with Senator Carper. 
This was the most significant greenhouse gas reduction bill to 
be signed into law in well over a decade. Importantly, it won't 
raise costs for American families. So I look forward to working 
with you, Senator Manchin, on energy and environmental 
innovation in this same bipartisan spirit.
    Today's hearing is intended to set the baseline of 
knowledge about contributions to global emissions. It is a very 
worthwhile goal. We are holding this hearing at a very critical 
moment. Over the past two weeks, the Biden Administration has 
rolled out a series of indefensible and ineffective climate 
policies that will sacrifice--that is the term used by the 
nominee to be Secretary of Energy--to sacrifice tens of 
thousands of American jobs. This hearing can provide an 
important reality check. I think we have to stop fooling 
ourselves into thinking that eliminating U.S. fossil fuel 
production is going to solve the problem, because it won't. It 
will just make America less competitive and less energy secure.
    The energy industry has been a critical engine of economic 
recovery in the past. After the Great Recession, while the rest 
of the economy was still struggling, the oil and gas industry 
was investing and adding jobs at a brisk pace. Because of these 
investments, the U.S. has some of the lowest energy prices, 
cost to consumers, in the world. Now President Biden wants to 
kill energy jobs and drive up energy prices. Undermining 
America's energy security will not solve climate change. It is 
unrealistic to expect that China, India, and Russia and many 
other large emitters will stop using fossil fuels. It is just 
unrealistic. They know the importance of affordable energy to 
their own economies. Eliminating U.S. fossil fuels is not going 
to change any of that.
    This data from the International Energy Agency has shown 
that the U.S. has become a significantly smaller source of 
carbon dioxide emissions worldwide. U.S. emissions now account 
for just 14 percent of the global total. That is down from 25 
percent just 20 years ago. Over that same period of time, the 
share of total emissions from China jumped from 13 percent of 
the world's carbon emissions all the way up to nearly 30 
percent--from 13 to 30 percent of the world's carbon emissions 
due to China. And it is not just China. Emerging economies like 
India, Brazil, South Africa, and others are all increasing 
energy use as they develop and grow in population. The 
International Energy Agency expects that by the year 2030, 
energy use in these and other developing countries will jump by 
almost 20 percent. With almost a billion people still lacking 
access to electricity around the world, addressing climate 
change is not a priority for developing countries, especially 
if it hampers their economic development. They do not consider 
it a priority in their efforts for economic development.
    Affordable, reliable, and scalable energy are the keys to 
reducing energy poverty, to improving human welfare, and to 
powering economic growth. These trends mean we have to focus on 
practical solutions. At its most fundamental level, reducing 
greenhouse gas emissions is a technology challenge. Instead of 
raising the cost of traditional energy sources, we should work 
to lower the cost of alternate technologies, like carbon 
capture and advanced nuclear reactors. Until that happens, 
traditional fuels are going to continue to capture the lion's 
share of global energy demand.
    An approach based on innovation plays to our strength in 
America. American innovation is the key to reducing global 
emissions and our goal should be to encourage and support that 
process and that progress.
    Thank you, Mr. Chairman.
    Senator Manchin. Thank you, Senator.
    Now we are going to turn to our witnesses. And our first 
witness will be Dr. Birol. Doctor, thank you so much.

STATEMENT OF DR. FATIH BIROL, EXECUTIVE DIRECTOR, INTERNATIONAL 
                         ENERGY AGENCY

    Dr. Birol. Thank you very much, Senator Manchin. Senator 
Manchin, Senator Barrasso, still the Chairman, Senator 
Murkowski, members of the Committee, dear fellow witnesses, 
greetings to all of you from Paris, from International Energy 
Agency Headquarters.
    So before starting my words, may I congratulate Governor 
Granholm for getting the approval of the Committee and, if 
confirmed, I am looking forward to working with Ms. Granholm as 
the next Secretary of Energy of the United States.
    And also, many thanks to Senator Manchin for agreeing to be 
a member of our Global Commission on People-Centered Clean 
Energy Transitions. Thank you very much, sir, for joining 
global leaders focusing on this issue.
    It's an honor for me to be here as the Head of the IEA, to 
be in front of you. I had the pleasure to testify several times 
and I can tell you, every time I learn a lot from you and I 
understand it's a special group that work on a bipartisan basis 
and reach several good results, the last one being the Energy 
Act of 2020, for which I thank you and I congratulate you.
    Now, you have my full testimony in front of you, so I just 
want to focus on three points from the global picture. First, 
current state of play, international climate change. Our 
climate change is essentially an energy challenge. Why? Very 
simple--about 80 percent--in fact, more than 80 percent of the 
emissions causing climate change come from the production and 
use of energy. And methane comes out of that. If you look at 
the major emitters, I'll give you four of them, four major 
ones. China is, by far, the largest emitter since 15 years, 
China is the largest emitter, responsible about 30 percent of 
global emissions. But China is also, by far, the leader of 
solar energy. The solar energy in China is equal to all the 
other countries put together. India emissions are about seven 
percent. But on a per-capita basis, it is about the lowest in 
the world. The European Union--also about seven percent, and I 
should mention to you that the latest EU stimulus package will 
spend billions on new clean energy technologies. The United 
States--USA's international world emission reductions over the 
recent years and today, U.S. emissions are half of that of 
China, but on a per-capita basis, still very, very high. So 
this is the picture of where we are.
    The second point I want to mention is the technologies we 
maybe enact to reach our climate course. We have wonderful 
technologies which are already ready for the markets--solar, 
wind, onshore wind, offshore wind, hydropower, geothermal, 
nuclear power--they are ready for the markets, but they alone 
are not enough, by far not enough to reach our climate course. 
Innovation, as Senator Barrasso mentioned, is the key word here 
and the innovation in the carbon capture and storage industry. 
Hydrogen and advanced nuclear will be critical to reach our 
climate course. We have some which are ready. They are not 
enough. We need innovation, other clean air technologies being 
made part of our markets.
    Third point: clean air energy transitions will have broad 
repercussions and there are some challenges. I want to 
highlight only two for you, maybe we can discuss at length in 
the next minutes to come. The first one is the challenges 
coming from the critical minerals. Under ambitious climate 
policies, the energy sector will become a major force in drive 
and demand for copper, lithium, nickel, and cobalt and we see 
it still develop vulnerability of our global system in the next 
years to come. It is the reason IEA is preparing a major study 
to look at the global tensions that can arise from this 
challenge.
    The last point I want to mention, another broader 
implication, is how the governments will be able to proceed 
clean energy transition without having major impact on the 
communities, on the workers. So smart, well-designed policies 
will be critical in order to help everybody on board. So these 
are two major implications while we proceed with clean energy 
transitions around the world.
    Once again, Mr. Chairman, thank you very much for inviting 
the International Energy Agency. I am looking forward to your 
questions and the comments of my colleagues. Thank you.
    [The prepared statement of Dr. Birol follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Senator Manchin. Thank you, Dr. Birol.
    And next we have Dr. Newell for his opening statement.
    Dr. Newell.

    STATEMENT OF DR. RICHARD G. NEWELL, PRESIDENT AND CEO, 
                    RESOURCES FOR THE FUTURE

    Dr. Newell. Senator Murkowski, Senator Manchin, Senator 
Barrasso, distinguished members of the Committee, thank you for 
the opportunity to provide my testimony today. My name is 
Richard Newell. I'm the President and CEO of Resources for the 
Future, an independent, non-profit research institution that 
has informed energy and climate policy for decades. RFF's 
mission is to improve environmental energy and natural resource 
decisions through impartial economic research and policy 
engagement. The views I express today are my own and may differ 
from those of other RFF experts.
    I've had the opportunity to testify before this Committee 
previously as the Administrator of the U.S. Energy Information 
Administration. I therefore appreciate the importance of 
decisions informed by the best data, science, and analysis 
available. It's my pleasure to be with you here again to speak 
today about global climate, energy, and emissions trends, 
particularly from a U.S. perspective.
    The climate is unquestionably changing and human activity 
is the primary driver. Since the industrial revolution, humans 
have released increasing amounts of greenhouse gases to the 
atmosphere, leading to higher average global temperatures, 
melting ice caps, sea level rise, and other impacts. The 
consequences are stark. The average global temperature has 
already risen by one degree Celsius. And regions like Alaska 
have confronted increases twice that amount. The U.S. is the 
second largest emitter of greenhouse gases after China, and we 
remain the largest contributor to cumulative historic 
greenhouse gas emissions. Eighty-three to 85 percent of U.S. 
emissions come from the production and use of energy, 
particularly from fossil fuel production. Our mission's 
trajectory hinges on economic growth, improvements in energy 
efficiency, and shifts to low or zero carbon energy sources. 
These shifts are driven, in turn, by three major forces: energy 
market conditions, technological innovation, and public policy.
    U.S. greenhouse gas emissions have decreased/declined since 
2005, primarily due to declining coal-based electricity 
generation and increasing power from natural gas and renewable 
power sources. Wind and solar have experienced cost declines of 
over 70 percent since 2009 and have benefited from tax credits 
and other policies. Natural gas power has benefited from low 
prices due to shale gas innovation. There have also been 
substantial advances in technologies that can complement 
intermittent renewables to provide reliable power, such as 
energy storage, advanced nuclear, advanced geothermal systems, 
and natural gas with carbon capture.
    The transportation sector is now the largest source of U.S. 
greenhouse gas emissions, although transport emissions have 
fallen by about five percent since 2005, principally due to 
increased fuel economy of vehicles. The cost and range of 
electric passenger vehicles have improved considerably, but 
aviation, shipping, and long-haul trucking are more difficult 
to electrify. U.S. emissions from industrial sources such as 
steel, cement, and petrochemical production, have shifted only 
modestly since 2005. Industrial processes that require very 
high temperatures or have process-related emissions require a 
distinct set of solutions, possibly carbon capture and storage, 
hydrogen or advanced nuclear technologies. Outside of energy--
agriculture, forestry, and other land use emission sources 
present distinct issues and they also present opportunities for 
carbon removal through biomass, carbon sequestration in 
forests, grasslands, and soils. Direct air capture of carbon is 
also now possible through technological means.
    Because the energy system is so widespread and complex, 
reducing emissions will require a broad and inclusive approach 
to incorporating new technologies. We can't know in advance 
which technologies will become most competitive. So expanding 
our solution set makes ambitious strategies more feasible.
    I'll conclude with three key observations. First, the 
concentration of greenhouse gases in the atmosphere is 
increasing rapidly, causing our climate to change. Fossil fuel 
use is the leading cause, and the U.S. is a major contributor. 
Second, a wide array of technological options is both necessary 
and available to reduce emissions across a diverse energy 
landscape. And finally, given cost reductions in advances in 
clean energy and other emission reduction technologies, 
ambitious reductions are now more achievable at substantially 
lower cost. The success of emissions reduction strategies will 
depend on how well they meet the needs of diverse sectors, 
incentivize consumers and producers to choose low emission 
options, and spur technological innovation. Research shows that 
incentive-based policies, coupled with targeted innovation 
support, are the most effective means to allowing private 
sector incentives with society's emission reduction goals. 
Innovation flourishes when accelerating demand for new 
technology is coupled with robust support for research and 
development.
    Senators, I want to thank you again for this opportunity to 
appear before you. I'll now conclude my remarks and look 
forward to your questions.
    [The prepared statement of Dr. Newell follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Senator Manchin. Thank you, Dr. Newell.
    And next we have Dr. Hsu.

STATEMENT OF DR. ANGEL HSU, ASSISTANT PROFESSOR, UNIVERSITY OF 
NORTH CAROLINA AT CHAPEL HILL, DATA-DRIVEN ENVIRONMENTAL POLICY 
                              LAB

    Dr. Hsu. Thank you, Senators Manchin and Barrasso and 
members of the Committee on Energy and Natural Resources, for 
inviting me here to testify today. It is an absolute honor to 
be here and share my knowledge on these issues. I am a 
contributing and lead author to several global climate 
assessments and Director of the Data-Driven Environmental 
Policy Lab at the University of North Carolina--Chapel Hill. 
Much of my research has focused on China and its contributions 
to global climate and energy policy. Maintaining primarily a 
global perspective, I would like to address four points. One, 
where we stand today on global climate change. Two, where our 
existing policies stand in limiting global temperature rise. 
Three, China's role in combating climate change. And lastly, 
the potential for some national actors and the business 
community to fill climate policy shortfalls.
    First, I'm starting with the current status of the global 
climate. The latest climate science literature describes a 
narrowing window for meaningful climate action to restrict 
global temperature rise to 1.5 degrees Celsius. As Dr. Newell 
just said, temperatures have already risen by about 1.1 degree 
Celsius. Emissions increased on average around one percent each 
year over the last decade, with 2019 seeing a record-high 
emissions level predominantly driven by global fossil fuel 
consumption. Despite the devastating impacts of COVID-19, 
however, it has been the single largest, short-term influencer 
of greenhouse gas emissions. In 2020, carbon dioxide emissions 
reductions due to COVID-19 related shutdowns are estimated to 
be between seven and nine percent. This precipitous drop in 
emissions has provided now an opportunity for countries like 
the U.S. to consider post-COVID-19 recovery plans with climate 
change and energy policy considerations. There is a strong 
economic case for the transition away from fossil fuels to 
renewable energy. Costs have continuously declined for 
renewable energy and demand has remained robust compared to 
fossil fuels. For example, in 2020, over 70 percent of utility-
scaled power that was added to the U.S. generation capacity was 
in the form of renewable energy.
    Second, in terms of the current policy status, the science 
is clear that we need to get to zero emissions by 2050 to 
contain global temperature rise to 1.5 degrees Celsius. 
Ideally, global emissions should have already peaked in 2020. 
One analogy that has been used to describe the challenge is 
that we need emissions now to fall off a cliff. If the road had 
begun steadily decreasing emissions around ten years ago, we 
would only need to have been reducing emissions by two percent 
per year. Now global emissions need to decrease by seven 
percent per year until dropping to zero. The reality is that 
the ambition of national government climate policy efforts are 
woefully inadequate to stay within our remaining carbon budget. 
At our current emissions rate, we will deplete the entire 
remaining carbon budget within the next ten years. While the 
data show that countries' track record for addressing climate 
change has not been adequate, around 127 countries recently 
have pledged to decarbonize, including China, the world's 
largest emitter of greenhouse gas emissions. China's President, 
Xi Jinping, announced last September at the U.N. General 
Assembly that it would commit to become carbon neutral by 2060. 
This carbon neutrality pledge is significant. If successful, it 
could cool the planet by about 0.2 to 0.3 degrees Celsius by 
2100 on its own.
    But to meet this carbon neutrality goal, China will need to 
eliminate coal as part of its energy mix, which in 2018 
generated 65 percent of its electricity. They have a plan to 
phase it out by 2050 and generate 90 percent of all electricity 
from non-fossil sources, including renewables and nuclear 
energy. To do this will require a 16-fold increase in solar 
energy, a ninefold growth in wind power, a sixfold increase in 
nuclear and a doubling of hydroelectricity. China will also 
need to grow renewable energy investments to around 15 trillion 
U.S. dollars in the next 30 years. It currently already tops 
global clean energy investments at around 100 billion U.S. 
dollars each year, more than the U.S. and EU combined, and it 
is a leading manufacturer of wind, solar, and electric vehicle 
technology. The U.S. and the world can have confidence that 
China will meet this carbon neutrality target. The country's 
past record demonstrates that it has met or has come extremely 
close to meeting every single energy and environmental target 
the country has set. It is already on track to overachieve its 
2020 and 2030 carbon intensity goals and independent satellite 
data confirm that China has achieved significant reductions in 
air pollution already.
    Despite the importance of Chinese climate commitments and 
other existing agreements however, this still won't get us all 
the way to net zero. Our research demonstrates that nearly 
6,000 cities, states, and regions and over 1,500 companies' 
existing climate efforts will lower greenhouse gas emissions by 
1.2 to 2 gigatons of carbon dioxide equivalent in 2030. This is 
additional reduction and it amounts to roughly four percent of 
the world's total annual greenhouse gas emissions, as much as 
Japan and Canada emit in a single year. In the U.S., these 
commitments could provide at least half of the reductions 
needed to meet its Paris pledge. As of October 2020, more than 
1,500 businesses, 826 cities, and 103 regional governments, 
including 24 U.S. states, have already made net zero 
commitments.
    To end, how national governments design post-COVID-19 
economic recovery strategies will largely determine how much 
global emissions rebound to pre-COVID-19 levels. Global 
competition and cooperation on clean energy, building on 
continued progress from some national business actors, is one 
vehicle toward our decarbonization goals. Thank you very much 
and I look forward to further discussion and your questions.
    [The prepared statement of Dr. Hsu follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Senator Manchin. Thank you, Dr. Hsu.
    Now let's hear from Dr. Tinker.

STATEMENT OF DR. SCOTT W. TINKER, DIRECTOR, BUREAU OF ECONOMIC 
           GEOLOGY, THE UNIVERSITY OF TEXAS AT AUSTIN

    Dr. Tinker. Senators, distinguished members, fellow 
panelists, it's an honor to be here today with you. Senator 
Murkowski, thanks for your leadership. Senators Manchin and 
Barrasso, I look forward to working with you.
    We all share a common desire to provide affordable, 
reliable energy in order to grow healthy economies and lift the 
world from poverty, while also minimizing environmental 
impacts, including climate, land, water, air. There may be a 
perception of division, but I think it's a false divide. Let's 
not let that division triumph. I had planned to mention a bit 
about my background and highlight key facts about global 
poverty, population, energy, and the economy, but that's all in 
my written testimony and that can be made available to anyone 
listening in.
    Instead, I'd like to tell you a story. The films we have 
made the past decade on global energy, the environment, and 
poverty are nonpartisan and introduce critical thinking on 
these important issues. They are used by educators all over the 
world for students of all ages. As such, I am asked by teachers 
and faculty, globally, if I could please visit in person or 
Zoom in with their students for a short discussion. It would 
mean so much to the kids, they say. I try to do as many of 
these each month as I can.
    Just before COVID, I was visiting an environmental class of 
about 50 lower division university students--an ``ask me 
anything'' format. And near the end, one student said, and I 
quote, ``Why does any of this matter? We're all gone in 15 
years anyway?'' ``What do you mean,'' I asked? ``Humans. We're 
gone because of climate change.'' Trust me, I am rarely 
speechless. I asked the class how many felt that way. Fifty 
percent raised their hands. I was stunned. I asked why they 
felt this and if they could describe what would actually wipe 
out all of humanity in 15 years.
    They couldn't describe how anyone would actually die. They 
just said they were being taught that climate change is an 
existential threat and learning that from their leaders. To 
them, that meant humans will no longer exist. I was deeply 
disturbed by this on many levels, for many weeks. Where was the 
critical thinking?
    The non-partisan, non-profit Switch Energy Alliance that I 
formed many years ago makes critical thinking films on energy 
and the environment. We have worked with AP environmental 
science high school teachers across the country the past few 
years to develop a truly objective curriculum on energy for 
classes across the U.S. It didn't take long to discover how 
bias is introduced. Here's an example of two essay questions 
from an AP test: What are the environmental benefits of 
offshore wind? What are the environmental impacts of tar sands? 
The questions can only result in the student seeing benefits of 
one option and impacts of the other. When in fact, we all know, 
and we've heard--there are pros and cons to both. This happens 
at the highest levels.
    Just this morning, E&E reported that a new National 
Academies report offers a comprehensive roadmap for achieving a 
carbon-free economy by mid-century and concludes that it is, 
quote, ``on the edge of feasibility.'' Of course, if the 
question posed to the National Academies committee was, ``How 
do we reach a carbon-free economy?'' By definition, the report 
will attempt to spell that out. Critical thinking would ask, 
``How do we reach a carbon-free economy without damaging the 
land, water, and local air in the process?'' In other words, 
how do we avoid robbing from nature Peter to pay climate Paul?
    I trust we all believe that humans will be here in 15 years 
and hopefully well beyond that. As such, each of us carries a 
remarkable burden. We do not want students around the world to 
feel duped someday when they realize that ``clean'' didn't 
really mean ``clean.'' To be sure, coal, oil, and natural gas 
to a lesser degree, impact the environment. Let's continue to 
clean them up, especially the emissions, but all forms of 
energy impact the environment.
    As a geoscientist, I'm not against mining. I know that low-
density sources of energy, such as solar, wind, biofuels, and 
batteries will require an unprecedented scale of mined, 
sometimes toxic, resources from the earth that must be disposed 
of when they wear out and they get disposed in the land and the 
ocean. Although levelized cost of electricity and energy have 
fallen, the cost of full-scale redundant backup makes it more 
expensive to the consumer. Ask California and Germany. It's not 
clean or renewable or cheaper, it's just different. So let's 
converge on a plan that provides equitable energy access 
globally and addresses not only emissions, but all 
environmental impacts. The plan should focus on some key 
CO2 solutions: Reduce actual CO2 
emissions into our single global atmosphere; protect the rest 
of the environment; be affordable, dispatchable and scalable; 
be deployed or deployable in the next two decades; protect U.S. 
security and the U.S. economy; and lift the world from energy 
and economic poverty.
    Fortunately, solutions exist. Options you have heard from 
other witnesses here are remarkably consistent. Switching from 
coal to natural gas, especially in Asia--if Asia doesn't act, 
it won't matter. Preserve the nuclear fleet in the U.S. and 
support nuclear globally, especially small modular reactors, 
and streamline deep borehole disposal. Accelerate efficiency 
across all U.S. and global sectors. Natural gas, nuclear, and 
efficiency, in partnership with solar and wind, CCUS, hydro, 
geothermal, hydrogen, and others provide dispatchable, 
reliable, affordable energy today and it preserves industry and 
grows higher-wage jobs. The U.S. can lead through investment in 
technology, federal and state incentives, and efforts to find 
scalable, affordable, timely solutions. Although tempting, we 
have to resist the well-intended efforts to restrict market 
opportunities and optionality, which often result in unintended 
consequences.
    Thank you for the opportunity to speak with you today.
    [The prepared statement of Dr. Tinker follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Senator Manchin. Thank you, Dr. Tinker.
    And finally, we have Mr. Mills. Thank you for being here, 
Mr. Mills.

                  STATEMENT OF MARK P. MILLS, 
               SENIOR FELLOW, MANHATTAN INSTITUTE

    Mr. Mills. Thank you, incoming Chairman Manchin, very much 
for----
    Senator Manchin. We'll get this worked out pretty soon.
    [Laughter.]
    Mr. Mills. And thank you, outgoing Chairman Murkowski. I 
was tempted to make an allusion to Bill Murray in the movie we 
all know and love. But thank you for inviting me, it's an honor 
and a pleasure, and Senator Barrasso and members of the 
Committee.
    Since the purpose of this hearing is to establish a 
baseline on the state of affairs regarding carbon dioxide 
emissions associated with energy, permit me to note three basic 
realities and each of them have implications for the subject at 
hand. These are realities, in fact, that help explain why, as 
the Committee's Joint Staff Memorandum notes, that global 
carbon dioxide emissions continued to increase prior to the 
pandemic lockdowns, despite massive investments in non-hydro 
carbon energy production both in Europe and the United States 
and China.
    First, it's indisputable--and it's a good thing that the 
world will use far more wind turbines and solar machines and 
electric cars in the future. The reason for that, aside from 
obvious policies encouraging all three, is anchored in the fact 
that those technologies are all profoundly better than they 
were a decade or two ago, and given the magnitude of future 
global energy needs to bring people out of poverty, more 
options are always better.
    Second, it's equally indisputable that all energy machines 
are, necessarily, built and operated using materials that must 
first be extracted from the earth. Replacing hydrocarbons with 
the wind, solar and battery-powered machines--the principal 
vectors in most countries on these discussions--doing that 
constitutes a major shift in both the nature and the quantities 
of these energy materials. It's a switch from using mainly 
liquids and gases to using solids, and it's a switch that, on 
average, results in a tenfold increase in the quantity of 
materials mined and processed per unit of energy delivered to 
society.
    And third, the United States is today, and will be for the 
foreseeable future, a net importer of either wind, solar, or 
battery machines, or key components for those machines or, in 
fact, for most of the critical energy minerals and materials 
needed to build them.
    Now, these realities have implications in the accounting of 
carbon dioxide emissions. They also have economic, and of 
course, geopolitical, environmental, and even human rights 
implications. I know, briefly, that the U.S. is essentially, as 
the Committee knows, self-sufficient today in net hydrocarbon 
use. It's an importer, though, of alternative energy materials 
and machines. This means that replacing the former, which 
supply 80 percent of America's energy, with the latter, would 
replace a very large share of the domestic GDP with imports.
    So given the way the world is, not as we wish it would be, 
increasing domestic use of wind, solar, and batteries results 
in a de facto export of carbon dioxide emissions. That's 
because mining and processing of energy minerals and the 
fabrication of energy machines is inherently energy-intensive, 
and most of that energy used takes place offshore. By 
calculating the magnitude of that, one could call it offshoring 
of emissions, it's actually complex. There are some analyses 
that have, for example, looked at the impact of processing 
battery materials or fabricating battery components in China, 
which, in fact, this Committee may know is a major, if not the 
dominant, share of such industries.
    With China's grid that's two-thirds coal-fired, that 
processing and fabrication leads to supply-chain carbon dioxide 
emissions that constitute a significant share and can even be 
the entire share of any emissions that are eliminated by 
replacing a combustion engine with an electric vehicle in many 
parts of the United States. In fact, in more broadly looking at 
global mining, its oil use for heavy machinery, of course, 
rivals the total oil use of global aviation--of course, before 
the Great Lockdowns. Meanwhile, the path contemplated in the 
Paris Accord will lead to the greatest acceleration in demand 
for mining that the world has ever seen.
    This all points to the need for a realistic supply-chain 
emissions analyses, accounting of the carbon dioxide of where 
it really comes from and de facto export of carbon dioxide 
emissions, something that's lacking in the current carbon 
accounting, but also points, frankly, to an opportunity for the 
United States to revitalize our domestic mining and mineral 
processing industries, something I note that China has been 
focused on for years.
    I'd like to conclude by noting that there's some irony in 
the fact that the world that's coming full-circle to revisit 
the importance of mining. It's humanity's oldest industrial 
activity, in fact. Way back in 1934, speaking of baselines, the 
great American philosopher and technology historian, Lewis 
Mumford, who was born in Queens, by the way, observed in a 
seminal book about technology and civilization that the 
industrialization of mining was a major and, in fact, in his 
view it was the primary vector, the primary driver in the 
creation of modern capital markets, in the organization of 
labor, and in our understanding of our relationship with the 
environment. Given green energy plans, I expect we'll be 
revisiting those lessons in the coming decades.
    I thank you for the opportunity to testify.
    [The prepared statement of Mr. Mills follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Senator Manchin. Thank you, Mr. Mills.
    And now we will turn to our Chairwoman for her questions. 
She was just regrouping there and she is ready.
    The Chairman. I am absolutely ready. I was getting ready to 
go over to HELP and then come back but you have given me an 
opportunity.
    Senator Manchin. You are going to start right out, ma'am.
    The Chairman. I am going to start right out.
    Senator Manchin. You are still officially our Chairperson.
    The Chairman. I do have to comment, Mr. Mills, your last 
statement there included the recognition or the reality that we 
are switching our vulnerability, if you will, from liquid state 
to soon, solid state. That is something that I think we need to 
be thinking about, and it is something that this Committee has 
focused on. Senator Manchin and I had our Critical Minerals 
bill that we included in the Energy Act, but we know we need to 
be doing more in that regard, and what you have highlighted 
here, I think, is very important. And you, Dr. Birol, in your 
comments mentioned much the same.
    And again, I want to extend my thanks and my appreciation 
to Dr. Birol. You and your leadership, the opportunity that I 
have had to serve as a member of the Global Commission on 
Energy Efficiency, some of the best practices that we have been 
able to work through and talk about, I just so appreciate your 
leadership there.
    I guess I would direct this question to both Dr. Birol and 
you, Mr. Mills. We have seen recent executive actions, Senator 
Barrasso mentioned them earlier when we were taking up the 
confirmation of Jennifer Granholm for Secretary of Energy, but 
these actions potentially jeopardize the very future 
development and production of U.S. fossil fuel resources. As we 
know, U.S. LNG markets, our exports are particularly important 
for markets in Asia. So the question to you both is, if future 
U.S. oil and gas exports are no longer available within the 
broader global market, this reduction in supply is going to be 
met elsewhere. And so, to you perhaps, Dr. Birol, what 
countries benefit the most from U.S. oil and gas exports and 
where will future supplies then come from if the U.S. cuts its 
exports?
    And then, following that, Mr. Mills, if you can speak to 
what a reduction in U.S. oil and gas production really means 
for the development of the global markets. I appreciate your 
views on this.
    Dr. Birol.
    Dr. Birol. Thank you very much. Thank you very much, 
Senator Murkowski, once again and thank you very much for your 
leadership in addressing one of the critical issues of clean 
energy, mainly energy efficiency best practices for households, 
for industry, for the transportation sector, with other leaders 
around the world.
    Now, if the United States' production is set to decline, 
and if there's still strong demand for oil around the world, 
the gap will be met mainly by the cheap cost Middle East 
countries. Having said that, when we look at the current oil 
demand numbers, as it is out of COVID, they went down 
substantially, and we do not expect that the demand will go 
there where it was before COVID in the next three or four years 
to come, just on that issue and there is a huge amount of spare 
capacity in the markets now which the markets can make use of.
    In terms of LNG, the flexible nature of U.S. LNG 
contributed a lot around the world and brought the price of gas 
down since the last few years and interestingly enough, the 
main purchaser of U.S. LNG today, by far, is China. From an 
emissions point of view, U.S. LNG, if it replaces coal in Asia, 
it can lead to significant emission declines, both in terms of 
CO2 emissions, but also for air pollution.
    Having said that, the methane emissions are very important 
here and it is very important to note that several customers 
around the world will soon look at the methane footprint of 
their gas exporters and therefore, it is perhaps an important 
task for the current Administration to take note of.
    Thank you.
    The Chairman. I appreciate that.
    Mr. Mills.
    Mr. Mills. Thank you, Senator Murkowski.
    I would say first that the IEA has been remarkably honest--
and I don't mean this as any surprise or shock--at outlining 
the realities of where the world's energy markets are going in 
the near term, both with respect to the demand for critical 
energy minerals, but also with respect to where oil and gas 
demand are trending given the nature of the world. So it's my 
go-to for--we'll call it honest analyses at the global level.
    Your question about what will happen to the U.S. and world 
development is, I think, a particularly appropriate one, as we 
know the demand for oil is not--and all the forecasts show--
it's not going to decline, it's going to roughly where it was. 
Who produces that oil and who's going to produce the natural 
gas, we know--I would add to the OPEC nations--Russia is the 
other principal beneficiary and some other African nations, but 
principally it's Russia and OPEC. The world divides 
simplistically into oil and gas, transportation and electric 
power, roughly speaking. And the United States' role in the 
transportation markets and the cost for people to get around in 
cars, we can distill our impact in a very simple way. We, in 
America, were essentially responsible for the collapse of world 
oil prices to the benefit of world consumers who drive and fly. 
There will be about a billion cars added to the world's roads 
over the coming couple decades. Even if all the existing cars 
become electric, which is going to be extraordinarily 
difficult, there will still be an enormous demand for oil--
markets, consumers, will want that oil to be cheap. We drove 
the price down.
    We can continue to drive the price down. It's essential to 
swing producers. That's what's happened. The United States 
became, in the last decade, to the total shock of the world, 
the swing producer. It's to the detriment of U.S. oil 
companies, by the way, because it means you're a price taker, 
you're not a market maker. Every time prices go up, as we all 
know, it's like Mardi Gras again in the oil fields and they 
start drilling and prices collapse.
    Natural gas is the go-to source of electricity for the 
world, not--the coal is still growing, as you all know, but 
natural gas is the go-to and there, as well, the U.S. shale 
fields directly caused the collapse in global gas prices. Just 
the anticipation of the U.S. entering global markets caused 
prices to collapse. Gazprom began negotiating and renegotiating 
new prices with Europe. The world benefited. The world's 
electric consumers benefited from American shale fields.
    Lastly, I'll note, in terms of development, the United 
States--and this sounds a little bit bombastic because, but I'm 
a Canadian as well as an American--the American oil and gas 
industry is the technologically most sophisticated in the 
world. It has path-breaking capabilities, not just to produce 
marginal oil and gas more inexpensively, but more efficiently--
which in the fuel cycle for carbon dioxide emissions matters-
and more environmentally sensibly. So we are the pioneers on 
that. If we push that oil production and gas production to 
parts the world which are not as cautious and not as good at it 
as us, the oil and gas will be produced there. It will be less 
efficient and less clean and probably more expensive, which I 
think is a net bad for the world.
    The Chairman. Mr. Chairman, thank you and Ranking Member 
Barrasso. I think both gentlemen have well pushed me beyond my 
time, but I think their responses and the reality of the role 
that the United States has played in a very dramatic way, very 
quickly, in terms of being that player in production, in what 
we have been able to do with our allies, is nothing short of 
extraordinary and I would certainly hate to see us go backward 
with that very significant and dominant role.
    Thank you.
    Senator Manchin. Thank you, Madam Chairman.
    And with that, Senator Heinrich has another conflicting 
committee meeting and I want him to take my time right now.
    Senator Heinrich. Thank you to the former and current 
Chairmen.
    Dr. Newell, the Ranking Member brought up the concern that 
embracing renewable power sources could lead to an unaffordable 
energy supply. Could you sort of walk us through the major 
sources of electric power generation today and how they stack 
up based on levelized cost of energy (LCOE)? In other words, 
what sources are most expensive today and what are the cheapest 
and what does that say about where we are going?
    Dr. Newell. Thank you, Senator.
    So there's been dramatic change over the last ten years or 
so in what's called the levelized cost of electricity 
production, which takes the upfront capital cost of building a 
new plant and also takes account of the fuel cost that you 
would use to operate a gas or a coal-fired plant and it puts 
those two things together and expresses it in, you know, 
dollars or cents per kilowatt-hour. So what we've seen is, as I 
mentioned in my testimony, a very, very substantial drop in the 
cost of both wind and solar power since 2009. Solar power has 
come down in its levelized cost by about 90 percent and wind, 
which had been thought of as actually a relatively mature 
renewable technology, has actually come down by about 70 
percent.
    What that has done is that it has really flipped on its 
head the relative stacking of where new capacity additions are 
coming from and whereas it was true in the past that natural 
gas was actually a favored, low-cost provider of electricity, 
that has changed substantially. What we've seen over the last 
decade is that renewables, both wind and solar are competing 
with natural gas for new capacity additions. The U.S. Energy 
Information Administration, which is where I look for constant 
tracking of this levelized cost of electricity, is coming out 
with its Annual Energy Outlook today. It hasn't been released 
yet, but in a preview of that the EIA kind of reconfirmed what 
it has shown over, you know, many years now, which is that 
renewable energy, in terms of new capacity additions for 
electric power, is taking increasing market share. And that 
looking forward, renewable power will actually be the majority 
of new capacity additions. That's without any future changes in 
policy.
    If you look at the other sources of electric power, natural 
gas tends to be there next--natural gas combined cycle. And 
then, coal and nuclear power, in terms of new capacity 
additions, are relatively more expensive now compared to both 
natural gas and renewables.
    Senator Heinrich. Obviously, we have seen a lot of stranded 
coal assets over the last few years. If the current trend 
continues with respect to the decline that we have seen 
historically in solar prices, as well as in wind generation 
prices, is there a risk that assets, gas assets in particular, 
that were financed with the idea to be 30-year assets, if they 
should be financed more on a 15-year or shorter timeframe--what 
is the risk of natural gas generation assets becoming stranded 
assets in the coming years?
    Dr. Newell. Yes, so the issue of what I would refer to as 
climate financial risk is an increasingly important 
conversation both in the investment community, of course, to 
you know, power producers and energy producers as well. So this 
is why it's important, I think, to lay out in advance what our 
future policies will be. Investment unfolds over time. These 
aren't sudden shocks to the system. As you alluded to, you 
know, new investments are made. They do last, you know, a 
significant period of time. They can last, you know, one, two, 
three, decades.
    But policy also evolves. And energy transitions also evolve 
over the course of years and decades. So I don't expect these 
to be sudden shifts. Whether or not there are stranded assets, 
that will depend upon if there, again, if there are sudden 
shifts and that investors can't anticipate what kind of cost 
recovery they'll get on their investments.
    Senator Heinrich. Dr. Birol, in its World Energy Outlook 
(WEO) analyses, IEA historically, fairly consistently, 
underprojected both growth trends and the cost reductions for 
renewable energy. While analyses, I realize, are based on 
different policy cases, IEA analyses historically predicted a 
linear path, but the shifts that we have seen, consistently 
actually since the 1970s on, have clearly been exponential 
paths, not linear paths. And I think this potentially points to 
the need for a reassessment of the scenarios or assumptions 
that are used.
    I know that IEA has made some changes to the WEO over the 
past couple of years, particularly in 2020, but I was hoping 
you could speak to those adjustments. What adjustments has IEA 
made in modeling or assumptions to improve projections of 
renewable energy in the future?
    Dr. Birol. Thank you very much, Senator Heinrich.
    I am very happy that you asked me this question again. So 
last time you had the same question. I want to repeat my 
answer, if I may. What we do is, Mr. Senator, we look at the 
projections if the governments do not change their policies, 
what kind of world we are facing, which we call our reference 
scenario or stated policy scenario. And here, with the policies 
governments are putting in place, we have seen a strong 
penetration of solar, but the level of the solar penetration 
was not high enough, not as much as we would like to see it to 
reach our climate progress. But in addition to that scenario, 
you might have missed that scenario----
    Senator Heinrich. Sure.
    Dr. Birol [continuing]. Which we call the sustainable 
development scenario. We have seen a huge increase of solar 
power. Indeed, only a few months ago I had the liberty to call 
solar the new king of global electricity markets. The reason I 
said so is that one, in the year 2020 of all the power plants 
installed in the world, 50 percent were solar. The other 50 
percent--all the other technologies put together, namely coal, 
plus oil, plus gas, plus nuclear, plus wind, hydro, 50 
percent--solar 50 percent. The main reason here is the 
governments are changing their policies, providing incentives 
to solar power and, as of today, as we have suggested in our 
sustainable development scenario, solar power is the cheapest 
source of electricity generation in many parts of the world.
    Just for you to note, Mr. Senator, on the 18th of May this 
year, the International Energy Agency will come out with the 
world's first roadmap to ``Net Zero by 2050''--what the energy 
sector would actually look like if the governments around the 
world take policies in order to reach net zero emissions by 
2050, which I expect that solar power will get the lion's share 
of the electricity generation, even much higher than what we 
said before, which is, I believe, good news for everybody.
    Senator Heinrich. Thank you.
    Senator Manchin. Thank you, Dr. Birol. Thank you, Senator.
    Senator Barrasso.
    Senator Barrasso. Senator Manchin, in terms of time 
constraints, if you would like to go next, that would be just 
fine with me and I am happy to stay. I know you have a conflict 
a little later.
    Senator Manchin. I appreciate it so much, Senator. And I 
will, and then I will turn the Chair over to you.
    This is to Dr. Hsu. I want all of you to think about this 
right now: the Paris Accord and the U.S. entering back into the 
Paris Accord. My understanding of the Paris Accord is there are 
different timetables for different participants. And now, with 
things changing since that started to where we are today, think 
about where we are and if we should all be on a level playing 
field. But my question is going to be, can the United States, 
can China, can all those in the Paris Accord meet the net zero 
carbon reduction by 2050?
    And I will start with Dr. Hsu because of her deep interest 
and deep involvement in the China energy market.
    Dr. Hsu.
    Dr. Hsu. Thanks so much, Senator Manchin, for that 
excellent question.
    So as you know, the Paris Agreement is formulated on this 
bottom-up process. And so, instead of the old Kyoto model, 
which is what we had in 1992, where there were these targets, 
these timetables that were agreed upon by all parties, the 
Paris Agreement decided to allow the countries themselves to 
determine what timetables and targets to meet for their 
nationally determined contributions, or their NDCs. And so, the 
science dictates or provides this broad picture of where we 
need to go as a world in order to hit these targets of 
containing global temperature rise, within 1.5 degrees Celsius, 
but the countries themselves can then determine what types of 
target years and commitments on climate change mitigation, 
adaptation, financing, what those look like. So----
    Senator Manchin. Don't you think--if I may interrupt, I am 
so sorry--with your knowledge that you have, especially with 
China being one of the greatest emitters, but all of us, if we 
are on a trajectory to hit that and China says they can, can 
the United States make it? Can China make it? And what should 
we be able to do to make enforcement for the other ones? If 
they are going to say we belong to the Paris Accord, but they 
are not going to attain any achievements whatsoever in meeting 
the net zero carbon by 2050, how can we enforce that?
    Dr. Hsu. So that's a really good point, and I think one of 
the major criticisms of the Paris Agreement is the fact that 
it's not legally binding. And so, because of that, then it's 
largely up to country governments themselves to implement laws 
and legislations to actually implement those particular 
policies to meet their goals.
    I think for China, one area and one reason why I have a lot 
of optimism--and we can see based on their track record that 
they will meet their Paris Agreement targets--is the fact that 
they have adopted their Paris Agreement goals within their 
five-year plans. And so, it's actually codified into binding 
laws at the very top level and then implemented at the local 
provinces. And so, I think we can have really a reasonable 
assurance that China will actually meet their goals because 
it's part of their law. And then the 14th five-year plan, which 
will be released in the coming weeks, is also expected to 
incorporate many of these energy and climate targets for the 
Paris Agreement to help them achieve their goals. And then 
also, we should be expecting an enhanced-ambition Paris pledge, 
an NDC that will also reflect the fact that they now have this 
longer-term 2060 carbon neutrality target.
    But then, even still, you're absolutely right that when you 
look at the climate models and the scenarios, all of these 
Paris pledges that countries have made, do not add up to get us 
to net zero by 2050.
    Senator Manchin. Right.
    Dr. Hsu. In fact, it's leading to about a 3.6 median degree 
Celsius warming world by 2100. And currently, we have about a 
97 percent probability that we're going to already overshoot to 
two degrees Celsius. So, absolutely, the targets and the 
pledges that are put forth in the Paris Agreement are 
completely inadequate.
    So that said, I think that's why it's important, and why 
China's net zero commitment, and exactly as Dr. Birol 
mentioned, many governments are making these net zero pledges 
and----
    Senator Manchin. The bottom line with China is they are 
keeping their own records. Do we know, do we have insight, are 
we seeing factual information and making sure that we are 
getting the correct information? And if I may, you might answer 
real quick on that because I want to ask if anybody else has a 
comment on this.
    Dr. Hsu. Yeah, I mean, I think that's also a major question 
that was an obvious sticking point in the 2009 Copenhagen 
negotiations--
    Senator Manchin. Yes.
    Dr. Hsu [continuing]. Where the U.S. really pressed China 
to open up its climate change and energy data and to have 
transparency on regiment reporting and verification in order to 
move forward on international climate agreements. I think one 
of the points that I want to emphasize is that we don't need to 
rely, necessarily, on official Chinese statistics and data to 
have assurance that they are meeting their climate goals.
    Senator Manchin. Okay.
    Dr. Hsu. For me, as a scientist, I use a lot of satellite 
remote sensing data, from U.S. satellites and also from the EU, 
for example.
    Senator Manchin. Wonderful.
    Dr. Hsu. And we can see, we can observe from space and use 
that data to see that China actually has been really effective 
in reducing, primarily, air pollution and other fossil fuel 
related----
    Senator Manchin. Thank you, Dr. Hsu. I am so sorry, but I 
have to see if any other of our witnesses have anything to 
comment on the Paris Accord, how we hold people accountable.
    Dr. Tinker. Senator, this is Scott Tinker from the----
    Senator Manchin. Hey, Dr. Tinker, go ahead, please.
    Dr. Tinker. Thank you.
    Yes, I think it's really important here, and I'll try to be 
very brief, to look at pledges and then look at results. And 
so, if you look at the Paris Accord, the U.S. response to that 
with the Clean Power Plan, we did not implement it, that was 
proposed. We were proposing to reduce by 32 percent our 
emissions in the power sector by 2030. We set a self-imposed 
base year, 2005, which was prior to 2007 in the United States 
for our highest emissions.
    We met that goal, that 32 percent reduction by 2030--non-
COVID-related--in 2020, ten years earlier. So the U.S. reduced 
700 million tons of emissions and continues to--How? Replacing 
coal with natural gas, renewables, solar, and wind. With state 
portfolio standards and other things and efficiency, but also 
exporting manufacturing, which doesn't count into the single 
global atmosphere. That's kind of a shell game.
    And so, how do you really do this? How do you actually 
reduce CO2 emissions? The United States has actually 
affected change faster than any other country who has pledged. 
Now, how do we continue to do that globally, I think you're 
asking. It's a very viable question and part of that comes 
from--something can be completely factual, but not factually 
complete. And I think that's what's happening with LCOE. Yes, 
solar and wind are the fastest growing sources in capacity and 
rate, but they're just getting started and everything grows 
exponentially early.
    In fact, solar and wind, since 2005, globally--and this 
comes from the IEA's own data, which are fantastic, by the 
way--have provided less than 25 percent of the growth in global 
electricity demand--so the other 75 percent of that growth is 
satisfied somewhere else.
    Natural gas is the fastest growing source of global 
electricity since 1985 by a lot, and there are reasons for 
that. But I think as we really converge on the scalability of 
these global solutions, we have to look at what actually 
reduces at scale emissions with everything that is being done 
now and there are many great opportunities to do that, but we 
want to be factually complete, not just completely factual.
    Senator Manchin. Thank you so much. My time is expired and 
if you all want to think about that, if I get a second round, I 
will have you all comment at that time. I am so sorry, but 
thank you.
    And with that, Senator Barrasso.
    Senator Barrasso. Thank you so much, Senator Manchin.
    Mr. Mills, many environmentalists insist that 
industrialized countries reduce their greenhouse gas emissions 
principally, if not exclusively, through the use of solar, 
wind, and electric battery technologies. They often fight, you 
know, coal, natural gas, nuclear power, hydropower projects. 
Can you discuss the costs to the environment if these 
industrialized countries attempt to reduce their emissions 
principally through just solar, wind, and electric battery 
technologies?
    Mr. Mills. Senator, I think that's one of the key issues 
that is the proverbial elephant in the room and the IEA and Dr. 
Birol have mentioned this, others have mentioned it. The work 
that I've done is looking at research that comes, in fact, from 
the U.N. Environment Program from the IEA, from the World Bank, 
from academic and research institutes, primarily in Europe, 
which asks that question--what is the impact on the environment 
broadly, not just carbon dioxide emissions?
    I spoke about carbon dioxide emissions because of a simple 
fact that since most of the world's battery materials are 
processed in China, and as we've heard earlier, from where two-
thirds of the grid there is coal-fired, that means that the 
energy to make battery materials emits carbon dioxide. And 
just, as a calibration point, making a battery and the 
materials for it that can store the amount of energy equal to a 
barrel of oil requires consuming about 100 barrels of oil 
equivalent of energy. So that consumption of energy just to 
build the battery, which doesn't produce energy, but stores it, 
has carbon dioxide emissions.
    But more importantly, to your point, it's not just that. It 
has water use implications, land use implications, and toxic 
mineral management implications because of the processes 
involved. In fact, the World Bank issued a report just two 
years ago, very concerned about what they called a gold rush 
for energy minerals in fragile parts of the world where it's 
easier to open up mines than in the European and North American 
continents, specifically because of the need for a whole host 
of materials, not just the rare earths that are famously or 
infamously talked about. Rare earths, as you know, are not 
rare, they have rare properties which are useful, but we don't 
mine them anymore, significantly, but it's also nickel and 
cobalt, very basic materials--the call on copper, which is one 
of the biggest minerals mined in the world--biggest in terms of 
quantities. Copper use doubles per car compared, for electric 
car, compared to a non-electric car for obvious reasons. It has 
more electrical equipment in it. Nickel use goes up because of 
battery's use of nickel.
    So the demand for nickel alone, which is not a rare 
material, goes up literally exponentially in the true 
exponential sense. It's going to have to come from somewhere. 
It'll have environmental impacts. I think we will probably not 
mine it here. I don't see any evidence that the United States 
is embracing the opening of new mines in a timeframe that will 
be meaningful. So it will come from Russia's Norilsk mine in 
the Arctic, which I'll just note and end on this point for the 
record, is where you could say that the world's first oil spill 
in service of electric cars happened already last year. There 
was a massive oil spill at the Siberian--Russian-Siberian 
nickel mine. The amount of oil spilled into the Arctic was 
almost equal to the amount of oil spilled from the Exxon 
Valdez, which was much more infamous and well known. It was the 
oil stored at the mine site to operate mine equipment and it 
caused a lot of angst, and properly so, in the environmental 
community of Russia.
    Senator Barrasso. So let me ask you this then, Mr. Mills.
    Last week, President Biden signed an Executive Order 
prohibiting new oil, gas, and coal leasing and permitting on 
federal lands and waters. Is there any reason to believe that 
that Executive Order by President Biden is going to reduce the 
amount of oil and gas that the world will consume?
    Mr. Mills. I could make that answer an easy and short one--
no.
    Senator Barrasso. No.
    Mr. Mills. There's no reason to believe that will happen. 
The world's consumption of oil, recovering particularly from 
the Great Lockdowns, is going to increase not decrease.
    Senator Barrasso. So is it fair to characterize President 
Biden's Executive Order as completely ineffective as a means to 
address climate change?
    Mr. Mills. It, as a practical means, is utterly 
ineffective. It will not reduce the consumption of oil or the 
emissions of carbon dioxide from the combustion of petroleum.
    Senator Barrasso. So then, is it fair to expect that 
President Biden's Executive Order is going to outsource 
American oil and gas production, the tens of thousands of 
American jobs that come with it, to foreign countries including 
OPEC members and Russia?
    Mr. Mills. The short answer is yes, but it also, by 
increasing the use of batteries here to offset the oil, if it 
were to be so mandated, we will also export jobs and economic 
development for that to those nations that make those minerals 
and materials, as I have outlined.
    Senator Barrasso. Thank you.
    One question for Dr. Tinker. U.S. carbon dioxide emissions 
have been steadily declining since 2007 and the International 
Energy Agency's most recent forecast expects U.S. emissions to 
decline by another 17 percent by 2030. Other industrialized 
countries are also expected to reduce their emissions by 2030. 
However, emissions in countries which have been defined as 
developing countries--and we can get into the issue of whether 
that is a good definition or not--they are expected to increase 
over the next ten years. In some regions of the world they have 
increased: 30 percent in Southeast Asia, 27 percent in India, 
14 percent in Africa.
    Is it accurate, Dr. Tinker, to say that all of the future 
growth in global emissions is going to come from these so-
called developing countries?
    Dr. Tinker. It is, but there's a reason for that. I think 
the United States and Western Europe--we built our fundamental 
economies on coal and oil for transportation and power 
generation. We've come to a level of wealth now that we're 
transitioning--decarbonizing coal and natural gas, oil and 
beyond. And so, the emerging and developing world, as they grow 
are also using coal as a reliable fuel. I don't fault that at 
all. It is lifting their economies from global poverty and 
creating the products that we all consume so we keep our 
emissions there to keep the stuff we want cheap.
    And so, how do we accelerate? How do China and Southeast 
Asia and nations that will follow, particularly India? India is 
just getting started. They passed the United States in coal 
consumption now, but are way behind China. And a number of 
people say, how did that happen? How can you accelerate into 
some other baseload dispatchable electricity stores in these 
countries? And that's really the great challenge before us, I 
think an opportunity for the United States to help lead, in 
many ways, this effort.
    So, yes, that's where the emissions are coming from. The 
goal is then to accelerate through that as you balance the 
energy and the economy and the environmental impacts as well, 
and it's doable, but not if we're not able to support 
technologically and economically and in leadership in the 
United States, for that to happen.
    Senator Barrasso. So if we want to help these developing 
countries reduce their emissions, would you agree that the 
United States should really develop technologies to lower 
emissions that we can then export these technologies so they 
would be used in these other locations around the world?
    Dr. Tinker. Technologies and energies. I have visited China 
many, many, many times throughout the last couple of decades 
and done work there, looking at their shale opportunities and 
natural gas, and other--they have natural gas resources but 
it's not at the level we--those exist in Russia, has already 
been mentioned--et cetera. LNG could bring some of that natural 
gas in as options in addition to the nuclear developing, the 
hydro and the solar and the wind. So it's resources as well as 
technologies. The United States needs an environmentally adept 
way to develop oil and gas. Oil and gas isn't clean--nobody 
ever said it was, nothing is, no form of energy is, but we are 
leading in that.
    And so, how do you accelerate and bring those technologies 
to the world such that they can skip the steps we went through 
to get to the high-density drilling, the high-volume 
extractions and the very small surface pads, minimizing use of 
the water and other kinds of things that need to happen for the 
extraction of fluids--and by the way, those are much more 
extreme than mining.
    Senator Barrasso. Thank you.
    Dr. Tinker. Absolutely.
    Senator Barrasso [presiding]. Thank you, Dr. Tinker, we are 
having a little bit of a technical problem with the feedback. 
With that, let me turn to Senator Hirono.
    Senator Hirono. This is for Dr. Birol. In your testimony, 
you highlight the need for ambitious actions and note that 
almost half of the emission reductions needed to reach net zero 
by 2050 will need to come from technologies that have not 
reached the market today. And you note the importance of 
American leadership. As you know, American leadership on clean 
energy is a priority for President Biden. What kind of 
ambitious incentives or mandates do you think the U.S. needs to 
put in place within the next year or two to remain a leader in 
emission reductions and clean energy technologies?
    Dr. Birol. Thank you. Thank you very much, Senator Hirono.
    This is an extremely important fact. In fact, Senator 
Manchin asked the Paris question, and this very much leads to 
the Paris question, how to reach the emission reductions, to 
reach emission reductions in 2050 to net zero emissions. So we 
need three things here. One, to make the most out of the 
existing clean energy technologies. What are those? Renewables, 
efficiency, nuclear power, these are the key ones, but these 
are as you said, Senator Hirono, these are not enough to make 
the emissions come to net zero by 2050.
    Senator Hirono. Right.
    Dr. Birol. As our analyses show, half of these emission 
reductions need to come from technologies which are not in the 
market yet.
    Senator Hirono. Yes.
    Dr. Birol. Therefore, the key word is innovation. What are 
those? For me, a critical one--perhaps the most critical one--
is carbon capture, utilization and storage. This is an 
extremely important one, looking at the current energy 
infrastructure we have around the world. Second, advanced 
nuclear power. Third, hydrogen. Fourth, the batteries, advanced 
batteries. And when I look over the history of the United 
States, innovation is in the DNA of the U.S. energy industry. 
In fact, U.S. industry in general, and I will look at the 
Internet, I look at the chips, the United States was at the 
forefront, so my expectation is the United States, not only at 
home, but internationally shows the leadership to push these 
clean energy technologies, which are not in place yet, but very 
important for the future. You have at the DOE wonderful 
laboratories across the country and they can play a particular 
role here in my view.
    Senator Hirono. Yes.
    Dr. Birol, the question was, you know, what kind of 
mandates or incentives should we put in place, because I know 
we are doing things to aid battery development, for example, 
but are there ways that we can incentivize the commitment to 
moving into those innovative areas that you are talking about? 
But let me just ask one more thing though. You talk about using 
existing technologies and one action that we can take today 
using technologies that are already on the market is to lower 
methane emissions from oil and gas wells. And in January 2012, 
an IEA report noted that reducing methane emissions from oil 
and gas operations is among the most cost-effective and 
impactful actions that governments can take to achieve global 
climate goals. However, the report notes that while reducing 
methane emissions may be cost-effective, many companies are not 
voluntarily doing so.
    There was, at one time, a federal methane regulation on the 
books to require companies to detect and reduce methane leaks. 
The Trump Administration repealed it last year. So how 
important do you think it is for the U.S. to resume regulating 
methane emissions, that being a very cost-effective way that we 
could use existing technology for the oil and gas industry? 
Should we reassert that regulatory requirement?
    Dr. Birol. Thank you very much, Senator.
    First of all, coming back to your first question, 
incentives for the clean energy technologies, which aren't in 
the market yet, it can be many ways. For example, this 
Committee, your Committee has for the CCUS, the 45Q tax credits 
was an excellent move in the right direction. And also, the 
economy recovery packages which will be coming soon, I hope 
they will provide incentives for the clean energy technologies 
plus the research and development budget for these technologies 
can be increased and some mandates can be deployed in order to 
give a strong push to clean energy technologies which aren't in 
the market yet.
    Now methane--thank you very much for referring to our 
report. Methane is a powerful greenhouse gas and especially is 
so, and when we look at the world, we said for the 
CO2 emissions, China is the number one country, but 
for methane, the United States is the number one country in 
terms of methane emissions, followed closely by Russia. And 
methane emissions reduction is not rocket science. You need to 
have the right regulations in place in order to minimize the 
venting and flaring, and methane is--all of it has a price--is 
a price of natural gas. What you need for this is to put in the 
right policies and mandatory framework. And I know that many 
companies are already making some efforts, but it's a major 
issue for the United States and many other countries, including 
Russia and other Middle East countries to address this issue.
    Our analyses show that a big chunk of the methane emission 
reductions are, as you mentioned, cost-effective and in effect, 
some of them are in the negative cost.
    Senator Hirono. Thank you very much.
    Thank you, Mr. Chairman.
    Senator Barrasso. Thank you, Senator Hirono.
    Now we have Senator Cassidy.
    Senator Cassidy. Thank you, Mr. Chairman and Mr. Ranking 
Member.
    Dr. Mills, there was a great exchange you had with Dr. 
Barrasso, but I just wanted to make it clear when we 
potentially don't deliver our oil and gas, we will shift 
production of the oil and gas to other countries with lower 
environmental standards, which is to say, per unit of oil or 
gas produced there would be more greenhouse gases emitted into 
the atmosphere. Is that a fair statement?
    Mr. Mills. The efficiency from a carbon dioxide perspective 
is typically lower in the other--all the other provinces. But 
the issue I was referring to was other environmental features--
water use, well water contamination, spillage, labor practices. 
The whole panoply of environmental issues about which we are, 
in America in particular, very cautious. Many nations aren't as 
cautious as we are. But your question about the carbon dioxide 
efficiency of primary energy extraction, as I said in my 
testimony, is actually rather complex. The issue is not that 
there isn't some energy used to produce energy, minerals, 
including oil, but who produces it because the world will use 
more oil in the future than it is in the present--for the near 
foreseeable future, a decade or two at least. If we don't 
produce it, your point is absolutely correct, others will, and 
it's not complicated to figure out who they are.
    Senator Cassidy. Yes, I see that.
    And you point out Russia, and we have seen with methane 
emissions increase from Russia and so, presumably, if they took 
over gas production you would continue to see that increased 
methane from Russia. Granted, I think Senator Hirono points out 
wisely that we need to decrease ours, but I have more faith in 
us making that commitment than I do in Russia.
    Mr. Newell, in your response to Senator Heinrich, you spoke 
about the levelized cost of electricity, but it is fair to say 
that that levelized cost of electricity for wind does not 
include the backup plans needed to address the intermittency of 
the wind and the baseload that would be required to run 
concomitantly. Is that true?
    Dr. Newell. Senator, yes. You know, one of the----
    Senator Cassidy. I have another question. I have limited 
time--
    Dr. Newell. Yeah, one of the inadequacies of the concept of 
levelized cost is that it doesn't directly address 
intermittency of different resources. And so, that you may----
    Senator Cassidy. Let me ask another question because I have 
limited time. What I don't know, does the price that is quoted 
for wind, is that a net of the federal subsidy that goes for 
the production tax credit or whatever is used? So, you know, 
it's not the true production cost, it is a production cost 
minus the subsidy. Is that correct?
    Dr. Newell. That's not correct, Senator.
    So the costs that I cited do not include the subsidies. If 
you include federal tax incentives or state-level renewable 
portfolio support, that would further reduce the cost. They've 
come down in real costs aside from tax credits and other 
support policies.
    Senator Cassidy. Thank you very much.
    Dr. Birol, I always enjoy your testimony. I enjoy all of 
your testimonies. You mentioned the reliable supplies of 
critical minerals and metals vital to energy transitions. I 
don't know this answer, but I have read that there is actually 
not enough cobalt in the world to completely go to an all-
electric vehicle standard. Is that true or am I 
misunderstanding that?
    Dr. Birol. Thank you very much, Senator.
    As I said a few minutes ago, we are looking at the impact 
of the ambitious climate policies on the availability of 
critical minerals in the next 10, 20 years or so. We are going 
to release this report in April. If you wish, I will be very 
happy to report to your Committee what the results are, what 
our intentions are, but currently it is not a major issue. But 
with the increasing demand, there may be clashes of supply and 
demand, number one. Second, there may be implications on the 
prices. And third, this can also lead, in some cases, to some 
energy security implications.
    But these are not issues that cannot be addressed, they can 
be addressed through different trading partners, I mean, 
reliable trading partners, putting in--stand ups and finding 
substitutes to those critical minerals. But as I said, we will 
come out with our report in April to show where the stress 
points are--what are the implications for the governments who 
are pushing clean energy transitions for their economies and 
for their energy security.
    Senator Cassidy. I look forward to that report. Thank you 
and I yield back.
    Senator Barrasso. Thank you.
    Senator Manchin [presiding]. Thank you, Senator.
    And now we have Senator King.
    Senator King. Mr. Chairman, we have been talking a lot 
today about the cost of transition to a new, lower carbon 
economy. I have a couple of slides, several slides, I would 
like to share that put this into perspective of the costs of 
not making this transition. If the tech people can put up the 
first slide for me.
    [Chart number 1 is displayed.]
    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
    
    Senator King. This is several hundred thousand years of 
CO2 in the atmosphere. Many people talk about 
natural variations, and as you can see from this chart, there 
are natural variations, but if you look at the far-right side 
of the chart, we are way outside of those natural variations, 
we are well above now 400 parts per million of CO2. 
This is a vivid demonstration of the fact that we are in 
uncharted territory. In fact, it is not really uncharted. Three 
million years ago was the last time we had 400 parts per 
million. And by the way, the oceans were about 60 feet higher.
    Speaking of the oceans, if you can put up chart number two.
    [Chart number 2 is displayed.]
    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
    
    Senator King. This is a really fascinating piece of data. 
This is 24,000 years of history. And the low point on the left 
is the height of the Ice Age. It was when a huge amount of 
water was locked up in the glaciers. And what you see is the 
increasing depth of the ocean. It is about 390 feet of 
difference between 24,000 years ago and today. There are two 
important things I want to point out on this chart. You will 
see in the middle there is a very steep incline of increasing 
water depth, called Meltwater Pulse 1A. The reason that is 
significant is that during that period, the ocean level rose a 
foot a decade and many scientists believe that we are in a 
similar moment right now. The point I am trying to make is this 
is not science fiction. This has happened in the past.
    And the other interesting thing about this chart is if you 
go over to the right where you see it sort of levels off at the 
top, that is the current sea level. It is about the last 8,000 
years. Eight thousand years happens to be recorded human 
history. In other words, the oceans have been where they are 
and we all think of them as being constant. The point of this 
chart is that in fairly recent times, 25,000 years, they have 
not been constant at all. The Chesapeake Bay, 15,000 years ago, 
was a nice river valley of the Susquehanna River. It was mostly 
dry land. So the whole East Coast would move about 180 miles 
east, 15,000, 20,000 years ago during the Ice Age.
    Here is the third chart, which talks about the practical 
effects of what we are looking at.
    [Chart number 3 is displayed.]
    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
    
    Senator King. This is ice concentration in the Arctic. It 
has reduced by 75 percent in the last 40 years. The point I am 
making is we are talking a lot today about the cost of 
transition. We also have to talk about the cost of not 
transitioning and the dramatic impacts that we are facing. You 
want to rebuild Miami or New Orleans or New York, Washington, 
DC, any coastal communities? If we are talking about six to 
eight feet of sea level rise in the next century, that is a 
catastrophe, both a human catastrophe and an economic 
catastrophe.
    We are talking about baseline in this hearing and I wanted 
to talk about the fact that we are in a very, very dangerous 
time and facing, what I think, could be catastrophic changes, 
if not within our lifetime, certainly within the lifetime of 
our children and grandchildren.
    A couple of questions:
    Dr. Hsu, Senator Barrasso mentioned this, given the 
magnitude of this problem and the fact that it is an 
international problem and that there are developing countries 
that don't have the technological and industry base that we 
have, wouldn't a good adjunct to the Paris Climate Agreement be 
technology sharing? This should be an international moonshot, 
if you will, to develop the technologies both for efficiency 
and for carbon-free production.
    Dr. Hsu, is that something we should be working on, bearing 
in mind, I have already used a lot of my time, but give me a 
couple of sentences on that, please?
    Dr. Hsu. Yes, I absolutely agree with you. Thank you for 
the question. But I also think it's not just about technology 
sharing and cooperation, but it's also about competition. We 
can also compete, as the U.S., in promoting clean technologies 
abroad and accessing markets that are now growing in their 
demand for clean technology because of their decarbonization 
goals and their targets on the Paris Agreement.
    So I think that permits even more opportunity for green 
competition as well, and not just technology sharing.
    Senator King. Great.
    Mr. Mills, I want to understand your testimony. You are 
talking about the costs of building batteries, for example. And 
I understand there are environmental costs. There is no free 
lunch in energy. I learned that a long time ago. However, are 
you saying that the emissions that go into the manufacturing of 
a single car battery would be equal to the emissions saved by 
that car battery in an electric car over, say, 150,000 miles of 
a ten-year life? Is that--I don't think you are saying that, 
but I just want to be sure.
    Mr. Mills. Senator, thanks for the question. I am saying 
that. In fact, there are very robust studies on this. I was not 
speaking to the economic costs, because the baseline I believe 
we were talking about was emissions. I was pointing out that 
the emissions associated with the energy consumed to fabricate 
batteries to make and process the key minerals and materials 
are significant that the data show and numerous academic--these 
are not, you know, studies promoted by advocates of either 
forms of energy. The analyses of what is involved in the fuel 
cycle to make the battery and battery materials, the range of 
energy cost--energy cost, not dollar cost--to fabricate 
barrels-of-oil equivalent of energy storage consumes 100 to 300 
barrels of oil of energy to fabricate that quantity of 
batteries. So that----
    Senator King. But my question is how many barrels of oil 
would be offset by that battery over a ten-year life?
    Mr. Mills. That's a very fair question. It does, it offsets 
over its life, oil. It depends on where the cars exist. In the 
world that exists today, batteries that are fabricated with 
those, the way we now do it, result in emissions that are only 
partly offset depending on where they're driven. One of the 
European studies finds that if you drive the Tesla in Norway, 
for example, half of the emissions savings that you have by not 
burning oil are wiped out by making the electric car. If you 
drive the vehicle in most of Germany, two-thirds of all the 
emission savings are wiped out and if you drive it in Poland, 
obviously, they have an electric grid that's coal-fired, then 
you have a net increase in emissions.
    So, yes, I was saying exactly that. That's what needs to be 
a part of the accounting.
    Senator King. Well, I would appreciate if you could supply 
those studies for the record for the Committee. I would be very 
interested in following up.
    Mr. Mills. Yes, sir.
    Senator King. One final comment, not a question. I know my 
time is up. I want to associate myself with Senator Hirono. The 
low-hanging fruit of climate change prevention is methane, and 
most of the methane comes from unregulated oil and gas 
drilling, whether it is in Russia or here. I think that is an 
area where we need to lead, but we also could be talking to 
Russia about some kind of methane treaty, if you will, because 
it is cost-effective. We ought to be doing it and it is, by 
far, the easiest, shortest, and most cost-effective way to deal 
with climate change.
    So, thank you. Thank you, Mr. Chairman.
    Senator Manchin. Thank you, Senator.
    Next, we have Senator Daines.
    Senator Daines. Thanks, Mr. Chairman.
    Since President Biden took office just two weeks ago, we 
have seen attack after attack on made-in-America energy and 
union jobs, and we know how devastating this will be to 
Montana's economy, Montana families, and the reliability of the 
electric grid. Just look at what California went through last 
summer as it relates to what happens when you take radical 
shifts to the left, and the lack of reliability that comes from 
those shifts. These actions could actually move us away from 
our climate ambitions. Today, the United States leads the world 
in reducing energy-related carbon emissions. We are number one. 
We have achieved this through innovation, not regulation. 
However, a recent report found that President Biden's ban on 
federal energy leasing will lead to a 5.5 percent increase in 
carbon emissions in the power sector by 2030.
    The cancellation of the Keystone XL pipeline, which has 
undergone extensive environmental reviews and would have 
achieved net zero emissions by 2023, will force major 
quantities of crude oil onto the rails, which now will emit up 
to three million tons of carbon dioxide annually into the 
atmosphere. Let me say that again. The cancellation of the 
Keystone XL pipeline could lead to an increase of three million 
tons of carbon dioxide emissions per year. By the way, any ban 
on fracking is also expected to drastically increase emissions. 
I am a chemical engineer by degree. I like to look at the 
numbers. The science tells us that these radical moves to the 
left are actually going to increase CO2, not 
decrease CO2.
    Mr. Mills, have technological breakthroughs like horizontal 
drilling and hydraulic fracturing lowered our emissions and do 
you believe that heavy-handed regulatory approaches, like the 
executive actions seen over the past two weeks, actually move 
us away from emission reduction goals?
    Mr. Mills. Well, thank you, Senator, for the question.
    Chemical engineering is one of the disciplines I respect 
enormously as a physicist. I chose physics because chemistry 
was hard.
    [Laughter.]
    So the answer is yes, of course. The hydraulic fracturing 
in the United States is so productive and so economically 
responsive--it's fast, which is non-trivial in capital 
markets--that it drove world prices of gas down, drove down 
domestic prices, and as most analysts know, the principal 
reason for the reduction in coal use in America is because gas 
got so cheap. So it is a profound impact globally. There is 
certainly a path to tremendous improvements yet in those 
markets, in terms of economic and resource efficiency.
    Senator Daines. Thank you very much.
    Just last week during a press briefing, one of President 
Biden's top aides, Gina McCarthy, stated, and I quote, 
``Climate change is the most significant public health 
challenge of our time.''
    Let me just state the obvious. We are in the midst of a 
global pandemic. So I would have to say this is certainly not 
the case. It was also not the case before the pandemic hit. The 
greatest indicator of health status is poverty and access to 
reliable, affordable electricity, which usually provides clean 
water. That is intrinsically linked to human welfare. The 
policies initiated over the past two weeks, which are being 
pushed by the left, only compromise energy access and jobs, 
which will now exacerbate the health and economic crisis that 
we are in now. They will lead to higher energy costs, higher 
gas prices for Americans at a time when families are struggling 
to make ends meet and keep food on the table.
    As shown by the U.S. reduction in emissions, it is possible 
to grow our economy and specifically, our energy sector, while 
meeting our environmental goals. In fact, in 2019, energy-
related emissions fell by 2.6 percent in the U.S. Meanwhile, 
China increased their emissions by nearly twice as much.
    Dr. Birol, can you speak to how U.S. carbon emission 
reductions compare to countries like China and India?
    Dr. Birol. Thank you, Mr. Senator.
    You are right, in fact, in the last decade or so, U.S. 
emissions declined significantly, mainly as a result of natural 
gas replacing coal, but also from a big push for renewables--
solar and wind. These were two main reasons. And today, U.S. 
emissions are half of that of China, globally. China is about 
30 percent of the global emissions, United States, 14. Having 
said that, if you look at it--because people look at emissions 
from different angles, the U.S. per capita emissions is one of 
the highest in the world, much higher than China.
    And I would like to say that I liked very much Mr. King's 
grasp of what would happen if we don't act. In addition to 
those, the implications on climate change, I can tell you that 
if the U.S. does not act, push to create an age of transitions, 
U.S. industry, U.S. technology may be well beyond the curve. 
Others are moving. It's not only a policy, but also market-
driven transitions. Therefore, the U.S. has been always the 
leader of innovation, new technologies, and I believe why the 
U.S. preserve this important, strong force in the global energy 
markets, pushing innovation would be also an economic idea in 
addition to playing an important role responsibly as a leader 
of the international economy.
    Senator Daines. Thank you, Dr. Birol.
    I am out of time, but let me just say this. In Montana, we 
have the nation's largest reserve of recoverable coal and 
large-scale coal plants. We are uniquely positioned in Montana, 
speaking of innovation, to be a leader in carbon capture 
research and development. Thirty-five percent of carbon 
emissions reductions have already been achieved in these high-
efficiency, low-emissions coal plants. So I am all about 
innovation. We have some great ways we could do that in 
Montana.
    Mr. Chairman, thank you.
    Senator Manchin. Thank you, Senator.
    And now we have Senator Cortez Masto.
    Senator Cortez Masto. Thank you, Mr. Chairman. Thank you 
for this conversation. This has been a fantastic conversation. 
And as always, I always learn something from my good friend, 
the Senator from Maine, Senator King. I have always enjoyed 
listening to his questions. But he nailed it for me, and this 
is why I think it is so important to have this discussion.
    I have been hearing the discussion here about the cost of 
transition versus the cost of not transitioning, but we have 
not talked about the benefits of transitioning. Here has been 
my concern all along as I have sat in for the last four years 
of the Senate is, I have watched China take advantage 
economically over the United States and other countries and 
they are still pursuing that, they are investing billions of 
dollars. This is an area we now, as the United States, when it 
comes to clean technology, have the ability to lead if we 
actually invest in the research, the development, and the 
deployment, because whoever can lead in this clean technology, 
whatever country has the best technology, is going to have a 
better economic advantage moving forward and we are 
transitioning, no matter what anybody says.
    I am going to stop preaching, but let me just say this. I 
am going to ask both Dr. Hsu and Dr. Birol--you know, part of 
the conversation that I think is important for the Paris 
Agreement is not whether there is enforcement, not whether we 
can ensure their carbon reduction, it is the fact that we are 
trying to achieve a goal here and incentivizing all of our 
states, all of our private sector, all of our government to 
work together to go down the path toward this clean energy and 
develop this new technology because this will create jobs, this 
will give us an economic advantage, and other countries will 
want to understand it as well or possibly be able to engage in 
that.
    Is that correct? What are the benefits for us entering into 
the Paris Agreement? And Dr. Hsu, let me ask you.
    Dr. Hsu. It's a great question and thank you so much, 
Senator, for asking it.
    You're absolutely right. If we look at China two decades 
ago, it basically didn't even have a clean energy sector to 
really speak of and then because of that massive amount of 
investment, they were able to, basically, eat all other 
country's lunch when it comes to producing solar, wind 
turbines, for example. I think I stated in my testimony that 
two-thirds of all wind turbines are coming from China, half of 
all solar panels are produced in China. So there's a huge 
market out there for these technologies.
    Some estimates that I've seen predict that by 2030, there's 
going to be a $23 trillion market for climate-smart 
investments, and so this will just continue to grow as 
countries, exactly as you said, work to meet the goals of the 
Paris Agreement. So, yes, I think absolutely by sticking to 
these old fossil fuel based industries that our economy has 
relied on to achieve the emissions reductions in the past 
decade, I think, it's short-sighted. I think the world is 
moving in the direction of decarbonization and if the U.S. 
doesn't act quickly and decisively enough, they're going to 
miss an opportunity.
    Thank you.
    Senator Cortez Masto. Yes, and with that said, I do 
understand. Listen, China is trying to decarbonize by 2060, but 
we also know China is continuing to invest in fossil fuels from 
emerging countries, right? So we know that the emerging 
countries right now are challenged and they are going to be 
transitioning, but right now, they are looking for the lowest 
cost. So it does make sense for us to work to figure out how we 
develop this technology for carbon capture, utilization, and 
storage and how we address the methane gas because it is not 
going to go away anytime soon, nor should we look to put people 
out of work, right? We want to transition to the jobs. We want 
to transition to the technology, the jobs of the future and 
transition those skills along the way. Everybody should be 
employed.
    With that said, let me ask Dr. Birol. For purposes of the 
Paris Agreement, you talked a little bit about the benefits of 
it--renewables, efficiency, nuclear power, advanced nuclear 
power--and you talked a little bit about incentives that the 
United States can engage in, including tax credits, as well as 
research, development, and deployment. What else should we be 
doing to ensure that we are incentivizing across the states in 
this space to develop the technology that is necessary for this 
clean energy?
    Dr. Birol. I think, if I may, Madam Senator, combining this 
question with your wonderful comments about the competition is 
very important here between the countries to develop the clean 
energy technologies. One lesson for the United States from 
history, we all agree today that the solar is one of the 
cheapest sources of electricity generation, and it was the 
United States which put--between 1975 and 2000--U.S. Federal 
Government subsidies, about $3 billion in order to bring the 
cost of solar down, from 1975 to 2000. And afterwards, if I may 
say so, dropped the ball and today, when we look at the 
picture, only one percent of the solar PV module shipments come 
from the United States and seven out of ten solar PV is coming 
from Asia.
    So I think we need to learn from this example. What kind of 
incentives? It can be tax incentives, it can be subsidies, 
mandates and some, in my view, some standards are needed. You 
talk about the methane. Methane--to capture methane is really 
an easy business. It is for the many companies--they just don't 
need to be greedy. They just need to put additional technical 
improvements reducing venting and flaring, which will happen 
only if there are regulations there. In my view, strict 
regulation on methane is a part of the incentives, if I may say 
so.
    Finally, Madam Senator, even if there was no climate change 
concern, I still believe that the United States would still 
push the advanced technologies to be a leader in the global 
economy because--and today if American manufacturers are 
changing their strategies--and pushing the electric vehicles, 
it is not only to save the planet, but it is also putting their 
businesses, their strategies on the right track to make money 
for themselves and for their shareholders.
    Senator Cortez Masto. Thank you.
    And Mr. Chairman, thank you. I know my time is up, but let 
me just say this. This is our moonshot. This is it. In this 
century, this is what we have to tackle. And I come from a 
mining state. I am very proud of the mining that we have. We 
have the ability to create new jobs around the critical 
minerals that are going to be necessary for this clean energy, 
from the extraction to the production, all the way to the end 
product. And we should be doing that. We should be engaging on 
how we continue to develop these new technologies from out of 
the ground to the finished product, because that is good for 
our economy, it is good for jobs, and it gives us that 
competitive advantage that I would like to see the United 
States lead with.
    So thank you.
    Senator Manchin. Thank you, Senator.
    Senator Hoeven.
    Has Senator Hoeven been able to get back? If not, we will 
go for a quick second round--anybody that might have--I have 
one to finish up on.
    Dr. Tinker. Mr. Chairman, this is Scott Tinker. Is my 
microphone working yet?
    Senator Manchin. It is now, yes.
    Dr. Tinker. Okay, I apologize. I'm not sure what happened 
there. I've got a lot to share on each of these topics.
    Senator Manchin. Okay, Scott. Well, we will get back to 
you.
    Anybody that did not have a chance to respond to my first 
question, if you recall, on the Paris Accord? Where we are 
going, different times, different elements, different people, 
many different countries meeting different timetables and 
hitting the net zero by 2050.
    Yes sir, Doctor.
    Dr. Newell. Yes, Senator. One of the things to recognize is 
that the concept of net zero and why has that gotten so much 
salience and the reason is that when carbon dioxide emissions 
are put into the climate system, they stay there for a thousand 
years, right? They don't go away. And so, the concept of net 
zero is that if we want to stabilize the climate and stop 
temperature from rising, we need to get to net zero emissions 
to stabilize the stock of greenhouse gases in the atmosphere. 
So, that's the--it's a very simple concept and it's, you know, 
it's gotten increased policy salience.
    Now the United States, and this has come up before, the 
United States--we contribute about 15 percent of global 
greenhouse gas emissions. It means 85 percent is coming from 
other countries. And so, how do we prevent the impacts on the 
United States, in our own self-interest, from climate change? 
How do we prevent additional sea level rise and temperature 
change? We need to do that both for our own actions and, very 
importantly, by encouraging actions by other countries, because 
85 percent of the impacts we're feeling are actually coming 
from other countries.
    So how do we do that? We have to engage in international 
agreements, like the Paris Agreement. And I think in order for 
us to expect other countries to react in kind, we need to lead 
by example. So that's what I would say, Senator. And finally, 
in terms of, you know, particular net zero goals, in order to 
stabilize the climate, I would think we need to get to net zero 
as quickly as possible. Exactly when that is, is going to 
depend on how technologies unfold, how policies unfold, how 
market conditions change. I guess I'd finally----
    Senator Manchin. There is nothing enforcement about the 
Paris Accord. That is the problem. There is nothing enforcing 
it whatsoever.
    Dr. Newell. Yes, the Paris Accord is based, as was 
described earlier, on bottom-up commitments by countries.
    Senator Manchin. Okay.
    Dr. Tinker, I don't think you have commented on this. Am I 
right?
    Dr. Tinker. I haven't----
    Senator Manchin. I know Dr. Hsu has. Dr. Tinker, please.
    Dr. Tinker [continuing]. Or maybe I did but you didn't hear 
me.
    Senator Manchin. Yes, we have you. We have you, Doctor.
    Dr. Tinker. Thank you. I probably was talking to myself, 
but thank you.
    You know, I think it's really important on the Accord 
optionality--so replacing CO2 dense emissions with 
less dense--and you have to think about those that are 
intermittent and those that are baseload as well. So replacing 
coal and natural gas has had a huge effect in the United 
States. Capturing the CO2 from that natural gas 
would have even more of an effect and then, supplementing that 
with other things.
    I think the levelized cost conversation, which didn't come 
through, we'd have to be complete on that. Again, when you have 
to back up materials, back up intermittent energy with 
something and it's 100 percent backup, plus or minus, in 
batteries or redundant plants. That raises the cost. It 
really--Dr. Birol knows this very well--that the levelized cost 
does not represent the cost to the consumer. It doesn't. That's 
why California and the Northeast U.S. and Germany pay so much 
more for electricity today, the consumer does. It's regressive.
    And it's not--it's just physics and economics. You have to 
back intermittent energy up if you want steady electricity. So 
we have to look at the complete cost of electricity. Density 
matters--a lot of stuff. I definitely respect and am very close 
with the state geologist in Nevada. And mining--it is 
important. We have to think candidly about how much mining we 
will enable here if we're going to manufacture stuff here--
where does it come from? I've put solar in, in Columbia in our 
film, ``Switch On'', a film on energy poverty. And it takes 
stuff from all over the world to do that, to bring it to it, to 
manufacture it and deploy it, the production chains for this 
are phenomenal.
    So how are we going to accomplish that globally to truly 
reduce emissions in a real world where others are making most 
of our stuff now in this country? It's such a practical 
question.
    Senator Manchin. Doctor, I hate to cut you short. I have 
two others.
    Dr. Tinker. Okay. Sure.
    Senator Manchin. If you don't mind.
    Dr. Tinker. You bet.
    Senator Manchin. We will get back.
    So I am going to go to Mr. Mills and then we are going to 
finish up with Dr. Birol real quick. I am sorry to indulge, but 
we want to get these out.
    Mr. Mills.
    Mr. Mills. Thank you, Senator. I'll take you at your word 
and answer the question about what do I think about the 
probability of reaching that goal by 2050. If I were betting, 
and I'll take the public bet, we won't reach the goal.
    Senator Manchin. The United States or all?
    Mr. Mills. Neither the United States or the world. And I 
say that not because it's aspirational, or should or 
shouldn't--aside from that entirely. The inertia in these 
systems, the world, is so great and the magnitude of the 
resources that we have to put to work is so large, that it 
would require efforts that are equivalent to a World War II 
type of mobilization, not just for a few years, but for 
decades.
    The physical resource requirements, and I look forward to 
the IEA study on this, I suspect it will look like other World 
Bank and IMF studies, are astonishing. I just don't think the 
world is prepared to mine that much material, move that much 
material, and spend that much capital. So I would bet against 
it happening. So that would argue that we have to start 
thinking seriously, as some organizations do, about resilience 
and adaptation to whatever happens to the climate in the coming 
decades.
    Senator Manchin. Thank you.
    And Dr. Birol.
    Dr. Birol. Thank you very much, Mr. Manchin.
    So I would like to bet either way. We are going to, as I 
said, making a study on the 18th of May, we are publishing, to 
see what needs to be done to reach net zero by 2050, and I can 
tell you that it requires Herculean efforts to reach that major 
transformation of the energy sector around the world, and one 
key word here--there are many, many challenges--but one 
important challenge, in my view, is there is a need for 
intelligent collaboration among the countries around the world. 
This is the biggest challenge. And if we don't come together, 
it will be very difficult to reach this target.
    And here, yet finally, one opportunity. Many countries 
around the world, including the United States, are putting in 
place economic recovery packages. Once-in-a-generation in 
scale, trillions of dollars, and many governments are putting 
incentives in for clean energy technologies. This can well 
create an unprecedented momentum for the clean energy 
technologies and try to give a strong support to reach those 
targets. But once again, it requires Herculean efforts to reach 
those targets, which, I believe, from the pictures of Mr. King, 
is compulsative for all of us to reach.
    Thank you.
    Senator Manchin. Thank you, Dr. Birol.
    We have Senator Hoeven and then Senator Barrasso will 
finish up the second round.
    Senator Hoeven.
    Senator Hoeven. Thank you, Mr. Chairman, I appreciate it 
very much.
    Dr. Birol, when you appeared before us earlier you talked 
about the importance of, in terms of fossil fuels, coal-fired 
electric plants providing a substantial amount of energy 
throughout the world and that is going to continue to be the 
case, and then emphasized that carbon capture and storage, you 
called, not just one of the most important technologies, but 
the most important technology that exists because of its 
ability to marry the benefits of good, normal stewardship and 
continued, dependable energy production. So I guess my first 
question is, do you stand by that statement? Is CCUS 
indispensable in terms of making sure we have dependable, low-
cost energy and meeting our objectives in terms of the 
production of CO2 emissions?
    Dr. Birol. Even more than before, Mr. Senator. It is 
getting more and more important, more and more critical, CCUS 
in power generation, industry and elsewhere. The problem is not 
energy. The problem is emissions. Energy is good. Emissions are 
bad.
    Senator Hoeven. Right, but isn't the demand for fossil 
fuels, coal-fired electric production, going to continue, 
particularly in a lot of countries outside the United States? 
And so, isn't cracking the code in terms of making CCUS 
commercially viable, which we can do here with our technology, 
isn't that vitally important, not just for us, but really for 
the world?
    Dr. Birol. Very much so. I think it will be not only 
important for the new power plants to be clean, but also for 
the existing power plants today. One-third of all the emissions 
in the world come from coal-fired power plants around the 
world. And if the United States was a leader of carbon capture, 
utilization and storage technologies, and it can well be a very 
important product for exported technology around the world. And 
this, this is what I would expect from the United States.
    Senator Hoeven. So we are trying to make that happen. Thank 
you for your comments and I agree with you and we are working 
hard to make that happen. We worked hard to get 45Q in place. 
So my question is, what kind of enhancements--and we are 
working on funding from the Department of Energy, loan 
guarantees--what else can we do, should we do, to make this 
happen? How do we help make this happen in the United States, 
lead the way forward, deploy it commercially, advance the 
technology and really lead the world here? What kind of things 
can we do to help make that happen?
    Dr. Birol. When I look at the numbers, 45Q seems to be 
working. We have seen several new projects coming online. Maybe 
an extension of 45Q and maybe providing additional incentives 
for the, especially for the industry sector--cement, iron, 
steel and others--who have to push the CCUS technologies and, 
as such, bringing the cost down. Today, the issue is not 
whether or not technology works, the issue is the cost of the 
technology. We just need to bring the costs down.
    As we have seen in the solar, learning by doing, we brought 
the cost down and with CCUS may well have the same pattern if 
there was leadership there.
    Senator Hoeven. So those would be the keys--enhancement of 
45Q, help through Department of Energy and other sources too, 
for the front-end cost to put this technology on the plants, 
and then loan guarantees to help those companies actually 
finance their costs to not only advance the technology, but to 
put it into place and operate on a commercially viable basis. 
Those, you think, would be the keys--make this happen instead 
of just talk about it, then we have to work with our Department 
of Energy and our companies to do those things, you would say?
    Dr. Birol. Yes, definitely, especially now the focus needs 
to be in the industry sector as well--iron, steel, cement and 
other special chemical industry--and we are going to, we are, I 
believe, working with the Department of Energy in order to 
provide them some assistance.
    Senator Hoeven. And you think that could have a huge impact 
for our country and that we could really lead the world 
forward--correct?
    Dr. Birol. Definitely. And the United States can be the 
leader of this technology around the world, and as such, not 
only benefits the U.S. economy, but in terms of reducing the 
emissions, keeping the energy in the United States, but also 
exporting this technology around the world.
    Senator Hoeven. And a lot of great jobs, right?
    Dr. Birol. Yes, exactly. CCUS is a job-creating machine.
    Dr. Tinker. Senator Hoeven.
    Senator Hoeven. Thank you very much, Doctor and thank you, 
Mr. Chairman----
    Dr. Tinker. Senator Hoeven, just briefly.
    Senator Hoeven. Yes, sir.
    Dr. Tinker. Technology matters with CCUS as well. So the 
ability to put fluids in at rate and in the volumes, and there 
again, the United States has a remarkable advantage--the Gulf 
of Mexico, where infrastructure exists and sites to capture, 
and then being owned by the Federal Government and the states 
in the offshore--is a remarkable site for large-scale CCUS. It 
could be world-leading in setting up a hub for capture, 
transmission, disposal, and monitoring and verifying its 
storage--50 gigatons of potential storage there. So we have a 
remarkable opportunity to lead that, but the geology does 
matter.
    Senator Hoeven. Thank you, Dr. Tinker, I appreciate that 
very much. And again, thank you, Mr. Chairman.
    Senator Manchin. Senator Barrasso.
    Senator Barrasso. Thank you, Mr. Chairman.
    Dr. Tinker, China is the world's largest emitter of carbon 
dioxide, and it accounts for about 30 percent of global 
emissions. So while Chinese emissions have been rising for 
decades, U.S. emissions, as we've talked previously, have been 
steadily declining since back in 2007 and are expected to 
decline another 17 percent by 2030. So in 2015, China said they 
are going to cap their emissions by 2030, so 2015 all the way 
up to 2030. Is it fair to say that China's pledge is really 
just business as usual for them?
    Dr. Tinker. Well, it's interesting. Yes, in some senses, 
but business as usual is really transition as usual. Nothing is 
static. So the transition in fuels is very real. China is 
transitioning. It's growing its economy on coal but will 
transition away from that. So it is business as usual in that 
transition. Accelerating through that transition is really the 
great opportunity the United States can lead, Senator, as we go 
forward here--is really helping to move through the emissions 
that Dr. Birol said so well, it's the emissions. And it's also 
the water, air, and land impacts. It's the environment that 
we're talking about, the whole environment.
    So business as usual is an interesting term, but nothing is 
business as usual.
    Senator Barrasso. Then, since you mentioned Dr. Birol--Dr. 
Birol, let me ask you this. The IEA's 2019 Energy Policy Review 
for the United States recommends that, it says, ``As the United 
States is poised for further production growth over the coming 
decade, facilitating the buildout of supporting infrastructure 
will be a key factor to maximize the benefits of shale, both at 
home and abroad.'' So, on balance, would you agree that the 
construction of natural gas pipelines, LNG export terminals 
here in the United States is a good thing for the United 
States, for the world, and for the environment?
    Dr. Birol. Yes, U.S. LNG, especially where it is exported 
to Asia, as I said a few minutes ago, as of these last two 
months, the biggest buyer of U.S. LNG is China, by the way, and 
other Asian countries. When it replaces coal it reduces the 
emissions. But once again, it is important that the methane 
emissions in the United States need to be addressed and 
minimized, otherwise soon there may be some challenges to find 
the customers as they may look at the methane footprint of U.S. 
LNG. But in general, it can help to reduce the emissions from 
coal and also help to reduce the air pollution in the cities in 
Asia.
    Senator Barrasso. Let me ask you, since the IEA was, I 
understand, created to ensure the security of energy supplies, 
particularly oil, the United States is now the world's largest 
producer of crude oil and natural gas. On balance, has the 
emergence of the United States as the top oil and gas producer 
increased the stability and security of global energy markets?
    Dr. Birol. Definitely, yes.
    Senator Barrasso. Thank you.
    Thank you, Mr. Chairman.
    Senator Manchin. And with that, I want to thank all the 
witnesses. You all have been wonderful. I appreciate the time 
you have spent to come here in person, but also those on the 
web. I appreciate very much you sharing with us your expertise 
and we are going to be calling on you much, much more during 
this Congress.
    With that, members have until the close of business 
tomorrow to submit additional questions for the record.
    The Committee stands adjourned.
    [Whereupon, at 12:30 p.m., the hearing was adjourned.]

                      APPENDIX MATERIAL SUBMITTED

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                             ECONOMIC RISKS

                                   OF

                             CLIMATE CHANGE

  The pages that follow can also be accessed online at the following 
web address:

    https://senwhitehouse.medium.com/economic-risks-of-climate-change-
sources-f9626ddff539
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