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Support for cap-and-trade depends on policy design

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Posted June 25, 2015

Public support and implementation success of regional cap-and-trade programs in the United States depends on program design, according to University of Michigan research.

Cap-and-trade programs set a maximum limit on emissions and auction allowances to emit up to those limits as a way to limit greenhouse gas emissions.

When asked how revenues generated through allowance auctions from a cap-and-trade program might be used, the National Surveys on Energy and Environment found public support was highest among both Republicans and Democrats when revenues were used to expand energy efficiency programs.

In contrast, cap-and-trade programs that used revenues for non-energy investments such as highway and bridge improvements received the most opposition.

A companion paper, just published in the journal Governance, looks at the fate of three regional cap-and-trade zones established in the U.S. and Canada in the last decade. The cap-and-trade program in the Midwest has completely disappeared and the program in the West shrank from 11 members to just two, while the cap-and-trade program in the Northeast has survived.

“This is likely a result of building strong public support among residents in the Northeast,” said Barry Rabe, U-M professor of public policy.

The Obama Administration’s creation of the Clean Power Plan to reduce greenhouse gas emissions from the electric power sector has renewed interest in possible state or regional adoption of cap-and-trade programs to meet mandatory reduction targets.

“As states consider adoption of cap-and-trade to comply with the Clean Power Plan, they may want to weigh these design options and how they might influence future public support or opposition,” Rabe said.

The survey is a joint effort of the Center for Local, State, and Urban Policy at U-M’s Gerald R. Ford School of Public Policy and the Muhlenberg Institute of Public Opinion at Muhlenberg College in Allentown, Pa.

The random telephone survey of 751 American adults was conducted in April 2015. The survey had a margin of error of 3.6 percent.

Source: University of Michigan

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