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Are Americans really willing to shell out that much cash for zero-carbon energy? The ITIF report observes that a 2011 poll found that Americans were willing to pay just under $10 per month ($120 per year) more for electricity generated by renewable sources. In addition, half of Americans can choose to pay about 10 percent more to purchase electricity generated from renewable sources, but only 1 percent actually do so.
These calculations are just for the United States. Somewhere around 1.3 billion people around the world still do not have access to electricity. Taking the Jacobson and Delucchi figures for the world, the total cost to completely eliminate fossil fuels by 2030 would amount to $100 trillion, i.e., eight percent of global annual GDP. The global cost per household per year would amount to $3,571. The nearly three billion people who live on less than $2,000 per year simply cannot pay the prices needed to deploy current versions of renewable power technologies.
The ITIF researchers conclude, “The key to mitigating climate change is to make clean energy cheap enough to replace conventional energy without mandates, subsidies, or carbon taxes.” That’s entirely correct. But how to do that? Chiefly they advocate boosting federally-funded energy research and development from $5 billion to $15 billion per year in search of technological breakthroughs aiming to achieve dramatic cost reductions.
That overstates the efficacy federal energy R&D. But it does make a lot more sense than trying to force everybody into the equivalent of a Model T Ford.