As part of Climate Innovation 2050, C2ES led a group of companies in a collaborative exercise examining potential scenarios for decarbonizing the U.S. economy. The result is a set of three scenarios for reducing U.S. greenhouse gas emissions 80 percent from 2005 levels by 2050. A final report, Pathways to 2050: Alternative Scenarios for Decarbonizing the U.S. Economy, presents the detailed scenarios and a set of key takeaways.
Below are 1) quick descriptions of the three scenarios, 2) some results from our quantitative modeling of them, 3) key takeaways, and 4) a summary of key policies and other drivers in each scenario.
C2ES was joined in this exercise by colleagues at the RAND Corporation and at the Joint Global Change Research Institute (a partnership between the Pacific Northwest National Laboratory and the University of Maryland). More than two dozen leading companies across key sectors participated.
A Competitive Climate: Strong international pressure in the form of carbon tariffs and growing recognition of the competitive benefits of low-carbon innovation lead to a strong, early U.S. federal response, including an economy-wide price on carbon.
Climate Federalism: Responding to economic opportunities and intensifying climate-related disasters, a growing number of U.S. states implement ambitious climate policies, leading to calls from business for a more harmonized national response.
Low-Carbon Lifestyles: Increased urbanization, generational shifts, and technological breakthroughs lead to strong market demand for low- carbon consumption products and services, along with the emergence of innovative low-carbon business models.
Reducing U.S. emissions by 80 percent requires action across all the major sectors of the economy. The figure below shows emissions and negative emissions by sector for each scenario in 2030 and 2050.
Consistent with a broad range of previous analyses, the scenarios all reflect the same fundamental shifts: decarbonizing the power supply; switching to electricity and other low-carbon fuels in the transportation, industry and buildings sectors; increasing energy efficiency across the economy; increasing carbon sequestration; and reducing emissions of non-carbon climate pollutants.
The figure below illustrates, in the case of A Competitive Climate, the relative contributions of these emissions-reducing strategies toward an 80 percent reduction in 2050. The lower figure shows that their relative contributions are roughly similar across all three scenarios.
An initial set of scenarios built around different lead drivers — federal policy, state policy, and consumer and company action — got only halfway to an 80 percent reduction by 2050. The final scenarios assume a more ambitious response across a wider array of actors.
The figure below shows GHG reductions through 2050 in the initial set of scenarios (dashed lines) and the final scenarios presented here (solid lines).
Technological innovation can greatly facilitate decarbonization, but, without adequate policy drivers, is insufficient to achieve it.
The figure below illustrates that without policies to drive deployment, advances in low-carbon technologies produce only limited emission reductions. The bars show the level and sources of electricity generation in 2050; the circles show the associated GHG levels.
The Advanced Elec Tech case and A Competitive Climate both assume the same cost reductions in solar, wind, nuclear, carbon capture and storage, and grid-scale storage. Levels of deployment and resulting emission reductions are modest in the Advanced Elec Tech compared to the same technological advances paired with a carbon price and other policies in A Competitive Climate.
Decarbonization requires the adoption of new energy technologies and a shift in energy sources used across the economy. These figures (choose in dropdown menu) show how the energy and technology mixes compare across the three scenarios in the power, transportation, industry and buildings sectors.
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Pathways to 2050: Alternative Scenarios for Decarbonizing the U.S. Economy draws the following takeaways from this collaborative scenario exercise:
This table summarizes key policies and drivers in the three scenarios, including federal, state and local policies; business and consumer action; and technology innovation. More detailed descriptions of the specific elements of each scenario can be found in Appendix B of the report.
| A Competitive Climate | Climate Federalism | Low-Carbon Lifestyles | |
| Overarching Drivers of Change | Strong international pressure in the form of carbon tariffs, and growing recognition of the competitive benefits of low-carbon innovation, lead to a strong federal response, including an economy-wide price on carbon | Responding to economic opportunities and intensifying climate-related disasters, a growing number of states implement ambitious climate policies, leading to calls from business for a more harmonized national response | Increased urbanization, generational shifts, and technological breakthroughs lead to new low-carbon consumption patterns and the emergence of innovative low-carbon business models |
| Federal Government | Implements economy-wide carbon price starting 2024 Implements more rigorous vehicle emission standards Makes strong investment in low-carbon research, development, demonstration, and deployment (RDD&D) |
Implements economy-wide carbon price starting 2031 | Is supportive, but plays no proactive leadership role |
| State and Local Governments | Most states implement ambitious complementary policies, including building codes, transportation policies, and clean energy standards in the electric power sector | Carbon trading expands on the east and west coasts through 2030 Complementary policies are implemented after 2031, including clean energy standards and more stringent building codes |
Carbon trading expands on the east and west coasts through 2030 Highly urbanized states support cities’ ambitious policies, including by offering land-based sequestration incentives Cities make large investments in public transit, implement more stringent building codes, and implement zero-emissions vehicle mandates for ride-sharing services |
| Businesses | Driven by export opportunities, companies invest heavily in low-carbon technologies Companies engage in closer collaboration on RDD&D with the federal government |
Facing a fractured regulatory landscape, companies push for a federal response to level the playing field | New business models (e.g., “sharing economy,” distributed power generation) transform key sectors The power sector voluntarily reduces emissions by 85% by 2050 Finance favors low-carbon over high-carbon investments |
| Consumers | Consumers are willing to pay more for domestically produced low-carbon products | Consumer preference for electric vehicles increases | Improved carbon accounting and transparency enable consumers to easily act on growing preference for low-carbon products Dietary and other behavioral shifts occur (e.g., beef consumption decreases) |
| Technology | Federal RDD&D support lowers costs for nuclear, carbon capture and storage, grid-scale battery storage, and cellulosic biofuel | Low-carbon investment favors domestic technologies, including hydrogen and nuclear energy With lower incentives for innovation, more low-carbon technologies are imported |
Consumer demand and new, technology-enabled business models drive rapid electrification, greater efficiency in buildings and industry, and improved renewables integration |
| Rest of the World | Countries achieve International Energy Agency Sustainable Development Scenario targets in 2050 (OECD countries, 67% below 2005; non-OECD countries, 40% below 2005) | ||