Climate Change Abatement Strategies Which Way is the Wind Blowing?

Abstract

The mitigation of greenhouse gas emissions, already one hot topic, got even hotter with the 16 June 2009 publication of the White House report Global Climate Change Impacts in the United States. “Choices made about emissions reductions now and over the next few decades will have far-reaching consequences for climate-change impacts,” warned the strongly worded report, which emphasized the growing sense that action must be taken soon to avoid catastrophic public health fallout from accelerating climate change—a sense echoed in a proposed ruling by the U.S. Environmental Protection Agency (EPA) seeking authority to regulate greenhouse gases as a potential public health threat. How best to drive the United States toward mitigation goals is a matter of disagreement among experts and politicians, however. The task is dauntingly complex because so many sources of greenhouse gases exist. The major sources of U.S. emissions are industry at 30%, transportation (including all forms of mass transit and shipping) at 28%, residential and commercial at 17% each, and agriculture at 8%, according to the Pew Center on Global Climate Change. There are other ways to slice the emissions pie. For instance, the electricity industry, which cross-cuts the above sectors, accounts for 30% of U.S. emissions. Past regulatory efforts aimed at reducing fossil fuel use—which were geared toward problems other than greenhouse gas emissions, such as trade deficits and traffic congestion—illustrate the need for market forces to get the job done. For instance, it was only after gas prices soared past $4 per gallon in summer 2008 that sales of high-mileage cars finally surged, while SUV sales tanked. But gas prices’ tumble back below $2 per gallon has once again dampened demand for economy cars and raised light trucks’ market share back to roughly half, underscoring the mantra of economists, which has gained adherents among the major environmental groups: when it comes to changing human behavior, prices trump rules and regulations. Thus, almost everyone who is concerned about climate change mitigation favors putting a price on greenhouse gas emissions. The question is, what strategies will yield the most mitigation bang for the investment buck?