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AbruptSLR

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Carbon Fee & Dividend Plan
« on: November 19, 2014, 08:40:16 PM »
The link discusses a new bill introduced in the US Senate for a carbon fee and dividend plan that might garner bi-partisan support (see extract below):

http://thinkprogress.org/climate/2014/11/19/3594242/sheldon-whitehouse-carbon-tax/

Extract: "According to details Whitehouse’s office released to reporters, the bill would impose a fee on all carbon emissions (and other greenhouse gas emissions) beginning in 2015. It would start at $42 per metric ton, and then increase by two percent annually in real terms. The fee would fall on all coal, oil, and natural gas that’s either produced in the United States or imported, and it would cover large emitters from non-fossil-fuel sources as well.
This sort of proposal is also commonly called a “carbon tax,” though politicians tend to avoid that term for obvious reasons. But the idea has wide support from commentators, economists, policymakers, and interest groups across both the left and right, because it’s seen as the most efficient and least intrusive way to cut greenhouse gas emissions. In his speech Wednesday, Whitehouse pointed to this support and previous proposals to put a price on emissions that “were market-based, revenue-neutral tools, aligned with Republican free-market values.”
“We simply need conscientious Republicans and Democrats to work together, in good faith, on a platform of fact and commons sense.”"
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #1 on: November 19, 2014, 08:43:39 PM »
Anyone interested in general details about a carbon fee – dividend plan work, the free pdf found at the following link describes in detail such a plan applied to the USA.

http://citizensclimatelobby.org/wp-content/uploads/2014/06/REMI-carbon-tax-report-62141.pdf

Any country adopting such a plan could impose tariffs on countries who do not impose a comparable plan; which, should stop other countries from cheating.

Furthermore, the following link indicates that George Shultz, Greg Mankiw, Romney's Economics Advisor, and Art Laffer, a member of President Reagan's Economic Policy Advisory Board, all agree that the F&D plan is not a tax (because the government does not keep the money, see the attached image of how much money each month an average family would be given under the plan); and they all support the F&D plan; and the plan was one of the finalists in the “U.S. Carbon Price” category of MIT’s Climate CoLab contest:

http://www.normantranscript.com/opinion/article_7e3f4b94-4e42-11e4-a576-378afba4ca8b.html



"What do these three well-known Republican economists have in common?
 
1. George Shultz, President Reagan's Secretary of the Treasury, and Economics Professor at MIT before Reagan tapped him for public service.
 

2. Greg Mankiw, Romney's Economics Advisor, Chairman and Professor of Economics at Harvard University.
 
3. Art Laffer, a member of President Reagan's Economic Policy Advisory Board for eight years with Economics degrees from Yale and Stanford.
 
Answer: All three actively support the Carbon Fee and Dividend proposal by CCL, the Citizens Climate Lobby.
 
Is this idea a tax?
 
George Shultz says, "It's not a tax if the government doesn't keep the money.""

If this F&D plan gains enough bipartisan political support, it might be able to make a difference.

See also:
http://climatecolab.org/web/guest/plans/-/plans/contestId/1300404/planId/2802
“It is not the strongest or the most intelligent who will survive but those who can best manage change.”
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domen_

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Re: Carbon Fee & Dividend Plan
« Reply #2 on: November 19, 2014, 10:03:28 PM »
Well, I hope they can get it through. If they do, that'd mean there's small glimmer of hope for 2°C.

Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #3 on: November 25, 2014, 04:40:58 PM »
People who say it cannot be done should not interrupt those who are doing it.

AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #4 on: November 25, 2014, 07:20:04 PM »
Dana Nuccitelli suggests this may be a bill the Republicans can't refuse.

http://www.theguardian.com/environment/climate-consensus-97-per-cent/2014/nov/25/latest-global-warming-bill-republican-conundrum


Thanks for the link.  Hopefully, the Republic controlled Congress will pass this legislation for Obama's signature. 

With such a simple effective potential solution in-hand, as JFK said: "The only thing to fear is fear itself."
“It is not the strongest or the most intelligent who will survive but those who can best manage change.”
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #5 on: November 26, 2014, 02:49:01 PM »
With such a simple effective potential solution in-hand, as JFK said: "The only thing to fear is fear itself."
Pretty sure you meant FDR.  Roosevelt's messages to the people on surviving the Great Depression -- a model of what we are facing today.
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #6 on: December 16, 2014, 07:49:13 PM »
James Hansen provides numerous discussions on the topic of a Carbon fee and Dividend plan including those in the following links:

http://www.mediafire.com/view/5f3j6rq78mfmr6a/FeeAndDividend.CliveEllsworth.July2014.pdf

http://www.columbia.edu/~jeh1/mailings/2014/20140724_Australia.pdf
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #7 on: December 17, 2014, 02:12:08 PM »
@ClimateReality: When [Heritage Foundation, a conservative think tank] chief economist is confronted with logic he admits a tax on carbon is a reasonable idea http://t.co/dJpzozdaGs
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GeoffBeacon

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Re: Carbon Fee & Dividend Plan
« Reply #8 on: December 17, 2014, 06:43:42 PM »
I do like Hansen's Carbon Fee but there are alternatives that press different political points. I have had some correspondence with Hansen on this.  I think the proposal I have been pushing for some time now "Tax carbon, subsidise jobs" addresses the growth/jobs issue.  We need to cut out polluting economic activity and that might cause the economy to shrink rather than grow.

"Tax carbon, subsidise jobs" can create "full employment" without relying on growth.  I think Hansen's fee with dividend does this but less obviously.

I suspect in practical terms the two proposals would have similar economic effects but with different political flavours.

See: http://www.brusselsblog.co.uk/open-letter-to-james-hansen/

And: http://www.brusselsblog.co.uk/is-economic-growth-necessary-for-job-creation/
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #9 on: December 17, 2014, 06:55:55 PM »
I do like Hansen's Carbon Fee but there are alternatives that press different political points. I have had some correspondence with Hansen on this.  I think the proposal I have been pushing for some time now "Tax carbon, subsidise jobs" addresses the growth/jobs issue.  We need to cut out polluting economic activity and that might cause the economy to shrink rather than grow.

"Tax carbon, subsidise jobs" can create "full employment" without relying on growth.  I think Hansen's fee with dividend does this but less obviously.

I suspect in practical terms the two proposals would have similar economic effects but with different political flavours.

See: http://www.brusselsblog.co.uk/open-letter-to-james-hansen/

And: http://www.brusselsblog.co.uk/is-economic-growth-necessary-for-job-creation/


Geoff,

I agree that achieving the same practical ends using different means (different packages) for various plans in different cultures (USA, EU, China, etc) is advisable; and I believe that given the Republican held US Congress, our only hope of passing such a bill must be tax neutral (or it will not pass).

Best,
ASLR
« Last Edit: December 18, 2014, 01:41:07 AM by AbruptSLR »
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #10 on: December 18, 2014, 01:25:17 AM »
Washington State:
Gov. Inslee Wants To Cap And Tax Emissions From Washington State’s Major Polluters
“I believe it’s our destiny to lead in clean energy. Washington may be less than one-tenth of 1 percent of the world’s population, but we’re number one in the world in software, in aerospace, in apples, in online retailing,” Inslee said in a statement Wednesday. “We can choose cleaner air, more efficient cars and a better transportation system. We can choose energy independence. We have a choice in our future, and we’re choosing to take action.”

http://thinkprogress.org/climate/2014/12/17/3604669/inslee-washington-state-tax-cap-emissions/
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #11 on: December 31, 2014, 04:28:21 PM »
Arguments for a carbon tax, by veteran conservative economist Irwin Stelzer.
http://m.huffpost.com/us/entry/6396864
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #13 on: January 06, 2015, 04:42:11 AM »
After a long PR battle between oil industry lobbyists and California’s regulatory agencies, the state’s cap-and-trade program was extended on Jan. 1, on schedule, to cover companies that sell fuel to drivers. That means fuel retailers will have to either provide lower-carbon fuels or buy permits for the pollution their products put into the air.

http://grist.org/news/californias-cap-and-trade-program-now-covers-cars/
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #14 on: January 07, 2015, 02:11:32 AM »
Oil’s swoon creates the opening for a carbon tax
http://www.washingtonpost.com/opinions/oils-swoon-creates-the-opening-for-a-carbon-tax/2015/01/04/3db11a3a-928a-11e4-ba53-a477d66580ed_story.html


Sigmetnow,

Thanks for this very interesting article.  I will keep my fingers crossed that Congress will act rationally.

Best,
ASLR
“It is not the strongest or the most intelligent who will survive but those who can best manage change.”
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TerryM

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Re: Carbon Fee & Dividend Plan
« Reply #15 on: January 07, 2015, 02:48:52 AM »


Sigmetnow,

Thanks for this very interesting article. I will keep my fingers crossed that Congress will act rationally.

Best,
ASLR
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GeoffBeacon

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Re: Carbon Fee & Dividend Plan
« Reply #16 on: January 07, 2015, 03:19:25 PM »
Previously, I have supported an alternative to Carbon Fee and Dividend (CFD) - a Carbon Tax with Labour Subsidy. http://www.brusselsblog.co.uk/jobs-and-carbon-taxes/] [url]http://www.brusselsblog.co.uk/jobs-and-carbon-taxes/[/url]
In practice, this has similar effects to CFD but less attuned to political thinking in the USA.

In the past couple of weeks I have written two blog pieces:

1. "We need a green recession and full employment"
http://www.brusselsblog.co.uk/free-markets-poverty-and-equality-and-climate/

Thanks to those of you that commented on that.

2. "Economic models for climate policies"
http://www.brusselsblog.co.uk/economic-models-for-climate-policies/

This has a suggestion for modifying "Tax carbon subsidise jobs" but more importantly worries about the link between climate models and economic models. It ends:

The route from the results of the sophisticated Earth systems models of climate scientists to the sophisticated  models of economists is via political channels. (Even the IPCC is political).  In the two economic models mentioned here the scope of the studies are set by their sponsors.  In the case of Strathclyde’s work, it is the Scottish Government.  In REMI’s case it is the Citizen’s Climate Lobby and while the CCL have a deep concern about the climate and future generations, their approach has been chosen to have the best political impact in the USA.

These limitations are madness. We need a richer toolbox of climate/economic policies than those constrained by the current political climate.


I would be very grateful for comments. Particularly mistakes or where I have just got it wrong.

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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #17 on: January 13, 2015, 05:58:17 PM »
The linked article indicates that while there are different ways to structure carbon pricing in order to make it "revenue neutral", studies indicate that it need not damage a nations economy:

http://www.shapingtomorrowsworld.org/HodgkinsonTax.html
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #18 on: January 16, 2015, 04:35:31 PM »
The linked article concludes that:

"The report concludes that changes spurred by the carbon price, including bioenergy production, could cut greenhouse gas emissions by more than half, with a catch -- to achieve the cut, the carbon price must cover emissions from changing land use," MIT said. "Without this safeguard, deforestation becomes a major concern as forests are cleared to make way for farmland."

http://www.eenews.net/stories/1060011746
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #19 on: January 27, 2015, 07:21:44 PM »
While the title of the linked article says that it is about carbon pricing, most of the article is about carbon emissions trading (which I do not like, and I prefer a carbon fee & dividend plan) as indicated by the attached image.  Furthermore, if policy makers have trouble determining the correct price to put on carbon all they have to do is to introduce it progressively and stop increasing the price when they have achieved their emission reduction goals:

http://www.euractiv.com/sections/climate-change-road-paris/carbon-pricing-challenge-future-311576
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #20 on: February 05, 2015, 06:14:59 PM »
The linked pdf discusses World Bank advice on how industry can prepare itself for the coming carbon pricing measures in the future:

http://www.c2es.org/docUploads/pmr-technical-note-9-case-studies.pdf


Note that Angela Merkel has stated that she can accept limited carbon pricing provided that it is combined with additional regulatory measures
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #21 on: February 06, 2015, 08:36:47 PM »
China plans to include aviation in its carbon pricing scheme (currently, only the EU does).
South Africa has a pilot ( :) ) trading scheme on the Johannesburg Stock Exchange to demonstrate how companies and organizations might offset their emissions.
http://www.businessgreen.com/bg/news/2393933/china-to-target-aviation-next-year-in-national-carbon-trading-scheme

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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #22 on: February 12, 2015, 09:04:51 PM »
Here we go!

BOMB-Shell:  Shell CEO Pivots on Carbon: Calls for “Carbon Pricing System”
http://climatecrocks.com/2015/02/12/bomb-shell-shell-ceo-pivots-on-carbon-calls-for-carbon-pricing-system/
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #23 on: February 12, 2015, 10:58:45 PM »
The liberal government in Ontario, Canada is working to develop a carbon pricing plan (see linked article & extract)

http://www.thestar.com/news/queenspark/2015/02/12/carbon-tax-part-of-part-of-environment-ministry-discussion-paper.html

Extract: A strategy paper from Environment Minister Glen Murray says a carbon pricing system “is the most cost-effective approach to reducing greenhouse gas emissions.”
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ghoti

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Re: Carbon Fee & Dividend Plan
« Reply #24 on: February 13, 2015, 06:08:01 AM »
Here's a link to the discussion paper Ontario released.

http://www.downloads.ene.gov.on.ca/envision/env_reg/er/documents/2015/012-3452.pdf

My read of it is that they are leaning towards either cap and trade or a baseline and credit system. I think these are both better than a simple carbon tax/fee because they require reduction of carbon emissions but don't dictate the details of how people or companies make the reductions. They both allow trading in emission credits.

In Ontario over 60% of carbon emissions are from industry (30%) and transport (34%). Certainly transport has proven that fuels are rather price inelastic so emission reductions of any significant size would require massive taxes.

AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #25 on: February 13, 2015, 12:03:13 PM »
Here's a link to the discussion paper Ontario released.

http://www.downloads.ene.gov.on.ca/envision/env_reg/er/documents/2015/012-3452.pdf

My read of it is that they are leaning towards either cap and trade or a baseline and credit system. I think these are both better than a simple carbon tax/fee because they require reduction of carbon emissions but don't dictate the details of how people or companies make the reductions. They both allow trading in emission credits.

In Ontario over 60% of carbon emissions are from industry (30%) and transport (34%). Certainly transport has proven that fuels are rather price inelastic so emission reductions of any significant size would require massive taxes.


I have read that Angela Merkel also believes that carbon pricing by itself is insufficient so she now supports a combination of carbon regulation and carbon pricing.  I agree with Merkel that in the real world we will need a combination of regulations and carbon fee & dividend plans.
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #26 on: February 13, 2015, 05:25:58 PM »
William Becker of the Huffington Post points-out in the following extract that not only does carbon pricing help to correct distorted market mechanisms; if part of the dividend is withheld it could be transferred to developing countries to help implement clean energy programs:

http://www.huffingtonpost.com/william-s-becker/the-ideal-climate-deal_b_6566114.html

Extract: "A universal price on carbon: A universal carbon price would be another substantial source of capital for clean energy development. If climate change is the widest- ranging market failure the world has seen, as the British economist Lord Nicholas Stern has said, then a global price on carbon would be history's biggest market correction.
Energy markets will not be efficient until the price we pay for coal, oil and natural gas accurately reflects their actual costs to society, both direct and indirect. This should be a goal that leaders across the philosophical spectrum can support, from free market fundamentalists to advocates for government market interventions. An ideal climate deal in Paris would include an international commitment in principle and a negotiating path going forward to end the market-distorting, environment-damaging, self-defeating subsidization of carbon pollution."
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #27 on: February 14, 2015, 07:40:06 PM »
A former Ohio governor recommends increased "royalties" on coal, to help a disadvantaged Appalachian coal region.
https://www.americanprogress.org/issues/green/report/2015/02/09/105494/revitalizing-appalachia/
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #28 on: February 15, 2015, 01:21:58 PM »
The Guardian has an interactive page covering Global Divestment Day, Feb 13-14.
"Everyone can contribute, from huge institutional investors to each ordinary citizen with a bank account or a retirement scheme."
http://www.theguardian.com/environment/ng-interactive/2015/feb/13/global-divestment-day-we-are-ready-urgent-action-climate-change

From last September:
CDP, the sustainable-economy non-profit, has compiled the first global database which shows that the world’s largest corporations are outpacing their governments in responding to climate change and expect carbon to be priced.

http://www.theguardian.com/sustainable-business/2014/sep/15/businesses-ahead-governments-climate-change-carbon-pricing
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #29 on: February 17, 2015, 02:29:42 PM »
National differences undermine the EU's carbon market at this point.
The European Union’s carbon market, designed to save the environment, is being undercut by a patchwork of national subsidies for renewables and misaligned energy policies that have helped cut in half the volume of power being traded.

http://www.bloomberg.com/news/articles/2015-02-16/eu-policy-mash-roils-markets-before-paris-climate-deal
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #30 on: February 17, 2015, 07:57:28 PM »
The two linked articles (both with open access pdfs) explore the economic implications of negotiating a single internationally binding carbon pricing plan (that could be adopted say by COP21 in Paris).  Both articles find this carbon pricing approach advisable:

Weitzman ML. (2014), "Can Negotiating a Uniform Carbon Price Help to Internalize the Global Warming Externality?", Journal of the Association of Environmental and Resource Economists [Internet], 1(1/2):29-49.

http://scholar.harvard.edu/weitzman/publications/can-negotiating-uniform-carbon-price-help-internalize-global-warming

http://scholar.harvard.edu/files/weitzman/files/676039cannegotiatingauniform.pdf

Abstract: It is difficult to resolve the global warming free-rider externality problem by negotiating n different quantity targets. By contrast, negotiating a single internationally binding minimum carbon price (the proceeds from which are domestically retained) counters self-interest by incentivizing agents to internalize the externality.  The model of this article indicates an exact sense in which each agent’s extra cost from a higher emissions price is counterbalanced by that agent’s extra benefit from inducing all other agents to simultaneously lower their emissions in response to the higher price. Some implications are discussed. While the study is centered on a formal model, the tone of the policy discussion resembles more an exploratory think piece."


Weitzman M. (2015), "Voting on Prices vs. Voting on Quantities in a World Climate Assembly", Forthcoming.

http://scholar.harvard.edu/files/weitzman/files/2015.voting.prices.vs_.quantities.pdf

Abstract: "This paper posits the conceptually useful allegory of a futuristic "World Climate Assembly" that votes on global carbon emissions via the basic principle of majority rule. Two variants are considered. One is to vote on a universal price (or tax) that is internationally harmonized, but the proceeds from which are domestically retained.  The other is to vote on the overall quantity of total worldwide emissions, which are then distributed for free (via a pre-decided fractional subdivision formula) as individual allowance permits that are subsequently marketed in an international cap-and-trade system. The model of the paper suggests that the majority-voted price is likely to be less distortionary and easier to enact than the majority-voted total quantity of permits. While the study is centered on a formal model, the tone of the policy discussion resembles more an exploratory think piece."
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #31 on: February 19, 2015, 04:36:29 AM »
BP says: price carbon.
One of the world's largest energy companies is warning about rising carbon emissions. And it's endorsing a surprisingly simple solution.

Global carbon emissions will continue to rise roughly 1 percent each year through 2035, according to a report released Tuesday by London-based BP, one of the world's six oil-and-gas supermajors. That puts emissions growth on a path that would be "materially higher" than what most scientists say is necessary to keep global warming within 2 degrees C. In other words, if the world continues to burn fossil fuels at its current rate, Earth's average temperature will rise higher than what most scientists regard as safe levels.

In its report, BP lays out a variety of ways policymakers and businesses could prevent that from happening, including boosting renewable energy production, limiting carbon-heavy coal use, and making energy systems more efficient. It concludes that no one approach will be enough to meet emissions reductions goals, but offers a simple idea that would help guide efforts: carbon pricing.

http://m.csmonitor.com/Environment/Energy-Voices/2015/0217/BP-s-two-word-fix-for-global-climate-change
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #32 on: February 20, 2015, 08:09:18 PM »
New hopes that tar sands could be banned from Europe
Landmark EU fuel quality directive gets a reprieve, opening the way for more-polluting tar sands oil to be taxed at a higher rate effectively pricing it out of the market

http://www.theguardian.com/environment/2015/feb/19/new-hopes-that-tar-sands-could-be-banned-from-europe
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #33 on: February 25, 2015, 01:40:56 AM »
With Republicans in control of both houses of Congress, the odds of passing a climate change bill this year are virtually non-existent. But Rep. Chris Van Hollen, D-Maryland, plans to reintroduce legislation to cap carbon emissions this week, anyway, due in part to the impact it could have on the 2016 election.
...
The thrust of the bill "caps carbon pollution and reduces CO2 emissions gradually but steadily, auctions carbon pollution permits to the first sellers of oil, coal and natural gas into the U.S. market, and returns 100% of the auction proceeds electronically each quarter to every American with a valid Social Security number," he said.

http://www.cnn.com/2015/02/22/politics/global-warming-chris-van-hollen/
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #34 on: March 05, 2015, 06:35:59 PM »
Pigs fly: Another Oil Executive Calls for Carbon Pricing
This time, it's Royal Dutch Shell.
http://climatecrocks.com/2015/03/05/meanwhile-another-oil-executive-calls-for-carbon-pricing/
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #35 on: March 06, 2015, 02:29:22 AM »
The linked article presents a framework for determining the Social Cost of Atmospheric Release (SCAR), which could be used for carbon pricing:

Drew T. Shindell, (2015), "The social cost of atmospheric release", Climatic Change, DOI 10.1007/s10584-015-1343-0

http://link.springer.com/article/10.1007%2Fs10584-015-1343-0

Abstract: "I present a multi-impact economic valuation framework called the Social Cost of Atmospheric Release (SCAR) that extends the Social Cost of Carbon (SCC) used previously for carbon dioxide (CO2) to a broader range of pollutants and impacts. Values consistently incorporate health impacts of air quality along with climate damages. The latter include damages associated with aerosol-induced hydrologic cycle changes that lead to net climate benefits when reducing cooling aerosols. Evaluating a 1 % reduction in current global emissions, benefits with a high discount rate are greatest for reductions of co-emitted products of incomplete combustion (PIC), followed by sulfur dioxide (SO2), nitrogen oxides (NOx) and then CO2, ammonia and methane. With a low discount rate, benefits are greatest for PIC, with CO2 and SO2 next, followed by NOx and methane. These results suggest that efforts to mitigate atmosphere-related environmental damages should target a broad set of emissions including CO2, methane and aerosol/ozone precursors. Illustrative calculations indicate environmental damages are $330-970 billion yr−1 for current US electricity generation (~14–34¢ per kWh for coal, ~4–18¢ for gas) and $3.80 (−1.80/+2.10) per gallon of gasoline ($4.80 (−3.10/+3.50) per gallon for diesel). These results suggest that total atmosphere-related environmental damages plus generation costs are much greater for coal-fired power than other types of electricity generation, and that damages associated with gasoline vehicles substantially exceed those for electric vehicles."
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #36 on: March 06, 2015, 07:13:43 PM »
Tokyo announces 23 percent emissions reduction in 2013 through cap-and-trade program.
http://www.iclei.org/details/article/tokyo-achieves-23-percent-emissions-reduction-in-2013-through-cap-and-trade-program.html
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Lewis C

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Re: Carbon Fee & Dividend Plan
« Reply #37 on: March 09, 2015, 08:50:02 AM »
Can anyone provide, or provide a link to, a coherent refutation of the charges that the Carbon Fee & Dividend :
- not only fails to yield predictable cuts in GHG outputs over the required decades, (given that the fee is entirely subject to political variation and that the system provides neither any limit on FFs' extraction, use or export nor any funding for non-fossil energy supply)
- but also is in effect trading in stolen goods (given that with <5% of population the USA has liability for ~30% of airborne anthro-CO2, meaning that revenues from CF&D are rightly owed not to the US public but to those nations with far below average per capita airborne CO2 liabilities who face extreme loss and damage from climate destabilization).

The latter point is especially significant in its potential to ensure the abandonment of massive coal reserves in developing nations which, with very low labour costs, will otherwise remain competitive with new non-fossil energy suppy for decades to come.

Regards,
Lewis



AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #38 on: March 09, 2015, 11:54:35 AM »
What is needed is effective action now rather than stalling by taking small or short-term action (as COP21 in Paris may well produce).  The linked article discusses why Republicans will fight cumbersome regulations, but may support a Carbon Fee & Dividend plan; which then could be scaled up to other countries (see extract).   

http://californiacarbon.info/2015/03/09/opinion-fee-dividend-better-cap-trade-fighting-climate-change/


Extract: "The complexity of cap and trade is also a barrier to scaling up the program without reducing its effectiveness. Getting the details wrong can mean the difference between success and failure. The European Union’s program is a case in point: It hasn’t adequately reduced emissions partly because the cap was set too high and attempts to remedy the problem haven’t worked yet.
There is no time for that sort of trial and error if we are to avoid the most catastrophic effects of climate change. Instead, we need a price on carbon that we know will work and that can be implemented effectively and quickly.
There is a simple solution that will bring down emissions quickly without increasing the size of government, and without cumbersome regulation, both of which are anathema to Republicans. It’s called a carbon “fee and dividend” plan.
It works like this: A fee is placed on carbon-based fuels at the source (well, mine, port of entry). This fee would start at $15 per ton of CO2 emitted and increase steadily and predictably each year by $10. Within a decade, clean energy would be cheaper than fossil fuels, giving entrepreneurs and investors an incentive to back clean energy sources.
All the revenue realized from the fees would be evenly distributed to all Americans to help pay for increased costs of goods and services. And while cap and trade puts more of the burden of increased costs on lower-income Americans who spend a greater share of their income on energy, fee and dividend protects the less well-to-do. Because they use less energy on an absolute basis, their equal dividend share will more than cover their added costs.
Fee and dividend would also include a border adjustment, so that importers from countries that do not adopt similar carbon pricing would pay their fees at our border. Economically, this ensures a level playing field for U.S. companies. On the emissions side, it ensures that secondary consumption is accounted for, and encourages all countries to place similar fees on carbon.
Fee and dividend is a policy that climate scientists and economists agree is a good first step to reduce catastrophic effects of climate change. California would benefit because the rapid decrease in emissions would be good for the state’s pollution problem and would make costly future AB 32 regulations unnecessary.
And it scales easily. As more nations adopt the system, worldwide demand will bring green technologies to mass market faster, driving down costs and making the transition to a green economy easier for everyone.
But the biggest advantage of enacting carbon fee and dividend is that it’s the quickest way to bring down emissions so we can stabilize, then start restoring, our climate for our grandchildren."
“It is not the strongest or the most intelligent who will survive but those who can best manage change.”
― Leon C. Megginson

AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #39 on: March 09, 2015, 05:36:13 PM »
- but also is in effect trading in stolen goods (given that with <5% of population the USA has liability for ~30% of airborne anthro-CO2, meaning that revenues from CF&D are rightly owed not to the US public but to those nations with far below average per capita airborne CO2 liabilities who face extreme loss and damage from climate destabilization).

The latter point is especially significant in its potential to ensure the abandonment of massive coal reserves in developing nations which, with very low labour costs, will otherwise remain competitive with new non-fossil energy suppy for decades to come.

Regards,
Lewis

Regarding the first world – third world economic divide:
1.  If the rest of the third world follows the pathway that mainland China has followed to economic powerhouse status, then as the per capita carbon emission in China is higher than the per capita emissions in the EU, we would need to concede failure with regard to fighting climate change.  Unfortunately, as the first attached image of "The Economist" magazine projection of the rates of different country's GDP growth in 2015, that is exactly the pathway that the world is following.  Furthermore, China will probably lead much of the third world during the COP21 discussions, in order to ensure that this fossil fuel heavy pathway to third world development is not thwarted by some legally binding universal carbon emission limits.  However, we need to recognize that after 2050 climate change consequences will impact the third world much harder than it will the first world.
2.  A USA lead Carbon-Fee & Dividend-Tariff, CF & DT, would: (a) reduce needless consumption in the US (thus reducing the 30% of worldwide goods that we consume); (b) encourage other countries to develop a similar program or face tariffs if they want to provide goods to the US with high fossil fuel content otherwise they could provide such goods to China; and (c) the dividend could offset US income tax which might leave money available for foreign aid and development of sustainable energy.
“It is not the strongest or the most intelligent who will survive but those who can best manage change.”
― Leon C. Megginson

Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #40 on: March 10, 2015, 05:38:33 PM »
When you get to the last third of the article, you will discover Monbiot is arguing for a global auction of carbon permits.

Keep fossil fuels in the ground to stop climate change
I believe there are ways of resolving this problem, ways that might recruit other powerful interests against these corporations. For example, a global auction in pollution permits would mean that governments had to regulate just a few thousand oil refineries, coal washeries, gas pipelines and cement and fertiliser factories, rather than the activities of seven billion people. It would create a fund from the sale of permits that’s likely to run into trillions: money that could be used for anything from renewable energy to healthcare. By reducing fluctuations in the supply of energy, it would deliver more predictable prices, that many businesses would welcome. Most importantly, unlike the current framework for negotiations, it could work, producing a real possibility of averting climate breakdown.

http://www.theguardian.com/environment/2015/mar/10/keep-fossil-fuels-in-the-ground-to-stop-climate-change
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ghoti

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Re: Carbon Fee & Dividend Plan
« Reply #41 on: March 12, 2015, 07:52:09 PM »
I just looked up some numbers for Ontario. In 2009 15.6 billion litres (4.1 billion US gallons) of gasoline were consumed in Ontario when gas cost on average $0.68 per litre. In 2013 16.4 billion litres (4.4 billion US gallons) were consumed when gas cost about $1.30 per litre.

So almost doubling the "carbon fee" on fuel had zero impact on consumption. This is proof enough to me that a carbon fee without a gradually declining cap would be almost completely ineffective is reducing GHG emissions from transportation. Maybe drivers are different in the US than in Canada but that's pretty unlikely.

I think the consumption pattern in Europe relative to the price they pay for fuel supports this as well.


AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #42 on: March 13, 2015, 11:03:26 PM »
The linked reference indicates that while theoretically comprehensive carbon pricing is the most efficient way to reach ambitious climate change targets, politically the adoption of such a comprehensive carbon pricing plan is not viable in the short-term.  Thus the authors propose an alternate approach of limited carbon pricing, together with support for low-carbon energy technology and a ban on new coal-fired power plants; which they believe might be more politically feasible while keep the ambitious targets in-sight until policymaker and the general public come to their senses.

Christoph Bertram, , Gunnar Luderer, Robert C. Pietzcker, Eva Schmid, Elmar Kriegler & Ottmar Edenhofer (2015), "Complementing carbon prices with technology policies to keep climate targets within reach", Nature Climate Change, Volume: 5, Pages: 235–239, doi:10.1038/nclimate2514


http://www.nature.com/nclimate/journal/v5/n3/full/nclimate2514.html

Abstract: "Economic theory suggests that comprehensive carbon pricing is most efficient to reach ambitious climate targets, and previous studies indicated that the carbon price required for limiting global mean warming to 2 °C is between US$16 and US$73 per tonne of CO2 in 2015. Yet, a global implementation of such high carbon prices is unlikely to be politically feasible in the short term. Instead, most climate policies enacted so far are technology policies or fragmented and moderate carbon pricing schemes. This paper shows that ambitious climate targets can be kept within reach until 2030 despite a sub-optimal policy mix. With a state-of-the-art energy–economy model we quantify the interactions and unique effects of three major policy components: (1) a carbon price starting at US$7 per tonne of CO2 in 2015 to incentivize economy-wide mitigation, flanked by (2) support for low-carbon energy technologies to pave the way for future decarbonization, and (3) a moratorium on new coal-fired power plants to limit stranded assets. We find that such a mix limits the efficiency losses compared with the optimal policy, and at the same time lowers distributional impacts. Therefore, we argue that this instrument mix might be a politically more feasible alternative to the optimal policy based on a comprehensive carbon price alone."
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ghoti

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Re: Carbon Fee & Dividend Plan
« Reply #43 on: March 14, 2015, 02:56:33 AM »
$7 a ton of CO2 is $0.07 per gallon of gasoline, right? 7 cents a gallon is supposed to change driving habits?

AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #44 on: March 14, 2015, 12:44:14 PM »
The $7 per tonne of CO2-equivalent is only a starting point of any viable Carbon Fee & Dividend & Tariff plan (to avoid shocking the system).  Once policymaker's find some willpower the carbon fee would increase progressively until the associated climate change consequences are brought under control.  Furthermore, you forget that the cost of fossil fuels are included in the price of almost everything that a modern citizen uses from electricity, to food, to water, to commodities, etc.; not just gasoline.
“It is not the strongest or the most intelligent who will survive but those who can best manage change.”
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #45 on: April 07, 2015, 04:38:36 PM »
The linked article discusses a tax neutral carbon pricing initiative in Washington State, perhaps this will represent a growing trend in America.

http://www.opb.org/news/article/climate-group-launches-initiative-for-a-carbon-tax-in-washington/
“It is not the strongest or the most intelligent who will survive but those who can best manage change.”
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Sigmetnow

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Re: Carbon Fee & Dividend Plan
« Reply #46 on: April 09, 2015, 07:45:53 PM »
An economist writes in the New York Times that burning all the available fossil fuels would add up to a warming of 16°F.  Not surprisingly, his favored solution is a price on carbon.
http://www.nytimes.com/2015/04/09/upshot/if-we-dig-out-all-our-fossil-fuels-heres-how-hot-we-can-expect-it-to-get.html

Michael Greenstone, the Milton Friedman professor of economics at the University of Chicago, runs the Energy Policy Institute there. He was the chief economist of President Obama’s Council of Economic Advisers from 2009 to 2010.
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #47 on: April 11, 2015, 10:47:32 PM »
Per the linked article: "Politicians “too cowardly” to back carbon price, which would offer better climate benefits than attacking coal, says de Boer". I couldn't agree more with this sentiment.  What we have today are opportunists masquerading as politicians; while what we need are true statesmen with the backbones to legislate carbon pricing (whose revenues could eliminate income taxes before providing the remaining funds collected as dividends; and with any associated tariff funds collected being distributed for Negative Emission Technology, NET, such as reforesting primarily in developing countries like Indonesia, Brazil & the Congo).

http://www.rtcc.org/2015/04/11/former-un-climate-chief-yvo-de-boer-defends-coal-finance/
“It is not the strongest or the most intelligent who will survive but those who can best manage change.”
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GeoffBeacon

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Re: Carbon Fee & Dividend Plan
« Reply #48 on: April 13, 2015, 05:54:49 AM »
These days, I look to the Arctic Forum more than any other source but earlier  posted the following on RealClimate. Does this interest anyone here?

CAN WE QUANTIFY OUR PANIC LEVEL?

Some people panic more about climate change than others.

I would like to find a measure that can give us individual panic scores.

I recognise this is an unclear question. (Can it be made clearer?) but …

1. Assume we will have capitalist markets for this century.

2. Assume climate change mitigation is driven by a carbon price.

3. Assume it’s returned to individuals as in Hansen’s carbon fee with dividend.

What price would you choose?

Use your own personal circumstances and your own knowledge of economics, climate, international relations … and your own vision of how humanity should guide the future.

I would guess/choose at £1000 ($1460) per tonne of CO2e?

I think that suggests I panic quite a lot but have residual hope.

Anyone else willing to have a go?
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AbruptSLR

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Re: Carbon Fee & Dividend Plan
« Reply #49 on: April 13, 2015, 06:22:02 PM »
Geoff,

I like the gradually increasing carbon pricing plan recommended by Citizens Climate Lobby (& supported by Hansen) provided at the following link for the USA.  As the carbon fee equals the carbon dividend the attached figure of the monthly carbon dividend for a USA family of four indicates that circa 2034 I support a family of four paying an average annual carbon fee of about US $4800 per year (or $1,200 per capita including non-income generating people like children).  However, I note that as rich people will pay more carbon fee than poor people, what I support amounts to a wealth redistribution plan (as the common man will not actually be paying this amount, but he will be receiving this amount).

http://citizensclimatelobby.org/wp-content/uploads/2014/06/REMI-carbon-tax-report-62141.pdf

Best,
ASLR
« Last Edit: April 13, 2015, 07:44:52 PM by AbruptSLR »
“It is not the strongest or the most intelligent who will survive but those who can best manage change.”
― Leon C. Megginson