Author Cass Sunstein discusses U.S. climate change policy during the Obama administration, exploring the challenges and methods used to make changes in policy — often relying heavily on preexisting regulatory authorities.

Can supply-side environmental policies that limit the extraction of fossil fuels reduce CO2 emissions? We study interactions between a specific supply-side policy — an environmental charge on federal coal — and demand-side emissions regulation under the Clean Power Plan (CPP). Using a detailed dynamic model of the power sector, we estimate that, absent the CPP, an environmental charge equal to the social cost of carbon would generate three-quarters of the projected CPP emissions reductions. With the CPP in place, the charge reduces emissions by reducing leakage and causing the CPP to be non-binding in some scenarios.

U.S. states would implement the federal Clean Power Plan using a variety of policies that could either undermine or support the operation of electricity markets.

The authors examine the effect of real energy prices and a simulated carbon price on production and net imports. They find modest adverse competitiveness effects for energy-intensive industries.

Inadequate policy surveillance has undermined the effectiveness of multilateral climate agreements. To illustrate an alternative approach to transparency, the author evaluated policy surveillance under the 2009 G-20 fossil fuel subsidies agreement. The Leaders of the Group of 20 nations tasked their energy and finance ministers to identify and phase-out fossil fuel subsidies. The G-20 leaders agreed to submit their subsidy reform strategies to peer review and to independent expert review conducted by international organizations.

Improving end-use energy efficiency—that is, the energy-efficiency of individuals, households, and firms as they consume energy—is often cited as an important element in efforts to reduce greenhouse-gas (GHG) emissions. Arguments for improving energy efficiency usually rely on the idea that energy-efficient technologies will save end users money over time and thereby provide low-cost or no-cost options for reducing GHG emissions. However, some research suggests that energy-efficient technologies appear not to be adopted by consumers and businesses to the degree that would seem justified, even on a purely financial basis.

The authors explore relationships among emissions-reduction commitments, investment in low-carbon technology, border-carbon adjustments, and international collaboration to address climate change.

The authors evaluate the consistency of economic incentives and climate objectives in Europe, with regard to energy markets. In this context, they examine policy interactions between the EU-ETS and Europe's renewable target—and the role of natural gas in a transition to a low-carbon economy.