Search Climate Insights Directory

This briefing outlines the Climate Policy Initiative's (CPI) framework for evaluating the efficiency of public financial interventions, such as green banks, in supporting the transition to a low-carbon economy. It focuses on identifying financial barriers and determining the most effective risk-bearing mechanisms and implementing institutions to address them.

The report outlines a systematic approach to identifying and addressing financial barriers to low-carbon investment. It proposes an analysis matrix that intersects various financial stakeholders with specific barriers—such as high cost of capital, perceived risk, and split incentives—to determine where public intervention is most effective. The authors argue that dedicated institutions like green banks can be advantageous by co-housing policies to allow for flexible funding, creating a 'brain trust' of expertise, and simplifying access for consumers. The document also provides a table of existing public green infrastructure banks in the OECD, including examples from Australia, the UK, Korea, Canada, and the USA.

The briefing argues that carbon markets have historically failed to increase climate commitments and have often undermined emissions reductions through 'hot air' loopholes. It recommends that the Paris agreement prevent double counting, ensure that international trading is supplementary to ambitious domestic action, and restrict market mechanisms to countries with adequate carbon budgets. The text notes a shift from a single global UN-led market toward a fragmented landscape of national and regional initiatives, while advocating for a transition from carbon offsets toward direct financial support for climate actions in developing countries.

California has successfully decoupled economic growth from greenhouse gas emissions through a policy blend of performance standards and a broad cap-and-trade program. Since 2006, the state has seen a 7 percent decline in emissions while experiencing robust job growth, particularly in the green technology sector. Key achievements include significant adoption of plug-in electric vehicles, a growing renewable energy portfolio, and the influence of its building and appliance codes on other U.S. states and federal policy. The state is now shifting focus toward 2030 targets, including a 50 percent renewable portfolio standard and a goal to reduce economy-wide emissions by 40 percent below 1990 levels.

The briefing challenges the notion that variable renewables will limit their own growth by depressing wholesale electricity prices. It contends that these concerns rely on static models of the grid and ignore the synergistic effects of complementary supply resources, flexible demand-side responses, and the decreasing cost of storage. By shifting from incremental to whole-system thinking and updating 20th-century market designs, the author asserts that wind and solar can continue to expand without facing practical economic limits.

Carbon Market Watch argues that while few countries explicitly include international trading in their Intended Nationally Determined Contributions, carbon pricing is already used by jurisdictions representing 40% of the global economy. The organization warns that a lack of clear international rules could lead to non-harmonized standards and double counting. It recommends strict principles for carbon markets, including the avoidance of 'hot air' credits, the requirement for net atmospheric benefits, and the exclusion of REDD-plus from carbon markets.

Fuel cells generate electricity through a chemical reaction between oxygen and hydrogen, offering a high-efficiency, low-emission alternative to combustion engines and batteries. While they excel in reliability, scalability, and energy density, widespread adoption is hindered by high costs—particularly the need for platinum in PEM cells—and the lack of hydrogen fueling infrastructure. Applications range from portable electronics and stationary power (including combined heat and power systems) to transportation. In the U.S., the Department of Energy and various state-level policies, such as Renewable Portfolio Standards and tax credits, are working to reduce system costs and expand infrastructure to make fuel cells more competitive with gasoline-powered vehicles.

The report analyzes the financial landscape of large-scale renewable energy in California, concluding that while most projects are well-supported by existing policies like the Production Tax Credit and Renewable Portfolio Standard, specific gaps remain. These gaps include high transaction costs for tax equity, limited financing access for small and medium enterprises (SMEs), and high risks for early-stage innovative technologies. The document proposes that a public institution or 'green bank' could address these by aggregating and securitizing projects, providing alternative loan security (such as property tax-based repayment), and offering loan guarantees or concessional lending for innovative technologies.

The report outlines a three-step approach for improving the performance of publicly-owned utilities (POUs). The first step involves 'no regrets' actions, such as engaging diverse stakeholders to define goals and using Integrated Resource Plans (IRPs) to balance reliability, cost, and environmental targets. The second step focuses on governance evolutions, specifically delineating the roles of boards and management and implementing board self-evaluations. The third step suggests more drastic measures for lagging performance, including revenue decoupling to support energy efficiency, performance-based employee compensation, and the use of third-party non-profit entities for specific utility functions.

The report argues that smart land use policy is critical for California to meet its 2030 decarbonization goals. Using the RapidFire model and E3 California Pathways data, the study finds that 'More Compact' and 'Infill Focus' scenarios can lead to statewide emissions reductions of 40-41% below 1990 levels when combined with aggressive energy technology deployment. Beyond climate targets, smart growth is projected to deliver significant co-benefits, including billions of dollars in household and infrastructure cost savings, improved public health outcomes through reduced air pollution, and the preservation of greenfield land. The authors recommend that the California Air Resources Board (CARB) strengthen emissions reduction targets under SB 375 and provide substantial funding to support cities and regions in implementing target-compliant land use plans.

The report evaluates the effectiveness of public and private financial incentives for reducing forest emissions between 2005 and 2015. It finds that while over US$3 billion in public funds were committed to performance-based REDD+ payments by 2014, actual disbursements lagged at just over US$1 billion. The private forest carbon market experienced rapid growth until 2011 but subsequently declined, with the market value falling to approximately US$150 million by 2013. The document highlights that the voluntary carbon market alone is insufficient to scale up demand and emphasizes the need for integration into emissions trading systems.

The document argues that urban GHG mitigation is most effective when governments at different levels operate according to their comparative advantages. It categorizes city roles into policy leaders, critical implementers, and strategic partners, mapping these roles to specific abatement potentials in transport, buildings, and waste. The authors emphasize that national governments must provide enabling actions—specifically financial support, technical capacity, and policy alignment—to unlock this potential. Case studies of China, the United States, and Brazil illustrate varying degrees of vertical integration and identify specific national-level gaps that hinder city-scale climate action.

California is facing a critical water supply shift as climate change depletes traditional snowmelt-fed reservoirs, leading to an increased reliance on groundwater. The document highlights that snow is melting up to 30 days earlier than in the mid-twentieth century and that the state's surface-water storage is not designed for a future of rain-dominant precipitation. This has led to the over-pumping of aquifers, particularly in the Central Valley. To address this, the document advocates for the implementation of the Sustainable Groundwater Management Act (SGMA) of 2014, which requires local agencies to develop sustainability plans by 2020. The authors propose capturing floodwaters to recharge aquifers, which would simultaneously reduce flooding risks and provide a buffer against future droughts.

The report finds that battery-electric vehicles (BEVs) produce significantly lower lifetime global warming emissions than comparable gasoline cars, despite higher emissions during the manufacturing process. On average, BEVs sold in the U.S. produce less than half the emissions of gasoline vehicles, with the extra manufacturing burden offset within 6 to 16 months of driving. The environmental benefit of EVs increases as the U.S. electricity grid shifts from coal to renewable energy sources.

The chemical industry is using federal TSCA reform and the TTIP trade agreement to prevent US states from enacting chemical safety laws that exceed federal standards, potentially turning federal regulations into a ceiling rather than a floor.

The report analyzes how battery energy storage can provide thirteen different services across three grid levels: transmission, distribution, and behind-the-meter. It argues that while single-use batteries are often underutilized and economically unviable, 'stacking' multiple services—such as combining demand charge reduction with wholesale grid services—can make storage a cash-positive investment. Through four U.S. case studies, the report demonstrates that behind-the-meter systems are technically capable of providing the widest array of services, though significant regulatory barriers currently hinder this potential.

The document outlines the economic and environmental benefits of transitioning Oregon's transportation sector from petroleum to clean fuels, specifically electricity and biofuels. It highlights the cost-effectiveness of electric vehicles (EVs) and the state's potential to produce advanced biofuels from waste, residues, and energy crops. Central to this transition is the Clean Fuels Program, which aims for a 10 percent reduction in carbon emissions per unit of fuel by 2025 and aligns with regional policies in California and British Columbia to create a larger market for low-carbon alternatives.

The Union of Concerned Scientists (UCS) analysis finds that two-thirds of U.S. states may be exposing electricity consumers to financial risks due to overreliance on natural gas. These risks include price volatility, potential carbon pricing costs, and the possibility of stranded assets such as underused plants and pipelines. The report rates states across five categories, identifying Florida as the only state with a "High" risk rating in all five. To mitigate these risks, the report advocates for prioritizing renewable energy and energy efficiency over natural gas as a primary solution for carbon reduction under the federal Clean Power Plan.

The report argues that the proposed Oakland Bulk and Oversized Terminal (OBOT) poses significant risks to public health, water security, and local ecosystems, particularly if used to export coal. The author highlights that current design plans are conceptual and lack enforceable controls for dust and emissions. Key concerns include the consumption of 79.2 million gallons of water annually for dust control during a record drought, the release of up to 18,300 tons of coal dust per year within California from uncovered rail cars, and increased cancer risks from diesel particulate matter in West Oakland. Additionally, the report notes that the project's scale would cause significant traffic congestion at 55 at-grade rail crossings and create substantial noise pollution. The author concludes that these impacts were not addressed in the project's CEQA review.

Large-scale solar PV systems have grown rapidly, accounting for over half of all solar capacity installed between 2010 and 2014. These projects benefit from economies of scale, with costs in 2013 averaging half of those in 2010, making them significantly cheaper than residential solar. While they generate electricity without carbon emissions or water consumption, they require substantial land area, which can impact habitats. Mitigation strategies include using degraded lands, such as landfills. Growth is supported by federal tax credits, state renewable electricity standards, and permitting reforms.