Could an Industrial Finance Corporation Help the United States Succeed with Clean Tech Manufacturing?

The United States is historically one of the world’s largest investors in renewable energy research and development (R&D). Yet, it has struggled to build a large manufacturing industry for the technologies needed in a clean energy transition. U.S. universities and startups have excelled at inventing new technologies, but much of the global production capacity in these sectors is located elsewhere. A key reason for the lack of domestic clean tech manufacturing has been the scarcity of capital among clean technology firms. Clean energy startups have struggled to raise sufficient funds to invest in domestic manufacturing capacity. This research brief explains why political leaders regularly promise domestic manufacturing jobs in clean energy industries, lays out the reasons why such promises have rarely been met in the past, and assesses the IFCUS as a way to deliver on such promises. Establishing an organization akin to a state-owned development bank for manufacturing is essential if the United States wants to increase the share of clean energy technologies manufactured domestically. Doing so would help increase the number of jobs in clean energy industries, bolster middle-class employment, help build a broad political coalition in favor of action on climate change, and reduce dependence on China in clean energy supply chains at a time when the U.S.-China relationship has come under significant stress.

To achieve deep cuts in US emissions, state-driven policy is only slightly more expensive than nationally uniform policy

Using a multi-sector model of human and natural systems, we find that the nationwide cost from state-varying climate policy in the United States is only one-tenth higher than that of nationally uniform policy. The benefits of state-led action — leadership, experimentation and the practical reality that states implement policy more reliably than the federal government — do not necessarily come with a high economic cost.

Elite vs. mass politics of sustainability transitions

While the past decade of transitions scholarship has increasingly acknowledged the centrality of politics, key questions on transition politics deserve further research. Here, we develop a heuristic framework from the discipline of political science that separates transition politics into the classic categories of interests, ideas, institutions, as well as elite and mass politics. Based on this framework, we conduct a review of existing transitions literature on politics. We find that some areas of our framework are better covered than others. For instance, while the institutional foundations of elite politics are relatively well researched, there are only few studies on interests and ideas in mass politics. In geographical and sectoral terms, research is biased toward energy transitions in Europe and North America. Based on our review, we map areas for future research we believe to be indispensable to better understand varieties of transition politics.

The surprisingly inexpensive cost of state-driven emission control strategies

Traditionally, analysis of the costs of cutting greenhouse gas emissions has assumed that governments would implement idealized, optimal policies such as uniform economy-wide carbon taxes. Yet actual policies in the real world, especially in large federal governments, are often highly heterogeneous and vary in political support and administrative capabilities within a country. While the benefits of heterogeneous action have been discussed widely for experimentation and leadership, little is known about its costs. Focusing on the United States, we represent plausible variation (by more than a factor of 3) in the stringency of state-led climate policy in a process-based integrated assessment model (GCAM-USA). For a wide array of national decarbonization targets, we find that the nationwide cost from heterogeneous subnational policies is only one-tenth higher than nationally uniform policies. Such results hinge on two critical technologies (advanced biofuels and electricity) for which inter-state trade ameliorates the economic efficiencies that might arise with heterogeneous action.

Incorporating political-feasibility concerns into the assessment of India’s clean-air policies

Political-feasibility concerns are at the center of real-world air-pollution policymaking. Yet, these concerns are often not represented in leading decision-support tools that have been used for assessing policies’ environmental impacts. Focusing on a wide range of clean-air policies in India, we assess their political-feasibility scores on the basis of public opinion, market, and institutional considerations and then incorporate these scores into the evaluation of environmental impacts by using an integrated assessment model (GAINS-South Asia). We demonstrate that although some policies with substantial potential to mitigate air pollution are also highly politically feasible (e.g., replacing solid fuels with cleaner fuels in households), others can be less politically feasible (e.g., banning agricultural waste burning). Because some clean-air policies co-reduce CO2 emissions and aerosols, considering varying degrees of political feasibility is particularly important in achieving air-pollution and climate objectives simultaneously because of its implications on the implementation scale and policy sequence.