To understand what drives policy development, we need to think about the geographic scales of influence on any given body that may develop and implement policy. A useful framework for this is to think about vertical and horizontal policy diffusion.

• Vertical policy diffusion occurs when a policy mechanism adopted at one scale of governance transfers to others (and this can occur in either direction). An example might be a state adopting ambitious Corporate Average Fuel Economy (CAFÉ) standards for fuel economy, which are then adopted by the federal government. In this example, the policy mechanism (CAFE standards) moves from the state to the federal level - or diffuses vertically.
  
  This makes a lot of sense, and not just in issues related to climate change. Sometimes we try things out at one scale as a bit of a pilot for what it might look like at a larger scale. This was true with the Renewable Portfolio Standards (RPS) at the state level - that was widely thought to be a testing ground for a national RPS system that never came about. We are a constitutional republic, not a traditional simple democracy, so states have certain unique rights and freedoms, including self-governance to an extent, relative to Federal requirements. This allows states that have compelling reasons or a desire to try something new for its own benefit, to get out ahead of the Federal action.
• Horizontal policy diffusion occurs when a policy mechanism adopted at a scale of governance transfers to other areas at that same scale. An example of this might be a state adopting renewable portfolio standards after seeing a neighboring state do so, or a municipality choosing to set a greenhouse gas emissions reduction target after learning about success in other municipalities around the country. In this example, the policy mechanisms are staying at the same geographic scale, but diffusing horizontally outward to other entities at that same scale.
  
  It's not just policy where we look to our peers to see how they're handling a particular challenge or issue, so this is no surprise that policy creation would follow a similar pattern. Being able to speak to the success of a policy mechanism in a similar application elsewhere lends credibility and can assuage concerns about effectiveness, popularity with constituents, or costs.

Horizontal and Vertical Reinforcement in Global Climate Governance (Martin Jänicke, 2015)

Credit: Martin Jänicke. Horizontal and Vertical Reinforcement in Global Climate Governance. MDPI. June 16, 2015

Both types of policy diffusion are critical to addressing the global climate challenges we face. The Obama era Clean Power Plan - while inherently a federal policy, it offered states wide-ranging flexibility in how they'd set and meet their targets, including the opportunity to collaborate regionally. This illustrates both vertical and horizontal policy diffusion. The Paris Agreement is another example - it's an international agreement with nationally determined contributions that very likely would require integration at the state and local scales as well. But what if one level of governance isn't as active as others? This has happened in the past where an Administration may not have been as aggressive with certain policy areas, but states and other players wished to continue moving ahead. While the federal government in the U.S. wasn't actively seeking to address climate change through federal policy measures, states, municipalities, and businesses were continuing to work in this space and were learning from what their counterparts were doing - a strong example of horizontal diffusion.

One common way that policies are actively diffused is through publishing best practices, case studies, and other resources. Not only can you save time by modifying an existing policy instead of creating it from scratch, but you can also evaluate the effectiveness of the policy where it was originally applied. See e.g. the Resource Library for the Global Covenant of Mayors for Climate and Energy. The Horizontal and Vertical Reinforcement in Global Climate Governance article is a good read if you're interested in understanding this better.

Who is developing our climate policy? It depends heavily on the scale of governance. For this discussion, we'll focus primarily on federal level energy policy - but keep in mind that similar networks exist at other scales. Let's take a look at the roles these groups play and how they work together.

Legislators

Our elected officials provide the voice for legislation as it works its way through its designated approval process. Here, we could be talking about a township adopting a resolution or state or federal representatives proposing a bill.

Executive Branch and the Executive Office of the President

Our Agencies can develop and implement types of policy. Usually, this relates to agency-specific topics and cover issues that do not require Congressional approval or authorization. Remember that legislators and Congress are but one of three branches of government; the Executive Branch, headed by the President, has its own set of powers and authorities. The Executive Order is a great example of Executive Branch-level policy.

Special Interest Groups

Special interest groups are coalitions of people and organizations banded together by common beliefs on policy decisions. Working together, these groups have the power to inform and influence policy decisions through correspondence with legislators and their staff. While we often think only of the negative side of special interest groups, they do also serve an important role in keeping policymakers informed.

Scientists

The scientific community has an important role to play in the development of policy, especially with issues related to energy and the environment. Many scientists directly inform the president, through mechanisms that vary from administration to administration.  Much advice comes from scientists and staff within the Executive Office of the President, which includes the White House Council on Environmental Quality and the Office of Science and Technology Policy. Scientists and researchers are also called on to testify at congressional hearings related to energy bills. For environmental and energy challenges, legislators usually rely on the scientific community to provide them with the basis for legislation must exist. At the local level, scientists still often provide an important voice to the validity of proposed measures. There are also scientists within the Federal agencies who can offer advice. 

With regard to energy policy specifically, here are just a few of the issues on which the scientific community provides its expert opinions to policymakers:

• acceptable levels for criteria pollutants produced during the extraction, processing, and combustion of fossil fuels
• quantity of fuel reserves available for extraction
• safe levels of carbon dioxide and other greenhouse gas concentrations in the atmosphere
• potential consequences of a warming climate due to increased greenhouse gas concentrations
• understanding uncertainty and unknowns associated with natural systems
• risks associated with the extraction of fossil fuels
• issues related to necessary infrastructure for new energy technologies

Private Citizens

Believe it or not, as a voter, your voice matters! Last week, we looked specifically at the role citizens play in climate policy decisions. It's important not only that you stay informed about the issues affecting your life, but that you voice your preferences for policies about them to your elected officials. Politicians want to stay in office, and that means keeping their constituents happy. Be a proactive and engaged citizen. Let your leadership know that you're paying attention.

It is exceedingly rare to have perfect circumstances under which to develop and pass policy. It's important to recognize that policy development must fit within larger agendas, and sometimes seemingly unrelated issues can make it difficult to pass even a popular policy. Let's take a look at some of the threats to policy change and think about how they relate specifically to energy policy.

Political Disagreement

Sometimes it's not about finding agreement that something should or should not be done, but how it should be done that causes problems. Energy policy is a perfect example of this. On both sides of the aisle, politicians agree that revamping domestic energy policy is a worthwhile venture, agreeing most about the national security benefits of reducing US dependence on foreign oil. However, there is a clear disagreement about how to achieve that goal, with Democrats generally more interested in renewable energy and Republicans tending to promote domestic fossil fuel extraction and more of a multiple solution approach. Interest groups' influence often weighs heavily in these decisions - especially at the federal level, less so at the local level - though constituents can also be influential. This is particularly true with energy and climate policy, as there are many interest groups that get involved, some of which are quite influential and well-funded (e.g. fossil fuel companies and individuals who make money from the fossil fuel industry). It is also not uncommon for one policy to be "held up" until an agreement is made on a separate policy (aka "horsetrading").

Status Quo

Inertia is a powerful force in politics. While all sides might agree that a current practice isn't the best or most efficient, a known inefficiency is often less daunting than the potential negative impacts of an unknown alternative, leaving things unchanged. Economic impacts are an especially potent consideration in energy politics in this regard. Addressing energy challenges often involves internalizing the cost of environmental degradation associated with traditional fuel sources, which increase prices in the short term, and lawmakers and citizens alike approach the idea of increasing costs for energy with great trepidation. (This is why subsidies and other incentives are common in pro-renewable policy.) While this is true irrespective of the broader economic context, it is particularly difficult to justify during times of economic hardship. After the financial crisis in 2008, many lawmakers backed away from the ideas of a clean energy overhaul for the country or a price on carbon. With the economy crippled and Americans struggling to combat rising unemployment and decreasing home values, clean energy legislation was perceived as a luxury we could simply not afford, despite its macroscale cost savings over time.

But does it have to be that way? After the economy recovered (for some), many energy and climate policy advocates focused more on the economic benefits of adopting less carbon-intensive energy policies. Job growth in the design, manufacture, installation, and maintenance of these technologies as well as lowered energy costs due to enhanced efficiency, became the lead talking points in the conversations for the advancement of clean energy policy. These were certainly themes before the economic downturn, but now they represent a more pressing concern for Americans. One prominent example of this is the Inflation Reduction Act, for which the name speaks for itself. Even though it is as much a climate bill as an inflation reduction bill, it is (justifiably) couched in the language of economic and employment benefits, since they have a broader bipartisan appeal.

Uncertainty

Uncertainty is a characteristic of climate change impacts that comes up frequently. While scientists understand the anthropogenic forcing of the climate and can anticipate the types of responses the physical environment may exhibit, it is difficult to pinpoint exactly when and where a climate change impact will be felt and how severe it will be. This uncertainty surrounding the issue provides an opportunity for people and groups opposed to climate and energy reform to suggest the issue is not immediately pressing. Consider this: uncertainty over policy outcomes leads to more reactive -instead of proactive - policies, which are typically more expensive and less effective at addressing the problem. For climate change specifically, this is particularly problematic because, despite the uncertainty about some of the specifics, it is quite possible that if we're 'wrong' it is because we've underestimated the possible impacts and severity. 

What if? Cartoon of the Copenhagen Climate Summit suggesting that efforts to reduce climate change might make the world a better place, based on a 'hoax'. Presenter has a slide that says "Energy Independence, Preserve Rainforests, Sustainability, Green Jobs, Livable Cities, Renewables, Clean Water/air, Healthy Children, Etc". An audience member stands up and asks, "What if it's a big hoax, and we create a better world for nothing?"
Cartoon by Joel Pett run in USA Today right before the Copenhagen Climate Summit in 2009.

Credit: Joel Pett. "What if it’s all a big hoax, and we create a better world for nothing!” USA Today. December 13, 2009.

We've spent a lot of time this semester discussing the role of all scales of government in developing energy policy. But it should be clear by now that they aren't the only players. Industry plays a huge part in shaping policy of all kinds, and energy is certainly no exception. Let's take some time to explore the advantages and disadvantages associated with having industry involved with the development of energy policy. Collectively, we'll refer to anyone spending money to influence energy policy as the energy lobby.

How do they participate?

What does it really mean to be part of the energy lobby? It means working directly and indirectly with the nation's lawmakers in Washington to inform and influence the content and scope of legislation. This can take on many forms, from donating to campaign funds for candidates who support favorable policies to preparing brief documents to be distributed to committee members, to working with congressional staffers, to actually drafting language to be included in the text of legislative bills.

Why do they participate?

They have a lot at stake. In the case of energy policy, specifically, we are talking about billions of dollars, national security, and international relations. A commonly used metaphor for energy companies and their participation in energy policy (even policies that limit emissions or impose other restrictions) is that companies would rather be at the table than on the menu. If they are able to help inform the development of policy, they are more likely to ensure that the policies eventually adopted have less negative (or more positive) consequences for them, and it helps policy makers understand how policies will affect their businesses.

It's not rocket science - public policy, for better or worse, can have significant impacts on individual companies and entire industries. Lobbying can and does influence these policies, so lobbying is seen as an investment that can provide returns. 

Political advantages to participation

Recall that as previously noted, legislators cannot be expected to be experts on energy, education, health care, homeland security, the environment, and any other number of issues that are impacted by their policy decisions. Instead, politicians rely on experts in the field to provide them with accurate, complete information as they try to navigate policy alternatives and options. Experts such as private industry executives, scientists, environmentalists and many others participate in this process. They play an important role in educating legislators and allowing them to focus on passing policies (and getting re-elected).

Disadvantages to participation

Of course, no action taken by any individual or company is done in a vacuum. Everyone has motives and goals, and sometimes these do not align with policy development goals. For example, if Congress considers decreasing a subsidy to oil companies, citing recent profits as a demonstration that the subsidy is no longer needed, lobbyists from oil companies will likely lobby against it. There is also the risk of "regulatory capture," which is when corporate (or rarely, other than corporate) interests have such an outsized influence on a regulatory agency that the agency creates regulations that favor the outside interest instead of achieving the agency mission. This has more to do with the application of policy, but is a consideration for lawmakers when crafting a bill as well. It is such a widespread problem that Sheldon Whitehouse introduced a federal bill to prevent it in 2011. (It never made it out of committee, unsurprisingly.) There are also organizations such as the American Legislative Exchange Council (ALEC), a libertarian (and anti-renewable) non-profit that exists primarily to write legislation that they would like adopted word-for-word by legislators at all levels of government, to varying degrees of success.

All of this speaks to why it is important for legislators to seek the advice and input of many diverse interests as they develop policies. Simply letting the companies and organizations with the loudest voices (which translates to the deepest pockets) have the final say in how policies are structured does not result in beneficial or effective policy — energy or otherwise.

In this lesson, we've talked about the factors influencing the development and change of energy and climate policy. 

Important Concepts to take away from this lesson

Hopefully, this content has you thinking about the advantages and disadvantages of industry's involvement in the development of policy. Without their expertise and insight, it might be difficult to construct policies that are realistic, feasible, and achieve the desired results. The other side of that coin, however, is that industry stakeholders bring to the table their own agendas and motives, many of which are (understandably) self-serving, not altruistic. So, where and how we draw the line on industry's policy influence is a real challenge.

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