A balance of bottom-up and top-down in linking climate policies

NATURE CLIMATE CHANGE | VOL 4 | DECEMBER 2014 | www.nature.com/natureclimatechange The top-down approach to mitigating climate change as exemplified by the UNFCCC negotiations and the Kyoto Protocol has all but stalled, due to a panoply of political objections. To craft a more workable policy, states and non-state actors alike have shifted their focus to bottom-up ‘linkage’ of multinational, national, and subnational cap-and-trade systems1–8. Although linkages between markets could provide a framework for international cooperation on climate policy, they cannot guarantee the seamless development of a decentralized and self-enforcing governance mechanism. We identify four obstacles to successful linkage, which turn out to be similar to those that have plagued the global climate negotiations. Domestically, they include the challenge of agreeing on and evaluating different levels of ambition as well as the potential incompatibility with other domestic policy objectives. Across jurisdictions, obstacles may arise from political objections to financial transfers, and the difficulty of close regulatory coordination. Given the importance of finding a path toward an effective architecture for global climate policy, we suggest an incremental approach that combines elements of decentralized experimentation with strategic negotiations, which could help to manage and overcome these obstacles. Careful, gradual linkage could serve as an important political instrument and learning process, but it will not provide a way around ‘global warming gridlock’3. An effective global policy architecture will still require close international coordination with a balance of bottom-up and top-down elements.