Asymmetric impacts of climate policy uncertainty, investor sentiment on energy prices and renewable energy consumption: Evidence from NARDL and wavelet coherence.

This paper seeks to look into the asymmetric impacts posed by climate policy uncertainty (CPU) and investor sentiment (IS) upon the price of non-renewable energy, specifically natural gas prices, and the consumption of renewable energy, embodied in geothermal energy, biofuels, and fuel ethanol. To this end, the analysis draws on a non-linear autoregressive distributed lag (NARDL) model and wavelet coherence (WTC) technique with monthly data from January 2000 to December 2021. The NARDL results establish an asymmetric association between the variables, where negative shocks to CPU exert a greater effect on each energy variable than positive shocks, while the reverse is true for IS. Furthermore, it has been noticed that CPU and IS exhibit primarily negative correlations with the target variables over the long term, with CPU having a more pronounced effect on natural gas prices than on other forms of renewable energy consumption. Wavelet analysis also reveals that CPU leads the energy variables over the medium to long run, while IS assumes a dominant role in the short to medium run. These momentous findings underscore the importance of this study in informing energy policy formulation and environmental management, as well as optimizing investor portfolios.

Will Hydrogen Be a New Natural Gas? Hydrogen Integration in Natural Gas Grids.

Hydrogen is similar to natural gas in terms of its physical and chemical properties but does not release carbon dioxide when burnt. This makes hydrogen an energy carrier of great importance in climate policy, especially as an enabler of increasing integration of volatile renewable energy, progressive electrification, and effective emission reductions in the hard-to-decarbonize sectors. Leaving aside the problems of transporting hydrogen as a liquid, technological challenges along the entire supply chain can be considered as solved in principle, as shown in the experimental findings of the Hydrogen Innovation Program of the German Technical and Scientific Association for Gas and Water. By scaling up production and end-use capacities and, most importantly, producing hydrogen in regions with abundant renewable energy, hydrogen and its applications can displace natural gas at affordable prices in the medium term. However, this substitution will take place at different rates in different regions and with different levels of added value, all of which must be understood for hydrogen uptake to be successful.

Impact of Climate Policy Uncertainty (CPU) and global Energy Uncertainty (EU) news on U.S. sectors: The moderating role of CPU on the EU and U.S. sectoral stock nexus.

This article accounts for the impact of positive and negative shocks of the news-related Climate Policy Uncertainty (CPU) and the novel Economist Intelligence Unit's report-based global Energy Uncertainty (EU) on the U.S. sectoral stock returns by using the ARDL and NARDL approaches with dynamic multiplier simulations. We also utilize both the DCC-GARCH and ADCC-GARCH approaches to extract the symmetric and asymmetric dynamic conditional correlations between the EU and the U.S. sectoral stock returns and then regress these conditional correlation series on the CPU through series of quantile regressions. Overall, the findings suggest that only the positive CPU shocks negatively impact the U.S. sectoral stock returns of Consumer Services, Financials, Industries, Telecommunication and Utilities in the long-term, whereas the negative CPU shocks insignificantly predict the U.S. sectoral returns. The findings also report that only the negative EU shocks increase the U.S. sectoral stock returns of Consumer Services, Financials, Health Care, Industries, Moreover, the positive (negative) EU shocks cause the U.S. sectoral returns of Materials and Technology to decrease (increase) in the long-term. Portfolio managers may consider diversifying their portfolios to include sectors least susceptible to negative impacts from the CPU and EU shocks such as Health Care and Oil & Gas. Our findings also show that CPU shocks moderate the dynamic conditional correlations between the EU and the U.S. sectoral returns of Consumer Services, Materials, Health Care, Telecommunication, Oil and Gas and Utility. Fund managers should contemplate augmenting the allocations to the Financials, Industrials, and Technology sectors owing to their diminished interconnectivity with the EU during periods of heightened CPU.

Does climate policy uncertainty drive the extreme spillovers of carbon-energy-shipping markets?

In addressing the ramifications of climate change, the shipping industry, reliant on energy, has been integrated into the Emissions Trading System (ETS). This study utilizes the quantile connectedness model to investigate the information spillover mechanisms and extreme time-varying interconnections among carbon, energy, and shipping markets. Whether climate policy uncertainty drives the extreme interconnections is also discussed during both pre- and post-Paris Agreement periods, by using GARCH-MIDAS model. The empirical findings underscore the following key points: (i) the systemic connectedness is highly sensitive to market conditions and major events, increasing significantly under extreme market conditions; (ii) following the implementation of the Paris Agreement, an elevated level of informational interdependence has manifested between the carbon market and the energy and shipping sectors; (iii) the information transfer mechanism between carbon and shipping sectors creates direct and indirect spillover paths, with crude oil market mediating the indirect path; (iv) climate policy uncertainty greatly affects the extreme time-varying interconnections, and this impact has decreased after the Paris Agreement came into effect. These results offer valuable insights for market policymakers and shipping companies in achieving a balance between carbon emission reduction and shipping business, particularly amidst heightened climate policy uncertainty.

The impact of climate policy uncertainty on China's green energy and non-ferrous metals market co-movement: Evidence from spillover perspectives.

The rapid development of green energy would render a profound impact on the non-ferrous metals markets in China. This paper adopts the quantile vector autoregression (QVAR) to investigate the spillover effects between China's green energy and non-ferrous metals markets as well as their dynamic pattern under normal and extreme conditions. Furthermore, GARCH-MIDAS model and quantile regression method are applied to examine the impact of China's climate policy uncertainty on the spillovers between the two markets. In doing so, we find that green energy markets mainly act as transmitters of return spillover effects to non-ferrous metals markets during normal market times and periods of downturns. However, in upturns, the non-ferrous metals markets would easily transit spillover effects to green energy ones. It is further indicated that China's climate policy uncertainty exacerbates the spillover effect, and the exacerbated effect of high uncertainty on the market relationship when the spillover effect is at high level is the most significant.

California dreaming: Why environmental justice is integral to the success of climate change policy.

In the realm of climate policy, issues of environmental justice (EJ) are often treated as second-order affairs compared to overarching sustainability goals. We argue that EJ is in fact critical to successfully addressing our national and global climate challenges; indeed, centering equity amplifies the voices of the diverse constituencies most impacted by climate change and that are needed to build successful coalitions that shape and advance climate change policy. We illustrate this perspective by highlighting the experience of California and the contentious processes by which EJ became integrated into the state's climate action efforts. We examine the achievements and shortcomings of California's commitment to climate justice and discuss how lessons from the Golden State are influencing the evolution of current federal climate change policy.

The impact of climate policy uncertainty on corporate pollution Emissions--Evidence from China.

Climate change is considered one of the major systemic risks facing the world in the 21st century. To address climate change, China has adopted a series of climate policies, but the uncertainty brought about by frequent climate policy issuance has increased pressure on enterprises, which may not be conducive to enterprises reducing emissions. This paper uses data on 1211 listed companies on the A-share market in China from 2012 to 2022 to study the impact of climate policy uncertainty on enterprise pollutant emissions. The research findings show that climate policy uncertainty increases corporate pollution emissions; climate policy uncertainty mainly generates negative impacts on enterprise environmental regulation, social responsibility, and R&D investment, thereby negatively affecting enterprise emissions reduction. Further heterogeneity analysis shows that climate policy uncertainty in China has a more significant impact on non-state-owned enterprises, technology-intensive enterprises, lightly polluting enterprises, and enterprises in western regions. These findings emphasize the importance of enterprise social responsibility, environmental regulation, and R&D investment in enterprise emissions reduction and provide policy implications for Chinese enterprises to optimize their energy-saving and emission reduction strategies in the face of climate policy uncertainty.

The essential role of climate policy uncertainty in carbon emissions: a fresh insight.

This study assesses the influence of climate policy uncertainty (CPU) on carbon emissions (CE) against the backdrop of economic policy uncertainty (EPU) in the US. The wavelet analysis provides a comprehensive understanding of correlations in the time and frequency domains. The results demonstrate a significant correlation between CPU and CE, which varies across different time periods and frequencies. In the time domain, the results indicate that the CPU and CE move together during certain subperiods. Moreover, there are observable comovements in the frequency domain, particularly in the short to medium range. However, the correlation becomes stronger in the short term when there is no EPU, suggesting a closer interaction between CPU and CE. Therefore, it is crucial for governments to prioritize improving the clarity, credibility, and consistency of climate policies. They should also consider potential economic shocks when designing these policies.

Financial regulations and sustainability: The role of energy price and climate policy uncertainty.

Russia ranks among the top five countries worldwide in terms of carbon emissions, with the energy, transportation, and manufacturing sectors as the major contributors. This poses a significant threat to both current and future generations. Russia faces challenges in achieving Sustainable Development Goal 13, necessitating the implementation of more innovative policies to promote environmental sustainability. Considering this alarming situation, this study investigates the role of financial regulations, energy price uncertainty, and climate policy uncertainty in reshaping sectoral CO2 emissions in Russia. This study utilizes a time-varying bootstrap rolling-window causality (BRW) approach using quarterly data from 1990 to 2021. The stability test for parameters indicates instability, suggesting that the full sample causality test may yield incorrect inferences. Thus, the BRW approach is employed for valid inferences. Our findings confirm the time-varying negative impact of financial regulations on CO2 emissions from energy, manufacturing, and transportation sectors. Additionally, findings confirm time-varying positive impact of energy prices and climate policy uncertainty on CO2 emissions from the energy, manufacturing, and transportation sectors. Strong financial regulations and stable energy and climate policies are crucial for achieving sustainability, highlighting significant policy implications for policymakers and stakeholders.

The risk paradox: Exploring asymmetric nexus between climate policy uncertainty and renewable energy technology budgets.

The ups and downs of climate policy uncertainty (CPU) cast a captivating shadow over the budgets allocated to renewable energy (RE) technologies, where strategic choices and risk assessment will determine the course of our green environmental revolution. The main intention of this investigation is to scrutinize the effect of CPU on the RE technology budgets (RETBs) in the top 10 countries with the highest RE research and development budgets (the USA, China, South Korea, India, Germany, the United Kingdom, France, Japan, Australia, and Italy). Although former researchers have typically employed panel data tools to contemplate the connection between CPU and RE technology, they repeatedly ignored variations in this connection throughout different economies. In contrast, our research adopts a unique approach, "quantile-on-quantile," to check this association at the country-to-country level. This approach offers a comprehensive worldwide perspective while procuring tailor-made perceptions for individual economies. The outcomes suggest that CPU significantly decreases RETBs across several data quantiles in our sample nations. In addition, the outcomes underscore that the connections between our variables differ among nations. These outcomes highlight the significance of policymakers implementing thorough appraisals and skillfully governing plans relevant to CPU and RETBs.

Inaction in Urban Climate Policy Undermines Health.

This paper investigates the critical intersection of urban climate policy and public health, emphasizing the pressing need for integrated strategies to address the intertwined challenges of climate change and health in urban settings. Despite cities being central to global emissions and energy consumption, a significant gap exists in the incorporation of health considerations into urban climate strategies, as evidenced by the analysis of urban content in Nationally Determined Contributions (NDCs). The paper highlights the Coalition for High Ambition Multilevel Partnerships (CHAMP) initiative and the forthcoming Intergovernmental Panel on Climate Change (IPCC) Special Report as pivotal moments for integrating climate and health agendas. However, it also points out the underwhelming response from cities in adopting comprehensive climate strategies, which undermines potential public health benefits. With substantial investments required to bridge the gap in health-focused climate resilience, the paper calls for a redefined approach to urban climate policy. This approach should prioritize health outcomes, leverage opportunities like the 15-Minute City concept, and foster the development of infrastructures that support both climate resilience and public health. The upcoming NDC revision cycle is identified as a critical opportunity for embedding health imperatives into urban climate strategies, emphasizing the need for a holistic perspective that views urban areas as ecosystems where climate and health are intricately connected. This comprehensive view aims to promote policies that are mutually reinforcing, thus contributing to healthier, more livable cities.

Least-cost decarbonization pathways for electricity generation in Finland: A convex quantile regression approach.

This study investigates the least-cost decarbonization pathways in the Finnish electricity generation industry in order to achieve the national carbon neutrality goal by 2035. Various abatement measures, such as downscaling production, capital investment, and increasing labor and intermediate inputs, are considered. The marginal abatement costs (MACs) of greenhouse gas emissions are estimated using the convex quantile regression method and applied to unique register-based firm-level greenhouse gas emission data merged with financial statement data. We adjust the MAC estimates for the sample selection bias caused by zero-emission firms by applying the two-stage Heckman correction. Our empirical findings reveal that the median MAC ranges from 0.1 to 3.5 euros per tonne of CO2 equivalent. The projected economic cost of a 90% reduction in emissions is 62 million euros, while the estimated cost of achieving zero emissions is 83 million euros.

Intergenerational altruism and climate policy preferences.

Climate mitigation constitutes an intergenerational moral dilemma; the decisions we make today will inevitably shape the prospects for generations to come. Yet, we still know little about the relationship between intergenerational altruism (IGA)-our concerns for the well-being of future generations-and support for costly climate mitigation policies. In this study, we present an approach to measuring IGA through an intergenerational dilemma, where participants allocate resources across generations. First, we describe how IGA depends on the temporal (social) distance between generations and demonstrate robust correlations between IGA and support for several climate policies. Then, we leverage randomized participation in the intergenerational dilemma to show that it causally increases climate policy support, an effect we attribute to higher worries about human-induced climate change among treated subjects. An exploratory heterogeneity analysis suggests that the impact of the intergenerational dilemma is primarily driven by female and nonbinary participants. In sum, this study presents both a novel measurement strategy and robust evidence of a malleable moral basis of climate policy preferences.

Assessing the distribution of employment vulnerability to the energy transition using employment carbon footprints.

As the world moves away from fossil fuels, there is growing recognition of the need for a just transition of those working in carbon-intensive industries and for policy to support this transition. While recent policies such as the U.S. Inflation Reduction Act (IRA) have begun to incorporate support for energy-intensive regions, little work has thoroughly investigated which communities are most vulnerable to economic disruption in the energy transition and therefore require policy support. This paper analyzes the distribution of employment vulnerability in the U.S. by calculating the average "employment carbon footprint" of close-to every job in the U.S. economy at high geographic and sectoral granularity. The measure considers employment vulnerability across the entire economy and captures both fossil fuel consumption and production effects, with the sectors covered in our analysis accounting for 86% of total U.S. employment and 94% of U.S. carbon emissions outside of the transportation sector. We find that existing efforts to identify at-risk communities both in the literature and the IRA exclude regions of high employment vulnerability, and thereby risk leaving these communities behind in the energy transition. This work underscores the importance of proactive and continuous measures of employment vulnerability, presents policymakers with much-needed data to incorporate such measures into just transition policy and makes the case for place-based policy approaches when considering how best to support communities through the energy transition.

China's anthropogenic N2O emissions with analysis of economic costs and social benefits from reductions in 2022.

We assess China's overall anthropogenic N2O emissions via the official guidebook published by Chinese government. Results show that China's overall anthropogenic N2O emissions in 2022 were around 1593.1 (1508.7-1680.7) GgN, about 47.0 %, 27.0 %, 13.4 %, 4.9 %, and 7.7 % of which were caused by agriculture, industry, energy utilization, wastewater, and indirect sources, respectively. Maximum reduction rate for N2O emissions from agriculture, industry, energy utilization, wastewater, and indirect sources can achieve 69 %, 99 %, 79 %, 86 %, and 48 %, respectively, in 2022. However, given current global scenarios with a rapidly changing population and geopolitical and energy tension, the emission reduction may not be fully fulfilled. Without compromising yields, China's theoretical minimum anthropogenic N2O emissions would be 600.6 (568.8-633.6) GgN. In terms of the economic costs for reducing one kg of N2O-N emissions, the price ranged from €12.9 to €81.1 for agriculture, from €0.08 to €0.16 for industry, and from €104.8 to €1571.5 for energy utilization. We acknowledge the emission reduction rates may not be completely realistic for large-scale application in China. The social benefits gained from reducing one kg of N2O-N emissions in China was about €5.2, indicating anthropogenic N2O emissions caused a loss 0.03 % of China's GDP, but only justifying reduction in industrial N2O emissions from the economic perspective. We perceive that the present monetized values will be trustworthy for at least three to five years, but later the numerical monetized values need to be considered in inflation and other currency-dependent conditions.

Size of government and willingness-to-pay for environmental policy: Evidence from a cross-country survey.

Citizen support is an important precursor to climate change mitigation polices. Public opinion can shape public policy and vice versa. This paper uses the 2010 International Social Survey Programme (ISSP) Environment Module to investigate cross-national differences in support for climate policy. We introduce size of government, measured by government revenues as a share of GDP, as a new country-level factor. Our sample includes 31,511 responses from 33 countries. We use multilevel models to estimate the relationship between country-level factors and environmental policy support, conditional on a series of individual factors. Increasing the size of government by one standard deviation reduces support for environmental policy by 0.13 points on a 5-point scale. For comparison, a one standard deviation increase in GDP per capita leads to a 0.24 increase in support and a one standard deviation increase in air pollution leads to a 0.13 point increase. The implication for environmental policy is that high tax countries have an aversion to price and tax increases aimed at protecting the environment. We conclude that use of taxes for environmental policy must include clear expectations for how revenues will be recycled or how other taxes will be lowered if they are to gain widespread support.

Quantile connectedness between the climate policy and economic uncertainty: Evidence from the G7 countries.

In this study, we investigate the transmission mechanism between climate policy uncertainty (CPU) and economic policy uncertainty (EPU) in the G7 countries. To account for different conditions, we use a quantile-based VAR (Q-VAR) model over the period between 2000 and 2021. Our results show high connectedness between the CPU and the EPU of G7 countries, particularly at extreme quantile orders. On the other hand, the spillover effects between climate and economic policy uncertainty differ depending on the distributional levels of the uncertainty indices. The CPU is a net receiver of uncertainty shocks, while for almost all countries, the EPU acts as a net receiver or emitter, depending on the economic situation. During times of high or low economic uncertainty, the EPU of all G7 countries is strongly affected by shocks originating from the CPU. Moreover, the results indicate that the dynamic spillover patterns between EPU and CPU vary over time, responding to different economic events and financial crises. These results call for policymakers and governments to urgently integrate climate considerations into economic planning, fiscal policies, and regulatory frameworks to promote sustainable economic growth and mitigate the impacts of climate change.

Net-zero aviation: Transition barriers and radical climate policy design implications.

While air transport decarbonization is theoretically feasible, less attention has been paid to the complexity incurred in various 'transition barriers' that act as roadblocks to net-zero goals. A total of 40 barriers related to mitigation, management, technology and fuel transition, finance, and governance are identified. As these make decarbonization uncertain, the paper analyzes air transport system's growth, revenue, and profitability. Over the period 1978-2022, global aviation has generated marginal profits of US$20200.94 per passenger, or US$202082 billion in total. Low profitability makes it unlikely that the sector can finance the fuel transition cost, at US$0.5-2.1 trillion (Dray et al. 2022). Four radical policy scenarios for air transport futures are developed. All are characterized by "limitations", such as CO2 taxes, a carbon budget, alternative fuel obligations, or available capacity. Scenario runs suggest that all policy scenarios will more reliably lead to net-zero than the continued volume growth model pursued by airlines.

Is conservative opposition to climate change threat-based? Articulating an integrated threat model of climate change attitudes.

Throughout the literature, there are assertions that those endorsing conservative ideologies reject the science and solutions of climate change due to perceived threat. That is, they fear that accepting climate change means accepting problems with a favoured socioeconomic system and supporting action on climate change threatens to disrupt these systems. We draw together lines of research and reasoning on this topic to outline three key predictions this perspective makes about the drivers of conservative denial of climate change and opposition to climate policy. The first is that an asymmetry exists in climate-related threat perceptions, whereby greater endorsement of conservative ideology predicts lower perceived threat from climate change and greater perceived threat from climate reform. Second, climate-related threat perceptions are multifaceted, such that threats to economic and cultural well-being can be experienced, at personal or collective levels. Third, the asymmetry in threat perceptions explains conservatives' lower support for pro-climate reforms. We then specify a new integrated threat model of climate change attitudes, review the current evidence for and against each prediction in this model and outline ways to interrogate these theoretical predictions with empirical research. Doing so will advance understanding of the underpinnings of ideological disagreement on climate change.

Indigenous Peoples' rights in national climate governance: An analysis of Nationally Determined Contributions (NDCs).

Although the recognition of Indigenous Peoples' contributions to climate governance by the international community has gradually increased, a rights-based approach in national climate action is still largely absent. This article analyses the recognition of Indigenous Peoples' rights in Nationally Determined Contributions (NDCs) under the Paris Agreement. We conducted a content analysis of all NDCs submitted between 2016 and May 2022. Through a five-pronged framework of sustainable self-determination, we assessed how the NDCs recognise: i. Indigenous Peoples as rights-holders; ii. Indigenous jurisdiction over land; iii. Indigenous knowledge systems; iv. Indigenous Peoples' right to full and effective participation in climate governance; and v. the legacy of colonialism. NDCs with references related to Indigenous Peoples are increasing. However, questions remain regarding their sincerity and commitment to implementation. States must therefore make more significant efforts to ensure that the NDCs take a rights-based approach and contribute to strengthening Indigenous Peoples' role and say in climate governance.