Table of Contents | Foreword | Preface | Executive Summary | Overview | Contributors | Participants and Staff

A report summarizing work at RFF as part of the inter-industry U.S. Climate Policy Forum


The threat of climate change is motivating efforts around the world to curb greenhouse gas (GHG) emissions. Within the United States, emission-reduction policies are being debated at the local, state, regional, and federal levels, but the scale of the undertaking—in terms of the number of sources, magnitude of emissions, and time span involved—is unprecedented in the history of U.S. environmental regulation. Most would agree that an effective domestic climate policy must be one that elicits the investments needed to profoundly transform the country’s energy producing and using infrastructure, while at the same time doing no serious harm to the economy or unfairly burdening particular regions, industries, or households. In attempting to craft such a policy in a context where domestic efforts must ultimately be accompanied by global action, decision-makers and stakeholders are navigating largely uncharted waters.

As a participant in the domestic policy debate, Resources for the Future (RFF) has provided ideas and analysis concerning effective, least-cost strategies to limit GHG emissions for more than a decade. As Congressional momentum for action on climate policy began to build in 2004, the demand for thoughtful, objective input on critical design issues increased significantly. Moreover, as legislators became aware of the complexity of the policy challenge they asked for ever more complete and sophisticated analyses—analyses that required a thorough understanding of the impact GHG-reduction efforts would have on producers and consumers in every sector of the U.S. economy.

To meet this need, RFF organized the U.S. Climate Policy Forum in May of 2006. The Forum brings RFF researchers together with business leaders from 23 companies that represent a broad spectrum of the U.S. economy, including automobiles and heavy equipment; electricity generation; oil, gas, and coal; transport; agriculture; and chemicals, as well as large energy consumers and financial services. The Forum’s objective is to provide legislators with well-vetted, detailed policy options; important criteria for policy assessment; and well-articulated concerns (specifying the strengths and weaknesses of different approaches), from which effective federal policy might be crafted.

It was not the goal of the U.S. Climate Policy Forum to reach consensus and advocate on behalf of a specific course of action; many other organizations are filling that role. Rather, the Forum was designed to provide a process for informed dialogue on policy options and to foster a common understanding of the implications of different choices. The various issue briefs collected in this document present empirical facts, rest on a foundation of economic analysis, and attempt to be comprehensive and objective with respect to the policy issues they address. Rather than provide a single policy prescription, they aim to explain and assess a wide range of available options and to inform future policy-design decisions.

This report represents the culmination of the U.S. Climate Policy Forum process. It was written by independent RFF scholars (who retained all editorial control) and informed by a year-long dialogue with Forum participants who provided feedback and recommended areas of focus. Based on needs and priorities identified in consultations with Senate and House members and staff, former staff from relevant executive-branch agencies, corporations, and NGOs, the report is designed—first and foremost—to present information objectively and to focus on those aspects of federal policy design that are most important. In addition, the document aims to convey information in an accessible and modular fashion: accordingly, each issue brief can be read without further introduction as a standalone piece concerning a specific topic. The overview that precedes the issue briefs is intended to serve as both introduction and road map to the larger document: it provides essential context and summarizes key points from each of the issue briefs.

We believe that vigorous debate informed by independent analysis is critical to moving significant public policy efforts forward, and hope that this report serves to facilitate progress as federal climate policy discussions continue in the months and years ahead.

Raymond J. Kopp
William A. Pizer
Co-Directors, U.S. Climate Policy Forum
Senior Fellows, Resources for the Future