Reducing fugitive methane emissions from the North American oil and gas sector: a proposed science-policy framework

The shale gas boom in the United States spurred a shift in electricity generation from coal to natural gas. Natural gas combined cycle units emit half of the CO₂ to produce the same energy as a coal unit; therefore, the market trend is credited for a reduction in GHG emissions from the US power sector. However, methane that escapes the natural gas supply chain may undercut these relative climate benefits. In 2016, Canada, the United States and Mexico pledged to reduce methane emissions from the oil and natural gas sector 40–45% from 2012 levels by 2025. This article reviews the science-policy landscape of methane measurement and mitigation relevant for meeting this pledge, including changes in US policy following the 2016 presidential election. Considerable policy incoherence exists in all three countries. Reliable inventories remain elusive; despite government and private sector research efforts, the magnitude of methane emissions remains in dispute. Meanwhile, mitigation efforts vary significantly. A framework that integrates science and policy would enable actors to more effectively inform, leverage and pursue advances in methane measurement and mitigation. The framework is applied to North America, but could apply to other geographic contexts.

Key policy insights

• The oil and gas sector’s contribution to atmospheric methane concentrations is becoming an increasingly prominent issue in climate policy.

• Efforts to measure and control fugitive methane emissions do not presently proceed within a coherent framework that integrates science and policy.

• In 2016, the governments of Canada, Mexico and the United States pledged to reduce methane emissions from the oil and natural gas sector 40–45% from 2012 levels by 2025.

• The 2016 presidential election in the United States has halted American progress at the federal level, suggesting a heavier reliance on industry and subnational efforts in that country.

• Collectively or individually, the countries, individual agencies, or private stakeholders could use the proposed North American Methane Reduction framework to direct research, enhance monitoring and evaluate mitigation efforts, and improve the chances that continental methane reduction targets will be achieved.

     

Health co-benefits and the development of climate change mitigation policies in the European Union

The 2015 Paris Agreement requires increasingly ambitious emissions reduction efforts from its member countries. Accounting for ancillary positive health outcomes (health co-benefits) that result from implementing climate change mitigation policies can provide Parties to the Paris Agreement with a sound rationale for introducing stronger mitigation strategies. Despite this recognition, a knowledge gap exists on the role of health co-benefits in the development of climate change mitigation policies. To address this gap, the case study presented here investigates the role of health co-benefits in the development of European Union (EU) climate change mitigation policies through analysis and consideration of semi-structured interview data, government documents, journal articles and media releases. We find that while health co-benefits are an explicit consideration in the development of EU climate change mitigation policies, their influence on final policy outcomes has been limited. Our analysis suggests that whilst health co-benefits are a key driver of air pollution mitigation policies, climate mitigation policies are primarily driven by other factors, including economic costs and energy implications.

Key policy insights

• Health co-benefits are quantified and monetized as part of the development of EU climate change mitigation policies but their influence on the final policies agreed upon is limited.

• Barriers, such as the immediate economic costs associated with climate action, inhibit the influence of health co-benefits on the development of mitigation policies.

• Health co-benefits primarily drive the development of EU air pollution mitigation policies.

• The separation of responsibility for GHG and non-GHG emissions across Directorate Generals has decoupled climate change and air pollution mitigation policies, with consequences for the integration of health co-benefits in climate policy.

     

Modelling innovation and the macroeconomics of low-carbon transitions: theory,perspectives and practical use

Energy and climate policies may have significant economy-wide impacts, which are regularly assessed based on quantitative energy-environment-economy models. These tend to vary in their conclusions on the scale and direction of the likely macroeconomic impacts of a low-carbon transition. This paper traces the characteristic discrepancies in models’ outcomes to their origins in different macro-economic theories, most importantly their treatment of technological innovation and finance. We comprehensively analyse the relevant branches of macro-innovation theory and group them into two classes: ‘Equilibrium’ and ‘Non-equilibrium’. While both approaches are rigorous and self-consistent, they frequently yield opposite conclusions for the economic impacts of low-carbon policies. We show that model outcomes are mainly determined by their representations of monetary and finance dimensions, and their interactions with investment, innovation and technological change. Improving these in all modelling approaches is crucial for strengthening the evidence base for policy making and gaining a more consistent picture of the macroeconomic impacts of achieving emissions reductions objectives. The paper contributes towards the ongoing effort of enhancing the transparency and understanding of sophisticated model mechanisms applied to energy and climate policy analysis. It helps tackle the overall ‘black box’ critique, much-cited in policy circles and elsewhere.

Key policy insights

• Quantitative models commissioned by policy-makers to assess the macroeconomic impacts of climate policy generate contradictory outcomes and interpretations.

• The source of the differences in model outcomes originates primarily from assumptions on the workings of the financial sector and the nature of money, and of how these interact with processes of low-carbon energy innovation and technological change.

• Representations of innovation and technological change are incomplete in energy-economy-environment models, leading to limitations in the assessment of the impacts of climate-related policies.

• All modelling studies should state clearly their underpinning theoretical school and their treatment of finance and innovation.

• A strong recommendation is given for modellers of energy-economy systems to improve their representations of money and finance.

     

The differentiated impact of emissions trading system based on company size

Most countries implementing an emissions trading system (ETS), such as EU member states, California in the US, or South Korea, are generally targeting large sized companies, which consume energy above a specific threshold. However, previous studies using computable general equilibrium (CGE) models have analyzed climate policies without considering company size. This may have led to inaccurate results because the impacts of climate policy would differ depending on the coverage of regulated companies. Accordingly, this study examines the environmental and economic impacts of greenhouse gas emission reduction policies, assuming policy results vary by firm size, as covered by the Korean emission trading system. To this end, a CGE model with a separate social accounting matrix based on company size is used to compare three scenarios that reflect different types of carbon pricing methods. The results show that greenhouse gases will be reduced to a lower extent and utility will decrease more if mitigation policies are only imposed to large companies.

Key policy insights

• Carbon pricing policies should consider the different impacts on companies of different sizes and industry sectors.

• Without considering the different sizes of companies covered by an ETS, the expected carbon price and its economic impact will be underestimated.

• Small and medium-sized companies will face more negative impacts than large companies in some industry sectors under an ETS, even if the mitigation burden is only faced by large companies.

     

Policy options to streamline the carbon market for agricultural nitrous oxide emissions

The majority of emissions of nitrous oxide – a potent greenhouse gas (GHG) – are from agricultural sources, particularly nitrogen fertilizer applications. A growing focus on these emission sources has led to the development in the United States of GHG offset protocols that could enable payment to farmers for reducing fertilizer use or implementing other nitrogen management strategies. Despite the development of several protocols, the current regional scope is narrow, adoption by farmers is low, and policy implementation of protocols has a significant time lag. Here we utilize existing research and policy structures to propose an ‘umbrella’ approach for nitrogen management GHG emissions protocols that has the potential to streamline the policy implementation and acceptance of such protocols. We suggest that the umbrella protocol could set forth standard definitions common across multiple protocol options, and then modules could be further developed as scientific evidence advances. Modules could be developed for specific crops, regions, and practices. We identify a policy process that could facilitate this development in concert with emerging scientific research and conclude by acknowledging potential benefits and limitations of the approach.

Key policy insights

• Agricultural greenhouse gas market options are growing, but are still underutilized

• Streamlining protocol development through an umbrella process could enable quicker development of protocols across new crops, regions, and practices

• Effective protocol development must not compromise best available science and should follow a rigorous pathway to ensure appropriate implementation

     

Mapping and clustering the adoption of carbon pricing policies: what polities price carbon and why?

Carbon pricing, including carbon taxes and emissions trading, has been adopted by different kinds of polities worldwide. Yet, beyond the increasing adoption over time, little is known about what polities – countries as well as sub- and supranational entities – adopt carbon pricing and why. This paper explores patterns of adoption (both implemented policies and those scheduled to be) through cluster analysis, with the purpose of investigating factors that could explain polities’ decisions to adopt carbon pricing. The study contributes empirically by studying carbon taxes and emissions trading together and by ordering the polities adopting carbon pricing into clusters. It also contributes theoretically, by exploring constellations of variables that drive the adoption of carbon pricing within individual clusters. We investigated 66 adopted policies of carbon pricing, which were divided into five clusters: early adopters, North-American subnational entities, Chinese pilot provinces, second-wave developed polities, and second-wave developing polities. The analysis indicates that the reasons for adopting carbon pricing have shifted over time. While international factors (climate commitments or influences from polities within the same region) are increasingly salient, domestic factors (including crises and income levels) were more important for the early adopters.

Key policy insights

• Carbon pricing has become a global mainstream policy instrument.

• Economic and fiscal crises provide windows of opportunity for promoting carbon pricing.

• The international climate regime can support the adoption of carbon pricing through mitigation commitments and international financial and technical assistance.

• Learning between polities from the same region is a useful tool for promoting carbon pricing.

• Carbon intensive economies tend to prefer emissions trading over carbon taxes.

     

Power,coalitions and institutional change in South African climate policy

This paper examines power relations, coalitions and conflicts that drive and hinder institutional change in South African climate policy. The analysis finds that the most contested climate policies are those that create distributional conflicts where powerful, non-poor actors will potentially experience real losses to their fossil fuel-based operations. This finding opposes the assumption of competing objectives between emissions and poverty reduction. Yet, actors use discourse that relates to potentially competing objectives between emissions reductions, jobs, poverty reduction and economic welfare.

The analysis relates to the broader questions on how to address public policy problems that affect the two objectives of mitigating climate change and simultaneously boosting socio-economic development. South Africa is a middle-income country that represents the challenge of accommodating simultaneous efforts for emissions and poverty reduction.

Institutional change has been constrained especially in the process towards establishing climate budgets and a carbon tax. The opposing coalitions have succeeded in delaying the implementation of these processes, as a result of unequal power relations. Institutional change in South African climate policy can be predominantly characterized as layering with elements of policy innovation. New policies build on existing regulations in all three cases of climate policy examined: the climate change response white paper, the carbon tax and the renewable energy programme. Unbalanced power relations between coalitions of support in government and civil society and opposition mainly from the affected industry result in very fragile institutional change.

Key policy insights

• The South African government has managed to drive institutional change in climate policy significantly over the past 7 years.

• Powerful coalitions of coal-related industries and their lobbies have constrained institutional change and managed to delay the implementation of carbon pricing measures.

• A successfully managed renewable energy programme has started to transform a coal- and nuclear-powered electricity sector towards integrating sustainable energy technologies. The programme is vulnerable to intergovernmental opposition and requires management at the highest political levels.

• Potential conflict with poverty reduction measures is not a major concern that actively hinders institutional change towards climate objectives. Predominantly non-poor actors frequently use poverty-related discourse to elevate their interests to issues of public concern.

     

Attitudes toward climate change mitigation policies: a review of measures and a construct of policy attitudes

Research on policy support or public acceptability of climate change policies is proliferating. There is, however, a great diversity in how these evaluative responses have been defined, operationalized, and measured across studies. In order to shed some light on this subject, we reviewed 118 studies published over the last 15 years aiming at measurement of policy acceptability, acceptance, support, and other responses to climate change mitigation policies. We found that conceptual vagueness and weak theoretical embedding are pervasive in the field, which leads to uncertainty over what is being measured, ambiguity of policy recommendations, and difficulties in comparing empirical results. In response, we propose a construct of policy attitudes as an overarching concept comprising the diversity of measures and constructs already in use. The purpose of the construct is to serve as a common basis for operationalization and survey design. In order to inform policy makers, researchers should be clear in how they formulate surveys with a focus on questions of importance to research and policy-making.

Key policy insights

• Acceptability, acceptance, and support are defined as distinct and possibly empirically distinguishable classes of responses evaluating a policy proposal. These responses are expressions of underlying policy attitudes.

• People may respond to policies in other ways as well, including lack of interest.

• There is no popularity threshold for a policy to be safe to implement, but instead it is a matter of identifying the conditions of policy support or other responses.

• Results obtained using different measures of mitigation policy attitudes vary widely with respect to the characteristics of the policy in question and the measured response. Thus, great care must be taken when designing surveys and interpreting their results.

     

Climate change mitigation strategies for agriculture: an analysis of nationally determined contributions,biennial reports and biennial update reports

The role of agriculture in the context of climate change is a complex issue. On the one hand, concerns about food security highlight the need to prioritize adaptation; on the other hand, the target of the Paris Agreement (keeping global temperature rise well below 2°C) cannot be achieved without a significant decrease in agricultural emissions. Various analyses of nationally determined contributions (NDCs) submitted under the Paris Agreement show how countries intend to prioritize the needs for adaptation and mitigation in the agricultural sector. This paper focuses on 46 countries that contribute 90% of global agricultural emissions and asks how they are addressing the agricultural sector in their climate mitigation policies. It takes into account that conditions and circumstances in countries vary significantly but might also indicate similar patterns. The analysis is based on information provided by countries in their NDCs, as well as their Biennial Reports (BRs) or Biennial Update Reports (BURs) under the UN Framework Convention on Climate Change (UNFCCC). It further includes data on national agricultural emissions. By applying a mixed methods approach, which combines qualitative content analysis and comparative cluster analysis, we find that countries vary in their progress on agriculture and climate mitigation for many different reasons. These reasons include the national perception of the problem, divergent starting points for climate policy, particularities of the agricultural sector and, correspondingly, the availability of cost-effective mitigation technologies.

Key policy insights

• While for many countries the NDCs signify the beginning of their climate policy, UNFCCC biennial reports can be used to learn more about the policies that countries have already implemented.

• Mitigation action in the agricultural sector is emphasized most prominently in cases where co-benefits are possible and production is not impacted negatively.

• Policies and measures in the agricultural sector often do not align with the UNFCCC system of monitoring, reporting and verification (MRV). In addition to improving MRV-systems, it seems equally important to exchange national experiences with implemented measures and policies.

• The Koronivia Joint Work on Agriculture could take into account the problem of different definitions of sector boundaries and thus the importance of different mitigation measures.

     

United States non-cooperation and the Paris agreement

In June 2017, the Trump administration decided to withdraw the US from the Paris Agreement, a landmark climate agreement adopted in 2015 by 195 nations. The exit of the US has not just raised concern that the US will miss its domestic emission reduction targets, but also that other parties to the Paris Agreement might backtrack on their initial pledges regarding emission reductions or financial contributions. Here we assess the magnitude of the threat that US non-cooperation poses to the Paris Agreement from an international relations perspective. We argue that US non-cooperation does not fundamentally alter US emissions, which are unlikely to rise even in the absence of new federal climate policies. Nor does it undermine nationally determined contributions under pledge and review, as the Paris Agreement has introduced a new logic of domestically driven climate policies and the cost of low-carbon technologies keeps falling. However, US non-participation in raising climate finance could raise high barriers to global climate cooperation in the future. Political strategies to mitigate these threats include direct engagement by climate leaders such as the European Union with key emerging economies, notably China and India, and domestic climate policies that furnish benefits to traditional opponents of ambitious climate policy.

Key policy insights

• US non-cooperation need not be a major threat to pledge and review under the Paris Agreement.

• US non-cooperation is a serious threat to climate finance.

• Deeper engagement with emerging economies offers new opportunities for global climate policy.

     

Targeting carbon dioxide removal in the European Union

In principle, many climate policymakers have accepted that large-scale carbon dioxide removal (CDR) is necessary to meet the Paris Agreement’s mitigation targets, but they have avoided proposing by whom CDR might be delivered. Given its role in international climate policy, the European Union (EU) might be expected to lead the way. But among EU climate policymakers so far there is little talk on CDR, let alone action. Here we assess how best to ‘target’ CDR to motivate EU policymakers exploring which CDR target strategy may work best to start dealing with CDR on a meaningful scale. A comprehensive CDR approach would focus on delivering the CDR volumes required from the EU by 2100, approximately at least 50 Gigatonnes (Gt) CO₂, according to global model simulations aiming to keep warming below 2°C. A limited CDR approach would focus on an intermediate target to deliver the CDR needed to reach ‘net zero emissions’ (i.e. the gross negative emissions needed to offset residual positive emissions that are too expensive or even impossible to mitigate). We argue that a comprehensive CDR approach may be too intimidating for EU policymakers. A limited CDR approach that only addresses the necessary steps to reach the (intermediate) target of ‘net zero emissions’ is arguably more achievable, since it is a better match to the existing policy paradigm and would allow for a pragmatic phase-in of CDR while avoiding outright resistance by environmental NGOs and the broader public.

Key policy insights

• Making CDR an integral part of EU climate policy has the potential to significantly reshape the policy landscape.

• Burden sharing considerations would probably play a major role, with comprehensive CDR prolonging the disparity and tensions between progressives and laggards.

• Introducing limited CDR in the context of ‘net zero’ pathways would retain a visible primary focus on decarbonization but acknowledge the need for a significant enhancement of removals via ‘natural’ and/or ‘engineered’ sinks.

• A decarbonization approach that intends to lead to a low level of ‘residual emissions’ (to be tackled by a pragmatic phase-in of CDR) should be the priority of EU climate policy.

     

Maladaptation and development as usual? Investigating climate change mitigation and adaptation projects in Cambodia

ABSTRACT

Based on research into multiple types of climate change mitigation and adaptation (CCMA) projects and policies in Cambodia, this paper documents intersecting social and environmental conflicts that bear striking resemblance to well-documented issues in the history of development projects. Using data from three case studies, we highlight the ways that industrial development and CCMA initiatives are intertwined in both policy and project creation, and how this confluence is creating potentials for maladaptive outcomes. Each case study involves partnerships between international institutions and the national government, each deploys CCMA as either a primary or supporting legitimation, and each failed to adhere to institutional and/or internationally recognized standards of justice. In Cambodia, mismanaged projects are typically blamed on the kleptocratic and patrimonial governance system. We show how such blame obscures the collusion of international partners, who also sidestep their own safeguards, and ignores the potential for maladaptation at the project level and the adverse social and environmental impacts of the policies themselves.

Key policy insights

• Initiatives to mitigate or adapt to climate change look very much like the development projects that caused climate change: Extreme caution must be exercised to ensure policies and projects do not exacerbate the conditions driving climate change.

• Safeguards ‘on paper’ are insufficient to avoid negative impacts and strict accountability mechanisms must be put in place.

• Academic researchers can be part of that accountability mechanism through case study reports, policy briefs, technical facilitation to help ensure community needs are met and safeguards are executed as written.

• Impacts beyond the project scale must be assessed to avoid negative consequences for social and ecological systems at the landscape level.

     

Power interplay between actors: using material and ideational resources to shape local adaptation plans of action (LAPAs) in Nepal

Deliberation over how to adapt to short or long-term impacts of climate change takes place in a complex political setting, where actors’ interests and priorities shape the temporal dimension of adaptation plans, policies and actions. As actors interact to pursue their individual or collective interests, these struggles turn into dynamic power interplay. In this article, we aim to show how power interplay shapes local adaptation plans of action (LAPAs) in Nepal to be short-term and reactive. We use an interactional framing approach through interaction analyses and observations to analyse how actors use material and ideational resources to pursue their interests. Material and ideational resources that an actor deploys include political authority, knowledge of adaptation science and national/local policy-making processes, financial resources and strong relations with international non-governmental organizations and donor agencies. We find that facilitators and local politicians have a very prominent role in meetings relating to LAPAs, resulting in short-termism of LAPAs. Findings suggest that there is also a lack of female participation contributing to short-term orientated plans. We conclude that such power interplay analysis can help to investigate how decision making on the temporal aspects of climate adaptation policy takes place at the local level.

Key policy insights

• Short-termism of LAPAs is attributed to the power interplay between actors during the policy design process.

• Improved participation of the most vulnerable, especially women, can lead to the preparation of adaptation plans and strategies focusing on both the short and long-term.

• It is pertinent to consider power interplay in the design and planning of adaptation policy in order to create a level-playing field between actors for inclusive decision-making.

• Analysis of dynamic power interplay can help in investigating climate change adaptation controversies that are marked by uncertainties and ambiguities.

     

Carbon taxes and greenhouse gas emissions trading systems: what have we learned?

Systematic evidence relating to the performance of carbon pricing – carbon taxes and greenhouse gas (GHG) emissions trading systems (ETSs) – is sparse. In 2015, 17 ETSs were operational in 55 jurisdictions while 18 jurisdictions collected a carbon tax. The papers in this special thematic section review the performance of many of these instruments over the 2005–2015 period. The performance of existing carbon taxes and GHG ETSs can help policy makers make informed choices about whether to introduce these instruments and to improve their design. The purpose of carbon pricing instruments is to reduce GHG emissions cost effectively. Assessing their performance is difficult because emissions are also affected by other policies and exogenous factors such as economic conditions. Carbon taxes in Europe prior to 2008 and in British Columbia reduced emissions from business-as-usual but actual emissions continued to rise. Since 2008 emissions subject to European carbon taxes have declined, but in most countries, other mitigation policies have probably contributed more to the reductions than the carbon taxes. Emissions subject to ETSs, with the exception of four systems without emissions caps, have declined. The ETSs contributed to the emissions reductions, but their share of the overall reduction is not known. Most tax rates are low relative to levels thought to be needed to achieve climate change objectives. Few jurisdictions regularly adjust their tax rates. All ETSs have accumulated surplus allowances and implemented measures to reduce these surpluses. The largest ETSs now specify annual reductions in their emissions cap several years into the future. Emissions trading system allowance prices are generally lower than the tax rates.

Key policy insights

• Theoretical discussions usually portray carbon taxes and GHG ETSs as alternatives. In practice, a jurisdiction often implements both instruments to address emissions by different sources.

• Designs of ETSs have evolved based on experience shared bilaterally and via dedicated institutions.

• Carbon tax designs, in contrast, have hardly evolved and there are no institutions dedicated to sharing experience.

• Every jurisdiction with an ETS and/or carbon tax also has other policies that affect its GHG emissions.

     

Electricity regulation in the Chinese national emissions trading scheme (ETS): lessons for carbon leakage and linkage with the EU ETS

Carbon leakage is central to the discussion on how to mitigate climate change. The current carbon leakage literature focuses largely on industrial production, and less attention has been given to carbon leakage from the electricity sector (the largest source of carbon emissions in China). Moreover, very few studies have examined in detail electricity regulation in the Chinese national emissions trading system (which leads, for example, to double counting) or addressed its implications for potential linkage between the EU and Chinese emissions trading systems (ETSs). This article seeks to fill this gap by analysing the problem of ‘carbon leakage’ from the electricity sector under the China ETS. Specifically, a Law & Economics approach is applied to scrutinize legal documents on electricity/carbon regulation and examine the economic incentive structures of stakeholders in the inter-/intra-regional electricity markets. Two forms of ‘electricity carbon leakage’ are identified and further supported by legal evidence and practical cases. Moreover, the article assesses the environmental and economic implications for the EU of potential linkage between the world’s two largest ETSs. In response, policy suggestions are proposed to address electricity carbon leakage, differentiating leakage according to its sources.

Key policy insights

• Electricity carbon leakage in China remains a serious issue that has yet to receive sufficient attention.

• Such leakage arises from the current electricity/carbon regulatory framework in China and jeopardizes mitigation efforts.

• With the US retreat on climate efforts, evidence suggests that EU officials are looking to China and expect an expanded carbon market to reinforce EU global climate leadership.

• Given that the Chinese ETS will be twice the size of the EU ETS, a small amount of carbon leakage in China could have significant repercussions. Electricity carbon leakage should thus be considered in any future EU–China linking negotiations.

     

Social impacts of climate change mitigation policies and their implications for inequality

The Paris Agreement and the Sustainable Development Goals (SDGs) set ambitious targets for environmental, economic and social progress. Climate change mitigation policies play a central role in this process. To maximize the benefits and minimize the negative effects of climate change mitigation policies, policymakers need to be aware of the indirect and often complex social and inequality impacts that these policies may have and the pathways through which these impacts emerge. Better understanding of the distributional and inequality impacts is important to avoid negative social and distributional outcomes as countries ratchet up their climate policy ambition in the post-Paris context. This paper synthesizes evidence from the existing literature on social co-impacts of climate change mitigation policy and their implications for inequality. The analysis shows that most policies are linked to both co-benefits and adverse side-effects, and can compound or lessen inequalities depending on contextual factors, policy design and policy implementation. The risk of negative outcomes is greater in contexts characterized by high levels of poverty, corruption and economic and social inequalities, and where limited action is taken to identify and mitigate potentially adverse side-effects.

Key policy insights

• The risk of adverse social outcomes associated with climate change mitigation policies, including worsening inequality, increases as countries ratchet up their ambition to meet the Paris Agreement targets. Many policies that have so far only been piloted will need to be up-scaled.

• Negative inequality impacts of climate policies can be mitigated (and possibly even prevented), but this requires conscious effort, careful planning and multi-stakeholder engagement. Best results can be achieved when potential inequality impacts are taken into consideration in all stages of policy making, including policy planning, development and implementation.

• Climate change mitigation policies should take a pro-poor approach that, in best case scenarios, can also lead to a reduction of existing inequalities.

     

Reducing global GHG emissions by replicating successful sector examples: the ‘good practice policies’ scenario

This article shows the potential impact on global GHG emissions in 2030, if all countries were to implement sectoral climate policies similar to successful examples already implemented elsewhere. This assessment was represented in the IMAGE and GLOBIOM/G4M models by replicating the impact of successful national policies at the sector level in all world regions. The first step was to select successful policies in nine policy areas. In the second step, the impact on the energy and land-use systems or GHG emissions was identified and translated into model parameters, assuming that it would be possible to translate the impacts of the policies to other countries. As a result, projected annual GHG emission levels would be about 50 GtCO₂e by 2030 (2% above 2010 levels), compared to the 60 GtCO₂e in the ‘current policies’ scenario. Most reductions are achieved in the electricity sector through expanding renewable energy, followed by the reduction of fluorinated gases, reducing venting and flaring in oil and gas production, and improving industry efficiency. Materializing the calculated mitigation potential might not be as straightforward given different country priorities, policy preferences and circumstances.

Key policy insights

• Considerable emissions reductions globally would be possible, if a selection of successful policies were replicated and implemented in all countries worldwide.

• This would significantly reduce, but not close, the emissions gap with a 2°C pathway.

• From the selection of successful policies evaluated in this study, those implemented in the sector ‘electricity supply’ have the highest impact on global emissions compared to the ‘current policies’ scenario.

• Replicating the impact of these policies worldwide could lead to emission and energy trends in the renewable electricity, passenger transport, industry (including fluorinated gases) and buildings sector, that are close to those in a 2°C scenario.

• Using successful policies and translating these to policy impact per sector is a more reality-based alternative to most mitigation pathways, which need to make theoretical assumptions on policy cost-effectiveness.

     

Budgeting for climate change: obstacles and opportunities at the US state level

State governments in the United States are well placed to identify opportunities for mitigation and the needs for adaptation to climate change. However, the cost of these efforts can have important implications for budgets that already face pressures from diverse areas such as unfunded pensions and growing health care costs. In this work, the current level of spending on climate-related activities at the state level are evaluated and policy recommendations are developed to improve financial management practices as they relate to climate risk. An examination of state budgets reveals that climate mitigation and adaptation activities represent less than 1% of spending in most states. The data collection highlights the obstacles to collecting accurate spending data and the lack of budgetary and accounting procedures in place. More importantly, the difficulty in benchmarking these activities poses challenges for the analysis of state-level policies as well as planning and modelling future climate-related spending. Other policy contexts, including public pensions and infrastructure, can provide guidance on budgetary and accounting tools that may help states prepare for and more efficiently manage climate-related expenditures.

Key policy insights

• Climate change mitigation and adaptation will require substantial investments across many levels of government on a wide range of activities.

• Currently, US states are not clearly demarcating climate expenditures, hindering the identification of climate-related budgetary risks.

• In the absence of guidelines, these longer term fiscal outlays may remain chronically underfunded in favour of more near-term spending priorities.

• Establishing appropriate financial management and data collection practices is important for more sophisticated cost-effectiveness and policy analyses.

     

Telling stories with models and making policy with stories: an exploration

Narrative research is in vogue in the social sciences. A current debate in philosophy of economics concerns the role of storytelling in economic modelling, and a growing research programme in policy studies investigates the influence of stories on policy outcomes. These two streams of research have yet to be connected in an investigation of how scientific models, in addition to delivering numerical results, also shape policy through the stories that are told with them. This article addresses that gap, arguing that stories produced with integrated assessment models of global climate change are particular types of policy narratives. An analytical framework for studying their composition and content is suggested. The narrative analysis of modelled stories illuminates some of the models' underpinning values and beliefs. These values and beliefs influence the normative, policy-relevant conclusions generated with the models. For illustration, the framework is applied to the analysis of two variations of the Dynamic Integrated Climate Economy model that are used to tell different stories about climate justice and climate policy.

Key policy insights

• IAMs consist of mathematical structures and the stories told by manipulating these structures.

• There is an intricate but not fully deterministic relationship between IAM structures and stories.

• Examining both these elements contributes to our understanding of the models' role in climate governance.

• Appreciation of modelled stories may facilitate more effective use of IAMs in the policy process.

     

Empirical calibration of climate policy using corporate solvency: a case study of the UK’s carbon price support

Emission reductions improve the chances that dangerous anthropogenic climate change will be averted, but could also cause some firms financial distress. Corporate failures, especially if they are unnecessary, add to the social cost of abatement. Social value can be permanently destroyed by the dissolution of organizational capital, deadweight losses paid to liquidators, and unemployment. This article proposes using measures of corporate solvency as an objective tool for policy makers to calibrate the optimal stringency of climate change policies, so that they can deliver the least loss of corporate solvency for a given level of emission reductions. They could also be used to determine the generosity of any compensation to address losses to corporate solvency. We demonstrate this approach using a case study of the UK’s Carbon Price Support (a carbon tax).

Key policy insights

• Solvency metrics could be used to empirically calibrate the optimal stringency of climate policies.

• An idealized solvency trajectory for firms affected by climate change policy would cause corporate solvency to initially decline – approaching but not exceeding ‘distressed’ levels – and then gradually improve to a new ‘steady state’ once the low-carbon transition had been achieved.

• In terms of the UK’s Carbon Price Support, corporate solvency of energy-intensive industries was found to be stable subsequent to its introduction. Therefore, the available evidence does not support its later weakening.