News and Outreach: Valerie Karplus

An article published this week on the University of Nottingham Climate Policy Institute Blog: "China: Local incentives drive action on global climate change".

You can find the full article by following the link below:
http://blogs.nottingham.ac.uk/chinapolicyinstitute/2014/09/18/china-loc…;   

Written by Da Zhang, Valerie J. Karplus and Zhang Xiliang.

As countries ponder post-2020 action to halt global climate change, China has emerged as a more determined and prepared contributor. Why? The need to address climate change is closely linked to urgent domestic priorities such as cleaning up the air and steering the economy toward a path of sustainable growth. Environmental action is no longer a luxury but an imperative for China’s citizens and policymakers, who recently declared war on the haze and smog they frequently wake up to. And because the severe air pollution problem and climate change share some common roots—burning coal and other fossil fuels—carefully planned countermeasures will address both. Recent policies enacted to address air quality combined with anticipated market-based approaches for enforcing future caps on emissions and pollution will deliver cuts in GHG emissions that could enable China to take a more ambitious position in post-2020 climate talks.

China’s leaders already take their international commitments on climate change very seriously. The country is on track to meet its Copenhagen commitment to reduce the carbon intensity (CO2 emission divided by GDP) by 40–45% in 2020, relative to 2005 levels. The carbon intensity reduction over the Eleventh Five-Year Plan (2005–2010) was 21%, and the 17% reduction targeted during the Twelfth Five-Year Plan (2011–2015) is considered achievable. A 16% reduction for the Thirteenth Five-Year Plan (2016–2020) will guarantee that China hits the higher end of its original commitment. However, post-2020 there are still huge uncertainties related to China’s future growth, technological improvement, and most importantly, policy stringency that will influence the shape of China’s emissions trajectory.

In recent research, we take a closer look at the impact of existing and proposed policy measures on China’s future emissions trajectory. These measures include carbon pricing through an emissions trading system, a fossil fuel resource tax, a feed-in-tariff (FIT) for renewable electricity, hydro and nuclear capacity expansion according to government plans, and additional policies included in the National Air Pollution Action Plan (e.g. reducing the share of coal in primary energy below 65% by 2017 by implementing higher resource taxes or caps on coal use). We design two scenarios — Continued Effort (CE) and Accelerated Effort (AE) representing the existing policies and more aggressive efforts respectively and simulate them using an energy-economic modeling tool we developed to study the impacts of energy and climate policy in China. We find that China’s emissions will peak around 2040 with current effort (CE scenario) and around 2030 with strong action (AE scenario). Coal use peaks earlier than CO2 around 2020 and declines very gradually through 2050 in both policy scenarios. Of all the policies included in the package, the carbon price does the heavy lifting—and because coal is the main fuel displaced the carbon price has huge co-benefits in terms of air quality improvement. The economic impact of these policies constitutes less than 1% of total consumption in 2030, which is both very modest and in line with broader efforts to transition to slower, more sustainable economic growth. Our results suggest that introducing a national cap and price on emissions starting with the Thirteenth Five-Year Plan (2016–2020) offers an opportunity for China to transition to a cleaner growth path in line with domestic and global environmental policy goals.

China is currently laying the foundation for such an approach known as an emissions trading system (ETS). The government is considering an ETS in order to minimize the costs of reducing carbon emissions while treating of equity issues through the initial allocation of emissions allowances. By mid-2014, all seven planned pilot-scale ETS programs had been launched in several provinces and cities, and five of them have already completed the compliance cycle for the first year, which has been viewed overall as smooth and successful. As the world second largest ETS after EU-ETS, these ETS pilots offer important lessons for the future expansion of the system to a full-fledged national scale. The ETS pilot designs are as varied as the seven areas they cover. Tailored to the circumstances of the pilot area, the designs include different demographics, priorities and industries. Chinese policy makers believe this process of experimentation will allow the local communities to tailor the ETS to meet their diverse needs as heterogeneity within Chinese provinces is even more significant than that among the member states involved in EU-ETS. A remaining question is how these diverse designs can be linked and coordinated under a national ETS.

Compared to the decade or so required for the development of the EU-ETS, Chinese plans to build a national ETS by 2020 that covers most polluting sectors are ambitious. Better coordination between central and provincial governments as well as among the multiple agencies that are involved in energy and climate policy making is needed to help identify interactions between policies and avoid redundancies. There is also a strong need to develop legislation that sets penalties for exceeding CO2 limits and enhances the transparency and independent reporting of carbon emissions. Capacity building at the local and national levels to train agencies to monitor, report and verify data will also benefit from more time to observe outcomes and incorporate lessons from existing ETS.

Looking ahead to the Paris conference next year, it is fair to expect a more determined and prepared China to take a more active role. However, we should not expect to see any miracles—China is still a developing country and any pledges to reduce emissions will be underpinned by—and not at odds with—its domestic agenda. The country still has a long way to go. Overseas support for technology transfer, knowledge sharing, and personnel training—especially as it relates to the construction and operation of an effective national ETS—will be crucial to build strong institutions that can support a low carbon transition within China’s economy without undermining economic growth. China’s readiness to consider emissions limits and market-based approaches to enforcing them should be both welcomed and supported by the global community.

Da Zhang is a postdoc in the MIT Joint Program on the Science and Policy of Global Change; Valerie J. Karplus is an Assistant Professor at the MIT Sloan School of Management; Zhang Xiliang is a Professor at the Institute of Energy, Environment and Economy in Tsinghua University.

Evan Lehman
E&E reporter

It turns out that cap and trade might not be so bad after all.

New research shows that reducing carbon emissions through regulations like the administration's recent rules on power plants cuts less carbon at a higher price than the embattled climate policy Congress failed to pass in 2010. Cap and trade, or an equivalent carbon tax, would be economically easier on families, fairer to lower-income people and more flexible for emitters, according to a study by the Massachusetts Institute of Technology.

The study does not specifically examine U.S. EPA's newly proposed carbon rules, but it aims at the ballpark of all proposed rules. As such, it looks at regulatory options to cut carbon in the electricity sector, like a national renewable electricity standard and a clean energy standard, which permits nuclear power and natural gas. It also tested transportation regulations that already exist -- a fuel economy standard for new cars.

And it found that none of them works very well.

A renewable electricity standard and a transportation fuel economy standard would result in one-quarter of the emissions cuts attained by a cap-and-trade system. And all three would cost about the same, they said.

"Put differently, an equivalent level of emissions reduction could be achieved under a cap-and-trade system for less than 5% of the cost of either regulatory policy," said the researchers at the MIT Joint Program on the Science and Policy of Global Change.

If both regulatory plans were enacted -- one on electricity and the other on transportation -- their combined cost would be more expensive than a cap-and-trade system, the report says. But they would reduce just half the amount of emissions.

Take the transportation policy as an example. Increasing fuel efficiency only affects new cars, so carbon reductions can't be found in cheaper areas, like in agriculture or other industries, said Valerie Karplus, a research scientist with MIT and an author of the study.

"Any regulation that focuses on a subset of emissions reductions opportunities will therefore cost at least as much as an economy-wide cap-and-trade system, and often such targeted regulations actions can be much more costly," she said in an email.

Read more...

MIT researchers compare regulatory policies to a price on greenhouse gases and discover both the national and regional impacts.

First workshop convened high-ranking Chinese environmental officials and experts from top government, university and research offices.


The MIT-Tsinghua China Energy and Climate Project held a workshop on Tuesday March 12 to kick off a landmark study on the impact of China’s vehicle emissions and fuel standards on energy, economic, emissions, air quality and health. The study is being supported by a grant from the Energy Foundation, which provides resources to institutions that most effectively leverage change in transitioning to a sustainable energy future. The workshop, held at Tsinghua University, was hosted by collaborators at the university’s Institute for Energy, Environment, and Economy.

“Understanding the role fuel quality standards could play in cutting China’s emissions and air pollution is crucial to the health of the communities, as well as to addressing growing urban sustainability challenges,” says Valerie Karplus, director of the MIT-Tsinghua China Project and a co-researcher for the study. “This study will provide that insight. We’re grateful to have the support of the Energy Foundation, as well as feedback from a varied stakeholder base.”

The researchers will perform a comparison of policy options for reducing transportation emissions in China. This process will begin with an analysis of China’s transport sector and an updated inventory of emissions by sector. Researchers will also identify regional air quality impacts using a regional chemical transport model and analyze the impact of various policy options on energy use, emissions, the economy and human health.

“This study will be the first to use of an integrated model – simulating travel demand, fuel use, vehicles emissions and air quality – to determine health and economic impacts of fuel policies in China,” Eri Saikawa, a professor at Emory University and the lead researcher for the study, said. “The model will be a powerful tool for assessing transport policy options currently under discussion in China.”

Throughout the project, researchers will communicate their results to policymakers through an ongoing and interactive process. The March 12^th workshop was the first of several of these meetings. It brought together stakeholders from China’s Ministry of Environmental Protection and the Beijing Environmental Protection Bureau, as well as experts from Tsinghua University, Beijing University, Nanjing University, Clean Air Initiative-Asia, the International Council on Clean Transportation, the Energy Foundation, and the Health Effects Institute.

At the March 12^th meeting, the stakeholders provided input on which policy questions would be of greatest interest for the study to consider and explored how the results of the study might be used within their organizations. It was decided that the research would focus on assessing the impacts of fuel quality standards and tailpipe emissions standards in China, with a focus on the potential benefits of implementing the China 6 standard, which is the toughest standard announced so far and targets deeper reductions in nitrous oxide emissions country-wide before 2020.

By Brad Plumer
February 22, 2013

What’s the best way to curtail gasoline consumption? Economists tend to agree on the answer here: Higher gas taxes at the pump are more effective than stricter fuel-economy standards for cars and trucks.

Much more effective, in fact. A new paper from researchers at MIT’s Global Change program finds that higher gas taxes are “at least six to fourteen times” more cost-effective than stricter fuel-economy standards at reducing gasoline consumption.

Why is that? One of the study’s co-authors, Valerie Karplus, offers a basic breakdown here: Fuel-economy standards work slowly, as manufacturers start selling more efficient vehicles, and people retire their older cars and trucks. That turnover takes time. By contrast, a higher gas tax kicks in immediately, giving people incentives to drive less, carpool more, and buy more fuel-efficient vehicles as soon as possible.

A great deal also depends on whether biofuels and other alternative fuels are available. A tax on gasoline makes these alternative fuels more competitive, whereas fuel-economy standards don’t. “We see the steepest jump in economic cost between efficiency standards and the gasoline tax if we assume low-cost biofuels are available,” Karplus said in an MIT press release.

And yet… all this economic research never seems to have any effect on lawmakers. Since 2007, Congress and the Obama administration have moved to increase federal fuel economy standards, now scheduled to rise to 54.5 miles per gallon by 2025. According to the MIT estimates, this will cost the economy six times as much as simply raising the federal gas tax from its current level of 18.4 cents per gallon to 45 cents per gallon. Yet no one in Congress has even proposed the latter option.

One explanation is that the public just prefers things this way. Higher fuel-economy standards do impose costs, but they’re largely “hidden” costs — in the form of pricier vehicles in the showroom. A higher gas tax, by contrast, is visible every time people fill up at the pump.

In fact, a recent NBER paper by MIT’s Christopher Knittel found that this has been the case for decades. Between 1972 and 1980 the price of oil soared 650 percent. There was endless public debate during this period about how best to reduce reliance on fossil fuels. And, as Knittel discovered, the public consistently preferred price controls and fuel-economy standards over higher gas taxes. That was true no matter how often people were informed that gas taxes were the superior option.

“Given the saliency of rationing and vehicle taxes,” Knittel concluded, “it seems difficult to argue that these alternative polices were adopted because they hide their true costs.” In other words, the public seems to have an (expensive) preference for inefficient regulations over higher taxes to curb gasoline. Economists find it maddening, but it’s hard to change.

Further reading:

–On the other hand, if you want to see a rare economic argument for fuel-economy standards, check out this 2006 paper (pdf) by Christopher Knittel. He found that Americans were becoming less sensitive to fuel prices over time — which strengthened the case for policies like CAFE standards.

THE average price of gasoline in the United States, $3.78 on Thursday, has been steadily climbing for more than a month and is approaching the three previous post-recession peaks, in May 2011 and in April and September of last year.

But if our goal is to get Americans to drive less and use more fuel-efficient vehicles, and to reduce air pollution and the emission of greenhouse gases, gas prices need to be even higher. The current federal gasoline tax, 18.4 cents a gallon, has been essentially stable since 1993; in inflation-adjusted terms, it’s fallen by 40 percent since then.

Politicians of both parties understandably fear that raising the gas tax would enrage voters. It certainly wouldn’t make lives easier for struggling families. But the gasoline tax is a tool of energy and transportation policy, not social policy, like the minimum wage.

Instead of penalizing gasoline use, however, the Obama administration chose a familiar and politically easier path: raising fuel-efficiency standards for cars and light trucks. The White House said last year that the gas savings would be comparable to lowering the price of gasoline by $1 a gallon by 2025. But it will have no effect on the 230 million passenger vehicles now on the road.

Greater efficiency packs less of a psychological punch because consumers pay more only when they buy a new car. In contrast, motorists are reminded regularly of the price at the pump. But the new fuel-efficiency standards are far less efficient than raising gasoline prices.

In a paper published online this week in the journal Energy Economics, I and other scientists at the Massachusetts Institute of Technology estimate that the new standards will cost the economy on the whole — for the same reduction in gas use — at least six times more than a federal gas tax of roughly 45 cents per dollar of gasoline. That is because a gas tax provides immediate, direct incentives for drivers to reduce gasoline use, while the efficiency standards must squeeze the reduction out of new vehicles only. The new standards also encourage more driving, not less.

Other industrialized democracies have accepted much higher gas taxes as a price for roads and bridges and now depend on the revenue. In fact, Germany’s gas tax is 18 times higher than the United States’ (and seven times more if the average state gas tax is included). The federal gasoline tax contributed about $25 billion in revenues in 2009.

Raising the tax has generally succeeded only when it was sold as a way to lower the deficit or improve infrastructure or both. A 1-cent federal gasoline tax was created in 1932, during the Depression. In 1983, President Ronald Reagan raised the tax to 9 cents from 4 cents, calling it a “user fee” to finance transportation improvements. The tax rose again, to 14.1 cents in 1990, and to 18.4 cents in 1993, as part of deficit-reduction deals under President George Bush and President Bill Clinton.

A higher gas tax would help fix crumbling highways while also generating money that could help offset the impact on low- and middle-income families. Increasing the tax, as part of a bipartisan budget deal, with a clear explanation to the public of its role in lowering oil imports and improving our air and highways, could be among the most important energy decisions we make.

Valerie J. Karplus is a research scientist in the Joint Program on the Science and Policy of Global Change at M.I.T.

Read more about the study here. 

Related: Carbon Tax a 'Win-Win-Win' for America's Future

 

MIT researchers find vehicle efficiency standards are at least six times more costly than a tax on fuel.

IN CASE YOU MISSED IT: Valerie Karplus makes her case in an op-ed in the NY Times here. 

Vehicle efficiency standards have long been considered vital to cutting the United States’ oil imports. Strengthened last year with the added hope of reducing greenhouse gas emissions, the standards have been advanced as a way to cut vehicle emissions in half and save consumers more than $1.7 trillion at the pump. But researchers at MIT find that, compared to a gasoline tax, vehicle efficiency standards come with a steep price tag.

“Tighter vehicle efficiency standards through 2025 were seen as an important political victory. However, the standards are a clear example of how economic considerations are at odds with political considerations,” says Valerie Karplus, the lead author of the study and a researcher with the MIT Joint Program on the Science and Policy of Global Change. “If policymakers had made their decision based on the broader costs to the economy, they would have gone with the option that was least expensive – and that’s the gasoline tax.”

The study, published this week in the March edition of the journal Energy Economics, compares vehicle efficiency standards to a tax on fuel as a tool for reducing gasoline use in vehicles. The researchers found that regardless of how quickly vehicle efficiency standards are introduced, and whether or not biofuels are available, the efficiency standards are at least six times more expensive than a gasoline tax as a way to achieve a cumulative reduction in gasoline use of 20 percent through 2050. That’s because a gasoline tax provides immediate, direct incentives for reducing gasoline use, both by driving less and investing in more efficient vehicles. Perhaps a central reason why politics has trumped economic reasoning, Karplus says, is the visibility of the costs.

“A tax on gasoline has proven to be a nonstarter for many decades in the U.S., and I think one of the reasons is that it would be very visible to consumers every time they go to fill up their cars,” Karplus says. “With a vehicle efficiency standard, your costs won't increase unless you buy a new car, and even better than that, policymakers will tell you you’re actually saving money. As my colleague likes to say, you may see more money in your front pocket, but you’re actually financing the policy out of your back pocket through your tax dollars and at the point of your vehicle purchase.”

Along with being more costly, Karplus and her colleagues find that it takes longer to reduce emissions under the vehicle efficiency standards. That’s because, with more efficient vehicles, it costs less to drive, so Americans tend to drive more. Meanwhile, the standards have no direct impact on fuel used in the 230 million vehicles currently on the road. Karplus also points out that how quickly the standards are phased in can make a big difference. The sooner efficient vehicles are introduced into the fleet, the sooner fuel use decreases and the larger the cumulative decrease would be over the period considered, but the timing of the standards will also affect their cost.

The researchers also find that the effectiveness of the efficiency standards depends in part on the availability of other clean-energy technologies, such as biofuels, that offer an alternative to gasoline.

“We see the steepest jump in economic cost between efficiency standards and the gasoline tax if we assume low-cost biofuels are available,” Karplus says. “In this case, if biofuels are available, a lower gasoline tax is needed to displace the same level of fuel use over the 2010 to 2050 time frame, as biofuels provide a cost-effective way to displace gasoline above a certain price point. As a result, a lower gas tax is needed to achieve the 20 percent cumulative reduction.”

To project the impact of vehicle efficiency standards, Karplus and her colleagues improved the MIT Emissions Predictions and Policy Analysis Model that is used to help understand how different scenarios to constrain energy affect our environment and economy. For example, they represent in the model alternatives to the internal combustion engine based on the expected availability and cost of alternative fuels and technologies, as well as the dynamics of sales and scrappage that affect the composition of the vehicle fleet. Their improvements to the model were recently published in the January 2013 issue of the journal Economic Modelling.

Related: Carbon Tax a 'Win-Win-Win' for America's Future 

Karplus, Paltsev recieve award for study on the impacts of vehicle efficieny stanards

Valerie Karplus, Research Scientist, and Sergey Paltsev, Assistant Director for Economic Research with MIT’s Joint Program on the Science and Policy of Global Change, were awarded the 2012 Pyke Johnson Award at a ceremony last night during the annual meeting for the National Research Council's Transportation Research Board. The Pyke Johnson Award recognizes the best paper in the area of planning and the environment.

Published in November in the journal Transportation Research Record, the study looks into the new vehicle efficiency standards. The standards are considered one of the landmark environmental achievements of President Obama’s first term, and have been touted as a way to save consumers more than $1.7 trillion at the pump and cut vehicle emissions in half. Karplus and Paltsev look behind the numbers to understand the full energy and economic impacts.  

“Common thinking in Washington holds that any policy that seems to advance technology without creating new taxes must be a no brainer for the country. That misses the broader economic impact,” says Karplus. “As my colleague says, you may see more money in your front pocket at the pump, but you’re financing the policy out of your back pocket through your tax dollars and at the point of your vehicle purchase.”

Of the research, University of Maine environmental economist Jonathan Rubin, chair of the Transportation Energy Committee of the Transportation Research Board, says, “The research of Dr. Karplus on the energy and climate impacts of the nation’s fuel economy standards for our cars and trucks makes an important contribution to policy-making based on science.”

The new fuel standards require automakers to install pollution-control technology to improve the fuel efficiency of cars by 5 percent and light trucks by 3.5 percent with each new model year starting in 2017.  Karplus and her colleague simulated the proposed standards, and found that while drivers of these more efficient vehicles will no doubt save at the pump, they could spend several thousands of dollars more when buying their new car. Even more troubling, diverting efforts toward improved vehicle efficiency distracts attention away from policies that would target the broader economy and reduce fuel use or emissions more cost effectively, such as a carbon tax.

Estimates of how costly the policy would be – in terms of both direct costs to consumers and the larger rippling costs to the economy – hinge on the relative cost of the technology available to improve efficiency. The shorter the time frame automakers are given to develop the technology and produce more efficient vehicles, the less time there will be for technological progress and other factors to drive down costs  and the more consumers will need to pay upfront. Emissions and oil imports will drop – both due to increased fuel efficiency and as the higher vehicle costs weighs on consumer budgets – but will be offset as consumers face lower costs per mile traveled, incentivizing more driving.

Karplus hopes her results will help policymakers make more informed decisions going forward. She credits that to the innovative method she used, which weaves engineering and technology constraints into a broad economic framework and allows researchers to test the cost and other impacts of a policy at different levels of stringency. This method inherently takes account of life-cycle emissions, as well as impacts that transmit across fuel markets by affecting prices. For example, a policy might only consider gasoline use by plug-in electric hybrids, but that “tailpipe measure” doesn’t take into account the emissions created from building, transporting and recharging those batteries. Her approach does.

“There are a lot of hidden costs to a policy like this,” Karplus says. “This model doesn’t allow you to ignore other important aspects of the economy and energy systems. It requires you to be explicit about your technology and cost assumptions.  It provides a framework that allows lawmakers to look at all the available information on costs and the state of the technology and decide how to best create or update policies.”

MIT researchers show merits of a carbon tax.

New standards to strengthen vehicle fuel efficiency are considered one of the landmark environmental achievements of President Obama’s first term. Passed with the backing of automakers and autoworkers, the measure has been touted as a way to save consumers more than $1.7 trillion at the pump and cut carbon emissions from passenger vehicles in half. While the standards have many good merits, a more effective approach might be an economy-wide carbon tax, say researchers at MIT’s Joint Program on the Science and Policy of Global Change.

The researchers look at the full energy and economic impacts of the efficiency standards, which in their finalized form now require automakers to install pollution-control technology to improve the fuel efficiency of cars by 5 percent and light trucks by 3.5 percent with each new model year starting in 2017.  Published this month in the journal Transportation Research Record, the study won this year’s Pyke Johnson Award for the best paper in the area of planning and the environment. 

“Common thinking in Washington holds that any policy that seems to advance technology without creating new taxes must be a no brainer for the country. That misses the broader economic impact,” says Joint Program Research Scientist Valerie Karplus, the lead author of the study. “As my colleague says, you may see more money in your front pocket at the pump, but you’re financing the policy out of your back pocket through your tax dollars and at the point of your vehicle purchase.”

Instead, Karplus says a gasoline or carbon tax makes more sense economically by providing consumers a direct incentive to either reduce their driving or buy more efficient vehicles.

“From an economic perspective that’s very clear, but from a political feasibility perspective it’s very different,” she says. Unlike fuel standards that hide the true costs, “a tax on gasoline has proven to be a nonstarter for many decades in the U.S., and I think one of the reasons is that it would be very visible to consumers every time they go to fill up their cars.”

The one hope, Karplus and some of her colleagues at the Joint Program say, is that in the midst of deficit talks a tax on carbon emissions might be considered to help raise the money needed to slash the deficit and avoid some tax hikes and spending cuts. The program published a study in August that looked at the effectiveness of this approach. That study showed that with a carbon tax the economy could overall improve, other taxes could be lowered and pollution emissions would be reduced.

“Congress will face many difficult tradeoffs in stimulating the economy and job growth while reducing the deficit,” says John Reilly, the co-director of the Joint Program and an author of the carbon tax study. “But with the carbon tax there are virtually no serious tradeoffs.”

Conversely, when Karplus and her colleagues simulated the proposed fuel economy standards, they found that while drivers of these more efficient vehicles will likely save at the pump, they could on average spend several thousands of dollars more when buying their new car, consistent with EPA estimates. Even more troubling, diverting efforts toward improved vehicle efficiency distorts overall economic activity, adding to the indirect cost of the policy.

Estimates of how costly the policy would be — in terms of both direct costs to consumers and the larger rippling costs to the economy — hinge on the relative cost of the technology and other strategies available to improve efficiency. The shorter the time frame automakers have to develop the technology and produce more efficient vehicles, the less time there will be for technological progress and other factors to drive down costs — such as the cost of batteries — and the more consumers will need to pay upfront. Emissions and oil imports will initially drop, both due to increased fuel efficiency and as the higher vehicle costs weigh on consumer budgets. But as consumers face lower costs per mile traveled, they may drive more, offsetting reductions in emissions and oil imports.

Karplus hopes her results will help policymakers make more informed decisions going forward. She credits that to the innovative — and award-winning — method she used, which weaves engineering and technology constraints into a broad economic framework and allows researchers to test the cost and other impacts of a policy at different levels of stringency. This method inherently takes account of life-cycle emissions as well as impacts that transmit across fuel markets by affecting prices.

For example, a policy might only consider gasoline use by plug-in electric hybrids. But that “tailpipe measure” doesn’t take into account the emissions created from building, transporting and recharging those batteries. Her approach does.

“There are a lot of hidden costs to a policy like this,” Karplus says. “This model doesn’t allow you to ignore other important aspects of the economy and energy systems. It requires you to be explicit about your technology and cost assumptions.  It provides a framework that allows lawmakers to look at all the available information on costs and the state of the technology and decide how to best create or update policies.”

Of this approach, University of Maine environmental economist Jonathan Rubin, says “The research of Dr. Karplus on the energy and climate impacts of the nation’s fuel economy standards for our cars and trucks makes an important contribution to policymaking based on science.”

Rubin is the chair of the Transportation Energy Committee of the Transportation Research Board, which will honor Karplus with the Pyke Johnson award at a ceremony in January.

The inescapable importance of China to global energy and climate efforts has compelled the Joint Program—in collaboration with Tsinghua University—to launch a special research effort called the China Energy and Climate Project.