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Policy perspective:Building political support for carbon pricing—Lessons from cap-and-trade policies

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  • Raymond, Leigh

Abstract

How can governments build political support for carbon pricing? This question has challenged policy designers since the earliest programs imposing new prices on pollution, and remains a vital question today. This perspective offers insights on strategies for building greater political support for carbon pricing, based on previous experiences with long-running “auction and invest” programs in the U.S. and abroad, including the Regional Greenhouse Gas Initiative (RGGI), California's carbon pricing system, and the EU emissions trading system (ETS). Three key insights can be derived from those experiences. First: cap and trade with an auction of allowances is an important option for carbon pricing with distinctive advantages. Second, it is important to generate tangible public benefits from a carbon price that are distributed among citizens in a way that is broadly perceived as fair and addresses potential concerns about higher consumer costs for energy. Third, the most effective form of those public benefits should vary predictably across a few clearly defined categories according to local circumstances.

Suggested Citation

  • Raymond, Leigh, 2019. "Policy perspective:Building political support for carbon pricing—Lessons from cap-and-trade policies," Energy Policy, Elsevier, vol. 134(C).
  • Handle: RePEc:eee:enepol:v:134:y:2019:i:c:s0301421519305737
    DOI: 10.1016/j.enpol.2019.110986
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    Cited by:

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    3. Chen, Zhenling & Yuan, Xiao-Chen & Zhang, Xiaoling & Cao, Yunfei, 2020. "How will the Chinese national carbon emissions trading scheme work? The assessment of regional potential gains," Energy Policy, Elsevier, vol. 137(C).
    4. Mohamed Adib Ed-daoudi & Kenza Oubejja, 2023. "The effect of cap and trade policy on the economy, welfare and renewable energy for the Moroccan case: a partial equilibrium approach," Post-Print hal-04175968, HAL.
    5. Kayla M. Young & Kayla Gurganus & Leigh Raymond, 2022. "Framing market‐based versus regulatory climate policies: A comparative analysis," Review of Policy Research, Policy Studies Organization, vol. 39(6), pages 798-819, November.
    6. Muth, Daniel, 2023. "Pathways to stringent carbon pricing: Configurations of political economy conditions and revenue recycling strategies. A comparison of thirty national level policies," Ecological Economics, Elsevier, vol. 214(C).
    7. Weiner, Csaba & Muth, Dániel & Lakócai, Csaba, 2023. "A szén-dioxid-kibocsátást terhelő adó társadalmi elfogadottsága és a fizetési hajlandóság alakulása Magyarországon [Public acceptance of and willingness to pay for a tax on carbon-dioxide emissions," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(10), pages 1077-1107.
    8. Byrne, Conor & Oostdijk, Maartje & Agnarsson, Sveinn & Davidsdottir, Brynhildur, 2024. "The Transitional Gains Trap in Grandfathered Individual Transferable Quota Fisheries," Ecological Economics, Elsevier, vol. 215(C).

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