Fee and Dividend | Carbon Fee and Dividend | Cap and Trade | CO2 Emissions | Carbon Emissions

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More about the Fee and Dividend

The “Carbon Fee and Dividend” presented by Dr. James Hansen has the best potential to initiate cause and effect that will lower Co2 emissions. Fee and dividend is the policy complement that must accompany recognition of fossil carbon reservoir sizes for strategic solution of global warming (the physics: reservoir sizes imply the need to phase-out coal emissions promptly and quash unconventional fossil fuels).

The Carbon 'Fee & Dividend' presented by Dr. James Hansen has the best potential to initiate cause and effect that will lower Carbon Dioxide Emissions. Fee and dividend is, by all reasoned accounts, the most simple method possible to reduce Carbon Dioxide Emissions, move us toward renewable sustainable energy and maintaining a functioning economy.

Carbon Fee and Dividend by Dr. James Hansen

1. Fee Large & Growing (but get it in place!)

tap efficiency potential & life style choices

2. Entire Fee Returned

equal monthly deposits in bank accounts

3. Limited Government Role

keep hands off money!
eliminate fossil subsidies
support technology development (no Manhattan projects!)
change profit rules and motivation for utilities
watch U.S. modernize & emissions fall!

A “carbon fee with 100 percent dividend” is required for reversing the growth of atmospheric Carbon Dioxide. The fee, applied to oil, gas and coal at the mine or port of entry, is the fairest and most effective way to reduce emissions and transition to the post fossil fuel era. It would assure that unconventional fossil fuels, such as tar shale and tar sands, stay in the ground, unless an economic method of capturing the Carbon Dioxide is developed.

The entire fee should be returned to the public, equal shares on a per capita basis (half shares for children up to a maximum of two child-shares per family), deposited monthly in bank accounts. No bureaucracy is needed.

A Fee and Dividend program returns 100% of the fee to the public/consumers for installing Renewable Energy Technologies!

The public can understand this and will accept a fee if it is clearly explained and if 100 percent of the money is returned to the public. Not one dime should go to Washington for politicians to pick winners. No lobbyists need be employed.

The public will take steps to reduce their emissions because they will continually be reminded of the matter by the monthly dividend and by rising fossil fuel costs. It must be clearly explained to the public that the fee rate will continue to increase in the future.

When fuel prices decline, the fee should increase, to retain the incentive for transitioning to the post-fossil-fuel-era. The effect of reduced fossil fuel demand will be lower fossil fuel prices, making the fee a larger and larger portion of energy costs (for fossil fuels only). Thus the country will stop hemorrhaging its wealth to oil-producing states.

Fee and Dividend is progressive.

A person with several large cars and a large house will have a fee greatly exceeding the dividend. A family reducing its carbon footprint to less than average will make money. Everyone will have an incentive to reduce their carbon footprint. The dividend will stimulate the economy, spur innovation, and provide money that allows people to purchase low carbon products.

A carbon fee is honest, clear and effective.

It will increase energy prices, but low and middle income people, especially, will find ways to reduce carbon emissions so as to come out ahead. The rate of infrastructure replacement, thus economic activity, can be modulated by how fast the carbon fee rate increases. Effects will permeate society. Food requiring lots of carbon emissions to produce and transport will become more expensive and vice versa, encouraging support of nearby farms as opposed to imports from half way around the world.

Beware of alternative approaches, such as ‘percent emission reduction goals’ and ‘cap and trade’.

These are subterfuges designed to allow business-as-usual to continue, under a pretense of action, a greenwashing. Hordes of lobbyists will argue for these approaches, which assure their continued employment. The ineffectiveness of ‘goals’ and ‘caps’ is made blatantly obvious by the fact that the countries promoting them are planning to build more coal-fired power plants.

If the United States accedes to the ineffectual ‘goals’ and ‘caps’ approach, in effect continuation of the Kyoto Protocol approach, it will practically guarantee disastrous climate change. Instead it should persuasively argue that other countries also adopt fee and dividend.

The countries agreeing to this approach will also agree that imports from a country that does not apply a comparable carbon fee will have a fee applied at the port of entry. That fee, which should be added to the public’s dividend, will be a strong incentive for all countries to participate.

A carbon fee is necessary but not sufficient.

By itself a carbon fee cannot solve the energy problem and allow rapid coal phase-out. There also must be better efficiency standards in building codes, for vehicles, and in appliances and electronics. Profit incentives for utilities must be changed, so as to encourage efficiency as opposed to selling as much 6 energy as possible. These are only examples of the many things to be done. But all of these things will be done easier and more effectively in the presence of a carbon fee.

Indeed, a carbon fee is essential.

It is the tool that will impact people’s decisions and lifestyle choices for the short-term, middle-term and long-term, allowing the world to move as gracefully as possible to the post-fossil-fuel-era. In this way we will leave in the ground the hardest to extract fossil fuels as we move rapidly to clean energy sources of the future.

No Alligator Shoes!

The charts for my talk (Climate Threat to the Planet: Implications for Energy Policy) on 3 June 2008 at the PACON 2008 conference (Energy and Climate Change: Innovative Approaches to Solving Today’s Problems) are available as a pdf or powerpoint

Fee and 100% dividend can drive innovation and economic growth with a snowballing effect. Carbon emissions will plummet far faster than in top-down or Manhattan projects. A clean environment that supports all life on the planet can be restored.

“Carbon fee and 100% dividend” is spurred by the recent “carbon cap” discussion of Peter Barnes and others. Principles must be crystal clear and adhered to rigorously. A fee on coal, oil and gas is simple. It can be collected at the first point of sale within the country or at the last (e.g., at the gas pump), but it can be collected easily and reliably. You cannot hide coal in your purse; it travels in railroad cars that are easy to spot. “Cap”, in addition, is a euphemism that may do as much harm as good. The public is not stupid.

The entire carbon fee should be returned to the public, with a monthly deposit to their bank accounts, an equal share to each person (if no bank account provided, an annual check – social security number must be provided). No bureaucracy is needed to figure this out. If the initial carbon fee averages $1200 per person per year, $100 is deposited in each account each month (Detail: perhaps limit to four shares per family, with child shares being half-size, i.e., no marriage penalty but do not encourage population growth).

A carbon fee will raise energy prices, but lower and middle income people, especially, will find ways to reduce carbon emissions so as to come out ahead. Product demand will spur economic activity and innovation. The rate of infrastructure replacement, thus economic activity, can be modulated by how fast the carbon fee rate increases. Effects will permeate society. Food requiring lots of carbon emissions to produce and transport will become more expensive and vice versa – it is likely, e.g., that the UK will stop importing and exporting 15,000 tons of waffles each year. There will be a growing price incentive for life style changes needed for sustainable living.

The present political approach is to set carbon emissions reductions goals for 2025 or 2050. The politicians do not expect the goals to be reached, and they define escape hatches that guarantee they will not. They expect to be retired or become lobbyists before the day of reckoning. The goals are mainly for bragging rights: “mine is bigger than yours!”

The worst thing about the present inadequate political approach is that it will generate public backlash. Taxes will increase, with no apparent benefit. The reaction would likely delay effective emission reductions, so as to practically guarantee that climate would pass tipping points with devastating consequences for nature and humanity.

Carbon tax and 100% dividend, on the contrary, will be a breath of fresh air, a boon and boom for the economy. The fee is progressive, the poorest benefiting most, with profligate energy users forced to pay for their excesses. Incidentally, it will yield strong incentive for aliens to become legal; otherwise they receive no dividend while paying the same carbon fee rate as everyone.

Special interests and their lobbyists in alligator shoes will fight carbon fee and 100% dividend tooth and nail. They want to determine who gets your fee money in the usual Washington way, Congress allocating money program-by-program, substituting their judgment for that of the market place. The lobbyists can afford the shoes. Helping Washington figure out how to spend your money is a very lucrative business

But we can save the planet and alligators by making sure that not one thin dime of the carbon fee is siphoned off by lobbyists for their clients – 100% must be returned to citizens as dividend. Make this your motto: “100% or fight! No alligator shoes!”

Check the position of your congresspersons. If they spout things like “global warming is the greatest hoax in the history of the universe," check the shoes of the people who visit them or have dinner with them. Changes in Congress are needed if we want our children and grandchildren to win this one.

Because of great benefits to the nation, humanity and nature, this approach soon would be adopted by other nations, providing an obvious path toward international agreements.

Jim Hansen

If you live in an area where there has been, or could be impacted with power blackouts, brownouts, rolling blackouts or intermittent power, you need a backup power supply!

If you live or work in an area that has had, or could have; earthquakes, hurricanes, tornados, forest fires, thunderstorms, snow/ice storms or floods, you probably need a backup power supply!

The electric grid provides power at a reliability factor of about 99.97% - however, if your your home, business, hospital, food/agricultural, restaurant, or other type of facility is "power critical" or power sensitive , you need a reliable backup power supply!

A backup power supply is comprised of a generator with an automatic transfer switch.

Buying a generator for standby power can be the first step to regaining control over protecting your family and possessions from harm. And, using a generator is as simple as operating any household appliance. After you have selected a generator, here are a few tips that can help you keep power through the storm.

We can help you select the right backup power supply for your business or facility. Call/email us for more information.

"Cap and Trade" was originally implemented as a result of the 1990 Clean Air Act, where Cap and Trade was first implemented - and to a very huge success in reducing Sulfur Dioxide Emissions - the cause of "acid rain."

In the proposed Cap and Trade program as it applies to capping the amount of Greenhouse Gas Emissions - the cap limits the amounts of global warming emissions - Greenhouse Gas Emissions - and more specifically, the amount of Carbon Dioxide Emissions - and gradually decreases the amounts of Greenhouse Gas Emissions and Carbon Dioxide Emissions that a country - or region, may produce.

Therefore, a “cap” is the legal limit on the quantity of Greenhouse Gas Emissions that a country or region may emit each year and the “trade” means that companies may trade among themselves the permission – (permits) – to emit Greenhouse Gas Emissions.

A successful Cap and Trade market for capping Greenhouse Gas Emissions will enable those who can reduce pollution cheaply and inexpensively - to earn a return on their Greenhouse Gas Emissions reductions by the investment they made to reduce these emissions.... by selling extra allowances or permits in the marketplace. The Cap and Trade program, simultaneously, allows those companies who can’t reduce their Greenhouse Gas Emissions as inexpensively, to purchase those allowances or permits at a lower cost than the cost of investing in the equipment or technologies that would have reduced their own Greenhouse Gas Emissions.

According to the U.S. EPA, Cap and Trade is an environmental policy tool that delivers results with a mandatory cap on emissions while providing emission sources flexibility in how they comply. Successful Cap and Trade programs provide strict environmental accountability without inhibiting economic growth, and reward innovation, efficiency, and early action.

Cap and Trade is a policy approach for controlling large amounts of emissions from a group of sources. The approach first sets an overall cap, or maximum amount of emissions per compliance period, for all sources under the program. The cap is chosen in order to achieve a desired environmental effect. Authorizations to emit in the form of emission allowances are then allocated to affected sources, and the total number of allowances cannot exceed the cap. Individual control requirements are not specified for sources; instead, sources report all emissions and then surrender the equivalent number of allowances at the end of the compliance period.

Allowance trading enables sources to design their own compliance strategy based on their individual circumstances while still achieving the overall emissions reductions required by the cap. Affected units can tailor their compliance plans to each source. Compliance strategies in well-designed cap and trade programs require no prior approval, allowing sources to respond quickly to market conditions and government regulators to remain focused on results. Sources must also accurately measure and report all emissions in a timely manner to guarantee that the overall cap is achieved.

When Is Cap and Trade Effective?

In EPA’s experience, Cap and Trade programs have proven highly successful in the context for which they are best suited: reducing emissions on a regional or larger scale from multiple sources that exhibit a range of control costs. While achieving significant reductions on a regional scale, cap and trade programs can deliver substantial air quality improvements. As effective as these programs are, however, they may not be the solution to every problem. For example, eliminating localized concentrations of pollution is not their primary purpose.

The Cap and Trade approach is best used when the environmental and/or public health concern occurs over a relatively large area; a significant number of sources are responsible for the problem; the cost of controls varies from source to source; and emissions can be consistently and accurately measured. Under the right circumstances, cap and trade programs have proven extremely effective, providing substantial emission reductions, complete accountability and unprecedented data quality and access. Existing Cap and Trade programs – the Acid Rain Program and the NOx Budget Program – have the force of federal and state standards behind them, including national health-based air quality standards. This ensures that local public health needs are met in conjunction with achievement of regional or national emission reductions.

Cap and Trade Program Design

Three features critical to designing and implementing environmentally effective and economically efficient trading programs are 1) the cap on emissions, 2) accountability, and 3) simplicity of design and operation.

The cap on emissions is the central component and element of an effective and efficient cap and trade program. A mandatory cap on emissions is critical to protect public health and the environment and to sustain that protection into the future. The cap also serves to provide stability and predictability to the allowance trading market.

The remarkable efficiency and reduced costs of a cap and trade program should not overshadow the purpose of the cap – which is to yield public health and environmental results.

As an example that was very successful of a Cap and Trade program, SO2 emissions have been reduced dramatically under the AcidRain Program. Early reductions under the first phase of the program were banked to provide a gradual transition into the more stringent second phase.

Source: www.epa.gov/airmarkets

Accountability

The accurate measurement and reporting of emissions is critical, along with the rigorous and consistent enforcement of penalties for fraud or noncompliance.

Also critical is transparency, such as public access to source-level emissions and allowance data.

The coupling of stringent monitoring and reporting requirements and the power of the Internet makes it possible for EPA to provide access to complete, unrestricted data on trading, emissions, and compliance. This promotes public confidence in the environmental integrity of the program and business confidence in the financial integrity of the allowance market. It also provides an additional level of scrutiny to verify enforcement and encourage compliance.

Accountability requires ongoing evaluation of the cap and trade program to ensure that it is making progress toward achievement of its environmental goal.

Rules should be clear and easily enforced. Markets function better and transaction costs are lower when rules are simple and easily understood by all participants. Moreover, the environment is more likely to be protected when rules are clear and consistently enforced. To the greatest extent possible, simplicity should be applied to all elements of the program, including applicability thresholds (determining which sources are affected), trading rules, reporting requirements and penalty assessments. Program operation for both emission sources and regulating authorities is more certain, more effective, and less costly and time-consuming if the rules are not overly complex and burdensome.

A well-designed Cap and Trade program delivers the following benefits:

• Greater environmental protection at lower cost

• Broad regional reductions, facilitating state efforts to address local impacts

• Partnership with existing requirements to ensure protection of the local population and environment.

Continued Accountability

As the Cap and Trade mechanism is applied to new environmental problems, the EPA understands the importance of ongoing assessment to ensure that environmental and public health goals are met.

The remarkable efficiency and reduced costs of a cap and trade program should not overshadow the purpose of the cap – that is, to yield public health and environmental results. Whether the cap has been set at a level adequate to achieve the desired public health and environmental protections is an issue that warrants study and evaluation.

As previously mentioned, both the Acid Rain Program and the NOx Budget Cap and Trade programs have been highly effective in reducing these specific emissions.

Though long-term environmental monitoring has affirmed the programs’ effectiveness, studies have shown that further reductions in emissions beyond the current caps are necessary to protect public health and the environment.

Did you know that 10% of our nation's electricity now comes from "cogeneration" plants?

And because cogeneration is so efficient, it saves its customers up to 40% on their energy expenses, and provides even greater savings to our environment through significant reductions in fuel usage and much lower greenhouse gas emissions.

Cogeneration - also known as “combined heat and power” (CHP), cogen, district energy, total energy, and combined cycle, is the simultaneous production of heat (usually in the form of hot water and/or steam) and power, utilizing one primary fuel such as natural gas, or a renewable fuel, such as Biomethane, B100 Biodiesel, or Synthesis Gas.

Cogeneration technology is not the latest industry buzz-word being touted as the solution to our nation's energy woes. Cogeneration is a proven technology that has been around for over 120 years!

Our nation's first commercial power plant was a cogeneration plant that was designed and built by Thomas Edison in 1882 in New York. Our nation's first commercial power plant was called the "Pearl Street Station."

Decentralized Energy generates the power and energy that a residential, commercial, municipal or industrial customer needs, onsite, for their home or business.

Today's electric utility industry was "born" in the 1930's, when fossil fuel prices were cheap, and the cost of wheeling the electricity via transmission power lines, was also cheap. "Central" power plants could be located hundreds of miles from the load centers, or cities, where the electricity was needed. These extreme inefficiencies and cheap fossil fuel prices have added a considerable economic and environmental burden to the consumers and the planet.

Centralized energy is found in the form of electric utility companies that generate power from "central" power plants. Central power plants are highly inefficient, averaging only 33% net system efficiency. This means that the power coming to your home or business - including the line losses and transmission inefficiencies of moving the power - has lost 75% to as much as 80% energy it started with at the "central" power plant. These losses and inefficiencies translate into significantly increased energy expenses by the residential and commercial consumers.

According to the Department of Energy, Demand Side Management or "DSM," refers to those "actions taken on the customer's side of the meter to change the amount or timing of energy consumption.

Utility DSM programs offer a variety of measures that can reduce energy consumption and consumer energy expenses. Electricity DSM strategies have the goal of maximizing end-use efficiency to avoid or postpone the construction of new generating plants." Therefore, Demand Side Management, is the process of managing the consumption of energy, generally to optimize available and planned generation resources.

While not every business is a candidate for onsite power generation, such as an onsite cogeneration or trigeneration energy system, however, your company may be a great candidate for other energy-saving solutions. One of these is Demand Side Management or "DSM". We help commercial, industrial and utility clients by providing cost-effective Demand Side Management solutions.

Distributed Energy Resources (DER) are small, modular, energy generation and energy storage systems and technologies that provide electric capacity or thermal energy (i.e. hot water, chilled water, steam) where and when a commercial or industrial client requires.

Distributed Energy Resources are highly flexible and adaptable, and can therefore, be sized to meet any customer's specific power and energy requirements, at the customers facility or business.

As they are flexible and adaptable for nearly any customer's specific requirements, DER systems can be installed to operate with the local electric grid, or be designed and installed "grid-free" without connecting to the electric grid in island or stand-alone mode.