Addressing Climate Change and Equity Concerns in Denver
In November 2020, residents of Denver, Colorado voted to increase the local sales tax by 0.25 percent to support efforts to address climate change. The measure, which is expected to raise $30-40 million a year, did not specify how the new tax revenue must be spent to achieve climate goals. However, it did require that 50 percent of the new climate funding must also improve equity in Denver.
The task of implementing this ambitious agenda fell to Denver’s Office of Climate Action, Sustainability & Resiliency (CASR). Although CASR had been working on ambitious local climate change programs for many years, the ballot measure substantially increased their annual funding, and when it passed, CASR did not have a rigorous process for evaluating programs and allocating resources at such a large scale.
In “Equitable & Effective Climate Change Mitigation” (our Policy Analysis Exercise – the Harvard Kennedy School’s equivalent of a master’s thesis), we developed a consistent, formalized process that CASR can use to evaluate potential programs and thoughtfully allocate new funding. This project, which was named this year’s best student paper on housing by the Center, is the result of a year-long collaboration with CASR.
We focused our efforts on building a flexible, customizable funding screening tool that CASR could implement across their very diverse teams, sectors, and programs. The screening tool, which was intended to support CASR’s long-term decision-making processes, has two main components: Greenhouse Gas (GHG) Policy Lever Modeling and a Climate Equity Framework.
- The GHG Policy Lever Modeling tool is a flexible, user-input-driven calculator that CASR can use to analyze the GHG emission reduction potential of different approaches in three different sectors: transport, buildings (including residential, commercial, and industrial), and energy.
- The Climate Equity Framework is a five-step process that merges key quantitative and qualitative analyses to help CASR evaluate different policies’ impact on distributional, recognitional, and procedural justice.
This framework could make it clear, for example, that providing incentives for households to switch from gas heat to electric heat pumps could have relatively large impacts on GHG emissions but may do little to address equity concerns, depending on the specific program design decisions. In contrast, it might show that incentives for weatherization (i.e., improving insulation in homes) could further equity goals significantly but may have a smaller impact on GHG emissions. Based on our tool’s capabilities and our findings, we recommended that CASR:
- Use our screening tool to compare program impacts consistently and transparently, and allocate funding resources accordingly;
- Consider the overall impact of a policy portfolio rather than that from an individual policy;
- Balance tradeoffs between metrics based on which are most important to maximize in order to achieve CASR’s goals; and
- Implement high climate and equity impact programs to guarantee short-term progress.
Such efforts are critically important. Every level of the United States government is currently working to address the intersection of climate change and equity priorities, with no perfect solution for balancing these key needs. Given this context, Denver has the opportunity to further establish itself as a leader in this space by integrating climate and justice efforts through a concrete, actionable approach that merges key quantitative and qualitative analyses. Through this approach, it becomes clear that tradeoffs need to be made using a consistent methodology that is flexible enough to handle diverse programs and policy types and transparent enough to help build community trust in programs.