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View Diary: Putting a Price on Carbon -- Polluting must No Longer be Free (36 comments)

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  •  Tip + Rec + Debate (1+ / 0-)
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    jamess
    I'd like to add a few issues to the debate and stir the pot a little, in line with your theme "Who Owns the Carbon".

    Taxing Carbon

    Certianly taxing carbon is essential and there are many approaches including:

    :: Cap + Trade as Commodities (bad, corrupt and not working, if you need arguments I've got pleanty of them, but you could start here or here.)
    :: Cap + Dividend to Consumers (also bad and I'll explain why later)
    :: Tax + Dividend Clean/Green R+D/Infrastructure (a much better choice than the preceeding)
    :: Tax + Feed-In Tarrif (possibly the best short to mid-term, in concert with preceeding)

    Now, I realize the "Tax + Dividend" (consumers) bill has captured the imagination of many American progressives. And hey, what's not to like about it? Because it:

    :: Imposes progressive carbon pricing (SFSG)
    :: It applies carbon pricing at source (um ... maybe don't forget the carbon vending machines are part of the problem too)
    :: It grants each American an equal share of 75% of the carbon tax proceeds to off-set the burden of carbon pricing (Yea! A chicken in every pot!)
    :: It grants 25% of the proceeds to fund R+D & deployment of clean energy infrastructure, to shut down old factories, to offset economic hardship of the mean-to-green transition, and, and, and ....)
    :: It penalizes any imports that come from countries not meeting criteria to be decided later (Smite you, multinational capitalists!)

    And solves every concieveable problem under the sun in under 50 pages of legislation.

    So really, what's not to like, koNko?

    koNko: Don't Taze me Bro, but ....

    First, who owns the carbon?

    :: Fossil fuel/chemical producers
    :: Fossil fuel/chemical users (intermediate users)
    :: Fossil fuel consumers (aka, "Us")

    Relieving the last group from the pain may sound like a good idea in theory. We don't want to hurt the little guy (even wealthy little guys), right? After all, we don't ask those &%$#@'s to use fossil fuels and chemicals, do we? They just do it. And what better way to get consumers united behind carbon pricing and clean energy than to put all of the responsiblity up-stream to those who profit from it, no?

    No. Wrong. Fail. First, the law of unintended consequence comes into play. Taxes (cost) up-stream get passed downstream. (The author of the bill clearly understands that.) So then, we solve that problem by giving a subsidy to consumers, and then ... um, 100% taxation magically becomes 25% taxation.

    This law does not direct or require how consumers spend the dividend although the underlying principle is to relieve them of the burden of their own consumption. So hey, suck on my tailpipe, Prius owners.

    I'm sorry, but this has got to be the most lame-brained idea for promoting resource conservation and clean energy I have ever seen; a big user tax holiday for consumers. G.D. right, why the heck sould consumers have to be responsible for this mess?

    Next let's consider the 25% share for promoting clean energy. The bill purposts to use that princely sum for R+D, clean energy infrastructure, off-setting the cost of shutting down inefficient factories (pay out to whom is not clear), compensating people suffering the consequences (presumably unemployed?) and to solve a host of other problems.

    However, since there is no estimation of what that would all cost I suppose it can just be made to fit the 25%, or hell, just let them fight over it, because without any numbers, who can argue?

    What else does the bill do? Rewards carbon sequestering. Yes, that's correct, don't adjust your TV set, we have taken temporary control of it until the global carbon bomb explodes.

    What does the bill not do?

    :: No feed-in tarrifs to promote renewables in the short- to mid-term until the cost can come down and sufficient capacity exists to arrive at stable, fair market pricing.
    :: No form of investment tax credits or loan gaurentees for utilities to convert and clean energy technology companies to build capacity. (Never mind that conventional and clean energy companies tend to be a different set and the conventional ones are the ones with the huge cash reserves.)

    And who will take care of that? "The Market".

    Have I heard that somewhere before? Hum ...

    "Let consumers and the market decide".

    Yes, that will be our slogan. Even Teabaggers can get behind that one.

    Need I say "Gesh"?

    +++ next topic +++

    Let's get back to carbon ownership and consumers.

    Industrialized countries benifited for years (more than a Century) by pumping carbon into the atmosphere just as they polluted the waters. And you are correct, it had a cost, and eventually, that cost caught up with them. So how has that problem been dealt with? Well, to a very great degree, by shipping it to other countries (and I do mean shipping). Such as:

    :: Sending garbage and pollutants to poor countries
    :: Moving polluting industries to poor countries.
    :: And in doing so, multinational corporations have retained and iven increased thei profitability, leaving poor countries poor or a little less poor, but a polluted mess, and guess who gets to pay to clean that up? Poor people. And if they kick the bill back, goodbye, there are other poor people available to take up the slack.

    Sucks, doesn't it?

    But hey, I have a solution. Let's tax the products from those countries and give 75% of the proceeds to consumers. And that's justice, because a lot of those consumers are now out of work and could use the money (actually true).

    So I have to agree, the Tax and Dividend scheme is, a brilliant piece of work.

    Level that playing field. Maximum gain, minimum pain. Consumers win. The customer is always right.

    Your thoughts?

    BTW, I think you have got an awful lot correct. At least 70%. Good work. (:^)

    "Life immitates art, but takes license." - ko

    by koNko on Fri Jun 25, 2010 at 05:59:58 AM PDT

    •  thanks for your well reasoned arguements koNko (1+ / 0-)
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      koNko

      I get that you are against C&D plan,
      you have told be that much before.

      What I still don't get is what you're FOR?

      Is it a Carbon Tax?
      Or what you call:  "Tax + Feed-In Tarrif"
      (link?)

      Now it sounds like you're advocating
      Import Taxes too -- to level the Green Playing Field?
      (a noble sentiment)

      We'll be very lucky to get any of the existing Carbon Pricing plans to pass,

      Which is why I like the C&D plan --
      Because, in my estimatation, it has the BEST chance of ACTUALLY Passing --

      Not because it is socially inequitable in its distribution of economic pain.
      Since when was THAT a precondition, in our current Economic Systems?

      Equity -- never had it.  Probably never will.
      Not in our lifetimes anyways.

      Peace koNko
      I look forward to reading your Diaries on this Topic.
      you definitely have the material for it.

      The press is impotent when it abandons itself to falsehood. --Thomas Jefferson to Thomas Seymour, 1807

      by jamess on Fri Jun 25, 2010 at 07:48:49 AM PDT

      [ Parent ]

      •  For (0+ / 0-)

        I definately support carbon pricing; it is essential in any case to establish market regulation mechanisms and to recover some of the cost of carbon to society.

        What follows, is how best to use the revenue to promote clean energy.

        I don't think there is a single formula or solutions, but rather a budle of measures that must be taken and different stages of development.

        The main point is this money needs to be invested in clean energy capacity; consumers do not product power, they consume it, so handing the money drirectly to consumers makes no sense. for example, suppose a utility A has mixed carbon/renewable generation verses uitility B. In the short term, utility a is put at disadvantage since they must shoulder some high capital investment, increasing their cost. So where is the incentive? If you hand consumers money, it does not help utility A to lower their cost, so they are, in effect, penalized. On the other hand, if they can get feed-in tarrifs for the clean energy produced until their cost is reduced to parity (by depreciatin of the capital assests), then the consumer is sheltered (price for clean energy was not increased).

        To jump start local markets for clean energy, carbon taxation and clean energy feed-in tarrifs have proven to work well, to help clean energy projects survive until they can produce and lower depreciation on assets to the point they can turn a profit. So this can be a temporay or term grant to clean energy projects; once they produce in parity they no longer need the tarrifs.

        The other places carbon revenues should be used are obviously to fund, to some degree, R+D and to provide grants or loan garuntees to producers of clean energy and energy conservation technology/equipment, to mass-transit and as grants, tax rebates or low cost loans to consumers to improve their energy effciency (including self-generation where that works).

        Some other essential ingredients are national energy standards and codes, in particular building codes that mandate new construction be energy efficient, and in energy efficiency/emissions regulations for businesses, including rental properties.

        One special point I would like to rase as well is the renuwables rally require smart grids to operate to full potential. this is a lesson learned in China; we have raced to install quite a lot oc renewable capacity and learned that beyond a certian level in a given area, if there is not a smart grid then the power produced when renewable are operating at maximum effciency is often wasted, so now this problem is being addressed in planning and project rules, but converting to smart grids takes years (in an existing grid).

        In fact, on American company do very well in China now is American Superconductor, who make power management systems tailored for renewables; they are a big winner in wind projects teming with several windmill producers. Another is First Solar, who are leaders in grid-connected pv Solar and won the largest project in China (and the world) Davos City Solar Plat, because their power management effciency is the best in the industry, eanabling them to beat Suntec (China's largest) to capture this project.

        I don't think there is a perfect model to implement clean energy yet, it's highly complex and situation dependant, so the world is feeling it's way and some policy flexibility is very essential.

        I'm intending to write a diary to tackle the subject of the global politics of carbon. This is the present stubling block of the COP negotiation process. Originally, I was intending to write this as a prelude to COP-15 but was too busy at the time. That's lucky, because I don't think it would have had much of a receptive audiance then. Since then, much has changed and I think people are becoming more aware of the problems and complexity of the situation, and that not only do we need global cooperation to the extent it can be managed, but leading nations need to lead and work together in a constructive way since they have benifited the most economically from the carbon economy and have some responsibility for the problems.

        "Life immitates art, but takes license." - ko

        by koNko on Sat Jun 26, 2010 at 01:48:40 AM PDT

        [ Parent ]

      •  One afterthought (0+ / 0-)

        This may interest you. One thing China is now doing with polluters, including companies that fail to meet energy effcicency and emissions standards is confiscation of profits.

        While Obama took a bold move to pressure BP to set aside funds (something I applauded) the controvesy wheter this was leagal is interesting. I think it was; he did not force them by law, but pursuaded them (by what means I'd like to know) to do so, so it was actually volentary.

        But now in China there is the legal basis for the government to do so and to hold top executives  criminally responsible for the consequences of poolition and accidents, and it fact, in several recent mining disasters excutives have been aprehended and put to trial, while a few others have become fugitives.

        If the BP disaster had hapened in china today, I'm pretty sure Mr. Tony would be in the dock and Western governments would be screeming about the authoritarian practices of the chinese government, but the Chinese people sure support this.

        Why shouldn't corporate excecutives be responsible for corporate actions, expecially if corporations are to recieve the rights of people?

        "Life immitates art, but takes license." - ko

        by koNko on Sat Jun 26, 2010 at 02:01:02 AM PDT

        [ Parent ]

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