How State and Local Governments Can Fight Climate Change

The United States has a federal system of government. The central, or federal, government has authority over the entire country, but in many areas, states can govern themselves. They, in turn, can delegate some decision-making to more local governments, in counties, cities, and towns. 

That means that governance and policymaking in the United States can be complex, but there are some benefits. States are often referred to as the “laboratories of democracy.” An innovative idea tried out in one state could inspire other states, and possibly the federal government, to adopt the same approach. 

That has happened with some environmental policies. For example, in 1976, California was the first state to adopt energy efficiency standards for appliances. Massachusetts and New York soon followed its lead. Then, seeing what parts of those policies were most successful, the federal government eventually rolled out its own National Appliance Conservation Act in 1987. 

Policy innovation and experimentation could be helpful in addressing climate change; however, the federal system poses certain challenges, too. 

This learning resource examines which climate action roles the federal government takes, which roles state and local government take, and what obstacles and opportunities the system presents. 

What does the federal government do to address climate change? 

The federal government has a lot of money. In 2022, it spent a total of $6.6 trillion. That’s more than twice as much as all the states’ spending combined. The large budget gives it a greater ability to take expensive climate actions, such as 

• funding the construction of energy infrastructure and climate adaptation projects, 
• subsidizing emissions-reducing behavior, 
• investing in research and development of new technologies, 
• hiring a large staff of technical experts who can inform policymakers and the public on climate threats and solutions, and 
• providing insurance against and assistance during climate disasters. 
   

The federal government also has authority to shape and coordinate U.S. climate actions beyond spending money. It can 

• set taxes to discourage emissions-producing behavior, 
• issue new standards and regulations to reduce emissions and lower the risk from increasing climate threats, 
• identify national emissions standards and targets, and 
• conduct foreign policy to coordinate international climate efforts. 

What do state and local governments do to address climate change? 

State and local governments can take many of the same climate actions as the federal government. They can build green infrastructure and subsidize emissions-reducing behavior. The main difference is that with fewer funds available and smaller areas of jurisdiction, state and local governments often approach those policies at a smaller scale. For example: 

• In 2018, voters in Athens, Ohio, adopted a carbon fee that residents would pay based on their electricity use. The revenue collected from the fee is set aside to fund local solar projects. 
• In Maryland, state legislation offers rebates to help residents and businesses cover the costs of installing electric vehicle charging stations. The state also provides a tax credit for buying electric vehicles. 
• In Texas, state lawmakers have approved plans for a system of coastal barriers nicknamed the Ike Dike. Named after Hurricane Ike, which struck the area in 2008, the system is designed to protect Houston and its surrounding areas from major hurricanes. 

Although states can take on climate projects themselves, they often do so with federal help. The federal government often helps states take on more ambitious projects than they could fund on their own. Take Texas’s coastal barrier project. Federal funding is slated to cover 65 percent [PDF] of the project’s estimated $34 billion price tag.  

The United States is geographically diverse, and different areas could benefit from different climate actions. Instead of directly prescribing what states should do, the federal government often dedicates a pot of money toward accomplishing a general goal under certain parameters. States and local governments can apply for that money in the form of grants by proposing ways to best use it to help achieve the federal government’s goal in their jurisdictions. For example, the federal government offers around $5 billion in Climate Pollution Reduction Grants. If states and local governments commit to developing and implementing plans to reduce emissions and other air pollution that fit within the grant program’s guidelines, then they can access that money to help fund their mitigation efforts. 
 

Even when the federal government isn’t providing funds, states can take meaningful climate action. Let’s explore some of the main ways they can do so. 

How states and the federal government control energy supplies 

Generally, the federal government has limited control over how states manage their energy infrastructure.  

Building some energy projects, like nuclear or hydroelectric plants, requires approval from federal agencies. Regulations can also influence states’ and utility companies’ behavior. Federal agencies regulate energy transmission across state lines, for example. This includes the construction of interstate power lines or oil and gas pipelines, as well the sale of electricity between companies in different states. Environmental regulations can also influence how utility companies operate power plants. Federal air pollution standards, for example, can limit how much of a certain pollutant power plants are allowed to emit.  

States, meanwhile, have broad control over how energy producers operate within their boundaries. Even in cases where federal agencies provide approval or regulation, state governments generally decide whether to allow or restrict the construction of new energy infrastructure. They also determine where to build it, and how to regulate utility companies within the state. 

States can use their control over energy policy to fight climate change. One strategy is to require utilities to generate a certain amount of their power through renewable energy. Such policies are known as renewable portfolio standards (RPS) or clean energy standards (CES). As of 2024, thirty-eight states and the District of Columbia have enacted some type of RPS or CES program. Those policies vary from state to state. In California, the state government requires that 60 percent of all the state’s electricity must come from renewable sources by 2030, and 100 percent by 2045. Ohio, by contrast, requires 8.5 percent of the state’s electricity to come from renewable sources by 2026.  

Congress has debated adopting a similar policy nationwide in the past. However, no national renewable standard has passed into law. 

How state control over land-use and construction affects climate action 

State governments exercise considerable control over how the land under their jurisdiction can be used and how buildings on that land can be constructed. Those decisions can help mitigate climate change and protect people from its harmful effects.  

Land can be set aside, or zoned, for specific uses, such as housing, commercial districts, industrial sites, parks and conservation areas, and more. By designating land for conservation, states can protect critical ecosystems such as coastal wetlands that help absorb the impact of storms. States can also limit or prohibit certain practices on their land such as drilling for oil or natural gas. Zoning decisions can also stymie climate action. According to one study, 15 percent of U.S. counties have adopted restrictions or outright bans on constructing renewable energy projects on their land.  
 

Climate-oriented zoning rules can create greener towns and cities, too. Some states and municipalities have adopted policies that encourage—or even require—higher-density residences and mixed-use communities that combine residences and commercial buildings. That helps reduce emissions and air pollution by enabling more people to meet their everyday needs by walking rather than driving.  

State and local governments can also establish building codes and set standards on how buildings can be constructed. Many state and local governments are updating their codes to help fight climate change by requiring that new buildings meet certain energy efficiency standards, like minimum insulation levels or window performance. Building codes can also require that buildings are more resilient to flooding or wind damage. 
 

How state lawsuits affect climate action 

State and local governments can sue the federal government, either to force climate action or to block it. 

In 2007, for example, Massachusetts, alongside several other states, sued the Environmental Protection Agency (EPA) for not regulating greenhouse gas emissions as air pollutants. The lawsuit resulted in a Supreme Court decision that greenhouse gases qualify as air pollutants and that the EPA had the authority to regulate them.  

States can also take legal action to block or slow federal climate policies. For example, in 2024, three states sued the EPA over a new regulation that would target air pollution that wafted from one state to another. If the lawsuit succeeds, it will overturn the rule. Even before the court issues its final ruling, however, the lawsuit prevents the policy from taking effect. So, it effectively stalls the EPA. 

How states and the federal government handle climate disasters 

Managing the risk of climate-related disasters and responding to them when they happen involves government action at all levels. 

States can influence how exposed residents are to disaster risks. For example, states can use zoning policies to restrict the construction of new buildings in a flood-prone area or require buildings in that area to incorporate certain resiliency features like elevation of structures.

If a disaster strikes, states can deploy resources and personnel, including the state national guard. If a state government lacks the resources to adequately respond, the federal government can step in. The Federal Emergency Management Agency (FEMA) provides access to funding and helps coordinate state efforts. It also deploys trained personnel such as medical experts or search-and-rescue teams to take part in disaster response. 

FEMA also helps residents recover from floods by providing federally backed flood insurance, which helps protect people in flood-prone areas. The insurance also gives FEMA a degree of influence in local land-use decisions that could reduce flood risk. The agency sets certain conditions on access to its insurance. For example, it could restrict development in flood-prone areas.  

Insurance against disasters is increasingly becoming an issue for state governments, too. As many types of natural disasters worsen due to climate change, the cost of their damage increases. In 2024 alone, the United States experienced 24 disasters that exceeded $1 billion in damage (the annual average from 1980 to 2023 was 8.5). Private insurance companies have raised premiums to cover the added risk. That makes insurance more difficult—or impossible—to obtain. In Florida, the average homeowner’s insurance premium doubled between 2020 and 2023. Floridians now pay more than three times the national average.  
 

States often regulate the prices insurance companies can charge. However, if the risks outweigh the revenue, then an insurance company could pull out of the area altogether. That was the case in California, where the country’s two largest insurers, Allstate and State Farm, stopped providing new home insurance policies in 2023. 

Some states have introduced government-backed “plans of last resort” to provide coverage for homeowners who cannot obtain private insurance. Those programs have grown increasingly popular. Florida’s state-backed insurer expanded its share of the market from 4 percent in 2019 to 17 percent in 2023. Some analysts worry that as state-backed insurance schemes grow, they risk incurring costs that states are unable to pay out. Such scenarios could end up requiring the federal government to step in and bail states out. 

Can states lead the way in the fight against climate change? 

States have considerable power to help—or hinder—the fight against climate change. Some states have advanced ambitious climate goals well beyond what the federal government has done. In economically powerful states, climate action can have ripple effects that extend to the whole country. In California, for instance, automotive fuel economy standards can push automakers to reduce emissions further than federal regulations require.  

States can also band together to implement climate actions in the absence of federal policy. After the Donald Trump administration withdrew the United States from the Paris Agreement in 2017, for example, twenty-four states, representing 60 percent of the country’s gross domestic product (GDP), formed the U.S. Climate Alliance, committing to continue pursuing the agreement’s goals. 

Still, the federal government’s ability to marshal vast amounts of resources, coordinate countrywide approaches, and cooperate with other countries around the world remains an indispensable tool in the fight against climate change. Meeting U.S. climate objectives will require action at all levels of government.