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just transition
7 Steps to What a Real Renewable Energy Transition Looks Like
Historically, an overhaul for humanity's energy system would take hundreds or many thousands of years. The rapid shift to cleaner, more sustainable sources of power generations will easily be the most ambitious enterprise our species has ever undertaken.
Aug 25, 2024
Humanity’s transition from relying overwhelmingly on fossil fuels to instead using alternative low-carbon energy sources is sometimes said to be unstoppable and exponential. A boosterish attitude on the part of many renewable energy advocates is understandable: overcoming people’s climate despair and sowing confidence could help muster the needed groundswell of motivation to end our collective fossil fuel dependency. But occasionally a reality check is in order.
The reality is that energy transitions are a big deal, and they typically take centuries to unfold. Historically, they’ve been transformative for societies—whether we’re speaking of humanity’s taming of fire hundreds of thousands of years ago, the agricultural revolution 10,000 years ago, or our adoption of fossil fuels starting roughly 200 years ago. Given (1) the current size of the human population (there are eight times as many of us alive today as there were in 1820, when the fossil fuel energy transition was getting underway), (2) the vast scale of the global economy, and (3) the unprecedented speed with which the transition will have to be made in order to avert catastrophic climate change, a rapid renewable energy transition is easily the most ambitious enterprise our species has ever undertaken.
As we’ll see, the evidence shows that the transition is still in its earliest stages, and at the current rate, it will fail to avert a climate catastrophe in which an unimaginable number of people will either die or be forced to migrate, with most ecosystems transformed beyond recognition.
Implementing these seven steps will change everything. The result will be a world that’s less crowded, one where nature is recovering rather than retreating, and one in which people are healthier (because they’re not soaked in pollution) and happier.
We’ll unpack the reasons why the transition is currently such an uphill slog. Then, crucially, we’ll explore what a real energy transition would look like, and how to make it happen.
Why This Is (So Far) Not a Real Transition
Despite trillions of dollars having been spent on renewable energy infrastructure, carbon emissions are still increasing, not decreasing, and the share of world energy coming from fossil fuels is only slightly less today than it was 20 years ago. In 2024, the world is using more oil, coal, and natural gas than it did in 2023.
While the U.S. and many European nations have seen a declining share of their electricity production coming from coal, the continuing global growth in fossil fuel usage and CO2 emissions overshadows any cause for celebration.
Why is the rapid deployment of renewable energy not resulting in declining fossil fuel usage? The main culprit is economic growth, which consumes more energy and materials. So far, the amount of annual growth in the world’s energy usage has exceeded the amount of energy added each year from new solar panels and wind turbines. Fossil fuels have supplied the difference.
So, for the time being at least, we are not experiencing a real energy transition. All that humanity is doing is adding energy from renewable sources to the growing amount of energy it derives from fossil fuels. The much-touted energy transition could, if somewhat cynically, be described as just an aspirational grail.
How long would it take for humanity to fully replace fossil fuels with renewable energy sources, accounting for both the current growth trajectory of solar and wind power, and also the continued expansion of the global economy at the recent rate of 3 percent per year? Economic models suggest the world could obtain most of its electricity from renewables by 2060 (though many nations are not on a path to reach even this modest marker). However, electricity represents only about 20 percent of the world’s final energy usage; transitioning the other 80 percent of energy usage would take longer—likely many decades.
However, to avert catastrophic climate change, the global scientific community says we need to achieve net-zero carbon emissions by 2050—i.e., in just 25 years. Since it seems physically impossible to get all of our energy from renewables that soon while still growing the economy at recent rates, the IPCC (the international agency tasked with studying climate change and its possible remedies) assumes that humanity will somehow adopt carbon capture and sequestration technologies at scale—including technologies that have been shown not to work—even though there is no existing way of paying for this vast industrial build-out. This wishful thinking on the part of the IPCC is surely proof that the energy transition is not happening at sufficient speed.
Why isn’t it? One reason is that governments, businesses, and an awful lot of regular folks are clinging to an unrealistic goal for the transition. Another reason is that there is insufficient tactical and strategic global management of the overall effort. We’ll address these problems separately, and in the process uncover what it would take to nurture a true energy transition.
The Core of the Transition is Using Less Energy
At the heart of most discussions about the energy transition lie two enormous assumptions: that the transition will leave us with a global industrial economy similar to today’s in terms of its scale and services, and that this future renewable-energy economy will continue to grow, as the fossil-fueled economy has done in recent decades. But both of these assumptions are unrealistic. They flow from a largely unstated goal: we want the energy transition to be completely painless, with no sacrifice of profit or convenience. That goal is understandable, since it would presumably be easier to enlist the public, governments, and businesses in an enormous new task if no cost is incurred (though the history of overwhelming societal effort and sacrifice during wartime might lead us to question that presumption).
But the energy transition will undoubtedly entail costs. Aside from tens of trillions of dollars in required monetary investment, the energy transition will itself require energy—lots of it. It will take energy to build solar panels, wind turbines, heat pumps, electric vehicles, electric farm machinery, zero-carbon aircraft, batteries, and the rest of the vast panoply of devices that would be required to operate an electrified global industrial economy at current scale.
In the early stages of the transition, most of that energy for building new low-carbon infrastructure will have to come from fossil fuels, since those fuels still supply over 80 percent of world energy (bootstrapping the transition—using only renewable energy to build transition-related machinery—would take far too long). So, the transition itself, especially if undertaken quickly, will entail a large pulse of carbon emissions. Teams of scientists have been seeking to estimate the size of that pulse; one group suggests that transition-related emissions will be substantial, ranging from 70 to 395 billion metric tons of CO2 “with a cross-scenario average of 195 GtCO2”—the equivalent of more than five years’ worth of global carbon CO2 emissions at current rates. The only ways to minimize these transition-related emissions would be, first, to aim to build a substantially smaller global energy system than the one we are trying to replace; and second, to significantly reduce energy usage for non-transition-related purposes—including transportation and manufacturing, cornerstones of our current economy—during the transition.
In addition to energy, the transition will require materials. While our current fossil-fuel energy regime extracts billions of tons of coal, oil, and gas, plus much smaller amounts of iron, bauxite, and other ores for making drills, pipelines, pumps, and other related equipment, the construction of renewable energy infrastructure at commensurate scale would require far larger quantities of non-fuel raw materials—including copper, iron, aluminum, lithium, iridium, gallium, sand, and rare earth elements.
While some estimates suggest that global reserves of these elements are sufficient for the initial build-out of renewable-energy infrastructure at scale, there are still two big challenges. First: obtaining these materials will require greatly expanding extractive industries along with their supply chains. These industries are inherently polluting, and they inevitably degrade land. For example, to produce one ton of copper ore, over 125 tons of rock and soil must be displaced. The rock-to-metal ratio is even worse for some other ores. Mining operations often take place on Indigenous peoples’ lands and the tailings from those operations often pollute rivers and streams. Non-human species and communities in the global South are already traumatized by land degradation and toxification; greatly expanding resource extraction—including deep-sea mining—would only deepen and multiply the wounds.
The second materials challenge: renewable energy infrastructure will have to be replaced periodically—every 25 to 50 years. Even if Earth’s minerals are sufficient for the first full-scale build-out of panels, turbines, and batteries, will limited mineral abundance permit continual replacements? Transition advocates say that we can avoid depleting the planet’s ores by recycling minerals and metals after constructing the first iteration of solar-and-wind technology. However, recycling is never complete, with some materials degraded in the process. One analysis suggests recycling would only buy a couple of centuries’ worth of time before depletion would bring an end to the regime of replaceable renewable-energy machines—and that’s assuming a widespread, coordinated implementation of recycling on an unprecedented scale. Again, the only real long-term solution is to aim for a much smaller global energy system.
The transition of society from fossil fuel dependency to reliance on low-carbon energy sources will be impossible to achieve without also reducing overall energy usage substantially and maintaining this lower rate of energy usage indefinitely. This transition isn’t just about building lots of solar panels, wind turbines, and batteries. It is about organizing society differently so that is uses much less energy and gets whatever energy it uses from sources that can be sustained over the long run.
How We Could Actually Do It, In Seven Concurrent Steps
Step one:Cap global fossil fuel extraction through global treaty, and annually lower the cap. We will not reduce carbon emissions until we reduce fossil fuel usage—it’s just that simple. Rather than trying to do this by adding renewable energy (which so far hasn’t resulted in a lessening of emissions), it makes far more sense simply to limit fossil fuel extraction. I wrote up the basics of a treaty along these lines several years ago in my book, The Oil Depletion Protocol.
Step two:Manage energy demand fairly.Reducing fossil fuel extraction presents a problem. Where will we get the energy required for transition purposes? Realistically, it can only be obtained by repurposing energy we’re currently using for non-transition purposes. That means most people, especially in highly industrialized countries, would have to use significantly less energy, both directly and also indirectly (in terms of energy embedded in products, and in services provided by society, such as road building). To accomplish this with the minimum of societal stress will require a social means of managing energy demand.
The fairest and most direct way to manage energy demand is via quota rationing. Tradable Energy Quotas (TEQs) is a system designed two decades ago by British economist David Fleming; it rewards energy savers and gently punishes energy guzzlers while ensuring that everyone gets energy they actually need. Every adult would be given an equal free entitlement of TEQs units each week. If you use less than your entitlement of units, you can sell your surplus. If you need more, you can buy them. All trading takes place at a single national price, which will rise and fall in line with demand.
Step three: Manage the public’s material expectations. Persuading people to accept using less energy will be hard, if everyone still wants to use more. Therefore, it will be necessary to manage the public’s expectations. This may sound technocratic and scary, but in fact society has already been managing the public’s expectations for over a century via advertising—which constantly delivers messages encouraging everyone to consume as much as they can. Now we need different messages to set different expectations.
What’s our objective in life? Is it to have as much stuff as possible, or to be happy and secure? Our current economic system assumes the former, and we have instituted an economic goal (constant growth) and an indicator (gross domestic product, or GDP) to help us achieve that goal. But ever-more people using ever-more stuff and energy leads to increased rates of depletion, pollution, and degradation, thereby imperiling the survival of humanity and the rest of the biosphere. In addition, the goal of happiness and security is more in line with cultural traditions and human psychology. If happiness and security are to be our goals, we should adopt indicators that help us achieve them. Instead of GDP, which simply measures the amount of money changing hands in a country annually, we should measure societal success by monitoring human well-being. The tiny country of Bhutan has been doing this for decades with its Gross National Happiness (GNH) indicator, which it has offered as a model for the rest of the world.
Step four:Aim for population decline. If population is always growing while available energy is capped, that means ever-less energy will be available per capita. Even if societies ditch GDP and adopt GNH, the prospect of continually declining energy availability will present adaptive challenges. How can energy scarcity impacts be minimized? The obvious solution: welcome population decline and plan accordingly.
Global population will start to decline sometime during this century. Fertility rates are falling worldwide, and China, Japan, Germany, and many other nations are already seeing population shrinkage. Rather than viewing this as a problem, we should see it as an opportunity. With fewer people, energy decline will be less of a burden on a per capita basis. There are also side benefits: a smaller population puts less pressure on wild nature, and often results in rising wages. We should stop pushing a pro-natalist agenda; ensure that women have the educational opportunities, social standing, security, and access to birth control to make their own childbearing choices; incentivize small families, and aim for the long-term goal of a stable global population closer to the number of people who were alive at the start of the fossil-fuel revolution (even though voluntary population shrinkage will be too slow to help us much in reaching immediate emissions reduction targets).
Step five:Target technological research and development to the transition. Today the main test of any new technology is simply its profitability. However, the transition will require new technologies to meet an entirely different set of criteria, including low-energy operation and minimization of exotic and toxic materials. Fortunately, there is already a subculture of engineers developing low-energy and intermediate technologies that could help run a right-sized circular economy.
Step six:Institute technological triage. Many of our existing technologies don’t meet these new criteria. So, during the transition, we will be letting go of familiar but ultimately destructive and unsustainable machines.
Some energy-guzzling machines—such as gasoline-powered leaf blowers—will be easy to say goodbye to. Commercial aircraft will be harder. Artificial intelligence is an energy guzzler we managed to live without until very recently; perhaps it’s best if we bid it a quick farewell. Cruise ships? Easy: downsize them, replace their engines with sails, and expect to take just one grand voyage during your lifetime. Weapons industries offer plenty of examples of machines we could live without. Of course, giving up some of our labor-saving devices will require us to learn useful skills—which could end up providing us with more exercise. For guidance along these lines, consult the rich literature of technology criticism.
Step seven:Help nature absorb excess carbon. The IPCC is right: if we’re to avert catastrophic climate change we need to capture carbon from the air and sequester it for a long time. But not with machines. Nature already removes and stores enormous amounts of carbon; we just need to help it do more (rather than reducing its carbon-capturing capabilities, which is what humanity is doing now). Reform agriculture to build soil rather than destroy it. Restore ecosystems, including grasslands, wetlands, forests, and coral reefs.
Implementing these seven steps will change everything. The result will be a world that’s less crowded, one where nature is recovering rather than retreating, and one in which people are healthier (because they’re not soaked in pollution) and happier.
Granted, this seven-step program appears politically unachievable today. But that’s largely because humanity hasn’t yet fully faced the failure of our current path of prioritizing immediate profits and comfort above long-term survival—and the consequences of that failure. Given better knowledge of where we’re currently headed, and the alternatives, what is politically impossible today could quickly become inevitable.
Social philosopher Roman Krznaric writes that profound social transformations are often tied to wars, natural disasters, or revolutions. But crisis alone is not positively transformative. There must also be ideas available for different ways to organize society, and social movements energized by those ideas. We have a crisis and (as we have just seen) some good ideas for how to do things differently. Now we need a movement.
Building a movement takes political and social organizing skills, time, and hard work. Even if you don’t have the skills for organizing, you can help the cause by learning what a real energy transition requires and then educating the people you know; by advocating for degrowth or related policies; and by reducing your own energy and materials consumption. Calculate your ecological footprint and shrink it over time, using goals and strategies, and tell your family and friends what you are doing and why.
Even with a new social movement advocating for a real energy transition, there is no guarantee that civilization will emerge from this century of unraveling in a recognizable form. But we all need to understand: this is a fight for survival in which cooperation and sacrifice are required, just as in total war. Until we feel that level of shared urgency, there will be no real energy transition, and little prospect for a desirable human future.
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A Note on Noam Chomsky and Climate Collapse
As Noam once said, “if you assume there is no hope, you guarantee there will be no hope.”
Aug 11, 2024
In many of his recent writings, Noam Chomsky has warned that humanity has reached a very dangerous point because we are now living in a world of cascading crises. Indeed, when we look around us, we see a global web of crises. Economic inequality is destabilizing democracies and making a mockery of the vision of a decent society; armed conflicts continue to mark human existence; and nuclear weapons and global warming threaten humanity’s survival. Meanwhile, we must feel aghast over the fact that cynicism and irrationality continue to define the mindset of the powers that be. This is precisely the reason why Chomsky has always seen activism as our only hope.
What’s happening in Gaza is an abomination, one that the leaders of this world are watching coldly from a distance. The same can be said about climate collapse, which is as real as the daily slaughtering of scores of innocent women and children in Gaza by Israel’s military. Our global institutions are incapable of doing anything meaningful about these crises. Real power is in the hands of the most powerful nation-states and their leaders have opted to turn a blind eye to both disasters so as not to disrupt business as usual. Profits and geostrategic interests take priority over human lives and the environment. This is as clear as day, and it has always been so since at least the emergence of capitalism and the rise of the nation-state.
The current conflict in Ukraine began on February 24, 2022, and peace remains as elusive as ever. The U.S. wants peace in Ukraine as much as Netanyahu wants to see a ceasefire deal in Gaza. The continuation of the war in Gaza is vital to the continuation of Netanyahu's political career. In fact, Netanyahu will most likely celebrate by uncorking a bottle of champagne if an all-out war exploded in the Middle East. He knows he can’t possibly lose with the U.S. backing Israel. The cost of an all-out war in terms of human lives, either Israeli or Iranian or Arab lives, is simply irrelevant to him--or to Washington. Or what another war might do to the environment. The war in Gaza is also a war on the environment; in fact, it is “a widespread and deliberate act of ecocide,” according to a study by Forensic Architecture.
Profits and geostrategic interests take priority over human lives and the environment. This is as clear as day, and it has always been so since at least the emergence of capitalism and the rise of the nation-state.
As Chomsky has pointed out, “ history is all too rich in records of horrendous wars, indescribable torture, massacres and every imaginable abuse of fundamental rights.” But the great man has gone to great lengths to stress that the climate crisis is “unique in human history” and, like nuclear weapons, can destroy organized human life as we know it. Yet, humanity spends annually trillions of dollars on weapons and the military but finds it economically unrealistic to devote the necessary funds to protect the earth.
So much for rationality.
Indeed, consider the global implications of the melting of the Antarctica sea ice. It may be winter in the Southern Hemisphere, but the Antarctica is experiencing a major heat wave that has made temperatures rise 50 degrees Fahrenheit above normal. This is the second major heat wave in Antarctica in the last two years. The entire planet has experienced more than 1.5 Celsius of warming in the 12-month period between July 2023 and June 2024, but Antarctica warms twice faster than the rest of the world, according to latest observations. If all the ice vanished, sea levels might rise by more than 150 feet.
It is no longer an issue of if but when major coastal cities will go under.
We already know that the super-rich and powerful don’t care about the rest of us, but it seems they also don’t care about the future of their own children and grandchildren. As Chomsky has underscored in some of the email exchanges that we’ve had, their self-gratification is even greater now that they know that the climate crisis is speeding toward catastrophe.
Indeed, as Copernicus Climate Change Service Director Carlo Buontempo recently said in connection with the new record set for the daily global mean temperature “we are now in truly uncharted territory…”
We already know that the super-rich and powerful don’t care about the rest of us, but it seems they also don’t care about the future of their own children and grandchildren.
And this brings us to the question of activism, which, as already pointed out, Chomsky sees as our only hope to save the planet. It’s our only way to stop carnages; our only way to stop the criminal negligence of climate collapse. We need the greatest possible degree of public mobilization for the purpose of exerting influence on policymakers. But without thoughtless methods like destroying works of art that turn the public against climate activism.
Moreover, Chomsky believes that we have the knowledge, money, and technology to transition from fossil fuels to alternative sources of energy that are clean, affordable and sustainable. This is why he feels that the Green New Deal is exactly the right idea and finds the Global Green New Deal initiative laid out by the progressive economist Robert Pollin particularly attractive.
As far as the link between capitalism and the climate crisis goes, suffice to say that Chomsky understands better than most the forces behind environmental degradation and climate collapse. The economic system of capitalism, especially during its neoliberal phase, drives climate breakdown. Global temperatures started increasing at an alarming rate after neoliberalism became the dominant economic force. Nonetheless, Chomsky is also fully aware of the fact that time is running out and we cannot wait for the end of capitalism before the planet can be saved. This is why he finds it so vital that we find ways to get the world off fossil fuels quickly and fairly. We must reach carbon neutrality no later than 2050. And do so in a just manner. For Chomsky, a just transition is imperative to building the political power that would bring about a shift from the fossil-fuel economy to a regenerative economy. Because, again, social activism is our only hope, according to what many have described as the “ world’s conscience keeper for nearly half a century.”
And, no, hope is not an option. As Noam once said, “if you assume there is no hope, you guarantee there will be no hope.”
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How to Tackle the Climate Crisis and Inequality
Carbon dividends, public investment, and binding carbon-emissions reductions to commensurate reductions of toxic air pollutants from fossil fuels are three policies that narrow inequality rather than widening it.
Aug 03, 2024
Our planet is warming up at a record rate. Scientists believe that the climate is warming up as a consequence of the increase in greenhouse gases. Studies have also shown that there is a link between climate change and inequality. Yet, the global economy continues to be overly dependent on fossil fuels—oil, natural gas, and coal—which are by far the largest contributor to global warming. What does all this say about current climate policies and the goal of achieving carbon neutrality by 2050? And how do we address the twin challenges of inequality and climate change?
In the interview that follows, progressive political economist James K. Boyce sheds light on the above questions. James K. Boyce is a senior fellow at the Political Economy Research Institute at the University of Massachusetts Amherst, and recipient of the inaugural Global Inequality Research Award. He is the author, among many other works, of The Case for Carbon Dividends and Economics for People and the Planet: Inequality in the Era of Climate Change.
C. J. Polychroniou: Over the past several years, climate records have been repeatedly broken. Last year was the planet’s hottest by a huge margin since global records began in 1850, and 2024 is on course to break that record again. Are climate policies designed to reduce greenhouse gas emissions working, especially when we have wars going on that contribute significantly to climate change? Indeed, with everything going on, which includes increased demand for oil, is it at this point even realistic to expect that we can achieve climate neutrality by 2050?
James K. Boyce: You’re right, it’s getting hotter year by year. This is no surprise: it’s exactly what we can expect until the world reaches climate neutrality (net-zero emissions of greenhouse gases). Some climate policies are working better than others—it is not as if nothing is happening. Renewable energy from solar and wind has become cost-competitive more quickly than most people expected. But we are not on track to achieve climate neutrality by 2050. To do so we would need to phase out the use of oil, natural gas, and coal. Instead, global consumption of all three fossil fuels is at an all-time high.
You are right, too, that wars exacerbate the problem. They distract attention and resources from addressing the climate crisis, and they add to greenhouse gas emissions. In just the first two months of the war in Gaza, for example, carbon emissions (mostly from Israeli warplanes and U.S. weaponry supply flights) exceeded the annual emissions of 20 countries, according to a team of U.K. researchers. Postwar reconstruction, once this latest round of bloodshed ends, is likely to release much more.
You ask whether it is “realistic” to expect that we can achieve climate neutrality by 2050? Obviously not if we continue on this path.
Each ton of carbon is more harmful than the one that came before.
Yet it is realistic to say that it is possible to achieve it. There is no technical reason it cannot be done: the obstacles are political. To do it, each country would need to set a hard ceiling on the quantity of fossil fuels entering its economy, a cap that declines year-by-year on a path to net zero. Restrictions on the supply of fossil fuels would raise their price—possibly a lot. But instead of the money going to into the bank accounts of oil producers, as happens when OPEC and oligopolistic corporations restrict their output to boost prices, the money could go directly back to the public on an equal per person basis with a cap-and-dividend system. This would maintain the real incomes of working people in the face of rising fuel prices, and it would make a modest contribution to addressing the other great challenge of our time, curbing rampant inequality.
I wish I could tell you this will happen sooner rather than later. But the political stars do not seem to be favorably aligned at this moment. That said, the climate crisis is not going to disappear. Pretending it’s not real doesn’t make it any less real. It will keep worsening unless and until we achieve climate neutrality.
Think about that: it will keep getting worse. Climate change is not like a cliff, where once we fall off the edge it is too late to do anything. Instead, it is a cascade of damages, with costs that grow exponentially over time. To proclaim that before long it will be “too late” to do anything about it would be irresponsible and misleading. Each ton of carbon is more harmful than the one that came before. Each day we delay, the need for action becomes more urgent, not less.
C. J. Polychroniou: There is a global backlash on climate action. The pushback against climate policies comes from the fossil fuel industry and major corporations, Europe’s far right, and the Republican Party in the U.S. But this wrecking-ball strategy seems, unfortunately, to be paying off as we still lack sufficient public and political will for bold climate action. Could things be different if plans to combat climate change effectively addressed environmental and social concerns? Indeed, where do things stand with regard to just transition and environmental justice?
James K. Boyce: Denial of the reality of climate change was the first line of defense of the fossil fuel lobby. But this could work for only so long. As the results of climate destabilization become ever more apparent, denial becomes ever more untenable. Of course, there are some who will cling to it. There are still people who insist the world is flat. But most people cannot be persuaded to keep their heads in the sand most of the time.
So today the industry has fallen back on its second line of defense: the claim that cost of moving away from fossil fuels would be unacceptably high, undermining the living standards of working people at home and abroad. The distinguished economist John Kenneth Galbraith anticipated this tactic more than 50 years ago. In his 1972 presidential address to the American Economics Association, he observed that in pursuit of private profits, corporations seek to persuade the public that pollution is “palatable or worth the cost.”
The claim that ordinary people must “tighten their belts” and endure sacrifices to save the planet appeals to a finger-wagging element in the environmental movement, but it is antithetical to building the broad public support we need for climate action.
It is an open question how the costs of the transition to a net-zero economy will be distributed across the population. This is a policy choice rather than a foregone conclusion. With the right policies, the clean energy transition can raise living standards for working people rather than lowering them. What is certain is that climate change, left unchecked, poses a grave threat to human well-being, above all to the well-being of working people who cannot afford to buy private shelter from the approaching storm.
The groundwork for this line of defense was prepared when oil corporations launched a concerted effort to shift the blame for the climate crisis onto consumers. It is a twist on the classic scoundrel’s stratagem of blaming the victim. Two decades ago, BP (the former British Petroleum) propagated the notion of individual “carbon footprints,” complete with a handy online calculator and then a phone app to tell you how much carbon is released when you drive to the grocery store or eat a hamburger. The underlying message was evident: Our customers are the real problem, not us. In orthodox economic theory, this ideological buck-passing has a fancy name: “consumer sovereignty.”
Environmentalists often fall into the same trap when they, too, blame consumers rather than the corporate and government power brokers who dictate the playing field for consumer choice. The claim that ordinary people must “tighten their belts” and endure sacrifices to save the planet appeals to a finger-wagging element in the environmental movement, but it is antithetical to building the broad public support we need for climate action.
Could things be different? You bet they could. Climate policy, if done right, will bring large and tangible benefits to people around the world. As with any addiction, weaning ourselves from dependence on fossil fuels will free us from the grip of pushers masquerading as benefactors. It will open the door to cheaper and more reliable sources of energy. It will end toxic air pollution from burning fossil fuels that annually causes millions of premature deaths. Because investments in energy efficiency and clean energy are more labor intensive than fossil fuel production, it also will create lots of new jobs. All this is on top of preventing further exacerbation of the climate crisis.
For this to happen, however, policies must be designed with these benefits firmly in mind. Just transition policies are needed to ensure that communities that have depended on the fossil fuel industry in the past are not only cushioned from the costs of the transition but actually gain new and better economic opportunities. Environmental justice policies are needed to ensure that communities that have experienced disproportionate costs from fossil fuel pollution are first in line to benefit from cleaner air and water. And as I already mentioned, a carbon price-and-dividend policy is needed to protect and raise the real incomes of working people even in the face of rising prices for fossil fuels as their supply is phased out.
None of these policies are impossible. But none of them will happen as long as the fossil fuel lobby and its cronies are calling the shots.
C. J. Polychroniou: You are one of the very first economists to address the political economy of the environment. Climate change seems to be deeply intertwined with global patterns of inequality. What specific measures do you propose for addressing the twin challenges of inequality and the climate crisis?
James K. Boyce: Political economy is about the allocation of scarce resources not only among competing ends—that is the textbook definition of economics—but also their allocation among competing people, competing individuals, groups, and classes. In other words, it is about who as well as what.
Reducing the inequalities within and among countries cannot be achieved with the snap of a finger. It requires action on many fronts, including taxation, trade, investment, and international finance.
Whenever we encounter environmental degradation, we can pose three questions: Who benefits? Who bears the cost? And why are those who benefit able to impose this cost on others? Inequalities of wealth and power are deeply implicated in answers to the last question. Much of the cost of climate change will fall upon future generations who are not here to defend themselves. The only way to redress this inherent power imbalance is to develop an ethic of intergenerational responsibility. But significant costs are imposed on people alive today, too. This has long been the case for frontline communities polluted by the extraction and combustion of fossil fuels. Now the costs are spreading to people everywhere who are suffering from more frequent and more intense droughts, floods, wildfires, hurricanes, and heatwaves.
The ability of those who capture the lion’s share of the benefits from fossil fuels—big corporations and rulers of petrostates—to impose enormous environmental costs on others is a symptom of stark inequalities in the distribution of wealth and power. Anything we can do to rectify this inequality will make it easier to address the climate crisis. And anything we can do to address the climate crisis will make it easier to rectify this inequality.
Reducing the inequalities within and among countries cannot be achieved with the snap of a finger. It requires action on many fronts, including taxation, trade, investment, and international finance, some of which we have discussed before.
But in the meantime, we can implement climate change policies that narrow inequality rather than widening it. Let me elaborate a little more on three of these policies.
Carbon dividends would return money to the people from putting a price on carbon emissions by means of either a tax, a cap with auctioned permits, or a combination of the two (in which the tax serves as the floor price in permit auctions, combining downside price certainty with upside emissions certainty). A carbon dividend policy is already in place in Canada. The Canadian policymakers made an initial blunder, in my view, by rebating the carbon revenue to the people via an income tax credit, rendering it practically invisible to most people. Fuel prices, on the contrary, are advertised in foot-high numbers at gasoline stations around the country. The fossil fuel lobby and its political allies have tried to paint higher fuel prices as an awful burden on working families, while ignoring the money coming back to them as dividends. To debunk these predictable efforts, carbon dividends must be as visible as the price of gasoline at the pump. Paying dividends via direct, stand-alone payments—the proverbial “check in the mail” or clearly labeled direct deposits into personal bank accounts—is crucial for this reason. The Trudeau government belatedly realized this and changed to direct payments. But whether Canada’s policy survives will depend on the outcome of the upcoming national elections.
A second climate policy that can also be a vehicle to reduce inequality is well-targeted public investment. This was a focus of the Biden administration in the United States. Public investment can be directed so as to reduce inequalities between regions and communities. Just transition investments in fossil fuel-dependent localities and environmental justice investments in the communities hardest hit by fossil fuel pollution are examples of this. More generally, investment can and should be steered to rural and urban areas that in recent decades have experienced collapsing incomes and shrinking economic opportunities.
A third way in which climate policy can reduce inequality is to bind carbon emissions reductions to commensurate reductions in emissions of toxic air pollutants from fossil fuels—sulfur dioxide, nitrogen oxides, and so on—by means of an “environmental justice guarantee.” Such a guarantee would mandate that overall reduction in carbon emissions is matched by reductions in co-pollutant emissions in communities disproportionately impacted in the past. Such a guarantee is included explicitly in the Healthy Climate and Family Security Act of 2022 introduced by U.S. Sen. Chris Van Hollen (D-Md.)
None of this will happen without popular mobilization. Democracy was not handed to us on a platter. The abolition of slavery was not delivered on a platter. Neither were women’s suffrage, civil rights, or environmental protection. Throughout history, pro-people change happens only when ordinary people demand it. That is what needs to happen now.
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