Lessons from the French experience with voluntary agreements for greenhouse-gas reduction

The paper analyses the French experience with voluntary agreements (VAs) for the reduction of industrial greenhouse-gas (GHG) emissions. It is based on evidence from two case studies: the VAs signed by the main aluminium producer and by the packaging glass industry association. The analysis suggests that the considerable reductions in specific GHG emissions can hardly be seen as a direct consequence of the VA commitments. Instead they seem to have been triggered by other environmental regulations, and above all, by industry's heavy investments in technology modernisation and cost reduction efforts. Therefore, the observed reduction in specific emissions appears to correspond to industry's business-as-usual behaviour, suggesting that VA objectives were poorly ambitious. These results appear consistent with other VA evaluations. In the French GHG-related VAs, the failure to achieve more ambitious goals appears to result from the lack of a well-articulated policy-mix involving the VAs for GHG policy and energy efficiency promotion, as well as from policymakers' concerns over the potential competitive impact of GHG policy. The question of how to provide incentives for more ambitious GHG reductions without a high impact on firms' competitiveness remains a challenge for future policy.