Governments must subsidize renewable energy to combat climate change
The article discusses climate policies when the carbon price is too low. When the price of carbon emission is less than ideal, governments may use different tools, like subsidies for renewable energy, to help combat climate change. The researchers also looked into why these low tax rates might happen. Even if taxes are set well now, governments can't promise future tax rates. In some cases, giving subsidies to renewable energy projects may be needed because of this uncertainty.