Op­pos­ing view: Putting a price on car­bon is coun­ter­pro­duc­tive

USA TODAY International Edition - - NEWS - Jef­frey Ball Jeffrey Ball is scholar-in-res­i­dence at Stan­ford Uni­ver­sity’s Steyer-Tay­lor Cen­ter for En­ergy Pol­icy and Fi­nance.

It seems a sen­si­ble so­lu­tion: To slash emis­sions of the green­house gases dan­ger­ously warm­ing the planet, force pol­luters to pay for what they cough out. Slap­ping a price on car­bon, the ar­gu­ment goes, should prod com­pa­nies and con­sumers to go green, from elec­tric cars to re­new­able en­ergy to di­ets lower in meat.

But mount­ing ev­i­dence sug­gests that car­bon prices are like uni­corns and fairy dust: daz­zling in con­cept and all but mean­ing­less in prac­tice.

More states, re­gions and coun­tries than ever are putting prices on car­bon emis­sions. Europe has done it, cer­tain U.S. states have done it, Canada is do­ing it, and China, the world’s big­gest emit­ter, is mov­ing to do it. Yet global emis­sions are surg­ing to new highs.

One-fifth of all global emis­sions, the World Bank says, are now sub­ject to a car­bon price — ei­ther a tax or a mar­ket in manda­tory pol­lu­tion per­mits known as cap-and-trade. Nev­er­the­less, en­ergy-re­lated car­bon emis­sions jumped 1.6 per­cent in 2017, ac­cord­ing to the In­ter­na­tional En­ergy Agency, and they likely rose more in 2018.

Why aren’t car­bon prices curb­ing global warm­ing? They tend to con­strain emis­sions only in cer­tain parts of the econ­omy. And even there, politi­cians tend to lack the guts to set the prices high enough to change much. Lit­tle won­der that, ac­cord­ing to World Bank figures, less than 1 per­cent of global emis­sions are sub­ject to a car­bon price that econ­o­mists be­lieve is high enough to change much.

So car­bon prices aren’t just in­effec­tive; they’re coun­ter­pro­duc­tive. By pro­vid­ing the il­lu­sion that they’re effec­tively deal­ing with cli­mate change, they re­duce pres­sure for tougher poli­cies that could mean­ing­fully curb emis­sions, such as phas­ing out coal as an elec­tric­ity fuel ex­cept where it’s paired with car­bon-cap­ture tech­nol­ogy; main­tain­ing ex­ist­ing nu­clear plants; and mak­ing re­new­able en­ergy cheaper.

Cli­mate change, an ex­is­ten­tial chal­lenge, de­serves a mas­sive re­sponse. In the fu­ture, per­haps car­bon pric­ing will work. So far, it looks like a di­ver­sion.

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