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Page added on March 23, 2018

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Introduction to carbon pricing

Regular readers of my blog will probably be familiar with most of the material but I hope they will be nevertheless be useful both as a refresher and a guide for people who are new to the area.

The three talks I’ve produced so far are:

1. An introduction to carbon pricing, which explains the idea of carbon pricing and looks at current using examples from practice around the world, both in summary and looking at the particular example of highly successful carbon pricing in the UK. This can be found here.

2. Types of carbon pricing, which looks at the merits of taxes and emissions trading systems, and looks in particular at hybrid systems, including California. This can be found here.

3. A more technical talk on the social cost of carbon, which includes some material that may be new even to those already quite familiar with climate change policy. It illustrates some of the difficulties of applying conventional economic concepts to a problem with as many dimensions as climate change, but concludes that they still have some value.  This can be found here.

The links together with supporting material (transcripts and slides) can be found on the tab at the top of this page labelled videos, or at this link.

Please pass the links on to anyone you think might find them of interest.

10 Comments on "Introduction to carbon pricing"

  1. dave thompson on Fri, 23rd Mar 2018 11:36 am 

    To start carbon pricing now would be to little to late.

  2. Anonymouse1 on Fri, 23rd Mar 2018 12:10 pm 

    Carbon pricing is more about feel-good, than doing good. These carbon pricing schemes have many flaws one could pick at, but the greatest one of them all is that none of these ‘carbon pricing’ schemes touch EXISTING subsidies for dirty energy production. Carbon pricing does nothing to correct the massive market failures that the current web of subsidies have created. CP simply tacks a (small) surcharge onto it all.

  3. Davy on Fri, 23rd Mar 2018 1:00 pm 

    Why not just tax bad energy behavior. Just think of all that revenue.

  4. Sissyfuss on Fri, 23rd Mar 2018 10:24 pm 

    More middlemen to suck off the carbon teet.

  5. jawagord on Sat, 24th Mar 2018 8:53 am 

    The carbon tax seems to be effective with utilities that have access to cheap natural gas to replace aging coal fired power plants with gas fired power plants. It isn’t effective in reducing energy use. As any economist could tell you, energy is an inelastic commodity, you can raise the price significantly with taxes and people will still use it in the same amount. The EIA even assumes a negative elasticity for gasoline use to explain increased consumption year to year. This makes the carbon tax a great tax for raising money, minimally effective at reducing CO2 emissions where substitution from coal to gas is possible, totally ineffective at preventing climate change because we will still be using copious amounts of fossil fuels, while paying an every increasing carbon tax (until a tax revolt throws the bums out).

  6. Anonymouse1 on Sat, 24th Mar 2018 1:03 pm 

    Then you understand the ‘real’ goal of carbon taxes perfectly Jag. These ‘taxes’ are just that, taxes. The ‘taxes’ are too insignificant to change peoples, or more importantly, corporate people’s, behavior in any significant way. As I said above, all these ‘taxes’ do, is add a small surcharge to the BAU’s cost-of-doing business. Since governments almost everywhere already charge taxes on ‘carbon’ through the existing tax codes, you have to wonder why they just don’t raise those taxes and call it day.

    But no, calling it a ‘carbon’ tax, inserts the illusion in peoples that the ‘government’ or society if you prefer, is serious about the problems created by dirty energy and is ‘doing something’ about it. DIrty polluters for their part, may not like, or publicly state they dislike carbon taxes, but they know deep down, the alternatives, potentially, are much worse. Again, like I mention, carbon taxes leave the current, toxic paradigm completely intact, corporate welfare and all.

  7. drwater on Sat, 24th Mar 2018 8:21 pm 

    “Then you understand the ‘real’ goal of carbon taxes perfectly Jag. These ‘taxes’ are just that, taxes.”

    Ah – No. British Columbia has a revenue neutral carbon tax that is working great. A revenue neutral carbon tax in the US WITH border adjustments would cut CO2 emissions 50% in 20 years and strongly incentivize China and India to do the same. See the REMI study at: The study is a few years old, but technological improvements have made things even better than the study assumptions.

  8. jawagord on Sun, 25th Mar 2018 12:16 am 

    I’d agree with you if you call increased emissions evidence the carbon tax is working great? Now do I need to post links on BC’s carbon tax is not revenue neutral?

  9. Cloggie on Sun, 25th Mar 2018 12:55 am 

    If you lower your pants and leave your droppings on the pavement in the center of the town, you are likely to get fined for “carbonizing” said pavement.

    So why not doing the same for CO2-farters aka cars.

    It is the best way to fine them out of existence or at least lower the frequency of usage.

  10. Anonymouse1 on Sun, 25th Mar 2018 2:04 am 

    I would like know to where BC got its data from, and the studies\data that show unambiguously that ’emissions’ are going down in BC. I have seen this claim on BCgov websites as well, but no links or citations to how they arrived at that sunny conclusion. If the data(which they do not provide) itself is questionable, and it is, then the notion that BC’s carbon tax is in some way, directly responsible, is even more tenuous. (IE bullshit). I say this not because I don’t think polluters should not be taxed, I do, but because the governments claims on this matter sound a little too good to be true.

    drwater, has is either a shill, misinformed, or likes to take gov statements at face value. The question is not, whether taxing the hell out of dirty polluters *could* work, that is not what is being stated. Rather, that that so-called ‘carbon taxes’ as they currently are being implemented, are not really achieving any of their (stated) goals. Well, besides raising revenue, that part IS working as intended.

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