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The entanglement of climate and energy policies

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  • Peter R. Hartley

Abstract

Increased CO 2 in the atmosphere increases tropospheric temperatures, thereby changing other climate attributes. However, cutting CO 2 emissions by reducing fossil fuel use raises concerns about economic development and energy security. Additional CO 2 is also directly beneficial for plants. Adaptation measures are an alternative, but those that are public goods are unlikely to be efficiently deployed without explicit government action. A model is developed to illustrate some of these complex policy trade-offs. The analysis is simplified by focusing on CO 2 accumulation in the atmosphere as a sufficient statistic for both the external effects of CO 2 and the global transition from fossil fuels to alternative energy sources. JEL Classification: D62 Externalities; H23 Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies; O13 Economic Development: Agriculture; Natural Resources; Energy; Environment; Other Primary Products; Q32 Exhaustible Resources and Economic Development; Q42 Alternative Energy Sources; Q52 Pollution Control Adoption and Costs; Distributional Effects; Employment Effects; Q54 Climate; Natural Disasters and Their Management; Global Warming.

Suggested Citation

  • Peter R. Hartley, 2026. "The entanglement of climate and energy policies," The Energy Journal, , vol. 47(1), pages 261-286, January.
    • Handle: RePEc:sae:enejou:v:47:y:2026:i:1:p:261-286
    DOI: 10.1177/01956574251375436
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    Keywords

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    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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