OECD STUDY ON GOVERNMENTS’ RESPONSES TO THE ENERGY CRISIS
During our first stakeholders’ workshop in Milan, the OECD presented the results of their study on governments’ responses to the energy crisis: in short, these were summarised as “quick and robust but untargeted”. One key message underlined in the study is that the crisis had not derailed much of the climate change mitigation efforts. Another study by the OECD, launched before the energy crisis, assessed the support for climate policies. On the occasion of the workshop, the OECD invited the consortium to evaluate how absolute and relative levels and ambitions of climate policies have changed as a result of the crisis and whether behavioural reaction changes have been observed to allow for a broader understanding of pricing mechanisms.
The chair of the session presented the results of a poll among participants in the workshop. Although there was no clear consensus among the respondents, more participants considered that ambition for climate mitigation policies had increased due to the energy crisis. Moreover, respondents believed the race to clean energy technologies would lead to an increase in global emissions reductions (48%), speed up technology change (81,5%) and maintain (44%) or decrease (37%) international equity.
A small majority (52%) believed that the support for climate policies among the EU population had increased as a consequence of the energy crisis. However, this support may vary across policy instruments. According to respondents, the public acceptance of specific policies, such as renewable energy subsidies, energy efficiency measures, and protectionist policies, had evolved.
Public acceptance of carbon pricing, on the other hand, was considered to have changed less when compared to the latter. The elements most at risk of implementation failure due to the energy crisis were considered to be the ETS 2 for road transport and buildings, as well as the energy taxation directive. The phase‐out of new sales of internal combustion engines by 2035 could also be at risk. Most respondents held that climate policy ambition would decrease globally due to the energy crisis. Finally, respondents urged the need for better coordination and coherence of EU climate policies with other policies in the following order of priority: industrial policies (74,1%), macro‐economic policies (59%), environmental policies (52%) and trade policies (52%).
The discussion that followed primarily focused on the interplay between policies and behaviours. The participants invited the project team to consider the following aspect of their work.
An analysis and better understanding of what policies can trigger behavioural change and how they achieve that is a paramount step to effectively changing behaviour with a view to support set policy objectives. This could be particularly relevant in sectors such as food consumption and agriculture. Moreover, it was noted that behaviours and emotions sometimes tend to affect perceptions and habits more than actual policy or prices. In this context, discussions highlighted the study by the European Commission and the IEA on key energy‐saving actions. One participant questioned whether behaviours would change if the actual impacts of climate change were to be emphasised.
Valuable learnings can be drawn from the response to the energy crisis. First, it is important to acknowledge the amount of financial resources that were wasted in the form of non‐targeted support. Conversely, targeted support may slow down the speed of decision‐making in a crisis period. Also, values may affect the definition of targeted groups. Not least, some participants underlined the need to differentiate the impact on energy security in the short term, which can be attributed to emotional reactions rather than price or policy.
While high carbon prices are key, the internalisation of other social costs will also have to be considered, not least given that market designs can also have distributional impacts. Issues such as poverty in the food and energy sectors will have to be carefully accounted for and measures enacted to ensure the carbon price does not affect them. One added value would be to look at policy packages more holistically rather than at specific policies. In sum, participants highlighted the importance of designing policies or packages that can simultaneously address social and climate issues. The review should thus include social policies equally, not only climate policies.
