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Distribution as the Organizing Principle of Environmental Regulation

Published online by Cambridge University Press:  06 March 2019

Suryapratim Roy

Abstract

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This Article argues that distributional concerns constitute the heart of environmental regulation; they are not restricted to pre-policy values or post-policy effects that need to dealt with. On the contrary, they characterize the selection of environmental policies, and their properties. Different interests, preferences, and values with respect to a policy instrument can be made commensurable using the language of distribution. The centrality of distribution as an organizing principle may be elusive on account of it being too vaguely construed or too narrowly defined. This necessitates the articulation of a typology of distributional concerns. To this end, it is suggested that the distribution of benefits and burdens, distribution of responsibility, distribution of membership and distribution of capabilities could be useful categories to develop and assess environmental regulation. This framework is then applied to an unsuspecting candidate, the European Union Emissions Trading Scheme (EU ETS).

Type
Developments
Information
German Law Journal , Volume 19 , Issue 3 , 01 June 2018 , pp. 649 - 664
Copyright
Copyright © 2018 by German Law Journal, Inc. 

References

1 There is a substantial body of scholarship on the centrality of civil and constitutional rights to American environmental law. For a review of the initial developments, see Lazarus, Richard, Pursuing “Environmental Justice”: The Distributional Effects of Environmental Protection, 87 NW. L. R. 787 (1993).Google Scholar

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40 Caney clarifies that the primary distinction between distribution of responsibilities and distribution of burdens is that the former deals with the assignment of duties or responsibilities to prevent climate change, which is in effect the assignment of liability “of those who have failed to comply with theirs [responsibilities].” The latter deals with the imposition of burdens on third-parties without responsibilities by those who have been assigned such responsibilities. Such burdens may be justified given the “priority of climate change;” it amounts to “appeasing reluctant emitters [or responsibility bearers] and acceding to their demands to bear less costs than they ought to.” Simon Caney, Climate Change and Non-Ideal Theory: Six ways of Responding to Noncompliance, in Climate Justice in a Non-ideal World 25–28 (Clare Heyward & Dominic Roser eds., 2016).Google Scholar

41 The European Court of Justice observed that the pass-through of costs by producers included in the EU ETS to consumers is not prohibited, but, at the same time, not essential for reducing emissions. Cases C-566/11, C-567/11, C-580/11, C-591/11, C-620/11 and C-640/11, Iberdrola v. Administración del Estado (2013), http://curia.europa.eu/.Google Scholar

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45 The problem with Double Counting is if a single abatement action is counted more than once. This would be a problem as there would potentially be an overestimation of the amount of emissions mitigated. If the primary proxy for the effectiveness of a climate policy is the satisfaction of climate targets, then the targets would be met sooner with an accounting inflation. In other words, a quantity mechanism proxied through the satisfaction of a climate target would not correspond with actual abatement. Steven Sorrell, Who Owns the Carbon? Interactions Between the EU Emissions Trading Scheme and the UK Renewables Obligation and Energy Efficiency Commitment, 14 Energy & Env't 677, 692–94 (2003).Google Scholar

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49 It would be incorrect to characterize the EU ETS as a policy mechanism mediated solely by market interests, owing to the heavy regulatory oversight and liability to pay a fine for non-compliance, as discussed in this Article. These features in combination with sophisticated market instruments create the climate policy complex in the EU that makes different interests commensurable. This is why the EU ETS is uniquely placed in the distribution of responsibility to States and firms, and perhaps not to other entities where human and nonhuman interests would have to be valued. For a discussion, see Dalsgaard, Steffen, Carbon Value Between Equivalence and Differentiation, 5 Env't & Soc'y 86 (2014).Google Scholar

50 This does not, however, discount the meta-principle of proportionality in thinking through the institutional basis and individual policy instruments in the EU policy framework. Cendra de Larragan argues that this meta-principle is helpful in assessing the characteristics of any policy instrument with respect to (i) the relationship between means and ends; (ii) the distribution of benefits and burdens; and (iii) the participation of those affected by the regulation in question. Javier Cendra de Larragan, Distributional Choices in EU Climate Change Law and Policy: Towards a Principled Approach? 11 (2011).Google Scholar

51 The “objective and reasonable criterion” to gauge the “appropriateness of Community legislative action” in this case was “administrative feasibility” and “administrative complexity” of the EU ETS that is “novel and complex”: The Court felt that based on administrative concerns, for the purpose of the implementation of the EU ETS, it is necessary “attain the critical mass of participants necessary for the scheme to be set up” in a step-by-step manner. Société Arcelor Atlantique et Lorraine and Others, supra note 23 at para. 60.Google Scholar

52 Iberdrola, supra note 41 at para. 79. This can be gleaned from the fact that unlike Advocate General Kokott's identification of energy efficiency as an objective integral to the EU ETS, the Court considers all objectives other than emissions reduction as sub-objectives. For a discussion, see Rodriguez, Daniel Perez, Absorbing EU ETS Windfall Profits and the Principle of Free Allowances: Iberdrola and Others, 51 Common Mkt L. Rev. 679, 690–693 (2014).Google Scholar

53 Given the ability of some EU institutions, Member States, and private parties to shape the distribution of responsibility, burdens and benefits, and accordingly avoid a carbon tax, it is highly unlikely that a tax would be given due consideration from the point of progressive environmental effects. Even if we were to accept the non-viability of a tax, there could be changes made to the EU ETS itself to ensure achievement of progressive environmental effects. It has been argued that setting a price floor may well enhance the environmental integrity of the EU ETS to ensure that the price set by the market does not compromise the effectiveness of the binding emissions cap. Frédéric Branger, Oskar Lecuyer, Philippe Quirion, The European Union Emissions Trading Scheme: Should we throw the flagship out with the bathwater?, 6 WIREs Climate Change 9, 12 (2015).Google Scholar