Rather than simply measuring and taxing carbon output, in a market scheme, the government will not only have to measure and, for all intents and purposes, "tax" the output, but it will also be required to create a bureau that will auction off the credits and then verify that companies have in fact used the credits appropriately. This is a very government-heavy project.
It will likely function as poorly as the government-managed market has in the EU, where huge loopholes have essentially enabled large companies to use the credits as subsidies, with no measurable gains for the environment.
CARBON TAXES
On the other hand, "Denmark, which brought in a carbon tax in the 1990s, reduced its greenhouse gas emissions dramatically, and its economy grew faster than Canada’s."
This might come as a shock to those of us who seem inclined to believe that the tar sands have all but BECOME the Canadian economy, but we're way behind here - economically and environmentally - and we will continue to be for as long as we think that expensive oil will grease rather than grind down our economy. From a recent editorial in the Halifax Chronicle Herald:
"As long as we can run our cars on cheap gasoline and generate electricity with cheap coal, it is not economical to develop greener sources of energy.
When prices go up, the market seeks alternatives. According to a recent survey of the state of the world’s energy economy in the Economist, there is every reason to believe that the market will find alternatives.
Rich, smart innovators from the dot-com world are putting their brains and money into the energy market — billions in private research money. Google, for instance, is investing heavily in a project to develop green energy that will be cheaper to produce than dirty old coal.
Wind power, which used to be expensive, is already as cheap as electricity generated by natural gas, and it has the promise to be even more useful, if electricity grids are managed more intelligently. The price of solar power is coming down, although it is not yet practical on a large scale. Both geothermal and tidal power have great potential.
In Scandinavia, governments committed to reducing emissions in the 1990s. With wind power, energy-efficient buildings and community heating plants that run on waste wood or straw, communities there have radically reduced their energy consumption without ruining their standard of living.
In Canada, the government wasted money with popular but useless incentive programs and advertising campaigns, and our emissions steadily rose, driven by SUVs and the filthy oilsands."
In Japan, they're so far ahead that they're already installing solar panels ON WINDOWS to generate power (see pic below)!
We know we have to put a price on carbon. But if we want to put a price on carbon in the quickest, most effective way, we will select a carbon tax option.
