IN DECEMBER 2015, the historic COP21 climate conference in Paris gave rise to a groundbreaking climate agreement, signed by representatives of 195 nations plus the European Union. Several months later, governments and policymakers are thinking about how to implement the pledges that each participating nation has made. In a paper published in the journal Nature Climate Change on August 22, Joseph Aldy, associate professor of public policy at Harvard Kennedy School (HKS), joins 13 co-authors from various universities and research institutions in exploring the need for economic tools and analysis in informing the review of each country’s climate pledge.
“The Paris Agreement establishes a new ‘pledge and review’ framework for international climate policy,” Aldy explained. “Every country voluntarily pledges an emission mitigation goal, which would then be subject to a multilateral review. To implement this new approach, the Paris Agreement calls for a new system of transparency to enable review of nations' emission mitigation pledges.”
The Nature Climate Change paper employs four global energy-economic models to evaluate each country’s Paris pledge.
“A suite of models permits us to draw more robust conclusions about the emission pledges and exploit the respective strengths of each model,” Aldy said. “We produce a variety of metrics–estimated emissions abatement, reductions in emission intensity, marginal costs and total costs as a share of GDP–to facilitate a comparison of mitigation effort among large developed and developing countries: China, the EU, India, Japan, Russia, South Africa, and the U.S.” The metrics showed the need for differentiated effort among countries, with wealthier countries generally mitigating more emissions and requiring higher carbon prices necessary to deliver on their emission pledges than developing countries.
“Our research can help inform the design of the Paris transparency regime, which negotiators will address at the 2016 Marrakech climate talks and beyond,” Aldy said. “Governments and climate policy stakeholders can use the metrics we produce to assess and compare mitigation effort among countries. Our approach to review also emphasizes the importance of policy learning, as our results illustrate the potential for more cost-effective implementation to lower the costs of attaining the Paris Agreement's emission goals.” The implementation of the pledges will require adjustment and recalibrating for each country, but Aldy added, “This analysis of the emission mitigation pledges before their implementation may also serve as a benchmark for ex post evaluation of the pledges.”