Where markets do not fully recognize the environmental benefits of increased energy efficiency, voluntary programs can help create incentives for technology development, stimulate energy-efficiency investments, and disseminate information. Voluntary programs have emerged as a key tool in addressing environmental problems without statutory mandates. For example, carbon dioxide is the dominant greenhouse gas, but is not currently subject to regulatory requirements. The Administration has pioneered a voluntary market approach to reduce greenhouse gas emissions cost-effectively. Climate Change Action Plan.
Climate change raises complex environmental and energy issues.
It also offers an opportunity for new approaches, because few Federal regulations limit greenhouse gas emissions. The Climate Change Action Plan initiated a host of voluntary programs, including Climate Challenge and Climate Wise, that will reduce greenhouse gas emissions and boost productivity and profits. Under this voluntary program, which was developed jointly by the Department of Energy and the electric utility industry, utilities agree to reduce, avoid, or sequester greenhouse gas emissions using flexible individualized plans to achieve the reductions in the most cost-effective way. The program recognizes that utilities are in the best position to determine how to reduce emissions cost-effectively in their own systems. Climate Wise, which is being carried out by the Environmental Protection Agency and the Department of Energy, is designed to stimulate industrial emission reductions.