A carbon tax is a tax levied on the carbon emissions required to produce goods and services. Carbon taxes are intended to make visible the "hidden" social costs of carbon emissions, which are otherwise felt only in indirect ways like more severe weather events. In this way, they are designed to reduce carbon dioxide (CO
2) emissions by increasing prices of the fossil fuels that emit them when burned. This both decreases demand for goods and services that produce high emissions and incentivizes making them less carbon-intensive. In its simplest form, a carbon tax covers only CO2 emissions; however, it could also cover other greenhouse gases, such as methane or nitrous oxide, by taxing such emissions based on their CO2-equivalent global warming potential. When a hydrocarbon fuel such as coal, petroleum, or natural gas is burned, most or all of its carbon is converted to CO
2. Greenhouse gas emissions cause climate change, which damages the environment and human health. This negative externality can be reduced by taxing carbon content at any point in the product cycle. Carbon taxes are thus a type of Pigovian tax.
Energy is sustainable if it "meets the needs of the present without compromising the ability of future generations to meet their own needs". Most definitions of sustainable energy include considerations of environmental aspects such as greenhouse gas emissions and social and economic aspects such as energy poverty. Renewable energy sources such as wind, hydroelectric power, solar, and geothermal energy are generally far more sustainable than fossil fuel sources. However, some renewable energy projects, such as the clearing of forests to produce biofuels, can cause severe environmental damage. The role of non-renewable energy sources in sustainable energy has been controversial. Nuclear power is a low-carbon source whose historic mortality rates are comparable to wind and solar, but its sustainability has been debated because of concerns about radioactive waste, nuclear proliferation, and accidents. Switching from coal to natural gas has environmental benefits, including a lower climate impact, but may lead to a delay in switching to more sustainable options. Carbon capture and storage can be built into power plants to remove their carbon dioxide emissions, but is expensive and has seldom been implemented.
The Regional Greenhouse Gas Initiative (RGGI, pronounced "Reggie") is the first mandatory market-based program to reduce greenhouse gas emissions by the United States. RGGI is a cooperative effort among the states of Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Vermont and Virginia to cap and reduce carbon dioxide (CO2) emissions from the power sector. RGGI compliance obligations apply to fossil-fueled power plants 25 megawatts (MW) and larger within the 11-state region. As of 2021, Pennsylvania is pending RGGI membership with an anticipated start in early 2022, and North Carolina is currently considering joining RGGI.
The Global Warming Solutions Act of 2006, or Assembly Bill (AB) 32, is a California State Law that fights global warming by establishing a comprehensive program to reduce greenhouse gas emissions from all sources throughout the state. AB32 was co-authored by then-Assemblymember Fran Pavley and then-Speaker of the California Assembly Fabian Nunez and signed into law by Governor Arnold Schwarzenegger on September 27, 2006.
The United States produced 5.2 billion metric tons of carbon dioxide equivalent greenhouse gas (GHG) emissions in 2020, the second largest in the world after greenhouse gas emissions by China and among the countries with the highest greenhouse gas emissions per person. In 2019 China is estimated to have emitted 27% of world GHG, followed by the United States with 11%, then India with 6.6%. In total the United States has emitted a quarter of world GHG, more than any other country. Annual emissions are over 15 tonnes per person and, amongst the top eight emitters, is the highest country by greenhouse gas emissions per person. Because coal-fired power stations are gradually shutting down, in the 2010s emissions from electricity generation fell to second place behind transportation which is now the largest single source. In 2020, 27% of the GHG emissions of the United States were from transportation, 25% from electricity, 24% from industry, 13% from commercial and residential buildings and 11% from agriculture. These greenhouse gas emissions are contributing to climate change in the United States, as well as worldwide.
Emission trading (ETS) for carbon dioxide (CO2) and other greenhouse gases (GHG) is a form of carbon pricing; also known as cap and trade (CAT) or carbon pricing. It is an approach to limit climate change by creating a market with limited allowances for emissions. This can lower competitiveness of fossil fuels and accelerate investments into low carbon sources of energy such as wind power and photovoltaics. Fossil fuels are the main driver for climate change. They account for 89% of all CO2 emissions and 68% of all GHG emissions.
Greenhouse gas emissions by Australia totalled 533 million tonnes CO2-equivalent based on greenhouse gas national inventory report data for 2019; representing per capita CO2e emissions of 21 tons, three times the global average. Coal was responsible for 30% of emissions. The national Greenhouse Gas Inventory estimates for the year to March 2021 were 494.2 million tonnes, which is 27.8 million tonnes, or 5.3%, lower than the previous year. It is 20.8% lower than in 2005. According to the government, the result reflects the decrease in transport emissions due to COVID-19 pandemic restrictions, reduced fugitive emissions, and reductions in emissions from electricity; however, there were increased greenhouse gas emissions from the land and agriculture sectors.
The American Clean Energy and Security Act of 2009 (ACES) was an energy bill in the 111th United States Congress that would have established a variant of an emissions trading plan similar to the European Union Emission Trading Scheme. The bill was approved by the House of Representatives on June 26, 2009, by a vote of 219–212. With no prospect of overcoming a threatened Republican filibuster, the bill was never brought to the floor of the Senate for discussion or a vote. The House passage of the bill was the "first time either house of Congress had approved a bill meant to curb the heat-trapping gases scientists have linked to climate change."
The climate change policy of the United States has major impacts on global climate change and on global climate change mitigation. This is because the United States is the second largest emitter of greenhouse gasses in the world after China, and is among the countries with the highest greenhouse gas emissions per person in the world. In total the United States has emitted over 400 billion metric tons of greenhouse gasses, more than any country in the world.
Proposition 23 was a California ballot proposition that was on the November 2, 2010 California statewide ballot. It was defeated by California voters during the statewide election by a 23% margin. If passed, it would have suspended AB 32, a law enacted in 2006, legally referred to its long name, the Global Warming Solutions Act of 2006. Sponsors of the initiative referred to their measure as the California Jobs Initiative while opponents called it the Dirty Energy Prop.
A carbon fee and dividend or climate income is a system to reduce greenhouse gas emissions and address climate change. The system imposes a carbon tax on the sale of fossil fuels, and then distributes the revenue of this tax over the entire population as a monthly income or regular payment.
A carbon pricing scheme in Australia was introduced by the Gillard Labor minority government in 2011 as the Clean Energy Act 2011 which came into effect on 1 July 2012. Emissions from companies subject to the scheme dropped 7% upon its introduction. As a result of being in place for such a short time, and because the then Opposition leader Tony Abbott indicated he intended to repeal "the carbon tax", regulated organisations responded rather weakly, with very few investments in emissions reductions being made. The scheme was repealed on 17 July 2014, backdated to 1 July 2014. In its place the Abbott Government set up the Emission Reduction Fund in December 2014. Emissions thereafter resumed their growth evident before the tax.
Citizens' Climate Lobby (CCL) is an international grassroots environmental group that trains and supports volunteers to build relationships with their elected representatives in order to influence climate policy. The CCL is a registered 501(c)(4) with approximately $680,000 in revenue in the United States in 2018. Operating since 2007, the goal of CCL is to build political support across party lines to put a price on carbon, specifically a revenue-neutral carbon fee and dividend (CF&D) at the national level. CCL is supported by notable climate scientists James Hansen, Katharine Hayhoe, and Daniel Kammen. CCL's advisory board also includes former Secretary of State George P. Shultz, former US Representative Bob Inglis, actor Don Cheadle, and RESULTS founder Sam Daley-Harris.
British Columbia's carbon tax and accompanying tax shift has been in place since 2008. It is a British Columbia policy which adds additional carbon taxes to fossil fuels burned for transportation, home heating, and electricity, and reduces personal income taxes and corporate taxes by a roughly equal amount. The carbon tax is collected at the point of retail consumption.
The Clean Power Plan was an Obama administration policy aimed at combating anthropogenic climate change that was first proposed by the Environmental Protection Agency (EPA) in June 2014. The final version of the plan was unveiled by President Obama on August 3, 2015. Each state was assigned an individual goal for reducing carbon emissions, which could be accomplished how they saw fit, but with the possibility of the EPA stepping in if the state refused to submit a plan. If every state met its target, the plan was projected to reduce carbon emissions from electricity generation 32% by 2030, relative to 2005 levels, as well as achieving various health benefits due to reduced air pollution.
Washington Initiative 732 (I-732) was a ballot initiative in 2016 to levy a carbon tax in the State of Washington, and simultaneously reduce the state sales tax. It was rejected 59.3% to 40.7%. The measure appeared on the November 2016 ballot. The backers of I-732 submitted roughly 350,000 signatures in December 2015 to certify the initiative.
Green economy policies in Canada are policies that contribute to transitioning the Canadian economy to a more environmentally sustainable one. The green economy can be defined as an economy, "that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities." Aspects of a green economy would include stable growth in income and employment that is driven by private and public investment into policies and actions that reduce carbon emissions, pollution and prevent the loss of biodiversity.
Carbon pricing in Canada is implemented either as a regulatory fee or tax levied on the carbon content of fuels at the Canadian provincial, territorial or federal level. Provinces and territories of Canada are allowed to create their own system of carbon pricing as long as they comply with the minimum requirements set by the federal government; individual provinces and territories thus may have a higher tax than the federally mandated one but not a lower one. Currently, all provinces and territories are subject to a carbon pricing mechanism, either by an in-province program or by one of two federal programs. As of April 2022 the federal minimum tax is set at CA$50 per tonne of CO2 equivalent, set to increase to CA$170 in 2030.
The Energy Innovation and Carbon Dividend Act of 2019 is a bill in the United States House of Representatives that proposes a fee on carbon at the point of extraction to encourage market-driven innovation of clean energy technologies to reduce greenhouse gas emissions. The fees are recycled to citizens in monthly dividends. The act was originally introduced in 2018 with bipartisan support from six co-sponsors and died when the 115th congress ended on 3 January 2019. It is principally based on Citizens' Climate Lobby's carbon fee and dividend proposal, and this organization advocates for the bill.
Proposition 30 is a California ballot proposition that appeared in the general election on November 8, 2022. The measure was defeated. The initiative would have raised taxes on the wealthy to fund wildfire management and electric vehicle incentives and infrastructure.
