Report Questions Impact of GHG Laws on Economy
legislation to reduce greenhouse gas emissions will have little impact
on America's future economic growth, according to a new report by
researchers at RTI International (http://www.rti.org) and Harvard University for the U.S. Environmental Protection Agency.
The report analyzes expected future economic adjustments associated
with the proposed Low Carbon Economy Act of 2007, Senate Bill 1766.
This measure, proposed by Sens. Jeff Bingaman and Arlen Specter, would
substantially reduce greenhouse gas emissions in the United States by
placing a cap on emissions from most parts of the economy, the
The bill includes both a trading system for emissions allowances and a
technology accelerator payment system to encourage cost-effective
reductions and reduce future uncertainties faced by businesses and
"According to our analysis using the RTI ADAGE model, the bill would
achieve emissions reductions with only a slight impact on economic
growth," said Martin Ross, Ph.D., an energy and environmental economist
According to the RTI analysis, enacting the bill would result in
forecasted growth for U.S. Gross Domestic Product over the next 40
years of 2.69 percent annually, compared with 2.72 percent without the
bill. Similar changes are estimated for growth in household
consumption, and energy prices are expected to be modestly affected.
Technological advancements such as carbon capture and storage from
electricity generation are an important component of meeting the
targets in the bill.
"Issues affecting the necessary economic adjustments include things
such as the availability of these new technologies and the extent of
international actions to reduce greenhouse gases in both developed and
developing countries," Ross said. "As written, the bill encourages
development of advanced technologies to lower emissions. It is also
important to note that the analysis focuses on costs of reducing
emissions and does not consider economic benefits associated with
preventing changes in climate."
The report is part of a five-year multiple-award contract RTI has with
the EPA to provide technical assistance and outreach services to the
EPA's Climate Change Division.