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The American Power Act (APA) would require facilities emitting over 25,000 tons of CO2 equivalent to hold emission permits, though energy-intensive, trade-exposed manufacturing subsectors would be eligible for free allowance rebates. WRI analysis indicates that eligible subsectors would receive enough free permits to cover all emissions for 2016 and several years following. Based on EIA projections across low, medium, and high permit price scenarios, most examined chemicals subsectors would experience only modest energy and compliance effects in the first year of compliance (2016).

Following a 2007 Supreme Court ruling and a 2009 EPA finding that greenhouse gases (GHGs) endanger public health and welfare, the EPA is positioned to regulate GHGs under the Clean Air Act. Potential regulatory paths include emission performance standards for motor vehicles and performance or technology standards for stationary sources like power plants and factories. While such regulations may increase production costs for some manufacturers, they could lower consumer costs through improved fuel and electricity efficiency. The document notes that EPA action could overlap or conflict with future congressional legislation unless statutory authority is clearly defined.

The document defines a carbon tax as a fee on fossil fuels and primary products based on greenhouse gas emissions, providing a financial incentive for reduction. It distinguishes carbon taxes from cap-and-trade programs by noting that taxes set a price without an emissions limit, whereas cap-and-trade sets a limit with a market-determined price. The text details how these taxes are typically applied upstream and passed to downstream consumers, noting that the economic impact on businesses and lower-income individuals depends on whether revenues are 'recycled' through rebates or tax cuts to maintain revenue neutrality. It mentions international implementations in Europe, Japan, and British Columbia, and notes the political difficulty of establishing a national carbon tax in the United States.

The policy brief examines the challenges of integrating carbon offsets into a U.S. cap-and-trade system, specifically highlighting the difficulties in quantifying and verifying soil and forest carbon sequestration. It argues that while offsets provide flexibility and cost-containment for capped entities, the high transaction costs and uncertainties associated with certain project types may make them less efficient than alternative regulations or incentive programs. The authors recommend a holistic strategy that evaluates the acceptable level of risk for overstating emission reductions and considers offsets as one part of a broader suite of climate policies.

The document defines cap-and-trade as a market-based system that sets a maximum limit on greenhouse gas emissions, creating a carbon price through the supply and demand of emission allowances. It details the differences between upstream and downstream regulation, compares cap-and-trade to carbon taxes, and lists existing programs such as the EU-ETS and RGGI.

The document provides a comparative analysis of climate policy tools in the US and China. It details the US's reliance on subnational carbon pricing and evolving SEC disclosure rules, and China's implementation of the world's largest emissions trading system (ETS) and its 'common but differentiated responsibilities' approach to international finance. It concludes by suggesting cooperation on sustainable procurement, emission accounting standards, and subnational carbon market exchanges.

The briefing examines the climate policy landscapes of the U.S. and China, noting that while the U.S. lacks a national carbon price, it has significant subnational activity. China has established the world's largest emissions trading scheme (ETS) but maintains that it is not obligated to provide international climate finance as a developing nation. Both countries are advancing corporate climate disclosure rules, though they differ on the requirement for Scope 3 emissions. The paper suggests cooperation on sustainable procurement, data standards for emission accounting, and subnational carbon market exchanges.

The document provides a comprehensive overview of the climate and energy landscapes in China and the United States. For China, it highlights a 4.7% increase in CO2 emissions in 2023, the growth of non-fossil fuel power capacity to 53.9% of the total, and the implementation of the 'Carbon Peak' pilot program and the restart of the CCER market. For the United States, it notes a projected 1.9% decrease in emissions for 2023, the impact of the Inflation Reduction Act (IRA) and Infrastructure Investment and Jobs Act (IIJA), and the focus on decarbonizing the power sector by 2035. The briefing also details the 'Sunnylands Statement' as a framework for bilateral cooperation on methane and energy transition, while noting tensions regarding trade policies and the potential impact of the 2024 US election.

The briefing outlines potential U.S.-China collaborations to mitigate methane emissions, highlighting research and development in enteric fermentation and rice cultivation, knowledge sharing on biodigesters and remote sensing, and the application of economic and regulatory incentives. It emphasizes the role of subnational engagement, particularly through California, while noting that trade tensions and intellectual property concerns may impede progress.

The American Power Act (APA) proposes a comprehensive US framework to reduce greenhouse gas emissions through a mandatory cap-and-trade system, targeted emission reduction goals, and strategic investments in clean energy. The bill establishes a phased-in cap on covered gases, starting in 2013 and reaching an 83 percent reduction below 2005 levels by 2050. It includes specific provisions to expedite nuclear power development, deploy carbon capture and sequestration (CCS), and provide financial assistance to consumers and workers during the transition to a low-carbon economy. The APA also addresses international climate activities, including the use of international offsets and border adjustments to prevent carbon leakage.

Jonathan Lash, President of the World Resources Institute, testifies that the United States is currently missing an opportunity to lead a clean energy revolution while other nations, including major emitters like China, India, and Brazil, are already implementing significant climate actions. He argues that U.S. legislation is the essential prerequisite for a successful global agreement, as other countries are reluctant to commit without a clear U.S. pledge. Using China as a primary example, Lash asserts that the shift toward clean energy is driven by local needs—such as energy security and pollution control—rather than global charity, creating a massive market for clean technology that the U.S. risks losing if it does not put a price on carbon and support clean energy development.

The document outlines three regional cap-and-trade initiatives in North America: the Regional Greenhouse Gas Initiative (RGGI), the Western Climate Initiative (WCI), and the Midwestern Greenhouse Gas Reduction Accord. These programs involve 23 U.S. states and four Canadian provinces, representing a significant portion of the region's GDP and emissions. RGGI focuses on electric generating units with a 10 percent reduction target by 2018. WCI aims for an economy-wide program reducing emissions 15 percent below 2005 levels by 2020. The Midwestern Accord proposes an economy-wide reduction of 20 percent below 2005 levels by 2020 and 80 percent by 2050.

The document outlines how U.S. climate policies typically target large 'smokestack' emitters and fuel importers to cover approximately 80 percent of emissions. It explains that while regulated facilities face compliance costs—such as purchasing GHG allowances—non-regulated facilities may encounter indirect costs passed through from suppliers. The text highlights that businesses can mitigate costs through energy efficiency and leverage new market opportunities by producing low-GHG technologies.

The document proposes a two-step emissions target mechanism—periodic evaluation and triggered policy changes—to ensure a U.S. carbon tax meets national GHG goals. It suggests four types of trigger responses: automatic tax rate adjustments, increased government spending for emissions reduction, activating 'back-stop' regulations, or streamlined legislative modification. Additionally, it identifies three categories of complementary policies to enhance cost-effectiveness: support for low-carbon innovation (RDD&D), consumer energy savings incentives, and policies targeting 'uncovered' emissions or non-climate co-benefits.

The report examines the intersection of U.S. and Chinese climate policies, highlighting how U.S. cap-and-trade legislation could impact competitiveness and how bilateral frameworks like the 2009 Memorandum of Understanding can foster cooperation. It details China's specific targets for energy intensity, non-fossil fuel energy shares, and forest cover, while noting that China's policy approach relies on a diverse set of tools rather than a single cap-and-trade system.

Michigan can achieve 98 percent of its Clean Power Plan emission reductions through existing clean energy policies, with the remainder achievable via better use of natural gas and coal plant efficiency. The state could further increase reductions by raising its renewable energy and energy efficiency standards, and potentially generate over $160 million annually through a market-based carbon pricing program.

The briefing explains that carbon offsets can lower compliance costs in cap-and-trade systems by allowing regulated sources to compensate for emissions through reductions at unregulated sources. To maintain system integrity, offsets must be "real, surplus (or additional), verifiable, permanent, and enforceable." The author highlights that forestry and agriculture projects face higher quantification uncertainties—including measurement, baseline, leakage, and reversibility risks—which increase transaction costs for certification. Consequently, the document suggests that direct payments may be a more cost-effective alternative to offset markets for these specific high-uncertainty project types.

The report assesses G20 countries' efforts to meet their Paris Agreement commitments, noting that while all have taken concrete actions, progress and ambition vary. Key highlights include India's aggressive solar targets, China's integration of environmental stewardship into its 13th Five-Year Plan, and Indonesia's peatland restoration efforts. However, challenges remain, such as Turkey's planned expansion of coal power and Saudi Arabia's lack of a formal 2030 GHG target.

The document examines how a national carbon price would induce emissions reductions across the U.S. economy, with the most immediate and significant impacts occurring in the electricity sector. It argues that while U.S. Energy Information Administration (EIA) forecasts are conservative, empirical evidence from places like British Columbia suggests that carbon pricing can drive substantial behavioral changes and technological innovation. The authors advocate for a combination of carbon pricing and complementary policies, such as R&D funding and energy-efficiency standards, to overcome market barriers and achieve a target of reducing emissions by more than 80 percent by 2050.

The document highlights that wind power purchase agreements (PPAs) are cheaper than new coal and natural gas plants across most U.S. regions, even without federal tax incentives. It provides specific examples of solar PV projects outcompeting fossil fuels in states like Utah, Colorado, and Georgia. To sustain these trends, the text recommends increasing federal R&D funding, reforming tax incentives to be refundable, and establishing long-term regulatory certainty through carbon pricing or greenhouse gas standards.