A green economy, one that promotes clean energy, reduces pollutants and greenhouse gases, requires an intersection of government regulation, business and innovation in both technology and public policy. Goldman School Professor Lee Friedman, postdoctoral fellow Hanna Breetz and Professor Michael O’Hare are diving into the complexities of regulation, business innovation and investment. Their research has direct bearing on policy today and is helping to shape a greener tomorrow.
California’s Global Warming Solutions Act (AB32), aims to reduce greenhouse gas emissions to 1990 levels by 2020. It is groundbreaking and ambitious legislation that has set into motion new policy and regulatory efforts. But 2020 is less than a decade away. What happens after that?
“For green business investment, it is important for the State to be clear about what kinds of emissions reductions it is going to require in the 2021-30 period,” says Professor Lee Friedman. “People who are making large scale investments now in things like new commercial buildings, need to decide whether the money they invest in making it green will repay itself in lower bills in the future. This is tied directly to emissions goals. If CA did nothing after it achieves its 2020 emissions goals, there would be no incentive to continue to reduce emissions. If the price of emission allowances increases steadily through continued regulation, however, it incentivizes investment in green business.”