The price of carbon dioxide and other greenhouse gas emissions has long been a preferred mode of an argument between economists and activists to address the nation against climate change. The concept is simple: to put a fee on the nationwide carbon emissions and hand back the revenue to the masses.
On November 28, five members of US house of representatives came together, sponsored by some prominent people of both the parties, proposed the Energy Innovation and Carbon Dividend Act to bring climate change under control and reduce the level of carbon emissions. The policy aims to promote energy innovation, lower health costs, create jobs and empower consumer spending.
The Centre on Global Energy Policy (CGEP) at Columbia University, released four research papers covering the basics of the impact that carbon fee might have. The reports mostly covered the dynamics of the carbon taxes. A number of facts were communicated like-
- Carbon taxes can lower emissions in the environment. This article pivoted around three shared scenarios and all of them concluded that carbon fee would cover almost 80% of the economy’s total greenhouse emissions.
- The carbon fee would rapidly accelerate the shift from coal and towards more renewable electricity. But the reports also suggested that the impact on production and consumption of natural gas will be less.
- Roughly 80 percent emissions reduction will be in the power sector, caused by the carbon fee. While the emissions in the transport sector will only be reduced by 2 percent.
- The Macroeconomic success of the carbon tax will depend on how the revenue is spent by the government.
- The analysis showed that the US is unlikely to meet its target under the current policy when put under a $50-ton scenario.
Both the government and the oil & gas companies can witness the writing on the wall. The effects of climate change on the economy, health, and national security among others will increase over time. Even huge players like ExxonMobil have come forward to support the carbon fee on emissions. This new policy will reduce America’s emissions by at least 40% within 12 years and will be a giant leap towards a greener and a brighter future.