Fiddling while carbon burns: Why climate policy needs pervasive emission pricing as well as technology promotion

Pezzey, John C. V., Jotzo, Frank and Quiggin, John (2008) Fiddling while carbon burns: Why climate policy needs pervasive emission pricing as well as technology promotion. The Australian Journal of Agricultural and Resource Economics, 52 1: 97-110. doi:10.1111/j.1467-8489.2008.00403.x

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Author Pezzey, John C. V.
Jotzo, Frank
Quiggin, John
Title Fiddling while carbon burns: Why climate policy needs pervasive emission pricing as well as technology promotion
Journal name The Australian Journal of Agricultural and Resource Economics   Check publisher's open access policy
ISSN 1364-985X
1467-8489
Publication date 2008-03-01
Year available 2008
Sub-type Article (original research)
DOI 10.1111/j.1467-8489.2008.00403.x
Open Access Status Not yet assessed
Volume 52
Issue 1
Start page 97
End page 110
Total pages 14
Place of publication Carlton, Vic., Australia
Publisher Wiley-Blackwell Publishing Asia
Language eng
Subject C1
9607 Environmental Policy, Legislation and Standards
9603 Climate and Climate Change
160507 Environment Policy
919901 Carbon and Emissions Trading
140205 Environment and Resource Economics
Abstract Effective climate policy requires global emissions of greenhouse gases to be cut substantially, which can be achieved by energy supply technologies with lower emissions, greater energy use efficiency and substitution in demand. For policy to be efficient requires at least fairly uniform, fairly pervasive emission pricing from taxes, permit trading or combinations of the two; and significant government support for low-emission technologies. We compare the technology-focused climate policies adopted by Australia and the 'Asia-Pacific Partnership on Clean Development and Climate' (AP6), against this policy yardstick. We find that such policies omit the need for emission pricing to achieve abatement effectively and efficiently; they over-prescribe which abatement actions should be used most; they make unrealistic assumptions about how much progress can be achieved by voluntarism and cooperation, in the absence of either adequate funding or mandatory policies; and they unjustifiably contrast technology-focused policy and the Kyoto Protocol approach as the only two policies worth considering, and thus ignore important policy combinations.
Formatted abstract
Effective climate policy requires global emissions of greenhouse gases to be cut substantially, which can be achieved by energy supply technologies with lower emissions, greater energy use efficiency and substitution in demand. For policy to be efficient requires at least fairly uniform, fairly pervasive emission pricing from taxes, permit trading or combinations of the two; and significant government support for low-emission technologies. We compare the technology-focused climate policies adopted by Australia and the ‘Asia–Pacific Partnership on Clean Development and Climate’ (AP6), against this policy yardstick. We find that such policies omit the need for emission pricing to achieve abatement effectively and efficiently; they overprescribe which abatement actions should be used most; they make unrealistic assumptions about how much progress can be achieved by voluntarism and cooperation, in the absence of either adequate funding or mandatory policies; and they injustifiably contrast technology-focused policy and the Kyoto Protocol approach as the only two policies worth considering, and thus ignore important policy combinations.
Keyword Asia-Pacific Partnerhsip
Climate policy
Pricing
Technology
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status UQ

 
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Created: Thu, 16 Apr 2009, 18:33:12 EST by Elmari Louise Whyte on behalf of Faculty of Business, Economics & Law