SAMPOL 236 - lecture 7 policy and public opinion

Overview of the main policy instruments

Regulations: Standards, rules, bans etc Environmental net gain Public procurement Natural capital accounting	Government expenditure Subsidies Feed-in tariffs and carbon contracts for difference Green banks/loans Taxonomy
Voluntary action Info/labelling/nudging Voluntary agreements	Market based instruments          Eco taxes Emissions trading scheme Carbon offsetting Carbon border adjustment mechanisms

Regulation

• Most common policy instrument

• Most associated with the traditional environmental paradigm

• Typically the gov specify standards of pollution control for products and producers

  • Enforced by state officials and legal systems

• Overall goal - for the government to influence the behaviour of businesses or citizens

• e.g. clean air acts, limits the dumping of hazardous waste and control of individuals behaviour e.g. recycling

• 3 forms

  1. Ambient standards - place limits on the total concentration of pollutants permitted in a particular area e.g. river or bathing waters

  2. Emission standards - limit what an individual source can emit e.g. gases release from factores

  3. Design standards - require the use of a specific type of pollution control tech or production process e.g. catalytic converter in car

Regulation pros and cons

• Why is it appealing?

  • Precision, predictability and effectiveness

  • all polluters treated identically

  • Administratively efficient esp when something is completely banned - don't need lots of info

  • Political, judicial and administrative back up = immune from manipulation and enhanced public legitimacy

• Criticisms

  • Mostly from right wing populists esp in USA

  • Inefficient - costly regulatory burdens for industries

  • Ineffective - implementation deficit - failure to enforce and monitor due to costs and time

    • e.g. US funding shortages limit ability to implement policy - trump trying to reduce EPA's power

    • Enviro problems still remain e.g. pollution even after many policies introduced in 1970s e.g. in US, UK, Germany

  • Underestimate of workload

    • Unrealistic deadlines or excessive administrative rules

    • Underfunding

  • A 'right to pollute' to a certain extent?

  • Depends on the country e.g. in Germany controls are mostly formal and legalistic vs UK more infromal, accomodative, technocratic without legislation - more voluntary and flexible with self-regulation - negotiating specific arrangements with polluters

    • This is quite generalised though

    • But some e.g. Vogel say that the UK's  techniques were still effective

Gov expenditure (inc pros and cons)

• Gov financial assistance or support to help achieve enviro goals when the cost for individual producers is too great - usually subsidies

• Encouragement to buy cleaner tech

• Support for insulating homes

• Reducing taxes or providing benefits

• Support for new tech

  • Feed-in-tariffs

  • Carbon contracts for difference

  • Incentives for clean tech that may be more expensive when first starting up

• Research and development funding

• Inflation reduction act - a lot of investing into clean tech but also tax credit

  • Very contested - even the name

• Cannot determine additionality e.g. would someone have insulated loft anyway? - is it changing behaviour

• Costly

• But necessary in a lot of areas - could be from private sector but gov has to take the lead

Voluntary action

• Voluntary agreements - commitment undertaken by firms or trade associations usually in consultation with public authority - usually no sanctions if not fulfilled

Voluntary action pros and cons

Pros	Cons
Flexible and cost effective Freedom for producers to decide what to implement Require little or no policing by the state May generate constructive cooperation between the state and industry	Often unambitious Often only established to avoid threat of tougher regs or eco tax e.g. swedish firms banned use of chlorine in paper bleaching to gain good publicity as a bargaining tool Risk of free riding - no sanctions to enforce compliance Varies by firm and sector

Market based instruments & eco taxes

• Solution to the alleged ineffectiveness and inefficiency - more efficient to concentrate effort on those who can reduce pollution in the cheapest way

• Polluter pays principle - aims to prevent market failure - the price of a good or service should fully reflect the total cost of production including the use of public goods e.g. air, water, land etc

  •  e.g. Pant - returnable deposit

MBIs cap and trade

How does it work?

1. Government sets overall target/cap.

2. Permits are allocated/sold/auctioned to polluters

3. Polluters can trade in permits

→ Flexibility and cost-efficient reduction in pollution

→ For those that can reduce pollution cheaply, there is an incentive to

reduce and sell permits. Those who do nothing will at least pay

something.

MBIs Carbon offsetting schemes

MBIs payment for ecosystem services

MBIs pros and cons

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