cap-and-dividend
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Cap-and-trade primer goes to Washington (DC)
We all know that the devil’s in the details when it comes to legislation, and the American Clean Energy and Security Act, a.k.a. Waxman-Markey, is no exception. This 900-plus page proposal tackling climate change and clean energy is chock full of such fiendish facets. We at Sightline Institute carefully studied the climate portion of the […]
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A common person’s guide to the American Clean Energy and Security Act of 2009
On May 21, following months of work, the House Energy and Commerce Committee passed the American Clean Energy and Security Act of 2009, a 946-page piece of climate legislation. There have been mixed reactions from environmental and climate groups, but most groups are in agreement that it needs to be strengthened going forward. For some […]
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To get support for a climate bill, offer cash back to Americans, argues Rep. Chris Van Hollen
Rep. Chris Van Hollen (D-Md.) thinks he’s got the key to passing a climate bill this year: send every American a rebate. It’s not a bribe, but a dividend — and one he thinks will help grow support for legislation to cap carbon. Van Hollen, an up-and-coming Democratic leader and chair of the Democratic Congressional […]
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A flawed strategy: Why environmental groups should not be chasing carbon dollars
It’s easy to understand. We’ve had eight years of across-the-board hostility to sustainability investments by Bush & Co., and before that eight years of promises with no follow-through by the Clinton crowd. Now green groups are dazzled by the prospect of hundreds of billions of new dollars for mass transit, energy efficiency, and other projects, […]
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Beware utilities seeking free pollution permits
America’s electric utilities (PDF) are waging a no-holds-barred campaign to get 40% of carbon emission permits allocated free to local distribution companies and merchant coal generators. They argue that free allocation will protect consumers better than auctions and cash back. Just give us free permits, they say, and we’ll pass through the savings to our […]
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Cap-and-rebate is more robust in the face of carbon high prices
The other day, I used the fanciful example of $50,000-utility bills to illustrate how cap-and-rebate schemes can inspire energy efficiency and conservation. The numbers were deliberately exaggerated, but they highlight one of the features of cap-and-rebate that I like: the robustness of the system in the face of higher carbon prices. The political battle over […]
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How cap-and-rebate brings about carbon reductions
David Roberts asks: Who, in this scenario [carbon revenue rebated to consumers], has any new incentive to shift to low-carbon electricity or efficiency? Short answer: everyone. Let’s say I’m your utility, and I raise your energy prices so that, at present rate of consumption, your bill will rise to $50,000 per year. Pretend that energy […]
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How would rebating carbon revenue to taxpayers give anyone incentive to reduce emissions?
There are lots of people who want to return money raised by a carbon program back to taxpayers via rebates. (A “revenue neutral carbon tax” is one way to do this; “cap and dividend” is another; Obama’s proposal is to auction pollution permits and return roughly 80 percent of the revenue via payroll tax rebates.) […]
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Why it makes sense to use carbon revenue to fund efficiency programs
I wrote earlier about some Congressional Budget Office testimony before Congress on the “distributional effects of cap-and-trade.” There are a few more things in there I want to discuss. The CBO looked at three options for what to do with carbon revenue: rebate it to taxpayers, use it to lower corporate income taxes, or give […]