Capture technology becomes automatically profitable if the cost to capture is less than the tax. If my business pays $100/t to emit carbon vs $90/t to capture it, I’ll emit and capture and make a $10/t profit.
At $100/t, capture technology would become widespread very very quickly as an arbitrage against the carbon tax. And yes, some emitters might find a more profitable way via reduction in emissions, but since capture is equivalent to reduction, the most profitable option will win out every time.
At $100/t, capture technology would become widespread very very quickly as an arbitrage against the carbon tax. And yes, some emitters might find a more profitable way via reduction in emissions, but since capture is equivalent to reduction, the most profitable option will win out every time.
This is the magic of carbon taxes.