ABSTRACT
This chapter outlines how a well-targeted set of climate policies, including those targeted directly at science and innovation, could help lower the overall costs of mitigation. Substantial reductions in US greenhouse gas (GHG) emissions will require large-scale innovation and adoption of GHG-reducing technologies throughout the US economy. A coupled 'emissions price plus research and development (R&D)' strategy, offers the best opportunity for mitigating GHG emissions at the lowest possible cost to society. The proposed strategy thus has two main parts to directly confront these two market problems: establish a price on GHG emissions through a carbon tax or market-based trading system, supplemented by permanent tax credits for all R&D, and increase public funding for basic strategic research inspired by critical, climate-related needs. The Advanced Research Projects Agency-Energy (ARPA-E), is the natural foundation on which to further build that program, where appropriate in cooperation with other key funding agencies such as the National Science Foundation, Department of Defense, and Agriculture.
