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US carbon emissions post first annual decline since COVID

US carbon emissions post first annual decline since COVID

Built World

Early 2026 projections show output returning to 1991 levels amid an oil supply shock

Today: Report: emissions fall first time since COVID

Overview

Updated 1 hour ago

U.S. greenhouse gas emissions are projected to fall in 2026 for the first time since the COVID-19 pandemic, with output returning to roughly 1991 levels. The driver is a supply shock: a crisis in the Strait of Hormuz has disrupted global oil shipments, pushing prices up and consumption down.

The drop runs against the White House's deregulatory push. In September the EPA finalized a repeal of power-plant carbon limits that the agency itself estimates will add more than 500 million metric tons of CO2 by 2040. Whether 2026 marks a durable shift or a one-year dip depends on how long the oil shock lasts.

Why it matters

For the first time since 2020, U.S. emissions are falling — proof the fossil-fuel economy can shrink on price alone, not just policy.

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Key Indicators

6,205.3 MMT CO2 Eq.
2024 gross U.S. GHG emissions
Total gross emissions in 2024, 5.1% below 1990 and roughly flat from 2023.
+2%
2025 U.S. CO2 change from 2024
EIA data shows energy CO2 rose about 2% in 2025 as coal-fired generation jumped 13%.
1991
Projected 2026 emissions level
Early estimates put 2026 emissions back at 1991 levels, the first annual fall since the pandemic.
−0.5%
Projected 2026 global fossil-fuel change
Carbon Brief forecasts global fossil-fuel emissions fall about 0.5% in 2026 amid the Hormuz crisis.
+533 MMT
Extra CO2 from rule repeal by 2040
EPA's estimate of added carbon dioxide from repealing power-plant carbon standards.

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Timeline

January 2005 September 2026

7 events Latest: Today
Tap a bar to jump to that date
  1. Report: emissions fall first time since COVID

    Today Data

    Early projections show 2026 U.S. emissions declining year-over-year, back to 1991 levels.

  2. EPA repeals power-plant carbon rules

    Rule Change

    Agency finalized repeal of 2024 Carbon Pollution Standards, citing deregulation.

  3. 2025 emissions rise about 2%

    Data

    Coal-fired generation jumped 13%, pushing energy CO2 up roughly 2%.

  4. 2024 emissions roughly flat

    Data

    Gross emissions inched up 0.04% from 2023, ending the rebound phase.

  5. EPA issues Carbon Pollution Standards

    Rule Change

    Agency required fossil-fuel power plants to install carbon-capture controls.

  6. Pandemic cuts emissions sharply

    Data

    COVID-19 lockdowns drove the largest one-year U.S. emissions drop on record.

  7. U.S. GHG emissions peak

    Data

    Annual emissions hit an all-time high around 2005 before a long decline began.

Scenarios

1

2026 emissions decline confirmed as real

Likely Resolves by May 31, 2027

Discussed by: Carbon Brief's global fossil-fuel forecast and the September 2026 reporting behind the initial story

The September report projects 2026 U.S. emissions below 2025. The EPA's next official inventory, covering 1990 through 2026, will either confirm the decline held for the full year or show the early estimate missed.

2

Hormuz crisis fades, emissions rebound

Possible Resolves by End of 2027

Discussed by: Washington Post analysis of the oil-price demand effect; the post-2020 rebound pattern

The emissions drop hinges on a supply disruption that raises prices and cuts demand. If the Strait of Hormuz crisis resolves and oil prices fall, U.S. consumption and emissions would likely climb back in 2027, as they did after the 2020 pandemic dip.

3

Coal comeback pushes electricity emissions up

Possible Resolves by Q2 2027

Discussed by: EPA's own compliance estimate; Energy Tech's 2025 coal analysis; Energy Innovation's rollback modeling

Data-center power demand and the EPA rule repeal encourage more coal dispatch, which rose 13% in 2025. If coal generation posts another annual gain in 2026, electricity-sector CO2 could offset part of the oil-driven decline.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

October 1973 – March 1974

1973 Oil Embargo

Arab members of OPEC cut oil exports to the United States and its allies over the Yom Kippur War, quadrupling prices and forcing rationing and long gas station lines.

Then

U.S. oil consumption fell sharply as prices soared and supply shrank.

Now

Congress passed fuel-economy standards and the 55 mph speed limit, reshaping energy policy for a decade.

Why this matters now

2026's decline also flows from a supply disruption raising prices. The open question is whether it leaves lasting policy changes behind, as 1973 did.

2008–2009

Great Recession Emissions Dip

The financial crisis shrank GDP and energy use, and U.S. emissions fell for two straight years before the economy recovered.

Then

Emissions resumed growth after the recession, but stayed below the 2005 peak.

Now

Cheap natural gas from the shale boom then displaced coal, sustaining the decline through 2019.

Why this matters now

It shows a recession-driven drop can give way to a structural shift — or reverse once the shock fades.

March–April 2020

Pandemic Demand Collapse

Lockdowns across the U.S. halted travel and closed factories, cutting emissions more than 10% below 2019 and setting a modern record for the largest one-year drop.

Then

Emissions rebounded sharply in 2021–2025 as the economy reopened and fuel demand returned.

Now

The episode showed how fast demand-driven emissions cuts can happen, and how quickly they reverse when prices fall.

Why this matters now

2026 is the first annual decline since that pandemic dip; whether it sticks depends on whether demand stays low.

Sources

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