Texas company to close all of its Illinois coal-fired power plants, another sign the global transition to clean energy is accelerating

By Michael Hawthorne, Chicago Tribune, Sept. 30, 2020

In a move that promises cleaner air in Chicago and other cities as far away as New York and Boston, a Texas-based company announced Tuesday it will close its Illinois fleet of coal-fired power plants within a decade.

Vistra Energy absorbed nine of the state’s coal plants during a corporate merger just two years ago. Like its predecessors, the company found it increasingly difficult to profit from burning coal amid competition from cheaper, cleaner natural gas and renewable energy.

Scuttling the Illinois plants — and three others in Ohio — is part of Vistra’s plan to gradually shift its investments to solar installations and industrial-size batteries that store power for when the sun doesn’t shine or the wind doesn’t blow.

“Vistra’s commitment to our transformation to a low-to-no-carbon future is unequivocal and offers unique opportunities for growth and innovation,” Curt Morgan, the company’s president and CEO, said in a statement.

Only 15% of the electricity generated in Illinois last year came from Vistra coal plants. But the company’s fleet was responsible for nearly half the heat-trapping carbon dioxide and lung-damaging sulfur dioxide emitted by the state’s power plants during 2019, according to federal records.

Closing the Illinois and Ohio plants will reduce pollution that drifts into other states and contributes to dirty air problems throughout the Midwest and Northeast. It also will eliminate the same amount of climate-changing pollution as taking more than 10 million cars off the nation’s roads would.

Nonprofit groups welcomed Vistra’s announcement as another sign the global transition from coal to clean energy is accelerating.

“Supporting a fair and robust economic and community transition is a critical next step for Illinois and Ohio,” said Mary Anne Hitt, the Sierra Club’s national campaigns director.

Vistra is the latest company to abandon coal in the Midwest, though it plans to keep operating its coal plants in Texas, including one of the nation’s largest industrial sources of sulfur dioxide, a key ingredient in acid rain and smog.

Two decades ago, that infamous designation belonged to the Baldwin plant, 275 miles southwest of Chicago in Randolph County.

One of Vistra’s corporate predecessors spent $1 billion on pollution-control equipment at Baldwin as part of a 2005 settlement with federal prosecutors, who accused various owners of dodging the Clean Air Act while charging customers billions to keep the plant operating.

Baldwin once burned enough coal to fill the Willis Tower every two months. Today, Vistra only operates one of the plant’s three coal-fired units.

Fast-declining prices for wind and solar power are pushing Baldwin and other coal plants out of the marketplace faster than analysts once predicted. Businesses and households also are becoming more energy efficient, a durable trend that makes power plants built for another era increasingly obsolete.

“I don’t believe (coal) is going to have a renaissance,” Morgan, Vistra’s chief executive, told a television interviewer in April 2018. “I think it’s on its way out.”

This year coal plants are expected to generate less than a fifth of the nation’s electricity, down from more than half a decade ago, according to the U.S. Energy Information Administration.

In addition to Baldwin, the coal plants scheduled for closure by Vistra are Joppa Steam on the Ohio River near Metropolis, Kincaid south of Springfield and Newton in Jasper County.

The company already closed its coal plants in Canton, Coffeen, Havana and Hennepin and agreed to shutter another south of Peoria as part of a legal settlement with environmental groups.

A coalition of clean energy and labor groups is promoting legislation in Springfield that would allocate funding to help workers find new jobs and protect communities from financial hardships when coal plants close.

Vistra is pushing its own measure that would require ratepayers to subsidize the company’s shift to solar power on the sites of its former coal plants.

https://www.chicagotribune.com/news/environment/ct-more-illinois-coal-plants-closing-20200930-bl2saewbzvha3f52r42fcni53y-story.html

Business Shifts From Resistance to Action on Climate

Business Roundtable’s support for putting a price on carbon is evidence of a sea change in corporate attitudes on climate action

By Greg Ip, The Wall Street Journal, Sept. 16, 2020

When Congress last pushed for comprehensive climate legislation a decade ago, much of corporate America was either neutral or hostile.

In a sign of how much corporate attitudes have changed, the Business Roundtable, one of the country’s most prominent business groups, is throwing its support behind broad-based measures to slash greenhouse gas (GHG) emissions. In a statement of principles released Wednesday, the Business Roundtable said it “supports a goal of reducing net U.S. GHG emissions by at least 80% from 2005 levels by 2050.” To achieve that, it endorses putting a price on carbon. It didn’t say whether that should be through a carbon tax or a system of tradable emissions permits.

The content of the principles doesn’t break new ground—many big companies long ago embraced equally or more aggressive goals. The U.S. targeted reducing emissions 80% by 2050 when it joined the international Paris climate accord in 2016.

Rather, the significance of the statement is that it shows how business is shifting from a source of resistance to a force for action on climate. The Business Roundtable statement represents the consensus of more than 200 members spanning every sector of the economy, from retail, finance and technology to health care, manufacturing and even oil and gas.

When the group last put out principles on climate, in 2007, it didn’t endorse mandatory measures such as carbon prices because of internal disagreement and warned against policies with “unacceptable” economic costs.

In 2010 groups like the U.S. Chamber of Commerce and National Association of Manufacturers helped kill Congress’s attempt to create a national emissions trading system. (The Business Roundtable was neutral.) Congress hasn’t taken up anything similar since.

Whether that changes will depend on the outcome of November’s election. During a briefing on California’s wildfires this week, President Trump reiterated his skepticism of the scientific consensus on climate change, and his administration has worked to dismantle the Obama administration’s climate regulations, such as on emissions from power plants, vehicles, and oil and gas wells. In November Mr. Trump began the formal, yearlong process of withdrawing from the Paris accord, over the objections of many chief executives.

On the other hand, Democratic candidate Joe Biden has an aggressive climate agenda including eliminating emissions from electricity by 2035 and net emissions for the entire economy by 2050. In that case, business could play a significant role both in shaping specific proposals and influencing individual legislators.

Much of what the Business Roundtable asks for are typical corporate demands: less regulatory uncertainty, administrative burden and duplication, as well as protection from foreign competitors facing laxer rules.

More notable is what it doesn’t demand. Business and conservative supporters of carbon taxes and emissions permits often want the revenue to be used to reduce other taxes or send checks to households, not fund other government programs. The Business Roundtable, in contrast, doesn’t call for such revenue neutrality. It says some of the money should be used to reduce the impact on “individuals and communities most negatively affected” by climate policies, and to double federal research and development of GHG-reduction technology.

Businesses usually wanted a carbon price to substitute for other regulations, such as energy-efficiency requirements and renewable-energy mandates. While it strongly prefers market-based mechanisms, the Business Roundtable acknowledges a need for regulations where price incentives are less effective, such as building codes, because a carbon price might not incentivize builders to maximize energy efficiency.

The Business Roundtable isn’t in favor of higher taxes and stricter regulation, but they aren’t the red lines they used to be. It doesn’t want to stand in the way of “a result that isn’t entirely perfect from our perspective but is actually a dramatic improvement in the country’s approach to climate,” the group’s president, Joshua Bolten, said in an interview.

He added, “We don’t support the Green New Deal, and we don’t support continuing business as usual; both of those impose significant costs. The right policy would both significantly reduce emissions and keep our economy strong and competitive at the same time.”

The real test of these new principles, then, is whether they translate into actual support for the specific steps Congress or a future administration take. That support has often been lacking in the past: The Business Roundtable, for example, opposed President Obama’s Clean Power Plan to reduce carbon emissions from electricity generation.

Still, businesses aren’t immune to the currents that drive public perceptions, and the broader public is increasingly concerned about the economic impact of global warming, from rising temperature and extreme weather to higher sea levels. Even the U.S. Chamber and National Association of Manufacturers have become more supportive of action on climate, such as participation in the Paris accord.

Neither group, however, has endorsed a carbon price. In part that’s because their larger, more diverse membership includes many smaller companies, whereas the Business Roundtable’s members are principally large, multinational, publicly traded companies. They face greater pressure from customers, employees and shareholders to act on climate. They also do business in jurisdictions with far more extensive climate rules than the U.S.

China, Japan, the European Union and Britain all have, or plan to have, either a carbon tax or an emissions-trading system. Without something similar, U.S. companies risk being penalized abroad. Natural-gas exports, for example, may fail to meet European standards on methane leakage. For many businesses, inaction on climate may be a bigger threat to their long-run health than action.

https://www.wsj.com/articles/business-shifts-from-resistance-to-action-on-climate-11600233503?st=2h0yg8nn2px2go5&reflink=article_email_share

Federal Report Warns of Financial Havoc From Climate Change

A report commissioned by President Trump’s Commodity Futures Trading Commission issued dire warnings about climate change’s impact on financial markets.

By Coral Davenport and Jeanna Smialek

The New York Times, Sept. 8, 2020

WASHINGTON — A report commissioned by federal regulators overseeing the nation’s commodities markets has concluded that climate change threatens U.S. financial markets, as the costs of wildfires, storms, droughts and floods spread through insurance and mortgage markets, pension funds and other financial institutions.

“A world wracked by frequent and devastating shocks from climate change cannot sustain the fundamental conditions supporting our financial system,” concluded the report, “Managing Climate Risk in the Financial System,” which was requested last year by the Commodity Futures Trading Commission and set for release on Wednesday morning.

Those observations are not entirely new, but they carry new weight coming with the imprimatur of the regulator of complex financial instruments like futures, swaps and other derivatives that help fix the price of commodities like corn, oil and wheat. It is the first wide-ranging federal government study focused on the specific impacts of climate change on Wall Street.

Perhaps most notable is that it is being published at all. The Trump administration has suppressed, altered or watered down government science around climate change as it pushes an aggressive agenda of environmental deregulation that it hopes will spur economic growth.

The new report asserts that doing nothing to avert climate change will do the opposite.

“This is the first time a government entity has looked at the impacts of climate change on financial markets in the U.S.,” said Robert Litterman, the chairman of the panel that produced the report and a founding partner of Kepos Capital, an investment firm based in New York. “Rather than saying, ‘What’s the science?’ this is saying, ‘What’s the financial risk?’”

The commodities regulator, which is made up of three Republicans and two Democrats, all of whom were appointed by President Trump, voted unanimously last summer to create an advisory panel drawn from the world of finance and charged with producing a report on the effects of the warming world on financial markets. The initial proposal for the report came from Rostin Behnam, one of the panel’s two Democrats, but the report is written by dozens of analysts from investment firms including Morgan Stanley, S&P Global and Vanguard; the oil companies BP and ConocoPhillips; and the agricultural trader Cargill, as well as academic experts and environmental groups.

It includes recommendations for new corporate regulations and the reversal of at least one Trump administration policy.

“It was shocking when they asked me to do this,” Mr. Litterman said. “This is members of the entire community involved in financial markets saying with one voice, ‘This is a serious problem, and it has to be addressed.’”

A White House spokesman, Judd Deere, declined on Tuesday to comment on the report because the White House had not yet seen it.

Douglas Holtz-Eakin, president of the American Action Forum, a conservative research organization, who served as economic adviser to John McCain’s 2008 presidential campaign, said: “This was initiated by the Trump administration. It is the only document of its type.”

He added, “If you’re denying this exists, you don’t ask for a report on it.”

The Republican chairman of the C.F.T.C., Heath Tarbert, acknowledged the risk of climate change, but he noted that the report also detailed what the regulators called “transition risk” — the financial harm that could befall the fossil fuel industry if the government enacted aggressive policies to curb carbon dioxide pollution.

“I appreciate Commissioner Behnam’s leadership on convening various private sector perspectives on the important topic of climate risk,” Mr. Tarbert said in a statement. “The subcommittee’s report acknowledges that ‘transition risks’ of a green economy could be just as disruptive to our financial system as the possible physical manifestations of climate change, and that moving too fast, too soon could be just as disorderly as doing too little, too late. This underscores why it is so important for policymakers to get this right.”

The authors of the report acknowledged that if Mr. Trump is re-elected, his administration is all but certain to ignore the report and its recommendations.

Instead, they said they saw the document as a policy road map for a Joseph R. Biden Jr. administration.

Mr. Biden’s climate policy proposals are the most ambitious and expensive ever embraced by a presidential candidate, and most of them would meet resistance in Congress. But even without legislation, he could press forward with regulatory changes. Lael Brainard, a Federal Reserve governor who is seen as a top contender to be Treasury secretary in a Biden administration, has called for financial regulators to treat climate change as a significant risk to the financial system.

In calling for climate-driven policy changes, the report’s authors likened the financial risk of global warming to the threat posed by the coronavirus today and by mortgage-backed securities that precipitated the financial crash in 2008.

One crucial difference, they said, is that in the case of climate change, financial volatility and loss are likely to be spread out over time, as they hit different regions and markets. Insurance companies could withdraw from California in the wake of devastating wildfires, and home values could plummet on coastlines and in floodplains. In the Midwest, banks could limit loans during or after extended droughts that drastically lower crop yields. All of those problems will be exacerbated by climate change, but they are unlikely to hit all at once.

“Financial markets are really good at managing risk to help us provide credit, so that the economy can flourish,” said Leonardo Martinez-Diaz, an editor of the report who served as senior official at the Treasury Department during the Obama administration. But, he added, the system breaks down “when it’s no longer able to manage risk, when it’s invisible, it’s not captured by the price of stocks.”

“That’s what we saw in the financial crisis of 2008, and it’s as relevant now on climate change as it was then on mortgage-backed securities,” he said.

Among the first of those risks already pervading the markets, the report’s authors say, are falling home prices and rising mortgage default rates in regions where wildfires and flooding are worsening.

“Climate change is linked to devaluing home values,” said Jesse Keenan, an editor of the report and a professor of real estate at Tulane University in New Orleans.

“If in your town, your house is devalued, that makes it harder for your local government to raise money,” he said. “That’s one set of risks that could lead to a contagion and broader instability across financial markets.”

Extreme weather could cause swings in agricultural commodity prices, the report warns, and climate-spurred market volatility could afflict pension and retirement funds, which invest across a range of asset classes.

“Climate change is one of the top three risks to our fund,” said Divya Mankikar, an author of the report and an investment manager at the California Public Employees’ Retirement System, the country’s biggest public pension fund “We pay pension and health benefits to over two million current and former state employees. So the payout is decades out.”

The report makes several concrete recommendations for inoculating the financial system against potential harm.

It emphasizes the need to put a price on carbon emissions, which is often done either by taxing or through an emissions trading system that caps carbon emissions and allots credits that polluters can buy and sell under that cap.

The report calls for the reversal of a proposed rule being put forward by the Trump administration’s Labor Department that would forbid retirement investment managers from considering environmental consequences in their financial recommendations.

“If there’s any class of investors that should be thinking about the long run, it’s retirement funds and pension funds,” said Nathaniel Keohane, an author of the report and an economist at the Environmental Defense Fund, an advocacy group.

The report suggests that the Financial Stability Oversight Council, a Treasury Department-led body created in the wake of the 2008 crisis, incorporates climate risks into its annual report and its communications with Congress. It suggests that the Federal Reserve and other major financial regulators join international coalitions that focus on climate threats.

The report also suggests that bank regulators should roll out a climate risk stress testing pilot program. Such stress tests, which assess how bank balance sheets and the broader system would fare in bad climate-related economic scenarios, have been under development in Britain and elsewhere in Europe.

The authors also recommend that another financial regulator, the Securities and Exchange Commission, strengthen its existing requirements that publicly traded companies disclose the risks to their bottom lines associated with climate change.

Coca-Cola has noted in its financial disclosures that water shortages driven by climate change pose a risk to its production chains and profitability. But many other companies “just check the box” on that requirement, Mr. Keohane said.

Such disclosures should also include the risk to companies’ bottom lines posed by future policies designed to mitigate climate change, such as taxes or regulations on carbon dioxide pollution, which could hurt fossil fuel producers.

“If carbon risk is priced, this will add cost to the oil and gas industry,” said Betty Simkins, a report author and professor of finance at Oklahoma State University in Stillwater. “But they need to be prepared for this. It’s better for the companies to disclose the risk and be as financially fit as possible.”

https://www.nytimes.com/2020/09/08/climate/climate-change-financial-markets.html

Climate Is Taking On a Growing Role for Voters, Research Suggests

Concern about global warming is steady despite other crises, a survey found, and the number of voters who are deeply engaged on the issue is rising sharply.

By John Schwartz, The New York Times, Aug. 24, 2020

The number of Americans who feel passionately about climate change is rising sharply, and the issue appears likely to play a more important role in this year’s election than ever before, a new survey shows.

What’s more, despite the turmoil caused by overlapping national and global crises, support for action to curb climate change has not diminished. Backing for government to do more to deal with global warming, at 68 percent in May of 2018, was at the same level in 2020, according to the survey, issued Monday.

“People can walk and chew gum at the same time,” said Jon A. Krosnick, a professor of communication, political science and psychology at Stanford University and the leader of the project.

Many social scientists might have predicted a different result. A hypothesis in psychology called the “finite pool of worry” suggests that when people’s level of concern about one issue rises, concern about others tends to fall. Climate change, under such thinking, appeared to be a “luxury good” issue, the sort of thing that’s nice to have if you can afford it, but which gets pushed down the list of priorities in tough times.

The survey, the latest in a 23-year series, suggests that, instead, climate change has become important enough to Americans that it remains prominent despite the global coronavirus pandemic, with its rising death count in the United States, as well as the related national economic crisis, the pressures of self isolation brought on by the pandemic and a never-ending rush of other news.

The most striking part of the survey, Dr. Krosnick said, is the growth of a group he called the “issue public” around climate change.

An issue public is a community that feels an issue is extremely important to them personally. “They are the people who make things happen on the issue,” Dr. Krosnick said. That means, for example, making donations to lobbying groups, sending emails to lawmakers, attending rallies — and voting.

The issue public around climate change has grown tremendously over time, the survey suggests. In 2015, the group was 13 percent of the population. By 2020, it had nearly doubled to 25 percent.

Democratic candidates appear to be reaping the benefits of that shift. For instance, a wave of climate donors has flocked to former Vice President Joseph R. Biden Jr. That’s a departure from 11 years ago, when some party leaders discouraged fund-raising based on climate change.

Dr. Krosnick said the issue public behind climate change, at 25 percent, was now the second-largest he has seen, trailing only the group focused on abortion, at 31 percent. By comparison, the group of American adults who are passionate about gun control generally hovers around 17 percent, and capital punishment weighs in at about 14 percent.

“I would never have predicted this 25 percent,” Dr. Krosnick said. He suggested that President Trump’s efforts to undermine climate science and government initiatives to deal with global warming could be behind the surge. “The Democrats just gained a significant number of people who are powerfully now inclined toward them on the issue,” Dr. Krosnick said. In an election that could, in battleground states, turn into a game of inches, the rise of a passionate community could make a difference, he said.

Of course, interest in an issue doesn’t necessarily translate into votes. That’s why environmental groups have been at the forefront of efforts to raise voter turnout and ensure the integrity of the election, said Myrna Pérez, director of the voting rights and elections program at the Brennan Center for Justice at NYU law school.

“Environmental groups are acutely aware of the fact that their agendas are not going to be accomplished if the vote is not free, fair and accessible,” Ms. Pérez said. “Reform generally is not going to happen unless our democracy is representative and robust and participatory — and the environmental groups are getting it.”

Dr. Krosnick’s survey supported the findings of an earlier one published in May by researchers at Yale University and George Mason University. In that project, 73 percent of those polled said that climate change was happening, which matches the highest level of acceptance previously measured by the survey, from 2019.

The new survey not only corroborates the earlier findings, but extends the period of polling through August as the compounding crises, along with the national tumult over racial injustice and the often-violent police response to demonstrations, dominated the news. What’s more, the results were remarkably consistent across all 10 weeks that the survey was conducted. Data was drawn from calls to 999 American adults, a process that started in May.

The survey was a joint project of Stanford, Resources for the Future, a Washington research group, and ReconMR, a survey research company.

Anthony Leiserowitz of the Yale Program on Climate Change Communication, which released the survey published in May, said the new polling showed that climate change was “not fading from people’s memories, it is not fading from their sense of importance just because other issues have arisen.”

A significant number of people have considered climate change, Dr. Leiserowitz said, and “pretty much made up their minds where they stand.”

https://www.nytimes.com/2020/08/24/climate/climate-change-survey-voters.html?smid=tw-nytclimate&smtyp=cur

Behavioral Contagion Could Spread the Benefits of a Carbon Tax

It’s not too late to fight climate change with a long-overdue policy that would have surprisingly broad impact, an economist says.

Op-ed by Robert H. Frank (Cornell University), The New York Times, August 19, 2020

The United States has been stalled in its approach to climate change, and with attention so heavily focused on the coronavirus pandemic, this may seem an inauspicious moment for action.

But the shock of the pandemic hasn’t merely upended people’s lives. It may also open doors to policy changes previously considered beyond reach. Economic analysis can help identify the most promising opportunities among them.

The economics of climate change is straightforward. Earth is warming both because greenhouse gases are costly to eliminate and because governments have permitted people to emit them into the atmosphere without penalty.

The classical remedy is a carbon tax, a fee on the carbon content of fossil fuels. Generally levied where fuels are extracted or imported, it discourages carbon emissions by making goods with larger carbon footprints more expensive. The World Bank reports that as of 2019, 57 local, regional and national governments have either enacted some form of carbon tax or plan to do so. When people must pay for their emissions, they quickly discover creative ways to reduce them.

Why, then, hasn’t the United States adopted a carbon tax? One hurdle is the fear that emissions would fall too slowly in response to a carbon tax, that more direct measures are needed. Another difficulty is that political leaders have reason to fear voter opposition to taxation of any kind. But there are persuasive rejoinders to both objections.

Regarding the first, critics are correct that a carbon tax alone won’t parry the climate threat. It is also true that as creatures of habit, humans tend to change their behavior only slowly, even in the face of significant financial incentives. But even small changes in behavior are greatly amplified by behavioral contagion — the social scientist’s term for how ideas and behaviors spread from person to person like infectious diseases. And if a carbon tax were to shift the behavior of some individuals now, those changes would quickly spread more widely.

]Smoking rates, for example, changed little in the short run even as cigarette taxes rose sharply, but that wasn’t the end of the story. The most powerful predictor of whether someone will smoke is the percentage of her friends who smoke. Most smokers stick with their habit in the face of higher taxes, but a small minority quit, and still others refrain from starting.

Every peer group that includes those people thus contains a smaller proportion of smokers, which influences still others to quit or refrain, and so on. This contagion process explains why the percentage of American adults who smoke has fallen by two-thirds since the mid-1960s.

Behavioral contagion would similarly amplify the effects of a carbon tax. By making solar power cheaper in comparison with fossil fuels, for example, the tax would initially encourage a small number of families to install solar panels on their rooftops. But as with cigarette taxes, it’s the indirect effects that really matter.

According to a 2012 study by the economists Bryan Bollinger and Kenneth Gillingham, a carbon tax that induced a family to install solar panels could be expected to stimulate a neighbor’s copycat installation within four months, on average. Let another four months pass, and each of these two will have spawned additional installations of their own, for a total of four.

At the end of just two years’ time, these figures suggest, the initial new installation will lead to 32 new installations. Contagion doesn’t stop there, either, since each of these families will have shared news about their projects with friends and family in other locations.

Behavioral contagion also has been shown to influence dietary choices. People often eat meat because they grew up with, and continue to live among, people for whom substantial meat consumption is the norm. Because meat has a large carbon footprint, a carbon tax would make it more expensive relative to plant-based foods.

The direct effect of this price change would be small. But as some people shifted the composition of their diets, others would find it easier to shift as well. In short order, these positive-feedback effects would produce more widespread shifts in eating habits. Behavioral contagion would similarly amplify initial responses to a carbon tax in virtually every other energy-intensive activity.

Even with such gains in prospect, many legislators remain unenthusiastic because they perceive a carbon tax as being unpopular with voters. Many families have been struggling to make ends meet, they might say, and the last thing they need is a stiff new tax on energy use. But this problem has a simple solution, which is to adopt what economists call a revenue-neutral design. Under one version, all revenue from the tax would be returned to consumers in the form of monthly rebate checks.

Because the wealthy consume much more energy than others, they would contribute a disproportionate share of the revenue from a carbon tax. The top 10 percent of all income recipients account for almost half of carbon emissions worldwide, an Oxfam International study has found.

Use patterns are less skewed in the United States, but here, too, the wealthy live in bigger houses, drive bigger cars and, at least when the pandemic isn’t raging, take many more trips to distant destinations. Even with equal rebates per capita, most people would get a monthly check for more than they’d paid that month in carbon taxes. Rebates could, of course, be distributed in a more progressive fashion.

Although low- and middle-income families would be net cash beneficiaries under this plan, the wealthy would pay more in tax each month than they would receive in rebates. Even so, prosperous voters would also come out ahead, on balance.

That’s both because they would benefit disproportionately from the resulting reductions in climate losses and because they would otherwise have to shoulder much of the tax burden of climate adaptation measures. In short, compelling evidence suggests that a carbon tax would improve life outcomes for rich and poor alike.

Had carbon taxes been widely adopted decades ago, the planet would not be facing a climate crisis today. Critics are correct that it is too late for this measure alone to defuse the climate threat. Having waited, it will now be necessary to spend trillions of additional dollars on green infrastructure and other mitigation measures.

But adopting a carbon tax even at this late date would greatly reduce both the cost of achieving climate stability and the time needed to achieve that goal.

https://www.nytimes.com/2020/08/19/business/behavioral-contagion-carbon-tax.html?searchResultPosition=1

Is the carbon tax dead? Not yet, says this senator.

By Shannon Osaka, Grist, Aug. 10, 2020

For years, the idea of putting a price on carbon emissions seemed like a no-brainer — economists claimed that it would cut fossil fuel pollution quickly and efficiently, and at the same time, could even give money back to the American public. But lately the policy has fallen out of favor. Over the past few months, as Democrats have rolled out multiple comprehensive plans to slow down climate change and turbocharge renewable energy, the idea of a “carbon tax” has been notably absent.

One lawmaker doesn’t seem to have gotten the memo. On Friday, Senator Dick Durbin, a Democrat from Illinois, introduced the “America’s Clean Future Fund Act,” which would set a steadily rising price on carbon dioxide emissions. The tax would start at $25 per metric ton of emissions (that’s the equivalent of about 22 cents extra per gallon of gasoline) and rise by $10 or more per year. Given the COVID-19 economic downturn, the bill suggests waiting to institute the price until “the U.S. economy is no longer in economic turmoil due to the current pandemic,” but no later than 2023.

According to an analysis by the Center on Global Energy Policy at Columbia University, a majority of the funds raised by the tax would be returned to low- and middle-income households in the form of rebates — the rest would be used to create a green bank for investments in clean energy, to finance carbon sequestration projects in farms and forests, and to provide support for laid-off fossil fuel workers and communities at risk of sea-level rise or extreme weather.

“This bill is one piece of a comprehensive solution required to combat and protect against climate change,” Durbin said in a statement.

Previous carbon tax proposals haven’t made it very far. According to the Center for Climate and Energy Solutions, Durbin’s bill is the 10th carbon pricing bill proposed in Congress since 2018 — and four of them have had bipartisan sponsorship. Still, most Republicans haven’t shown much interest in climate legislation and, given the Republican-controlled Senate, none of these bills are likely to become law anytime soon. (In fact, the last viable attempt to pass a law with carbon pricing failed during the Obama Administration.)

Durbin’s bill stands in stark contrast to climate plans offered by former Vice President and presumptive Democratic presidential nominee Joe Biden as well as House Democrats. Biden’s plan, released last month, calls for $2 trillion in spending for clean energy initiatives and a transition to 100 percent clean electricity by 2035, but stops short of suggesting a carbon price. The House Select Committee on the Climate Crisis, meanwhile, released a 538-page plan that devoted just two caveat-filled pages to a potential tax on emissions. “Carbon pricing is not a silver bullet,” they warned, adding that any potential tax must benefit low- and middle-income Americans.

The newly introduced plan satisfies that requirement — and indicates that the carbon tax isn’t dead yet on the political left. Durbin is the second highest-ranking Democrat in the Senate, which means that his plan could get an airing if Democrats manage to take control of Congress. And even though history hasn’t been kind to the carbon tax — attempts to pass one in Washington State failed twice, in 2016 and 2018 — the idea is still favored by a majority of Americans.

That includes a cadre of former Republican lawmakers and statesmen, who in 2018, launched an effort calling for a tax with 100-percent of its profits going to American taxpayers. The idea made it into legislation introduced in the House by two Florida representatives, one from each party.

As to whether future Democratic legislators will back a carbon price, or go whole hog on clean energy spending and regulations, it’s hard to say. And anyway, the party will first have to win in November.

https://grist.org/politics/is-the-carbon-tax-dead-not-yet-says-this-senator/