Hoosiers will heat homes and businesses less but rely more on air conditioning as Indiana’s climate warms. They’ll also get more of their energy from natural gas and renewable sources as those become more cost-effective throughout the rest of the century.
That’s according to the latest Indiana Climate Change Impacts Assessment report, “Climate Change and Indiana’s Energy Sector,” released Tuesday (Feb. 19). The Purdue Climate Change Research Center in Purdue’s Discovery Park coordinates the IN CCIA, which includes researchers from dozens of Indiana universities and stakeholder groups.
Since research shows that the industrial and transportation sectors are less sensitive to climate change, the report focuses on residential and commercial energy use. Rising temperatures will cut Indiana’s residential energy consumption by as much as 3 percent by mid-century. But the energy needs of businesses, which rely more on cooling than heating, will increase by as much as 5.5 percent over that period, a potential cost increase of more than $100 million annually.
Extreme heat, which will become more common during Indiana summers, will reduce the capacity of power plants, transmission lines and substations, potentially causing energy disruption. Variations in precipitation could cause more spring flooding and summer drought, affecting energy supplies delivered by barges and disrupting cooling needs for power plants.
“We will have more need for dealing with warm-weather problems than cold-weather problems,” said Jeff Dukes, director of the Purdue Climate Change Research Center. “If you’re an energy company, you’ll need to be prepared for these demand shifts, especially as summer needs may stress the state’s energy infrastructure.”
Indiana currently gets about 73 percent of its energy from burning coal, 18 percent from natural gas, 5 percent from wind and the rest from other gases, hydroelectric sources, solar and biomass. That is expected to continue changing as natural gas and renewable sources become cheaper than coal and coal-fired plants reach the end of their expected life spans.
Even in extreme scenarios, with coal prices dropping to $0 and natural gas prices double what’s projected, it is expected that coal will disappear from Indiana’s energy mix. The share of renewables will grow dramatically by the end of the century, with the balance between wind and solar determined by future infrastructure costs.
“Coal is basically being priced out of the market,” said Leigh Raymond, a Purdue professor of political science and the report’s lead author. “Natural gas has already cut coal significantly based on price, and renewables have become much cheaper recently. If those trends continue, which the highest-quality predictions seem to indicate, then coal will likely disappear from the energy mix.”
The report also considers energy policies – a carbon tax and a renewable energy tax credit – that can significantly affect the speed of adoption of renewable energy sources and the decline of carbon emissions.
A $40 per ton carbon tax, levied on the carbon content of fuels and seen as a way to incentivize reduced emissions, could increase the share of electricity from renewables by 30 percent. From 2021-2080, the tax would reduce carbon dioxide emissions about 10 percent per year.
Renewable investment tax credits, which effectively lower the costs for adoption of renewable technology, achieve similar results, with renewables increasing more slowly through mid-century, but ultimately providing approximately 80 percent of Indiana’s electricity. From 2021-2080, carbon dioxide emissions would decline about 6 percent per year.
“Most economists believe a carbon tax of $100 or more is what’s necessary to effectively reduce carbon emissions, but this shows that even a modest tax would be a powerful incentive,” Raymond said. “These policies don’t solve the problem, but they have a reasonably significant effect on emissions and accelerate the shift toward renewable infrastructure.”
A video highlighting key findings of the report can be found at https://youtu.be/6bKdcaQuzWc.
The Indiana Climate Change Impacts Assessment (IN CCIA) is compiling the latest scientific research into a series of easily understandable reports about climate change impacts in 10 topic areas: climate, health, forest ecosystems, aquatic ecosystems, urban green infrastructure, tourism and recreation, agriculture, water resources, energy, and infrastructure. The assessment team consists of more than 100 experts from Purdue and other Indiana institutions.
The IN CCIA has now released eight reports. All are available on the IN CCIA website at http://indianaclimate.org/. For more information about the IN CCIA, go to the website or follow on social media at @PurdueCCRC, #ClimateChange, #INCCIA.
