Working Paper

Transparency, Policy Surveillance, and the Comparison of Mitigation Efforts

Nov 7, 2016 | Joseph E. Aldy, William A. Pizer, Keigo Akimoto

Summary

Countries’ emissions mitigation pledges took many different forms under the 2015 Paris Agreement. This work highlights the role of transparency in understanding this variation and illustrates how economic tools can assess and compare mitigation efforts.

Key Findings

  • Comparing mitigation efforts can play an important role in the Paris Agreement’s transparency mechanism. By enhancing the understanding of countries’ pledges and related mitigation efforts, these analyses can facilitate greater future ambition.
  • With emissions mitigation pledges taking a variety of forms, economic tools can provide an “apples-to-apples” comparison of the emissions reductions, implicit carbon prices, and abatement costs of countries’ domestic mitigation programs.
  • We review the results of four global models that present emissions, price, and cost metrics of mitigation efforts for major developed and developing countries, and compare these to the social cost of carbon and 2°C emission pathways.
  • Countries’ mitigation programs will likely differ from the cost-effective, economy-wide carbon price assumed in most modeling analyses. We highlight key insights from the literature and place the details of countries’ mitigation programs in this context
  • We discuss how to implement future modeling analyses to better represent the real-world details of national mitigation programs. This can refine comparability metrics and provide opportunities for policy learning.

Abstract

This paper synthesizes the work in a research program focused on the transparency and comparability of mitigation efforts in multilateral climate change policy. We take as our starting point the emerging international architecture, which creates demand for practical mechanisms to compare domestic efforts to mitigate global climate change. How do countries decide whether and to what degree pledges by their peers—often expressed in different forms that stymie obvious apples-to-apples comparison—are sufficient to justify their own actions now and more ambitious actions in the future? We describe a number of desirable features of metrics that might be used for ex ante comparisons of proposed pledges and ex post assessments of subsequent actions delivering on those pledges. Such metrics should be comprehensive, measurable, and universal. In practice, however, no single metric has all these features. We suggest using a collection of metrics to characterize and compare mitigation efforts, akin to employing a suite of economic statistics to illustrate the health of the macroeconomy. We illustrate the application of a suite of metrics to several countries’ mitigation pledges using four modeling platforms. We also describe how countries increasingly employ complex suites of policies, rather than the cost-effective, economy-wide policies modelers are used to examining. This suggests new challenges and opportunities to use modeling tools to evaluate these realistic policy contexts.