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Lars Calmfors: climate policy, one should be careful not to put all eggs in the same basket

global warming poses perhaps the greatest challenge that humanity has faced. The paris agreement in 2015 set ambitious targets to limit temperature increase. But the development so far does not indicate that they will be achieved.

A central question for the nordic countries is how they are in this situation best contribute to the global climate. It is the theme of the just-published issue of the Nordic Economic Policy Review (NEPR) as edited by John Hassler and me.

the Volume deals with different aspects of nordic climate policy. A first is how it affects other countries. It can be done in many ways. For example, the so-called carbon leakage to occur. This means that reducing carbon dioxide emissions in the Nordic countries leads to increased emissions in other regions. It occurs when the reduced demand for fossil fuels in Sweden, for example, contributes to lower world prices for these, which stimulates demand in the rest of the world. It may also occur if companies with high emissions move production to countries with less ambitious climate policy.

It is essential that the global emissions are reduced: for the climate, it does not matter where the reduction takes place.

be achieved at the lowest possible cost. It is effective that a country pays for reductions in another country if they can be made cheaper there. The crucial point is that the global emissions are reduced: for the climate, it does not matter where the reduction takes place.

The nordic countries should therefore use the flexibility of EU rules in regards to buy utsläppsmöjligheter from other member states, also for the part of the economy (domestic transport, housing, and so on) that are not covered by the ordinary EUROPEAN system for emissions trading.

is probably that the nordic countries are so small. The direct climate effects of emissions in the Nordic countries is therefore marginal. It also applies to the above-discussed koldioxidläckagen. However, other indirect effects be of great importance.

Politicians often emphasize demonstration effects linked, thus, to other countries ' policies can be influenced to be more ambitious about the nordic countries show that it is possible to combine major national climate efforts with growth.

It usually also claimed that it is easier to convince other countries to take on costs in order to counter klimatförsämringen if we ourselves make it. There is probably much in the argumentation even if there is also a risk that a climate policy that turns out expensive can discourage others.

highlights in the NEPR-volume – mainly by Mads Greaker, Rolf Golombek and Michael Hoel – is different, however, the spread of new green technologies to other countries. It requires both that the nordic countries have a comparative advantage in the development of certain technologies, and that these have great potential use in the rest of the world. The example mentioned is offshoreproducerad wind power (Denmark and Norway) and ccs (Norway).

the Chances of a technological breakthrough of global relevance increases if the nordic countries can cooperate on such projects. The focus should then be right to contribute to the international dissemination of technology, not to gain a competitive advantage for domestic relative to foreign enterprises.

as discussed by Naghmeh Nasiritousi and Karin Bäckstrand in their contributions, is klimatklubbar: countries with particularly large climate ambition can form such a club in which they grant each other reciprocal benefits. The idea is to strengthen the driving forces also for other to raise their aspirations in order to participate.

Klimattullar on the import of goods produced with large koldioxidsläpp as a result can be a way to organize a klimatklubb on. Such proposals have been put forward in the international klimatdiskussionen (and also of the green Party in Sweden). The nordic countries would be able to operate to the EU countries in the face of such duties.

a second-best option to increase the cost of emissions in countries that do not reduce their emissions enough, not least the US, where Trumpadministrationen planning to leave the paris agreement. At the same time, there is a risk of protectionist abuse of such duties. And it is easy to see how they could lead to escalating trade wars in a situation where such is already in progress.

The ideal situation would be if the rules for klimattullar could be developed within the world trade organisation (WTO). But it is probably also in the best cases a very time-consuming process, and in the worst case is not a proper way even in the long term.

to the best contribution the nordic countries can make to the fight klimatförsämringen is through the development of technology that can be other to the part and that it requires more of the nordic cooperation in order to get the maximum effect. But not such a policy is risk-free. There are many examples of failed industrial policy support, when politicians have tried to identify the future industries.

There is a strong argument to not ”put all eggs in the same basket”, but have a reasonable degree of diversification of ecec services for green technology development.

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