Policy Solutions

Corporate Focus Areas

Policy Engagement
Corporate

Companies are producers and consumers—of electricity, fuels, products, and food. Public policy impacts them in both of these roles. Consequently, they can be powerful advocates for the practical policy solutions we need to reduce greenhouse gas emissions, address climate change, and bring clean, reliable, and affordable energy to everyone. It is critical that companies engage in policy discussions and help advance legislation, funding, and regulation that will reduce emissions as much as possible and keep the path to net-zero aligned with economic development priorities.

The most effective decarbonization solutions will come from coordinating private-sector leadership, advocacy, and action behind public policy. Breakthrough Energy has developed a robust set of resources for policymakers in the United States and Europe to use as they aim for net-zero emissions by 2050. These policies focus on transforming the five major economic sectors—electricity, manufacturing, agriculture, buildings, and transportation—responsible for most emissions.

Certain key policies, such as investing in R&D, incentivizing innovation and entrepreneurship, and putting a price on carbon, can spur transformational change across multiple economic sectors. These cross-cutting Priority Innovation Policies are essential to get the world to net-zero emissions by 2050.

Companies, too, will play a crucially important role in moving policymakers toward effective climate solutions.

For example, companies can:

  • Demonstrate support for and highlight the value of critical federal, state, and local climate policies required to achieve net-zero emissions.
  • Advocate directly through meetings with policymakers.
  • Join coalitions and industry organizations in support of climate policies.

Priority Innovation Policies

Today’s technologies have the potential to bend the carbon-emissions curve—but new, better, and cheaper innovations are a key component of any achievable plan for reaching a net-zero-emissions economy by 2050. In other words, accelerated clean energy technology is essential to halting climate change and limiting the rise of global temperatures.

Policy Spotlight: National Institutes of Energy Innovation

Government investment in clean energy research, development, and demonstration (RD&D) can accelerate this necessary innovation and catalyze greater private-sector investment. But current levels of public-sector RD&D funding are not enough to put the United States and the world on a path to net-zero carbon emissions.

To help address this funding deficit, we are working to create a National Institutes of Energy Innovation (NIEI), a government-led institution modeled after the National Institutes of Health (NIH) with a singular, coordinated mission focused on the development, commercialization, and early deployment of the clean energy technologies of the future. NIEI’s key organizing principle would be to connect basic science with the translational and demonstration programs that are necessary to build the tools needed to prevent the worst impacts of climate change, while setting the U.S. up as a technological and market leader in this sector.

At its core, NIEI would:

  • Grow annual clean energy RD&D funding across the federal government to $35 billion in order to achieve the level and pace of innovation required to achieve net-zero emissions by 2050;
  • Organize federal energy RD&D priorities to be end-use inspired rather than fuel-inspired to improve outcomes, efficiency, and coordination of research;
  • Match RD&D funding to fit the current energy decarbonization challenges to facilitate the potential for game-changing breakthroughs in innovation; and
  • Create pathways for technology demonstration and early deployment to support market success.

Learn more about the National Institutes of Energy Innovation

Priority Innovation Policies

Electricity

Electricity is an essential part of modern life: it powers our homes, schools, stores, offices, hospitals, and factories. Electricity generation is also the second-largest source of greenhouse-gas emissions in the United States. In 2017, it accounted for 30 percent of emissions.

For decades, coal generated roughly half of our electricity, with oil, gas, nuclear, and hydro generating the other half, but this power mix has begun to shift. The recent shale boom has doubled natural gas’s share of power generation in the U.S., and wind and solar generation are increasing, too. At the same time, energy efficiency is helping to flatten the demand for electricity.

These changes have reduced GHGs, but continued progress is not guaranteed. To reach net-zero emissions, we must first decarbonize electricity generation and then adopt carbon-free electrification across all sectors of the economy.

Policy Spotlight: Building the Macro Grid

We need to bolster the reliability and resilience of power systems, enable the use of more variable renewable energy (VRE) sources such as wind and solar, and help provide the necessary infrastructure for wide-area power exchange across the country. As such, the governments should support the development and deployment of a macro-grid that can expand transmission infrastructure.

Learn more about Building the Macro Grid

Other ways companies can advance electricity policies:

  • Improve the design of electricity markets by engaging Regional Transmission Organizations (RTOs)
  • Advocate for clean electricity standards at the federal and state level
  • Include energy storage in integrated resource planning

Electricity Policies

Transportation

The internal-combustion engine revolutionized transportation: increasing human mobility, opening new educational and economic opportunities, and facilitating the movement of goods around the world. But that mobility has come at a steep cost to the climate. Fossil-fuel combustion in cars, trucks, trains, planes, and ships is the leading source (32 percent in 2017) of GHG emissions in the U.S. While cars are the largest source of transportation emissions today, trucks, planes, and ships are the fastest-growing sources.

We cannot mitigate the most catastrophic impacts of climate change without decarbonizing transportation. Doing so will require a complete transformation of the way goods and people move from place to place.

The key components of this transportation revolution are electrification, low-GHG liquid fuels, and more-efficient mobility. Electrification (plus a decarbonized grid) is one of the most promising solutions for vehicles that travel shorter distances between refueling. For longer-distance and off-road applications, low-GHG liquid fuels can accomplish the same goal. More-efficient vehicles and increased access to transit are also essential components of a comprehensive transportation-decarbonization strategy.

Smart, well-designed policies can shape the technology and investment decisions that will put the entire U.S. transportation sector on a path to net-zero.

Policy Spotlight: Clean Fuel Standard

A Clean Fuel Standard (CFS) requires the producers and importers of fuels used in transportation to reduce their greenhouse gas (GHG) emissions over time. As a performance-based standard, a CFS encourages the use of low-carbon transportation fuels based on their carbon intensity (CI), or their lifecycle GHG emissions per unit of energy.

Learn more about a Clean Fuel Standard

Other ways companies can advance transportation policies:

  • Promote public investment in electric vehicle infrastructure and low carbon fuels.
  • Advocate for zero-emission vehicle mandates at the federal and state level.
  • Support fuel-efficiency standards for vehicles.

Transportation Policies

Manufacturing

Manufacturing—the cement in our buildings and bridges, the steel in our cars and appliances, the clothes we wear, the books we read, the plastic toys and containers we buy—directly accounted for 23 percent of GHG emissions in the U.S. in 2017, making it the nation’s third largest source after transportation and power generation. (That number includes emissions from the production, transportation, and transformation of oil and gas, but not from the combustion of those fuels in buildings, power plants, and vehicles. It also excludes emissions associated with the generation of electricity used in industrial processes.)

To get our manufacturing sector to net-zero emissions, policy action needs to encourage the development and deployment of new technologies. Low-GHG technological options in this sector are more nascent than in power generation, buildings or transportation, and there are fewer existing policy levers to speed their development. Fortunately, more opportunities are emerging to decarbonize manufacturing—including electrifying processes that currently use fossil fuels, developing low-GHG alternatives to fuels where electrification isn’t cost-effective, increasing efficiency, deploying carbon-capture technologies, and reducing methane emissions from the production and transportation of oil and gas.

Policy Spotlight: Buy Clean

Buy Clean is a public procurement policy aimed at infrastructure and building materials. Its goal is to rapidly reduce greenhouse gas (GHG) emissions embedded in the products government entities buy. It is a powerful tool to incentivize the purchase of low-carbon materials from manufacturers. The proposed policy framework sets a performance-based standard based on carbon intensity (CI), which includes the direct emissions from a product’s production, transportation, and use.

Learn more about Buy Clean

Other ways companies can advance manufacturing policies:

  • Promote public investment in low-carbon manufacturing technologies.
  • Advocate for standards to reduce emissions.

Manufacturing Policies

Buildings

Buildings emit carbon in two ways: through their daily use (known as operational carbon emissions) and via the manufactured cement, steel, and iron used to make them (known as embodied carbon emissions). Operational carbon emissions can be reduced over time, as things like HVAC systems become more energy efficient. Embodied carbon emissions, by contrast, are locked in place as soon as a building is built. That means we can’t decarbonize the buildings sector without getting the manufacturing sector to net-zero at the same time.

To reduce building emissions, we need policies that encourage the deployment of new technologies such as low-GHG building materials and ultra-efficient heat pumps and that create incentives for the electrification and improved efficiency of clean technologies that already exist.

Policy Spotlight: Building Codes and Standards

It is critical to build all newly constructed buildings to zero-emissions standards as soon as possible instead of continuing to lock in inefficient operations and the emissions that result. Building to these standards is also significantly more economical than paying for retrofits in the future. Governments should use building codes or other authorities to require all new construction (residential and nonresidential) to be highly efficient, all-electric, and zero emissions by a certain year.

To support the broader decarbonization of other sectors, building codes should incorporate additional design considerations, such as charging infrastructure for electric vehicles, demand-response and load-flexibility technologies to improve grid reliability and promote renewable integration, and low-embodied-carbon construction materials.

Learn more about Building Codes and Standards

Other ways companies can advance buildings policies:

  • Support public deployment of heat pumps and electric building equipment.
  • Advocate for standards to reduce buildings emissions.

Buildings Policies

Agriculture

American farms are some of the most efficient and productive in the world: the U.S. is the world’s second-largest agricultural producer and its largest exporter of food. But right now, direct emissions from agriculture comprise more than 8 percent of total U.S. emissions. Soil is the largest single source of these agricultural GHG emissions (49 percent), as fertilizers and other soil-management practices release nitrous oxides (N2O) into the atmosphere; the second largest (44 percent) is the methane produced by livestock raised for meat and dairy production.

Slowing agricultural emissions while still meeting growing global demand for food will require significant innovations in agricultural practices. On the supply side, new technologies, practices, and policies will need to increase efficiency, reduce the use of fertilizers, increase carbon sequestration through soil management, and cut methane emissions from livestock. At the same time, demand-side measures can minimize the consumption and waste of GHG-intensive foods.

Policy Spotlight: Soil and Nutrient Management

Roughly half of all agricultural GHG emissions in the U.S. come from soil-management practices such as tillage, fertilization, and irrigation. However, numerous scientific studies show that management systems designed to improve soil health can also aid carbon sequestration and reduce GHG emissions. At the same time, they provide important environmental co-benefits: they can improve water quality, suppress pathogens, and support safer pollinator habitats and biodiversity in general. They can also benefit farmers and ranchers by increasing a soil’s available water-holding capacity and nutrient availability, improving drought resilience, reducing input costs, and mitigating erosion. Scaling up these practices can increase carbon sequestration and reduce GHG emissions across the agricultural sector.

Learn more about Soil and Nutrient Management 

Other ways companies can advance agriculture policies:

  • Support public investment, incentives, and programs to reduce agricultural emissions.
  • Promote policies that level the playing field for alternative proteins.
  • Advocate for public programs to reduce food waste.

Agriculture Policies

Carbon Removal

Carbon removal includes the natural and technological processes that remove excess carbon dioxide from the atmosphere and store it permanently underground, in trees and soils, or in durable products, reducing net emissions into the atmosphere. For instance, natural, ecological processes such as photosynthesis enable carbon-dioxide storage in trees and soils. Conversely, when forests are degraded, and lands are poorly managed, net global carbon emissions increase. Since 2005, the amount of natural carbon removal in the U.S. has remained relatively constant. It currently removes enough carbon to offset about 12 percent of the country’s carbon-dioxide emissions.

Policy Spotlight: Expansion of a Carbon Sequestration Tax Credit

Section 45Q is a federal tax credit that helps advance the market for carbon capture and technological carbon removal in the United States. The 2018 Budget Deal increased the financial incentives for carbon-removal projects via 45Q: the updated tax credit provides $50/ton of CO2 captured for geological storage and $35/ton of CO2 captured for enhanced oil recovery or other utilization purposes.

Despite this boost, the policy as it exists today is still not enough to incentivize large-scale deployment of carbon removal technologies, such as carbon capture and direct air capture (DAC).

Learn more about the Carbon Sequestration Tax Credit 

Other ways companies can advance carbon removal policies:

  • Support public investment in RD&D for carbon removal technologies.
  • Promote programs that support natural sequestration on working and public lands.
  • Advocate for deployment policies that support direct air capture, like a clean fuel standard.

Carbon Removal

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