Global environment

Question ;
In the absence of a worldwide agreement to
reduce co2 through the carbon tax, how effective
might it be if just one country, or small number
of countries, instituted a tax unilaterally?
 Global Warming and CO2
Major greenhouse gas and their primary sources

Proportionate
Gas Major source
effect(%)

Fossil fuel combustion, deforestation,

CO2 49
cement production

CH4 (Methane) 18 Landfills, agriculture, termites

N20(Nitrous oxide) Fertilizers, land clearing, biomass

6
burning, fossil fuel combustion

Other (CO, NOX,..) 13 Various

 CO2 Content of the Atmosphere
• CO2 Content of the Atmosphere
– combustion of fossil fuel, together with deforestation and a few other
activities, has led to an increase In CO2 content of the atmosphere by
about 20 percent from the beginning of the industrial revolution.
– In the last three decade alone, it increase 8%
– Many scientists predict an approximate doubling by the middle of next
century.
• World temperature
– The earth has warmed about 0.5 HC o (1 H F) over the past 100 years.
– Some scientists models predict that over the next century temperatures
could rise 1.5 to 4.5 H C.
– The rate of heating may increase from 0.05 H C to 0.3 HC per decade.
– In the past of agricultural societies, it occurred at the rate of only about
0.04 HC per decade.
– The rate of change is expected to be very much faster than the past.
– Sea level may rise 33 to 66 cm by 2100.
Four factors of the quantity of CO2 Emissions

• Population
• GDP per capita
• Energy efficiency
• CO2 produced per unit of energy used
 Kyoto Protocol
• International negotiators propose the Kyoto
Protocol in December 1997 setting targets for
emissions reductions for individual industrialized
countries.
• For the most key industrial country, the reduction
are about 8% (7% for USA) from the 1990 level by
years 2008-2012.
• Protocol permits a combination of carbon sinks
and emission reductions to reach targets.
• Agriculture becomes a potential major sink.
• Carbon trading.
 Means of the Reduction

 Energy production
• Reduce demand for electricity .
• Switch to non-fossil fuels (solar, biomass, nuclear,
hydroelectric.
• Switch from high-carbon (coal) to low carbon (gas)
fossil fuels.
• Reduce energy transmission losses.
• Remove carbon from fuel and emissions.
 Means of the Reduction

• Households
• Industry
• Transportation
• Agriculture and food system
• Forestry
 Reforestation and sequestration

• One hectare of land can sequestrate 3 to 10

tons of carbon per year.
• Tree plantation can sequestrate 6.24 tons per
hectare.
• But it depends on the soil condition,
production practice, and incentive.
 ECONOMIC benefit rer ton of less emissions or of more carbon sequestration

Analysts Benefit from carbon reduction Comments

Fankgauser and $20/ton (Global) Simplified model; covered

Pierce 1994 range of carbon levels

Nordhaus 1993; $6/ton in year 2000 to Measured by tax justified to

Nordhaus and $21/ton in 2100 (Global) bring marginal cost in line
Yang 1996 with marginal benefit in
efficient solution

Brown 1998 8 to $59 (Global) Summary from eight studies

Actual range was from zero
to $300. Numbers to left
most likely range.

Mendelsohn and Zero (U.S) Gains to farming,timber,and

Neumann 1998 recreation industries; loss to
coastal,energy, and water
sectors
Cost-effectiveness of Alternative Means of Reducing CO2,
United State

• Co-firing boilers with natural gas 510

• Early retirement of coal plants, replaced 280
with non-fossil fuels
• Increase energy efficiency in homes. 175 to 300
• Increased energy in commercial buildings -190 to 75
• Cogeneration-commercial 85 to 210
• Increased fuel efficiency cars -220 to -110
• Increase fuel efficiency in light trucks -510 to -410
• Mass transit 1150 to
• Cogeneration-industry 23,00
• Urban tree planting 55 to 120
• Afforestation with CRP* 180
• Increased CO2-Absorbing capacity through 35
management of existing forests 150 to 200
 International Efforts
• To achieve an international agreement.
• To make a program that can apply in all
sources for all countries.
• To be globally cost-effective program.
• Transferable discharge permit system is
suggested.
• It can reach low carbon development path.
 International Efforts
• Equiproportionate reduction in emissions.
• Ability to pay. Base emission reduction/ transfer
payment on current per capita income levels.
• Polluter pays principle. Base emission reduction/
transfer payment on current or past contributions
to the problem.
• Equal per-capita consumption. Base emission
reductions on the idea that all per capita
consumption levels should be the same.
ECONOMIC AND CARBON EMISSIONS DATA FOR SELECTED COUNTRIES.1987

Population GDP Total Emissions Emissions Emissions

Country percapita emissions per capita per dollar (%of total)
(millions)
($) (millon tons) (tons) GDP (grams)

320 578 0.56 2,024 9.6

China 1,031.9 133 1.5
54.3 16,234 92 1.70
France 655 2.2
685.2 371 130 0.19
India 18,506 1,139 5.03 276 18.9
226.5
United States
World (average 6,030 1.08
of total)
 Strategies
• Taxes
• Incentives and Subsidies
• Rules and Regulations
• Researches
• Educations
 Tax and Enforcement
 Tax may require $ 45 per ton to reduce 20% of
CO
 It may increase up to $140 to reduce the 50%.
 This may be burdensome for developing
countries.
 UN lacks executive power to monitoring and
enforcement regarding the environment.
 International court of justice also lacks
mechanism of enforce ruling.
 Moral pressure play vital role.
 Carbon Tax
• Environmental tax on emission of carbon dioxide
and other green house gases
• Pollution tax
• Indirect tax – a tax on transaction – as opposed
to a direct tax, which taxes incomes
• Carbon tax is effectively on the use of fossil
fuels, and only fossil fuel
• Creating incentives for energy conservation,
such as wind, solar and others
 Purpose
• The purpose of a carbon tax
– To protect the environment by reducing
emission of carbon dioxide and thereby slow
climate change
– Implemented by taxing the burning of fossil
fuels; coal, petroleum products and natural
gases in proportion to their carbon content
– UK has unilaterally introduced a range of
carbon taxes and levies to accompany the EU
ETS trading regime
 Implementation
• Many other countries have yet to decide whether to use
a carbon tax or a cap-and-trade scheme.

• Australia: In 2007, the Productivity Commission

suggested that a carbon tax should implemented
• European Union: On January 1, 1991, Sweden enacted
a carbon tax, on the use of oil, coal, natural gas,
liquefied petroleum gas, petrol and aviation fuel used in
domestic travel. Industrial user paid half and high energy
industries were fully exempted from these taxes
• Ireland: Speculated that the carbon tax will be
introduced in the emergency April 2009. This has been
criticized as rushed by some groups
 Implementation Cont’d
• Canada: On February 19, 2008,
announcement to implement a carbon tax
• United States: In May 2008, the Bay Area Air
Quality Management District, which covers nine
counties in the San Francisco Bay Area, passed
a carbon tax of 4.4 cents per ton
• New Zealand: In 2005, it had planned carbon
tax in April 2007 but it has been abandoned in
December 2005 as the minor parties supporting
the government opposed the proposed tax
 Advantages of a Carbon Tax
• Less complex, less expensive, less time-consuming
implementation especially effective when applied to
market like gasoline or home heating
• Reduced risk of certain types of cheating. Credit must by
verified
• Reduce incentives for companies to delay efficiency
improvements as occurs when companies are given more
carbon credits if they pollutes more in the past
• Does not disadvantage new or growing companies relative
to more established companies are given more carbon
credits if they polluted more in the past
• Greater transparency. It is clear what effect the policy has
on the price of energy
 Efficiency
• A car bon tax would avoid significant year to
year fluctuations in costs
• Setting the tax equal to the estimate of the
marginal benefit of emission reductions would
motivate reductions that cost less than their
anticipated benefits
• It could build on the administrative infrastructure
for existing taxes on such as excise tax on coal
and petroleum
 Criticism
• Carbon tax have been criticized for being unduly harsh
on certain social groups, particularly those who live in
rural areas
• As they are requires to travel more by car and are
confined to a limited home fuel mix and the elderly who
are most at risk of fuel poverty
• Some supporters of carbon taxes have suggested that it
would be fairly easy to compensate those most affected.
• In Ireland, carbon tax is a matter of concern for rural
dwellers who make up a significant proportion of the Irish
population and claimed that a carbon tax would weigh
more heavily on rural households
 Conclusion
• Effectiveness – Low benefit
– Boundaries – wind, air, water,

• Isolation – far away from other area

• Overwhelming Idea – public awareness,
community participation,