Modern Climate Policy

Climate policy has seen a tremendous evolution over the last 10 years. At the global level, the Paris Agreement has taken over from the Kyoto Protocol as the primary global climate instrument, representing a reframing of the global policy challenge away from one of solving a global commons problem towards one of providing a global framework to invest into zero carbon technologies and systems. At the national level the world has witnessed a massive diffusion of policies to stimulate investments in renewable energy and energy end-use technologies and has seen those policies bring results – not always in terms of strong emission reductions, but especially in terms of triggering the technological change that lays the foundation for full decarbonization. This includes the European feed-in tariffs that, together with Chinese energy and industry policy, brought the world cheap solar PV and wind power; these schemes have reduced emissions in the countries they were applied, but their biggest impact was to make renewable power affordable for all, putting every country in a position to decarbonize electricity. Recently, both the EU Green Deal and the US Inflation Reduction Act are oriented around stimulating investments in green technologies, responding to Chinese industry policies doing the same. Both jurisdictions, especially the US, have seen climate policy reframed away from carbon markets and towards support for particular technologies and industries, and for actively redesigning underlying systems. The new approach has its objectors. Coming from the political right – the neo-liberal side – are arguments for carbon pricing approaches prevail, and objections to the state providing support for particular technologies and industries. From the political left come arguments for de-growth, and objections to actively investing in new industries, especially those that allow current lifestyles to be perpetuated, even if they are zero-carbon. In this book, we describe, discuss and evaluate the underlying academic theories by which policies and real-world developments are understood and explained. We show the underlying reasons for disagreement, and contrast the basic premises and assumptions of each approach with empirical evidence of they have played out in reality. We show that the empirical evidence for the effectiveness of carbon pricing is modest, and even where it has reduced emissions, it has not contributed to the necessary systemic change; degrowth approaches have yet to be tested, but there is no theoretical reason to expect them to on their own eliminate emissions. Instead, the empirical evidence suggests that system-focused approaches based on positive incentives are working, both politically and for triggering emission reductions and systemic change. This matches the quickly rising academic study of socio-technical transitions that maps out how societal-wide technological shifts occur – and we show that these insights are increasingly used by climate policymakers around the world. We view the new direction in climate policy as finally putting the world on the non-linear course that could actually end greenhouse gas emissions by mid-century. Tremendous work lies ahead but, by and large, things are beginning to go well.