The “Paris Gap,” and How to Fix It

Wednesday, January 25, 2017

The Paris Agreement on climate change is a world-shattering event, a rare coming together of the international community to face a shared threat. Former President Obama deserves a lot of credit for the success of the two-week conclave, because of his earlier diplomacy with China and executive actions to reduce emissions, and Secretary of State John Kerry also deserves kudos for staying on site in Paris to see the agreement to its conclusion. Praise also belongs to the conference organizers, staff, and leaders, not to mention the hundreds of delegates.

But the sad fact is that even if all nations meet their international obligations as pledged, the planet is on a trajectory where the increase in temperature over pre-industrial levels could total 3.5 degrees Celsius — a whopping 6 degrees Fahrenheit, an amount that is inconceivable and which would threaten civilization. The Paris Agreement, meanwhile, has a goal of 2 degrees Celsius, and an aspirational target of 1.5 degrees Celsius. Those goals stand at the limit scientists have placed after which catastrophic conditions will obtain for much of the world.

When it comes to gaps between the aspirational and the realistic, nobody knows the score better than Michael P. Vandenbergh of Vanderbilt Law School, a former partner in the Latham & Watkins law firm. He’s been writing about the “behavioral wedge” representing the space on a graph between what households do to reduce their carbon footprint and what they could do with proper public policy spurs or private initiatives.

In a recent law review article coauthored with Jonathan M. Gilligan titled “Beyond Gridlock,” the writers identify a similar gap between what is necessary to fight off the worst effects of climate change and what current governmental policy would achieve given the policy paralysis that has gripped Washington for the last several years.

The authors call for a raft of private initiatives which together would supply as much as a quarter of the emissions reductions necessary to buy the world a decade in which it can deploy much larger governmental initiatives needed to close the gap. The authors thus call the use of private governance aimed at climate change a “second best” method, behind much more comprehensive governmental actions such as a carbon tax or a cap-and-trade system.

Global Warming

When I emailed Vandenbergh after the Paris talks closed, he named a “Paris Gap,” between the aspirational and the likely, and reiterated the need for private initiatives. “In my view, the Paris Agreement was a success because it found a common ground among roughly 195 countries, including the major developing countries,” he said. “The agreement sends important signals in the marketplace that a low-carbon economy is in the future, but it also sends an unintended market signal: It clarifies the extent of the emissions reductions that are likely to occur for the next decade, and those are inadequate.”

The Paris Agreement “not only represents reason for hope that the international process will yield genuine emissions reductions, but it also makes it clear that the international process will not produce the reductions over the next decade that are necessary to achieve the goals or aspirations articulated in that agreement,” he said. “It is time to ramp up efforts to identify gap-filling initiatives if we want to reduce the risks of catastrophic climate change.”

As an example, the authors wrote in the law review article, “inefficient energy use provides an opportunity for private initiatives to target actions that do not require altruistic motivations. Instead, these initiatives can target actions for which market failures or behavioral obstacles are blocking self-interested actions, and when self-interest aligns with energy efficiency or conservation, behavioral plasticity can be high even without government intervention.” As a rather vivid example, one food firm saved 9,200 tons of carbon just by changing the way it bought potatoes. Vandenbergh and Gilligan identify a myriad of success stories and possibilities for further carbon reductions that can fill the wedge-shaped emissions gap.

In the email, Vandenbergh added, “These initiatives include investor and lender pressure on corporations, NGO-corporate supply chain efforts, internal corporate carbon goals and carbon prices, and NGO-driven initiatives to bypass utilities to reduce household energy use.”

But the situation is getting desperate, and the Paris cutbacks won’t begin for five years, a delay that will be costly for the ecosystem. “It is time to increase the focus on how much private governance can contribute on its own, not just as a means of pushing governments,” Vandenbergh said in the email.

Solving the problem of climate change will require an “all in” philosophy. Not only do we need strong governmental action, but we need an array of private initiatives too. Neither alone is enough.