Putting a price on carbon, in the form of a fee or tax on the use of fossil fuels, coupled with returning the generated revenue to the public in one form or another, can be an effective way to curb emissions of greenhouse gases. That’s one of the conclusions of an extensive analysis of several versions of such proposals, carried out by researchers at MIT and the National Renewable Energy Laboratory (NREL).
Putting a price on carbon, in the form of a fee or tax on the use of fossil fuels, coupled with returning the generated revenue to the public in one form or another, can be an effective way to curb emissions of greenhouse gases. That’s one of the conclusions of an extensive analysis of several versions of such proposals, carried out by researchers at MIT and the National Renewable Energy Laboratory (NREL).
What’s more, depending on the exact mechanism chosen, such a tax can also be fair and not hurt low-income households, the researchers report.
The analysis was part of a multigroup effort to apply sophisticated modeling tools to assess the impacts of various proposed carbon-pricing schemes. Eleven research teams at different institutions carried out the research using a common set of starting assumptions and policies. While significant details differed, all the studies agreed that carbon taxes can be effective and, if properly designed, need not be regressive.
An overview report on the 11 studies appears today in the journal Climate Change Economics, along with reports on the individual team results. The MIT and NREL team included former MIT postdoc Justin Caron, MIT Joint Program on the Science and Policy of Global Change Co-Director John Reilly, and Stuart Cohen and Maxwell Brown of NREL.
Read more at Massachusetts Institute of Technology (MIT)
Image via MIT
