Environment & Climate Change

Harvard Project on Climate Agreements Director Robert N. Stavins delivered a presentation titled "Climate Change: Efficiency and Equity," at The Graduate Institute in Geneva, Switzerland, on November 29, 2011. The talk was one in the Geneva Environmental Dialogue Series of public keynote lectures that the Institute holds annually on a theme related to the international environment. The theme for the 2011–2012 term is "Justice and the Environment."

A "deal" is proposed in this paper, whereby all major-emitting countries, including the United States and China, agree to reduce emissions through implementation of significant, mutually agreeable, domestic emission-reduction policies. To resolve the competitiveness and equity concerns, a proposed Carbon Mitigation Fund would be created. This proposed fund is contrasted with other existing and proposed mitigation funds and finance mechanisms. 

International climate negotiations are at an impasse because the world's two largest greenhouse gas (GHG) emitters, the United States and China, are unwilling to accept binding emission-reduction commitments. At the same time, each blames the other for its inaction. This paper proposes a global "deal" for breaking the deadlock in a way that reconciles both countries' economic concerns with the imperative of reducing emissions. The deal has two core elements: (1) All major emitting countries agree to reduce GHG emissions by implementing significant, mutually agreeable, domestic policies and (2) The largest industrialized-country emitters agree to establish a global Carbon Mitigation Fund that would finance the incremental cost of adopting low-carbon technologies in developing countries.

"Because CAFE standards increase the price of new cars, the standards have the unintentional effect of keeping older — dirtier and less fuel-efficient — cars on the road longer. This is counterproductive.

Also, by decreasing the cost per mile of driving, CAFE standards — like any energy-efficiency technology standard — exhibit a rebound effect — namely, people have an incentive to drive more, not less, thereby lessening the anticipated reduction in gasoline usage."