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LSE report concludes UK carbon tax would do nothing to reduce European-wide greenhouse gas emissions

The introduction of a carbon tax would help the UK meet its greenhouse gas target, but make no difference to emissions of greenhouse gases across Europe, according to research by the Grantham Research Institute on Climate Change and the Environment and the Centre for Climate Change Economics and Policy, at the London School of Economics and Political Science (LSE).

The report—“Combining Multiple Climate Policy Instruments: How not to do it”, points out that a Europe-wide cap on emissions under the EU Emissions Trading Scheme means that the rest of Europe will continue to emit up to this capped level whatever policy instruments are introduced at a national level.

The UK Government is currently consulting on a carbon floor price or tax which would mean that UK electricity companies would have to pay extra for the carbon they emit. Until now power generators have been exempt from the Climate Change Levy, the closest thing that the UK has to a carbon tax.

A carbon tax would undoubtedly encourage UK companies to reduce their greenhouse gas emissions since they would have to pay two sets of costs for every tonne of greenhouse gas they emit – for the carbon tax and for EU ETS permits.

And while any cuts in emissions are welcome, we have to look beyond the UK. A lower demand for EU ETS permits from UK companies would cause the price of carbon to fall, encouraging other countries to emit more. As long as there is a European cap on emissions, anything we do unilaterally merely moves greenhouse gases around. The accounting may look good, but the reality isn't.

—Dr. Samuel Fankhauser, one of the research’s authors and Deputy Director of the Grantham Research Institute

One of the UK Government’s objectives in considering a carbon tax, or a carbon price floor, is to set a strong and predictable carbon price which would be an effective penalty for pollution and encourage investment in renewable energies and Carbon Capture and Storage.

A strong, long-term carbon price is a good thing, so the tax has its merits. But an even better approach would be for the UK to work with its EU partners to tighten the EU emissions cap from a 20 per cent to a 30 per cent target. This would send a long-term price signal and lead to immediate EU-wide emission reductions.

—Dr. Fankhauser

Comments

Scott

...but as usual the price will be passed from to the consumer who has little influence on how things such as power is generated. Setting targets rather than pricing would be more effective, but then the government wouldn't be paying off the deficit so quick, so I smell a green smokescreen.

Reel$$

The eco-media continues its culture of denial by clinging with increasing desperation to the failed concept of global warming. BUT THERE IS HOPE!!! A couple of old schoolers are asking the right question:

"Are We Focused on the Wrong Crisis?"

"Richard Heinberg, Rob Hopkins (founder of the Transition Towns movement) and others believe we should be much more worried about resource scarcity (oil, natural gas, coal, uranium, water, top soil) than climate change – that this will cause an end to the world as we know it long before catastrophic climate change does."

In fact Heinberg and Hopkins are on the right track. To continue the alternative energy and sustainable future movement the campaign need only make this rather small shift to resource scarcity. THIS is where nations can agree without the psuedo-science of AGW to corrupt it, a new campaign based on resource transition and conservation will succeed.

But first we have to admit to the failure of "climate." It takes strong constitution to admit defeat. Stronger still to turn that defeat into success. It can be done. By dumping the fear-mongering of "CO2 emissions" - and re-alignment to the reel fact of dwindling resources.

Do we have the resolve? Will the millions of climate grant recipients agree to belt tightening?? Will the three corners of expertise get behind the campaign that WILL speed sustainability?? Stay tuned folks...

http://blogs.alternet.org/refugee/2011/01/17/dont-panic-the-failure-at-cancun/

Scatter

Reel$$ if you're going to cite people, can I suggest that you actually read what they've written? If you had bothered you would have noticed that, unlike you, both Heinberg and Hopkins recognise the reality and seriousness of climate change.

The two issues of energy supplies and climate change are intimately interlinked, but the former will play out this decade while the latter will play out over centuries.

Reel$$

Scatter, hence the bold type on the subhead, "Are We Focused on the Wrong Crisis?" Obviously they are AGW believers, but they have moved on to a new "crisis" far better suited for the times.

Heinberg and Hopkins are willing to admit the climate "crisis" is not garnering the desired response. They are being pragmatic about moving on to a "crisis" that just might gain acceptance. That one is resources. And as I have noted many times - it is the only one that will move the human population toward sustainability.

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