State Rep. Jeff Hoverson didn’t want anyone getting in the way of using fossil fuels in North Dakota. Not the United Nations. Not international nonprofits. Certainly not the Intergovernmental Panel on Climate Change. So he made a law to stop them. In March, the North Dakota legislature passed a bill that Hoverson co-authored with a state senator. It’s short, sweet and to the point: “A climate control-related regulation of an international organization, either directly through the organization or indirectly through law or regulation, is not enforceable on this state.”
Hoverson told me he isn’t sure what that will mean the next time the federal government wants to sign a climate treaty. Frankly, he’d prefer the feds not have that kind of power, anyway. But while his law stands out for the scope of its ambitions, it’s not exactly an outlier in its spirit. Across the country, bills pushing back against climate policy have been a trend this legislative session, with multiple states proposing — and passing — laws that would undermine efforts to limit greenhouse gas emissions.
Some of the laws aim to support the oil and gas industry in various ways, such as a bill in Indiana that amends clean-energy incentives for utility companies to include building natural-gas power plants as long as they can be said to displace coal, or another in Kentucky barring conservation easements in the state from infringing on the activities of oil and gas industries. Others have taken the form of preemption laws, barring cities and other regional governments from setting more stringent environmental regulations than the surrounding state. This includes laws preventing bans on gas stoves and requiring municipalities to include natural gas as a source of clean energy, as well as bills that would prevent them from banning the use of certain refrigerants before the federal government does.
None of this is exactly good Earth Day tidings. And, more importantly, this legislation highlights what a mess American climate policy is. These laws pit different branches of government against each other, roll back some environmental protections established in legislation of years’ past and, in the case of North Dakota, create laws to prevent things that are not currently happening and likely wouldn’t be enforceable if they did. Meanwhile, plenty of other states are introducing and often passing bills that do directly or indirectly reduce greenhouse gas emissions. The result is that predicting the near-term future of environmental regulation in this country is really hard. And that, economists say, can end up making it more expensive — and less appealing — to reduce emissions.
“You can look at the EPA website and see all of what they’re opposed to … carbon, methane. All these things directly affect … our major industries in our state, our oil industry, our ag[ricultural] industry,” Rep. Hoverson said.
And that’s why it shouldn’t be a big shock to see legislation that pushes back against climate regulations, especially legislation that promotes the oil and gas industry, said Michael Oppenheimer, director of the Center for Policy Research on Energy and the Environment at Princeton University. “The dominant firms … they’re not going to lie down and play dead,” he said. “It’s a fight to the death, essentially, because companies, no matter how big they are, they have a hard time becoming something else.”
Businesses dependent on fossil fuels want to keep doing the business they’ve always done and using the infrastructure they’ve already invested in, said Mark Agerton, a professor of agriculture and resource economics at the University of California, Davis. This is part of why environmental policy in the United States has moved away from “sticks” — such as putting a price on carbon or capping emissions — and toward “carrots” — such as incentivizing consumers to choose lower-emission energy in the form of subsidies and tax rebates, Agerton said.
But the experts I spoke with also said that climate policy has become a partisan playing field, bound up in identity and opposition — a way of drawing lines between “their” side and “ours.” For example, America has been a net energy exporter since 2019 and a net petroleum exporter since 2020, and oil and gas production in this country has largely been on the rise since 2008. Yet the Kansas Legislature passed a resolution calling for energy independence and for the Biden Administration to stop curtailing production of oil and gas.
Oppenheimer suspected that some momentum on these kinds of bills comes from opposition to the Inflation Reduction Act. The IRA included large amounts of money earmarked for grants, loans and rebates to promote clean energy — preferential treatment that people like Rep. Hoverson see as harming important fossil fuel industries on the basis of false science. As a possible response, many of the bills passed or moving through state legislatures are strongly supportive of natural gas. A North Dakota resolution asked the federal government to acknowledge natural gas and nuclear power as environmentally sustainable. A recent West Virginia law expands and promotes the use of natural gas for generating electricity. And a new law in Tennessee requires any municipality that wants to set clean-energy mandates to include natural gas as one of the options.
The idea of natural gas as clean energy has some background in science, said Anthony Patt, a professor of environmental systems science at the Swiss Federal Institute of Technology in Zürich. “Ten or 15 years ago, our ambitions were more modest than they are today. With that thought in mind, natural gas seemed like a great thing,” Patt said. Natural gas was seen as a way to reduce emissions, compared to coal or fuel oil, he told me. And it does — but not as much as once anticipated, nor as quickly as needed to meet greenhouse-gas-reduction targets. Because of this, Patt said, energy modelers have moved on to figuring out how to run stable electrical grids without natural gas.
Regardless of where the competing ideas about environmental policy come from, the result is a volatile political world where even companies that want to make environmentally friendly choices can’t count on knowing what will or won’t be supported, said Kevin Novan, a professor of agricultural and resource economics at the University of California, Davis. And that seems to be increasing the cost of building more sustainable infrastructure.
The basic idea is that when companies don’t know what the government will require, there’s an incentive to be small-c conservative: to invest less, and to not make any bold moves that could be hard to undo later. In other words, uncertainty can make the hard, long, expensive process of energy transition even harder and longer. This is in keeping with larger economic theories about policy uncertainty more broadly, Novan said, but in recent years, researchers have begun to apply it to climate policy.
Some companies already function as though climate policy limiting carbon emissions exists. One report, for instance, found that out of nearly 6,000 companies surveyed in 2020, 853 were already using an internal carbon price to help make decisions about future investments. And Novan’s own research found that when companies respond to uncertainty by setting these kinds of internal limits, you end up getting reductions in emissions as though a national carbon price really did exist. The catch: In Novan’s model, the same amount of emissions reduction costs more than twice as much to achieve this way as it would if there were a stable, consistent, national carbon tax in place.
But there is a silver lining, experts said. When carbon-reduction policy does hit some level of consistency, the incentives start to turn around and the safe bet becomes the one that reduces emissions in anticipation of future requirements. The American auto industry is a great example, Oppenheimer said. The sector has embraced electric vehicles, partly to keep up competition from Chinese companies and partly because of policy signals set by rising fuel-efficiency standards at the national level and in large markets like California. A Bloomberg analysis in 2022 found that electric vehicles now make up 5 percent of new car sales nationwide, up from 0.2 percent in 2011, as reported by the U.S. Bureau of Labor Statistics.
The growth of EVs shows the power of stable policy — even if at only a state level — to make new, green technologies cheaper and more widely available. When the national fuel-economy standards that had been set under President Barack Obama were rolled back during the administration of President Donald Trump, the car companies had a choice, Novan said. They could assume the rollbacks would be permanent, or they could guess that, in the long term, the nation would come to look more like California — a state that recently approved a regulation phasing out the sale of new combustion-engine vehicles by 2035. “[The car companies] erred on the side of being conservative,” Novan said. Only this time, conservative meant “green.” “Most of them went ahead and said, ‘We’re just going to stick with California’s fuel-economy standards.’”