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MIT Study Finds Health Benefits of CO2 Reductions Can Save 10x the Cost of Policy Implementation

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Cross posted from Scaling Green. For Blue Virginia readers, I’d just add that Gov. McAuliffe’s office should read this study as they consider how to move Virginia forward in terms of energy efficiency, renewable power, and of course meeting the EPA’s new rules for cutting CO2 emissions.

Clearly, we believe it makes sense to slash the air and water pollution that is inextricably linked to fossil fuel extraction, processing, and consumption.  We also strongly believe that moving from a dirty to a clean energy economy makes sense on a whole host of levels — economic, environmental, national security, health, etc. Yet opponents of a clean energy transition invariably raise claims that it will cost too much to do so, even though research has shown that fossil fuels are actually FAR more expensive than they appear to be, in large part because they are allowed to pollute without having to pay for doing so. Thus, the full “lifecycle cost” of coal to the U.S. public is actually upwards of $500 billion a year, but you won’t find that $500 billion a year incorporated into the price of coal, making it artificially cheap, and strongly skewing U.S. energy markets in favor of fossil fuels. Incorporate all the health and environmental “externalities” associated with fossil fuels, while taking away the enormous subsidies they receive from taxpayers, and it’s a totally different story — one in which clean energy would win by a wide margin.

Just in case you wanted even more evidence along these lines, a new study is out from researchers at MIT which finds that policies aimed at cutting fossil-fuel pollution can more than pay for themselves.

Lower rates of asthma and other health problems are frequently cited as benefits of policies aimed at cutting carbon emissions from sources like power plants and vehicles, because these policies also lead to reductions in other harmful types of air pollution.

But just how large are the health benefits of cleaner air in comparison to the costs of reducing carbon emissions? MIT researchers looked at three policies achieving the same reductions in the United States, and found that the savings on health care spending and other costs related to illness can be big – in some cases, more than 10 times the cost of policy implementation.

…The researchers found that savings from avoided health problems could recoup 26 percent of the cost to implement a transportation policy, but up to to 10.5 times the cost of implementing a cap-and-trade program…Savings from health benefits dwarf the estimated $14 billion cost of a cap-and-trade program…The price tag of a clean energy standard fell between the costs of the two other policies, with associated health benefits just edging out costs, at $247 billion versus $208 billion.

In sum, by implementing smart policies to cut CO2 emissions, not only do policymakers help head off disastrous global warming, they also reduce other forms of pollution in the process, saving enormous amounts of money on health care costs. How much money? Enough, depending on the policy, to more than pay for the policy’s implementation.  Who ever said you can’t get something for nothing? In this case, you actually get MORE than that — cleaner air and water, a habitable planet for future generations, sharply lower health problems and associated healthcare costs, as well as lower energy bills for consumers and a more competitive country in the world economy. If that’s not a “win-win-win” situation, it’s hard to know what is.