Saturday, April 19, 2008

Appraisal of policy instruments for reducing buildings’ CO2 emissions

Dear ETP,

I want to report on an article I recently read for another class - coursework fidelity is not my strong suit. Please accept my sincerest apologies for crossing any taboo student/course relationship boundaries.

The article surveyed 60 policy evaluation reports from 30 countries in an attempt to assess which policy instruments are the most appropriate and cost-effective in reducing CO2 emissions (i.e. energy consumption) from buildings. Twenty policy instruments were addressed in the report, listed below:

Control and regulatory instruments

Economic and market-based instruments

Fiscal instruments and incentives

Support, information and voluntary action

Appliance Standards

Building codes

Mandatory labeling and certification

Procurement regulations

Energy efficiency obligations and quotas

Mandatory demand-side management

Energy performance contracting

Cooperative procurement

Energy efficiency certificate schemes

Kyoto protocol flexible mechanisms

Taxation (on CO2 or household fuels)

Tax exemption/reductions

Public benefit charges

Capital subsidies, grants, subsidized loans

Voluntary certification and labeling

Voluntary and negotiated agreements

Public leadership programs

Awareness raising, education, information campaigns

Mandatory audit and energy management requirement

Detailed billing and disclosure programs

There were originally only three categories: Regulatory, Economic, and Voluntary. Economic incentives were then divided into Fiscal and Market-based categories, the first involving actual financial transfers, the latter involving only market forces. Now, take a minute to review the 20 incentives and guess the top five most effective in reducing GHG emissions, in general and in terms of cost-effectiveness ($US/ton CO2 saved).

… (take your time)

Are you ready for the winners? Where do we energy policy mongers need to focus our energies, if you will? According to the study, appliance standards, building codes, tax exemptions/reductions, labeling, DSM programs, and energy-efficiency obligations are the breadwinners. In short, regulatory instruments were generally the most effective. Another take home point from the article: no single instrument can capture even a large share of effective and low-cost mitigation. The answer is a combination of regulatory, fiscal/market-based and informational-related instruments.

Do the conclusions make sense? I’d say so. We humans are a dim lot and it is in our best interest to have many problems taken care of for us behind the scenes. ‘Raising awareness’ does very little, but changing the things we spend our money on, whether we know it or not (appliance standards, building codes, DSM programs, product labeling), and changing the amount of money we have to spend (tax exemption/reductions) will drive us in the right direction.

Source: Ürge-Vorsatz, et al. (2007) Appraisal of policy instruments for reducing buildings’ CO2 emissions. Building Research & Information 35(4), 458-477.

To the reggae festival I go,


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