TODAY’S STUDY: The Ways To Get To Zero Emissions
Optionality, Flexibility, & Innovation; Pathways For Deep Decarbonization In California
April 2019 (Energy Futures Initiative)
SUMMARY FOR POLICYMAKERS
This study analyzes the options—described as “pathways”—for meeting California’s near- and long-term carbon emissions reduction goals. This analysis is designed to work within the parameters of existing state policy; it does not offer explicit policy recommendations.
California’s decarbonization goals include both economywide and sector-specific policy targets (Figure S1): Executive Order (E.O.) S-3-05 (2005) calls for an economywide emissions reduction of 80 percent by 2050 (from 1990 levels); Executive Order B-55-18 establishes a statewide goal of carbon neutrality by 2045; SB 100 (2018) requires 60 percent renewable electricity generation (excluding large hydro) by 2030, and net-zero-emissions electricity by 2045. Some policies are more prescriptive (e.g., five million zero emissions vehicles by 2030), while others are less so (e.g., 40 percent reduction of emissions economywide by 2030).
To develop decarbonization pathways and technology options for California, this study focuses on two targets, identifying separate but overlapping tracks: aggressive decarbonization by 2030 and deep decarbonization by midcentury, both from a 2016 baseline. Each target presents its own unique challenges and opportunities. To support these different tracks, the analysis emphasizes the value of technology optionality and flexibility. Over the longer-term, managing an economy that has the scale and sector diversity of California’s, and is deeply decarbonized, presents dynamic challenges that have not been addressed previously. For both the near- and long-term, engaging a range of stakeholders is key; energy incumbents and legacy infrastructures may slow the deployment of existing clean technologies in the near-term.
The top-level outcome of the analysis: California can indeed meet its 2030 and midcentury targets. Doing so, however, will require success across economic sectors (Electricity, Transportation, Industry, Buildings, and Agriculture), with multiple technologies contributing in each. Meeting the goals and managing the costs will require a strong focus on, and commitment to, technology innovation, flexibility, and optionality. This focus is essential for several critical reasons:
The energy system must provide essential services (light, heat, mobility, electricity, etc.) reliably at all times;
The current cost of many important low- and zero-carbon technologies is too high;
Energy delivery infrastructure must be available, reliable and secure as the system transforms;
Affordable negative emissions technologies will ultimately be important at large-scale for deep decarbonization and acceptable stabilization of the earth’s temperature; and
Success will require aligning the interests and commitment of a range of key stakeholders.
Looking to 2030, this analysis provides a comprehensive, sectoral study of policies and decarbonization options for California. The analysis identifies a portfolio of 31 clean energy pathways that cover all economic sectors in California—including the most difficult-to-decarbonize (e.g., Industry and Agriculture) —and assesses the emissions reduction potential of each (Figure S-2). The portfolio prioritizes technologies with strong technical performance and economics; and pathways that augment existing energy infrastructure are emphasized as they can offer significant benefits in terms of cost savings and market readiness. Detailed descriptions of each pathway are found in Part 2 of the report.
Meeting California’s long-term decarbonization targets—including an 80 percent economywide reduction (or more) by 2050 and carbon-free electricity by 2045—is extremely challenging. Managing and operating a deeply decarbonized energy system over a long duration and at the scale sufficient to meet these goals in an economy the size of California’s is technically very difficult; technology development timescales are unpredictable; technology cost curves constantly evolve; energy markets can change; public acceptance issues have been problematic in other locations and can contribute to substantial deployment and technology diffusion delays; the supporting infrastructure must be available and funded; and state and national legislative and regulatory environments can shift, constrain or promote technology choices.
The growing impacts of climate change on energy systems and new and changing supply chains for sustainable energy technologies must be accommodated in policies and planning; certain clean energy pathways are more susceptible to disruption, such as hydroelectric generation or power lines exposed to wildfires; and materials and metals needed for clean energy technologies may see price spikes or supply disruptions in the future.
These factors imply that detailed, bottom-up analysis of specific pathways, while instructive for meeting 2030 goals, have little value for informing the technologies needed to operate low- to zero-carbon energy systems by midcentury. The near-term focus should be on working as hard as possible to develop as many viable options, making it clear that innovation must be at the heart of a decarbonization strategy.
This report presents a “success model” for the longer term, strictly to illustrate both one of the many pathways that could meet long term goals as well as to demonstrate the overall difficulty of achieving midcentury goals without having a range of options for doing so. It identifies an analysis-based innovation portfolio for California, focused on technologies with long-term breakthrough potential. Technologies were screened based on California’s existing policies and programs, energy system and market needs, and other distinctive regional qualities that position California to be a technological first mover and global leader: a strong resource base; relevant workforce expertise; and robust scientific and technological capacity. Eleven breakthrough technologies were identified as major potential contributors to California’s deep decarbonization over the long-term, including hydrogen produced by electrolysis, smart systems, deep offshore wind, seasonal energy storage, and clean cement, among others. The work must pick up the pace today and be sustained to support their development.
MAJOR FINDINGS FOR AGGRESIVE DECARBONIZATION BY 2030
Meeting California’s carbon reduction goals by 2030 will require a range of clean energy pathways across all economic sectors—Electricity, Transportation, Industry, Buildings and Agriculture (Figure S-3)…
California’s ambitious policy to double economywide energy efficiency is an important step for meeting 2030 decarbonization targets…
Transportation is the single largest emitting sector in California and requires transformational change to achieve aggressive decarbonization by 2030…
Clean fuels (e.g., renewable natural gas [RNG], hydrogen, biofuels) are critical clean energy pathways due to the enormous value of fuels to flexible operations of energy systems. Fuels that are durable, storable, and easily transportable play a fundamental role in ensuring that all sectors can operate at the scale, timing, frequency, and levels of reliability that are required to meet social, economic and stakeholder needs…
California can meet its 60 percent RPS target by 2030 with continued expansion of wind (both onshore and offshore) and solar resources; some geothermal and increased imports of clean electricity (mostly hydro) will play a role, as well…
Natural gas generation will continue to play a key role in providing California’s electric grid with operational flexibility and enabling the growth and integration of intermittent renewables…
Policies that affect natural gas in some sectors (e.g., building electrification) may have unintended impacts on other sectors that consume and rely on natural gas. These impacts include price volatility; relatively higher infrastructure costs for those sectors that have limited near-term options for decarbonization; and reduced resource availability.
MAJOR FINDINGS FOR DEEP DECARBONIZATION BY MIDCENTURY
Meeting California’s deep decarbonization goals by midcentury will be extremely difficult (if not impossible) without energy innovation. This is due to many challenges that must be addressed, including:
Predicting the mix of clean energy technologies needed by 2050. This is extremely challenging…
Rising marginal costs of abatement. It is highly likely that these costs will increase over time as the lowest cost opportunities to reduce emissions are widely deployed…
Performance issues of deeply decarbonized energy systems. Managing a large, carbon-free electric grid offers challenges in terms of operation, design, size, and the growing, climate change-related uncertainty concerns about wind and hydro availability, for example. Also, scalable clean technologies are not readily available for meeting deep decarbonization goals in several key applications…
Cost-effective and efficient negative emissions technologies are needed by 2045…
There are several cross-cutting technologies or classes of technologies that can help meet the large-scale decarbonization needs for several economic sectors. These include technologies for: large-scale carbon management (LSCM); hydrogen applications; leveraging carbon infrastructure and expertise; and smart systems and platforms…
As a U.S. and global leader in clean energy, California is well suited to promote the development of an advanced clean energy technology portfolio. California has robust energy innovation infrastructure including an active private sector, strong workforce, world-class research universities, four national laboratories, and major philanthropies that are aligned with the goals of decarbonization. It has multiple supportive state entities, including the California Energy Commission, the California Air Resources Board, and the California Public Utilities Commission. A clear portfolio with specific priorities can help ensure that programs pursued by multiple stakeholders in California (and beyond) are timely, durable, and mutually supportive. This approach can give innovators a framework for assessing the prospects of a particular initiative and the steps needed to sustain critical innovations over long time periods. It can also give corporate adopters, financial investors, and policymakers visibility into the evolving future of clean energy. This work must begin today.
There are technology priorities with long-term innovation breakthrough potential that California should develop (Figure S-4); these include hydrogen production with electrolysis, advanced nuclear, green cement, and seasonal storage, among others. These technology priorities were screened based on California’s policies and programs, energy system and market needs, and other distinctive regional qualities that position California to be a technological first mover: a strong resource base, relevant workforce expertise, and robust scientific and technological capacity. A broader list of candidate technologies was also developed and organized by energy supply (electricity and fuels), energy application (Industry, Transportation, and Buildings), and cross-cutting technology areas (large-scale carbon management).
A REPEATABLE FRAMEWORK FOR DECARBONIZATION
This report is meant to advise California’s near- and long-term decarbonization strategy. It offers insights on decarbonization pathways, timescales, technology utilization, energy system operational needs, costs, energy innovation, and provides a comprehensive review of on-the-ground issues in California that may aid, or alternatively slow, California’s progress in deep decarbonization. In addition to benefitting California, there are high-level findings that may also provide a framework for decarbonization strategies that can, and should, be repeated in other economies around the world, including:
Energy system “boundary conditions,” including considerable system inertia that works against rapid change, complex supply chains, long-duration of technology development, and commodity business models must be taken into consideration when developing decarbonization strategies;
There is no “silver bullet” technology for deep decarbonization. Technology optionality and flexibility are critical to any decarbonization strategy, especially for the difficult-to-decarbonize sectors;
Existing carbon infrastructure and expertise must be aligned with deep decarbonization goals to prevent the creation of strong and dilatory political and business opposition to decarbonization pathways when acceleration is called for;
Decarbonization pathways should address multiple timescales, emphasizing commerciallyavailable technologies in the near-term and developing (and/or supporting the development of) new technologies with long-term innovation potential; and
Decarbonization pathways should support local and regional energy capacity that includes the existing workforce, the structure of economic sectors, clean technology firms, natural and scientific resources, and many other factors that shape the opportunities and challenges on-the-ground.