Editing IPCC:AR6/WGIII/Chapter-13 (section)

==== 13.6.4.3 Performance of Regulatory Instruments ====

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Regulatory policy instruments tend to be more economically costly than pricing instruments, as explained above. However, regulatory policies may be preferred for other reasons.

In some cases, regulatory policy can elicit greater political support than pricing policy ( [[#Tobler--2012|Tobler et al. 2012]] ; [[#Lam--2015|Lam 2015]] ; [[#Drews--2016|Drews and van den Bergh 2016]] ). For example, USA citizens have expressed more support for flexible regulation like the RPS than for carbon taxes ( [[#Rabe--2018|Rabe 2018]] ). And a survey in British Columbia a few years after the simultaneous implementation of a carbon tax and two regulations – the LCFS and a clean electricity standard – found much less strong opposition to the regulations, even after being informed that they were costlier to consumers ( [[#Rhodes--2017|Rhodes et al. 2017]] ). The degree of public support for regulations depends, however, on the type of regulation, as outright technology prohibitions can be unpopular ( [[#Attari--2009|Attari et al. 2009]] ; [[#Cherry--2012|Cherry et al. 2012]] ).

In comparison to economic instruments, regulatory policies tend to cause greater cost of living increases in percentage terms for lower income consumers – called policy regressivity ( [[#Levinson--2019|Levinson 2019]] ; [[#Davis--2019|Davis and Knittel 2019]] ). And unlike carbon taxes, regulations do not generate revenues that can be used to compensate lower income groups.

A renewable energy procurement obligation in South Africa successfully required local hiring with perceived positive results ( [[#Walwyn--2015|Walwyn and Brent 2015]] ; [[#Pahle--2016|Pahle et al. 2016]] ), a clean energy regulation in Korea was perceived to provide greater employment opportunities ( [[#Lee--2017|Lee 2017]] ), and a UK obligation on energy companies to provide energy retrofits to low-income households improved energy affordability according to participants ( [[#Elsharkawy--2018|Elsharkawy and Rutherford 2018]] ).

From an energy system transformation perspective, technology standards, including phase-out mandates, have particular promise to achieve profound change in specific sectors and technologies ( [[#Tvinnereim--2018|Tvinnereim and Mehling 2018]] ). As such policies change the technologies available in the market, then economic instruments can also have a greater effect ( [[#Pahle--2018|Pahle et al. 2018]] ).

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