[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
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FEBRUARY 3, 2021
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[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the
Committee on Energy and Natural Resources
Available via the World Wide Web: http://www.govinfo.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
43-820 PDF WASHINGTON : 2023
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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
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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
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CLIMATE CHANGE
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