Policy implications of net-zero emissions: A multi-model analysis of United States emissions and energy system impacts

Many countries, subnational jurisdictions, and companies are setting net-zero emissions goals; however, questions remain about strategies to reach these targets, policy measures, technology gaps, and economic impacts. We investigate the potential policy implications of reaching economy-wide net-zero CO<sub>2</sub> emissions across the United States by 2050 using results from a multi-model comparison with 14 energy-economic models. Model results suggest that achieving net-zero CO<sub>2</sub> targets depends on policies that accelerate deployment of zero- and low-emitting technologies that have seen rapid cost reductions in recent years (including wind, solar, battery storage, and electric vehicles) as well as relatively nascent options (including carbon capture and storage, advanced biofuels, low-carbon hydrogen, advanced nuclear, and long-duration energy storage). While net-zero policies are likely to lower fossil fuel consumption, including considerable coal and petroleum reductions, achieving net-zero emissions does not necessarily mean phasing out all fossil fuels. Model results indicate that the Inflation Reduction Act's energy and climate provisions amplify near-term decarbonization but that net-zero policies have larger impacts on long-run outcomes. Stringent climate policy can have large fiscal impacts on tax revenue and government spending-revenues from carbon pricing and subsidies for carbon removal range from 0.1% to 3.7% of GDP in 2050 across models. Each dollar per metric ton carbon price leads to a 0.06% to 0.31% reduction in economy-wide CO<sub>2</sub> emissions relative to a reference scenario with current policies. Spending on energy across the economy decreases relative to today for many models under reference and net-zero policies, especially as a share of GDP, due primarily to end-use electrification and energy efficiency.

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Publication Details

Journal
Energy and Climate Change
Published
2025-04-22
DOI
https://doi.org/10.1016/j.egycc.2025.100191
Citations
10
Primary Topic
Climate Change Policy and Economics
Type
article
Field-Weighted Citation Impact
31.31
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Policy implications of net-zero emissions: A multi-model analysis of United States emissions and energy system impacts

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Policy implications of net-zero emissions: A multi-model analysis of United States emissions and energy system impacts

Geoffrey J. Blanford, Luis Sarmiento, P. Özge Kaplan, Daniel H. Loughlin, Yongxia Cai, Jeremiah X. Johnson, Megan Mahajan, Robbie Orvis, John Bistline, James McFarland, Matthew Binsted, Sharon Showalter, Frances Wood, Jay Fuhrman, John P. Weyant, Morgan Browning, Chioke Harris, Marc Melaina, Charles Rossmann, Ronald D. Sands, Gokul Iyer, Eric Stewart, Gale Boyd, Robert X. Gao, Haewon McJeon, Matteo Muratori, Christopher Hoehne, Allen A. Fawcett, Amogh Prabhu, Kathleen Vaillancourt, Jae Edmonds, Seyed Shahabeddin Mousavi, Yuan Mei, Aditya Sinha, Emma Starke, Trieu Mai
article en
10 citations

Abstract

Many countries, subnational jurisdictions, and companies are setting net-zero emissions goals; however, questions remain about strategies to reach these targets, policy measures, technology gaps, and economic impacts. We investigate the potential policy implications of reaching economy-wide net-zero CO<sub>2</sub> emissions across the United States by 2050 using results from a multi-model comparison with 14 energy-economic models. Model results suggest that achieving net-zero CO<sub>2</sub> targets depends on policies that accelerate deployment of zero- and low-emitting technologies that have seen rapid cost reductions in recent years (including wind, solar, battery storage, and electric vehicles) as well as relatively nascent options (including carbon capture and storage, advanced biofuels, low-carbon hydrogen, advanced nuclear, and long-duration energy storage). While net-zero policies are likely to lower fossil fuel consumption, including considerable coal and petroleum reductions, achieving net-zero emissions does not necessarily mean phasing out all fossil fuels. Model results indicate that the Inflation Reduction Act's energy and climate provisions amplify near-term decarbonization but that net-zero policies have larger impacts on long-run outcomes. Stringent climate policy can have large fiscal impacts on tax revenue and government spending-revenues from carbon pricing and subsidies for carbon removal range from 0.1% to 3.7% of GDP in 2050 across models. Each dollar per metric ton carbon price leads to a 0.06% to 0.31% reduction in economy-wide CO<sub>2</sub> emissions relative to a reference scenario with current policies. Spending on energy across the economy decreases relative to today for many models under reference and net-zero policies, especially as a share of GDP, due primarily to end-use electrification and energy efficiency.

Energy and Climate ChangeVol. 6
Joint Global Change Research Institute (US), National Laboratory of the Rockies (US), Environmental Protection Agency (US), United States Department of Energy (US), Electric Power Research Institute (US), Economic Research Service (US), Environment and Climate Change Canada (CA), North Carolina State University (US), Pacific Northwest National Laboratory (US), Korea Advanced Institute of Science and Technology (KR), Duke University (US), Simon Fraser University (CA), RTI International (US), Southern Company (United States) (US), Vatican Secret Archives (VA), Bank of Mexico (MX), RFF-CMCC European Institute on Economics and the Environment (IT), Inro Consultants (Canada) (CA), CMCC Foundation - Euro-Mediterranean Center on Climate Change (IT), Energy Foundation (US), Massachusetts Institute of Technology (US), University of Maryland, College Park (US), Stanford University (US)
Climate action
Openalex Percentile: Top 1%
Climate Change Policy and Economics
31.31
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