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Carbon tax fine print

Carbon tax fine print 

If the Paris agreement target of keeping global warming to well below 2°C is to be met, it is generally agreed that global emissions of carbon dioxide (CO2) from fossil fuels and industry need to peak and then decline very soon–meaning before the end of next year, or very shortly after.

A recent study published in Nature Climate Change sheds light on how 18 countries have managed to achieve this feat: effectively reducing their emissions of CO2 over the period 2005 to 2015. The figure below shows emissions of CO2 from fossil fuels for the 18 countries in the ‘peak and decline’ group.

Change in CO2 emissions from fossil fuel combustion for the 18 countries in the peak and decline group [1]

In spite of this positive performance by 18 countries representing almost 30 percent of total CO2 emissions, global emissions of energy-related CO2 rose in 2017– after a sluggish period from 2014 to 2016 when there was hope that emissions may have flatlined. That hasn’t happened, and estimates for 2018 indicate that CO2 emissions are continuing to rise. 

It’s instructive to look more closely at how this group of ‘peak and decline’ countries have managed to reduce their CO2 emissions over the decade through to 2015. Are there lessons to be learned?

 …click on the above link to read the rest of the article…

Carbon price wars–BC, Ontario or Quebec?

Carbon price wars–BC, Ontario or Quebec?

The question of how the Canadian provinces should deal with the issue of greenhouse  gas emissions continues to be contentious and occasionally acrimonious.

The new provincial government of Ontario has declared its intention to cancel that province’s cap-and-trade system—referring to it as “a punishing, regressive tax that forces low-and middle-income families to pay more.” A week ago the province of Alberta threatened to pull out of the Federal government’s carbon pricing scheme after progress on building the Trans Mountain Expansion pipeline ground to a halt. Progressive Conservative leader Andrew Scheer has vowed to shut down carbon pricing asserting: “Conservatives know that carbon tax isn’t just bad for big business; it’s bad for everyone. And that’s why, come 2019, my first act as prime minister will be to get rid of it once and for all.”[1]

So is it?  Bad for everyone?

There is no question that pricing carbon works. Over 51 countries and subnational jurisdictions are now operating carbon pricing systems, or planning to do so.[2]  A report last year by two of the world’s top  economists was clear: “A well-designed carbon price is an indispensable part of a strategy for reducing emissions in a efficient way.[3]

Earlier this year, Environment and Climate Change Canada published the results of a modeling exercise which showed that a carbon pricing system applied across Canada would reduce greenhouse gas pollution by between 80 and 90 million tonnes by 2022–making a significant contribution to meeting Canada’s Paris Agreement target of a 30% reduction over the period 2005 to 2030. [4]

But some forms of carbon pricing systems seem to work a lot better than others. Can we learn a few lessons and draw some conclusions by looking at the performance of the four Canadian provinces where carbon prices have been introduced: Quebec, Ontario, Alberta and British Columbia?  Of the four, British Columbia’s revenue-neutral carbon pricing system is widely regarded as a major success.[5]  But the latest data on Canada’s greenhouse gas emissions paint a rather different picture.

…click on the above link to read the rest of the article…

The Right Price for Preserving Our Climate

The Right Price for Preserving Our Climate

WASHINGTON, DC – When world leaders convene in Paris this week for the United Nations Climate Change Conference, their task will be to reach a global agreement on curbing greenhouse-gas emissions. A successful outcome, demonstrating that countries can work together for the good of the planet, would send a powerful message of hope to the world – and to the people of Paris, who remain unbowed after the recent terrorist attacks.

Climate pledges will be made on the basis of Intended Nationally Determined Contributions (INDCs), or commitments to the reduction of emissions worldwide. I believe that the price of emissions should be at the center of these pledges.

Achieving a decline in greenhouse-gas emissions at the lowest possible cost requires a revolution in energy use and production. Gradual, predictable, and reliable increases in energy prices would provide strong incentives for consumers to reduce their energy bills. At the same time, the right carbon price would enable a smooth transition away from fossil fuels by encouraging investments in technological innovation.

That is why the International Monetary Fund’s staff have recommended a three-part strategy on carbon fuel: “price it right, tax it smart, and do it now.” Each component is essential.

First, setting the right price for fossil fuels means taking into account their true environmental costs. Prices should pass on to end users the full cost not only of production and acquisition, but also of the damage – including air pollution and climate change – caused by intensive reliance on fossil fuels. A fairer carbon price will drive energy savings and boost demand for cleaner fuels and “greener” investments.

Second, the necessary change in prices would be achieved by taxing energy, using tools that are both practical and efficient. The best option is to build a carbon charge into existing fuel taxes and apply similar charges to coal, natural gas, and other petroleum products.

…click on the above link to read the rest of the article…

Social Cost Of Carbon Drastically Underestimated: Report

Social Cost Of Carbon Drastically Underestimated: Report

The U.S. government could be drastically underestimating how much climate change is going to cost us, according to astudy published by Stanford researchers in the journal Nature Climate Change.

The researchers concluded that the Obama Administration is using a Social Cost of Carbon estimate that may be just one-sixth of the true cost—and that the true cost is high enough to justify aggressive measures for lowering emissions enough to limit global temperature rise to the 2 degrees Celsius that scientists tell us is the threshold for averting catastrophic climate change.

The Social Cost of Carbon is an official estimate of how much economic damage will be caused per metric ton of carbon emitted into our atmosphere—damages like lower crop yields and higher healthcare costs. It is used by the EPA and other federal agencies to calculate the benefits of policies intended to improve energy efficiency, lower emissions, and combat climate change. It is also often used to justify not taking action if the proposed action would cost more than the damage it is intended to mitigate.

…click on the above link to read the rest of the article…

Ontario To Put A Price On Carbon Emissions: Environment Minister

Ontario To Put A Price On Carbon Emissions: Environment Minister

The Ontario government plans to put a price on carbon emissions to cut down on greenhouse gases, making good on a seven-year-old promise to fight climate change.

The province’s environment minister said Tuesday his new climate strategy will set Canada’s most populous region on a path to reduce its GHG emissions by 80 per cent by 2050. And, as The Globe and Mail reported “he pledges carbon pricing will be part of it.”

“We’re looking at how we can transition Ontario to a low carbon economy through initiatives such as setting a price on carbon, the adoption of cleaner fuel standards, energy efficiency and conservation measures,” Glen Murray said in an email to Huffington Post Canada.

 

Carbon pricing charges emissions from both corporations and consumers through various measures including emissions trading systems, carbon taxes or payments for emission reductions. Ontario has not yet decided which path to follow.

“Market mechanisms which encourage technological innovation can facilitate the transition to a low carbon economy and promote economic development and job creation not only in Ontario, but across Canada,” Murray said.

…click on the above link to read the rest of the article…

 

Polluting Is Getting Expensive in Europe Again: Carbon & Climate – Bloomberg

Polluting Is Getting Expensive in Europe Again: Carbon & Climate – Bloomberg.

The surge in European carbon permit prices may just be beginning.

The price of emission rights will rise 62 percent by June 30, according to the median of 16 trader and analyst estimates compiled by Bloomberg. UBS Group AG says costs may more than double in 2015. Carbon already jumped 44 percent this year, while the 22-member Bloomberg Commodities Index (BCOM) slid 14 percent.

The 28-nation European Union is tightening supply in the 40 billion-euro ($50 billion) emissions market after a glut caused prices to collapse to levels that don’t deter the burning of coal, the most polluting fuel, data compiled by Bloomberg show. Lawmakers want to spur more growth in renewable energy through the first permanent changes to the 10-year-old system.

“Because most governments selling allowances have a vested interest in higher prices, it will happen,” Louis Redshaw, a former head of carbon at Barclays Plc and founder of Redshaw Advisors Ltd., which buys and sells permits on behalf of factories, said Dec. 16 in London. “Painful” price swings are probable, he said.

…click on the above link to read the rest of the article…

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