Although the House-passed clean air, clean water, clean energy jobs bill doesn’t have a big focus on the transportation sector, it does achieve real benefits in oil savings at low cost (see “EIA analysis of climate bill finds 23 cents a day cost to families, massive retirement of dirty coal plants and 119 GW of new renewables by 2030 “” plus a million barrels a day oil savings“). Some people have asked me for more detail on this, which I provide courtesy of this guest post from Jeremy Symons, Senior Vice President, Conservation and Education, National Wildlife Federation (bio here).
The U.S. Energy Information Administration (EIA’s) recent analysis of the American Clean Energy and Security Act (ACES) includes the first government estimates of the legislation’s impact directly on oil imports. A number of models, including the U.S. Environmental Protection Agency, have determined that ACES would save significant amounts of oil, but EIA is the first to project the specific impact on oil imports so that we can more directly assess the security and financial implications.
Overall oil imports would decline by 590,000 barrels per day by the year 2020 under ACES, according to EIA . This is roughly equivalent to the total amount of oil we imported from Iraq in 2008 (620,000 barrels per day). Over the next twenty years, America would save $650 billion on foreign oil (cumulatively through 2030). This is in constant 2007 dollars, and is calculated by applying EIA’s forecast of oil prices to EIA’s projected savings in oil imports.
ACES has many features to reduce our dependency on foreign oil, including strong investments to promote vehicle battery technologies and household smart grid connections to power our cars with electricity. EIA acknowledges that it wasn’t able to model a number of these features, so the actual oil savings would likely be larger.
[JR: I’d add that EIA, unlike the IEA doesn’t get peak oil (see World’s top energy economist warns peak oil threatens recovery, urges immediate action: “We have to leave oil before oil leaves us”). So it lowballs future prices. You can probably increase the numbers in this psot 50% for actual savings.]
In the meantime, the American Petroleum Institute (API) has reached new heights in misinformation by claiming that oil imports of refined oil products would go up under ACES. That is, we might import less crude oil but we will have to import more diesel or gasoline. Let’s set the record straight: EIA’s study of the Waxman-Markey American Clean Energy and Security Act determined that the bill would reduce imports of refined oil products by 20% by the year 2025. Environmental Defense Fund has valuable information on this topic at http://blogs.edf.org/climate411/2009/08/25/api-misses-the-mark-why-refineries-will-do-just-fine-under-aces/ — see also (see “Even fantasy-filled API study finds no significant impact of climate bill on US refining“).