The recent unveiling of the first comprehensive global evaluation of 1,500 climate policy measures from 41 countries by an international research team has shed light on the effectiveness of various climate policy instruments. Published in the prestigious journal Science, this groundbreaking study analyzed the impact of climate policies implemented over the last two decades. While the findings provide valuable insights, they also reveal a stark reality – many policy measures have fallen short of achieving the necessary scale of emissions reductions.
One of the key takeaways from the study is the critical role of tax and price incentives in successful climate policies. Only 63 cases of effective climate policies were identified, each leading to an average emission reduction of 19%. These successful cases underscore the importance of well-designed policy mixes that incorporate a combination of complementary instruments. The debate on climate policy effectiveness often revolves around the question of which instruments work best in reducing emissions. However, prior evaluations have focused primarily on headline policies, overlooking a multitude of other measures.
Led by researchers from the Potsdam Institute for Climate Impact Research (PIK) and the Mercator Research Institute on Global Commons and Climate Change (MCC), in collaboration with experts from leading institutions, this study aims to fill this gap by providing a comprehensive evaluation of a diverse range of climate policy measures. The research team utilized a new OECD database, the most extensive inventory of climate policies to date, to conduct a detailed impact analysis of the 1,500 policy interventions implemented between 1998 and 2022.
The study highlights the significance of the right mix of policy measures in achieving substantial emission reductions. For example, subsidies or regulations alone are insufficient, and only when combined with price-based instruments such as carbon and energy taxes, can they deliver significant results. Specific examples from the study illustrate this point, demonstrating that bans on coal-fired power plants or combustion engine cars are not effective on their own. Successful cases, such as those in the UK and Norway, show that tax or price incentives play a crucial role in achieving emissions reductions.
The study provides specific examples of successful climate policies in different sectors and countries. For instance, China’s pilot emissions trading systems in the industrial sector, the UK’s minimum carbon price in the electricity sector, the US’s tax incentives and subsidies in the transportation sector, and Germany’s eco-tax reform in the transport sector. These case studies highlight the diverse range of policy measures that have proven effective in reducing emissions and offer valuable insights for policymakers and stakeholders.
The global evaluation of climate policy measures conducted by an international research team offers important lessons for the effective design and implementation of climate policies. By emphasizing the importance of well-designed policy mixes that incorporate a combination of instruments, the study provides a roadmap for achieving substantial emissions reductions. Moving forward, policymakers and stakeholders can use these insights to guide the transition to climate neutrality and address the urgent challenges posed by climate change.
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