Carbon tax is the way ahead
AP File Photo
Exhaust rises from smokestacks in front of piles of coal at NRG Energy’s W.A. Parish Electric Generating Stationin Thompsons, Texas.
What would happen if the government clamped a tax on carbon emissions?
Those who regard the idea of imposing a carbon tax as a nonstarter in our current political climate ought to consider Ireland’s surprising success with environmental taxation.
Three years ago, after its economy collapsed as a result of loose credit policies, Ireland imposed taxes on most of the fossil fuels used by homes, offices, vehicles, farms and industries. Just about everything is targeted — even household trash.
The Irish, who were among Europe’s highest per-capita producers of greenhouse-gas emissions, with levels approaching those in the United States, changed their ways. They shifted to alternative fuels and more energy-efficient cars and began recycling in earnest.
As a result, Ireland’s emissions have dropped more than 15 percent since 2008. And, as an added bonus, the revenue from carbon taxes has played a crucial role in helping Ireland reduce its deficit and avert a rise in income tax rates. This is a remarkable development that hasn’t gotten the attention it deserves.
Ireland is not the only country to adopt carbon taxes. Some of Europe’s healthiest economies, like Sweden, Denmark and the Netherlands, have taxed carbon emissions since the early 1990s, and Japan and Australia have introduced them more recently. But considering the sorry state of Ireland’s economy in recent years, few people believed carbon taxes would work. In fact, they have succeeded in reducing greenhouse gases faster than even government authorities expected.
And therein could lie hope for a concerted international effort to reduce emissions to safe and acceptable levels. But a number of things are going to have to change, particularly here at home.
Although the EPA is preparing to promulgate regulatory controls on power plant emissions of carbon dioxide, a tax on fossil fuels would produce results a lot sooner. The prognosis for the future of global climate change is indeed alarming — sea levels are expected to rise significantly, drought and wildfires and violent storms like Hurricane Sandy will strike more often and much harder. And much of this change is expected within the next 50 years.
What to do? We can’t escape the likelihood that, over the next 25 years, if China and India grow as much as South Korea has since 1980, those two countries alone will consume three times as much energy as the United States does today. World coal reserves are huge. Where it is plentiful — as in China and India — coal is the economic fuel of choice for electricity production, despite the development of renewable technologies such as wind and solar.
Emerging economies are thus bound to remain largely dependent on coal for the foreseeable future. Unfortunately, coal combustion contributes about 40 percent of the global industrial emissions of carbon dioxide.
So there is an urgent need to find practical and economic technologies and policies that permit the continued use of coal without increasing carbon emissions into the atmosphere. We can help coal-consuming countries reduce their emissions by developing and demonstrating systems for carbon capture and storage. This involves capturing the gas produced by coal combustion and burying it in deep geological formations or depleted oil and gas wells.
We can also offer an alternative to fossil fuels by developing clean-energy technologies. Advanced batteries and other energy-storage systems for electric vehicles and the electric-power grid to support solar and wind power are within reach.
So are new advances in nuclear power, an energy source that is carbon-free and right for hybrid and all-electric cars. The most promising nuclear option is a small modular reactor, which can be built in a factory for a fraction of the cost of a large nuclear plant and shipped to a nuclear site for installation anywhere in the world. The International Atomic Energy Agency said in a recent report that “nuclear power has the greatest potential to reduce emissions at the lowest cost.”
The way forward requires that the U.S. government impose a carbon tax, with the resulting revenues allocated specifically for the development of those technologies — principally carbon capture and storage, advanced batteries and nuclear power — that are essential to global efforts to fight climate change. That would still leave plenty of money for deficit reduction, as it has in Ireland.
Working to realize the full potential of U.S. energy technologies offers a significant economic and environmental opportunity. U.S. energy industries could be the principal beneficiaries of international demand for such advances.
It’s time to drop the taboo against a carbon tax and start using the revenue to develop innovative technologies that are practical and can make a contribution toward carbon mitigation and a healthy economy. That would give us a fighting chance to control our own destiny.
Bob N. Leach is a retired radiation safety officer and senior reactor operator. He lives in Brattleboro.