Preface

In February 2000, the Administration sent its fiscal year 2001 budget request to the U.S. Congress. It includes about $4 billion in programs related to climate change. The proposal includes about $1.6 billion in fiscal year 2001 for tax incentives, research and development, and other spending for the Climate Change Technology Initiative (CCTI). CCTI includes tax incentives for energy efficiency improvements and renewable technologies for buildings, light-duty vehicles, and electricity generation. Other funding covers research, development, and deployment for energy-efficient and renewable technologies, more efficient generating technologies, and carbon sequestration research.

The analysis in this report was undertaken at the request of the U.S. House of Representatives, Committee on Government Reform, Subcommittee on National Economic Growth, Natural Resources, and Regulatory Affairs. The Committee asked the Energy Information Administration (EIA) to update its report, Analysis of the Climate Change Technology Initiative, released April 14, 1999, accounting for changes in the President's fiscal year 2001 budget request, as noted in the letter in the Appendix.

The projections and quantitative analysis in this report were conducted primarily using the National Energy Modeling System (NEMS), an energy-economy model of U.S. energy markets designed, developed, and maintained by EIA, which is used each year to provide the projections in the Annual Energy Outlook. Chapter 1 of this report provides background discussion of CCTI and the methodology of the analysis. Chapters 2, 3, and 4, respectively, analyze the impacts of the tax incentives; research, development, and deployment programs; and accelerated appliance standards proposed in CCTI.