The United States needs to combine incentives and regulations to achieve net-zero emissions
A key analysis by the National Academy of Sciences, Engineering, and Medicine of the United States indicates that the path to net-zero emissions by 2050 is not unique. The country must integrate economic stimulus policies with strict regulatory mandates to succeed. Relying exclusively on one approach would leave the goal out of reach, according to the study. 🎯
Effectiveness of available policy tools
The document, commissioned by the U.S. Congress, evaluates how different instruments work. It examines tax credits, efficiency standards, and mechanisms for pricing carbon. Each tool has a distinct profile of advantages and disadvantages. For example, subsidies can accelerate the adoption of clean technologies, but their cost falls on taxpayers. In contrast, mandatory regulations ensure objectives are met, although they often generate political opposition and legal disputes.
Main findings of the report:- Financial incentives: Accelerate innovation and adoption of new technologies, but their fiscal impact is high.
- Direct regulations: Guarantee emission reductions in specific sectors, but can be rigid and generate litigation.
- Carbon pricing: Creates a clear market signal, but its political acceptance is complex.
An intelligent combination of approaches can overcome the limitations that each instrument has individually.
A dual strategy for the transition
The experts propose a hybrid policy framework. They suggest using incentives to foster innovation and reduce costs in emerging technologies, such as carbon capture or green hydrogen production. In parallel, they recommend applying strong regulations in sectors where clean alternatives are already viable and competitive, such as electric vehicles or solar and wind energy.
Objectives of the combined strategy:- Create a regulatory environment that is stable and predictable to guide long-term private sector investments.
- Decarbonize the entire economy, acting on power generation, transportation, industry, and buildings simultaneously.
- Balance environmental effectiveness with economic efficiency and social acceptance.
The political challenge ahead
The report makes it clear that the main obstacle may not be technical. The true challenge lies in getting a frequently divided Congress to approve a comprehensive legislative package. This package must include both "carrots" (incentives) and "sticks" (regulations), without the debate focusing solely on the immediate political cost of each measure. Success depends on building a consensus that transcends usual partisan divisions. ⚖️