Earth Equity News

Think-Tank Gives Thumbs-Up to ‘Dividending’ Carbon Revenues. By Charles Komanoff, Carbon Tax Center, September 15, 2008. “Resources for the Future's impressive new report, The Incidence of U.S. Climate Policy [PDF, 71pp], released late last week concludes that distributing carbon permit or tax revenues equally among U.S. residents would be income-progressive, whereas using the revenues to reduce payroll or income taxes would widen the already yawning income gap between rich and poor. These findings appear just as serious attention is beginning to be paid in carbon-pricing circles to the disposition of the enormous revenues that would be raised under either a hefty carbon tax or a stringent carbon cap-and-trade system. [Yesterday,] Sept. 16, the Energy and Environmental Study Institute and Clean Air - Cool Planet [co-hosted] a Capitol Hill briefing on Climate Change Legislation and Revenue Recycling, while [tomorrow,] Thursday Sept. 18, the House Ways & Means Committee is convening a Hearing on Policy Options to Prevent Climate Change focusing on revenue treatment... Intriguingly, RFF holds out high hopes for investing carbon revenues in energy-efficiency programs. According to the report, investing in ‘EE’ would yield around the same ‘progressive’ outcome... as cap-and-dividend, but with larger emissions reductions. Though the authors note that ‘There are important institutional challenges to achieving gains from end-use efficiency investments,’ they add that ‘our modeling suggests that if these challenges can be overcome such a policy might have important distributional benefits.’ The RFF geographical analysis is also encouraging, generally finding lesser interregional differences than are often supposed -- largely because regions with high carbon consumption in one sector, such as driving, tend to have offsetting lower carbon usage in other sectors like home heating.”