An Overview of Issues and Options for Technology Innovation and Climate Change Policy

Abstract

Climate change is a prominent global environmental challenge that is predicted to have a significant impact in the future. Addressing this issue requires substantial reductions in greenhouse gas emissions, which, in turn, necessitated major technological changes in the energy and related sectors. Those changes are crucial to achieving emissions reductions at an acceptable social cost. Fortunately, there is some consensus at the international level regarding the need for action and solutions to combat climate change. Both at the domestic and international levels, implementing policies that promote the necessary technological innovations for climate change mitigation presents institutional challenges. Developing and successfully implementing such policies requires navigating various perspectives on understanding the economics of technological innovation. To move forward and make progress in mitigating climate change, it is essential to explore viable pathways. Technological advancements offer promising solutions for combating climate change. Leveraging technology can enable countries and companies to meet their emission reduction targets effectively. Emphasizing sustainable behaviors and household actions can play a crucial role in rapidly reducing carbon emissions. Moreover, the energy transition in Europe highlights the systematic approach needed to address the challenges of decarbonization. The Intergovernmental Panel on Climate Change (IPCC) has emphasized the urgency of limiting global warming to 1.5 degrees Celsius, underscoring the need for transformative actions and innovation. A comprehensive understating of barriers, emotions, and motivational levers can inform effective pathways for lifestyle transformations and household decarbonization. While technological innovation is pivotal, it should be complemented by policy interventions that target household consumption and behavioral decisions to achieve low-carbon futures. Behavioral change, combined with technological advancements, can provide a sustainable pathway toward reducing carbon footprints and mitigating climate change The paper attempts to explain the various points of view on understanding the economics of technological innovations and a way forward on what appears to be possible for climate change mitigation.