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Elon Musk: Only a Carbon Tax Will Accelerate the World's Exit from Fossil Fuels

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Re: Elon Musk: Only a Carbon Tax Will Accelerate the World's Exit from Fossil Fuels

#111

Post by alerkay »

pzone wrote: post #101
alerkay wrote: post #93

Earlier quoted context omitted.

Thinking about your post, I think you have a point there. I noticed that in his speech, Elon Musk doesn't talk at all about what form the carbon tax should take. In reality, if a carbon tax went into action, 90% of its effect would hit fossil fuel companies and nobody else. Am I wrong? How do you implement a carbon tax then?

Suppose we want a tax of $50 / ton of co2 emitted. Then we do some chemistry and figure that burning 5 barrels of oil emits a ton of co2 into the air. Then the government adds a tax of $10 per barrel. Every producer who buys from the gasoline refiner has to pay the tax. Individual gas stations and consumers wouldn't have to think about it, since they aren't purchasing from refineries directly. But the prices they pay…

That seems pragmatic enough to me, and also quite effective. I live in France and, unless I'm wrong, the highest of the oil-related taxes here apply to the consumers, when you're getting gas at the gas station. Instead, your proposition - to apply a $10 tax on the barrel - would apply the same taxation on any fossil fuel usage, be it plastic fabrication, air transportation, electricity generation, etc... That makes a lot more sense environmentally-speaking.

Re: Elon Musk: Only a Carbon Tax Will Accelerate the World's Exit from Fossil Fuels

#113

Post by icelancer »

TheWoodsy wrote: post #112

Carbon tax in Australia. All extra expenses were passed along down the chain to the consumer. We got rid of the tax. Prices stayed the same. sigh Implementation and/or regulation is key.

>Implementation and/or regulation is key.

Sounds like it worked perfectly as designed. That's what happens when things are regulated.

Re: Elon Musk: Only a Carbon Tax Will Accelerate the World's Exit from Fossil Fuels

#114

Post by crdoconnor »

TheWoodsy wrote: post #112

Carbon tax in Australia. All extra expenses were passed along down the chain to the consumer. We got rid of the tax. Prices stayed the same. sigh Implementation and/or regulation is key.

>Carbon tax in Australia. All extra expenses were passed along down the chain to the consumer. We got rid of the tax. Prices stayed the same.

In general if a corporate think tank said something happened or something is going to happen and it impinges upon their profits, there's a better than even chance they're lying through their teeth.

See also: minimum wage, regulation of the financial sector, anything to do with debt, etc.

Re: Elon Musk: Only a Carbon Tax Will Accelerate the World's Exit from Fossil Fuels

#115

Post by crdoconnor »

bigiain wrote: post #12
eru wrote: post #3

Earlier quoted context omitted.

If it's revenue neutral and lowering income taxes, where would the big `victims' be?

The answer used to be "aluminum smelters" (aluminum, aka "frozen electricity"). Interestingly, the aluminum smelters in the mountains behind Portland closed down when the datacenters moved in and bought all the cheap hydro electricity they used to use. My guess is that a tax increase on electricity will hit the Google/Facebook/Amazon/Apple/Microsoft and other "cloud businesses" pretty hard...

Aluminium smelters in Germany are actually getting a big subsidy. They're varying their electricity usage based upon the output of Germany's solar/wind farms and getting paid a hefty sum to do so (possibly too much).

This is having a negative impact on other smelters across the world.

Effectively they're doing the same job we were always told batteries would do.

Re: Elon Musk: Only a Carbon Tax Will Accelerate the World's Exit from Fossil Fuels

#116

Post by tonyedgecombe »

maxharris wrote: post #65
zardo wrote: post #57

Earlier quoted context omitted.

Then we really lucked out, although it would still be a bummer about the corals. (And shell fish, acidification is already disrupting oyster farming in Washington)

If the choice is between people having electricity and clean, running water in India, or corals dying out, it isn't moral to choose the corals. Human lives matter.

We don't need to choose between these, it's developed world lifestyles that are causing the problem, not basic hygiene in the developing world.

Re: Elon Musk: Only a Carbon Tax Will Accelerate the World's Exit from Fossil Fuels

#117

Post by reitzensteinm »

pzone wrote: post #55
danieltillett wrote: post #30

I used to think that carbon taxes were the way to go, but I have seen how effective the fossil fuel industry is at creating FUD. When you consider an effective carbon tax makes all their assets worthless it is not surprising that they will do whatever it takes to block anything other than a nominal carbon tax. There really is only one way to get past the fossil fuel industry and that is to buy them out. Given the ben…

This is a point which gets overlooked pretty often. It's the same as the value of taxi medallions in the Uber debate. Allowing Uber to operate in a city where technically only medallion owners were supposed to drive is actually really shitty to the owners of those medallions. You open it up, suddenly tell them that their investment is worthless because of a change in regulations. It's really unfair to them. Perhaps t…

It's not "really shitty" to the owners of the medallions, the risk of a loss of the artificial monopoly should have been baked into the price from the start.

That the prices got as high as they did indicates the confidence the owners had over the stability of their political situation, which I have no sympathy for.

Re: Elon Musk: Only a Carbon Tax Will Accelerate the World's Exit from Fossil Fuels

#119

Post by netcan »

When it comes to carbon reduction using tax, tradable, caps or any other instrument that tries to use the price system to alter consumption levels… I think you need a very sober economic estimate of efficiency and cost. A tax is not very different economically from other price increases in carbon fuels. These prices vary a lot over time. We also already have fairly variable taxes between countries on the use of carbon fuels for (eg) cars.

Here's oil: http://www.nasdaq.com/markets/crude-oil-brent.aspx?timeframe...

The price varies a lot. Consumption does not vary that much or that fast. This is called price inelasticity of demand. Demand does not drop much for incremental increases in price. This means that to decrease consumption we'd need a very high carbon tax. In Europe, petrol has been taxed heavily for a long time and prices are higher than in the US. The long term effect has been somewhat smaller cars, not a completely different transportation market.

There are also the realpolitik problems. When the public is concerned about something (say water), it's not impossible to convince the public (consumers) to bear a burden. But, entrenched economic interest are harder to sway or wrangle. This leads to weird regulation. An area where water use is distributed 15/35/50 between households/industry/agriculture will successfully enact water restrictions of some sort on households, the minor participant. There are equivalents in energy.

I'm not saying do nothing, but I am saying be smart. Some plans are winers from a public debate perspective but do not solve the problem. I am against a plan that acts a a regressive tax affecting the middle and lower classes harshly unless it is going to have a big impact.

If a household with $4,000 annual fuel costs (heating and transport) is to pay $7,000, the overall expected result better be big steps towards carbon goals. I have a hard time seeing this happen.

Lets do a back of the envelope: take that $5.3 trillion externality at face value. Lets assume the world's 2 billion top consumers pay the majority of it. Call it 4 trillion, $2k each, $8k for a family of 4. How much of a reduction will we see? 10%? 25%?

I'm not completely down on the idea. Elon Musk suggests lowering taxes elsewhere, being revenue neutral. This is a realistic politics problem again. Lets say we can do that though, globally. Reduce bottom level income tax and value added taxes by this much, people would be less harmed. Still, transport & heating make up a large part of poorer people's income so it's hard to think of a way this would not be regressive. I'm sure it is theoretically possible, but very hard.

At the end of this ramble, I'm not sure where I am. I'd like to see a realistic estimate of actual reductions in emissions. This is too big a deal not to fix the problem.

Re: Elon Musk: Only a Carbon Tax Will Accelerate the World's Exit from Fossil Fuels

#120

Post by greglindahl »

crdoconnor wrote: post #115
bigiain wrote: post #12

Earlier quoted context omitted.

The answer used to be "aluminum smelters" (aluminum, aka "frozen electricity"). Interestingly, the aluminum smelters in the mountains behind Portland closed down when the datacenters moved in and bought all the cheap hydro electricity they used to use. My guess is that a tax increase on electricity will hit the Google/Facebook/Amazon/Apple/Microsoft and other "cloud businesses" pretty hard...

Aluminium smelters in Germany are actually getting a big subsidy. They're varying their electricity usage based upon the output of Germany's solar/wind farms and getting paid a hefty sum to do so (possibly too much). This is having a negative impact on other smelters across the world. Effectively they're doing the same job we were always told batteries would do.

If they're paying a fair amount for electricity, it's not a subsidy. And it's probably not a minute-timescale change like batteries. Energy storage and batteries are quite different things.
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