The last few decades have seen the mainstreaming of a particular form of climate policy that puts a lot of faith in the mechanisms of the market. But do these mechanisms deliver what they promise? And what are the broader environmental implications of the choice for market-based policies? This dissertation argues for the need to take seriously the social, economic and ecological contexts within which such policies are deployed. Market mechanisms are not neutral instruments but in fundamental ways interact with the historical legacy of fossil fuel development and the broader socioecological conditions of capitalist society. Their outcomes cannot be understood outside of these contexts. Recognizing this offers insights on the conditions for improving current policies, or the formulation of alternatives.