Skip to content

Price Carbon Now

From Citizens Climate

  • Carbon Fee and Dividend legislation puts a fee on the amount of carbon dioxide in fossil fuels.  This fee is assessed at the source of the fuel: at the mine, well, or port of entry. The fee starts out low and increases annually in a predictable manner until green energy is competitive with fossil fuel.  The fee is collected and 100 percent reimbursed to all citizens, shielding them from the financial impact of the transition to a clean energy economy. Because the fee (and the price of fossil fuel) goes up predictably over time, it sends a clear price signal to begin using fossil fuels more efficiently or replace them with green energy.  Investment flows to green technologies and the rising cost of fossil fuels increases the demand for these products, making them even less expensive as they reach mass production.  This clear easy to understand price signal (increasing fossil fuel costs and decreasing green technology costs) drive the transition to a green economy.  This transition will reduce greenhouse gases stabilizing, our climate and the health of our oceans.

Pricing carbon is necessary. Carbon Fee & Dividend legislation will put us on the path of a sustainable climate by reducing our greenhouse gas emissions and transitioning us to a clean energy economy. Since the beginning of the industrial revolution we have increased the level of greenhouse gases, especially carbon dioxide (CO2), in our atmosphere.  Scientists warn that this is having a drastic affect on our climate. Changes that would normally take thousands of years are happening in decades.  In effect, we have covered the earth with a large blanket of greenhouse gases and the earth is warming up.  The oceans are absorbing this increased carbon dioxide in the atmosphere, making them more acidic. Eventually, this acidity will affect the oceans’ ability to support life.

What is a carbon fee?  It is a fee based on the amount of carbon in a fossil fuel.  Fossil fuels such as oil, gas and coal contain carbon. When burned they release the potent green house gas, carbon dioxide (CO2), into the atmosphere.  The fee is based on the tons of carbon dioxide the fuel would generate, and it would be collected at the point of entry — well, mine or port.  The fee would start out low — $15 per ton — and gradually increase $10-$15 each year.  The amount would be determined by the government.

For more on Carbon Fee & Dividend, go to Citizens Climate

If you are wondering why Carbon Fee & Dividend and  not a Cap & Trade mechanism, I’ve heard it described this way: “Our planet has a fever, and instead of sending in the doctors, we are sending in derivative traders from Wall Street, the same guys (from Enron and Goldman Sachs, etc) who brought us the stock market crash of 2008.”

Citizens Climate Lobby puts it this way:

Cap and Trade was used by some early signers of the Kyoto Protocol, the first international treaty to address climate change.  Though most early adopters tried hard to make it work, Cap and Trade was not easy to understand, energy prices swung wildly, consumers paid the whole cost of the experiment, and it was not very effective in reducing total CO2 emissions.  Much of the reason for this was because of offset credits.  Power providers could buy offset credits that allowed them to burn more fossil fuels, but the offset credits did not actually reduce total CO2 emissions.   Carbon traders and offset investors made lots of money.  Utilities and manufacturers had increased costs that were passed on to the consumer.  No real reduction in CO2 was achieved and the consumer was stuck with the bill.  Carbon Fee and Dividend, on the other hand, is easy for everyone to understand, it gives the end consumer 100 percent of the proceeds of the carbon fee to help pay for the transition to clean energy, there are no offset credits or carbon credits to manipulate and no one technology is singled out to win or loose.  Only with inaction over several years do you become disadvantaged.  With action you become more efficient and competitive.  The free market picks the winning and losing technologies. Green energy and efficiency measures become cost competitive as prices rise for fossil fuels. As we transition to green technologies and green energies, CO2 emissions are reduced. Investments in green energy spur the development of innovative technologies that we export to other countries. America regains leadership in the green revolution.            

For a great summary, see “Story of Cap & Trade”:


For more on the economic benefits of pricing carbon and transitioning to a green economy, see the very  Regional Economic Models, Inc (REMI) report commissioned by CCL USA in the spring of 2014. In June 9, 2014, Citizens Climate Lobby released the study that examined the impact of a steadily-rising fee on carbon-based fuels with revenue from that fee returned to households in equal shares. With the fee starting at $10 per ton of carbon dioxide and rising $10 per ton each year, the major findings were:

  • In 20 years, CO2 emissions would be reduced 50 percent below 1990 levels.
  • Because of the economic stimulus of recycling carbon fee revenue back to households, in 20 years, 2.8 million jobs would be added to the American economy.

Click here to read more.

See another CCL resource:

Building A Green Economy: The Economics of Pricing Carbon & The Transition To Clean, Renewable Fuels

No comments yet

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: