Fossil Fuel Risk Bonds - National Campaign With Strategic Partners
CSE’s Fossil Fuel Risk Bond program is having an impact on the ground. As a result of successful research and advocacy in the Pacific Northwest, we now have policy templates that can be used at the state and county level in every US county that has a significant concentration of fossil fuel infrastructure. In addition, the work has been publicized by Brookings Institution, which will greatly enhance our ability to spread the model. In 2025 and 2026, we seek support for a joint campaign with Physicians for Social Responsibility to achieve three overriding outcomes: (1) ensuring that FFRB programs in Oregon and Washington are implemented in the strongest possible fashion; (2) having a model national FFRB program proposed and introduced in the 119th Congress, and; (3) persuading several jurisdictions to consider FFRB programs as a way to finance climate adaptation, as demonstrated in our new report with researchers at the University of Oregon and Reed College.
Purpose: In 2016 Center for Sustainable Economy proposed a commonsense solution for addressing the market failures associated with fossil fuel infrastructure – fossil fuel risk bond (FFRB) programs. Climate change is one, a market failure of breathtaking proportions. Add to that the market failures associated with fossil fuel infrastructure itself – the vast network of coal mines, oil and gas wells, pipelines, refineries, oil trains, LNG trains and fossil fuel export terminals that cause expensive physical damages to land, air, water and frontline communities. Air pollution and climate change caused by fossil fuels generate externalized damages of $2.2 – $5.9 trillion per year in the US, and by 2100, the Network for Greening The Financial System predicts a hit in the order of 3 – 10% of GDP each year. Fossil fuel risk bond programs are tools that regulators can use to begin to address these staggering externalized costs.

• Investigates the causes of economic imbalances.
• Investigates causes tending to destroy or impair the free-market system.
• Explores and develops market-based solutions.

US Forest Carbon Pricing Initiative 2025-2026
In 2025 and 2026 CSE seeks support to extend our work on forest carbon pricing and market-based solutions to deforestation and forest degradation by (1) advocating for a no-net-forestland-loss policy in key land use planning processes; (2) continuing to publicize and disseminate our peer reviewed paper and model legislation for a forest carbon tax and reward program; (3) researching and advocating for carbon border adjustments both in the US and internationally that include a price on forest carbon; (4) building strategic alliances with wood alternative industry leaders to help combat logging subsidies and timber industry disinformation, and; (5) defending and extending legal victories holding public agencies accountable for the social cost of forest carbon emissions under state environmental policy acts.
Purpose: Climate change has been referred to as the most spectacular market failure ever. The market’s failure to incorporate the costs of climate change into prices of wood and paper products supports a tremendous level of over-production, over-consumption, and wasteful uses of these commodities. Putting a price on high-emissions logging operations is a critical market-based solution for internalizing the catastrophic costs associated with climate change and rebalancing markets to support efficient use of energy resources, forestlands, and wood products. With respect to forestlands, CSE has pioneered the development of several market-based policy interventions that decision makers can use to help expedite the transformation of industrial forest practices to climate smart alternatives. These include forest carbon tax and reward, subsidy reform, cap and invest, no net loss and climate resiliency plans for large owners.

• Investigates the causes of economic imbalances.
• Investigates causes tending to destroy or impair the free-market system.
• Explores and develops market-based solutions.

Fossil Fuel Risk Bonds – Enforcing new legislation and promoting adaptation surcharges
CSE’s Fossil Fuel Risk Bond program is having an impact on the ground. New legislation in Oregon establishes a financial assurance requirement for large fuel terminals to guard taxpayers against the costs and risks of explosions, spills, and accidents. In Washington, new rulemaking provides an opportunity to strengthen FFRB laws we helped get on the books in 2022. In several states, climate superfund legislation is providing a forum for CSE to propose an alternative approach based on the adaptation surcharge mechanism we researched in our Brookings.edu report and the report we published in Oregon with the Forum on Oregon Climate Change Economics (FORCE). This grant cycle, we seek to achieve three key outcomes: (1) Oregon’s new fossil fuel risk bond bill is implemented in the strongest possible fashion; (2) fossil fuel risk bond rules are updated in Washington to cover all taxpayer costs, and (3) several jurisdictions consider FFRB surcharges to finance climate adaptation.
Purpose: In 2016 Center for Sustainable Economy proposed a commonsense solution for addressing the market failures associated with fossil fuel infrastructure – fossil fuel risk bond (FFRB) programs. Climate change is one, a market failure of breathtaking proportions. Add to that the market failures associated with fossil fuel infrastructure itself – the vast network of coal mines, oil and gas wells, pipelines, refineries, oil trains, LNG trains and fossil fuel export terminals that cause expensive physical damages to land, air, water and frontline communities. Air pollution and climate change caused by fossil fuels generate externalized damages of $2.2 – $5.9 trillion per year in the US, and by 2100, the Network for Greening The Financial System predicts a hit in the order of 3 – 10% of GDP each year. Fossil fuel risk bond programs are tools that regulators can use to begin to address these staggering externalized costs.

• Investigates the causes of economic imbalances.
• Investigates causes tending to destroy or impair the free-market system.
• Explores and develops market-based solutions.

US Forest Carbon Pricing Initiative
In 2026 and 2027 CSE seeks support to extend our work on forest carbon pricing and market-based solutions to deforestation and forest degradation by (1) advocating for a no-net-forestland-loss policy in Oregon to respond to new opportunities contained in Governor Kotek’s Executive Order 25-26; (2) drafting and promoting model forest carbon tax and reward legislation in multiple states; (3) building on legal victories in Washington State to ensure that all market and non-market benefits and costs are factored into new “alternatives analyses” being prepared for every large timber sale, and (4) with researchers at the University of New Mexico, preparing a peer-reviewed paper documenting the socio-economic costs of unsustainable logging activities across the US.
Purpose: Climate change has been referred to as the most spectacular market failure ever. The market’s failure to incorporate the costs of climate change into prices of wood and paper products supports a tremendous level of over-production, over-consumption, and wasteful uses of these commodities. Putting a price on high-emissions logging operations is a critical market-based solution for internalizing the catastrophic costs associated with climate change and rebalancing markets to support efficient use of energy resources, forestlands, and wood products. With respect to forestlands, CSE has pioneered the development of several market-based policy interventions that decision makers can use to help expedite the transformation of industrial forest practices to climate smart alternatives. These include forest carbon tax and reward, subsidy reform, cap and invest, no net loss and climate resiliency plans for large owners.

• Investigates the causes of economic imbalances.
• Investigates causes tending to destroy or impair the free-market system.
• Explores and develops market-based solutions.

Strengthening Climate and Energy News Coverage in the Mountain West
This grant will expand high quality climate and energy news coverage in the Mountain West.
Purpose: This project will strengthen news coverage of the most important environmental issues in the Mountain West, including water, public lands, energy development and taxation, coal and mineral mining, carbon capture, clean energy, conservation and biodiversity, and state and federal politics and the way they are impacting the region’s residents. In shining a light on the issues we will also pay close attention to the unique ways that the West can play a role in mitigation and adaptation through agriculture, landscape restoration, clean energy development and more - that is, unless politics get in the way. With your support, our work will create a consistent local conversation that captures attention in and outside the region, and provokes action around vital issues of human and environmental health otherwise invisible, misunderstood, or ignored.

• Investigates the causes of economic imbalances.

Symbiosis: A forest that creates markets; markets that safeguard the forest
The Children's Eternal Rainforest, owned by the Costa Rican nonprofit Monteverde Conservation League, provides diverse and massive benefits to people on local, national, and international scales (see below). To date, however, recognition of those services – particularly in the financial realm – has been inadequate. This project aims to create a new staff position, the exclusive purpose of which will be to (a) reach out to diverse stakeholders and stimulate reflection about why they are stakeholders, (b) explore and implement mechanisms through which stakeholders are incentivized to contribute reciprocal financial support, and (c) produce a publication that summarizes the lessons obtained from this initiative as a useful reference for others.
Purpose: Costa Rica has the potential to harness the enormous power of an ecotourism economy to support conservation in a mutually beneficial synergism. This has been achieved in some ways but the mutualism is often lopsided: financial benefits received by protected areas are often grossly inadequate in relation to the benefits they provide. The CER is crucial to a wide spectrum of economic activities (ecotourism, agriculture, hydroelectricity production) but MCL does not currently receive income from most tourism visitors, due in part to the relative inaccessibility of most of the CER but also to inadequate publicity about the CER and its importance. Exploring and developing ways to increase reciprocity between the CER and the economic activities it has played a large role in creating represents an exemplary market-based solution to a challenge faced by MCL and initiatives worldwide. In our case, a symbiosis between a forest that creates markets, and markets that safeguard the forest.

• Explores and develops market-based solutions.

Wind River Reservation Grazing Permit Retirements 2025/2026
The National Wildlife Federation’s (NWF) Wildlife Conflict Resolution (WCR) program resolves conflicts between wildlife and livestock through the market-based approach of compensating ranchers for retiring high conflict grazing leases on federal land. Thanks to over a decade of funding from the Walker Foundation, we have retired over 100 grazing allotments totaling over 1.7 million acres. In 2017 NWF launched the WCR Southern Rockies, Colorado Plateau and Great Basin program, and we recently piloted a new strategy in Grand Staircase-Escalante National and Bears Ears National Monuments in southern Utah that included "AUM buy-downs," and the full retirement of grazing allotments. In 2024, we began a new WCR venture by assisting NWF’s partner the Wind River Tribal Buffalo Initiative (WRTBI) to negotiate with Wind River Reservation Range Unit grazing permit holders in an effort to open up areas for the Reservation’s Buffalo program. This work will be the focus of this application.
Purpose: Beginning in 2003, NWF began using a market-based approach that recognized the economic value of public land grazing permits and offers to compensate ranchers for waiving their permit. We then receive assurances from the public land management agency that the allotment will not be restocked with livestock. In an effort to apply our model to new landscapes and to continue to innovate, we will adapt our allotment retirement model on the Wind River Reservation by adapting to the Bureau of Indian Affairs’ allotment rules, increased engagement with Tribal members, and ensuring the range units are able to be converted to buffalo once the cattle permits are waived.

• Explores and develops market-based solutions.

Successfully Decarbonizing New England's Electric Grid
This project will use the CACI software to investigate how the New England Region can successfully decarbonize their electric grid using nuclear power. The project will create new roadmaps showing how the region can reduce its dependence on fossil fuels. The education/advocacy group Eco-Nuclear Solutions will use these results to change the debate in New England over its energy future.
Purpose: Climate change induced by the burning of fossil fuels is imposing added costs on the world economy. Cost-effective decarbonization of the electric grid is one of the major ways in which this harm can be reduced. This project provides clear persuasive evidence that intermittent renewable sources cannot accomplish what is needed, while nuclear power can meet the requirements of the grid. Further extensions of this work, under the heading of "Beyond Electrification", will show that the use of nuclear power to produce carbon-neutral synthetic fuels is a far more practical and cost-effective approach to decarbonization than attempting to electrify all applications of fossil fuels.

• Investigates causes tending to destroy or impair the free-market system.
• Explores and develops market-based solutions.

Support Youth in Legal Actions to Stabilize Climate
Our Atmospheric Trust Campaign is built on the belief that everyone has a fundamental right to a healthy atmosphere and a stable climate. Through legal action and public education, we aim to establish a constitutional standard for climate stability, holding governments accountable to reduce CO2 below 350 ppm by 2100 – a threshold aligned with the scientific threshold for a safe climate within Earth’s planetary boundaries. Rooted in science and justice, our mission is to protect current and future generations from the devastating impacts of climate destabilization.
Purpose: We are investigating and addressing the root causes of global economic imbalance, with a focus on climate. Currently, society fails to accurately price the damages caused by climate-destabilizing activities and products, ignoring both present and future harms. This creates significant economic distortions. We are exploring and advocating for market-based solutions that promote a sustainable economy, addressing issues like ecosystem services, climate change, energy security, and food production. Carbon-intensive industries and outdated government policies dominated by the fossil fuel industry continue to dominate, worsening environmental degradation. Our goal is to secure court orders requiring governments to correct these imbalances, and create a just, sustainable economy aligned with scientific mandates to stabilize the climate system and de-acidify oceans.

• Investigates the causes of economic imbalances.
• Explores and develops market-based solutions.

Atmospheric Trust Campaign
Our Atmospheric Trust Campaign pursues constitutional litigation on behalf of youth in state, federal, and international courts to establish enforceable legal standards requiring governments to price the true costs of fossil fuel dependence—correcting the economic imbalances that have allowed carbon-intensive industries to externalize massive health and climate costs onto children and future generations while revenues flow elsewhere. Legislation can be repealed. Regulations can be reversed. Constitutional rights cannot—which is why this is the only approach that can produce durable, market-correcting climate protection that outlasts political cycles and safeguards future generations.
Purpose: We investigate and address the root cause of global economic imbalance: the systematic failure to apply the "polluter pays" principle to climate damages. Governments have affirmatively built systems that promote and subsidize fossil fuel extraction, allowing carbon-intensive industries to externalize true costs onto children, communities, and the ecosystems on which all economic activity depends. Fossil fuel subsidies confer an unfair competitive advantage, deepening harm to those least able to absorb it—the youngest generation, who have no vote and no recourse except the courts. Our work will lead to court orders requiring governments to correct these pricing failures—establishing children's enforceable right to a stable climate while creating legal frameworks that incentivize market-based solutions. When courts compel governments to price pollution, markets deliver the most efficient path to reduced emissions and a livable future.

• Investigates the causes of economic imbalances.
• Investigates causes tending to destroy or impair the free-market system.
• Explores and develops market-based solutions.

Engaging Diverse Stakeholders on Issues Concerning Carbon Pricing Policies
In 2025, the Pricing Carbon Initiative (PCI) will continue to build support for bipartisan carbon pricing policy solutions, designed to drastically reduce greenhouse gas emissions, by fostering understanding and cooperation between a wide range of organizations and opinion leaders. That work will include in-person and virtual Pricing Carbon Dialogues, public forums, a special project that focuses in carbon border measures, and disseminating information via PCI's website.
Purpose: 1) PCI focuses on policies that correct the economic distortions resulting from the free dumping of carbon pollution into Earth's atmosphere and oceans.
2) While focusing on U.S. domestic legislation, we address design elements that transparently link with a global carbon pricing system and foster global economic sustainability.
3) A robust economic consensus suggests the need to price in the externalities associated with fossil fuel burning. Otherwise, the costs of climate change threaten to undermine global economic stability.
4) Policies to price carbon pollution take advantage of existing energy markets to correct price signals in the use of fossil fuels that ignore the social costs of carbon. Negative externalities not included in prevailing models, such as the acidification of oceans, must be included in the mix. Pricing carbon emissions can correct the distortion in energy markets whereby fossil fuels are favored over low-carbon alternatives.

• Investigates the causes of economic imbalances.
• Investigates the effect of the global financial system and/or the monetary system in fostering a sustainable economy.
• Investigates causes tending to destroy or impair the free-market system.
• Explores and develops market-based solutions.

Unlocking Water Markets in the American West
PERC is developing a comprehensive analysis of water market policy across Western states, with a focus on the state-level barriers and opportunities that can enable voluntary water conservation to function at scale. The report will examine the legal, institutional, and market conditions that shape water transactions across the West, including instream flow rights, short-term leasing, challenge and objection processes, transfer infrastructure, and water banking systems. Through a comparative state-by-state analysis, the project will identify where elements of water markets are functional, where barriers remain, and what targeted reforms could unlock broader participation from private landowners, conservation organizations, and water users. The findings will provide policymakers with actionable recommendations to support more scalable and incentive-driven approaches to water management across the Colorado River Basin and other water systems.
Purpose: This project explores and develops market-based solutions to Western water scarcity by identifying state-level policy reforms that can improve water markets, reduce barriers to voluntary water transfers, and better align incentives for conservation. Through comparative policy analysis and research, the project seeks to advance scalable, incentive-driven approaches that enable more flexible and effective water management.

• Explores and develops market-based solutions.

Engaging Diverse Stakeholders on Carbon Pricing Policies
Based on the premise that some form of carbon pricing is essential to limiting greenhouse gas emissions to tolerable levels, the project organizes dialogues, public forums, and special projects on carbon pricing policies to build understanding, alliances, and fresh perspectives. The central effort of the project is the Carbon Pricing Dialogues (CPD), a forum for discussions between a broad spectrum of stakeholders on potential pricing mechanisms and strategies. Participants represent environmental, business, labor, social justice, religious, and other issue-oriented advocacy organizations, as well as both conservative and progressive think tanks.
Purpose: 1) Causes of economic imbalances: We focus on policies to correct the economic distortions resulting from the world's most significant market failure—the free dumping of carbon pollution into Earth's atmosphere and oceans.
2) The global financial system’s effect in fostering a sustainable economy: While focusing on US legislation, we discuss ways to link with global pricing systems and foster global economic sustainability.
3) Threats to the free-market system: A robust economic consensus suggests the need to price in the externalities associated with fossil fuel burning. Unless these costs are integrated into energy markets, the costs of climate change threaten to undermine global economic stability.
4) Market-based solutions: Policies to price carbon pollution will take advantage of existing energy markets to correct price signals in the use of fossil fuels that presently ignore the social costs of carbon, and unfairly favor fossil fuels over low-carbon alternatives.

• Investigates the causes of economic imbalances.
• Investigates the effect of the global financial system and/or the monetary system in fostering a sustainable economy.
• Investigates causes tending to destroy or impair the free-market system.
• Explores and develops market-based solutions.

Nuclear Energy Innovation
The key priorities of Breakthrough’s Nuclear Energy Innovation Program include public advocacy for nuclear energy; comprehensive regulatory engagement at the NRC; Congressional engagement, inclusive of both congressional oversight of NRC and ongoing policy support for nuclear commercialization; and research and policy development in support of regulatory reform and public and private efforts to deploy advanced nuclear reactors.
Purpose: The key priorities of Breakthrough’s Nuclear Energy Innovation Program include public advocacy for nuclear energy; comprehensive regulatory engagement at the NRC; Congressional engagement, inclusive of both congressional oversight of NRC and ongoing policy support for nuclear commercialization; and research and policy development in support of regulatory reform and public and private efforts to deploy advanced nuclear reactors.

• Explores and develops market-based solutions.

A Carbon Tariff (CBAM) in the U.S. – A path forward after the 2024 election
Project will explore the feasibility of a carbon tariff in the U.S. after the election.
Purpose: Climate change is one of the most important challenges mankind is facing and it is therefore important to find ways to address it through regulation and harnessing the power of markets. The Center on Regulation and Markets (CRM) at the Brookings Institution proposes a project that would build on our previous workshop held in-person at Brookings on April 11 discussing how the U.S. could implement a CBAM (generously funded by the Walker foundation). The workshop was a great success and has spurred numerous follow-up conversations, and ideas and potential initiatives within the expert community that attended the workshop.
We propose a full day in-person workshop at Brookings after the 2024 elections to further discuss what a path forward would look like in the U.S. for a carbon tariff within the newly constituted Congress and Presidential Administration. We believe that this is critical work as the chances for a carbon tariff in the U.S. are higher now than ever before.

• Explores and develops market-based solutions.

Carbon tariffs, AI, and climate
Project will further advance the Center on Regulation and Markets (CRM) at the Brookings Institution’s work on carbon tariffs in the U.S. and launch new work on AI and energy.
Purpose: Climate change is one of the most important challenges mankind is facing, and it is therefore essential to find ways to address it through regulation and harnessing the power of markets. The Center on Regulation and Markets (CRM) at the Brookings Institution proposes a project that would consist of two parts: (1) Further advancing work on a U.S. carbon tariff, and (2) Al, climate, and energy. The first part would focus on how a carbon tariff would be an efficient way to address the market failure caused by greenhouse gas emissions (i.e., find a remedy for impaired markets) while bringing the U.S. in line with similar international measures. The second part—AI, climate, and energy—would focus on meeting the energy demands of an emerging AI sector without undermining U.S. climate goals. CRM proposes to explore these topics through a combination of stakeholder briefings as well as a full-day, invite-only workshop that emphasizes policy approaches that support robust private markets.

• Explores and develops market-based solutions.