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Major progress in resolving the climate change issue is still possible


What America does - or fails to do - in the next few years to solve the problem of climate change will largely determine the fate of the earth and humanity for centuries to come.

Leading environmental economist Robert Repetto, author of America's Climate Problem: The Way Forward, published on the 24th February 2011 by Earthscan, argues that the US needs to embrace policies that accelerate the transition to a new clean energy system - a necessary condition for international cooperation on climate solutions. This transition, Repetto says, is already underway in the US and needs only to be supported and accelerated.

As examples of transition he cites wind and solar power, which have been growing rapidly in the US, and burgeoning investment and innovation in new products to raise energy efficiency.

Says Repetto:

'A far-reaching energy transition over a half century is possible. Such transitions have already happened several times in American history during the past 150 years, and each time, a new surge of economic growth and innovation resulted.

The conditions that gave rise to the current energy system - abundant fossil energy, low energy prices and few environmental constraints - no longer exist. Our energy system is outmoded and so are the government policies that have supported it.'

Repetto argues that climate change and the security risks of energy dependence are massive market failures, in that their costs are not borne directly by those who contribute to the problem. Governments can correct this market failure by enacting an economy-wide price for carbon emissions.

Says Repetto:

'The best way to bring about this price on emissions is through an 'upstream' cap-and-trade system that limits sales of fossil fuels in the US, whether from domestic production or imports. The Federal Government would issue permits to firms that sell fossil fuels…. Reductions in greenhouse gas emissions would be imposed through gradual year-by-year reductions in the permits available. Then, as the supply of fossil fuels in the market gradually diminishes, their prices will rise, establishing a nationwide price on carbon.'

A policy that imposes an economy-wide price on greenhouse gas emissions, says Repetto, would enlist the best features of the American economy in solving the climate problem: its abilities to innovate, its competitiveness, its dynamism and flexibility.

Says Repetto:

'All serious economic studies have found that the economic impacts of an upstream cap-and-trade system and the resulting energy transition would be small and would have a negligible effect on US economic growth. It is ironic that Republicans in Congress and interest groups funded by energy interests are now attempting to demonize this cap-and-trade approach, as it has been used successfully for decades by both Republican and Democratic administrations in controlling other air pollutants, such as lead and sulphur, and is credited with substantial savings to industry in reducing those emissions.'

Repetto argues that upstream cap-and-trade in the US is a key part of finding an effective international climate agreement, and that future negotiations should emphasize three main components:

1. Binding commitments from developed countries to reduce their emissions rapidly

2. Commitments by major developing countries to adopt policies and measures that can reduce GHG emissions without hampering their economic growth, and

3. Reform of the Clean Development Mechanism and other international financing mechanisms such as REDD and international carbon mitigation funds.

Another international benefit of enacting upstream cap and trade in the US would be felt in the European Trading System, where carbon costs would otherwise be affected by the absence of a similar system to link to in the US.

Notes to editors


2.  CONTACTS: For extracts, author articles & blogs, interviews and review copies contact:

3. ADVANCE PRAISE for America's Climate Problem: The Way Forward

'As an accomplished educator, Professor Robert Repetto understands the importance of clarity and coherence of thought. As a creative economist, he knows the need for new and better ideas. In America's Climate Problem, Professor Repetto achieves both. He explains the climate threat lucidly and persuasively. Most important, he offers the new principle of 'up-stream cap and trade' as an imaginative concept designed to break our current political and economic log-jam. We can only hope this important book will be read in the White House and in Congress.'

GARY HART, University of Colorado, former member of the U.S. Senate Environment Committee

'For many years, Robert Repetto has provided incisive analysis and recommendations toward solving our environmental problems. This book may be his most important contribution yet. Its brilliant analysis deserves urgent attention.'

JAMES GUSTAVE SPETH, author of The Bridge at the Edge of the World: Capitalism, the Environment, and Crossing from Crisis to Sustainability

Robert Repetto, an economist, is well-known for his writings on a broad range of environmental policy issues. He is currently Senior Fellow at the United Nations Foundation, working with its climate and energy program. Previously, he was Professor in the Practice of Economics & Sustainable Development at the Yale University School of Forestry and Environmental Studies and, before that, for fifteen years was vice president of the World Resources Institute in Washington DC, directing its work on environmental economics. Earlier in his career, he was an Associate Professor in economics and public health at Harvard University. He has been an advisor to governments on environment and the economy in the United States, Canada, Indonesia, Bangladesh and India.


  1. 'Because the US is the wealthiest of all the major emitting countries and because per capita emissions in the US are far above the world average, it is inconceivable that any international agreement can be reached if the US is to make a smaller percentage reduction than other countries.' Ch.1
  2. 'As the costs of new energy technologies are brought down and the costs of the carbon-intensive technologies rise in the marketplace, a tipping point will be reached. From that point on, there will be an even more rapid diffusion and penetration of renewable energy systems.' Ch.2
  3. 'Amazingly, two-thirds of the energy used to generate electricity, more energy than all that Japan uses, is simply dissipated in cooling towers and cooling waters as waste heat. In other countries, this energy is put to use for heating and cooling. A thousand cities around the world pipe heated water from power plants to buildings, but only a few American cities do so.' Ch.2
  4. 'An upstream cap-and-trade system that keeps economic impacts low and spreads them broadly throughout the economy by price increases in all fossil fuels is fairer than one that concentrates reductions and impacts on a smaller segment of the economy. In an upstream system, every household will bear part of the burden in proportion to its direct and indirect use of fossil fuels. Those more affluent households that use a lot of energy, one way or another, will bear a larger share of the burden. That's only fair.' Ch.4
  5. 'It is ludicrous to behold the CEO of a major electric utility that regularly appears before state public utility commissions arguing for the biggest rate increases it can get pleading for billions of dollars worth of free permit allowances so that he will not have to raise electricity rates on poor widowed grandmothers with fixed incomes…. It is better to compensate Granny directly than to give away billions of dollars in free permits to large energy companies.' Ch.4
  6. 'Though American politicians often excuse their own unwillingness to pass national climate legislation by pointing to China's refusal to make binding international commitments, China has already adopted more effective policies to reduce emissions than the US has.' Ch.5
  7. 'Experts in political messaging and issue framing advise against momentum-building campaigns about the dangers of climate change, which their polls find do not resonate with the public. Instead, they advise messages framed around energy independence, clean energy and the jobs to be had in the new energy economy. This advice is almost surely wrong.' Ch.6
  8. 'People must be convinced of the connection between the increasing frequency of damaging weather events that the country is already experiencing - the intense thunderstorms, the floods, the hurricanes, the heatwaves - and climate change. People must be convinced of the consequences of a continued build-up of atmospheric greenhouse gases and understand that current trends are unsustainable and unacceptable.' Ch.6
  9. 'Even excluding climate change, if the environmental costs of coal-fired power were incorporated into electricity prices, rates would rise by more than $0.03 per kilowatt hour, making wind fully competitive. In order to make coal-fired power less attractive relative to more environmentally benign alternatives, these (environmental) regulations and their enforcement should be tightened. The executive branch already has the statutory authority to do so.' Ch.6
  10. 'With few exceptions, even at this time, vulnerable organizations are at early stages of the research to develop strategies by which to adapt to climate change risks. There have been very few changes in forecasts, plans, design criteria, investment decisions, budgets or staffing patterns in response to climate risks.' Ch.7
  11. 'To say that the United States can adapt to climate change does not imply that the United States will adapt. Without strong national leadership and concerted efforts to remove…barriers and obstacles, adaptation to climate change will continue to lag. It will be largely reactive rather than anticipatory and preventive.' Ch.7

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