How are
people changing
the climate?

Basics

3. How can we hinder
man-made climate change? 

What can the government do? 

Despite efforts to reduce emissions of greenhouse gases, emissions are still increasing in most places (read more about increasing emissions here). It is unlikely that the increase in emissions of greenhouse gases will slow down through voluntary efforts of concerned individuals and businesses alone. And since households (both families and single persons) and private companies are responsible for the bulk of emissions, governments in many countries, including the EU, are therefore attempting to create incentives for them to reduce their emissions. The instruments they use include the following:

Taxes

If you have to pay a tax to emit greenhouse gases, it pays off to avoid emitting in the first place. Some European countries have thus introduced special taxes on the fossil fuels that cause emissions of CO₂. This means that prices of gasoline, heating oil, and other fossil fuels are higher, which gives an incentive to use less. As long as there are only a few countries that have these taxes, businesses that use a lot of energy may be tempted to move their production to other countries where they do not have to pay these taxes. This is why countries with carbon taxes often exempt industries that are in heavy competition with foreign firms from having to pay taxes.

Emissions permits

The government can set a limit for how much greenhouse gases can be emitted within the country. It can then issue permits (also called “allowances” or “quotas”) to emit greenhouse gases. An emissions permit is a certificate that gives the holder the right to emit a certain amount of greenhouse gases to the atmosphere. The government can decide whether or not those who are given permits should be allowed to sell them to others. This kind of “emissions trading” ensures that emissions reductions are as inexpensive as possible for business and industry. Businesses that would have to invest a lot of money in reducing emissions can buy extra permits instead. Companies that can reduce their emissions at a reasonable cost can do so, and then sell their permits for a profit. A system of permits and emissions trading can also be limited to certain industries.

Laws and regulations

Governments regulate which products can be sold. For example, they can forbid the sale of electric appliances that use more electricity than necessary and cars that use too much gasoline. In cold countries, the government can introduce regulations for insulating buildings to minimize the amount of energy used for heating. Governments can also forbid activities in industry and agriculture that generate particularly high amounts of emissions, or require special equipment that reduces emissions. For example, owners of garbage dumps or manure tanks can be required to capture the methane that is generated. Coal- and gas-fired power plants can be required to utilize the heat generated in the electricity production process.

Subsidization

Governments can create incentives for businesses and households to invest in equipment that reduces emissions. In countries where homes need heating in the winter, governments can subsidize those who want to add insulation or those who wish to invest in heating elements that run on biofuel. In some countries, certain types of vehicles, such as electric cars, may be exempted from registration fees or from paying at toll booths.

Research

By funding research, the government can stimulate technological innovation that reduces emissions of greenhouse gases – such as wind mills, CO₂ capturing, or cars that run on hydrogen.

The disadvantage of many of these instruments is that they cost money – for the government, the firms, or households. Some of them are relatively inexpensive to implement, others very costly. The question is whether we believe that the benefit in terms of reduced danger of climate change is worth the costs.

Wind power -
a renewable energy source

Wind power is a renewable energy source that provides electric power without generating emissions of CO₂. This is why governments in many countries support the establishment of wind power plants. Wind power represents only a small fraction of the energy supply in most countries, but Germany and Great Britain, for example, have plans to expand their wind power supply. The Danish wind mill industry produces about half of the wind mills on the world market. Sales in 2002 were about 22 billion Danish kroner. It is expected that wind power will cover 17% of Denmark’s electricity needs in 2003.

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Author: Camilla Schreiner - CICERO (Center for International Climate and Environmental Research - Oslo) - Norway. Scientific reviewers: Andreas Tjernshaugen - CICERO (Center for International Climate and Environmental Research - Oslo) - Norway - 2004-01-20 and Knut Alfsen - Statistics Norway - Norway - 2003-09-12. Educational reviewer: Nina Arnesen - Marienlyst school in Oslo - Norway - 2004-03-10. Last update: 2004-03-27.