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Energy codes set efficiency standards for buildings in the majority of U.S. states. Under most energy codes, builders can comply by demonstrating that the projected private expenditures on energy bills for a proposed building are less than a certain threshold. Using theory and evidence, I show that energy codes would be improved if compliance was instead determined by the projected social damages. Relative to current practice, damage-based codes would likely provide stronger incentives for electricity than natural gas conservation, in most states. Implementation of damage-based codes would lead to substantial welfare gains. [ABSTRACT FROM AUTHOR]

A clean energy standard (CES) is a potential policy alternative to reduce carbon emissions in the electric sector. We analyze this policy under a range of technological assumptions, expanding on the Energy Modeling Forum (EMF) 24 study scenarios, using a new modeling tool, US-REGEN. We describe three innovative features of the model: treatment of spatial and temporal variability of renewable resources, cost-of-service electric sector pricing, and explicit representation of energy end-use specific capital. We find that varying technology assumptions results in vastly different futures, with large contrasts in the distribution and scale of inter-regional financial flows, and in the generation mix. We explore regional differences in how the costs of CES credits are passed through with cost-of-service vs. competitive pricing. Finally, we compare the CES to an economy-wide emissions cap. We find that although the two policies result in a similar generation mix, price and electricity end-use results differ. [ABSTRACT FROM AUTHOR]

Regulatory measures have proven the favored approach to climate change mitigation in the U.S., while market-based policies have gained little traction. Using a model that resolves the U.S. economy by region, income category, and sectorspecific technology deployment opportunities, this paper studies the magnitude and distribution of economic impacts under regulatory versus market-based approaches. We quantify heterogeneity in the national response to regulatory policies, including a fuel economy standard and a clean or renewable electricity standard, and compare these to a cap-and-trade system targeting carbon dioxide or all greenhouse gases. We find that the regulatory policies substantially exceed the cost of a cap-and-trade system at the national level. We further show that the regulatory policies yield large cost disparities across regions and income groups, which are exaggerated by the difficulty of implementing revenue recycling provisions under regulatory policy designs. [ABSTRACT FROM AUTHOR]

Although economists prefer a unique, economy-wide carbon price, climate policies are likely to continue to combine technology- and sector-specific regulations with, at best, some degree of carbon pricing. A hybrid energy-economy model that combines technological details with partial macro-economic feedbacks offers a means of estimating the likely effects of this kind of policy mix, especially under different scenarios of technological innovation. We applied such a model, called CIMS-US, in a model comparison project directed by the Energy Modeling Forum at Stanford University (EMF 24) and present here the interrelated effects of policies focused separately on electricity and transportation. We find that technological innovation encouraged by transportation regulation can inadvertently increase emissions from electricity generation and ethanol production to the extent that abatement from the regulation itself is effectively neutralized. When, however, regulation of electricity generation is combined with transportation policy or there is economy-wide carbon pricing, substantial abatement occurs. [ABSTRACT FROM AUTHOR]

The Energy Modeling Forum 24 study included a set of policy scenarios designed to compare economy wide market-based and sectoral regulatory approaches of potential U.S. climate policy. Models from seven teams participated in this part of the study assessing economy-wide cap-and-trade climate policy and sectoral policies in the transportation and electric sector in terms of potential greenhouse gas emissions reductions, economic cost, and energy systems implications. This paper presents an overview of the results from the U.S. policy scenarios, and provides insights into the comparison of results from the participating models. In particular, various metrics were used to compare the model results including allowance price, the efficient frontier, consumption loss, GDP loss, and equivalent variation. We find that the choice of economic metric is an important factor in the comparison of model results. Among the insights, we note that the carbon price should cautiously be considered when other non-cap sectoral policies affecting emissions are assumed in tandem. We also find that a transportation sector policy is consistently shown to be inefficient compared to an economy-wide capand-trade policy with a comparable level of emissions reductions. [ABSTRACT FROM AUTHOR]

Buildings are the dominant driver of daily and seasonal electric load cycles, and account for 40 percent of U.S. final energy use. They account for roughly 10 percent of direct U.S. CO2 emissions and roughly 40 percent once indirect emissions from electricity generation are included. This paper explores possible evolution of this sector over the coming century, its potential role climate action and response to climate policies, and the potential benefits advances in building technologies for addressing climate change. The paper presents a set of scenarios based on a detailed, service-based model of the buildings sector that is embedded within a long-term, global, integrated assessment model, MiniCAM. Eight scenarios are created in total, combining sets of assumptions regarding U.S. building service demand growth, two assumptions regarding the improvements in building energy technologies, two assumptions regarding long-term U.S. climate action --- a no-climate-action assumption and an assumption of market-based policies to reduce U.S. emissions consistent with a 450 ppmv global target. Through these eight scenarios, the paper comments on the implications of continued growth in building service demands, the ability of efficiency measures to reduce emissions, the strong link between decarbonization of electricity generation and building sector emissions. [ABSTRACT FROM AUTHOR]

Over the coming decades, the cost of U.S. climate change policy likely will be comparable to the total cost of all existing environmental regulation--perhaps 1-2 percent of national income. In order to avoid higher costs, policy efforts should create incentives for firms and individuals to pursue the cheapest climate change mitigation options over time, among all sectors, across national borders, and in the face of significant uncertainty. Well-designed national greenhouse gas mitigation policies can serve as the foundation for global efforts and as an example for emerging and developing countries. We present six key policy design issues that will determine the costs, cost-effectiveness, and distributional impacts of domestic climate policy: program scope, cost containment, offsets, revenues and allowance allocation, competitiveness, and R&D policy. We synthesize the literature on these design features, review the implications for the ongoing policy debate, and identify outstanding research questions that can inform policy development. [ABSTRACT FROM AUTHOR]