Climate club

A climate club is a coalition of the willing among countries that wish to adopt more stringent climate mitigation policies.

Sometimes the term is used loosely to refer to any such international climate alliance. However, the concept of a climate club has most famously been promoted in a stricter sense by William Nordhaus, winner of the 2018 Nobel Memorial Prize in Economics. In his conceptualization, the climate club introduces carbon pricing among the club's member states and levies a fee on all imports of goods from countries that are outside the club and have not introduced similar carbon pricing. This is expected to encourage more countries to join the club and introduce carbon pricing.

The idea of a climate club has been criticized by countries that fear the imposition of fees on their exports as well as by researchers who are skeptical of carbon pricing in general. Others have argued that some of the supposed losers, such as China and India, will actually gain from a climate club and the resulting introduction of carbon pricing.

The EU's Carbon Border Adjustment Mechanism (CBAM) has been labeled as the possible beginning of a climate club. Others see CBAM as too narrow to function as a climate club.

German Chancellor Olaf Scholz has proposed that the EU initiate the formation of a climate club. His proposal has been criticized as vague.