EPA Releases Economic Analysis of Lieberman-Warner Climate Bill

Washington, DC (March 14, 2008)- The Environmental Protection Agency (EPA) released a 189-page analysis of the Lieberman-Warner Climate Security Act of 2008 (S. 2191). The analysis includes ten different scenarios to evaluate a range of assumptions and key parameters. EPA found that under S. 2191 total US GHG emissions are approximately 40 percent lower than reference case emissions in 2030 (11 percent below 1990 levels) and 56 percent lower in 2050 (25 percent below 1990 levels). S.2191 covers 82 percent of total US GHG emissions in both 2030 and 2050.

The greatest emission abatement under S. 2191 occurs in CO2 emissions from the electricity sector. The price signal provided by S. 2191 is not high enough to cause large changes in the demand for transportation or changes in how transportation services are provided. In the S.2191 Scenario, modeled GHG allowance prices range between $61-83/tCO2e in 2030, and $159-220/tCO2e in 2050. Under S.2191, GDP is modeled to be 0.9 to 3.8 percent lower in 2030 and between 2.4 to 6.9 percent lower in 2050 than in the Reference Scenario.
Senator Joseph Lieberman (I-CT) said, “EPA’s detailed analysis indicates that the US can curb global warming without sacrificing economic prosperity. We will examine the results closely for improvements that they might suggest for the bill.” Senator John Warner (R-VA) said, “I am satisfied that EPA’s analysis demonstrates what we have long known: You can control greenhouse gas emissions in a manner that leaves the economy whole and is not burdensome on consumers.”
Critics of the bill say increases in energy costs would be borne disproportionately by those least able to afford it, including the elderly, poor and those on fixed incomes. EPA found that the bill would cause electricity prices to increase 44 percent by 2030 and gasoline prices to rise 53 cents a gallon by that year.
Related Resources:
EPA Says Carbon Caps Won’t Harm Economy Much
Lieberman, Warner Welcome EPA Findings that Climate Bill Gains Strong Results, Manageable Costs
EPA Analysis of the Lieberman-Warner Climate Security Act of 2008
Lieberman-Warner Climate Security Act of 2008 (S. 2191)