Komanoff: The Time Has Never Been More Right for a Carbon Tax (U.S. News)
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Komanoff asks: If efficiency hasn’t cut energy use, then what? (Grist)
Komanoff: Senate Bill Death = Win for Climate (The Nation)
Q&A: Charles Komanoff (Mother Jones)
Our post last Friday about Build Back Better was already pushing the boundaries by contending that the Biden infra plan won’t actually cut CO2 50% by 2030, when we added this at the end:
We suspect that even a starter, “proof of concept” carbon tax at this time will prove to be a poor idea. Passing a carbon tax in lieu of aggressively raising taxes on high income and instituting taxes on great wealth, as several Senate Democratic climate hawks floated today, amounts to budget-balancing on the backs of both the working poor and the beleaguered middle class. It’s inequitable and a terrible template for the really large carbon taxes that progressive Democrats must eventually enact, in the event they ever reach centrist-proof majorities.
But wait: CTC is supposed to be supporting efforts to pass a U.S. carbon tax. Why, then, were we throwing darts at the Senate Democrats’ trial balloon that was aimed at doing just that?
We have four reasons:
- We don’t think Congress can pass a carbon tax in 2021 anyway.
- We believe the carbon tax under discussion won’t offer sufficient protection to ordinary Americans.
- We doubt that any carbon tax under discussion can generate big enough emission cuts.
- We fear that Democratic backing for a carbon tax at this time will make it harder to defeat the climate-denying G.O.P. in the 2022 midterms.
Things were moving fast last Friday afternoon and we weren’t able to polish our remarks. Now, with a bit more time, let’s unpack these points.
1. Congress can’t pass a carbon tax in 2021 anyway.
The make-or-break Senate votes aren’t there. Manchin of West Virginia won’t vote for a carbon tax, Sinema of Arizona can’t be counted on, and it wouldn’t be surprising if a few Senate or House Democrats facing tough re-elections defected as well. And no Republicans will come on board. Carbon-tax proponents and other climate hawks have waited in vain for over a decade for a single sitting Republican member of the Senate to stand up for strong climate action just once. There’s no reason to think our prayers are about to be answered.
2. The carbon tax under discussion won’t protect enough ordinary Americans.
President Biden has pledged not to raise taxes on Americans earning less than $400,000 a year. A straight-up fee-and-dividend, which is the type of carbon tax CTC most strongly favors, would violate that en masse, despite being strongly income-progressive.. The reason: most six-figure households are high-carbon consumers and thus would be carbon-taxed more than they would be dividended.
If you’re unsure about that, consider the main finding of Anders Fremsted and Mark Paul’s superb 2017 paper for U-Mass’s Political Economy Research Institute, A Short-Run Distributional Analysis of a Carbon Tax in the United States: While 84 percent of households in the bottom income half would be made better off with carbon dividends, only 55 percent of all households would be beneficiaries. Simple arithmetic on those two propositions indicates that only 26 percent of the more affluent households would benefit. (The calculation: 84% of the bottom half equals 42% of all households. The remaining 13 percentage points of beneficiaries constitute just 13%/50%, or 26%, of the top half.) The optics of squaring such a carbon tax or fee with the pledge aren’t promising.
(If Fremsted and Paul’s finding seems too pessimistic, consider this alternative scenario: if 90 percent of bottom-half households were posited as better off, and same for 65 percent of all households, then the share of upper-half households being made better off would come to 40 percent — higher than the 26 percent above, but still a minority of that group.)
To be clear, CTC has no qualms about raising taxes on the very-affluent as well as the super-rich to make a better society. But raising taxes on the working poor and the beleaguered middle class is another matter entirely. And to the extent that the carbon tax under discussion is meant as a pay-for — literally, to pay for improving America’s physical and social infrastructure — less money will be available for dividends. It’s one thing to set aside a few percent of carbon fee revenues to pay for worker and community transitions, as outspoken climate hawk Sen. Sheldon Whitehouse (D-RI) proposed this summer; but it’s another thing altogether to set aside, say, 25 percent for pay-for’s. Having only 75 percent of carbon revenues available for dividends will consign millions of non-affluent households to paying more for energy and energy-intensive goods than they receive as dividends.
3. The carbon tax under discussion won’t generate big emission cuts.
This objection is somewhat speculative because, perhaps understandably, no Senate Democrat has yet attached a level to their carbon tax trial-balloon. But there’s a tendency to overstate what a modestly-sized carbon tax can accomplish.
For example, Resources for the Future, the influential environmental think-tank cited in last Friday’s New York Times story that touched off the latest carbon tax discussion, projects that a carbon tax that starts in 2023 at $15 per metric ton, rises slowly to $30 in 2028 and then jumps to $50 in 2030, will cut CO2 emissions in that year by 44 percent from 2005 levels. That would represent an 1,850 megatonne drop in emissions from 2019. But plugged into our carbon tax model, those inputs yield only a 775 megatonne drop, or much less than half as much. To be sure, RFF’s modeling also includes a clean electricity standard (a close cousin of the Clean Electricity Performance Program in the Biden package that we discussed in our earlier post), but the CEPP would be partly duplicated by the carbon tax and thus wouldn’t account for the bulk of the difference between our respective model results.
Would we support the more modest RFF carbon tax nonetheless if it could be guaranteed to be economically progressive in the aggregate? You bet we would. Our concern on this score is what we telegraphed in our Sept 27 post: the need to neutralize undeserved hype being vested in any climate policies, including carbon taxes.
4. Democratic backing for a carbon tax now will make it harder to defeat the climate-denying G.O.P. in the 2022 midterms.
We won’t belabor this point. Too much depends on the Democrats’ retaining full control of Congress in next year’s midterms and having a good shot at holding on to the White House in 2024. We believe a lot more organizing, educating and communicating about the power, fairness and benefits of carbon taxes remains to be done before the party is somewhat safely inoculated against the inevitable blowback against even an economically progressive carbon tax. Much of that effort will need to go into bringing environmental justice and other progressive activists into the fold.
What kind of carbon tax does the Carbon Tax Center want?
CTC wants a carbon tax that can pass, that’s certifiably progressive (economically), that is robust enough in its per-ton rate to be able to help eliminate game-changing amounts of CO2 and fossil fuels, and that won’t cause gross damage to the Democratic Party’s brand and thus make it easier for the Trumpian right to regain power.
Translated: We want a fee-and-dividend carbon tax, i.e., a carbon fee whose revenues are returned to U.S. households as equal, pro rata dividends and not used as pay-for’s. The enormous sums needed for climate and a broad array of other infrastructure — amounts that will rise over time as institutions and industries are mobilized to deliver the goods — can and should come from rising taxes on undertaxed forms of wealth: very high incomes, ultra-large fortunes, great inheritances, corporate earnings, and offshored and other avoided taxes.
This structure will let the carbon tax rise steadily over time and perform the function it does best: instill the price incentives and social signals to steer U.S. households, businesses, habits and norms away from fossil fuels and into the broad array of alternatives — everything from bicycles and denser living patterns to wind turbines and solar roofs — that won’t heat our climate beyond repair.
Since April, when President Biden committed the United States to sweeping cuts in greenhouse gas emissions, climate advocates have tried to figure out how he could fulfill his goal of a 50 percent reduction from 2005 levels by 2030.
Their talk is not of a government-led Green New Deal — too hot for a skittish Congress — but of a tapestry of GND-ish policies, many of them wonky. Heading the list are schemes to shovel government cash to utilities that shut down coal- and gas-fired power plants, and to motorists who go electric.
There’s sense in these and the other policy pieces, just as there’s logic in refraining from the one overarching policy that could lead the way to the deep cuts Biden is seeking: an economy-wide carbon tax. Giving businesses and households money to go green is more palatable, though less potent, than charging them for burning carbon.
But it’s fair —imperative, actually — to ask if the numerical cuts being attached to those programs actually add up to 50 percent. We don’t think they do; the hill is too steep. Compared to pre-pandemic (2019) carbon emissions, Biden’s goal entails a massive cut, 42 percent, in under a dozen years.
Decarbonizing on that kind of scale falls outside the bounds of the possible without a stiff carbon emissions price. Our purpose here is to show why, and also point a way around.
To kick off this discussion, consider Robinson Meyer’s June 2021 Atlantic article, A “green vortex” is saving America’s climate future. Its big idea was that “decarbonization by doing” — deploying more electric cars and more grid storage systems and more solar panels — is driving down these low-carbon technologies’ costs, naturally leading to more deployment and increasingly kicking fossil-fueled cars and power plants to the curb.
It’s an attractive if familiar notion, this “green vortex.” Sit back, let green energy grow cheaper and bigger, and watch carbon emitters fade to black. But Meyer overhypes it. After outlining the high points of U.S. carbon reductions over the past decade, he states:
Under America’s new Paris Agreement pledge, the country will need to double the pace of its emissions decline over the next decade. Whatever we’re doing right, we’re soon going to have to do it twice as fast. So we’d better figure out what it is. (emphasis added)
We posed these questions to Meyer, after running calculations on U.S. CO2 emissions from fossil fuel burning. By our count, which is fully detailed in our carbon-tax spreadsheet (see link, three paragraphs below), those emissions totaled 6,070 megatonnes (million metric tons) in 2005 and 5,250 megatonnes in 2019. That computes to 60 fewer megatonnes each year. The task ahead — dropping another 2,215 megatonnes to slim down to 3,035 (half of the 6,070 benchmark) — requires that from 2019 to 2030 we purge 200 megatonnes each year —3.4 times the annual rate of shrinkage from 2005 to 2019.
In Meyer’s telling, thanks to the green vortex we’ll manage to double our established pace of decarbonization. He might be right. But what if doubling our average annual decline in emissions from 2005-2019 won’t fulfill Biden’s pledged 50 percent cut by 2030? What if it only yields a 35 percent reduction from 2005 emissions, the standard benchmark? What if cutting emissions 50 percent requires that from now to 2030 future U.S. emissions must come down three to four times faster than they did in 2005-2019?
(Perhaps Meyer, who didn’t reply to our email, used 2020 rather than 2019 as his goalpost. That would give him his “doubling,” but meaninglessly. A year that completely upended energy commerce — in which U.S. air travel fell by a third, for example — might be defensible as a new goal post, but not as a basis for computing a new downward trend.)
To grasp how hard it will be for the Biden administration to bend the emissions curve sharply downward without a carbon tax, let’s look at key sectors. A good tool for that is the national carbon-calculator spreadsheet maintained by the Carbon Tax Center (downloadable 3 MB xls).
The Biden plan’s centerpiece is an idea that has become a darling of climate hawks, the Clean Electricity Performance Program. It’s a $150 billion scheme to decarbonize U.S. electricity generation by paying utility companies to replace coal- and gas-fired plants with carbon-free power from wind, solar, biomass or nuclear sources.
Just over 30 percent of U.S. carbon emissions came from the power sector in 2019, down from 40 percent in 2005, a noteworthy drop that accounted for most of the reductions that Meyer touted in The Atlantic. Let’s assume, as do the White House and its climate allies, that the CEPP’s cash incentives leverage falling prices of solar and wind electricity to achieve the canonical goal of eliminating 80 percent of 2019 power sector carbon emissions by 2030.
The complementary, longer-standing climate policy cornerstone, to “electrify everything,” rests on the eminently reasonable premise that decarbonizing electricity is simpler than mass-producing low-carbon versions of gasoline, natural gas and other carbon fuels. Our calculations optimistically accelerate the uptake of electrified transportation by five years by having the electric shares of cars, trucks and planes in use in 2030 reach levels that in our opinion otherwise aren’t likely until 2035: 20-25 percent for autos, 11-12 percent for trucks and 4 percent for airliners. Those shares are pretty aggressive for 2030, considering that vehicle fleets turn over relatively slowly.
The carbon reductions from this scenario are creditable. With electricity 80% decarbonized and electric vehicles advanced by five years, U.S. CO2 emissions from burning fossil fuels would be 35 to 40 percent less in 2030 than they were in 2005. The reduction, more than two million metric tons of CO2 a year, would qualify as by far the greatest extinction of carbon pollution in history.
But why isn’t the reduction 50 percent? Reason #1 is ever-burgeoning travel. Unless policy interventions like road pricing, public transit and density-friendly upzoning can take root on a grand scale — unlikely in just a decade — the emission reductions from hastening electric transportation will largely be offset by more travel, especially as vehicles on our roads grow ever bigger and more power-demanding.
To be sure, our calculations omit other wonky but potentially potent forms of decarbonization such as widespread replacement of gas furnaces by electric heat pumps. Nor do they incorporate low-hanging fruit from reducing the number two greenhouse gas, methane, both via process capture and as a concomitant to phasing out this fossil fuel altogether.
But we should also be mindful that our most crucial assumption — that we’ll double electricity generation’s carbon-free share from 40 percent today to 80 percent by 2030 — is far from assured. Assume that our aspirational 80 percent carbon-free 2030 electricity comes as 24 percent solar photovoltaics, 32 percent wind, and 24 percent combined from nuclear, hydro-electricity and biomass. Getting to 24 percent solar demands that between now and 2030 we install solar cells three-and-a-half times as fast as we have in any three-month period to date, a task that could easily be sidelined by any number of issues involving supply bottlenecks, permits and certifications.
And if that’s not daunting enough, consider that for wind power to contribute its assigned 32 percent, we’ll need to add the equivalent of 75,000 giant wind turbines rated at 5 MW each to America’s landscapes. Numerically, that equates to 25 turbines per county in the U.S. — a formidable task even if America’s NIMBY culture could somehow be conquered. And all of these targets will be even larger if, as seems likely, the CEPP holds down electricity prices, neutralizing what would otherwise be a helpful brake on demand for power.
Since April, we’ve combed policy papers and journalism about fossil fuel emissions for an accounting of cuts that together might meet the Biden 50% target, or at least come close.
The best compilation we found is a policy brief signed by 20 mainstream and environmental justice organizations and released earlier this month by the Center for American Progress. It’s crisp and precise, as is the Sept. 17 write-up, In the Democrats’ Budget Package, a Billion Tons of Carbon Cuts at Stake, by Inside Climate News journalist Marianne Lavelle, that linked to it.
The above graphic from the CAP brief (downloadable pdf) gives a good overview. Since it’s a lot to take in, we’ve broken it into three pieces.
- Fourteen policies included in Biden’s Build Back Better Act, summing to reductions of 22%. We’ve already covered the three largest, pertaining to clean electricity and electric vehicles. They sum to a 22% reduction from 2005 emissions. We haven’t checked the individual numbers, but the overall figure appears solid.
- “Additional Regulatory and State Action,” assigned a reduction range of 5%-7%.
- Two ongoing trends summing to reductions of 23%. The item at far left, 19%: Progress from 2005 to 2021, is supposed to denote the fall in U.S. greenhouse gas emissions from the 2005 baseline. The companion entry at the top, 4%: Current Trends Through 2030, applies forward from 2021. Together, these items purport to deliver large emission reductions without any new policies — along the lines of Rob Meyer’s “green vortex.”
The percentages credited to the three pieces would indeed carry the Biden plan across the 50 percent reduction threshold. But item #2, unspecified regulatory and state action, is vague and squishy. Worse, #3, “ongoing trends,” is numerically questionable. The CAP policy brief projects that 2030 emissions will be 23 percent below 2005 levels with no further policy actions (known as “business as usual”). Yet our modeling says that 2030 business-as-usual emissions will be just 13 percent under 2005 — a 10 point difference from CAP.
That’s no petty discrepancy. It’s also hard to parse in a blog setting. In addition, we don’t know how CAP and its partners derived their figures (ours are shown in the carbon-calculator spreadsheet we linked to earlier). All the same, here are our hunches as to why CAP’s forecasted emissions trajectory is much lower than ours:
- Like Meyer in The Atlantic, CAP could be projecting future emissions from pandemic-depressed 2020 emission levels. In contrast, we think this year and next will bring big rebounds.
- CAP may not be accounting for “natural” emissions growth accompanying increased economic activity. Our modeling of business-as-usual emissions has 2030 matching 2019, as decarbonization of electricity is offset by emissions caused by increased travel and industrial activity.
- CAP’s figures cover all greenhouse gases, including methane, forest sequestration of carbon, and other activities, whereas ours only cover carbon emissions from burning fossil fuels, which tend to be less amenable to change.
Our takeaway is that CAP and its partners are straining to be able to validate the ambition in Biden’s Build Back Better Act to cut emissions by 50 percent.
As noted earlier, a 35-40 percent cut from 2005 to 2030 would still be praiseworthy, even monumental. We would take it in a heartbeat, given the parlous state of American politics and governance. Nevertheless, we ought to be candid about what our policy tools can, and can’t, accomplish.
The point of this post isn’t to weaken support for the Biden package. Monumental cuts are absolutely worth legislating. Nor are we seeking to beat the drum for a carbon tax at this juncture. As CTC has stated repeatedly this year, as early as in this April 2 post, the kind of carbon tax needed to embellish those cuts can’t possibly pass Congress in 2021.
We also suspect that even a starter, “proof of concept” carbon tax at this time will prove to be a poor idea. Passing a carbon tax in lieu of aggressively raising taxes on high income and instituting taxes on great wealth, as several Senate Democratic climate hawks floated today, amounts to budget-balancing on the backs of both the working poor and the beleaguered middle class. It’s inequitable and a terrible template for the really large carbon taxes that progressive Democrats must eventually enact, in the event they ever reach centrist-proof majorities.
Rather, our intent is to try to neutralize the unattainable hype around Build Back Better or other laudable efforts that can’t or don’t include robust carbon pricing.
In case you’re curious, however — we certainly were — we ran our model numbers to see how big a carbon tax would be needed to meet the Biden goal and cut 2005 U.S. CO2 emissions by 50 percent in 2030. Here’s our answer: combined with the CEPP or other measures to ensure 80% decarbonization of electricity (vis-a-vis 2019), along with the same 5-year acceleration of electric cars, trucks and planes we assumed earlier, an economy-wide carbon tax taking effect on Jan. 1, 2022 at a level of $20 per ton (short, not metric) of CO2 and rising each year at $15/ton to reach $140/ton in 2030, would do the trick.
Addendum, Sept 27: Our brand-new follow-on post, Why the Carbon Tax Center Questions the Latest Carbon Tax Talk, elaborates on our critique of the current carbon-tax trial balloon discussed directly above.
 Compared to 2005, CO2 emissions in 2030 in this scenario will have fallen by only 23 percent for cars and 9 percent for trucks while increasing by 18 percent for planes, even with accelerated electrification. Another factor holding back emissions progress is increased use of natural gas, as cheap fracked gas finds abundant uses in industry and heating.
 The 24 percent combined electricity share for nuclear, hydro and biomass assumes that 2030 generation from those sources remains at current levels. (Their share shrinks slightly because total electricity production rises somewhat; see next footnote.)
 Our modeling projects that without a carbon tax, U.S. electricity generation will rise from 4,160 terawatt-hours (TWh) in 2019 to 4,800 TWh in 2030, with around a fourth of the increase attributable to electrified transport. Solar’s 24% share of that, 1,153 GWh, requires nearly 900 GW of installed solar capacity, assuming that a GW of solar produces around 1.3 TWh of electricity in a year, for an average capacity factor of 15%. From several sources, including this recent report by the Solar Energy Industries Association, U.S. installed solar at the end of 2020 was around 100 GW. To grow to 900 GW by the end of 2030, the U.S. solar sector would have to add 800 GW over 10 years, or 80 GW a year. From this report by Wood-McKenzie, the U.S. installed 5.7 GW in 1Q 2021 — a 1Q record — which implies an annual rate of 23 GW.
 Assuming an average capacity factor of 35%, wind power’s assumed 32% share of U.S. 2030 generation, 1,537 TWh, requires 500 GW of installed capacity, for a roughly 380 GW increment over end-of-2020 capacity of 122 GW, per U.S. DOE. We optimistically assume an average new-turbine size of 5 MW, although an Internet check on Sept 16, 2021 suggests that the U.S. has no operating wind turbine as large as 5 megawatts (see Windpower Monthly’s Ten of the Biggest Turbines). The U.S. has 3,006 counties.
 “The Climate Test: The Build Back Better Act Must Put Us on a clear path to cutting climate pollution 50% by 2030.” Statement, “20 Groups Call on Congress To Pass the ‘Climate Test.’” 4-page policy brief (pdf).
This post was updated, and its headline slightly altered, on July 13, 2021.
A bill introduced in June by Senators Sheldon Whitehouse (D-RI) and Brian Schatz (D-HI) envisions a hefty price on U.S. carbon dioxide emissions from all sources along with pollution charges on the three primary “criteria” air pollutants — particulates, sulfur dioxide and nitrogen oxides — from large stationary sources near environmental justice communities.
The Save Our Future Act (101-page downloadable pdf) prices CO2 emissions at $54 per metric ton, equivalent to $49 per U.S. (short) ton, starting in 2023, with the price rising each year by a percent equal to 6 percentage points on top of the rate of general inflation.
The bill also proposes to charge emissions of fine particulates, nitrogen oxides and sulfur dioxide from qualified “major sources” (a legal term defined at 42 U.S.C. 7661) located within a mile of any environmental justice community (see definition and discussion further below). In addition, a border adjustment mechanism would prevent carbon leakage and ensure fairness for U.S. manufacturers, according to a press release from Sen. Whitehouse’s office, while an “environmental integrity mechanism” would raise the charges on CO2 and other greenhouse gases if needed to keep shrinking emissions fast enough to meet a 2050 net zero target.
Pushing the Envelope
The Whitehouse-Schatz bill pushes the envelope of carbon tax legislation. The starting price of $49/ton — pegged to OMB’s conservative estimate of the social cost of carbon — represents a new high. So does the annual increase rate of general inflation plus 6%. Both figures surpass the Climate Leadership Council’s long-standing proposal to start pricing CO2 at $40/ton and raise that price 5% faster than annual inflation (to be fair, the council’s 2017 price base translates to $45/ton or more in 2023, the Whitehouse-Schatz bill’s start year).
The Save Our Future Act is co-sponsored by Senators Martin Heinrich (D-NM), Kirsten Gillibrand (D-NY), Jack Reed (D-RI), Chris Murphy (D-CT), and Dianne Feinstein (D-CA). The Whitehouse press release says the bill is supported by the Utility Workers Union of America, the New York City Environmental Justice Alliance, New York Lawyers for the Public Interest, The Nature Conservancy, Environmental Defense Fund, National Wildlife Federation, American Sustainable Business Council, Citizens Climate Lobby, Clean Air Task Force, and the World Resources Institute, although sources have reported that neither of the New York groups have formally endorsed it.
We ran the CO2 price in the Save Our Future Act through CTC’s carbon tax model (which you may download via this link). The results, shown above, indicate that the bill won’t fulfill its stated objective to cut carbon emissions in half within a decade, though, to be fair, our modeling doesn’t reflect additional impacts from the prices on the three localized pollutants. Nor does our model capture the likely low-hanging fruit of curbing emissions of methane and other greenhouse gases.
Still, the price-compounding built into the bill limits its efficacy somewhat; even the unprecedented proposal to raise the rate 6% faster than inflation doesn’t boost the price nearly as fast as a straight-up $10/ton annual increment. (Simple math suggests that, with 2% annual inflation, the price won’t spin off annual increments of $10/ton or more until it has reached $125/ton.)
How carbon revenues are used has become central to carbon taxing’s equity and politics. The following four bullet points, taken from the Whitehouse press release, summarize the Save Our Future Act’s proposed treatment:
- Environmental justice communities: The bill would invest roughly $255 billion over 10 years in existing energy affordability, pollution reduction, business development, career training, and tribal assistance programs.
- Fossil fuel workers and communities: The bill would invest roughly $120 billion over 10 years in economic development, infrastructure, environmental remediation, assistance to local and tribal governments, and wage replacement, health, retirement, and educational benefits for coal industry workers who lose their jobs.
- Assistance to states: The bill would fund $10 billion in annual block grants to states and tribes to defray expenses associated with climate change.
- Checks to low- and middle-income families: Consistent with the means testing thresholds established for pandemic relief checks in the American Rescue Plan, every eligible adult would receive $800/year and every eligible dependent $300/year, distributed in biennial installments.
Provisions #1 through #3 together would absorb around $500 billion over the law’s first decade, out of the total $4 trillion in revenue that CTC’s model indicates the Save Our Future Act will generate during that time. The difference between those figures — some $3.5 trillion total — pays for the dividend checks noted in provision #4.
The proposed allocation of the vast majority of revenues to the dividends presumably is what delivered support from Citizens Climate Lobby, the national grassroots organization that for the past decade has relentlessly pursued the idea of returning carbon-tax revenues as dividends to U.S. households. Provisions 1 through 3 clearly are designed to win backing for the bill from justice-oriented climate advocates.
Local Air Pollutants
Environmental justice is also evident in the bill’s novel proposal to charge for emissions of fine particulates ($38.90/lb), NOx ($6.30/lb) and SO2 ($18/lb), with those prices rising at the rate of inflation, from qualified “major sources” (a legal term defined at 42 U.S.C. 7661) located in or no more than a mile from an environmental justice community. Our preliminary calculations suggest that all fossil-fuel power stations 25 megawatts or larger, even those with modern combined-cycle technology burning methane gas, would meet the statutory criteria, provided they are sited directly proximate to a community of color.
Other large stationary polluters such as oil refineries, chemical plants and perhaps oil and gas extraction and processing facilities might also qualify. (We are awaiting details from Sen. Whitehouse’s office.) We estimate that coal-fired power plants would be charged for their “local” pollutants at a rate averaging around 5 cents per kWh generated, a fee that would effectively duplicate (i.e., double) the direct impact of the initial $49/ton carbon tax. Gas-fired power generators, in contrast, would pay only around 2/10 of a cent per kWh, on account of their sharply lower emission rates for conventional pollutants, relative to coal. (You can see our assumptions and calculations in the Local Pollutants tab of our carbon-tax model.)
Prospects aren’t bright for the Save Our Future Act in the current Congress. The persistence of the Senate filibuster means that 60 out of 100 senators must approve the bill; yet opposition is virtually guaranteed from almost all 50 Republican senators along with Sen. Joe Manchin (D-WV) and perhaps a few other Democratic senators. Not only that, the Biden White House is unlikely to put its muscle behind the bill, for reasons we laid out earlier this year in our post, Playing the Long Game for Carbon Fee-and-Dividend:
Razor-thin House and Senate margins simply don’t allow for hot-button measures like carbon pricing that might jeopardize other elements of the package in addition to failing on their own. Biden’s task, as he knows full well, is to pass bold, progressive, popular legislation to help Democrats expand their Congressional majorities in 2022 and 2024 and give him a thumping second-term mandate to boot. Then, and only then, can he risk a carbon tax.
Still, let’s credit the Save Our Future Act for pushing the envelope on carbon taxing on the twin key fronts of tax design and revenue treatment. Kudos to Senators Whitehouse and Schatz for seeking support from a diverse set of environmental and justice campaigners. The bill underscores the importance of solidifying a pro-climate Congress to enable such forward-thinking bills to be seriously considered during the second half of the Biden term.
We’ve just posted an update — the first in four years — to our carbon-tax spreadsheet model, CTC’s easy-to-use but powerful tool for forecasting future emissions and revenues from possible U.S. carbon taxes.
The model, which runs in Excel, accepts any carbon tax trajectory and spits out estimated sector-by-sector and economy-wide emission reductions, year by year.
The big new feature is explicit modeling of transportation’s conversion to electric propulsion. The model establishes baseline projections of electric power’s 2050 shares of car travel (60 percent), freight hauling (30 percent), and airplane seat miles (10 percent, probably by hydrogen, which, like battery power, will be produced by electricity); it then elevates these percentages in the case of robust carbon-taxing.
Our updated model also includes, as it must, the added electricity to power electric transport. This quantity is substantial, accounting for around 20 percent of all electricity usage by the 2045 end of the forecast period. Yet the resulting emissions never reach 100 million metric tons of CO2, on account of the rapid decarbonization of electricity production predicted in the model. (For comparison, note that total U.S. carbon dioxide emissions this year from burning fossil fuels are likely to be between 5,000 and 5,500 million metric tons.)
Without a tax on carbon emissions, however, electrified transport will add 200 million metric tons to annual U.S. emissions two decades from now — even though fewer cars, trucks and planes will be electric-powered, due to the absence of a carbon price signal. The higher level is because of the slower pace of decarbonization of electricity generation without a carbon tax.
A Carbon Tax Could Put Biden’s Ambitious 2030 Target Within Reach
At last month’s Earth Day climate summit, President Biden committed the United States to “a 50-52 percent reduction from 2005 levels in economy-wide net greenhouse gas pollution in 2030.” Since his target encompasses greenhouse gas pollutants like methane and chlorofluorocarbons and also appears to take credit for carbon sequestration in soils and forests, it’s possible that it assumes only a 40 percent reduction in fossil fuels’ CO2 along with very aggressive reductions in other areas.
A robust carbon tax could put a 40 percent CO2 reduction target nearly in reach. Our modeling suggests that with a carbon tax starting next year at $15 per ton of CO2 and rising by $10 a ton each year, U.S. 2030 carbon emissions from burning fossil fuels would be 36 percent less than in 2005. Without a carbon tax, the 2030 vs. 2005 reduction is limited to 14 percent — the same as in 2017. And while Biden’s laudable plans to ramp up energy efficiency and renewable electricity will cut emissions somewhat, raising the reduction figure to 20 percent is probably the limit to what the U.S. can accomplish by 2030 without a rapidly rising carbon tax.
How We Model Electrified Transport
Vehicle electrification is beginning to take off, propelled by improving battery performance, zero-emission-vehicle mandates in some states, and Biden administration plans to jump-start battery charging facilities across the country.
Like other innovative mass-market technologies — smartphones, VCR’s and microwave ovens come readily to mind — dissemination of EV’s is likely to follow an s-curve rather than a linear (straight) path. We use such a curve to represent the rate of uptake, with the halfway point assumed to be 2035.
As noted, we posit that even without a significant carbon price, electric or hydrogen propulsion will account for 60 percent of U.S. driving, 30 percent of goods movement and 10 percent of aviation by 2050. But a robust carbon tax will speed the transition, not just by widening electric vehicles’ per-mile price advantage over gasoline, diesel and jet fuels but by creating tipping points, e.g., accelerating the replacement of gas stations with charging stations. We assume that a robust price — $100 or higher (in 2020 dollars) by 2031 — will lift our 60/30/10 percentages by half, to 90/45/15.
The reductions in U.S. petroleum requirements predicted for that scenario by our model are striking. By the mid-2030s, when the penetration of electric transport is at its halfway point and kicking in fast, total oil consumption is projected to be nearly four million barrels a day (25 percent) less than in a business-as-usual, no-carbon-tax future, and nearly eight million barrels a day less than the actual 2005 rate.
Other Features of CTC’s Carbon Tax Model
Here are other defining features of our carbon-tax model:
1. It’s baselined to 2019: That’s the most recent year with available data. It’s also a more solid baseline year than 2020, when the pandemic drove down key fossil fuel use sectors, especially driving and flying.
2. Oil refining is allocated to usage sectors: “Upstream” carbon emissions from refining petroleum products are assigned to the respective end-use sectors such as driving, goods movement and aviation. The model doesn’t ignore analogous add-ons for electric transportation; we add 20 percent to the current watt-hours per mile figures for the respective travel modes to allow for electric-intensive battery manufacture.
3. We smooth the uptake of the carbon tax: Big jumps in carbon tax levels won’t be fully reflected in fossil fuel use right away. Households and businesses need time to adapt to costlier fossil fuels. The model captures these lags through a ceiling in the tax increment that can be “absorbed” in any one year and carries over any excess. This feature is helpful for trajectories like the Whitehouse-Schatz bill, which kicks off with a bang at $45 per metric ton of CO2. Under our default setting, in which the economy in any year is assumed able to process only tax increments up to $15 per ton of CO2, the reductions from that initial $45/ton charge are spread over three years rather than, unrealistically, assigned to the first year.
4. Demand vs. supply impacts: The Summary page has a section comparing projected CO2 reductions from changes in fuels’ carbon intensities (“supply side”) versus reductions from reduced energy usage (“demand side,” e.g., lower electricity purchases, less driving or flying). Under our default carbon tax — starting at $15 per ton of carbon dioxide and rising annually at $10/ton — an estimated 64% of projected CO2 reductions are on the supply side (i.e., due to decarbonization); a substantial minority, 36%, come about through reduced demand, illustrating that subsidies-only policies miss out on huge CO2 reductions. Indeed, clean-energy subsidies undercut decarbonization by stimulating energy usage through lowered energy prices, a phenomenon we noted in our 2014 comments to the Senate Finance Committee.
5. Transparency: All model assumptions, formulas and algorithms are in plain sight. This includes our price-elasticity assumptions that translate higher fossil fuel prices into lower demand trajectories, as well as the income-elasticities that predict more driving, flying, electricity usage and so forth as incomes rise. To be sure, some hunting may be required; the model has nearly 25,000 equations, after all. But the stepwise procedures we use to calculate year-to-year changes in each sector’s activity level, fuel use and emissions are all annotated, a mighty assist to anyone wishing to get deep into the model’s workings.
6. Easy to use: For example, we just read today’s WaPo op-ed, Biden should embrace a carbon tax, by veteran Washington and Wall Street insiders Henry Paulson and Erskine Bowles. Once we got past the political tone-deafness of urging a carbon tax now (“Biden’s task is to pass bold, progressive, popular legislation to help Democrats expand their Congressional majorities in 2022 and 2024 and give him a thumping second-term mandate to boot,” we wrote last month; “then, and only then, can he risk a carbon tax”), we saw Paulson and Bowles’ claim that a carbon tax starting at $40 per ton and increasing by 5 percent per year above the rate of inflation “would reduce U.S. emissions to 50 percent below 2005 levels by 2035.” It took only seconds to plug those figures into our model and see that in year 15, which would be 2036 or later, the tax would reduce emissions by only 39 percent. While that’s a big reduction, it’s still a ways below the council’s claimed 50 percent.
The spreadsheet is user-friendly, powerful and, if you’re so inclined, captivating. We hope you’ll download it — here’s the link again — and run it in Excel. See for yourself the relative efficacy of a carbon tax trajectory that increases by a fixed amount each year, as does the Energy Innovation and Carbon Dividend Act supported by Citizens Climate Lobby, vs. one like the Climate Leadership Council’s (touted by Paulson and Bowles) that starts high but rises only by moderate, percentage-driven amounts.
As you work (play?) with the model, jot down your thoughts so you can tell us what works and what needs improving. Especially the latter, as we just wrapped the update and there are bound to be glitches. We’d love to hear from you.
A striking — and troubling — shift of late in the climate-policy landscape is the pronounced turn against carbon pricing by the environmental- and climate-justice movement — the community of individuals and organizations dedicated to overturning deeply entrenched inequities of disproportionate pollution burdens borne by African-Americans, Latinos, Asians and Pacific Islanders and Native Americans in the United States.
Most in that movement now appear to disdain carbon pricing as a climate policy tool, whether as a straight-up carbon tax or a permit-based cap-and-trade system. This shift is a blow to carbon tax prospects, not least because the broader progressive community increasingly is taking its lead from Black, Brown and Indigenous people who traditionally were excluded from leadership in environmental issues. Growing antipathy by EJ/CJ campaigners is one of the reasons that progressives’ interest in carbon pricing has cooled in recent years. (See in-depth discussion on our complementary page, Progressives and Carbon Pricing.)
This page begins by inquiring into the sources of that antipathy. It then recapitulates two 2020 Carbon Tax Center posts reporting new research crediting carbon pricing for reducing disproportionate dumping of pollutants on disadvantaged communities in California. Environmental Justice, Borne Aloft by Carbon Pricing, was posted in Sept. 2020. A follow-on, Dogmatism on Carbon Pricing Mustn’t Derail Climate Progress, was published in Dec. 2020.
We then summarize another 2020 study that found that the Clean Air Act has sharply reduced environmental inequality between racial groups across the United States, even though its provisions and enforcement did not explicitly target communities of color.
This new research, while heartening, does not yet appear to have prompted reconsideration of carbon pricing or other “universal” environmental and climate policies by environmental justice advocates.
Wellsprings of EJ antipathy to carbon pricing
A decade or so ago, at the start of the 2010s, many EJ/CJ campaigners opposed carbon cap-and-trade programs but were agnostic about carbon taxes. By the end of that decade, most in the movement were aligning against carbon taxing as well. Some did so with increasing stridency, branding any carbon pricing as harmful, even “colonialist” (see photo).
The turn against carbon pricing by many environmental and climate advocates of color has multiple causes and antecedents, including:
- Belief that carbon pricing commodifies both nature and humans’ right to a safe environment and climate.
- Conflation of carbon pricing with predatory capitalism that, over centuries, brought prosperity to whites by stealing the land of Indigenous people and the labor of people of African descent.
- Fear that carbon pricing necessarily entails “offsets” that let polluters buy their way out of reducing local pollution.
- Conviction borne from an early and easily gamed pollution-pricing program — California’s RECLAIM cap-and-trade system to cut nitrogen oxides — that carbon pricing perpetuates pollution “hot spots” in disadvantaged communities.
- A preference for addressing the climate crisis by attacking entrenched power imbalances that skew against communities of color rather than through so-called “race-blind” policies that, at least on their face, appear to ratify those imbalances.
- The mistaken belief that California’s carbon cap-and-trade program is exacerbating long-standing pollution-exposure disparities between disadvantaged communities and whiter, affluent populations.
Further below, we unpack the sixth and final bullet — the deeply held but erroneous conviction that California’s permit-based carbon-pricing system is worsening the disproportionate pollution burden borne by low-income communities of color. It should be said, however, that it is the the cumulative power of the five other conditions that has given this misplaced conviction such great salience in the environmental justice movement — initially in California and now nationwide.
2015-2020: EJ criticism mounts against carbon pricing
We first wrote about environmental justice and carbon pricing in 2016, prompted by a column in Yale 360 by 350.org co-founder and prolific climate activist Bill McKibben. In Why We Need a Carbon Tax, And Why It Won’t Be Enough, McKibben wrote:
Carbon rebates also come with one obvious moral and intellectual flaw: most of the damage from both climate change and air pollution has fallen on poor people, people of color, and Native nations, both in our country and around our world. They need to be treated fairly in any rebate plan. And any such rebates shouldn’t overlook the estimated nearly 12 million undocumented Americans who contribute to the economy — and cause far less than their proportional share of emissions. Environmental justice would mean a truly “fair” system compensated them for that history; it would also require policies to make sure that carbon pricing doesn’t perpetuate toxic “hot spots” in poor communities as companies look for least-cost ways to deal with the new reality. Furthermore, environmental justice demands that carbon prices don’t create a windfall on other of forms of ecological or toxic energy production, such as mass incineration or mega-hydro dams. (emphasis added)
McKibben’s first charge to carbon-pricing proponents, that the necessarily higher prices of fossil fuels not disadvantage poor people and people of color, was one that CTC and other carbon-tax advocates had addressed for years (our Ensuring Equity page, has details). Our response to McKibben, published as Carbon Tax Can Be a Remedy for Toxic Hot Spots, summarized our antidotes to economic regressivity. We then turned to hot spots.
“From time to time,” we noted, “concern is voiced that polluting companies will respond to carbon taxes by curbing carbon pollution elsewhere rather than in frontline communities like blighted urban neighborhoods, Appalachian hollows, or Native peoples’ lands.” To head off those possibilities, we urged “members of frontline communities to assume leadership positions in the carbon tax effort.”
Hopes for that partnership soon dwindled, with publication by the Indigenous Environmental Network and the Climate Justice Alliance of “Carbon Pricing: A Critical Perspective for Community Resistance” in November 2017. The manifesto nature of this 60-page report was telegraphed by its boldface message on page 3: “This publication will help communities and organizations articulate crucial points to resist carbon pricing and carbon change.”
The paradigm of resistance to carbon pricing suffused the report’s five “main takeaways” (shown at left). Carbon pricing was deemed a “false solution” that “does not keep fossil fuels in the ground.” Rather than a climate-damage antidote or preventive, carbon pricing was, at best, merely “remedial.” Better to “fight fossil fuel subsidies” and “build power,” the report stated, than succumb to polluters’ carbon-pricing “greenwash.”
Then and now, CTC has no argument with the call for frontline and disadvantaged communities to build power. But build power toward what? If ending fossil fuel subsidies is part of the solution, it needs to be said that “fossil fuel subsidies” as commonly defined — taxpayer-funded payouts or tax breaks such as the oil-depletion allowance — are dwarfed in the United States and most other industrial countries by the climate and health damages from extracting and burning fossil fuels. Which means that the real fossil fuel subsidy, as we point out on our Subsidies Reform page, is the absence of carbon pricing.
The following September (2018) saw the “Solidarity to Solutions” action in San Francisco depicted in the earlier photograph. We reached out to one of the participants, just as we had, a year earlier, to one of the prime movers of the IEN/CJA manifesto. In both cases, our entreaties for dialogue were rebuffed. Tellingly, one party informed us, “We do not have the capacity for engaging deeply with individuals that are not rooted in an organization with accountability to a base of people — there may be other organizations who have that capacity, but we do not.”
An incomplete analysis of cap-and-trade hardens EJ opposition in California
Concurrently, in California, a research project examining the incidence of pollution from California’s carbon cap-and-trade law, AB 32, was adding to environmental justice campaigners’ antipathy to carbon pricing.
That project, by a team of academics led by Prof. Lara Cushing, published its findings in a 2018 paper in the journal PLOS Medicine Carbon trading, co-pollutants, and environmental equity: Evidence from California’s cap-and-trade program (2011–2015). However, the team’s preliminary findings had begun circulating as early as 2016, helping turn opinion against the cap-and-trade program in the EJ community and its allies.
The Cushing team concluded that, following implementation of the cap-and-trade program, a majority (52 percent) of California “regulated facilities” — the state’s roughly 300 largest “stationary” sources of carbon dioxide emissions — increased rather than curbed their emissions of greenhouse gases. Moreover, the increases in carbon co-pollutants such as particular matter and nitrogen oxides were disproportionately concentrated in communities with “higher proportions of people of color and poor, less educated, and linguistically isolated residents,” according to the PLOS paper.
These conclusions left an indelible imprint on discourse about carbon pricing and environmental justice. Yet they rested on shaky ground. The Cushing analysis had no control group, leading it to mistake the cap-and-trade program as the cause of rising emissions in disadvantaged communities when emissions actually increased across all of California as economic activity rebounded from the 2008-09 recession. It also assumed that smokestack emissions deposited within a few miles, ignoring wind patterns and tall smokestacks that sometimes dispersed pollutants far from frontline communities. Last, the analysis flattened the data into binary, “up or down” results, which inadvertently suppressed the tendency of bigger polluters to cut back the most as the cap-and-trade incentives kicked in.
2020: A pair of UCSB economists improve on, and reverse, that analysis
After reading elements of the work by Cushing et al., two economists at U-C Santa Barbara — PhD candidate Danae Hernandez-Cortes and Associate Prof. Kyle C. Meng — embarked on an ambitious research methodology that would improve on the Cushing work in three respects.
First, Hernandez-Cortes and Meng established a control group of 440 lesser California emitters that were not regulated by the cap-and-trade program; this “difference-in-difference research design” weeded out macroeconomic and other factors to discern the cap-and-trade program’s specific effects on emissions from the 306 larger, “covered” facilities.
Second, Hernandez-Cortes and Meng deployed an atmospheric transport model to track where the carbon co-pollutants actually deposit after they have been emitted.
Third, rather than assigning equal weight to the 300-plus facilities, the UCSB economists based their calculations on each facility’s emission quantity.
Hernandez-Cortes and Meng wrote up their work in a paper for the National Bureau of Economic Research, Do Environmental Market Cause Environmental Injustice? Evidence from California’s Carbon Market, first posted in May 2020 and revised in Feb. 2021. We’ve summarized their key findings in the table below.
The yellow columns display ground-level concentrations of particulate and gaseous carbon co-pollutants from California’s 306 largest carbon emitters in 2008. Perhaps even more striking than the “deltas” (numerical differences) between pollution concentrations in environmental justice vs. other communities are the ratios: pollution levels in the EJ communities in 2008 were three to four times as high as in other areas.
It’s apparent from the green column that by 2012 each pollutant’s “EJ gap” — the excess pollution deposited on disadvantaged communities relative to other California locales — had worsened even from its shocking 2008 base. Thereafter, however, coinciding with the onset of the cap-and-trade program, the gap narrowed significantly, as shown in the final two columns.
Consider the Hernandez-Cortes – Meng findings in the third row of the table for PM2.5. That’s the fine particulate matter that lodges deep in the lungs and is implicated in illness and death from heart and lung diseases and strokes and is considered the most deadly air pollutant associated with industrial processes that emit climate-damaging carbon dioxide. Beginning in 2013, the EJ gap for fine particulates contracted, falling to 2.7 µg/m3 in 2017 (the last year for which pollution data was available). That was 30 percent less than the 2012 gap of 3.8, and less than the baseline figure of 3.0 µg/m3 as well.
The state’s cap-and-trade program had a similarly beneficial impact on oxides of nitrogen, or NOx, which is the key constituent (along with volatile organic compounds) of the photochemical smog that since the late 1950s has infamously blanketed skies and seared eyes and lungs across much of California, with disadvantaged communities bearing more of the impact. As shown in the table’s top row, from 2012 to 2017 the EJ gap for NOx shrank to 4.8 µg/m3, a level 21 percent below the 2012 figure. Similarly, the environmental justice gap shrank during the same five years by 24 percent for sulfur oxides and 30 percent for larger particulate matter, known as PM10.
EJ antipathy to carbon pricing strikes down the top candidate to head the EPA
Neither the Hernandez-Cortes – Meng paper, which was posted in May 2020, nor our write-up of it in September drew much commentary. Neither piece broke into the mainstream press or even climate-journalism sites such as Inside Climate News or ClimateWire. The Hernandez-Cortes – Meng paper received two mentions in the green press, in October and November (our Dec. 2020 “Dogmatism” post has details); both were cursory and largely dismissive, owing either to the writers’ inexperience or their reticence to question environmental justice dogma.
That reticence would soon prove consequential. On Dec. 2, less than a month after Joe Biden’s victory over Donald Trump, 70 environmental justice and allied groups sent a strongly worded letter to the Biden-Harris transition team opposing the prospective nomination of Mary Nichols, long-time environmental attorney and regulator and chair of the California Air Resources Board, to head the US Environmental Protection Administration.
A principal charge in the letter, and the one singled out by the New York Times and in other media accounts, was the claim, based on the Cushing analysis, that the carbon cap-and-trade program overseen and administered by Nichols and CARB “perpetrated environmental racism [by] increas[ing] pollution hotspots for communities of color in California.”
Though the claim lacked merit — Hernandez-Cortes and Meng had reached the opposite conclusion in their work, after correcting critical weak spots in the Cushing analysis — it stirred up opposition that the new administration could not attempt to counter without incurring significant political costs, as the New York Times noted in an editorial, excerpted at left, that appeared on Dec. 28 — after selection of North Carolina environmental quality secretary Michael Regan to be EPA Administrator.
(The Wall Street Journal waited an additional three months before noting in a March 24, 2021 column that “A coalition of environmental groups [had] accused [CARB head Mary Nichols] her of ‘pushing market-based approaches to the climate crisis at the expense of the health and well-being of California’s communities of color.’ But empirical evidence suggests otherwise. California’s carbon market actually narrowed disparities in exposure to particulates, nitrogen oxides and sulfur oxides, according to a study by economists Danae Hernandez-Cortes and Kyle Meng of the University of California, Santa Barbara.” Our Dec. 2020 post, Dogmatism on Carbon Pricing Mustn’t Derail Climate Progress, has a detailed discussion of how opposition to Nichols was stoked by misinterpretation of the California cap-and-trade program.)
A separate analysis finds that the Clean Air Act’s “universal” policy approach has benefited EJ communities nationwide
In Jan. 2020, Princeton Prof. Janet Currie and two other academics published a paper, What Caused Racial Disparities in Particulate Exposure to Fall? New Evidence from the Clean Air Act and Satellite-Based Measures of Air Quality.
The paper takes as its premise the statistically demonstrated (and heartening) finding, stated in the abstract, that “Racial differences in exposure to ambient air pollution have declined significantly in the United States over the past 20 years.”
Applying what it calls “newly available, spatially continuous high resolution measures of ambient particulate pollution,” the Currie paper makes three revelatory findings about declining levels of fine particulates (PM2.5) in the United States from 2000 to 2015:
- Areas with larger black populations experienced greater declines in PM2.5 exposure.
- The black-white gap in mean pollution exposure to PM2.5 has decreased from 1.5µg/m3 (micrograms per cubic meter) in 2000 to only 0.5µg/m3 in 2015 — a two-thirds reduction.
- Over 60 percent of this “convergence” (reduction) in the black-white pollution gap is attributable to regulatory measures related to and required by the Clean Air Act.
The Currie paper concludes:
These findings suggest that the Clean Air Act has likely played a significant role in reducing the black-white gaps in exposure to air pollution, because the legislation systematically targeted the dirtiest areas for cleanup, and African Americans were disproportionately likely to live in areas with dirty air. Hence, although the Clean Air Act was not explicitly designed to address disparities in pollution exposure, the Clean Air Act has nonetheless contributed to reductions in environmental inequality between racial groups in the United States. (emphasis added)
The bolded passage signifies the enduring value of the “universalist” approach to pollution reduction embodied in the Clean Air Act and other foundational environmental legislation, circa 1970. Rather than prioritize one set of communities over another, the Clean Air Act was designed to mitigate environmental pollution and its effects on everyone, everywhere. And if communities of color were the furthest from those standards (which of course they were, overwhelmingly, on average), then the mandated improvements in those communities would have to be disproportionately large.
That is, although “early” environmental legislation, which was driven and to a great extent written by the environmental movement of that era (the late 1960s and early 1970s), was not framed in terms of differential pollution impacts between rich and poor or Black and white, it nonetheless has had the effect of reducing those differentials.
The Currie paper won’t be the last word on pollution differentials. It doesn’t address the pollution gap between white or Black populations and Hispanic/Asian/Native populations. Rapidly rising Hispanic and Asian-American populations, both nationwide and in California, e.g., in the heavily polluted and largely Hispanic San Joaquin Valley, make this an urgent research priority.
Nevertheless, the Currie paper is valuable in its own right and for the light it casts on another universal policy: carbon pricing. Provided that carbon pricing programs aren’t saddled with “offsets” or other invitations to game the system, they almost certainly bend toward reducing both absolute pollution levels and race-based pollution gaps — a point argued at length in our late-2020 posts (Sept. 2020 and Dec. 2020) already discussed here.
Further confirmation of the shrinking clean-air gap between Black and white Americans
A Sept 2021 Atlantic article, Why Americans Die So Much, reports newer research reinforcing Currie’s finding of disproportionately positive benefits to Black and other non-white Americans from U.S. “universal” environmental policies. Author Clive Thompson summarizes a new National Bureau of Economic Research working paper, Inequality In Mortality Between Black And White Americans By Age, Place, And Cause, And In Comparison To Europe, 1990-2018, written by a team led by Northwestern University professor Hannes Schwandt. Amid the bad news of falling U.S. life expectancy, the NBER paper includes what Thompson calls “a surprising success story in U.S. longevity”: a near-halving of the Black-white life-expectancy gap from 1990 to 2018, prior to the onset of the COVID-19 pandemic.
In the three decades before COVID-19, average life spans for Black Americans surged, in rich and poor areas and across all ages. As a result, the Black-white life-expectancy gap decreased by almost half, from seven years to 3.6 years. [One reason was] reductions in air pollution. “Black Americans have been more likely than white Americans to live in more-polluted areas,” Schwandt said. But air pollution has declined more than 70 percent since the 1970s, according to the EPA, and most of that decline happened during the 30-year period of this mortality research.
Note: This post has been updated from its original March 1 posting: new closing section, some “line edits,” new headline.
That was quite a feel-good story in Yale Environment 360 last week. The headline, On U.S. East Coast, Has Offshore Wind’s Moment Finally Arrived?, didn’t really rate a question mark, considering how the subhead brimmed with optimism:
After years of false starts, offshore wind is poised to take off along the East Coast. Commitments by states to purchase renewable power, support from the Biden administration, and billions in new investment are all contributing to the emergence of this fledgling industry.
About time. Early this century, I was an ardent proselytizer for wind power, “the only non-polluting means of generating energy that is commercially available on a large scale,” as I described it in an Appeal to the environmental community to support the Cape Wind project in Nantucket Sound in 2002.
Sadly, in one of the worst NIMBY flameouts ever, the 470-megawatt Cape Wind project was set upon by well-connected Cape Codders like the Kennedy family and Walter Cronkite, keeping it from fruition. and creating a playbook for wind foes everywhere. Even a proposal to repurpose a mine-damaged Adirondacks mountaintop with a mere half-dozen turbines proved no match for preservationists who prioritized their views over sustainability.
But wind power’s political travails did help kindle my interest in carbon taxing. “If carbon fuels were taxed for their damage to the climate,” I mused in a 2006 article in Orion magazine, “wind power’s profit margins would widen, and surrounding communities could extract bigger tax revenues from wind farms,” helping ease the path to public acceptance and regulatory approvals. A few months after writing that, I co-founded CTC.
Wind power today
Today, though fewer than ten wind turbines operate at just two offshore U.S. sites, tens of thousands of onshore turbines together are generating 8 percent of U.S. electricity (based on preliminary 2020 data). Percentage-wise, Iowa led all states with 42 percent of its electricity production coming from wind in 2019. Texas (yes, Texas) led in absolute megawatt-hours from wind last year with a whopping 93 million megawatt-hours, nearly 28 percent of the U.S. total.
Now, the Yale story reports, “New York, New Jersey, Virginia, Massachusetts, Connecticut, Rhode Island, and Maryland have together committed, through legislation or executive action, to buying about 30,000 megawatts (MW) of offshore electricity by 2035.”
A quarter of those megawatts, 7,500, would be located off New Jersey’s Atlantic coast, a goal that NJ Gov. Phil Murphy affirmed in a statement last September announcing the state’s Offshore Wind Strategic Plan.
What physical scale do those 7,500 megawatts constitute? Let’s use as our metric the new crop of super-giant turbines. According to the Yale story, Vestas, Orsted and General Electric are today selling wind machines in the 12-14 megawatt range — an impressive notion, considering that not long ago the 3.6-megawatt Cape Wind turbines were said to be pushing the envelope.
Let’s stipulate 12.5 megawatts, since 80 of them conveniently multiply to 1,000 MW. Meeting NJ Gov. Murphy’s 7,500 MW target would then entail erecting 600 of these super-giants off the state’s roughly 115-mile-long Atlantic coast.
If 600 huge windmills seem daunting, try multiplying the number by five. Yes, 3,000 mammoth turbines providing 37,000 MW from offshore wind is what could be required if New Jersey goes all-in for decarbonization over the next several decades, according to one energy vision that is a kind of apotheosis of the Green New Deal.
The idea of 100% Wind-Water-Sunlight
That vision is the all-renewables 100% wind-water-sunlight (“100% WWS”) conception propounded by Stanford physicist-engineer Mark Jacobson and colleagues, under the aegis of an NGO known as the Solutions Project.
The idea is for electricity to power all energy uses — not just lights and appliances and electronics but also cars, trucks, heat and industry. Even, eventually, aircraft, either through batteries or, more likely, hydrogen fuel manufactured by electrolyzing water. Electricity is both an efficient energy form for delivering “energy services” and the easiest to provide from all-zero-carbon sources: wind turbines, solar panels and other sunlight-based generation, and water power from rivers or tides.
The Jacobson et al. vision has been written about widely (here’s Jacobson’s 2014 TED talk; also see link to pdf paper at the end of this paragraph) and need not be rehashed here. We use it here as a benchmark. References are to the detailed 2015 paper by Mark Z. Jacobson et al., “100% clean and renewable wind, water, and sunlight (WWS) all-sector energy roadmaps for the 50 United States,” Energy Environ. Sci., 2015, 8, 2093 (14 MB pdf).
By The Numbers: New Jersey Offshore Wind in an All-Renewables Scenario (without a Carbon Tax)
- 32,900 MW — New Jersey’s total 2050 “end-use energy load” under 100% WWS, expressed as megawatts operating continuously all year. From Table 1 of the Jacobson paper.
- 288,204,000 MWh — New Jersey’s total 2050 “end-use energy load” under 100% WWS, in megawatt-hours. Calculated by multiplying the preceding MW figure by the number of hours in a year (8,760).
- 55.5% — Share of New Jersey’s electricity to be provided by offshore wind, from Jacobson’s Table 3. Another 10% is assumed to come from onshore wind, for a total NJ wind percentage of 65.5%, which is consistent with Jacobson’s U.S. total of 50% (31% onshore, 19% offshore), considering the state’s small land area relative to its coastline. (Another 27.25% of the needed electricity in the 100%WWS scenario would be generated by utility-owned-and-managed photovoltaic arrays, with another roughly 3% each from PV installations on residential and commercial buildings.)
- 160,000,000 MWh — New Jersey’s 2050 electricity to be provided by offshore wind. Calculated by multiplying the #2 and #3 figures above.
- 50% — assumed capacity factor of the offshore wind turbines. That’s more than the 42.5% in the Jacobsen paper (Table 2, FN), but less than the 60-64% that General Electric optimistically touts for its 12-14 MW turbines.
- 54,750 MWh — annual electricity from each 12.5-MW offshore turbine. Calculated by multiplying 12.5 MW figure by the number of hours in a year.
- The result: 3,000 offshore wind turbines — calculated by dividing the #4 figure by the #6 figure. (The calculation yields 2,920, which we round to 3,000.)
Can this be done? Can New Jersey install (or, more precisely, organize and govern the installation of) 3,000 giant offshore wind turbines?
A robust carbon tax would let NJ dispense with 35-40% of the offshore turbines
When we posted this blog on March 1, we promised to estimate how much a robust carbon tax could trim the need for New Jersey offshore wind by trimming energy demand.
We’ve now (March 12) done the calculation: it appears that a carbon tax starting at $15 per ton of CO2 and incrementing annually (and indefinitely) by that amount would achieve roughly five-eighths (63%) of its carbon reductions through fuel-switching, i.e., by swapping out fossil fuels in favor of renewables — wind turbines, solar panels, etc. The other three-eighths (37%) of the carbon reductions would come from reducing energy demand as a result of energy being made more expensive relative to other goods and services.
The latter figure — the 35 to 40 percent reduction — means that New Jerseyans could achieve 100% wind-water-sunlight energy provision with 35-40 percent cuts across the board in the amounts of wind, solar and water power that the Jacobson scenario would otherwise entail. The requirement to build 3,000 giant offshore wind turbines would become “just” 1,800 to 1,900.
April 10 postscript: What do we mean by “monster” wind turbines?
Friend of CTC Peter Jacobsen (no relation to Mark Jacobson; different spelling, in fact) tipped us off yesterday to the size matchup between what the New York Times recently called GE’s new “monster” wind turbines and the smokestacks of what was the largest U.S. coal-fired power plant until its closure in 2019 and demolition last year, the Navajo Generating Station in northern Arizona, near Lake Powell.
Some folks view giant smokestacks and giant turbines as pretty much the same. Two decades ago, a newspaper story about a proposed wind farm outside Cooperstown, NY, near the Finger Lakes, closed with a quote from a Manhattan television executive who was retiring to a hilltop home in the area: “I think the towers would make my property worthless,” he said. “To see these giant towers near your house — it would be like driving through oil derricks to get to your front door.”
A few years later, I toured a nearby wind farm while researching an essay on wind power for Orion magazine. “To my eye,” I wrote, “the wind turbines were anti-derricks, oil rigs running in reverse. The windmills I saw in upstate New York signified, for me, not just displacement of destructive fossil fuels, but acceptance of the conditions of inhabiting the Earth.”
To perform calculation: Download CTC’s carbon-tax spreadsheet model (xls). Stay within the first “tab,” Inputs-Summary. In Col. I, make sure Rows 19, 22 and 27 are set to $15.00 and Row 21 is set to Linear. The 37% result may be found in Cell G224. We hope to update the model’s 2017 parameters to 2019 (pre-pandemic) levels by the end of May.