Four years ago The Star ran an article of mine in “Guestwords” titled “Reason for Hope.” In it I gave some reasons to be optimistic about the prospects for action on climate change, despite the results of the 2016 election. I spoke of the growing numbers of conservatives in public life, industry, and the media who were speaking up in favor of action. My mistake was to predict that they would have some influence on the Trump administration.
President-elect Biden is appointing knowledgeable people who understand the need for action. The question is whether the necessary bipartisan support will emerge in the new Congress. We will need a small but vocal group of Republicans willing to join with Democrats on a workable plan. The need for bipartisan support means that any strategy to mitigate climate change will have to depend mainly on market forces rather than regulation.
Such a market-based strategy is embodied in a bill now before Congress called the Energy Innovation and Carbon Dividend Act. The expiring Congress did not pass it, but it will be reintroduced in the new one, where it may have better prospects.
This bill has three major provisions:
A fee will be charged to the producers and importers of fossil fuels in proportion to the carbon that is emitted when they are burned. The fee will start out small and increase gradually over time, to ensure a smooth transition to the new low-carbon economy.
The money collected will be distributed to the American people equally, a full share to each adult and a half share to each child. This will compensate for the inevitable rise in energy prices. Most of this money will go to low and moderate-income households who will spend it, thus driving the creation of millions of new jobs.
A tariff will be placed on imports from countries that don’t have a carbon-pricing scheme in place. This will remove any incentive for American business to move operations offshore in order to escape the impact of the carbon fee.
Economists of all political persuasions agree that an increase in the price of fossil fuels will result in decreased demand for them. But that’s not all. Carbon pricing will also bring about an explosion of new carbon-conserving technologies.
Readers of a certain age will remember the energy crises of the 1970s, with long lines of cars waiting to get the limited supply of gasoline that was available. Industrialists envisioned a future powered by coal and nuclear energy, while environmentalists placed their bets on renewable energy, but they both thought that the world was running out of oil and natural gas.
Some economists predicted that rising energy prices would spur the development of new technologies leading to increased oil and gas production. Most experts, however, held that there were few additional resources that could be recovered, and all the technology in the world wouldn’t change that.
The economists, it turned out, were right. Directional drilling, fracking, and other inventions unlocked huge amounts of oil and natural gas that had been known to be there all along but thought to be so tightly bound to their rock strata as to be beyond reach.
For the same reason, placing a price on carbon will drive the development of new technologies in energy efficiency, renewable energy, next-generation nuclear energy, hydrogen production, carbon sequestration, and the infrastructure needed to pull it all together. Some of these are fairly predictable; others may come out of the blue.
The likely impact of proper price signals on technology development, along with the more mundane economic transition driven by supply and demand, makes pricing carbon the number-one strategy for dealing with climate change.
To be sure, carbon pricing isn’t the whole answer. Agriculture needs to be reformed to reduce its huge emissions of the potent greenhouse gases methane and nitrous oxide, which are not covered by carbon pricing. And although carbon pricing will reduce the need for regulation, rules will still be appropriate for situations where markets work imperfectly.
An example is in new home construction, where some builders, left to their own devices, would install the cheapest heating and cooling equipment and skimp on insulation in order to compete on selling price, with the buyers left to pay the resulting outsized energy bills. Still, carbon pricing must be the keystone in any coordinated approach.
The time for action is now. It’s not just about polar bears. It’s about us — and our children and grandchildren. Please join a group that is promoting change. My favorite is the nonpartisan Citizens Climate Lobby (citizensclimate.org), but there are others. Just be sure to pick one that advocates a plan that will be effective and that has a fighting chance of being enacted. The Energy Innovation and Carbon Dividend Act is such a plan.
John Andrews, who has a Ph.D. in physics, did research on solar energy and energy-efficient buildings for 25 years at Brookhaven National Laboratory. He lives in Sag Harbor.