Author: Bob Grace: Founder, President and Managing Director, Sustainable Energy Advantage
Estimated reading time: 11 minutes
We kick off the Achieving Climate + Affordability series with a foundational post focused on an essential but often overlooked — or quietly unstated — question: “Compared to what?” When evaluating whether to pursue (or not pursue) a climate- or energy-related policy, procurement, investment, or other action, a clear-eyed engagement with that question is critical to making decisions that are economically viable, politically durable, and scientifically sound.
Public discussions about energy and climate increasingly frame affordability and climate objectives as being in tension — as if progress on one must necessarily come at the expense of the other. In some corners, climate action is portrayed as an unavoidable cost burden. In others, affordability concerns are dismissed as either exaggerated or beside the point. The result is a conversation in which people often talk past each other, drawing conflicting conclusions based on incompatible underlying assumptions. Press coverage often glosses over the critical “compared to what” assessment, elevating conclusions that rest on incomplete or unexamined assumptions as if they were settled.
One reason debates about climate and affordability can lose analytical clarity is that claims about cost are frequently made without clearly specifying the alternative — or are posed against unstated or selectively framed counterfactuals, or against unrealistically optimistic assumptions. Expensive compared to what? Affordable relative to which baseline? Faster or cheaper than which realistic option? What is given up when a particular choice is made, and what costs are left out of the comparison? Too often, those comparisons are implicit rather than explicit — and when that happens, the conversation quickly drifts away from analysis and toward ideology.
So, let’s unpack how this simple question can help re-anchor discussions of energy policy, climate, and affordability.
“Compared to What?” as an Analytical Discipline
Every decision – whether to depart from the status quo or to stick with it - comes with tradeoffs, and the energy-climate-affordability playing field is no exception.[1] “Compared to what?” is not a slogan or a rhetorical trick; it is an analytical discipline. Every claim about cost, savings, affordability, or economic impact rests on an implied counterfactual — an alternative pathway, policy design, technology mix, or timing assumption. When that counterfactual is left unstated, it becomes impossible to evaluate whether the claim is meaningful or misleading, complete or incomplete. Often underappreciated is the fact that deciding not to take an action is itself a decision, with its own implications. It is easy to criticize any proposal if the critic does not have to acknowledge the implications of the alternatives.
In energy and climate debates, the missing or hidden counterfactual often matters more than the headline conclusion. The question is whether the assumptions against which a choice is being evaluated are transparent, apples-to-apples, and anchored in current, real-world conditions. Are we comparing near-term costs to long-term benefits? One policy design to another, or to inaction? Real options against hypothetical/theoretical or unproven alternatives? A technology that is commercially available today, to solve a current problem, to one that may not be deployable at scale for decades? Without clarity on those questions, cost comparisons can sound precise while being fundamentally ambiguous.
Importantly, this is not a partisan or ideological failure. It shows up across the spectrum — in advocacy, in policy analysis, in investment commentary, and sometimes even in formal benefit-cost analyses. The problem is not disagreement about values; the problem is, at best, insufficient discipline about assumptions, and at worst, a willingness to let those assumptions go unexamined in service of a preferred conclusion.
When Climate Action Really Does Increase Costs — and Why That Matters
A constructive conversation also requires acknowledging an uncomfortable truth: many actions intended to address climate objectives involve real costs, especially in the near term. Infrastructure investment, technology development, system integration, and risk management all require capital. Pretending otherwise may feel reassuring, but it ultimately undermines credibility.
Importantly, “cost” itself is not a single concept. Serious benefit-cost analysis recognizes this by examining impacts from multiple perspectives — including participants, ratepayers, taxpayers, and society more broadly — rather than collapsing all effects into a single headline figure.
Dismissing these costs outright is not only analytically sloppy; it is politically counterproductive. When affordability impacts emerge after the fact — whether through rates, taxes, or reliability concerns — stakeholders feel misled. That erosion of trust can quickly translate into backlash, reversals, or policy fatigue.
At the same time, acknowledging the costs of climate-oriented actions is only half of the comparison. Alternative choices — including delaying action or relying more heavily on existing resource mixes — also carry costs, even if they are less visible, deferred, or distributed differently. A “Compared to what?” discipline requires that those alternatives be evaluated with the same rigor as the actions being proposed.
Acknowledging costs does not mean conceding defeat or abandoning ambition. It means being honest about tradeoffs — on all sides of the comparison — and thoughtful about how, when, and by whom costs are borne. In practice, that honesty is often a prerequisite for policies and investments that endure.
The Hidden Assumptions Behind Many “Compared to What?” Claims
Where the “Compared to what?” discipline becomes most important is in examining the assumptions that sit quietly beneath many affordability claims. In recent years, a growing share of the debate has hinged not just on what different pathways cost, but on how those costs are calculated — and what is left out of the comparison.
1. Feasibility and Timing Are Often Treated as Optional
One common analytical shortcut is to compare options as if they are equally available on the same timeline. In reality, the pace at which different resources can be deployed varies widely, and the availability, flexibility, ability to interconnect, or cost of identified or implied alternatives may not be considered on a level playing field. Long lead times, supply-chain constraints, permitting processes, and equipment availability backlogs all affect what can actually be built — and when.
Comparisons that ignore timing implicitly assume that delayed deployment or availability has no cost or consequence. That assumption is rarely neutral. Delays can introduce reliability risks, price volatility, and the need for stop-gap solutions that are themselves expensive or inefficient.
2. Infrastructure Is Often Assumed, Not Accounted For
Another frequent omission involves enabling infrastructure. Cost comparisons may assume the availability of fuel supply, transmission, pipelines, or waste management solutions without accounting for them at all, or without clearly identifying who will develop them, who will pay for them, or whether they are politically and socially viable.
When no actor is clearly responsible for delivering that infrastructure — or when public acceptance is uncertain — treating the availability of the counterfactual as a given is not an objective assumption. It is a speculative one. Ignoring those uncertainties can make some pathways appear more affordable on paper than they are likely to be in practice. This pattern shows up across a wide range of analyses and viewpoints.
3. Uncertainty Is Sometimes Replaced with Optimism
Affordability claims also tend to rely on point estimates for technologies or pathways that carry significant uncertainty. Modeled costs, projected learning curves, and assumed deployment at scale are often treated as settled outcomes rather than contingent possibilities.
Recognizing uncertainty is not a criticism. It is an acknowledgement that technology advances, cost, siting, financing, and acceptance challenges evolve over time — and that treating uncertain outcomes as certainties can skew comparisons in misleading ways.
4. Stale or Unrealistic Counterfactuals Shape Procurement Decisions
Finally, “Compared to what?” problems often show up in procurement and benefit-cost analyses that rely on outdated assumptions about alternative resources, system needs, or market conditions. A project can look expensive or uneconomic depending entirely on what it is compared to — even if that counterfactual is built on generic or obsolete assumptions, or assumptions that carry large and unacknowledged uncertainties.
These analytical shortcuts matter because they influence real decisions: which projects move forward, which stall, and which narratives gain traction. Over time, they shape investment signals and public confidence — for better or worse.
Design Matters: Outcomes Are Not Inevitable
One of the most important implications of all this is that outcomes are not predetermined. High costs are not an unavoidable consequence of pursuing climate objectives, just as low costs are not guaranteed by maintaining the status quo or stepping away from climate action. Policy design, market structure, procurement mechanisms, and risk allocation all matter — often more than the headline choice of technology.
When affordability challenges emerge, they are often the result of specific design choices rather than inherent features of climate action. Surfacing assumptions, testing counterfactuals, and being explicit about constraints creates space to improve those designs — and, in many cases, to achieve better outcomes on both climate and cost.
What “Compared to What?” Changes in Practice
Asking “Compared to what?” does not dictate answers. Rather, it advances the conversation in a more informed way. It forces clarity about assumptions, highlights timing and feasibility constraints, and makes tradeoffs explicit rather than implicit. It also can create common ground among stakeholders who may disagree on priorities but share an interest in making better decisions.
In practice, this lens helps shift debates from slogans to substance — from absolutes to alternatives. It encourages questions like: What problem are we actually trying to solve? What options are realistically available on the relevant timeline? What risks are being shifted, deferred, or ignored? Those are the kinds of questions that lead to better policy, better investment decisions, and more durable outcomes.
Conclusion: Compared to What, and Why It Matters
Stepping back, the point of asking “Compared to what?” is not to win an argument about any single technology, policy, or pathway. It is to improve the quality of the conversation — and, ultimately, the quality of the decisions that flow from it. Claims about affordability or cost that rest on unstated, selective, or unrealistic counterfactuals may be rhetorically effective, but they are analytically weak. Over time, they undermine trust, distort investment signals, and contribute to policy whiplash rather than durable progress — costs that tend to surface later, when assumptions meet real-world constraints.
This series starts from a simple premise: advancing climate objectives and managing affordability are not mutually exclusive goals, but neither can be addressed honestly without acknowledging real tradeoffs, constraints, and uncertainties. Better outcomes depend on being explicit about assumptions, clear about timing and feasibility, and disciplined about what we are comparing against. That discipline does not dictate a single answer — but it does lead to better questions and analysis, more constructive dialogue, and decisions that are more likely to hold up in the real world.
Future posts in Achieving Climate + Affordability will take this lens and apply it to specific contexts — examining procurement decisions based on unrealistic or stale counterfactuals, and exploring what increased reliance on different generation pathways would actually entail when issues of timing, cost, siting, and public acceptance are considered head-on. The goal is not advocacy or prediction, but to help move the conversation toward solutions that are economically viable, politically durable, and scientifically sound.
If this perspective resonates, subscribe to SEA-Scape to follow future posts in the Achieving Climate + Affordability series — and to continue the conversation about how clearer thinking can lead to better decisions.
[1] Grace, R. C., Donovan, D. A., & Melnick, L. L. (2011). When Renewable Energy Policy Objectives Conflict: A Guide for Policymakers. National Regulatory Research Institute, Report No. 11-17.