Reports & Papers

Decarbonizing existing buildings is a key component of greenhouse gas emission reduction strategies, but private investors have been slow to finance residential decarbonization projects because of a range of barriers. Authors Chang, Fornara, and Sanghvi argue that green banks could play a major role in unlocking public and private financing for projects that are currently financially unviable. 

Three factors are likely to have contributed to shaping Putin’s decision to launch the invasion one year ago.

NATO aspires to take the lead in understanding and adapting to the impact of climate change on security. The new Strategic Concept declares that climate change is a defining challenge of our time, with a profound impact on Allied security. Now, the Alliance and the Allies must “walk the talk” by preparing to face the emerging climate change-driven challenges and adapting their armed forces to the new climate conditions created by global warming. This paper will begin by answering the most pressing questions about NATO and climate change: Is climate change a security threat? Does climate security fit into NATO’s mission? And is NATO the best forum to address climate change? It will then review NATO’s current actions on the climate, and finally make some proposals for the Alliance to implement a climatized perspective on security to climate-proof its assets and capacities and effectively accomplish its mission and tasks.

In late 2017, Mexico made headlines as Italian company Enel bid what was then a world-record low price for renewable energy in the country’s third such energy auction. This development was possible due to the historical and sweeping energy reforms passed with broad support in Mexico in 2013. Then-President Enrique Peña Nieto had succeeded where previous Mexican presidents had failed, reversing decades of resource nationalism and overhauling the energy sector through constitutional reforms that gave the private sector a larger role and advantaged renewable energy in Mexico’s economy. The 2017 auction seemed to indicate Mexico’s bright future not only as a conventional oil producer, but also as a clean energy power.

Guangdong Province ranks first in economic output among China’s provinces and will play a major role in achieving China’s national climate-change goals. This paper examines the progress of Guangdong Province’s carbon dioxide emissions trading system (ETS) in reducing emissions; design features of the system; challenges it faces with regard to further development; and its relationship to China’s new national ETS.

In this report, we propose a market reform pathway for Yunnan that is both feasible and applicable to address some of these challenges immediately, while aiming for a standard design based on well-documented international experience. Our proposal includes at its heart a pay-for-performance monthly capacity auction that can help cover revenue deficiencies in the energy market. Building on international experience with capacity markets, this approach provides incentives for availability when generation is needed most and is compatible with the adoption of a single energy market for all electricity resources. Out-of-market payments to cover stranded costs of certain firms can thus be minimized. Finally, engaging consumers in both these energy and capacity markets can create high-powered incentives to shift consumption to low-cost months and hours, benefitting the entire province.

History is replete with irony, but rarely more poignantly than in the summer of 2016 when, on 23 June, the UK voted to leave the European Union and the next day, 24 June, the EU published its Global Strategy document asserting its ambition of “strategic autonomy.” Whither Franco-British defense cooperation in such chaotic circumstances? This paper attempts to provide the outline of an answer to that question.

This report will address four questions in the Pacific NATO debate. First, is there a historical precedent for a Pacific NATO? This report does find a precedent in the Southeast Asia Treaty Organization (SEATO), though it was largely unsuccessful due to its lack of regional adoption, weak mutual defense provisions, and ultimately became tainted by the Vietnam War.

Second, would such an alliance be necessary given the plethora of existing multilateral partnerships in the region? While there is a broad multilateral landscape in the Indo-Pacific, there is currently no agreement that combines both the wide reach and deep obligations of a hypothetical Pacific NATO. However, the Quad and RIMPAC do bring together many of the key Indo-Pacific powers and serve as an important foundation for U.S.-oriented multilateral regional security.

Third, how could such an alliance be structured? This report examines three options: expanding NATO’s mandate beyond Europe, building on its Enhanced Opportunity Partner (EOP) program, and creating a new alliance system. It also uses the case of Montenegro’s NATO accession to generate a broad set of criteria for future membership.

And fourth, how would Indo-Pacific nations, including China, respond to such an alliance? This would be exceedingly difficult. China has significant economic leverage over even our closest allies, like Australia and Japan.

Intractable internal disputes abound, particularly between South Korea and Japan and four nations—Malaysia, the Philippines, Taiwan, and Vietnam—with competing claims in the South China Sea. Two of the United States’ most important partners in the region, India and Singapore, have a longstanding aversion to exactly this type of alliance system. And for newer partners, like Malaysia and Indonesia, the value proposition is even less clear. The Chinese are likely to respond to any attempts at a multilateral military alliance in its backyard with a whole-of-government effort to stop it. If that alliance includes Taiwan, it could result in even more aggressive action.

To accelerate the global transition to a low-carbon economy, all energy systems and sectors must be actively decarbonized. While hydrogen has been a staple in the energy and chemical industries for decades, renewable hydrogen is drawing increased attention today as a versatile and sustainable energy carrier with the potential to play an important piece in the carbon-free energy puzzle. Countries around the world are piloting new projects and policies, yet adopting hydrogen at scale will require innovating along the value chains; scaling technologies while significantly reducing costs; deploying enabling infrastructure; and defining appropriate national and international policies and market structures.

What are the general principles of how renewable hydrogen may reshape the structure of global energy markets? What are the likely geopolitical consequences such changes would cause? A deeper understanding of these nascent dynamics will allow policy makers and corporate investors to better navigate the challenges and maximize the opportunities that decarbonization will bring, without falling into the inefficient behaviors of the past.

In this report, the authors conduct a benchmarking analysis for energy and CO2 emissions intensity of the steel industry among the largest steel-producing countries.