New Report on Paris Agreement Shows Tremendous Costs of ‘Keep It In the Ground’ Agenda in Ohio
It’s really remarkable that “keep it in the ground” groups are still pushing heavy-handed and punitive regulation as the only way to reduce carbon emissions when the rest of the country knows better. In the past decade, we’ve seen domestic energy production surge in the United States, and emissions fall to levels not seen since the 1990s.
This exceptional environmental outcome – made possible by horizontal drilling and hydraulic fracturing in deep shale formations – is a testament to sensible regulations at the state level that encourage scientists, engineers and other innovators to produce the energy we need in environmentally responsible ways. Ohio is certainly an example of the value in state level regulations, as Ohio’s regulations are in many ways more stringent than federal levels.
But groups like 350.org are only interested in shutting things down using the force of the federal government and even the United Nations. Take the group’s latest campaign, “Freeze New Fossil Fuel Development,” which claims:
“In order to meet the targets in the Paris Agreement and save the planet from climate devastation, immediately halt new coal, oil and gas development and finance a just transition towards a 100% renewable energy future for all.”
But a new report on the Paris Agreement released today shows just how much the state of Ohio would suffer if the “keep it in the ground” agenda – or just a fraction of that agenda – ever became the law of the land.
The report from NERA Economic Consulting shows the impacts of the Paris Agreement, reached in 2015 under the Obama administration, on the state’s industrial and manufacturing sector. It finds that the Obama administration’s sweeping climate regulations would not come close to meeting the agreement’s targets for the U.S. economy, meaning extra restrictions would have to be imposed on industrial firms and manufacturers.
Those extra measures would impose major costs on the Ohio economy, according to the NERA report, which was commissioned by commissioned by the American Council for Capital Formation Center for Policy Research with support from the U.S. Chamber of Commerce Institute for 21st Century Energy. In 2025, those losses would amount to:
- $9 billion in GDP
- 24,000 industrial jobs
- 110,000 jobs across the state economy
- $390 in average household income
And the NERA report warns those costs would be just the beginning. The jobs impact “could more than double in the medium term … and increase significantly in the long run,” according to the report, with similar trends for household income losses, too.
Nationally, the costs are simply staggering: $3 trillion in lost GDP and 6.5 million lost industrial jobs by 2040, according to the NERA report. Karen Harbert, president and CEO of the U.S. Chamber’s Institute for 21st Century Energy, recent said in a statement announcing the release of the report.
“This study does the analysis that the Obama administration should have done in the first place, and it finds that it is next to impossible to meet the Paris pledge gap without major new restrictions on the manufacturing and industrial sectors – restrictions that could reverse the manufacturing renaissance we are currently experiencing, pushing jobs back overseas.”
And sending those manufacturing jobs overseas, where environmental regulations aren’t as strict as those we have in the U.S., will just result in more pollution. This point was made clearly by Margo Thorning, senior economic policy advisor to the American Council for Capital Formation Center for Policy Research, who said
“[T]he regulatory approach is unlikely to succeed in reducing global emissions as our industrial and manufacturing activity will seek a more-friendly regulatory environment, thereby undermining U.S. climate goals,”
This is particularly problematic for Ohio, as manufacturing has just started to come back. For example, a steel mill in Ohio recently announced they are hiring, will those jobs be at risk if these new restriction on manufacturing and industrial sectors continue as planned by the Obama administration? What about the companies who have stated publically that their businesses are off to a good start this year, thanks to the oil and gas industry perking up and breathing new life into the Rust Belt, such as the announcement of Shell’s ethane cracker?
There’s simply no justification for stifling what has clearly been a great start to 2017 by these kinds of actions. The case for heavy-handed and punitive regulations gets even weaker when you consider the U.S. is already a world leader in cutting carbon emissions, thanks to commonsense rules and private sector innovation.
It’s little wonder, then, that President Trump during last year’s campaign, promised to “cancel” U.S. involvement in the Paris agreement.