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To meet America’s Paris pledge, climate policy Avengers must assemble

Posted on 24 September 2021 by dana1981

This is a re-post from the Citizens' Climate Lobby Blog

To meet our share of greenhouse gas emissions cuts as part of the Paris target to limit global warming to well below 2°C (3.6°F) above pre-industrial levels, the United States has committed to cutting emissions by 50–52% below 2005 levels by 2030. Thanks to increasingly clean electricity generation, America has already made some progress toward this goal, currently sitting at about 15–20% below 2005 levels, but that still leaves a long way to go without a lot of time left to clean up our act.

That’s why the budget reconciliation package currently under consideration by Congress is so critically important. According to a new analysis from Resources from the Future (RFF), an independent and nonprofit research institution, simply continuing current climate policies would leave the U.S. more than halfway short of its Paris contribution, at just 23% below 2005 emissions levels in 2030. RFF and Rhodium Group, another independent research organization, both analyzed how close some of the major climate policies currently under consideration by Congress would bring the U.S. to its Paris pledge.

The evaluated policies

Both groups evaluated the clean energy and electric vehicle tax credits and incentives as well as the Clean Electricity Performance Program (CEPP) included in the outlined legislation. The CEPP as currently drafted by the House Committee on Energy & Commerce (the Senate has yet to weigh in) would offer financial grants to utilities that increase their annual share of clean electricity by at least 4% and charge fines to those who miss that goal. 

Rhodium’s analysis also incorporated the proposed fee on methane pollution from oil and gas operations, as well as funding for agricultural and forestry programs that achieve carbon removal through soil conservation and reforestation.

In addition to tax incentives and the CEPP, RFF also evaluated the carbon fee under consideration by the Senate Finance Committee in its analysis. The committee’s proposed carbon price would begin at $15 per ton of carbon dioxide generated from burning fossil fuels and rise at an unspecified rate. RFF mainly focused on a scenario in which the carbon price rises slowly at first (by $1 per ton 2024 then $2 in 2025, $3 in 2026, $4 in 2027, then $5 in 2028) before increasing by $10 per ton per year starting in 2029, at that point mirroring annual carbon price increase in the Energy Innovation and Carbon Dividend Act. In a secondary scenario, RFF considered a carbon price starting at $15 per ton in 2023 and rising slowly at 5% per year.

What did they find?

The key finding in both the RFF and Rhodium analyses is that these key policies can achieve most of America’s pledged emissions cuts, but none are sufficient on their own. According to Rhodium’s analysis, the clean technology tax credits, CEPP, methane fee, and agriculture and forestry carbon removal funding will curb US greenhouse gas emissions to about 39% below 2005 levels by 2030.

RFF’s analysis is a bit more optimistic, estimating that the tax credits and CEPP alone could achieve 39% emissions cuts, as could the slower-rising carbon fee considered by the group. The more ambitious carbon fee would cut emissions by about 44% below 2005 levels by 2030, if gasoline were exempted. The emissions cut would improve to 45% if gasoline were subject to the carbon price. A separate analysis released by Senate Majority Leader Schumer’s office estimated that the measures included in the bipartisan and reconciliation packages so far (including a methane fee but not a carbon price) would achieve 45% emissions cuts by 2030.

The common thread among all these analyses is that none meets America’s Paris commitment to reduce greenhouse gas emissions 50–52% by 2030. 

But there’s good news! RFF also evaluated a scenario in which the final packages include all three: clean technology tax incentives, a CEPP, and a carbon pollution price. In that case, using the more ambitious of its two carbon pricing scenarios, RFF found that the U.S. would achieve 50% emissions cuts by 2030 even if gasoline is exempted from carbon pricing, or 52% if it’s included. Based on this analysis, which doesn’t include other measures like a methane fee, America would meet its newly strengthened Paris pledge.

No such thing as ‘too much climate policy’

The lesson here is that meeting America’s climate commitments is a major challenge, and the more climate policies we implement, the better our chances of achieving those goals. Tax credits and a CEPP would make a big dent by decarbonizing the electricity sector and helping the transition toward electric vehicles, but as the RFF analysis found, a carbon fee would speed up that process by incentivizing immediate emissions cuts while the CEPP ramps up. RFF also found that a carbon fee would lead to significantly reduced carbon emissions in other key sectors, especially from industry and buildings.

In short, these policies are complementary, and the more we implement, the more we reduce the risks and consequences of extreme climate change damages. When it comes to climate policies, there is no such thing as “too much.” Whatever Congress can pass — clean technology tax incentives, funding for agricultural and forestry carbon sequestration, funding for better public transit, a CEPP, prices on methane and carbon, etc. — will improve our chances to meet the Paris targets. As in the final scene of “Avengers: Endgame,” we need every climate ally to win the day.

To paraphrase Captain America: Climate Avengers, assemble!

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Comments 1 to 3:

  1. The point of a fee and dividend system is NOT to raise any revenues, but to make products and processes which produce high levels of greenhouse gas emissions more expensive to buy than the cleaner greener alternatives. That is what the fee should be set to achieve - nothing else. The dividend part is what would make the fee acceptable to the voting millions.

    The concept can get corrupted by left wingers who want to see it as a 'back door' way of taxing the rich, but dividend'ing ALL revenues back to the public, equally divided up per capita, has numerous advantages, not least that it would require virtually no complex administration, but primarily that it would cushion the less well off against the initial price rises that would follow the introduction of such a fee. Low income people and the 'poor', at least those who are not high producers of greenhouse gases, would receive the equivalent of a 'citizen's income' thus welfare expenditure could be reined back a little.

    The amount going back to 'the rich' as a percentage of the total revenue raised would, in actuality, be quite small because - duhhr - there are far fewer 'rich' than poor. With no discrimination based political ideology it would make the fee and dividend far more likely to be voted for by everybody, not just the left. It would also doubly reward those rich who already endeavour to live a low carbon lifestyle - yes! they do exist and so do the poor who choose a high carbon lifestyle too...
    Everybody getting back the same dividend should blunt any political objections based on the idea that government just wants to tax people to raise revenues, and the insinuations that the reasons given for raises are just fig leaves covering up the real intent.

    The fee should put 'the market' back on track, after 200 years+ of derailment, by acting as what economists call a price signal protecting 'the commons'. Humankind's treatment of 'the commons' as a 'free' resource to be used and abused is just about the sole reason for pollution, over exploitation of natural resources, bio-diversity loss etc. Price in the cost of using the commons and get the accountants to put those costs onto the financial bottom line of corporations and the world would transform itself at lightning speed without any need for heavy handed government or no need to restrict peoples' 'freedoms with authoritarian regulations.

    Get the great mass of the public willingly 'voting with their wallets' for the newly cheaper (and more profitable) green products and services and, more importantly, rejecting the newly more expensive 'carbon heavy' alternatives, and the job will get done by the 'invisible hand' of the market astonishingly quickly, effectively and efficiently whilst also partially addressing excessive income inequality and providing a 'food, shelter and warmth' safety net for the very poorest and most deprived.

    This would set off an extraordinarily powerful change in consumer behaviour almost overnight and would render quite a lot, possibly all, of the 'trillion dollar green initiatives' unnecessary.

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  2. The world also needs the USA to enact the “SEC. 9908. Carbon border fee adjustment.” aspects of
    H.R.2307 - Energy Innovation and Carbon Dividend Act of 2021

    - so Australia & other Climate Laggards are forced start to act responsibly.

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  3. Conservatively limiting harm done requires more, and more aggressive, actions than may be considered to be necessary to limit harm done. It especially requires more helpful, less harmful, leadership actions by the wealthiest and most powerful.

    Framing a problem to ensure it is well understood is essential to effectively solve the problem. The climate change problem raises an important “framing” question. What is now required because of the lack of responsible leadership by “All of the wealthiest and most powerful” through the past 30 years?

    The failure of leadership action on climate change impacts, and other harm reduction issues, by winners of competition for superiority relative to others is understandable. Allowing and excusing harmful actions that offer a competitive advantage in the competition for perceptions of superiority creates an environment that will motivate the development of harmful behaviour. It is also easy to understand that it is difficult to develop solutions that effectively address and correct for those social-political-economic market competition failures because of the powerful resistance to learning about things that would lead to more rapid corrections of harmful unsustainable developments. Especially challenging is the ability of political misleading marketing to:

    • Support leaders who resist the actions that are understandably required to limit harm done and make amends, or assign penalties, for harm done
    • Attack and discredit anyone who would try to raise awareness and improve understanding of what is harmful and required changes of harmful unsustainable developments, especially when those developments are popular and profitable for the more fortunate, more influential, portion of the population.

    It is important to remember the harmful reality of the popular dogmatic Belief that “increased Freedom for people to believe whatever they want to believe and do whatever they desire to do” is the best way for things to be, and that it will produce lasting improvements for each person, each group, and all of humanity. That is a version of the “wide-open to interpretation” call for Liberty to pursue Happiness. (see footnote 1: A Bit on Ethics).

    It may appear nonsensical to argue against Freedom or to argue that Winners are undeserving. But the evidence and improving understanding of what is harmful and what is fair and just is increasingly biased against the dogma of “Freedom” and “All Winners are Deserving” and any of its many ideological incarnations.

    The measure of improvement is “leaving things better than they were found”. Lasting improvements only develop when the pursuit of increased awareness and improved understanding of what is harmful (like accumulating climate change impacts) and what is unsustainable (like burning up non-renewable buried ancient hydrocarbons) governs, limits, and corrects actions and developed results.

    Everybody’s choices about learning, what they will learn and what they will not, and their resulting actions and inaction, add up to become the future. It is important to avoid the “tragedy of the commons” that can develop when individual or group pursuits of benefit add up to produce harmful unsustainable results. The rich and powerful cannot be excused for failing to learn to be less harmful. But the less fortunate who aspire to develop to live like the richer people can be excused for being tempted to aspire to the harmful examples set by Winners.

    The lack of that understanding governing and limiting past developments has created harmfully over-developed beliefs and activity that are popular and profitable. There is now an undeniable need to un-develop many things that have become popular and profitable. That includes correcting developed perceptions of superiority between people or groups. That understanding is required to develop a sustainable future for humanity. (see footnote 2: A Bit on Politics)

    The Sustainable Development Goals are robust, constantly improving and open to improvement, evidence-based understandings, like the climate change impact understanding presented in the IPCC Reports. And the 2020 Human Development Report is a detailed robust presentation of understanding that includes the understanding that developed measures of superiority, like GDP per-capita, are not legitimate indications of sustainable superiority. Increased GDP per-capita, or number of billionaires in a culture, are not measures of success or improvement. When the measures of success are harmfully incorrect then developed perceptions of status will need to be corrected.

    The richest portion of the global population have had 30 years to show leadership on the required changes of ways of living and profiting. The failure of the games, that the rich and powerful made the rules for, to get all of the rich and powerful to be more helpful, less harmful, leaders indicates the need for the system to change. The currently rich and powerful cannot be allowed to compromise the awareness and understanding of what is harmful and the required actions to correct incorrect perceptions of superiority relative to others.

    Possible actions to motivate all of the wealthier and more powerful individuals would be:

    • giving credit for verifiable carbon reduction actions taken since 2015.
    • penalties for the current wealthier people who have tried to increase how much benefit they get from harmful unsustainable activity
    • severe penalties for wealthier people who have a history, especially a recent history, of trying to delay or discredit the development of increased awareness and improved understanding of the required corrections of what has developed.

    Helping the less fortunate through the rapid transition to less harmful ways of living is also required. Lower income people face more of a burden from a carbon fee, even with an equal rebate to everyone. An improved way to rebate would be having the carbon fee fully rebated equally, but only to middle income and poorer people (like families with reported income below $120,000 or individuals with reported income below $60,000). Also, there should be funding for Charities and NGOs to help all the less fortunate, especially the homeless, submit income tax statements with the rebate system set up to ensure they receive their rebates, perhaps getting the rebate at the time that their “zero or near-zero income statements” are submitted.

    Footnote 1: A Bit on Ethics: A common thought process for ethical considerations is to recognize that everybody’s actions add up and everyone has the right to behave the way any other person does. That develops the understanding that examples set by leading, higher valued, people are what other people can be expected to try to develop to match, and be excused for trying to do that.

    The examples set by “all of the Winners” is the key. Allowing any Winner to Win by setting a more harmful, less helpful, example will produce increasingly unethical results. It would be great if the competitive advantages of getting away with benefiting from injustice or being more harmful failed to win. But that is likely a fantasy. Injustice and harmful behaviour likely need to be externally refereed or governed out of the game. A system that does not do that is ethically compromised would need to be changed in order to achieve ethical reductions of harm being done and ethical corrections for harm done.

    Footnote 2: A Bit on Politics: Understandings like the 2020 Human Development Report, the IPCC Reports and recommendations, and the Sustainable Development Goals are not political. And I have tried to also be apolitical in my presentation.

    What is being presented is apolitical evidence-based understanding, not political ideology. But there are developed social and economic ideologies that oppose learning it. And the proponents of those social and economic ideologies can be harmfully resistant to the learning and resulting understandably required changes, especially being resistant to changes of the system that would reduce developed perceptions of superiority. They will even argue against the undeniable understanding that GDP does not properly measure what is important (refer to the 2020 Human Development Report for a presentation of that improving understanding).

    The opponents to learning about the required system changes use political misleading marketing to delay the learning and corrections. They often resort to accusations that “The Left” (or some other term that is hoped to trigger a emotional response rather than a rational consideration) are trying to turn things into “taking money away from rich people” even though there is plenty of evidence to support a common sense understanding that many wealthy powerful people got their wealth and power by pursuing competitive advantages available to those who are willing to try to benefit at the expense of Others or by harming the environment.

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