WHAT TO DO ABOUT CARBON: TRADE IT, TAX IT, BURY IT

Trade It?
This trade in carbon emissions won't combat global warming
There are much more honest and sustainable ways of dealing with climate change, says Peter Bunyard
July 21, 2006 (The Guardian)

- Europe's gas emissions trading scheme is in disarray…The 11 governments now "face warnings of legal action from the European commission". In fact, the scheme may well prove unworkable, not least because British industry feels it is being unfairly treated in comparison with France and Germany, which are actually calling for emission allowances that would exceed their emissions of several years' back.
- It is questionable whether carbon emissions trading will bring a certifiable reduction. As now embodied in the EU emissions trading scheme, fossil- fuel-burning companies such as power utilities, steelworks or cement factories are granted substantial carbon credits that they can sell - on the basis that they have emitted less than expected. That may provide some incentive to look to more efficient technologies, but the assumption is that someone elsewhere, even in another country, is going to buy that credit in order to pollute.
- How relevant are such schemes when deforestation, particularly in the tropics, results in tens of times more carbon emissions than putatively captured by all CDM schemes put together? Perhaps a carbon tax that could be ploughed back into carbon-reducing schemes, even by the original emitter, would be much fairer and less prone to abuse.
Tax It:
Properly designed carbon tax could help Canada battle global warming
Jon Kesselman, July 03, 2006 (Vancouver Sun)

- Is a carbon tax the bogeyman that many federal and provincial politicians and industry representatives contend? Or could it serve a constructive role in improving Canada's environmental and economic performance?
- Carbon tax proposals were first advanced by economists and later endorsed by environmentalists. In essence, such taxes would put a price on the greenhouse gas emissions from production and consumption activities. Some "green" advocates have promoted a major "tax shift" whereby taxes applied to environmentally damaging activities would be used to reduce taxes on productive activities…
- The policy finesse is to use the additional revenues from a carbon tax to reduce the burdens of other major taxes, such as personal and corporate income taxes. Then individuals and industry alike could become net gainers…[A]pplying carbon tax revenues to reduce tax rates on productive activities has been called a "double dividend." Society would achieve a cleaner environment, with less global warming, while also improving incentives for productive work and business activities…
As usual, the U.S. is way behind the curve on environment-protecting ideas:
The Big Idea: An Energy Tax
by Charles Wheelan, Ph.D., July 5, 2006, (The Naked Economist @ Yahoo.com)
- I had lunch not long ago with a fund-raiser for a prospective presidential candidate. He admitted that his candidate is still looking for a "big idea."
- …I will offer a "big idea" for whoever wants to take it. Since this proposal isn't inherently liberal or conservative (arguably it's both), it would work for a Republican or a Democrat, provided he or she has the backbone for it.
- …Create a carbon tax -- basically a tax on energy calculated based on its carbon content -- and use the new revenue to provide offsetting cuts in the income tax, the payroll tax (the tax on wages used to fund Social Security), or both.
- The whole package should be revenue neutral, meaning that it will not increase or decrease the total amount of revenue the government collects...
Bury it: SEQUESTRATION
Carbon Sequestration was highlighted on Tom Brokaw’s Discovery Channel essay, GLOBAL WARMING. How does it work?

- One approach being considered to help mitigate CO2 concentrations is geologic carbon sequestration…CO2 emissions are captured from sources such as power plants and refineries and injected into underground formations—for example, old oil or gas fields or deep, briny aquifers—where the gas can be permanently isolated…
- Each year, [Norway’s state oil company] Statoil injects about 1-million tons of CO2 recovered from its offshore Sleipner site into a saline geologic formation under the North Sea. The amount of CO2 being sequestered is equivalent to the output of a 150-megawatt coal-fired power plant. Statoil pursued the sequestration effort after Norway imposed a federal tax on atmospheric CO2 emissions from combustion-based sources. The Sleipner site is the first and largest commercial CO2 geologic sequestration facility in the world, and it is proving to be both environmentally and financially sound…
One thing is certain:

We can't keep burning it at the rates we have been.