Carbon leakage – the increase of greenhouse gas emissions in foreign jurisdictions following the introduction of domestic or regional climate mitigation measures – raises key questions in the climate change debate. This includes whether carbon leakage constitutes a threat to the environmental integrity of climate policies and, if so, how this could be mitigated. Through the use of four hypothetical models of international climate change regime, this article argues that international climate change law is a key factor in answering this two-part question. Firstly, the article demonstrates that the architecture of international climate change law affects whether carbon leakage can be considered as undermining the mitigation objective of climate policies. Secondly, it draws attention to the interaction – and potential tension – between carbon leakage prevention measures and international climate change law.

Climate change has pushed governmental authorities within the United States (US) into new routes of national and transnational policy-making. The normal route for national policy-making runs from Congress in setting policy, to the President in agency implementation, to judicial oversight and enforcement. When that route is blocked, however, federalism and the separation of powers provide some byways and detours that may still be used to make progress. State governments and the executive branch have moved into the breach left by congressional deadlock. In the absence of federal climate legislation or a formal treaty, however, constitutional challenges will predictably meet efforts to limit carbon leakage or to establish linkages between regulatory systems.

These constitutional issues often involve corners of constitutional law such as foreign affairs, where doctrines are particularly murky. Solid arguments can be made in favour of state efforts to avoid leakage and create linkage, despite claims of discrimination against interstate commerce, extraterritoriality, and foreign affairs pre-emption. The Environmental Protection Agency has some statutory authority to deal with leakage, and the President seems to have authority to pursue linkage through executive agreement. Thus, both states and the executive branch should have room to deal with transboundary implications of climate policies. Although the deadlock in Congress regarding climate change may be unusually severe, these modes of response may also be important for other kinds of transnational activity by US state governments and the national executive.