Prof. Robert Stavins has contributed greatly to the evolution of environmental policy. He's pioneered new instruments for achieving environmental progress and improved the effectiveness of traditional tools. This paper is no exception. Here, Dr. Stavins offers compelling counsel on how best to structure a cap-and-trade policy to achieve reductions in greenhouse gas pollution.
Just as when comprehensive climate change legislation reached the floor of the U.S. Senate in the fall of 2008, the U.S. House of Representative's passage of the Waxman-Markey climate change bill (officially H.R. 2454, the American Clean Energy and Security Act) gave hope to supporters of comprehensive federal legislation.
For the Barack Obama Administration, addressing climate change has quickly risen as a priority. How the Administration should address climate change, however, remains very much in question. The U.S. Congress has started to move on climate legislation, but assuming passage, the final shape and detail of these efforts may not be known for months or even years. In the meantime, the Clean Air Act (CAA)1--a complex legal framework with many regulatory hooks and levers--remains the law of the land.
Our public debate about policy to combat climate change sometimes seems limited to a choice between trading and taxes. Yet, there are other tools of governance that could be more actively examined. The problem of global warming is so big that we should be actively pursuing a "full-toolbox" approach of doing everything we can, and considering how each strategy can be synergistically implemented in concert with other strategies.
Editors' Summary
Among the complex aspects of the recently passed Waxman-Markey climate change legislation (H.R. 2454) is its formula for distributing emission allowances. Beyond the sectoral allocation of free allowances for the first few years of the cap-and-trade system's operation, what else does the bill entail for allowance allocation?
Editors' Summary
Climate change legislation and rulemaking will present fertile ground for judicial inquiry. Specifically, the courts can expect to field challenges to the scope of EPA authority to regulate greenhouse gas emissions under the Clean Air Act, the scope of state authority to regulate greenhouse gas emissions, and citizen access to the courts to seek damages, challenge projects, or enforce climate regulations. Ideally, Congress will decide many of these issues in forthcoming legislation, but one can expect many more to fall to the federal courts to resolve.
Editors' Summary
In the coming months, U.S. companies that sell their shares on public stock exchanges will be filing annual reports with the Securities and Exchange Commission (SEC). In part, those SEC filings aim to allow investors to see the company's prospects from management's perspective. In their filings, management describes developments it sees on the horizon that have the potential to affect their companies' operations--and profits.