A Bottom Line for the Carbon Tax

The EU prides itself to have established, in 2011, the European Union’s Emissions Trading System (ETS). The EU ETS is claimed to be the cornerstone of the European Union’s policy to combat climate change and a primary tool for reducing industrial greenhouse gas emissions cost-effectively. Involving 31 countries, it is the first and thus far the biggest international greenhouse gas emission trading system. But I argue it is also a failure.

As Australia joins a carbon tax and trading system there is much to learn from examining the effectiveness of the EU ETS and what controls need be implemented in a system to deliver the desired outcomes.

The price of carbon in the European Union’s Emissions Trading System (ETS) just fell below 7 $ a ton for the first time since it was initiated in 2011. This represents a collapse from the price of near 28 $ per ton in 2011. In fact, by mid 2011 the price had already fell down to 10 $ a ton. Seven $ a tone is comparable to the price of carbon in voluntary systems, such as those in place in the US and should, therefore, be considered a failure of the trading system, as there is no point in regulating carbon price if it ends up having the same price as it does in a voluntary system.

The role of any environmental tax is not to collect funds for the state to compensate for the environmental costs of actions that are not embedded in the price system (i.e. so called environmental externalities), but to act as a deterrent promoting the development of alternative, cleaner technologies. The consequence of the collapse of the cost of carbon emissions in the ETS is that companies have no incentive to migrate their processes to low-emission technologies, as it will be cheaper to just pay the tax. This results in a failure of the EU ETS to meet its goals.

The EU ETS works on a ‘cap and trade’ principle where the total amount of greenhouse gas emissions is reduced over time so that total emissions fall. The target is that emissions will be 21 % lower in 2020 than in 2005. The allowable emissions are distributed among companies, which can buy or sell them and can also buy limited amounts of international credits from emission-saving projects around the world.

Whereas total emissions could be regulated by law, without the need for a trading system, the trading system placing a price on carbon was expected to provide incentives for companies to lower emissions and, thereby, achieve a greater reduction in emissions than imposed by the slowly shrinking cap.

The ambition is that the EU ETS be expanded to other nations that are establishing comparable schemes, such as Australia. The European Commission and Australia have reach an agreement in principle to link the EU ETS with the Australian system in mid-2015. Shall this happen at current carbon price in the EU ETS and the targeted starting price in Australia, the consequence will be that Australian companies will purchase EU emission permits massively, thereby quickly drawing down the price of carbon to a level as low as that in EU.

A low green house emission price will never provide incentives to achieve the transition to a CO2 neutral society: it will not drive investment to carbon capture technologies, nor increased efficiency, nor promote renewable energy.

Hence, the current system, that simply regulates total emissions, the cap, and leaves the regulation of the cost per ton entirely to the market of trading permits will not achieve its goals. To achieve the goals the cap and trade system must be complemented with a regulated minimum price on carbon emissions, i.e. must be a cap and trade bottom-line system.

What should this bottom line be? This bottom line should use as reference the calculated social cost of CO2 emissions. Moreover in doing so, it should be considered that, unlike many other gasses which are relatively short-lived in the atmosphere, CO2 emitted to the atmosphere has a life-time of centuries to millennia, so that the every ton of CO2 emitted exerts impacts over a very long time, and can be considered effectively, irreversible (Solomon et al. 2009).

The social costs of CO2 emissions have been calculated at about 43 US $ per ton CO2 (Glaeser and Kahn 2010), implying that a carbon tax of 7 $ a ton only covers one sixth of the impacts the emissions have to society. This implies that humanity is absorbing about 85 % of the cost of the impacts causes by the emissions, as the impacts are felt globally although the benefits and advantages derived from the processes of emissions are felt only within the societies trading the goods produced.

I argue here that the carbon tax and trade system will only achieve the desired outcomes if both the cap is progressively reduced and a bottom line implemented that is progressively raised to close the huge gap between the market-regulated price of CO2 and its social costs.

The upward regulation of the bottom-line should provide incentives for the migration to low-emission technologies. The profits collected from emission permits should be used to pay for the costs of adaptation to climate change not only in Australia but internationally, particularly in the nations that, with very low emissions per capita, are already suffering the impacts of climate change. These are the neighboring island states threatened by sea level rise in the Pacific and Indian Oceans.

References

Glaeser, E.L., and M. E. Kahn. 2010. The greenness of cities: Carbon dioxide emissions and urban development. Journal of Urban Economics 67: 404-418.

Solomon, S., G.K. Plattner, R. Knutti, R. and P. Friedlingstein, P. 2009. Irreversible climate change due to carbon dioxide emissions. Proceedings of the national academy of sciences, 106: 1704-1709.<!DOCTYPE html PUBLIC “–//W3C//DTD HTML 4.01//EN” “http://www.w3.org/TR/html4/strict.dtd”>

Join the conversation

62 Comments sorted by

  1. John Newlands

    tree changer

    I think the bugbears of CO2 penalty schemes are free permits and dodgy offsets. Get rid of those and the auctioned CO2 price should accurately reflect the economy's ability to pay.

    We smirk at the EU's avalanche of free permits yet our smelters get 94.5% carbon tax exemption plus selective cash handouts. If an emitting industry claims it needs special status then give them straight cash. Failing that if they get free permits ensure those permits cannot be resold.

    Offsets which are not globally…

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  2. Jack Smith

    Comedian

    Well if the price of permits is falling it's because the demand for emitting co2 is falling. That means they are relying less on co2 intensive production. Rather than try and adjust the price to some bottom line why not just speed the process up and give out much less permits next year? (assuming the market conditions are right).

    You get a similar result with less complication.

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    1. In reply to Jack Smith

      Comment removed by moderator.

    2. Peter Campbell

      Scientist (researcherid B-7232-2008)

      In reply to Jack Smith

      Indeed! If the price is low it shows that we can function easily with the present level of emission reductions so let's tighten the cap a bit more. Everyone credible says greater emission reductions are needed and presumably the low price of carbon is the evidence that we can do it with little pain.
      Let's get on with it.
      BTW a little point of detail in such schemes. I hope they ensure that voluntary reduction by ordinary individuals are additional to targets. It would be very disheartening if (say) a voluntary purchase of 100% green power were to free up permits for emissions elsewhere. I understand the policy is to recognise voluntary action as additional but it would be good to stay vigilent on this.

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    3. David Arthur

      n/a

      In reply to Jack Smith

      Rather than give out less permits next year, why not let them buy as many permits as they like, but just jack the price of a permit up?

      The clever companies will figure out how to need to buy less permits, and the slow companies will go broke.

      You get a better result with less complication.

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  3. Chris O'Neill

    Telecommunications Engineer

    Carlos: "the trading system placing a price on carbon was expected to provide incentives for companies to lower emissions and, thereby, achieve a greater reduction in emissions than imposed by the slowly shrinking cap."

    I don't know how you can say the trading system price should achieve a greater reduction in emissions than the cap. The price only exists because there is a cap. The price is simply that which is required to bring the supply (the cap) and demand (emissions) into equality. Therefore the price can only bring emissions down to the cap.

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  4. Drew Morris

    Environment Officer

    Couple of points,

    - there's a limit on (Australian) liable entities surrendering no more than 50% IEU's for both the fixed-price and first five years of the flexible-price period. Therefore, regardless of the price of EU credits, Australian polluters will have still have to purchase a minimum number of Australian credits*.

    - also, the author makes no mention of the symptons behind why the price of EU credits has dropped so low - leaving the reader to assume the EU system is simply broken. Surely…

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  5. Dr Graham Lovell

    logged in via Twitter

    This article is good starting point for a better discussion, but it is still stuck in the ETS paradigm, even though an ETS is not the best approach for imposing a carbon price. In addition, the article's suggested modifications to the current ETS thinking do not go far enough.

    The ETS was always dud system, even before the failures of the EU ETS showed this up clearly. The reasons for this are both theoretical and practical.

    A mandated ETS fixes the allowed level of CO2e emissions. That is…

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    1. robin linke

      stamp dealer

      In reply to Dr Graham Lovell

      Dr Lovell, As an admirer of Pauline Hansen's common sense I was always puzzled why so many intellectuals and University educated people attacked her personally whilst offering no solutions of their own.
      You state that a $40 carbon tax should allow us to radically restructure our industry without damaging our competitveness. But you neither give examples of 'radical restructuring' or the base load energy sources required to reduce carbon emissions.
      My understanding is:
      1) The only practical base…

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  6. helen stream

    teacher

    In reply to Jack Smith....

    Why not just admit, as the UK Met has had to ---that there has been no warming for 15-16 years, even as CO2 has risen---no correlation, except that the rise in CO2 we see may be due to the fact that CO2 lags temperature---ie the temperature rise causes the CO2 rise.

    Also, James Hansen said the following in the 70s...apparently never refuted...

    [ [ 'Although the addition of carbon dioxide in the atmosphere does increase the surface temperature, the rate of temperature…

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    1. Jack Smith

      Comedian

      In reply to helen stream

      Yes, of course... who should I learn climate science from? NASA, or people in internet comment sections? You are giving me a tough choice here, might need to sleep on it.

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    2. David Arthur

      n/a

      In reply to helen stream

      Gday Ms Stream, I see you write that "there has been no warming for 15-16 years", so I assume you read the article in the Mail on Sunday by David Rose claiming that the UK Met Office has stated as much.

      It's a shame you haven't also read Dana Nutticelli's debunking of Rose, available at http://www.guardian.co.uk/environment/2012/oct/16/daily-mail-global-warming-stopped-wrong.

      I think you'll find that Dr Hansen's quote from the 1970's alluded to the fact that average temperature increase is…

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    3. helen stream

      teacher

      In reply to Jack Smith

      Jack Smith....

      [ '49 former NASA scientists and astronauts sent a letter to NASA Administrator Charles Bolden last week admonishing the agency for it’s role in advocating a high degree of certainty that man-made CO2 is a major cause of climate change while neglecting empirical evidence that calls the theory into question.

      The group, which includes seven Apollo astronauts and two former directors of NASA’s Johnson Space Center in Houston, are dismayed over the failure of NASA, and specifically the Goddard Institute For Space Studies (GISS), to make an objective assessment of all available scientific data on climate change. They charge that NASA is relying too heavily on complex climate models that have proven scientifically inadequate in predicting climate only one or two decades in advance.']

      Many warmists turn to the Skeptical Science blog to get their information to refute sceptics-----but isn't it run by a hopelessly untalented cartoonist?

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    4. helen stream

      teacher

      In reply to David Arthur

      David Arthur....

      The UK Met Office issued what was touted as a refutation, but it in no way was---in fact within it, was an acknowledgment that the warming has 'paused' for 15 years---and they cite the natural negative forcings as probably, in their opinion, being responsible for that 'reduced warming'.

      The Met....

      [ 'we also know that changes in the surface temperature occur not just due to internal variability, but are also influenced by “external forcings”, such as changes in solar activity…

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    5. Peter Campbell

      Scientist (researcherid B-7232-2008)

      In reply to helen stream

      Essentially, an 'argument from incredulity':
      "... and an incredibly inflated view of the power of coal [even in the absolute infancy of its use]---- to overpower the behemoth of the earth's climate----to turn around a relentless progression towards a full-on new ice age..."

      The whole point of doing science is to deal with questions that are beyond arguments from intuition. It is not good enough to say, 'The earth is so big and humans so little that I simply find incredible the suggestion we could have an impact.' That might have seemed right but diverse streams of corroborating evidence and plausible argument says otherwise. A pity, but now we have to deal with it.

      Anyway, being due for an ice-age could mean as soon as a few centuries or not for quite a few millennia. Let's leave the coal where it is for now. That leaves open the option to burn it a few thousand years from now if we are definitely on the way into an ice-age it still seems a good idea.

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    6. helen stream

      teacher

      In reply to Chris O'Neill

      Chris O'Neill...

      You're outraged , it appears, because of what you see as an ad hominem comment from me re a person who runs a blog that claims to know it all about CAGW, and sees itself as the debunker-in-chief of alternative science on CAGW.

      But I think I can deduce from your views, that you don't mind one little bit that our illustrious Climate Commissioners , with their official brief from the government to inform and educate us all and encourage discussion on this, the 'greatest moral…

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    7. Chris O'Neill

      Telecommunications Engineer

      In reply to helen stream

      "what you see as an ad hominem comment from me re a person who runs a blog that claims to know it all about CAGW"

      Right from your first sentence, you make a strawman. The blog doesn't "claims to know it all about CAGW". It provides citations for virtually everything it points out. Something you could learn from (but probably won't).

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    8. David Arthur

      n/a

      In reply to helen stream

      Ms Stream, that the UK Met Office data shows decreased rates of atmospheric warming is unsurprising: after a couple of decades' rapid atmospheric temperature increase (1980's and 1990's), a greater proportion of accumulating heat is now being retained in the oceans, and transferred to the poles, where sensible heat becomes latent heat by melting ice.

      Other factors include the resumption of high atmospheric sulfate air pollution (courtesy of China), the increased rate of heat dissipation through…

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    9. helen stream

      teacher

      In reply to Peter Campbell

      So you believe, Peter Campbell, that the early effects of the Industrial Revolution were so powerful and so widespread---and produced so much CO2----Northern and Southern Hemisphere---as to produce a global warming that stopped in its tracks a natural progression towards a full-on ice age---and turned it into a warming trend--as David Arthur appears to believe?

      That 'corroborating evidence' and 'plausible argument' only stands because alternative research findings are not tolerated under the regime…

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    10. Peter Campbell

      Scientist (researcherid B-7232-2008)

      In reply to helen stream

      Humans have been modifying the planet surface for quite a while, not just since we started burning coal in earnest. There was a fair bit of deforestation going on in the last few thousand years. At just what point all this was enough to start making a difference might be a matter for reasonable academic debate. That is in the fine detail. That we are making a difference now or could make a difference if we continue with present levels of burning is not seriously doubted.
      Maybe, for quite a while…

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    11. Chris O'Neill

      Telecommunications Engineer

      In reply to helen stream

      "alternative research findings are not tolerated under"

      the biggest conspiracy of all time.

      "If you were not a warmist, but a reviled sceptic like me"

      That should read "fake sceptic".

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    12. David Arthur

      n/a

      In reply to helen stream

      Ms Stream, the early stages of the end of the Little Ice Age were most likely attributable to changes in solar radiation output, that much is apparent. Beyond that, large-scale deforestation contributed massively, compared to which the onset of fossil fuel use was relatively small.

      It's worth noting that ~50% of all anthropogenic CO2 emissions have occurred in the last three decades; the world won't be experiencing the bulk of the impacts of these last three decades until you and I are dead and…

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    13. helen stream

      teacher

      In reply to David Arthur

      .David Arthur....

      To deal with your last demand first...I'll cite some websites etc, and with the rest you can use key words and look for them yourself.

      Where are your own references---where do you cite your sources??

      Eg when you assert..

      ' the coal industry will wind down and cease over the next 20 years as China and India start to appreciate the effects of climate change.'

      The reality is....

      China and India are building new coal-fired power stations every week—

      World Resources…

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    14. David Arthur

      n/a

      In reply to helen stream

      Gday Ms Stream, you write:"Nowhere did I pretend that Hansen expected temperature to decrease with increasing atmospheric CO2---that's a confection of yours."

      You are quite correct, I misunderstood what you wrote, and I stand corrected on that point.

      You then go and blow your credibility out of the water with this howler: "The logarithmic nature of its effect is limiting---it takes the catastrophic out of CAGW."

      A logarithmic function, Ms Stream, is MONOTONIC - no limit is ever attained…

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    15. Berthold Klein

      Civil-Environmental engineer

      In reply to David Arthur

      Helen Stream : you are correct that there is no creditible experiment that proves that the greenhouse gas effect exist. Here are just a few references that the use of circumstatial evidence to make a point that the AGW's will end up with their feet frozen in the ice in the Arctic and the Antarctic.

      Most Arctic Ice Gain Ever Recorded: 'With a few weeks of growth still to occur, the Arctic has blown away the previous record for ice gain this winter'

      'This is only the third winter in history…

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    16. Berthold Klein

      Civil-Environmental engineer

      In reply to Berthold Klein

      1.David Arthur referenced the web-site “skeptic Junk science”,this website is controlled by John Cook and many radical environmentalists. They have been caught faking data and results. Don't take my word, check for yourself anything that I write and anything you read on the skeptic junk science website.
      Below is a blog exchange on another string on “The Conversation” . Geoffrey is a true scientist and a worthwhile skeptic -a seeker of truth.

      2. Geoffrey Harold Sherrington commented:
      "Berthold…

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    17. David Arthur

      n/a

      In reply to helen stream

      Gday Ms Stream, thanks for challenging my assertion " the coal industry will wind down and cease over the next 20 years as China and India start to appreciate the effects of climate change."

      The reality is....

      China is choking in its own air pollution. Google "beijing air pollution", and you'll get more references than you can poke a stick at.

      You rightly note that: "China and India are building new coal-fired power stations every week—" giving references. Thanks for that, you've alluded…

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    18. Peter Campbell

      Scientist (researcherid B-7232-2008)

      In reply to Chris O'Neill

      Thank you Chris O'Neill. All that verbiage dismissed for the shameless red herring it is with one pertinent URL.

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    19. David Arthur

      n/a

      In reply to Berthold Klein

      Thanks for that, Mr Klein.

      The reason that the Arctic winter refreezing area is getting bigger and bigger is that ice melt the previous summer is getting bigger and bigger due to warming Arctic Ocean. Then, with onset of winter, there's huge amounts of open water that can lose heat to the atmosphere, and it freezes.

      However, it's only relatively thin, single-year ice, that will readily melt away again the next year.

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    20. David Arthur

      n/a

      In reply to Berthold Klein

      Thanks Mr Klein. You write: ".. correct that there is no creditible (sic) experiment that proves that the greenhouse gas effect exist. Here are ..."

      The greenhouse effect is a necessary consequence (a corollary, as it were) of the following first principles.

      Earth is warmed by absorption of short wave sunlight. Because of this, Earth's temperature can remain unchanged by returning the same amount of energy to space. That is, solar shortwave energy is balanced by the earth re-radiating…

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    21. David Arthur

      n/a

      In reply to Berthold Klein

      Thanks for all that, Mr Klein. You've argued quite eloquently that the greenhouse effect does not exist.

      Any such argument is, of course, complete balderdash; the physics of the greenhouse effect is described in Section 9.3 of Maarten Ambaum's postgraduate text, "Thermal Physics of the Atmosphere".

      Perhaps Ambaum can clarify your confusion?

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    22. David Arthur

      n/a

      In reply to David Arthur

      Err, I've found an error in my calculations: that value of $606 billion foregone export income due to Australia not converting all its iron ore and pellets exports in 2009/10 to iron and steel, is incorrect, and is much too high.

      I've corrected my calculation, and estimate the foregone export income is only $135 billion in 2009/10, which is only ~4 times Austalia's coal export income, not 17 times Australia's coal export income.

      Mind you, either way, the economy would be stengthened, not weakened by my changes, rather than remaining in the enfeebled state demanded by Ms Stream.

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    23. Berthold Klein

      Civil-Environmental engineer

      In reply to David Arthur

      As I and most other real scientists have pointed out on many occasion the "greenhouse effect" was proved by Robert W. Wood in 1909 to be "confined space heating"
      The pretend scientist miss use the term "greenhouse effect" a real phenomenal experienced every day in every part of the world, when they should be addressing the "greenhouse gas effect". The greenhouse gas effect" was proposed as a Hypotheses in 1824, the hypotheses has never been proven to exist.
      I am waiting to get a copy of Maarten Ambaum postgraduate paper section 9.3 to see if he is intelligent enough to properly define the differences between the "greenhouse effect/confined space heating" and the fictional "greenhouse gas effect"
      Until them David anyone that uses "greenhouse effect" to address the "greenhouse gas effect" is showing that they are not a real scientist but a political snake oil salesman, a promoter of lies.

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  7. Jessika Richter

    Researcher at IIIEE

    I agree with Drew Morris and others here in the point that this article simplifies the story of the EU ETS. Whether or not it is a failure is dependent on what you are expecting from it. High expectations have not been met, like with so many climate policies on any scale and for many of the same reasons. The academic literature points to both the recession in the EU as well as loose caps set by member states in the first two phases as drivers behind the low prices (see for example the work of Ellerman…

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    1. David Arthur

      n/a

      In reply to Jessika Richter

      Thanks for this well-argued comment, Ms Rickter.

      My concern is that your thinking remains bound by EU orthodoxy, and I encourage you to read Oxford Energy Policy Professor Dieter Helm's "The Carbon Crunch - How We're Getting Climate Change Wrong - and How to Fix It".

      One problem with a focus on carbon emission production is that, thanks to globalised trade, you can outsource your emissions by importing all your manufactures from China. This is what the EU has done, and is why its emissions…

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  8. Gerard Dean

    Managing Director

    The European ETS has been manipulated and rorted by un-elected Eurocrats resulting in it's collapse.

    Germany, long the Green's poster nation, is now building 20 coal fired power stations courtesy of cheap Polish coal and even cheaper European ETS credits.

    Our Australian government, in their wisdom, recently decided to tie our carbon tax to the European ETS.

    The future of our scheme is now controlled by faceless, un-elected Eurocrats in Brussels who will absolutely no account of Australia's concerns if they decide to start manipulating the price again.

    They are not accountable to us and we cannot vote them out. And why are we doing this? To reduce the earth's temperature.

    Academics in a 1000 years are going to study the newspapers of our times and scoff at our hubris in imagining we can manipulate the earth's temperature with a carbon tax on Australia's industries.

    Hopefully, we only have 8 months of this rubbish to go.

    Gerard Dean

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    1. David Arthur

      n/a

      In reply to Gerard Dean

      Mr Dean writes: "Academics in a (sic) 1000 years are going to study the newspapers of our times and scoff at our hubris in imagining we can manipulate the earth's temperature with a carbon tax on Australia's industries."

      I'd suggest that academics ~10 centuries hence will peruse our News Corp rags and ponder the reckless stupidity that imagined that anthropogenic climate change could have been avoided in the absence of Australia changing its ways.

      Just as lice are a problem shared by birds of many feathers, Mr Dean, climate change will degrade the world of rich and poor, (fowl and fare?) alike.

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  9. David Arthur

    n/a

    Why don't they just get rid of all this emission capping nonsense, and just fix a price? Every year thereafter, put the price up. What do they do with all the carbon emission revenue? Why, give everyone a tax cut so they can either buy more fuel or buy solar panels to lock in the savings in future years.

    1. Start cutting taxes.
    2. Make up the revenue shortfall with a consumption tax on fossil fuel.
    3. Cut more taxes, and continue making up the revenue shortfall by increasing the rate…

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    1. Peter Campbell

      Scientist (researcherid B-7232-2008)

      In reply to David Arthur

      There are pros and cons in both what you suggest (a price but no cap) or emissions trading (a cap but no fixed price). A price gives some certainty since the price is known and can be planned for. The difficulty is that it is hard to set a price that achieves the desired outcome. Set the price too high and we get large emission reductions but damage the economy more than necessary. Set the price too low and everyone just pays a bit extra to pollute without reducing emissions at all. If the price…

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    2. David Arthur

      n/a

      In reply to Peter Campbell

      Thanks for that thoughtful comment Peter, notably the comment that the major benefit of an emissions cap is that emissions reduction outcome is assured. I'm not sure that is the case, as discussed by John ED Barker's 2 December 2011 'The Conversation'piece "You can’t manage emissions until you can measure them, and it’s harder than you think", https://theconversation.edu.au/you-cant-manage-emissions-until-you-can-measure-them-and-its-harder-than-you-think-4518

      It's also worth noting that the…

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    3. Peter Campbell

      Scientist (researcherid B-7232-2008)

      In reply to David Arthur

      You may well be right. I don't claim any particular economic expertise. Frankly, I wonder at reluctance to make some serious cuts in fossil fuel use.
      I am lucky to have an above average income but I am not all that far above average. It has not cost me a lot to greatly reduce my consumption of fossil fuel and many of the things I have done are saving me money-IE profitable. Yet still people don't do it!
      Over the years I improved our house's insulation, got solar hot water etc. so now we buy only…

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    4. robin linke

      stamp dealer

      In reply to Peter Campbell

      David ,You seemed to have overlooked a fundamental requirement of the carbon tax/cap and trading and that is it has to close down fossil fuel power stations and replace them with base load power sources that are carbon free.
      What are these carbon free base load power sources, given the fact that the crusaders for saving the planet reject Nuclear Hydro?

      You accuse others of rejecting science & reason when you and many others like yourself appear to lack basic common sense. Your policy of taxing fossil fuels will simply make power for industry more expensive, sabotaging Australian jobs and exports.

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    5. David Arthur

      n/a

      In reply to Peter Campbell

      Thanks Peter.

      I most certainly correct about the sub-optimality of derivative trading as a mechanism for guiding the way to a non-fossil fuel future, and have made similar points on articles at 'The Conversation' by such economist luminaries as Ross Garnaut, Frank Jotzo and others.

      In each case, I've invited the author of the article to respond to my arguments, and none have ever done so. If you search for an acronym I coined - FFCT - for Fossil Fuel Consumption Tax, you'll find many such…

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    6. Chris O'Neill

      Telecommunications Engineer

      In reply to robin linke

      "a fundamental requirement of the carbon tax/cap and trading and that is it has to close down fossil fuel power stations"

      No, the fundamental requirement is to reduce their CO2 emissions which can happen by reducing their energy output and thus their requirement to burn fossil fuel.

      If, say, solar cells can reach grid parity while the Sun is shining then the fossil fuel power stations don't need to run at those times while they may still be needed when the Sun isn't shining. This could bring about a very large reduction in CO2 emissions, even though the fossil fuel power stations are still running some of the time.

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    7. robin linke

      stamp dealer

      In reply to Chris O'Neill

      Chris, Your assumption that solar cells or any other renewable can replace coal fired power stations during the day is totally wrong.It is also irresponsible not to know this, especially as you are a telecommunications engineer.

      The largest solar power station in the world is in Arizona and produces a maximum of 250MW, is costing $1.45 billion of which $1.2 billion is a US govt grant, and its surface area of 1920 acres is equivalent to the land area of 10,000 houses and has storage of 6 hours…

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    8. Chris O'Neill

      Telecommunications Engineer

      In reply to robin linke

      "The largest solar power station in the world is in Arizona and produces a maximum of 250MW"

      354 MW actually, soon to be 550 MW, but I guess as a stamp dealer you don't need to be concerned about maintaining any credibility regarding engineering. While it is true that solar cells need more area than fossil burning or nuclear power stations, I would have thought most people are aware that solar cells can be and are installed on rooftops.

      "has storage of 6 hours which means it needs 100% back…

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    9. robin linke

      stamp dealer

      In reply to Chris O'Neill

      In reply to Chris O'Neill:
      Abengoa Solar are building the plant at Gila Bend in Arizona and I quoted their specs. 354MW and 550 MW were never quoted, If they expand it to 550MW it will have an area of 20,000 houses and still only deliver 50% of the power of a nuclear or coal plant.area several hectares with an 85% subsidy by tax payers..
      So your statement that ' solar cells need more area than coal or nuclear is a laughable mockery of the truth. A 1000MW solar power station (or cluster) needs…

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  10. David Arthur

    n/a

    Dr Duarte, thanks for preparing a balanced appraisal of the EU ETS. Various articles for the Conversation by various academic economists over the last few months seem trivial in comparison.

    As it happens, one academic economist who has prepared a reasoned appraisal of the EU ETS is Oxford's Professor of Energy Policy, Dieter Helm; his "The Carbon Crunch - How We're Getting Climate Change Wrong" is well worth reading.

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  11. Berthold Klein

    Civil-Environmental engineer

    David Arthur, I am waiting to get a library copy of Maarten Ambaum's postgraduate text. I will not pay money for a document that I know has errors in it.
    Here is a document that shows why Section 9.3 is crap. There are many more similar scientific paper that show the “greenhouse gas effect” is a fairy-tale not even a hypotheses.

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    The Manmade CO2 Global Warming Fraud!
    Robert A. Ashworth
    Published on EnergyPulse -http://www.energypulse.net/centers/article/article_display.cfm?a_id=2563
    Introduction…

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    1. David Arthur

      n/a

      In reply to Berthold Klein

      Thanks for that, Mr Klein.

      You latest Gish dump (not gallop, dump: 'dump' in the colloquial American sense) begins with Robert A Ashworth cluelessly reporting that at the onset of Pleistocene interglacial warm periods, temperature start rising some 8 centuries before atmospheric CO2.

      This furphy about temperature rise preceding CO2 increases neglects the mechanism which initiated interglacial warm periods.

      1) At the end of a glacial period ("Ice Age" for the hoi polloi) precessions in…

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    2. Berthold Klein

      Civil-Environmental engineer

      In reply to David Arthur

      As I and most other real scientists have pointed out on many occasion the "greenhouse effect" was proved by Robert W. Wood in 1909 to be "confined space heating"
      The pretend scientist miss use the term "greenhouse effect" a real phenomenal experienced every day in every part of the world, when they should be addressing the "greenhouse gas effect". The greenhouse gas effect" was proposed as a Hypotheses in 1824, the hypotheses has never been proven to exist.
      I am waiting to get a copy of Maarten Ambaum postgraduate paper section 9.3 to see if he is intelligent enough to properly define the differences between the "greenhouse effect/confined space heating" and the fictional "greenhouse gas effect"
      Until them David anyone that uses "greenhouse effect" to address the "greenhouse gas effect" is showing that they are not a real scientist but a political snake oil salesman, a promoter of lies.

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    3. David Arthur

      n/a

      In reply to Berthold Klein

      Dear Mr Klein, you are quite correct that greenhouses are warmed because their glass walls retard convective heat transfer but permit radiative heat transfer.

      Here, I use the terms "greenhouse effect" and "greenhouse gas" in the senses that the are most commonly used in polite conversation, at least on this planet. In particular, I use these terms in accordance with usage of the Bureau of Meteorology (Climate Glossary - Greenhouse effect
      www.bom.gov.au/climate/glossary/greenhouse.shtml).

      By all means, try selling your snake oil at their door.

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  12. Gerard Dean

    Managing Director

    The author states, 'The ambition is that the EU ETS be expanded to other nations that are establishing comparable schemes, such as Australia.'

    Some ambition!

    The European Emissions Trading Scheme has been rorted, ripped off and manipulated by faceless Eurocrats in Brussels so much that it is a joke. It is an environmental measure in word only. It allows the green poster nation Germany to build 20 coal fired power stations with cheap Polish coal and cheap Euro ETS tickets.

    In view of the…

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    1. Chris O'Neill

      Telecommunications Engineer

      In reply to Gerard Dean

      "It allows the green poster nation Germany to build 20 coal fired power stations"

      Isn't that what you want?

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  13. Gerard Dean

    Managing Director

    According to his promo 'The blue diamond.', the author 'travels the world investigating what global change is doing to aquatic systems'. In view of his passionate call for me to stop using fossil fuels, I sincerely trust he does all his world travelling by sailing boat alone.

    But if he does not, if he climbs aboard the odd A380, or Mercury powered Zodiac or diesel propelled research ship, he has an ethical problem.

    Perhaps the author can tell us how he travels the world.

    Gerard Dean

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  14. Berthold Klein

    Civil-Environmental engineer

    Why Have a "carbon tax" when the greenhouse gas effect does not exist?

    David still has not come up with a credible experiment. All his supposed proofs of a ghge are circumstantial evidence at best. The real temperature data shows there has not been an average earth temperature change in 16 going on 17 years. Now many parts of the world are experiencing the coldest winters they have had in a 100 years. These areas will need there fossil -fuel sources to provide cheap heat and energy. The environmental…

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    1. Peter Campbell

      Scientist (researcherid B-7232-2008)

      In reply to Berthold Klein

      Amazing how atmospheric physicists and diverse ecologists and just about every scientific discipline in between have consistently and mistakenly misinterpreted their observations and made simple high school errors in their reasoning to come up with a unified view of human-induced climate change (differing only occasionally on relatively minor details).
      I guess it is similar to the way diverse biochemists and geologists and every discipline in between have come up with a unified view on how evolution consistently explains diverse observations in biology (differing only occasionally on relatively minor details), yet a few creationists can spot the few simple errors that show it is all wrong.
      I wonder if climate change deniers are over-represented among creationists and vice-versa?

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  15. Berthold Klein

    Civil-Environmental engineer

    Here is an Experiment that shows that the ghge does not exist! Where is the experiment that shows it does exist?
    The Experiment that Failed which can save the World Trillions:
    Proving the “greenhouse gas effect” does not exist!
    By Berthold Klein P.E (January 15, 2012)
    Edited by John O’Sullivan, incorporating comments by Dr. Pierre Latour, Professor Nasif Nahle, Edward J. Haddad Jr. P.E, Ganesh Krish, and others.
    Dedication:
    To Professor Robert W. Wood (1909), the first scientist to demonstrate…

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    1. David Arthur

      n/a

      In reply to Berthold Klein

      Another dump from Mr Klein. Here's just one of the fabrications, from his "Section 2:The definition-the Clues", where Mr Klein writes:
      6. The concentration of CO2 found in MILLION-year-old ice cores can be utilized as proof that the “GHGE” exists.

      Bad News, Mr Klein: as yet the ice-core record extends back only ~800,000 years.

      I also bothered to read the "experiment": fill some balloons with various gases, and put some thermometers in the shadows they cast on a sunny day, so that the thermometers measure ambient temperature in the shade on a sunny day.

      Result: multiple measurements of ambient temperature on a sunny day.

      Perhaps Mr Klein could visit his local meteorological observatory for advice on how to conduct his experiment.

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