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Climate change is the consequence of a market failure, with private actors' incentives misaligned on a global scale and across multiple generations. Government policies to address climate change remain inadequate and the near term prospects are suspect. Analysts have turned their attention to finding alternative approaches to reducing greenhouse gas emissions. Green clubs offer a potential institutional mechanism for reducing greenhouse gas emissions, but to be effective they must be designed to fit their circumstances. An effective green club solves a market or quasi-market failure among firms and their stakeholders. Focusing on the market and nonmarket strategic imperatives for green clubs identifies several important considerations for improving the effectiveness of green clubs. Green clubs addressing climate change are more likely to be effective if they provide potential participants with a private benefit they are unable to achieve through other means and when the private benefits participants receive are tightly linked to the environmental benefits the club produces. Analyzing green clubs through this lens suggests that environmental certification club goods are more promising candidates than environmental technology club goods. [ABSTRACT FROM AUTHOR]

In this paper, we make two points about bottom-up approaches to climate policy. First, we argue that it is more productive to work with a small group of countries to establish the basis of a global climate regime than tackling the issue with all countries, as in the United Nations Framework Convention on Climate Change (UNFCCC). Secondly, we argue that negotiators should also work explicitly to encourage the development and deployment of clean technologies as a way to reduce future emissions, and suggest how this might be achieved. [ABSTRACT FROM AUTHOR]

We employ a single-country dynamically-recursive Computable General Equilibrium model to make health-focussed macroeconomic assessments of three contingent UK Greenhouse Gas (GHG) mitigation strategies, designed to achieve 2030 emission targets as suggested by the UK Committee on Climate Change. In contrast to previous assessment studies, our main focus is on health co-benefits additional to those from reduced local air pollution. We employ a conservative cost-effectiveness methodology with a zero net cost threshold. Our urban transport strategy (with cleaner vehicles and increased active travel) brings important health co-benefits and is likely to be strongly cost-effective; our food and agriculture strategy (based on abatement technologies and reduction in livestock production) brings worthwhile health co-benefits, but is unlikely to eliminate net costs unless new technological measures are included; our household energy efficiency strategy is likely to breakeven only over the long term after the investment programme has ceased (beyond our 20 year time horizon). We conclude that UK policy makers will, most likely, have to adopt elements which involve initial net societal costs in order to achieve future emission targets and longer-term benefits from GHG reduction. Cost-effectiveness of GHG strategies is likely to require technological mitigation interventions and/or demand-constraining interventions with important health co-benefits and other efficiency-enhancing policies that promote internalization of externalities. Health co-benefits can play a crucial role in bringing down net costs, but our results also suggest the need for adopting holistic assessment methodologies which give proper consideration to welfare-improving health co-benefits with potentially negative economic repercussions (such as increased longevity). [ABSTRACT FROM AUTHOR]

It is often claimed that mitigation of greenhouse gases and adaptation to climate change are complementary strategies. If this means that it will usually be optimal to use both mitigation and adaptation to deal with climate change; and that a perceived increase in the damages caused by climate change should require an increase in both mitigation and adaptation, then simple economic analysis would support such an interpretation. However, complementarity has a more technical meaning in economics, which implies if the costs of mitigation fell, then the optimal response would be to increase the level of both mitigation and adaptation. We develop a range of economic models to explore the relationship between mitigation and adaptation; and show that in general adaptation and mitigation will be substitutes. We also find that it is possible for complementarity to occur in the special case where adaptation costs depend on the amount of mitigation. [ABSTRACT FROM AUTHOR]

Using the mathematical formalism of the Brazilian Proposal to the IPCC, we analyse eight power technologies with regard to their past and potential future contributions to global warming. Taking into account detailed bottom-up technology characteristics we define the mitigation potential of each technology in terms of avoided temperature increase by comparing a 'coal-only' reference scenario and an alternative low-carbon scenario. Future mitigation potentials are mainly determined by the magnitude of installed capacity and the temporal deployment profile. A general conclusion is that early technology deployment matters, at least within a period of 50-100 years. Our results conclusively show that avoided temperature increase is a better proxy for comparing technologies with regard to their impact on climate change, and that numerous short-term comparisons based on annual or even cumulative emissions may be misleading. Thus, our results support and extend the policy relevance of the Brazilian Proposal in the sense that not only comparisons between countries, but also comparisons between technologies could be undertaken on the basis of avoided temperature increase rather than on the basis of annual emissions as is practiced today. [ABSTRACT FROM AUTHOR]

The State of California is developing and implementing a new generation of environmental policies to transition to a low-carbon economy and energy system in order to reduce the risks of future damages from global climate change. At the same time, it is increasingly clear that climate change impacts are already occurring and that further effects cannot be completely avoided. Thus, anticipating and planning for emerging and potential future climate change impacts in California must complement the state's greenhouse gas mitigation efforts. These impacts will depend substantially on the future evolution of the state's social structure and economy. To support impact studies, this report describes socioeconomic storylines and key scenario elements for California that are broadly consistent with the global 'A2' and 'B1' storylines in the 2000 Special Report on Emissions Scenarios of the Intergovernmental Panel on Climate Change, including qualitative socioeconomic context as well as quantitative projections of key variables such as population, urbanization patterns, economic growth, and electricity prices. [ABSTRACT FROM AUTHOR]

The United Nations Framework on Climate Change (UNFCCC), at its thirteenth meeting in 2005 (COP-11), agreed to start a work program to explore a range of policy approaches and positive incentives for Reducing Emissions from Deforestation and Degradation (REDD). This process was further encouraged in the 2007 COP-13 with the explicit consideration of REDD activities as a means to enhance mitigation action by developing countries in the future. This paper outlines the context of this ongoing political process by reviewing the science indicating that land-use change is a key contributor of greenhouse emissions globally and the assumptions that REDD activities may be competitive—in terms of cost effectiveness—in comparison to other mitigation options. The paper then examines REDD proposals submitted by Parties before COP-13 and identifies key economic, technological, methodological and institutional challenges associated with their implementation. These proposals are discussed in the light of major drivers of deforestation and ongoing efforts to address deforestation. This reveals another set of challenges which, if not taken into account, may undermine REDD effectiveness. The paper aims to aid the policy process and contribute to the best possible design of a REDD framework under the future climate regime. [ABSTRACT FROM AUTHOR]

Environmental policy, including the Kyoto Protocol, is laden with values. Recognizing this fact can help UNFCCC parties come to agreement. Much of the contention surrounding the post-Kyoto negotiations can be explained through a framework of values. This article summarizes the arguments used by proponents and critics of emissions trading of greenhouse gas emissions under the Kyoto Protocol through such a framework of values. Proponents and critics of emissions trading espouse common values, such as achievement, to work toward ameliorating climate change; there is less agreement on emissions trading seen through values such as responsibility and fairness. As non-Annex I parties are expected to take a more active role in the second commitment period, identifying values held by those working on their behalf will facilitate negotiations and help develop a discourse that is inclusive of their interests. Annex I parties can also benefit from the identification of the values to better convey their interests. All parties can use the values framework identified here to construct a more durable climate change regime. [ABSTRACT FROM AUTHOR]

In permit trading systems, free initial allocation is common practice. A recent example is the European Union Greenhouse Gas Emission Trading Scheme (EU-ETS). We investigate effects of different free allocation schemes on incentives and identify significant perverse effects on abatement and output employing a simple multi-period model. Firms have incentives for strategic action if allocation in one period depends on their actions in previous ones and thus can be influenced by them. These findings play a major role where trading schemes become increasingly popular as environmental or resource use policy instruments. This is of particular relevance in the EU-ETS where the current period is a trial-period before the first commitment period of the Kyoto protocol. Finally, this paper fills a gap in the literature by establishing a consistent terminology for initial allocation. [ABSTRACT FROM AUTHOR]

On the basis of the IPCC B2, A1b and B1 baseline scenarios, mitigation scenarios were developed that stabilize greenhouse gas concentrations at 650, 550 and 450 and--subject to specific assumptions--400 ppm CO2-eq. The analysis takes into account a large number of reduction options, such as reductions of non-CO2 gases, carbon plantations and measures in the energy system. The study shows stabilization as low as 450 ppm CO2-eq. to be technically feasible, even given relatively high baseline scenarios. To achieve these lower concentration levels, global emissions need to peak within the first two decades. The net present value of abatement costs for the B2 baseline scenario (a medium scenario) increases from 0.2% of cumulative GDP to 1.1% as the shift is made from 650 to 450 ppm. On the other hand, the probability of meeting a two-degree target increases from 0%--10% to 20%--70%. The mitigation scenarios lead to lower emissions of regional air pollutants but also to increased land use. The uncertainty in the cost estimates is at least in the order of 50%, with the most important uncertainties including land-use emissions, the potential for bio-energy and the contribution of energy efficiency. Furthermore, creating the right socio-economic and political conditions for mitigation is more important than any of the technical constraints. [ABSTRACT FROM AUTHOR]

This paper introduces, explains, and describes methods for addressing the issues of permanence, leakage, and additionality (PLA) of agricultural soil carbon sequestration (ASCS) activities at the project level. It is important to cast these as project-level issues, because they relate to the integrity and consistency of using location-specific ASCS projects as an offset against GHG emissions generated in other sectors (e.g., energy). The underlying objective is to understand and quantify what the net carbon benefits of an ASCS project are once we account for the fact that (1) the sequestered carbon may be stored impermanently, (2) the project may displace emissions outside the project boundaries (leakage), and (3) the project's carbon sequestration may not be entirely additional to what would have occurred anyway under business-as-usual (no project) conditions. This article evaluates methods for identifying and estimating PLA and gauges the potential magnitude of these effects on the economic returns to a project. [ABSTRACT FROM AUTHOR]

Forests of the United States and Russia can play a positive role in reducing the extent of global warming caused by greenhouse gases, especially carbon dioxide. To determine the extent of carbon sequestration, physical, ecological, economic, and social issues need to be considered, including different forest management objectives across major forest ownership groups. Private timberlands in the U.S. Pacific Northwest are relatively young, well stocked, and sequestering carbon at relatively high rates. Forests in northwestern Russia are generally less productive than those in the Northwestern U.S. but cover extensive areas. A large increase in carbon storage per hectare in live tree biomass is projected on National Forest timberlands in the U.S. Pacific Northwest for all selected scenarios, with an increase of between 157--175 Mg by 2050 and a near doubling of 1970s levels. On private timberlands in the Pacific Northwest, average carbon in live tree biomass per hectare has been declining historically but began to level off near 65 Mg in 2000; projected levels by 2050 are roughly what they were in 1970 at approximately 80 Mg. In the St. Petersburg region, average carbon stores were similar to those on private lands in the Pacific Northwest: 57 Mg per hectare in 2000 and ranging from 40 to 64 Mg by 2050. Although the projected futures reflect a broad range of policy options, larger differences in projected carbon stores result from the starting conditions determined by ownership, regional environmental conditions, and past changes in forest management. However, an important change of forest management objective, such as the end of all timber harvest on National Forests in the Pacific Northwest or complete elimination of mature timber in the St. Petersburg region, can lead to substantial change in carbon stores over the next 50 years. [ABSTRACT FROM AUTHOR]

In international climate policy discussions, one of the central issues for medium- to long run climate protection strategies is the uncertainty about the costs and the distributional effects of specific unilateral or multilateral emission reductions. This paper looks at the world-wide effects of climate protection strategies on the allocation of resources, on economic growth in different regions, and on the regional welfare effects. The analysis is based on a global recursively dynamic, multi-region, multi-sector computable general equilibrium model parameterized according to the ICLIPS (Integrated Assessment of Climate Protection Strategies) integrated assessment model. The simulations show that national climate policies will have important international repercussions. It is therefore important to consider international allocation effects in the analysis of national climate protection strategies. The welfare costs of greenhouse gas emission reductions rise more than proportionally with lower emission targets. The analysis of the carbon leakage rate indicates that most of the leakage rapidly disappears if emission reduction moves towards an efficient distribution of emission targets. [ABSTRACT FROM AUTHOR]

Deals with the desired distribution for greenhouse gas emissions of the Kyoto Protocol signed in 1998. Background of the Kyoto Protocol emissions constraints; Calculations of the costs of alternative guidelines for emissions restrictions; Advantages of the alternative guidelines.