Australia is in denial about this. The net effect is that prices offshore will be externally taxed (de facto if not de jure: prices will incur a consequence of a failure to implement in-nation carbon pricing so it becomes the border adjustment issue), with revenue going to the importer nation, because we refuse to implement a market onshore.
A carbon price only works if it is high enough to fund equal carbon offset projects AND the money is actually spend on carbon offset projects.
Personally, I advocate for a "carbon market" type system, where any company, is required to buy carbon credits equal to the amount of carbon they produce. You can't grandfather companies into a given amount of carbon credits, every carbon credit must be created by another entity capturing and storing carbon.
This carbon market should find the correct price for carbon, and create growth in the carbon offset industry. Some industries might decide the correct solution is reducing their emissions to zero, others might decide it's cheaper to just buy carbon credits.
The government also gets a useful knob to force market into carbon negative territory, by forcing companies to buy 1.1 carbon credits for every unit of carbon they emit.
If you tax gasoline to $1,000/gallon (and other emissions to the same price per CO2e) it doesn't matter if the money gets spent on carbon offsets or not, the deterrent effect would dwarf the removal effect. Revenue-neutral tax+dividend programs like the one described in TFA seem far more politically viable than tax+spend alternatives.
The problem with tax+dividend is that it makes net-zero near impossible to achieve. Not unless you tax absolutely everything which produces carbon, which would be highly damaging to the economy and therefore politically unpopular.
And if we actually want to reverse some of the damage we have already caused, we need to go massively net-negative.
I'm not a fan of tax+spend either, which is why I support a carbon market solution.
Not yet. Currently the demand for carbon offsets is tiny, so the supply is correspondingly low.
You would have to bootstrap the system by inserting a large number of 'phantom offsets' into the market at the start. These fake offsets will be retired on a schedule or formula so that companies deciding to enter the carbon offset industry have a good idea about demand during their planning stages.
Whenever possible, the carbon market will encourage industries to produce less, it should always be the cheaper option. But reducing carbon emissions is harder in some industries, and the carbon market gives those industries an alternative option.
Also, it's impossible to reach net-zero emissions by just emitting less. Plus, the latest papers make it clear that we are far past the point were we can limit damage by simply going net-zero. We need to go massively net-negative.
If we want to go net-negative, we need a robust carbon offset industry, and a carbon market is one way of encouraging growth in that industry.
Besides, as far as the global environment is concerned, there is zero difference between not emitting CO2 and emitting CO2 in one place and sequestering it in another.
Except all the "cheap" forms of carbon sequestration are scams.
Put carbon in the soil or trees and it is just a fire away from being released again.
Crush olvine on the the beach and you will never know how much carbon was captured, if any.
If you compress it to 1500 psi and inject it underground you can measure it going in the same way you measured oil and gas coming out. That's real, but it is a lot more expensive. Nobody should be paying for any of the other things.
The trouble is that we don't know the true cost of the externalities of carbon emissions until it's far to late.
If carbon leads to climate feed backs that ultimately lead to an extinction event on the scale of the End-Permian (which is a real possibility) then it's clear that the "price" of carbon, factoring in all it's externalities, should make using hydrocarbons so expernsive we never would have propped our civilization (and species) up with them.
If climate change and the other externalities of carbon emissions only mean the collapse of industrial civilization, we would find an equally prohibitive price.
I'm in agreement with GP that this is mostly a failed policy. Until we see carbon emissions drop fairly dramatically this will just be shuffling around money to different people while we watch the planet heat up.
> A carbon price only works if it is high enough to fund equal carbon offset projects AND the money is actually spend on carbon offset projects.
Then comes the political reality where one party will propose enough money for all that, then it gets wheedled down to half, then half of that goes to pork and then a half of the remainder is overhead, so consultants get that 1/8 to draw up an estimate and the budget's gone
Lead emissions was hyper specific and a replacement was immediately available. There's unavoidable emissions in logging, concrete, steel so we'll always need a way to offset emissions even after switching all power generation and transport
Concrete is totally avoidable, but the Portland Cement lobby won't yield to geopolymers or Chinese CAC members despite reminder after reminder (like last week in Florida) that portland cement + rebar is temporary at best.
The case in florida wasn't due to portland cement, but due to incompatible aggregate (read: sand) being used.
We have a good understanding of the mechanisms now, and non-flowable concrete doesn't have lifetime issues (unless you could centuries as "temporary").
Turns out: capital markets don't incentivse >>50y investments.
> We didn’t set a price on lead emissions, we banned leaded gas and lead paint.
Because there was an alternative. There is no current good enough alternative to burning fuel. We want to motivate people to come up with some, and you do that with money.
Imagine if you could actually ban all fuel burning starting tomorrow - think about the results: Country wide blackouts (so no electric cars), no fuel, so no gas cars either.
All food deliveries stop, water pumps stop, and people die.
Carbon Border Adjustments can theoretically go further than just insuring locally consumed imports are offset.
In the future, we might see a union of countries that have carbon pricing agree to apply adjustments to non-carbon priced countries equal to (or greater than) their estimated internal carbon outputs.
Those funds can be redirected into extra carbon-offset projects.
With this mechanism, it's theoretically possible to force the would to be carbon neutral (or carbon negative), even if there are a few large countries holding out.
This is by far the most exciting part of the whole idea.
Up here in Alberta Canada we have an oil producing province chock full of people who are against the Federal carbon tax.
Some are climate deniers, but most are rational people who are asking: “Why we should sacrifice our wealth to reduce emissions when capital investment will just flow somewhere that has no carbon tax and the emissions will happen anyways?”
Up until the idea of CBAs started gaining traction the only answer anyone could muster was “Because it’s the right thing to do”, which is incredibly weak and unlikely to convince pragmatic individuals or anyone who benefits from the oil industry (~5% of GDP, so it’s a lot of people).
I hope that CBAs can be a way of addressing this concern such that taking action on climate change doesn’t mean reducing global competitiveness.
> “Why we should sacrifice our wealth to reduce emissions when capital investment will just flow somewhere that has no carbon tax and the emissions will happen anyways?”
It’s a shame anyone who is skeptical about realities of tax policy changing the climate are labeled “deniers”.
You have perfectly illustrated the right argument. So the question is really, “by what mechanism other than world war are you going to force everyone on to the same tax and credit system”?
Maybe it is import/export and border adjustment, IDK. Interesting idea.
Western countries should consider going further to incentivize other partners into curbing their emissions: place quotas on visas issued to foreign national from polluting countries that are not part of the union.
Some countries have a point-based system for immigration, why not reward those doing their parts for the planet?
I’m not sure that would have the effect you have in mind. It’s kind of complicated if you’re a country that is losing population to emigration. Yes, remittance payments come in. But brain drain is a big problem, and most countries facing it try to stop it however they can. So, fire up a coal plant and nobody can get visas out? Seems like that could backfire.
Right now, western countries themselves could do a lot more to curb their emissions. No one is on track for the Paris agreement: https://climateactiontracker.org/
Given that tariffs seem more popular than domestic taxes these days, carbon border adjustments might be a politically feasible way to get a price on carbon.
Canada's carbon pricing works this way (though, technically, it's not a tax) and, generally, has popular support. The rebate varies between provinces and is calculated along with your tax refund.
>Exemptions can be made. Low-income countries .. those that have strong domestic climate ambitions, etc, can all be used as defining attributes to warrant exclusion from a border adjustment.
translation, exclude china and most other "developing" nations while increasing the Tax on "rich" nations, a tax that is regressive in nature and will impact the poor people living in "rich" nations the most...
Carbon pricing and carbon offsets are the equivalent of putting a band-aid on a patient dying of blood loss because its legs have been cut off.
By all accounts its already too late to stop the warming of the planet and we will have to learn to live with the consequences of our actions for the foreseeable future.
Even with wildfires raging across the northern hemisphere this year and in the southern hemisphere last year we keep on digging more coal and oil from the ground.
We keep on acting as if its business as usual. Move along, nothing to see here.
And no, renewable energy is not going to save us. We wont even reach 45% of renewable energy production worldwide for another 20 years at best.
Our global population keeps on increasing and we are depleting our natural resources at an ever faster pace than before therefore increasing deforestation and carbon emission.
All of this done in order to satisfy the need for our economies to grow no matter what the cost on our habitat is, and threatening a million species of animals/insects in the process.
There is a garbage island in the pacific and there will be soon more plastic in the ocean than fish. What a depressing thought.
If only we were the rational creatures that we think we are, maybe we would stop this madness and realize that we are driving at full speed towards a cliff.
We need to start reducing our carbon emissions aggressively within the next 5 years. We need to stop destroying forests and plant trillions of trees.
We also need to stop thinking that renewable energy will save us. It wont. Maybe in 50 years, but its already too late as of now.
We need to stop ICE cars from being sold within the next 5 years and we need to start decreasing our population to reach a natural equilibrium with our global ecosystem.
Its time for the leaders of this world to acknowledge that we are in danger as a species.
It's time to call a spade a spade and its time to stop having pointless debates about climate change. Its time to act.
This is too romantic. Politicians invest most of their time in maintaining their power. (even in democracies) Policies are just things that happen on the job.
If you can maintain power by doing the exact opposite of your position then that is exactly what is going to happen. The conservative German party CDU gets 30% in Germany because people don't want things to change. The CDU is well known for pretending to care about the environment and then not doing anything, their voters don't see a problem in that, they like it that way.
> We need to start reducing our carbon emissions aggressively within the next 5 years.
Just need to point out that a price on carbon is a mechanism for achieving exactly this. The goal is to make emitting energy sources expensive enough that people shift to carbon free alternatives wherever possible.
Not OP, but I don't think this is such an irrational point of view. We're already seeing the effects of climate change; it's no longer the looming danger in "the future", it's something we deal with today. It's not so much that we can't do anything to try, technically speaking, it's that we most likely won't, for two reasons in particular. Firstly, we're trading a short term loss for a long term benefit. At a societal level, organized around quarters, financial years and terms of office, this is a hard sell. It's quite literally evolution. Some people alive today will never see the benefit of combatting climate change, so why should they, in their rational self-interest, support any action against climate change? Secondly, climate change is a global problem that needs a global solution. That doesn't mean we shouldn't do anything unless everyone everywhere does something, but it is essentially the diplomatic equivalent to the prisoner's dilemma. No nation wants to make the hard sacrifices necessary alone, which would only put them at a severe disadvantage, possibly for no benefit at all. It's also something that can be infinitely postponed into the future until one day it's too late.
In summary, climate change is a human problem, not a technological one. Technology has changed a lot and continues to do so, but the fundamentals of human psychology haven't really changed. We know of the problem, we have the technology to solve it, to the extent that it can be solved, but not the will and coordination to do so. Yet what reason do we have to believe that this will change in the future?
A political will is definitely lacking. One thing we cannot say, when the last forest has been cut down or was burned down during the soon to be longer summer months, when the food chains start collapsing due to the death of trillions of insects, is that we did not know.
We knew as far back as the 80s that this was going to happen but too often the human species likes to bury its head in the sand until its too late.
There is no reason to think that this will change anytime soon.
We, in tech like to think about technological solutions to a problem. In this case the tech is here. Its affordable, but we are not embracing it as we should.
Instead of committing to net zero in 2050, we should do the transition in less than a decade and then start capturing CO2 from the atmosphere after that. Yet here we are debating if we should or not start trading carbon credits between ourselves, as if there is nothing better to do.
>We, in tech like to think about technological solutions to a problem. In this case the tech is here. Its affordable, but we are not embracing it as we should.
Even when it makes financial sense people may be attached to the old way of doing things. They may drive an ICE car because they want to complete their 500 mile trip with one tank even though charging on the way only delays the trip by 30 minutes, something which is possible today.
There are inferior ways of achieving a goal that don't harm the planet. They often require a small sacrifice but they are possible today. When someone insists on an ICE because of a difference in range, they insist that engineers solve the impossible e.g. carbon capture [0] even though a possible solution exists.
That is the real problem. We collectively decide to create a problem that is impossible to solve and then we point at the engineers. They are already solving problems, you know, the solvable ones.
[0] By that I mean enough carbon capture to undo all the pollution that we didn't even try to prevent.
It's not that it's irrational, it's that this is how depressed people think and write.
Of course, I know nothing about OP, have no professional knowledge, and could be way off. I just thought mentioning it might push someone to seek help. I won't mention it again.
---
Climate change is a hard problem, but not for the reasons you give. To me, it's mainly a "Collective Action Problem". I, my city, my state, or my country may do our part of what's needed to solve the problem, but it won't be worth anything if the rest of the world doesn't join in.
Worse, our sacrifices makes the problem less urgent for other regions, who can "free ride" on our efforts.
If there was "local global warming", and changing California's emissions would fix California's weather, I think it would long since be handled, despite the long term nature of the benefits.
42 comments
[ 2.0 ms ] story [ 89.5 ms ] threadWe didn’t set a price on lead emissions, we banned leaded gas and lead paint.
Carbon permits are a failed policy; they will make somebody rich, who will feed back 1% of the profits to politicians to maintain their privilege.
[1] - https://en.wikipedia.org/wiki/Carbon_emission_trading
[2] - https://en.wikipedia.org/wiki/Carbon_price
Personally, I advocate for a "carbon market" type system, where any company, is required to buy carbon credits equal to the amount of carbon they produce. You can't grandfather companies into a given amount of carbon credits, every carbon credit must be created by another entity capturing and storing carbon.
This carbon market should find the correct price for carbon, and create growth in the carbon offset industry. Some industries might decide the correct solution is reducing their emissions to zero, others might decide it's cheaper to just buy carbon credits.
The government also gets a useful knob to force market into carbon negative territory, by forcing companies to buy 1.1 carbon credits for every unit of carbon they emit.
And if we actually want to reverse some of the damage we have already caused, we need to go massively net-negative.
I'm not a fan of tax+spend either, which is why I support a carbon market solution.
But it doesn't follow that we need to e.g. reduce petrol consumption to zero.
Squeezing out that last one or two percent is going to be much harder than just moving on and looking for gains elsewhere.
You would have to bootstrap the system by inserting a large number of 'phantom offsets' into the market at the start. These fake offsets will be retired on a schedule or formula so that companies deciding to enter the carbon offset industry have a good idea about demand during their planning stages.
Whenever possible, the carbon market will encourage industries to produce less, it should always be the cheaper option. But reducing carbon emissions is harder in some industries, and the carbon market gives those industries an alternative option.
Also, it's impossible to reach net-zero emissions by just emitting less. Plus, the latest papers make it clear that we are far past the point were we can limit damage by simply going net-zero. We need to go massively net-negative.
If we want to go net-negative, we need a robust carbon offset industry, and a carbon market is one way of encouraging growth in that industry.
Besides, as far as the global environment is concerned, there is zero difference between not emitting CO2 and emitting CO2 in one place and sequestering it in another.
Put carbon in the soil or trees and it is just a fire away from being released again.
Crush olvine on the the beach and you will never know how much carbon was captured, if any.
If you compress it to 1500 psi and inject it underground you can measure it going in the same way you measured oil and gas coming out. That's real, but it is a lot more expensive. Nobody should be paying for any of the other things.
The trouble is that we don't know the true cost of the externalities of carbon emissions until it's far to late.
If carbon leads to climate feed backs that ultimately lead to an extinction event on the scale of the End-Permian (which is a real possibility) then it's clear that the "price" of carbon, factoring in all it's externalities, should make using hydrocarbons so expernsive we never would have propped our civilization (and species) up with them.
If climate change and the other externalities of carbon emissions only mean the collapse of industrial civilization, we would find an equally prohibitive price.
I'm in agreement with GP that this is mostly a failed policy. Until we see carbon emissions drop fairly dramatically this will just be shuffling around money to different people while we watch the planet heat up.
When mass casualty events become common by 2030, political and financial elites will face angry crowds and death over this failed policy.
It's never too early to start doing the right hing.
Then comes the political reality where one party will propose enough money for all that, then it gets wheedled down to half, then half of that goes to pork and then a half of the remainder is overhead, so consultants get that 1/8 to draw up an estimate and the budget's gone
Turns out: capital markets don't incentivse >>50y investments.
Because there was an alternative. There is no current good enough alternative to burning fuel. We want to motivate people to come up with some, and you do that with money.
Imagine if you could actually ban all fuel burning starting tomorrow - think about the results: Country wide blackouts (so no electric cars), no fuel, so no gas cars either.
All food deliveries stop, water pumps stop, and people die.
So, how sure are you that you want to ban CO2?
In the future, we might see a union of countries that have carbon pricing agree to apply adjustments to non-carbon priced countries equal to (or greater than) their estimated internal carbon outputs.
Those funds can be redirected into extra carbon-offset projects.
With this mechanism, it's theoretically possible to force the would to be carbon neutral (or carbon negative), even if there are a few large countries holding out.
Up here in Alberta Canada we have an oil producing province chock full of people who are against the Federal carbon tax.
Some are climate deniers, but most are rational people who are asking: “Why we should sacrifice our wealth to reduce emissions when capital investment will just flow somewhere that has no carbon tax and the emissions will happen anyways?”
Up until the idea of CBAs started gaining traction the only answer anyone could muster was “Because it’s the right thing to do”, which is incredibly weak and unlikely to convince pragmatic individuals or anyone who benefits from the oil industry (~5% of GDP, so it’s a lot of people).
I hope that CBAs can be a way of addressing this concern such that taking action on climate change doesn’t mean reducing global competitiveness.
It’s a shame anyone who is skeptical about realities of tax policy changing the climate are labeled “deniers”.
You have perfectly illustrated the right argument. So the question is really, “by what mechanism other than world war are you going to force everyone on to the same tax and credit system”?
Maybe it is import/export and border adjustment, IDK. Interesting idea.
Some countries have a point-based system for immigration, why not reward those doing their parts for the planet?
Unless they vote against using coal
[1] - https://en.wikipedia.org/wiki/Carbon_fee_and_dividend
translation, exclude china and most other "developing" nations while increasing the Tax on "rich" nations, a tax that is regressive in nature and will impact the poor people living in "rich" nations the most...
By all accounts its already too late to stop the warming of the planet and we will have to learn to live with the consequences of our actions for the foreseeable future.
Even with wildfires raging across the northern hemisphere this year and in the southern hemisphere last year we keep on digging more coal and oil from the ground.
We keep on acting as if its business as usual. Move along, nothing to see here.
And no, renewable energy is not going to save us. We wont even reach 45% of renewable energy production worldwide for another 20 years at best.
Our global population keeps on increasing and we are depleting our natural resources at an ever faster pace than before therefore increasing deforestation and carbon emission.
All of this done in order to satisfy the need for our economies to grow no matter what the cost on our habitat is, and threatening a million species of animals/insects in the process.
There is a garbage island in the pacific and there will be soon more plastic in the ocean than fish. What a depressing thought.
If only we were the rational creatures that we think we are, maybe we would stop this madness and realize that we are driving at full speed towards a cliff.
I am afraid there is no hope for us.
We also need to stop thinking that renewable energy will save us. It wont. Maybe in 50 years, but its already too late as of now.
We need to stop ICE cars from being sold within the next 5 years and we need to start decreasing our population to reach a natural equilibrium with our global ecosystem.
Its time for the leaders of this world to acknowledge that we are in danger as a species.
It's time to call a spade a spade and its time to stop having pointless debates about climate change. Its time to act.
If you can maintain power by doing the exact opposite of your position then that is exactly what is going to happen. The conservative German party CDU gets 30% in Germany because people don't want things to change. The CDU is well known for pretending to care about the environment and then not doing anything, their voters don't see a problem in that, they like it that way.
Just need to point out that a price on carbon is a mechanism for achieving exactly this. The goal is to make emitting energy sources expensive enough that people shift to carbon free alternatives wherever possible.
In summary, climate change is a human problem, not a technological one. Technology has changed a lot and continues to do so, but the fundamentals of human psychology haven't really changed. We know of the problem, we have the technology to solve it, to the extent that it can be solved, but not the will and coordination to do so. Yet what reason do we have to believe that this will change in the future?
A political will is definitely lacking. One thing we cannot say, when the last forest has been cut down or was burned down during the soon to be longer summer months, when the food chains start collapsing due to the death of trillions of insects, is that we did not know.
We knew as far back as the 80s that this was going to happen but too often the human species likes to bury its head in the sand until its too late.
There is no reason to think that this will change anytime soon.
We, in tech like to think about technological solutions to a problem. In this case the tech is here. Its affordable, but we are not embracing it as we should.
Instead of committing to net zero in 2050, we should do the transition in less than a decade and then start capturing CO2 from the atmosphere after that. Yet here we are debating if we should or not start trading carbon credits between ourselves, as if there is nothing better to do.
Even when it makes financial sense people may be attached to the old way of doing things. They may drive an ICE car because they want to complete their 500 mile trip with one tank even though charging on the way only delays the trip by 30 minutes, something which is possible today.
There are inferior ways of achieving a goal that don't harm the planet. They often require a small sacrifice but they are possible today. When someone insists on an ICE because of a difference in range, they insist that engineers solve the impossible e.g. carbon capture [0] even though a possible solution exists.
That is the real problem. We collectively decide to create a problem that is impossible to solve and then we point at the engineers. They are already solving problems, you know, the solvable ones.
[0] By that I mean enough carbon capture to undo all the pollution that we didn't even try to prevent.
Of course, I know nothing about OP, have no professional knowledge, and could be way off. I just thought mentioning it might push someone to seek help. I won't mention it again.
---
Climate change is a hard problem, but not for the reasons you give. To me, it's mainly a "Collective Action Problem". I, my city, my state, or my country may do our part of what's needed to solve the problem, but it won't be worth anything if the rest of the world doesn't join in.
Worse, our sacrifices makes the problem less urgent for other regions, who can "free ride" on our efforts.
If there was "local global warming", and changing California's emissions would fix California's weather, I think it would long since be handled, despite the long term nature of the benefits.
https://www.britannica.com/topic/collective-action-problem-1...