Known as the Yale Carbon Charge
, the initiative is directed by Casey Pickett
’11 M.E.M./M.B.A., former director of innovation for Connecticut’s Department of Economic & Community Development.
Pickett, who will discuss carbon pricing during a panel event at the COP23 climate conference in Bonn, Germany, says a recent pilot version of the initiative showed that carbon pricing is both politically and economically feasible.
In an interview, Pickett discusses how the initiative aims to change behavior across campus, the broad range of research opportunities made possible by the initiative, and how it might ultimately be applied by other organizations.
Where did the Carbon Charge project come from?
It originated with Professor Bill Nordhaus, a world-renowned environmental economist here at Yale and a primary leader in developing the “social cost of carbon,” which is an estimate of the cost of global damages from an additional ton of carbon dioxide emitted, in real dollar terms.
Then, a few years ago, when Professor Nordhaus was asked during an Earth Day panel, ‘What else could Yale do as a leader on climate change mitigation?’, he suggested that the university consider implementing an internal price on carbon or a carbon charge. After that a group of students, led by Jennifer Milikowsky, took that idea and ran with it
, playing an integral part in proposing the idea and supporting the Presidential Task Force that studied the concept. The task force, created by Yale President Peter Salovey, recommended testing the carbon charge with pilot project on campus, which began during the fall of 2015.
What were the results of the pilot?
Twenty representative buildings were selected from a range of administrative units around campus and randomly assigned one of four approaches to carbon pricing. One group was simply provided an energy report; each month they learned how much energy they were consuming — and how much they would have been charged under a carbon charge plan. The other three treatment groups received those reports too. But one group also received additional money to invest in energy conservation measures if they chose. Another group received an incentive such that if they achieved a 1 percent reduction compared to their historical emissions — or did better than that — they’d receive money; if they didn’t they’d have to pay. The last group participated in what is called a revenue neutral carbon scheme: if a building did better than the average building in the treatment group they received funds; if they did worse than the average they’d have to pay.
We learned that all four scenarios were both politically feasible and administratively workable. Deans and staff were receptive and engaged... It was particularly useful to learn that you don’t have to pick one specific approach when pricing carbon. There’s a wide range of possibilities you can try.
A big part of the scheme is providing incentives for individuals and groups to change their behavior and try new things. As you now expand this into a campus-wide initiative, how are different schools and leaders convincing people to try new things?
We have seen a range of approaches. The energy reports go to the lead administrator, operations manager and facilities superintendent associated with each building. And those reports make salient the energy costs for each building — as well as the additional carbon charge amount each is responsible for. And by showing information one would not otherwise see (including those additional carbon charge costs) and by knowing that other people are getting similar information, it leads people to wonder how they’re doing in comparison. Research shows that peer comparison is one of the most powerful motivators we know.