I know that some people claim we could but it is often because they do not look at every angle, especially economics, and scalability. Global scale endeavors tend to be complex and require long timelines.
There is a known straight-forward way to solve the economic problem. You impose a large carbon tax per ton of CO2 and use 100% of the money to subsidize power generation from non-fossil energy sources per KWh. Schedule regular increases in the rate over time, announced years in advance.
There are only two real impediments to this happening.
The first is lobbying from oil and coal companies (especially in the United States). The only solution for it is to have the will to tell them off and do it anyway.
The second is that nobody wants to do it alone. Having a carbon tax is a relative disadvantage -- if everybody does it then everybody is in the same boat, but if only you do it then everyone else is going to out-compete you, so you need some coordination method.
In particular, what keeps happening is that Europe and China are willing to reduce emissions but not if the United States won't and the United States has a large oil industry that it doesn't want to see destroyed even though that's what needs to happen. The answer is for the other countries to be serious about it and not take no for an answer -- literally stop trading with countries that won't do it. Give the US the choice between the oil industry and literally every other industry and the choice is easy.
That doesn't work for everyone. It isn't going to get a random African dictatorship to reduce its emissions. But none of the countries it wouldn't work on are major carbon emitters to begin with.
The problem is that nobody is willing to put their foot down.
This is incorrect - the fact is that we cannot afford it at all
A carbon tax of that nature will kill global growth, and our ability to service debt.
A carbon tax will mean many businesses will shut down or have their margins pruned significantly - costs which will be pushed to consumers.
This means lower global growth rates, which is not something politicians can sell, especially since the source of funds (corporations) will fund politicians who oppose it.
So it’s not just that nobody is willing to put their foot down, it’s that no one can afford to, without suffering huge repercussions.
> A carbon tax of that nature will kill global growth, and our ability to service debt.
Any discussion of growth and cost has to be industry-specific. Obviously a carbon tax is bad for the oil industry and good for the solar industry -- that's the whole point. But you're assuming it would be bad for everyone else, which isn't actually true.
Consider what happens when you have a cross-subsidy like that. The oil and coal companies have a bunch of known reserves and existing infrastructure -- already explored, already built. When the new policy arrives, suddenly the cost of solar or wind goes from e.g. $.06/KWh to $.04/KWh, meanwhile the total cost of oil or coal-fired power generation goes from $.04/KWh to $.06/KWh -- at the previous market commodity prices. But nobody is going to pay $.06/KWh for oil or coal when they can get solar or wind for $.04/KWh, so if the fossil fuel industry wants to make any use of their existing reserves and existing infrastructure, they have to eat the entire difference out of their profits -- they have to charge $.04/KWh after-tax in order to continue to compete in the market.
So the first question is, should we feel sorry for them? No. If you built a coal-fired power plant in 1945 then you've more than recovered your investment already. If you built or acquired one in 2010, decades after we've known this was a problem, you get what you deserve.
So the initial effect is a transfer of profits from the fossil fuel industry to the non-fossil fuel energy industry, but no actual change in the price of electricity -- after all, it's revenue neutral. The government isn't keeping any of the money.
What happens next is that oil exploration ceases to exist. There is no point in searching for more oil if the pre-tax market price is $10/barrel; it's not profitable. They'll sell the reserves they have for whatever they can get because what else are they going to do with them, but then they're done -- that's the whole idea. Meanwhile there is a huge boom in renewables because all the profits are there now -- all the profits the oil producers would have had are going to install solar panels instead.
So what does that make energy costs look like in ten or twenty years? Well, the two effects mostly cancel out. The existing oil and coal reserves get used up and not replaced, but in the meantime we're building non-fossil alternatives to replace them, using the money we're not paying to the oil producers. It's likely that the price would be slightly higher, because otherwise it's what the market would have done without the tax (though that is actually already happening somewhat because the prices are already pretty close), but the net result isn't a huge price differential because they're countervailing forces.
The major effect is what happens to the people who own the existing oil reserves. But notice that these are predominantly countries we don't really love, like Russia and Saudi Arabia. So the main effect is to transfer wealth from those countries to the local economy where you create jobs installing renewable energy infrastructure, which is an effect that significantly outweighs -- is net economically positive -- against a slight increase in generating costs, for any country that is not a large net oil exporter.
And that's assuming an increase in demand for renewables doesn't bring any economies of scale that could bring the price down below the existing energy market price.
Renewables will help significantly in reducing the power plant power issue. Sure. But we haven’t solved the storage problem, which means that at night we need gas/coal. When there’s no wind we need gas/coal.
Any tax will be passed on to consumers, if not in full then in part. This will of course drive people to use it less, which is good. Except that if people stop consuming, we have a problem....
Human demand for consumables is just starting to ramp up. Total power produced, total plastics produced, total chemicals used, total waste generated are just small portions of what they will end up - based on growth projections for countries like India and China.
7% growth means a doubling of materials use in a decade, over a population much larger than the first world.
That means the number of plane tickets, international trips, shipping containers, iPhones, batteries and inflatable mattresses - will go up. The carbon cost for most of these items is never calculated, and it’s convenient to push production to places where the laws can be ignored.
Further - Most of that growth investment has been done on the backs of debt.
when we tell people that they will become more expensive, people will be unhappy, and they will buy less.
Therefore Business owners are unhappy, lenders are unhappy which means politicians are unhappy.
Our current consumption patterns are not sustainable, but stopping them is political and economic suicide.
The circular loop at play here ensures that nothing will happen, because the costs are too high.
But that doesn't (inherently) emit CO2 so it isn't subject to a carbon tax. It should actually make plastics cheaper because they won't have to compete with power plants for oil.
> Renewables will help significantly in reducing the power plant power issue. Sure. But we haven’t solved the storage problem, which means that at night we need gas/coal. When there’s no wind we need gas/coal.
Markets are good at fixing things like this. Nuclear works great at night. Solar works during most of the peak load times (solar generation correlates with air conditioning usage). There is a problematic demand period between when the sun goes down and when people go to sleep, so use pricing to encourage people to do their laundry on Saturday morning instead of Friday night -- this may even save money on net.
And there is nothing saying you can't burn any carbon. If it's 9PM on a windless night then you pay the carbon tax for an hour. You're still down 95% from when that plant was operating 24/7.
> Any tax will be passed on to consumers, if not in full then in part.
It's revenue neutral. You're basically taking money from oil companies and giving it to renewables companies. That doesn't inherently change the market price at all. It's like taking money from Nike and giving it to Reebok. You get a change in the type of shoes but not necessarily the price of shoes. The only price difference is if it costs more to generate with renewables than fossil fuels -- but if that's even true at all anymore, the difference is very small.
And again, there is a plausible argument that scaling use of renewables will bring prices down. Once you have a given installed base of solar, it keeps generating power without having to spend additional resources on oil exploration/extraction/refining/distribution/etc.
I'm too old to believe "Markets will fix it" anymore, now I need to see the fine print, and then figure out how the economic game will look after the third play through.
Secondly, this doesn't obviate the need for additional power - you will still be burning coal/etc. You will use it less as a % of total power output. But if your power output increases (which it will, since most of humanity doesn't have power today), you are still looking at a potential increase.
I assume we are not including cars/busses because we expect electric cars to fix that.
However, flight and shipping will remain oil based.
------
I love your points and the enthusiasm with which you make them, I think you need to consider your model with bad actors playing it, and you need to consider the self referential aspects of this model.
For example
1) More cheap power means more use of that power. Imagine millions more tamagotchis, or fans which can be kept running nonstop, or other items which are now affordable because power is cheaper.
Case in point - bitcoin miners are today limited by the cost of power. Every efficiency gain in power production, results in more bitcoin miners being added to the system. Every increase in power, results in people dropping out of the system.
2) The economic game is played over several rounds. In the best case scenario, the 3 players (consumers, regulators, producers) are in even tension.
But if producers get rich enough (or even earlier), they can regularly suppress regulators and get away with not paying taxes, polluting without worry and so on.
They can also just straight up reject options like carbon taxes, saying that it will not work for them.
----------
To make my point clear to you -
The set up of the game is such that no player is in a position to put their foot down! Any player that makes that call is removed from the game
Observe the set up of the game
1) Financers
2) consumers
3) Producers
4) Regulators
5) Politicians
Contracts and obligations guarantee that the interests of financers will be met by producers - in short, the necessity of global growth is backed up by contracts and loans.
The producers of industries, regulators, and politicians regularly ignore many of the primary concequences of polluting industries (the tradgedy of the commons, and this is worse in developing nations which dont have the resources to afford or keep regulators safe)
Any politician which ends up proposing a tax increase, will need massive consumer support - but this is eventually self harming.
Those consumers need jobs, an effective carbon tax would severely harm growth prospects, and thus job creation in an economy.
This means that people will eventually vote this govt out, because they want growth.
FInancers and producers will collude to fund people who support their goals.
Your "foot down" cant happen, because the game is not set up to allow that behavior.
> I'm too old to believe "Markets will fix it" anymore, now I need to see the fine print, and then figure out how the economic game will look after the third play through.
You're using "I don't believe in markets" as a justification for not regulating something.
> Secondly, this doesn't obviate the need for additional power - you will still be burning coal/etc. You will use it less as a % of total power output. But if your power output increases (which it will, since most of humanity doesn't have power today), you are still looking at a potential increase.
The potential increase is independent of the percentage decrease. If total consumption doubles while the share of fossil fuels drops from 50% to 5%, total fossil fuel use has gone down. Even if total consumption increases by more, you still have proportionally less fossil fuel usage than you would have with the same increase in consumption and no decrease in the ratio of fossil fuels.
> More cheap power means more use of that power. Imagine millions more tamagotchis, or fans which can be kept running nonstop, or other items which are now affordable because power is cheaper.
You only burn oil when there is more demand than supply, which are exactly the times that price-sensitive users will discontinue their usage.
> However, flight and shipping will remain oil based.
It's possible to use biofuels for this. Also, you can make ships run on anything. Wood, garbage, batteries, wind, plutonium. If it can generate torque, thrust or steam it can power a ship.
> Those consumers need jobs, an effective carbon tax would severely harm growth prospects, and thus job creation in an economy.
You keep saying that it would reduce growth. How is taking billions of dollars that would have gone to unfriendly countries and instead using it to hire a million domestic workers to build renewable energy infrastructure, all while energy prices remain the same or go down, supposed to reduce growth?
>You're using "I don't believe in markets" as a justification for not regulating something
If that’s the case I’m doing it wrong, since I believe the opposite. Good regulations with the ability to verify easily make markets work.
>The potential increase is independent of the percentage decrease.
Agree, it’s matter of what the mix is. Higher power gen, with a smaller coal/oil mix in big relative and absolute terms is also. Possibility. I don’t believe it is, but it remains a possible outcome.
>You only burn oil when there is more demand than supply, which are exactly the times that price-sensitive users will discontinue their usage.
I am wary that this will cleave so cleanly.
>It's possible to use biofuels for this. Also, you can make ships run on anything. Wood, garbage, batteries, wind, plutonium. If it can generate torque, thrust or steam it can power a ship.
But those aren’t there yet and oil is still the best and economic option
So change will not come here, without a break through technology.
>You keep saying that it would reduce growth.
Well yes - you are focused only on power. But I’m looking around me and an actual, effective working carbon tax aimed at saving the environment would hit every industry, not just power.
For example most of the products made in my country don’t necessarily come from places that follow regulations.
Working regulations would necessarily make those products more expensive and that would mean many jobs lost, marginal business shut, and and overall increase in costs of goods.
The cost of compliance with just air regulations norms for engines increased the price significantly. This resulted in many hacks or workarounds which harm the engine but superficially match the new norms.
Another example - we recently saw a major city try and ban plastic (yet again), but it would result in many street vendors and stores being unable to package liquid goods.
India is famously cost sensitive, and price advantages often completely override quality advantages. People developed single use washing powder sachets, and created an entirely new market.
But if the cost of carbon cleanup was added to those sachets, they would not be viable products at all.
All of those represent the razor thin margins needed to ensure the economy in india Grows.
There’s no way in our economy, to keep growth and the environment safe.
So while we are moving to alternate sources of power, it’s not stopping the other sources of pollution.
China’s well more than 4x the population of the US.
Those stats, from 2012, are quite outdated, too; while still the largest users of coal (but again, largest country) they’re rapidly and aggressively investing in green energy and cutting back on coal use. The Chinese produce much less carbon per capita than Americans do [1] and recently hit their carbon reduction targets well ahead of schedule [2].
Great for China! The point is that the OP used the all-too-common, purposefully-vague "lobbyist" argument into his rant, as if a profession (rather than the oil and gas companies for whom they work) is responsible for all the global warming problems in the world.
Further, the OP obscures the simple fact that even with large shifts in power production over the next few decades, China is, and will remain, the largest coal consumer in the world by far. And yet his suggestion is to cut off the USA, not China, from all global trading.
The oil and gas companies employ lobbyists as a means to effect policy changes (or inaction), so...well, despite your snippy attempt to clarify I'm still not sure exactly what your point here is? Yes, the oil and gas companies are the bad guys, I doubt anyone (myself or OP included) would disagree; the problem is that the tens of millions of dollars each year they spend lobbying is apparently a very effective weapon (that they probably shouldn't have) to prevent collective climate action.
And yes, the proper global action is to punish climate hogs like the US. And to be clear, once again, relatively speaking China's not a climate hog: it's inane to demand a country of 1.5 billion reduce its total coal usage to less than that of a country less than a quarter of the size before demanding the smaller country to do anything at all, and even more inane to try to punish countries who are aggressively working towards a solution (Europe, China), instead of those actively fighting against one (the US).
From some kind of top-down perspective, where you have total control over all aspects of policy in all countries, then yes, I suppose the focus should be on China. But that's not the way the global economy works; it's a game where no one country will be gladly willing to sacrifice its competitive advantage, and that's why per capita figures matter more than raw numbers.
In the first, the U.S. and China are the only countries reducing coal use in the final years of the chart. In the second, from 2015, it clearly states the U.S. reduced coal consumption by 11%. Double the reduction from Japan or Canada, 3x that of Germany.
And finally, I'm sorry it needs to be specifically pointed out -- but politicians vote on policies. Not lobbyists, not energy companies.
What does India have to do with anything? Yes, India uses even less carbon per capita than the US or China! Good for India! It'd be awesome if both China and the US could bring their carbon production per capita down to India's level, or even lower.
As for the situation in the US: the latter of your sources is conveniently from 2015, before the US elected a president who campaigned on reviving the coal industry, appointed the CEO of Exxon-Mobil to Secretary of State, pulled out of the Paris Climate Accord, and has made it his daily mission to roll back EPA protections. Does this [1] sound like a government that's "aggressively reducing coal usage"? If coal usage is going down in the US, it's despite, not because of, any efforts by the current federal government. And indeed, coal specifically aside, carbon emissions in 2018 are projected to rise in the US after a steady decline since 2005 [2].
> And finally, I'm sorry it needs to be specifically pointed out -- but politicians vote on policies. Not lobbyists, not energy companies.
I mean, it doesn't need to be pointed out; we're all, despite differences of opinions, reasonably intelligent people here, and we all know about and have made up our minds on lobbying. Of course politicians write laws and vote on policies; I happen to think that if oil and gas companies are spending things like $65 million a year [3] to try to influence those politicians and the policies they make, they must have determined that has some effect. I suppose you don't, or think it doesn't matter because the buck stops with the politicians or something. I think that's naïve. But I promise we're all familiar with the ground facts, and your condescending attitude isn't really encouraging any useful discussion.
Come on dude, fine that we disagree but don't keep deflecting. You've twice given China a pass due solely to its population. India is proof that you can have well over a billion people without 4x the coal consumption of the USA. The exact thing you called "inane."
I’ve given China a pass relative to America. Bringing in some other country doing better than China to argue that America should then be given a pass relative to China is the exact thing you called “deflecting”.
One thing that I do know is that wind and solar have more installations and lower cost than every projection. So they're projected to not be enough... eh?
Indeed. It's awesome that they are beating projections, but even so, the rate is far below what is needed to decarbonize the energy sector by mid-century which is what we need to keep warming below 2C.
It is? That's because we aren't spending very much on wind+solar, because the projections said that the wind+solar industry couldn't grow fast enough. It's all circular reasoning.
