Climate change is a defining threat of our generation. But the way forward has never been clearer. Electric power generation is being transformed by the rapid deployment of wind, solar and utility-scale storage. Technological innovation is reshaping transportation and industry. New means of capturing and storing carbon are on the horizon.
Even so, the challenge is monumental. To have a reasonable chance of avoiding the worst effects of climate change, the world must achieve “net-zero emissions” — taking as much carbon out of the atmosphere as we put into it — in this century. Here in the United States, we are currently emitting carbon pollution at seven times the rate that we are soaking it up. We must take advantage of every cost-effective opportunity to cut climate pollution now, while investing in the innovations that will put us on course for net-zero emissions as soon as possible.
Economic and technological trends alone won’t do the trick. Waiting to act only deepens the challenge and increases the cost and pace of reductions needed. To unleash the full potential of breakthrough clean energy technologies, we need well-designed policies that accelerate the low-carbon transition rather than hinder it.
Encouragingly, action is already underway: cities, states, and businesses are forging ahead to enact policies and undertake initiatives to reduce pollution, building on momentum from the plummeting costs of clean energy technologies. Those efforts are crucial. But the world won’t solve climate change without American leadership at all levels. To cut climate pollution at the scale and pace that science tells us is necessary requires national action.
A limit on pollution and a cost to polluters
Climate policies must lock in pollution reductions, grow the economy, and protect vulnerable populations. Policies should establish enforceable limits on climate pollution while holding polluters accountable for their share of the costs. To do all that, while providing communities everywhere with access to clean, efficient, affordable energy, we need to harness the power of markets to drive investment, create jobs, spur innovation, and deliver the transformative change needed to build the clean energy economy.
We know such policies work, because we’ve tried them before. Flexible policies that set firm, declining limits on pollution and let businesses find the best ways to respond have helped meet environmental goals faster and more cheaply than expected and while growing the economy — by penalizing pollution and rewarding new and better ways to cut emissions.
Performance-based policy and environmental integrity
The fundamental test of any climate policy is simple: Will it cut pollution at the pace and scale that the science demands?
The most straightforward way to cut carbon is to put a clear limit on pollution that guarantees the environmental outcome, while giving businesses flexibility to determine the best way to meet that limit. Ten U.S. states already have successful programs in place that take exactly this approach, known as cap and trade, and several others are moving in that direction.
Another approach, a carbon tax, also charges companies a cost for polluting. But making companies pay for their pollution doesn’t guarantee how much pollution they will cut. So for a tax to be effective, it must include an “environmental integrity mechanism” (EIM) that ties the tax to performance — and adjusts it, as necessary, to keep us on track to meet our environmental goals.
Regardless of the approach we take, the cornerstones of good policy design are the same: clear and measurable emission reduction goals, effective provisions to ensure they are met, and flexibility in how to meet them coupled with strong incentives to do it cheaply and efficiently. Given the importance of reaching net zero as soon as possible, good policy should also cast a wide net on sources and sinks of emissions — including by rewarding the innovators that pull carbon from the sky, whether by new technologies or natural sinks like forests and soils.
Environmental integrity also means preserving the ability of states and cities to take action — and, when necessary, to push further and faster than the federal government. It means protecting the Environmental Protection Agency’s statutory authority to protect the public from climate pollution and other dangerous sources of air pollution. The landmark protections established under the Clean Air Act over its more than 40-year history have saved hundreds of thousands of lives and protected the health of our children and the most vulnerable.
Here too, the key metric is environmental performance. The safeguards provided by EPA’s existing authority to limit climate pollution are particularly vital in the context of climate policies — such as a carbon tax without enforceable pollution limits — that lack provisions to ensure they will achieve their intended goals.
It’s time for America to lead again. Leadership means policies that cut pollution in line with science-based goals — backed up by provisions that guarantee the goals are met. Doing this in a way that is fair, and at lowest cost, will ensure the shared prosperity, growth, and security that are the promise of a safer climate.
Susanne Brooks is director of U.S. Climate Policy & Analysis.
Nat Keohane is senior vice president for Climate at Environmental Defense Fund.