Cap carbon, not CO2

Aldyen Donnelly
May 29 · 6 min read

First: a clean energy dividend doesn’t focus the role of government in the right place.

This is important because governments absolutely have a big and important role. The goal is to get fossil carbon out of energy, building products, and food supply chains at the scale and speed the science shows to be necessary. The most efficient way to get this done, unsurprisingly, would be to order reductions in fossil carbon content in those supply chains at the scale and speed the science shows to be necessary!

Second, a clean energy dividend won’t work without tariffs on imported goods and/or services.

A well-designed government policy to cut fossil carbon lets suppliers comply in a “sales portfolio average basis”. In other words, they must be disciplined in cutting emissions from across their supply chain as a whole by the required amount. But they have the freedom to decide where and how those reductions take place across their operations. As in all of the precedents (lead out of gasoline, sulfur out of diesel, etc.), a product standard that limits pollution precursor content can apply equally to all energy products, whether they are domestically produced or imported. This product standard does not need a complementary tariff on imports to make it work. Carbon tax schemes can only be effective if they include tariffs on imports. And when we add tariffs to the mix, we always add opportunities for gaming and unnecessary international conflicts.

Third, a clean energy dividend attempts to prescribe solutions from a centralized place. This tends not to work.

Instead, having set limits on fossil carbon content, a good pollution reduction policy gives obligated parties only three ways to earn ‘credits’ for anything beyond straight up reductions in the fossil carbon content of their global supply chains: reduce the precursors in one’s supply chain, trade for allowances with those with easier ability to reduce, or find other ways to actively remove the pollutant from the atmosphere.


Nori

Nori is on mission to reverse climate change. This is our blog.

Aldyen Donnelly

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Nori

Nori

Nori is on mission to reverse climate change. This is our blog.