Incentives for Innovation Can Drive Decarbonization, Esty Tells Lawmakers

While the top-down regulatory policies of the 20th century achieved critical advances in environmental protection, the challenges of the 21st century demand new strategies, Daniel Esty, Hillhouse Professor of Environmental Law and Policy at the Yale School of Forestry & Environmental Studies and Yale Law School, told U.S. lawmakers this week.

esty environment climate change subcommittee december 19

In testimony before the House Subcommittee on Environment and Climate Change of the Committee on Energy and Commerce, Esty said that the response to the climate challenge will require a multi-dimensional framework which takes advantage of advances in public health and ecosystem science, as well as the new technologies that have transformed much of American life but have not yet been fully integrated into the environmental arena, such as the internet, Big Data, and smartphones.

“To decarbonize our economy at the speed and scale necessary to tackle climate change will require a portfolio of policies — some of which entail economy-wide initiatives, including carbon pricing, but others of which might be advanced within specific sectors on a more targeted basis,” he said. 

Esty was invited to testify before the subcommittee at its latest in a series of hearings on how to achieve a 100-percent clean economy by 2050. The subcommittee is chaired by U.S. Rep. Paul Tonko, D-N.Y.  

Speaking to lawmakers, he suggested that this multi-dimensional climate policy framework should emphasize: 

Yale Environmental Dialogue

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No single solution will solve the complex environmental challenges facing humankind. The path to a sustainable future is going to require many big ideas on multiple fronts. The Yale Environmental Dialogue, a new F&ES initiative, is trying to do something about that. Read more
  1. Incentives: Rather than traditional environmental regulatory policies that tell people and companies what not to do, the U.S. needs a structure of incentives that engage creativity and entrepreneurship to deliver innovative clean energy solutions. 
  2. Innovation: Any new framework must prioritize innovation — in the development of technology, but also in policy design, incentives for changed behavior, public engagement, partnerships, and finance. 
  3. Information: By creating a set of sustainability indicators to gauge the successes of nations, states, cities, companies and households, the U.S. might better promote competition “that celebrates leaders, calls out laggards, and highlights best practices.”  
  4. Investment: Creative strategies for finance, he said, should be a priority in any climate policy framework, including those that support decarbonization through green banks, green bonds, and other creative sustainable finance tools. 


“With the right structure of incentives, emphasis on innovation, a commitment to redesigning our policy strategies to take advantage of the improved science and cutting-edge technologies of our Information Age, and a fresh approach to financing clean energy investments based on using limited public funds to leverage private capital, we can advance decarbonization, improve environmental outcomes more generally, strengthen our economy, enhance America’s global competitiveness, and promote the required energy transition in an efficient and equitable way,” he said. 

– Kevin Dennehy    kevin.dennehy@yale.edu    203 436-4842
 
PUBLISHED: December 6, 2019
 
Note: Yale School of the Environment (YSE) was formerly known as the Yale School of Forestry & Environmental Studies (F&ES). News articles posted prior to July 1, 2020, refer to the School's name at that time.

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