BUILDING BLOCKS FOR A LOW-CARBON ECONOMY

The paper evaluates four scenarios—a Reference Scenario and three increasing levels of policy ambition—to determine the effectiveness of tax credits, infrastructure spending, and performance standards in decarbonizing the U.S. economy. It finds that while tax credits and spending drive early adoption, sector-specific performance standards and negative emissions technologies are essential to reach net-zero by 2050. The analysis concludes that decarbonization is economically feasible, with potential net savings of 0.3 percent of U.S. GDP by 2050 under reference oil prices.

• The United States can achieve its goal of 50–52 percent emissions reduction by 2030 and net-zero emissions by 2050 through a combination of tax credits, federal infrastructure investment, and performance standards.
• Tax credits and federal spending on climate-smart infrastructure are effective for early technology adoption but insufficient on their own to reach 2050 goals. Performance standards, such as clean electricity and zero-emissions vehicle standards, are necessary for deep decarbonization, particularly without economy-wide carbon pricing.
• Decarbonizing the U.S. economy is economically feasible. Under reference oil prices, the net cost in 2030 is $40 billion (0.2 percent of GDP) higher than the reference scenario, but by 2050, it results in a net savings of $113 billion (0.3 percent of GDP).
• In the power sector, a clean electricity standard (CES) is required to eliminate residual emissions, as tax credits alone do not provide sufficient incentive for power companies to develop carbon capture and storage (CCS) or direct air capture (DAC).
• Transportation decarbonization is hindered by the long life expectancies of internal combustion engine (ICE) vehicles, which slow the transition to electric vehicles (EVs) even as costs decline. Reaching net-zero requires 100 percent zero-emissions vehicle (ZEV) sales for light-duty vehicles by 2035 and medium- and heavy-duty vehicles by 2040.
• Building decarbonization relies on widespread electrification via heat pumps and energy efficiency. While consumer tax incentives are helpful until 2030, building performance standards that phase out fossil fuel equipment sales between 2030 and 2040 are needed to accelerate the transition.
• The industrial sector is the most difficult to decarbonize; emissions increase in scenarios relying only on tax credits and spending. An economy-wide emissions cap or low-carbon product standards are required to force the adoption of electrification and clean hydrogen.
• To reach net-zero, remaining emissions from hard-to-abate sectors must be offset by enhanced natural land sinks and negative emissions technologies (NETs), including BECCS and DAC.

APA

SAHA, D., CARLOCK, G., SHRESTHA, R., FELDMANN, J., & LESLIE-BOLE, H. (2021). BUILDING BLOCKS FOR A LOW-CARBON ECONOMY. World Resources Institute. https://files.wri.org/d8/s3fs-public/2021-12/building-blocks-low-carbon-economy.pdf?VersionId=FUmz9.KGjD5GPfem3mLB6P15hzDj9Gyj

Chicago

SAHA, DEVASHREE, GREG CARLOCK, RAJAT SHRESTHA, JOHN FELDMANN, and HALEY LESLIE-BOLE. BUILDING BLOCKS FOR A LOW-CARBON ECONOMY. World Resources Institute, 2021. https://files.wri.org/d8/s3fs-public/2021-12/building-blocks-low-carbon-economy.pdf?VersionId=FUmz9.KGjD5GPfem3mLB6P15hzDj9Gyj.

Wikipedia

{{cite report |last1=SAHA |first1=DEVASHREE |last2=CARLOCK |first2=GREG |last3=SHRESTHA |first3=RAJAT |last4=FELDMANN |first4=JOHN |last5=LESLIE-BOLE |first5=HALEY |title=BUILDING BLOCKS FOR A LOW-CARBON ECONOMY |publisher=World Resources Institute |date=December 2021 |url=https://files.wri.org/d8/s3fs-public/2021-12/building-blocks-low-carbon-economy.pdf?VersionId=FUmz9.KGjD5GPfem3mLB6P15hzDj9Gyj |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{saha2021building, author = {SAHA, DEVASHREE and CARLOCK, GREG and SHRESTHA, RAJAT and FELDMANN, JOHN and LESLIE-BOLE, HALEY}, title = {{BUILDING BLOCKS FOR A LOW-CARBON ECONOMY}}, institution = {World Resources Institute}, year = {2021}, month = dec, url = {https://files.wri.org/d8/s3fs-public/2021-12/building-blocks-low-carbon-economy.pdf?VersionId=FUmz9.KGjD5GPfem3mLB6P15hzDj9Gyj}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }