Sprinting Ahead: Just 5 Policies Get States About Two-Thirds of the Way to Key Climate Goals
Addressing the threat of climate change can seem overwhelming. In coming years, risks will grow — and the reality is communities across the United States are already grappling with rapidly worsening floods, wildfires, and drought.
The solutions needed to address climate change can seem overwhelming too, but it only takes a few bold policies — five to be exact — to get US states most of the way there.
States have always been a critical driver of action on climate. They can move faster than the federal government, making them a laboratory to test what could work at a national scale. States also have broad authority to drive emissions reductions in the power sector, transportation infrastructure, and buildings. Many have already started to enact a diverse array of climate policies.
Over the past two years, RMI has analyzed pathways to achieve climate goals in states big and small, red and blue, urban and rural. Since every state is different, the map to climate alignment will be unique for each one — but some major themes and key areas hold true for all states.
We have found that five policies can deliver about two-thirds (on average) of the emissions reductions states need by 2030.
1. Invest in Clean Electricity Infrastructure
Wind and solar are now the cheapest form of new electricity capacity in almost every situation. Continuing the use of nearly all existing coal-fired electricity generation is more expensive than building new wind and solar generation. The economics of building new gas plants aren’t favorable either.
Foundational policies like those that set requirements for clean electricity generation (clean electricity or renewable portfolio standards) can define an ambitious but realistic schedule for investment in renewable capacity and energy storage. To lead clean energy development and meet climate goals, states should plan to generate 80 percent of electricity from clean sources by 2030 — widely considered an ambitious but achievable target (and in line with what we modeled).
2. Replace Air Conditioners, Furnaces, and Water Heaters with Heat Pumps
Most household energy consumption comes from heating, air conditioning, and water heaters. Heat pump technology can deliver the same level of indoor comfort and provide hot showers more efficiently using electricity — especially as power sources gets cleaner (see item 1 above). Heat pumps are also cheaper over the life of the appliance in many cases, especially as the cost of running gas furnaces and water heaters rises with gas commodity prices. Replacing air-conditioning units with heat pumps (which can cool and heat) can eliminate most emissions from heating.
For a single, bold policy that can address both new and existing buildings, a clean appliance standard based on air quality would get this improved technology into homes at time of replacement or at time of construction.
These standards could be phased in over time in different markets — eventually reaching every market by 2030 at the latest. The easiest places to start are new construction and replacing oil and propane furnaces and inefficient electric resistance heating — all applications where the technology is ready and the economics are clear now. Accelerating adoption will drive down costs over time as production scales and installers become more efficient. States should offer financial assistance for low-income households in any markets where up-front costs could be a burden.
By going all-electric, we can also reduce our reliance on methane in buildings, which is a key driver of indoor and outdoor air pollution.
3. Lay Out the Welcome Mat for Electric Vehicles
Transportation is now the largest source of emissions in the United States overall and in 26 states individually. Meanwhile, the number of electric vehicle (EV) models available has grown and the economics now make them a mainstream option. These factors are driving more EV adoption, but reducing emissions at the scale and speed needed requires the EV revolution to happen even faster.
To get to full EV adoption sooner, states can adopt California’s Zero Emission Vehicle and Advanced Clean Trucks rules to phase out sales of all gasoline and diesel options for cars and other light-duty vehicles by 2035 and for medium- and heavy-duty trucks by 2045. These standards are already proving effective in the 18 states that have implemented them. Standards will help the auto industry too — creating regulatory certainty that the industry can use to plan for the future.
States can also offer point-of-sale rebates, tax credits, or utility incentives to consumers. Lowering the cost of going electric is especially important to support equitable access to clean transportation options for low- and middle-income households. A critical enabler for EVs is charging infrastructure. New federal infrastructure funding, along with substantial private-sector investment, will make massive capital available to install charging infrastructure across the country. Finally, it’s critical to note that we also need to reduce how much we travel in vehicles by 20 percent by 2030.
4. Drive Efficiency and Electrification in Industry
Industrial activity — such as cement, steel, and petrochemical production — makes up 24 percent of national emissions and includes some of the most difficult sectors to decarbonize, given the high up-front cost of industrial equipment and the many processes that require high levels of heat.
Industry can shift from burning fossil fuels to electricity for operations and many process heat needs. Nearly half of all fuel consumed as part of the industrial process can be converted to electricity today with technology that already exists.
States can drive electrification and efficiency investments by using flexible standards that set carbon intensity targets for industry subsectors but allow companies to identify the best path to meeting the standard. Allowing companies to trade emissions credits can also introduce additional flexibility, though it may fail to address local pollution interests. States can backstop standards with incentives or requirements for companies to electrify when making investments in new equipment.
5. Capture Methane and Fix Leaks
Methane leaks from fossil fuel infrastructure — including extraction, processing, transport, and abandoned infrastructure — and landfills should be a prime target for many states to reduce emissions of this potent greenhouse gas.
Standards in Colorado are a starting point for other states to address emissions from fossil fuel infrastructure. Regular inspection of all sites, including small sources that can add up to significant emissions, is critical for identifying and fixing leaks quickly.
More than the other four policies suggested here, this policy’s impact is extremely variable from state to state. For some it’s huge, others middling, and others quite small. Check your state’s sources in the Energy Policy Simulator for a sense of the impact.
Adding Up the Impact
We found that these five policies provide roughly two-thirds of the reductions needed to reach climate alignment by 2030 across the country, with clean electricity carrying the most weight through 2030.
Over time, transportation, buildings, and industry take on a larger share of reductions as vehicles and infrastructure, from furnaces in buildings to industrial equipment, begin to retire and get replaced at a faster pace. Because transition happens slowly in these sectors, it is critical to get the policy frameworks and investments in place now so that we can start down the path toward a cleaner, healthier, and more prosperous future.
- We used the Energy Policy Simulator (EPS) for states and the national EPS for this analysis.
- We used a model scenario aligned with the national target of reducing emissions by 50 to 52 percent in 2030 compared to 2005 (the NDC Scenario).
- We looked at the average impact of these policies across all 50 states using the national EPS and checked this average by applying those same policies to 12 states individually, including CO, IL, MD, MI, MN, NJ, NY, NV, NC, OR, VA, and WA.
- Across the 12 states evaluated, we found a range of 46 to 79 percent reductions; over half of the states were within 6 points of the national average.