Study: Colorado’s green policies carry a massive economic toll By EPN Staff Policies designed to combat climate change in Colorado have sandbagged the state’s economy by costing billions of dollars and resulting in the loss of tens of thousands of jobs, according to a recent study by a nonpartisan economic policy think tank. Those findings have highlighted the extreme financial toll of state policies to address a problem that doesn’t respect state or national boundaries. The Common Sense Institute’s report evaluated price, production, tax and consumption changes in Colorado since 2009 and found the state’s environmental and emissions policies have adversely affected several economic sectors, including employment, energy prices, industry, transportation and buildings. The costs include: $13.8 billion in lost personal income $32 billion in lost economic output $6.5 billion in lost energy production While the state achieved a reduction in carbon emissions, researchers noted the exorbitant cost compared to other states’ efforts. “Even under the most generous attribution of carbon abatement to Colorado policy, its price per ton of carbon emissions is still higher than other policies throughout the United States that pursue the same ends,” the report concludes. “Under a more realistic approach that credits some emissions reduction to developments other than state and local policy, it is possible that carbon abatement through the policies enacted in Colorado has been upwards of 10 times more expensive.” Why it matters Colorado has been one of the nation’s top states for oil and gas production, even as it ranks among the top five states for environmental and climate-related policy. In 2021, Gov. Jared Polis and the legislature set a deadline for the state to reach 100% net-zero greenhouse gas emissions by 2050. The oil and gas and industrial manufacturing industries have exceeded their reduction goals by 25% and 44%, respectively. Still, Colorado lawmakers in March 2025 began drafting legislation that would shorten that goal to 2040, despite the hardship on businesses. In the 2025 session, the legislature also considered building decarbonization, climate emissions disclosures by businesses, and warning signs on gas pumps, among a slew of other regulations already on the books. But policy comes with a price. For example, energy providers, labor unions and business groups asked lawmakers to reconsider the new emissions goal because of the speed and cost it would take to “build out the framework,” and would drive energy prices higher in a state that struggles with affordability. And an earlier report from the Common Sense Institute calculated policy-driven carbon-reduction efforts will carry $108 billion in new costs to consumers through 2050 in Colorado. The bigger picture Forty-five states have adopted climate action plans in exchange for federal grant funding opportunities. Five states opted out: Florida, Iowa, Kentucky, South Dakota and Wyoming. Yet within those five states, major cities have their own climate action plans. Uncertainty is growing amid new federal policy actions. With the Trump Administration focused on environmental policy rollbacks, some states are taking aim at climate-related laws and legislation. Texas may require energy providers to maintain 50% of dispatchable sources, which do not include renewable energy. South Dakota and Minnesota have clashed over clean energy goals and retiring coal plants; Minnesota has a net-zero emissions goal of 2040, while its neighbor, South Dakota, has a Public Utility Commission concerned with energy reliability. What others are saying Environmental advocates claim the CSI report is based on “bad math.” The Colorado Energy Office said the report was at odds with rigorous economic analyses required by the state. And the state legislative and regulatory affairs director of the Environmental Defense Fund said the report lacked evidence. An attorney at the Western Resource Advocates said that spikes in utility bills, as claimed by the report, were not the “result of sensible climate policies.”
