Consumption-oriented policy instruments for fostering greenhouse gas mitigation

Figures & data

Figure 1. Sectors and scope of consumption-oriented policy contrasted with traditional production focus of climate mitigation policies.

Table 1. The long list of consumption-oriented policy instruments.

Policy Instrument	Summary	Main target (R = retailer; C = consumer)
Information instruments
Product labels	Requirement of embodied and/or likely in-use energy / carbon information on labels	R, C
Approved technology lists	List of e.g. ‘efficient technologies’ approved by a public authority for sale or procurement	R, C
Graduated tax on advertising	Tax on advertising that increases with carbon content of a product or service	C
Information campaign	Information provision to potential consumers regarding carbon implications of consumption patterns	C
Product location at sale	Low carbon products are given preferential placement at retail stores, internet sites, etc.	C
Rankings and Award campaigns	Product manufacturers and/or sellers are given publicly celebrated awards for low carbon performance	R
Regulatory and Administrative instruments
Regulatory standards	Direct regulation of performance of products available at point of sale	R
Licenses	License is required either to sell or purchase high carbon products	R
Government procurement	Government gives preferential procurement to low carbon options	R
Recycling requirements	Retailer and/or consumers have responsibility for recycling product, with a ban on landfilling	R, C
Product ban	Products banned based on criterion of embodied carbon and/or likely energy/carbon (in)efficiency in use	R
Waste targets, requirements and/or prices*	Product recycling is motivated through waste policies	C
Deposits / refunds on purchased goods	Deposits are initiated to enhance recycling of goods to reduce raw materials requirements	C
Limits on ownership or use	Restrictions on the number of a given product (such as cars) that can be purchased and/or owned.	C
Sector trade body standards	Voluntary product performance standards set by trade organizations	R
Business emission agreements / allowances*	Businesses (e.g. retail) have goal for emissions; mandatory variant requires legal allowances, with trading	R
Supply chain procurement requirements	Retailers establish embodied carbon requirements on intermediate producers	R
Voluntary agreements by trade organizations	Trade organizations adopt voluntary commitments to reduce embodied and/or in-use CO2	R
Extension of product lifetime	Restrictions on the practice of planned obsolescence, or requirements of product lifespan	C
Shop product choice	Point of sale operators voluntarily restrict products to lower embodied and/or more energy/carbon efficient models	R
Economic instruments
Carbon-intensive materials charge	Duty attached to product on grounds of typically high energy/carbon intensity (e.g. through benchmark)	R, C
Carbon embodied charge	Charge levied on basis of actual emissions in making and delivering the product	C
Product user fees	A fee is attached at point of sale based on carbon associated with subsequent use	C
Waste and recycling – financial*	See Administrative
Minimum price limits	Very low prices are banned to remove from markets products that have less incorporation of externalities	R, C
Business emission allowances*	See SM and note 10
Subsidy	Government or trade subsidy of low carbon products	R, C
Product tax incentives	e.g. Enhanced tax depreciation based on product performance / embodied carbon	R
Trade Environmental Goods and Services agreements – e.g. tariffs	Proposal for tariff reductions on EGS products	R
Preferential finance terms	Lower interest rates for low carbon investments (e.g. energy efficiency improvements in buildings)	C
Enabling instruments
Mandatory metering	Requirement of metering for power and gas use in buildings to signal energy consumption	C
Infrastructure improvements	Improvements to infrastructure that enable low carbon options (e.g. public transport)	C
Enabling recycling	Creation of the infrastructure for recycling of goods between consumers	C
Enabling product sharing	Creating infrastructure for shared ownership and/or use of products (e.g. Zipcar)	C

*These policy instruments may be applied in different forms and may therefore appear in more than one category

Table 2. Policy instrument scoring aggregation.

Table 3. Potential significance of consumption-oriented policy instruments by compound rank, key sectors and limiting criteria.

Policy instrument	Key sectors	Lower criteria scores*
First Rank (compound score > 50)
Approved technology lists	All score 54 except food, heat & electricity sourcing (36)	Scope; International political
Supply chain procurement	All score 54 except food, heat & electricity sourcing (36)	Scope; International political
Carbon-intensive materials charge	Building fabric / consumer goods & machinery / paper & plastics / vehicles	Effectiveness; EU Admin & Implementation
Infrastructure improvement	Transport vehicles & fuels / building fabrics	Scope; distributional
Retailers product choice	Food / buildings fabric / consumer goods & machinery / textiles	Scope & effectiveness
Product location at sale	Food & textiles	Scope & effectiveness
Second Rank (compound score 31–50)
Regulatory Standards	Buildings fabric / consumer goods & machinery	Legal; International political
Business emission agreements or allowances	Buildings / paper & plastics / consumer goods & machinery	Scope & Effectiveness; EU Admin & Implementation
Environmental Goods and Services (Trade) Agreements	Building fabric / consumer goods & machinery / paper & plastics / vehicles	Scope & Effectiveness; EU Admin & Implementation
Recycling requirements & waste targets / prices	Buildings fabric / paper & plastics / consumer goods & machinery	Scope & Effectiveness; EU Admin & Implementation
Voluntary agreements by trade associations	Vehicles incl. fuels / consumer goods & machinery	Effectiveness (1)
Third Rank (compound score 20–30)
Government procurement	All sectors	Legal; International political
Information Campaigns	Building fabric / consumer goods & machinery / paper & plastics / vehicles	Scope & Effectiveness; EU Admin & Implementation
Ranking and award campaigns	Buildings fabric / paper & plastics / consumer goods & machinery	Scope & Effectiveness; EU Admin & Implementation
Sector trade body standards & voluntary agreements	Vehicles/ fuels/ consumer goods & machinery	Effectiveness (1);
Minimum price limits	Buildings fabric/ paper & plastics / consumer goods & machinery /	Scope & Effectiveness; EU Admin & Implementation
Product user fees	Buildings fabric / consumer goods & machinery /	Key sectors in Scope (1); distribution and flexibility (1)
Deposit / refunds	Textiles / consumer goods & machinery / maybe vehicles & food	Scope (1) across all sectors
Preferential finance terms	Vehicles / consumer goods and machinery	Distribution & flexibility (1) in direct consumption (food, elec. & gas) & effectiveness (1) for paper &plastics, textiles
Enabling product sharing	Vehicles	Effectiveness (1) for all sectors outside transport; also distributional concerns in direct consumption

Notes: Bold indicates that ranking is robust against a sensitivity study of reduced weights on feasibility criteria.

Italic Indicates where design choices could enhance effectiveness (eg mandatory forms of business emission allowances, as note 10)

*‘(1)’ indicates this criterion was scored 1 indicating a low potential impact or feasibility on this criterion.

Table 4. Scores by sector averaged across all instruments.

	Transport		Food	Buildings			Paper & plastics	Textiles	Consumer goods & machinery
	Vehicles	Fuels		Fabric	Heat	Elec
Average score by sector	25	17	15	30	11	11	20	20	29

Table

Table

Table

Table