Greenhouse Gas Initiatives - Analysis of McCain-Lieberman Bill S.280 ‘The ClimateStewardship and Innovation Act of 2007’ Using the National Energy Modeling System

Abstract

Members of Congress have proposed a number of new aggressive plans for the reduction of greenhouse gases in the United States. Many of these proposals require reductions of 30% below current levels by 2020 and 60-80% reductions from current levels by 2050. While it is clear that achieving these proposed reductions will require major changes in U.S. energy infrastructure and technology implementation; it is only recently that quantitative analyses of the potential implications have become available. One of the critical questions to be addressed is the implications for various energy sources and technologies and the impact on energy prices to end users.

This paper reports on the impacts of pending GHG legislation on energy supply, demand, and prices, and the technologies and market mechanisms that are likely to be employed to reduce CO2 emissions. The paper also reports on the results of analysis of GHG bills performed by SAIC using the National Energy Modeling System (NEMS). NEMS is an economy-wide, integrated energy model that analyzes energy supply, conversion, and demand. NEMS is used by the U.S. Energy Information Administration (EIA) to provide US energy market forecasts through 2030, and is the principal tool for the analysis of energy and greenhouse gas policies used by the U.S. government.