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Should We Price the Carbon From Federal Coal?

Conversations in the United States about policies to reduce emissions from fossil fuels have normally focused on a number of “downstream” approaches that target the end or intermediate users of fossil fuels. Notably, the US Environmental Protection Agency’s proposed Clean Power Plan addresses emissions from existing electric power plants, and fuel economy standards are reaching […]

Coordination Challenges and a Policy Option for US and Global Climate Efforts

In recent years, US climate plans have changed abruptly. In a new RFF discussion paper, with RFF Center Fellow Anthony Paul and Research Assistant Sophie Pan, we examine the challenges for progress—specifically, of coordination among jurisdictions—that presently face policymakers in both the United States and around the world. The current centerpiece of US policy is […]

Resources Magazine: Saving Europe’s Key Weapon against Climate Change

Climate change is widely regarded as the greatest threat to the global environment. But the centerpiece of the European Union’s climate policy is being hobbled. That centerpiece is the cap-and-trade Emissions Trading System (ETS), under which companies buy and sell carbon reduction credits. The cause of the problems plaguing the European market is the presence of […]

Cap and Trade in China: How Might It Work?

China plans to start a nationwide cap-and-trade market in 2016. But can China, whose economy still contains many nonmarket features, properly design and implement a fundamentally market-based policy? In our new RFF discussion paper, my coauthors (RFF’s Richard Morgenstern, Zhongmin Wang, and Xu Liu) and I attempt to answer this question by examining cap-and-trade pilot […]

How US Gridlock May Handicap Climate Leadership

Next week, world leaders will meet at the United Nations in New York City at the invitation of UN Secretary-General Ban Ki-moon. The purpose of the meeting is to discuss actions the leaders will take to limit their country’s emissions of greenhouse gases in an effort to forestall global climate change. For many, success of […]

Tax Inversions and Carbon Taxes

Because the US has the highest corporate tax rate in the world, firms can save billions of dollars by attaining a new corporate address in a low-tax country without physically relocating any of their existing business. To do so, American firms simply need to acquire a foreign firm and reincorporate the newly formed company abroad. […]

Mixing and Matching Electricity Sector Policies

A number of concerns have emerged over the last decade about climate change, energy security, and energy efficiency, inspiring an equally long list of proposed policy fixes. The majority of these options, including renewables subsidies, performance standards, and emissions pricing schemes, apply directly to the power sector. Lawmakers can also choose to implement multiple policies […]

Recycling Revenue from a Carbon Tax

A national tax on carbon dioxide (CO2) emissions is a cost-effective and efficient tool to achieve environmentally beneficial emissions reductions that will generate billions of dollars per year in revenue for the US government. These carbon revenues can serve a range of purposes. They can pay for energy efficiency investments; they can finance cuts in […]

Solving Carbon Tax Competition Issues

Whether you’re designing a carbon tax or experimenting with a cap-and-trade policy, carbon pricing affects all participants differently. Potential inequality under a carbon tax has been a particular concern for energy-intensive, trade-exposed (EITE) sectors, whose energy-heavy processes and competitive global markets make them particularly vulnerable to carbon pricing disparities across countries. Politicians acting in the […]

Cap and Trade in California: Cost Management

California’s cap-and-trade program for greenhouse gas emissions took effect in January 2013, and as the period of enforcement unfolds, both regulated entities and the California Air Resources Board (which is responsible for the implementation and management of the program) are considering how best to manage costs within the system. Several cost containment measures are outlined […]