Our thinking

Variety is the best policy

30 August, 2024

This week’s news reminds us (if we needed reminding) that there is no silver bullet to solving climate change. A study analysing 1,500 policies across 41 countries found that only a small fraction – just 63 – were effective at significantly reducing emissions. The research reveals a sobering truth: many policies are too narrowly focused or poorly designed to drive the systemic changes needed to hit global climate targets.

However, the effective cases do offer a blueprint for success, demonstrating that policy combinations – mixing financial measures with regulations – are far more impactful than single policy measures. A key example of this is the decarbonisation of the UK’s electricity sector, which was achieved through a combination of a carbon price floor, renewable energy subsidies, and a coal phase-out. By contrast, single policies, like bans or pricing mechanisms without additional measures fell short in many jurisdictions. Taxation was the ‘notable exception’ in causing large falls in emissions without the support of other policies.

Critics argue that the study overlooked key policies that cause gradual change without clear impacts on emissions trends. For example, attributing the UK’s electricity decarbonisation solely to the 2013 carbon price floor neglects the impacts of the 2008 Climate Change Act, for example. But the study nevertheless offers valuable insight into how regulation can be more effective when delivered through a policy mix.

As we march toward 2030, the world faces a 23 billion ton emissions gap. Scaling up success stories will require not just more policies, but better ones – innovative combinations that tackle multiple angles of the problem at once. While it’s clear we’ve made some strides, much more remains to be done.

By Louise Podmore