Editing IPCC:AR6/SR15/Chapter-4 (section)

==== 4.4.5.3 Regulatory measures and information flows ====

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Regulatory instruments are a common tool for improving energy efficiency and enhancing renewable energy in OECD countries (e.g., the USA, Japan, Korea, Australia, the EU) and, more recently, in developing countries (M.J. Scott et al., 2015; Brown et al., 2017) <sup>[[#fn:r1386|1386]]</sup> . Such instruments include constraints on the import of products banned in other countries (Knoop and Lechtenböhmer, 2017) <sup>[[#fn:r1387|1387]]</sup> .

For energy efficiency, these instruments include end-use standards and labelling for domestic appliances, lighting, electric motors, water heaters and air-conditioners. They are often complemented by mandatory efficiency labels to attract consumers’ attention and stimulate the manufacture of more efficient products (Girod et al., 2017) <sup>[[#fn:r1388|1388]]</sup> . Experience shows that these policy instruments are effective only if they are regularly reviewed to follow technological developments, as in the ‘Top Runner’ programme for domestic appliances in Japan (Sunikka-Blank and Iwafune, 2011) <sup>[[#fn:r1389|1389]]</sup> .

In four countries, efficiency standards (e.g. miles per gallon or level of CO <sub>2</sub> emission per kilometre) have been used in the transport sector, for light- and heavy-duty vehicles, which have spillovers for the global car industry. In the EU (Ajanovic and Haas, 2017) <sup>[[#fn:r1390|1390]]</sup> and the USA (Sen et al., 2017) <sup>[[#fn:r1391|1391]]</sup> , vehicle manufacturers need to meet an annual CO <sub>2</sub> emission target for their entire new vehicle fleet. This allows them to compensate through the introduction of low-emission vehicles for the high-emission ones in the fleet. This leads to increasingly efficient fleets of vehicles over time but does not necessarily limit the driven distance.

Building codes that prescribe efficiency requirements for new and existing buildings have been adopted in many OECD countries (Evans et al., 2017) <sup>[[#fn:r1392|1392]]</sup> and are regularly revised to increase their efficiency per unit of floor space. Building codes can avoid locking rapidly urbanizing countries into poorly performing buildings that remain in use for the next 50–100 years (Ürge-Vorsatz et al., 2014) <sup>[[#fn:r1393|1393]]</sup> . In OECD countries, however, their main role is to incentivize the retrofit of existing buildings. In addition of the convergence of these codes to net zero energy buildings (D’Agostino, 2015) <sup>[[#fn:r1394|1394]]</sup> , a new focus should be placed, in the context of 1.5°C-consistent pathways, on public and private coordination to achieve better integration of building policies with the promotion of low-emission transportation modes (Bertoldi, 2017) <sup>[[#fn:r1395|1395]]</sup> .

The efficacy of regulatory instruments can be reinforced by economic incentives, such as feed-in tariffs based on the quantity of renewable energy produced, subsidies or tax exemptions for energy savings (Bertoldi et al., 2013; Ritzenhofen and Spinler, 2016; García-Álvarez et al., 2017; Pablo-Romero et al., 2017) <sup>[[#fn:r1396|1396]]</sup> , fee-bates, and ‘bonus-malus’ that foster the penetration of low-emission options (Butler and Neuhoff, 2008) <sup>[[#fn:r1397|1397]]</sup> . Economic incentives can also be combined with direct-use market-based instruments, for example combining, in the United States and, in some EU countries, carbon trading schemes with energy savings obligations for energy retailers (Haoqi et al., 2017) <sup>[[#fn:r1398|1398]]</sup> , or with green certificates for renewable energy portfolio standards (Upton and Snyder, 2017) <sup>[[#fn:r1399|1399]]</sup> . Scholars have investigated caps on utilities’ energy sales (Thomas et al., 2017) <sup>[[#fn:r1400|1400]]</sup> and emission caps implemented at a personal level (Fawcett et al., 2010) <sup>[[#fn:r1401|1401]]</sup> .

In combination with the funding of public research institutes, grants or subsidies also support R&amp;D, where risk and the uncertainty about long-term perspectives can reduce the private sector’s willingness to invest in low-emission innovation (see also Section 4.4.4). Subsidies can take the form of rebates on value-added tax (VAT), of direct support to investments (e.g., renewable energy or refurbishment of buildings) or feed-in tariffs (Mir-Artigues and del Río, 2014) <sup>[[#fn:r1402|1402]]</sup> . They can be provided by the public budget, via consumption levies, or via the revenues of carbon taxes or pricing. Fee-bates, introduced in some countries (e.g., for cars), have had a neutral impact on public budgets by incentivizing low-emission products and penalizing high-emission ones (de Haan et al., 2009) <sup>[[#fn:r1403|1403]]</sup> .

All policy instruments can benefit from information campaigns (e.g., TV ads) tailored to specific end-users. A vast majority of public campaigns on energy and climate have been delivered through mass-media channels and advertising-based approaches (Corner and Randall, 2011; Doyle, 2011) <sup>[[#fn:r1404|1404]]</sup> . Although some authors report large savings obtained by such campaigns, most agree that the effects are short-lived and decrease over time (Bertoldi et al., 2016) <sup>[[#fn:r1405|1405]]</sup> . Recently, focus has been placed on the use of social norms to motivate behavioural changes (Allcott, 2011; Alló and Loureiro, 2014) <sup>[[#fn:r1406|1406]]</sup> . More on strategies to change behaviour can be found in Section 4.4.3.

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