Dr. Lee Anne Willson
The Low-Carbon Scenario
This week the consultants, SSG, presented some of the elements of their plan for Ames that will be shared next week with the City Council. A recording of the session with the Supplemental Input Committee is online at https://ames.granicus.com/player/clip/1487?view_id=1&redirect=true (and can be found via the Ames Climate Action Plan page on the city website).
In the presentation, SSG emphasized that this is the result of modeling what Ames needs to do to meet, or get close to, the goal that the Council voted for in December. Once the city accepts the “what,” SSG will prepare the final portion of the Climate Action Plan, the “how” – what rule changes, incentives etc. can the city use to achieve the “what.”
Here I will share some highlights from this report, and try to put them into a broader perspective.
What is included – Six Big Moves and the resulting reduction in emissions
SSG earlier released documentation for “six big moves” of Ames – the six areas responsible for most of the carbon emissions, and what can be done about those. The six big areas are building retrofits, net-zero new construction, renewable energy generation, reducing vehicle emissions, increasing active transportation and transit, and reducing waste emissions. These formed the basis for a second survey of Ames residents, and for discussion in six focus groups assembled by the city. The focus groups represented business, training and labor; youth and students; construction and development; non-profit and equity seeking groups; transportation; and residents and resident-led groups. I was a participant in that last-named focus group.
Results of the survey showed generally strong support for the actions that are proposed, assuming modest help from the city (such as information about what is appropriate to do and who is reliable to do it, and with partial or substantial subsidies for those in lower income brackets).
Two key diagrams sum up the proposed actions. The first is the “what will happen graph”, immediately below. This shows, under the CAP, what emissions would change and in what areas they would change.
Notice that the 2030 emissions would still be above the 83% target reduction, and the emissions in 2050 would not be at zero. Some SIC members were dismayed by this, but I am impressed that SSG managed to get us this close, since their modeling reflects only known and currently available technology. I’ve assumed from the start that to make these goals Ames will need to take advantage of changes that are coming but not yet here – technology advances, cost reductions as new technologies reach large-scale production, new finance models, and regulation changes that affect the financial picture. To my eye, these results justify keeping the goals that were set in December 2021. The City of Ames can accept the “what will happen” from this report, and proceed to the “how will we make it happen.” I assume, following Ames’ responsible history of city management, that Ames’ progress towards the goals will be reviewed and revised as time goes along, as more information and more options are found.
Those who have been worried about the December goals being too ambitious are likely to look ahead to the “how” and assume that the measures needed will be too expensive or too uncomfortable to achieve, or both. When the “how” comes out, we can see to what extent their concerns are justified, or whether (as I believe) most of the “how” will have lower net costs and bigger benefits than they expect.
What are the pieces of the “what?”
The second key diagram, immediately below, shows the individual sector changes that take us from business as usual to the proposed net-zero trajectory.
[Note: The first graph shows 1.25 million tonnes of CO2 per year emitted for 2018; this one shows 1250 kilotonnes per year. The numbers look different, but they are the same.]
This is a “wedge plot” of the elements that were included in the sectors in the first diagram. The 32 multi-colored actions shown in the chart represent most of the things that Ames can do with encouragement or regulation by the city. The four biggest steps needed to achieve the goal are: adding ground mount solar; replacing our waste-to-energy facility; taking advantage of decarbonization in our electric grid, MISO; and developing more rooftop solar installations.
What this leaves out: (a) carbon sequestration – trees, prairie areas, and biochar for three examples; and (b) smaller actions that the city can’t push but individual citizens can, including some elements of waste reduction, privately purchasing offsets, and reducing unnecessary travel. It’s not clear now how we can count the contribution of these individual actions, but that is a different problem, and one I expect can be solved. I see these diagrams as showing that our goals are possible, though not easy to reach.
The economics of the proposal
In the table below, the net investments and returns are broken down here into five categories, with the overall result shown in green. The large capital expenditure (blue) is offset for Ames by operation and maintenance savings (teal) and energy cost savings (yellow). While the initial investment (spread out over a decade or more) is daunting, in the long run what matters is the net investment- the green bar. On a per-year basis from 2023-2050 that amounts to about $30 million per year. For perspective, the total city budget is about 250 million/year. Of the net city income, about $35 (14%) million is in the form of property taxes. The CAP will require an investment of roughly 10% of the city budget spread out over the next three decades. However, most of this will not be paid for by the city, but in a complicated mix of private investment, federal and/or state incentives, with a much smaller amount from the city to make it happen. Also, a lot of the money that s spent will stay in Ames, as wages and profits for local businesses, generating some new tax revenues.
SSG told the SIC that for 90% of the cities they work with (most of those in Canada), going for carbon neutrality eventually pays off in savings. This is not true for Ames, and the two primary reason(s) are interesting. One piece missing for Ames is “avoided carbon taxes,” because there is not a carbon tax that applies to Ames. SSG commented that the carbon tax usually flips the balance from net cost to net gain. Such is the power of a carbon tax, and if the U.S. decides to adopt one, it could flip this diagram to net income. If not, we should recognize that we have saved already by not paying for the carbon emissions we put into the atmosphere, a moral debt. At $20-$80 per ton (typical carbon tax numbers), Ames’ current emissions would be costing us about $25-100 million per year. We should look at the budget numbers and make our decisions based on an appropriate estimate for the “social cost” (cost of damage / cost of later removal) for those emissions. The lower estimate for carbon tax would seliminate the net cost from this graph, and the higher estimate would lead to savings exceeding the cost by a substantial amount.
The second missing piece is “renewable energy revenue.” As a municipality, Ames is not eligible for most rebates or incentives issued by state or federal governments. For this reason, and similarly for ISU, it is more effective to work with an independent entity that is eligible for those rebates, and then recover the benefits of those rebates in the form of cheaper electrical power.
Another way to look at this
Suppose that someone you care for, perhaps a grandchild, has been diagnosed with a serious illness. The doctors tell you that there is a treatment, and probably a cure, but it will be expensive and at times uncomfortable. I would not greet such news with “Sorry, we won’t accept that treatment?” Or “We will wait until something easier comes along, and if the patient dies in the meantime, that’s too bad.” The climate crisis is a threat to the health and happiness of our children and grandchildren, and even though the treatment may cost us some money and some inconvenience, I am ready to invest in a better quality of life for those who follow us.