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re: EPA regs to kill nuclear power
Posted on 12/1/14 at 4:08 pm to SpidermanTUba
Posted on 12/1/14 at 4:08 pm to SpidermanTUba
quote:The same way the government determines what the cap should be in cap-and-trade: they make a best estimate.
How does the government determine what the tax should be?
Both schemes are arbitrary to the extent that a carbon tax sets the price and lets the market seek the optimal level of emissions, while cap-and-trade sets the optimal level of emissions and lets the market seek the price.
But if there's one thing markets hate more than higher energy prices, it's higher and more volatile energy prices. Plus, most cap-and-trade schemes only address the electricity sector and that's a minority of emissions; you'll need ancillary taxes anyway to address transportation and manufacturing, so why not just combine them? And carbon taxes leave less room for special interests and grandfather clauses which make them toothless. A carbon tax bill can be written in a page or two. You need a whole new regulatory scheme for cap-and-trade, since you're trying to create a new market from scratch.
1
Posted on 12/1/14 at 10:03 pm to Iosh
quote:
The same way the government determines what the cap should be in cap-and-trade: they make a best estimate.
Both schemes are arbitrary to the extent that a carbon tax sets the price and lets the market seek the optimal level of emissions, while cap-and-trade sets the optimal level of emissions and lets the market seek the price.
But if there's one thing markets hate more than higher energy prices, it's higher and more volatile energy prices. Plus, most cap-and-trade schemes only address the electricity sector and that's a minority of emissions; you'll need ancillary taxes anyway to address transportation and manufacturing, so why not just combine them? And carbon taxes leave less room for special interests and grandfather clauses which make them toothless. A carbon tax bill can be written in a page or two. You need a whole new regulatory scheme for cap-and-trade, since you're trying to create a new market from scratch.
The "optimal level of emissions" is zero net emissions. The subjectivity comes in determining how long we should take to get there.
I prefer the cap & trade approach. The price the market sets is far more accurate than then price the government sets. Yes - it would be more volatile over short periods - but over the long haul the market would set the best price.
Cap & trade can encompass transportation. California's cap & trade is going to do that in 2015. its just a question of writing the law.
This post was edited on 12/1/14 at 10:04 pm
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