Emissions of Carbon Dioxide in the Electric Power Sector

The accumulation of greenhouse gases in the atmosphere—particularly of carbon dioxide (CO2) released when fossil fuels are burned—contributes to climate change. Climate change imposes costs on people and countries around the globe, including the United States.

Measured in terms of its aggregate potential to affect global warming, CO2 is the most common of the greenhouse gases. Over 90 percent of CO2 emissions occur when fossil fuels—coal, natural gas, oil, and their derivative products, such as gasoline and heating oil—are burned to produce energy. About one-third of energy-related emissions, and thus about 30 percent of CO2 emissions overall, come from producing electricity. CO2 emissions in the electric power sector have been declining and are expected to continue declining in the future.

In this report, the Congressional Budget Office provides an overview of CO2 emissions and the sources of those emissions from the electric power sector. The report also examines the factors underlying recent declines in CO2 emissions in the sector and the reasons that trend is expected to continue in the years ahead.

Carbon Dioxide Emissions and Fuels Used to Produce Electric Power

The United States emitted an estimated 6.4 billion metric tons (BMT) of greenhouse gases in 2021.1 Nearly 80 percent of those emissions were carbon dioxide; the remainder, measured in CO2 equivalent units, were methane, nitrous oxide, and other (mainly fluorinated) gases.2 About 92 percent, or 4.6 BMT, of CO2 emissions occurred when fossil fuels were burned to produce energy. The other 8 percent were released as a by-product of industrial activity or product use rather than from combustion of fossil fuels. The nation’s forests and soils absorb carbon and, thus, reduce CO2 emissions; since 2010, that absorption has offset about 15 percent of CO2 emissions annually, on average.

Of the 4.6 BMT of energy-related emissions of CO2 in 2021, about one-third, or 1.5 BMT, came from the electric power sector. The transportation sector accounted for 1.7 BMT of those energy-related emissions, nearly all of which were attributable to the combustion of petroleum fuels.3 (For more information about CO2 emissions in the transportation sector, see Congressional Budget Office, Emissions of Carbon Dioxide in the Transportation Sector (December 2022), www.cbo.gov/publication/58566.) Energy-related CO2 emissions from what CBO refers to as the composite sector (industrial, residential, and commercial uses) totaled 1.4 BMT (excluding emissions from producing the electricity used in the sector, which were attributed to the electric power sector).

Unlike the transportation and composite sectors, the electric power sector has relatively low-cost options available to reduce energy-related emissions of CO2. In particular, electricity is produced using a variety of fuels containing differing amounts of carbon, and there is a high degree of substitutability among them for the sector as a whole. The other sectors are more dependent on specific fossil fuels and have fewer cost-effective alternatives available.4

Trends in Emissions of Carbon Dioxide

In the United States, energy-related emissions of CO2 from all sources and those from the electric power sector peaked around 2005. Since then, emissions of CO2 from the production of electric power have declined nearly twice as fast as total CO2 emissions, returning in 2021 to levels of the early 1980s.

Since 2005, emissions in the transportation and the composite sectors have fallen by an estimated 6 percent and 9 percent, respectively. Neither decline was as significant as the 36 percent decline in the electric power sector, which alone accounted for more than 75 percent of the estimated decline in U.S. emissions of energy-related CO2 since 2005.

That share would have been larger without the lingering effects of the coronavirus pandemic. In the transportation and composite sectors, more than half of the estimated decline in CO2 emissions since 2005 has occurred since 2019; in the electric power sector, however, less than one-tenth of that decline has occurred since then. Excluding those pandemic years, the electric power sector accounted for nearly 90 percent of the overall reduction in energy-­related CO2 emissions since 2005.

Sources of Emissions in the Electric Power Sector

Coal burned to generate electricity accounts for most of the CO2 released in the electric power sector.5 In 2021, coal-fired generation accounted for nearly 60 percent of the CO2 emissions in the sector, and the rest were almost entirely from the burning of natural gas. Emissions from burning oil and from other sources accounted for about 1 percent of emissions in the sector.

The contribution of coal was previously much higher. It accounted for more than 80 percent of CO2 emissions in the electric power sector in 2005. Emissions from coal-fired generation have since declined by almost 55 percent, or by about 1.1 BMT, although about a quarter of that decline has been offset by a near doubling of emissions from burning natural gas. Emissions from burning coal rose in 2021 as increases in natural gas prices during the postpandemic economic recovery shifted electricity production from natural gas–fired generation toward coal-fired generation.

Carbon Intensity of the Electric Power Sector

The decline in CO2 emissions in the electric power sector closely reflects the recent decrease in the carbon intensity—the amount of emissions released, on average, for each unit of electricity produced—of the sector. Since 2005, the average carbon intensity for generating electricity has fallen by about 35 percent. Put another way, producing a megawatt-hour of electricity in 2021 released about 35 percent less CO2, on average, than producing the same amount of electricity did in 2005.6

Total emissions of CO2 in the electric power sector have also declined by about 35 percent since 2005 because the amount of electricity produced has not changed much since then. Thus, the overall decline in sectoral CO2 emissions since 2005 has stemmed from changes in the composition of fuels used to produce power rather than from a reduction in electricity produced. By contrast, the average carbon intensity of the sector was largely constant before 2005, and CO2 emissions had increased because the amount of power produced had been increasing.

Factors Contributing to the Decline in Emissions in the Electric Power Sector

The decline in CO2 emissions in the electric power sector reflects two trends: a decline in the amount of fossil fuels used to produce electricity and a change in the mix of the fossil fuels used. Fossil fuels accounted for more than 70 percent of all generation in 2005; that share fell to about 60 percent by 2021. Carbon-free sources of generation accounted for the rest—nuclear, hydroelectric, and wind and solar power, among others.7 Increases in wind and solar generation have been responsible for nearly all of the growth in carbon-free generation in recent decades.

Because fossil fuels differ in the amount of carbon dioxide they release during combustion, changes in the mix of fuels used to produce power have also affected emissions in the sector. Since 2005, the share of natural gas–fired generation has more than doubled, and the share of coal-fired generation has fallen by more than half. In total, about 70 percent of the reduction in coal-fired generation was offset by an increase in natural gas–fired generation. Because burning natural gas releases about half the CO2 per megawatt-hour of electricity of combusting coal, that transition from coal-fired to natural gas–fired generation has reduced sectoral emissions even without any change in the amount of fossil fuels used overall.

Composition of Fuels Used to Generate Electric Power

Generation from coal-fired plants increased nearly unabated for decades before peaking in the mid-2000s. Those facilities generated almost 2,000 terawatt-hours of electricity in 2005, about 70 percent more than in 1980 and about five times as much as in 1960.8 But by 2021, the amount of electricity produced from coal had declined to nearly 50-year lows.

Starting in the late-1980s, coal-fired and natural gas–fired generation grew in tandem with total electricity use. When that growth leveled off starting around 2005, the increase in power produced from natural gas largely displaced that produced from coal; the amount of power produced from other sources—primarily nuclear and hydroelectric—remained largely unchanged.

In 2005, about three times as much electricity was produced from coal as from natural gas; by 2021, the amount of electricity from coal had fallen to nearly half that from natural gas. Although that transition lowered emissions, differences in the carbon intensity of those fossil fuels still meant that, in 2021, coal-fired plants collectively released about 50 percent more emissions of CO2 than natural gas–fired plants did.9

Similarly, wind and solar generation—which accounted for less than 1 percent of the electricity produced in 2005—have grown significantly. Wind power has been responsible for most of that growth, accounting for about 10 percent of the power produced in 2021; solar power accounted for about 3 percent. Despite its comparatively small share, solar power has expanded rapidly since 2015 and is expected to continue to grow. The Energy Information Administration (EIA) projects that solar generation will continue to expand and will exceed wind generation during the next decade.10

Changes in Generating Capacity

The increase in electric power generation from natural gas and renewable energy sources and the decline in coal-fired generation reflect the investments in generating capacity in recent years. Since 2005, nearly all of the capacity expansions—new construction or additions to existing power generation facilities—have been in wind, solar, and natural gas–fired generation. By contrast, about half of all capacity contractions—retirements or partial closures of facilities—have occurred in coal-fired generation, and about 30 percent have been in older, less-efficient natural gas–fired generation. Expansions and contractions of capacity for other types of generation have occurred, such as of nuclear plants and hydroelectric facilities, but have been comparatively small.

Those patterns are expected to continue. According to EIA, significant additional capacity from renewable sources and natural gas is expected to come online over the next decade, but no additional capacity is expected from coal. Capacity contractions will consist almost entirely of retirements of coal, oil, and some nuclear facilities.

Operating Costs of Existing Plants

The shift from coal to natural gas and renewable energy sources reflects changes in their relative costs to generate power. Total operating costs are the average annual costs incurred to operate a power plant, including the costs of fuel used to produce power and of routine and unexpected maintenance of equipment. Fuel costs, which are the predominant source of operating expenditures, fell by about three-fourths for natural gas between 2008 and 2020, when new mining techniques greatly increased U.S. supplies of natural gas and lowered prices. Although fuel costs for coal-fired generation have remained low, the decline in natural gas prices since 2008 has reduced the average operating costs of natural gas–fired generators below those of coal. Prices for natural gas increased in 2021, but CBO expects that the price increase will be transitory and that natural gas-fired generators will continue to have lower average operating costs than coal-fired generators. Wind and solar generators experience ongoing maintenance costs like other types of generation, but they do not incur fuel costs. The total average operating costs for renewable generation are below those for coal and natural gas.

In addition, federal policies have provided incentives that reduce the costs of renewable power. Federal tax preferences for renewable energy sources include the production tax credit (PTC) for onshore wind and the investment tax credit (ITC) for solar and offshore wind. The PTC offers a credit per kilowatt-hour of electricity produced over the first 10 years of operations, whereas the ITC offers a credit for a fixed portion of the capital cost of new generation. By the end of 2021, the PTC had expired for new generators that were not already under construction, and the ITC had decreased because of a scheduled phaseout. The 2022 reconciliation act (Public Law 117-169), signed into law on August 16, 2022, restored and extended the PTC and ITC to their full values—about $25 per megawatt-hour and 30 percent, respectively—for new construction through 2024.11 Starting in 2025, any new zero-carbon generators—energy sources such as wind and solar, as well as nuclear power, energy storage, and bioenergy with carbon capture and sequestration, among others—can take either tax credit.

Costs of Producing Electricity at New Plants

The costs of producing power from natural gas and renewable sources have fallen below that of coal. The levelized cost of electricity (LCOE) is a summary measure of the minimum price of electricity at which a technology generates enough revenue to cover the costs of constructing, financing, and operating a new power plant over an expected operating life. Since 2016, natural gas, wind, and solar have all had lower estimated LCOEs than coal.

One component of the LCOE is the estimated overnight capital cost—the average cost per unit of capacity to build a new facility, excluding the costs to finance its construction. That overnight cost has remained about the same for coal over the past decade and is roughly three times that for natural gas. The estimated overnight capital cost for wind and large solar facilities has declined significantly and is now about 65 percent below that of a coal plant.

Despite the low capital cost, renewable power has two drawbacks. First, unlike coal and natural gas, wind and solar are not dispatchable: Their output cannot be easily increased or decreased in response to changes in demand. Second, generation from those plants is intermittent: A passing cloud might create short-term intermittency for a solar plant, and longer disruptions to generation occur overnight. In the absence of large-scale energy storage, those two factors combine to reduce the availability of renewable sources to generate power during periods of unexpectedly high demand. For example, the Midcontinent Independent System Operator estimates that wind and solar resources in that region can be relied on to provide about 16 percent and 50 percent of capacity, respectively, at any given time.12 In other words, from a system-planning or reliability perspective, 600 megawatts (MW) of wind capacity or roughly 200 MW of solar capacity are considered to have the same ability to serve peak demand as 100 MW of fossil fuel capacity.

Future Carbon Dioxide Emissions in the Electric Power Sector

Largely because of anticipated growth of renewable generation, CBO expects CO2 emissions in the electric power sector to decline by about three-fifths from current levels by 2032, an amount enhanced by recent legislation that provides incentives for the use of wind and solar generation and other zero-carbon energy sources. The amount of that decline is uncertain, however, because it depends on the costs of renewable technologies in the future, the price of natural gas, the availability of transmission capacity, siting for new generators and transmission lines, and the use of financial incentives available under the 2022 reconciliation act, among other factors. Projections indicate a wide range of possibilities for CO2 emissions in the sector.

Projected Trends

Emissions in the electric power sector are projected to continue their downward trend over the coming years, and the 2022 reconciliation act is expected to accelerate those reductions. The act provides incentives for decarbonization across all sectors of the economy, but most of the projected reductions are expected to occur in the electric power sector. The key provisions affecting the sector are the extensions and expansions of the ITC and PTC to renewable and other zero-carbon generators.

Before the 2022 reconciliation act was enacted, CBO projected that energy-related emissions of CO2 would decline by nearly 25 percent, from 1.5 BMT to 1.2 BMT between 2021 and 2032, on the basis of information from the Environmental Protection Agency and projections from EIA.13 With the act’s incentives in place, CBO projects that emissions in electric power will instead decline by 62 percent, to about 0.6 BMT in 2032. Those estimates reflect projections from available studies about the effects of the reconciliation act and CBO’s assessment of uncertainties about those projections.14 The reduction is expected to result from greater investment in new wind and solar capacity and the continued operation of nuclear power plants that would otherwise have been expected to be retired.

Uncertainty About the Costs of Renewable Energy and Storage

Future emissions could be well above or below the projected trends, depending, for example, on the future cost of renewable energy generators and energy storage technologies. Although the costs of new solar and wind generators have fallen considerably—declining by 56 percent and 33 percent, respectively, in average construction costs since 2013—it is uncertain whether and how much costs to produce power from renewable sources will decline further.15 Before enactment of the 2022 reconciliation act, EIA and the National Renewable Energy Laboratory (NREL) produced base-case and sensitivity projections that assumed no further policy interventions would occur. CBO’s updated projection of CO2 emissions from the electric power sector is below EIA’s and NREL’s base-case projections, as well as their low-cost renewable projections, because the expanded tax credits are expected to significantly increase generation from solar, wind, and other zero-carbon sources.

However, developments affecting the future costs of renewable energy sources could significantly decrease or increase the projected reduction in emissions under current law. In NREL’s scenario with low-cost renewable generation before the 2022 reconciliation act, lower costs of renewable generators and energy storage would increase the share of wind and solar generation to 60 percent and substantially decrease the share of coal-fired generation to 2 percent by 2050, whereas the shares were 45 percent for wind and solar and 6 percent for coal in NREL’s midcase scenario. Differences in the projected cost of utility-scale storage are a key factor in the changes in renewable generation and emissions: The capital cost for utility-scale batteries in 2050 is about 40 percent lower and 70 percent higher in NREL’s low- and high-cost scenarios for renewable generation, respectively, than in NREL’s midcase scenario.

Additional Areas of Uncertainty

Additional factors that would affect future emissions include fuel prices, the availability of transmission capacity, the siting of transmission lines and generators, and the use of financial incentives made available by the 2022 reconciliation act, among others.

The future path of natural gas prices could have strong implications for emissions. High natural gas prices could lead to reductions in natural gas–fired generation and increased renewable generation because natural gas–fired generation would become relatively less competitive. High natural gas prices could also increase coal-fired generation, particularly because some power plants can switch fuels and generate power from either coal or natural gas. Alternatively, low natural gas prices could lead to an increased reliance on natural gas–fired power plants, further displacing coal-fired generation but also reducing investment in new renewable generation. According to EIA’s and NREL’s projections from before the passage of the 2022 reconciliation act, low natural gas prices would increase emissions by about 10 percent in 2050; high prices would decrease emissions by about 15 percent to 30 percent.

The availability of transmission capacity for electric power generators is another source of uncertainty about future emissions. Continued increases in renewable and total generation will require upgrades to the existing transmission network and construction of new transmission lines because some future renewable generation may be located in areas far from existing lines. In NREL’s scenario with high availability of transmission, long-distance transmission lines could be built to allow for more renewable generation, mostly from onshore wind. The scenario with low availability of transmission reflected a higher capital cost of transmission and a limited number of new transmission lines between regions. NREL intends the higher cost to reflect increased challenges for new transmission lines, such as additional barriers to siting or the added expense of putting some or all of a new transmission line underground. In NREL’s projection, low availability of transmission would lead to more generation from coal and natural gas, and thus more emissions, primarily at the expense of solar generation, than would occur with high availability of transmission.

Siting of facilities represents an uncertainty for both transmission and new renewable energy generators. Siting concerns, such as local opposition to the building of new transmission lines, could delay or make it more costly to interconnect new zero-carbon generators with the electric grid and deliver power to customers. In addition, siting concerns could also restrict the locations available to new solar and wind resources if those generators were forced to locate to less favorable locations. Such outcomes would probably increase future emissions relative to current projections.

Finally, uncertainty about the uptake of bonus credit provisions in the 2022 reconciliation act may further affect future emissions. Several additional credits are available in the act that can increase the value of the PTC or ITC for new zero-carbon generators. For example, entities could qualify for those bonus credits by manufacturing a generator with a specified share of domestically produced components or locating the new facility at a specific location, such as at the site of a closed coal plant. Future eligibility for those bonus credits is uncertain, but greater uptake of the bonuses would probably increase the expansion of zero-carbon generation and further reduce emissions.

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Appendix AAnalytic Method

This appendix provides information about the method that the Congressional Budget Office used to analyze trends in energy-related emissions of carbon dioxide (CO2).

The Environmental Protection Agency (EPA) provides information about the amount and sources of emissions of greenhouse gases in the United States.1 In its annual inventory, EPA catalogs emissions of carbon dioxide, methane, nitrous oxide, and other greenhouse gases. Because EPA’s 2022 inventory reports emissions through 2020, information about 2021 is not directly available. Although the Energy Information Administration (EIA) reports energy-related emissions of CO2 on a sectoral basis through 2021, the agency does not publicly report non-energy-related emissions of CO2 or emissions of other greenhouse gases. Furthermore, EIA’s estimates of annual energy-related emissions of CO2 for 2020 differ from those of EPA by about 5 percent; much of the difference is attributable to the estimates of emissions in the industrial sector.2

To describe trends in energy-related emissions of CO2 through 2021, CBO began with EPA’s estimates of emissions through 2020 for each energy-using sector of the economy—electric power, transportation, and industrial, commercial, and residential (the composite sector). Using EIA’s estimates of emissions, CBO then calculated the percentage increase or decrease in the estimate of emissions in each of those sectors from 2020 to 2021.3 To project emissions for 2021, CBO applied the percentage changes in EIA’s estimates to EPA’s estimates for 2020.

For projections of energy-related emissions of CO2 from 2022 to 2032, CBO also applied the percentage change of sectoral emissions between 2020 and each of those years in EIA’s most recent long-term projections to EPA’s 2020 estimate.4 CBO then adjusted the projections to account for the provisions in the 2022 reconciliation act, which was enacted after EIA released its projections. To estimate the effects of the law’s provisions, CBO relied on a set of studies that estimated the effects of the reconciliation act on sectoral emissions in 2030.5 Relative to their emissions projections before the reconciliation act, those studies concluded that CO2 emissions in the electric power sector would be 50 percent lower in 2030, on average. To account for various uncertainties that could result in smaller-than-projected reductions in emissions, CBO reduced that 2030 average reduction by 10 percent, so that emissions would be about 45 percent lower in 2030 with the incentives from the 2022 reconciliation act than they would be without them. CBO interpolated the percentage reductions for the years 2023 to 2029 on the basis of the 2030 estimate. For years 2031 and 2032, CBO projected that CO2 emissions would change at the same annual rates as in EIA’s most recent long-term projections for those years. Thus, the year-to-year change in emissions in CBO’s postreconciliation projections follows EIA’s projections but with the reductions estimated from the 2022 reconciliation.

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Appendix BData Sources for Figures

Energy-Related Emissions of Carbon Dioxide, by Economic Sector, 2021

Congressional Budget Office, using data from Environmental Protection Agency, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990–2020, EPA 430-R-22-003 (April 2022), https://tinyurl.com/2p8mhpe9; and Energy Information Administration, Monthly Energy Review (September 2022), www.eia.gov/totalenergy/data/monthly/previous.php.

Total Energy-Related Emissions of Carbon Dioxide From the Electric Power and Other Economic Sectors

Congressional Budget Office, using data from Environmental Protection Agency, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990–2020, EPA 430-R-22-003 (April 2022), https://tinyurl.com/2p8mhpe9; and Energy Information Administration, Monthly Energy Review (September 2022), www.eia.gov/totalenergy/data/monthly/previous.php.

Energy-Related Emissions of Carbon Dioxide and Reductions in Those Emissions, by Economic Sector

Congressional Budget Office, using data from Environmental Protection Agency, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990–2020, EPA 430-R-22-003 (April 2022), https://tinyurl.com/2p8mhpe9; and Energy Information Administration, Monthly Energy Review (September 2022), www.eia.gov/totalenergy/data/monthly/previous.php.

Emissions of Carbon Dioxide in the Electric Power Sector, by Energy Source

Energy Information Administration, Monthly Energy Review (September 2022), www.eia.gov/totalenergy/data/monthly/previous.php.

Emissions of Carbon Dioxide and the Carbon Intensity of the Electric Power Sector

Energy Information Administration, Monthly Energy Review (September 2022), www.eia.gov/totalenergy/data/monthly/previous.php.

Distribution of Electric Power Generation, by Energy Source

Energy Information Administration, Monthly Energy Review (September 2022), www.eia.gov/totalenergy/data/monthly/previous.php.

Generation of Electric Power, by Energy Source

Energy Information Administration, Monthly Energy Review (September 2022), www.eia.gov/totalenergy/data/monthly/previous.php.

Capacity Expansions and Contractions of Electric Power Generation, by Energy Source Source

Energy Information Administration, “Preliminary Monthly Electric Generator Inventory” (EIA-860M) (February 2022 and February 2017) www.eia.gov/electricity/data/eia860m.

Average Cost of Delivered Fuel, by Energy Source

Congressional Budget Office, using data from Energy Information Administration, Monthly Energy Review (September 2022), www.eia.gov/totalenergy/data/monthly/previous.php.

Estimated Annual Levelized Cost of Electricity, by Energy Source

Congressional Budget Office, using data from Energy Information Administration, Levelized Cost of New Generation Resources in the Annual Energy Outlook (various years), www.eia.gov/outlooks/archive/aeo10/electricity_generation.html (2010), www.eia.gov/outlooks/archive/aeo11/electricity_generation.php (2011), www.eia.gov/outlooks/archive/aeo12/electricity_generation.php (2012), www.eia.gov/outlooks/archive/aeo13/electricity_generation.php (2013), and www.eia.gov/outlooks/aeo/electricity_generation.php (2014–2022). Linear interpolation is used for advanced coal plants from 2016 to 2019 because of a lack of available data on the levelized costs of electricity for advanced coal plants without carbon capture and sequestration in those years.

Annual Emissions of Carbon Dioxide From the Electric Power Sector

Congressional Budget Office, using data from Environmental Protection Agency, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990–2020, EPA 430-R-22-003 (April 2022), https://tinyurl.com/2p8mhpe9; Energy Information Administration, Monthly Energy Review (September 2022), www.eia.gov/totalenergy/data/monthly/previous.php; Energy Information Administration, Annual Energy Outlook 2022 (March 2022), www.eia.gov/outlooks/aeo/; Megan Mahajan and others, Updated Inflation Reduction Act Modeling Using the Energy Policy Simulator (Energy Innovation, August 2022) https://tinyurl.com/yhcrc4n5; John Larsen and others, A Turning Point for U.S. Climate Progress: Assessing the Climate and Clean Energy Provisions in the Inflation Reduction Act (Rhodium Group, August 2022), https://tinyurl.com/2yddcr26; and Kevin Rennert, Nicholas Roy, and Dallas Burtraw, “Modeled Effects of Inflation Reduction Act of 2022” (presentation at the Resources for the Future webinar, August 10, 2022), www.rff.org/events/rff-live/inflation-reduction-act.

Projected Carbon Dioxide Emissions From the Electric Power Sector With High- and Low-Cost Renewable Generation

For NREL’s and EIA’s base-case and sensitivity projections, Congressional Budget Office, using data from Wesley Cole and others, 2021 Standard Scenarios Report: A U.S. Electricity Sector Outlook, NREL/TP-6A40-80641 (National Renewable Energy Laboratory, November 2021), www.nrel.gov/analysis/standard-scenarios.html; and Energy Information Administration, Annual Energy Outlook 2022 (March 2022), www.eia.gov/outlooks/aeo. For CBO’s projection, Congressional Budget Office, using data from Environmental Protection Agency, Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990–2020, EPA 430-R-22-003 (April 2022), https://tinyurl.com/2p8mhpe9; Energy Information Administration, Monthly Energy Review (September 2022), www.eia.gov/totalenergy/data/monthly/previous.php; Energy Information Administration, Annual Energy Outlook 2022 (March 2022), www.eia.gov/outlooks/aeo; Megan Mahajan and others, Updated Inflation Reduction Act Modeling Using the Energy Policy Simulator (Energy Innovation, August 2022) https://tinyurl.com/yhcrc4n5; John Larsen and others, A Turning Point for U.S. Climate Progress: Assessing the Climate and Clean Energy Provisions in the Inflation Reduction Act (Rhodium Group, August 2022), https://tinyurl.com/2yddcr26; and Kevin Rennert, Nicholas Roy, and Dallas Burtraw, “Modeled Effects of Inflation Reduction Act of 2022” (presentation at the Resources for the Future webinar, August 10, 2022), www.rff.org/events/rff-live/inflation-reduction-act.

About This Document

This report was prepared at the request of the Chairman of the House Committee on the Budget. In keeping with the Congressional Budget Office’s mandate to provide objective, impartial analysis, the report makes no recommendations.

David Adler and Ron Gecan prepared the report with guidance from Nicholas Chase and Joseph Kile. Kathleen Gramp, Aaron Krupkin, David Mosher, Robert Reese, and Chad Shirley offered comments.

Max Brown of the National Renewable Energy Laboratory and Laura Martin of the Energy Information Administration commented on an earlier draft. The assistance of external reviewers implies no responsibility for the final product; that responsibility rests solely with CBO.

Mark Doms, Jeffrey Kling, and Robert Sunshine reviewed the report. Rebecca Lanning edited it, and R. L. Rebach created the graphics, illustrated the cover, and prepared the text for publication. The report is available at www.cbo.gov/publication/58419.

CBO seeks feedback to make its work as useful as possible. Please send comments to communications@cbo.gov.

Phillip L. Swagel

Director

December 2022