Carbon Pricing to promote Public Goods

Carbon Pricing for Public GoodsGeneva, January 25. By Adam Koniuszewski, GCSP Fellow

The Cost of Carbon Pollution

The enormous economic, social and environmental costs of climate change have been widely recognized since Nicholas Stern worked on quantifying them a decade ago. These costs however remain largely unaccounted for in the marketplace. This failure to apply the polluter pays principle distorts prices, encourages carbon pollution, and gives fossil fuels a competitive price advantage over cleaner alternatives.

Pricing Carbon

A number of nations, including Scandinavian countries, Switzerland and Italy, are trying to correct market signals by pricing carbon. In 2016, carbon pricing covered 13% of global emissions; a number that is expected to reach 50% of emissions by 2030. Carbon pricing, in the form of a tax or carbon trading, generated $50 billion in government revenues in 2015.

A “Framework Convention for Carbon Control” 

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The author suggests that carbon pricing experiences have produced valuable lessons for more governments to adopt it. In fact, there is now a compelling case for creating a “Framework Convention on Carbon Control” (FCCC) and an independent agency to oversee all aspects of carbon emissions and sequestration. Inspired by the successes of the “Framework Convention for Tobacco Control” (FCTC) in alleviating the smoking epidemic, the carbon control convention would be designed to fix market failures and insufficiencies that create de facto subsidies for carbon pollution.

The author also suggests that by ending fossil subsidies and implementing carbon pricing, nations can generate a revenue base that could be used to reduce corporate and personal income taxes. In addition to supporting national priorities like health and education, carbon finance can also fund the universal goals represented by 2030 sustainable development agenda.

For more see:  Winning the Tax Wars – Tax Competition and Cooperation 

Published by Wolters Kluwer, Jan 2018 (see chapter 9)

About “Winning the Tax Wars”

Tax Wars Book FlyerThe book is the outcome of the 2016 TaxCOOP conference at the World Bank in Washington DC on the impacts / solutions to international tax competition. It covers transfer pricing / profit allocation between tax jurisdictions, the need for compliance, investigations and protecting whistleblowers, wealth taxation in an increasingly unequal world, derivatives and hedge-funds, tax investigations, electronic commerce and crypto-currencies, and sin taxes. Its authors, editors and experts include: Brigitte Alepin, Blanca Moreno-Dodson, Louise Otis, Allison Christians, Vanessa Houlder, Lyne Latulippe, Patricio V. Marquez, Richard Murphy, Erika Siu, Eric M. Zolt and Adam Koniuszewski.

About TaxCOOP

TaxCOOP is an international independent and nonpartisan conference on tax competition and the weaknesses of the current tax system in the era of globalisation. Thanks to its various initiatives, TaxCOOP is now recognised as one of the most influential tax initiatives globally.

 

Winning the Tax Wars

I authored the chapter on Carbon Pricing in this new and most timely book on global tax competition: Winning the Tax Wars:

Tax Wars Book Flyer

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The book, resulting from a TaxCOOP Conference at the World Bank in Washington DC in 2016, covers how tax competition has evolved and its impact on developed and developing countries, the state of play when it comes to multinationals and transfer pricing / profit allocation between tax jurisdictions, the need for compliance, investigations and protecting whistleblowers, the need for a wealth tax in an increasingly unequal world, and, tobacco taxation.

A full chapter is devoted to promoting public goods and addressing climate change through carbon pricing along with recommendations to solve the growing crisis of tax competition represents my contribution to this important and authoritative work.

For more about Taxing Wealth by Richard Murphy check here.

The last TaxCOOP Conference took place at the United Nations Office at Geneva on October 16, 2017.

 

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Thanks to such initiatives, TaxCOOP has become the only conference in the  top 50 most influential on the global tax scene.

TaxCOOP Top50

More on this soon.

 

 

Reinventing Energy Services with Scott Foster

What would we do without energy? from smartphones to transportation our way of life runs on energy. But faced with the realities of climate change and 1.3 billion who lack access to modern energy, Scott Foster from the UN Economic Commission for Europe (UNECE) argues that we have got the energy equation seriously wrong and need to change the way we think about energy.

Energy as a Service

We can meet the challenges of sustainable development and climate change if we think of energy as a service instead of a commodity. Scott argues that we want hot showers and cold beers not barrels of oil or kilowatt-hours of electricity. Fostering this revolution to think in terms of services and obtaining this value most efficiently will radically reduce waste, improve efficiency and help address climate change and energy poverty.     hot shower cold beer

Transforming Energy Utilities

There is a compelling business case for transforming energy utilities into service providers because they have the financial capacity, the expertise and the business partners to make it happen. Most importantly, we know it works! The successful experience of California where it was  implemented after the oil crisis in 1978 for gas and 1982 for electricity shows has been replicated in 15 other American states for electricity and 23 for gas, with legislation pending for 12 other states.

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Incentives for the market to work

The winning formula is to share part of the savings between the end users and the utility so that the energy provider works for its customers to lower energy consumption and reduce energy bills. Sharing savings turns out to be more profitable then selling more energy which aligns the interests of all parties in a win-win relationship. A far cry from the traditional model of selling ever more energy that has fostered massive investment in efficiency, renewables and innovation while creating jobs, growing the economy with the added benefits of lower carbon and environmental and footprints. It is high time we put this experience to test in Europe other parts of the world…

 

Powering Forward, by Bill Ritter, JR.

PoweringForwardAs “Powering Forward: What Every American Should Know about the Energy Revolution” becomes available for sale today, I am grateful to Bill Ritter, his team at the “Center for the New Energy Economy” (CNEE) at Colorado State University and to Fulcrum Books for providing a copy of the book for this review.

Bill Ritter Jr. knows a thing or two about the energy revolution and the sun that is setting on the fossil fuel industry. As Governor of Colorado, he turned the State into a leader in clean energy and then launched the “Center for the New Energy Economy” (CNEE) to help other states accelerate their transition to a clean-energy future.

Having hosted Gov. Ritter at the Geneva “Green and Inclusive Economy” Conference ahead of the Paris climate summit, I was familiar with his work as governor and at the CNEE including the need to address climate change, the cost of clean versus fossil energy and green jobs. All are well covered, as one would expect in such a book. But “Powering Forward” is different in that it goes much further to address the role of science and education, the need for well informed citizens for a functioning democracy and how biased and misleading media coverage has helped the climate denial industry. But his most important contribution is to shed some light on the government intervention versus the free-market myth and his attempt to turn a divisive energy debate into a consensual and bi-partisan quest for a better future.

The Myth of the Invisible Hand

For many, government intervention amounts to “corporate welfare” and invariably drives up costs for consumers. It may therefore come as a surprise that fossil fuels have been subsidized since 1916 and that American energy utilities have been run as quasi monopolies with no competition. While most will agree that governments should not pick winners or losers, thinking that energy markets are “free” is a misinformed illusion. The reality is that government still largely favours fossil fuels with obsolete policies from the carbon age that are slowing down innovation, artificially restricting consumer choice and undermining American energy security.

The Tea Party Turns Green in Georgia

A good example comes from Georgia where the Sierra Club and the local Tea Party took on the monopolistic energy structure. It did not sit well with them that people could not choose where they get their electricity from and they forced a change in law to allow customers the ability to generate their own electricity and sell it back to the grid.

Consensual and Bi-Partisan

Business as usual is no longer an option. We are at the crossroad and must now decide if we will become the victims of our future or its architects. By working together and reconciling our differences we can turn scarcity into abundance and crisis into opportunity. This is the key contribution of Powering Forward.

Powering Forward Energy Facts: 

– Scientists understood the link between CO2 and the greenhouse effect in the late 1800s

– Lyndon Johnson is the first US president to raise the climate alert in 1965

– In 2006, Colorado College warned there would be no more skiing in the state by 2050

– On windy days 60% of the electricity in Colorado comes from wind

– At $25 per megawatt hour, wind power is over 20% cheaper then natural gas

Centralized power wastes up to 2/3 of the primary energy put into the system

Americans prefer energy conservation to energy production

– 87% of Americans think the US government should act about climate change

– The US Department of Defense sees climate change as a threat multiplier

– The IMF estimates fossil fuel subsidies at nearly $2 trillion including external costs. Most of the income is received by the wealthiest according to the IEA

US fossil subsidies amount to $2,180 for each man, woman and child annually

– The true cost of coal-fired power amounts to some $0.27/kWh

6 of the top 10 solar manufacturers are Chinese

9 of the top 10 wind manufacturers are non-US

Warren Buffet is buying solar power for $0.038/kWh (the avg. price paid by US households is close to $0.12/kWh)

– Arizona’s energy utility installs free solar panels and pays its customers $30/ month for 20 years to feed power into the grid

COP21 – The birth of humanity

IMG_0188Here are some thoughts from Jean-Louis Servan-Schreiber, journalist, writer and Vice Chairperson of the Human Rights Watch board, on the historical climate agreement announced on December 12 at Le Bourget in Paris. I was honored to join Jean-Louis and Corinne Lepage to speak at the Conference on Youth (COY) that preceded the climate talks to present the Declaration of Rights of Humankind and its importance to youth and future generations. FRENCH VERSION

COP21 – The birth of humanity

The memory of the media will keep this joyful scene at Le Bourget when the announcement of the agreement at the COP21 was made. Since then, objections, criticism and analysis of its shortcomings abound. They were inevitable and many are warranted.

But the most important when it comes to the future of humanity could not be rational. The collective emotion, even fleeting, gave the world images of what has inspired us to come together. In this digital era, we will see these images again and again, so as no to forget that what unites us is ultimately more powerful then what divides us.

To meet this challenge, a snap of fingers will not be sufficient. It will take decades of effort by activists, governments, scientists, associations, artists and others. But most of all, it will be for each new generation to discover the world in which it lives.

This moment of unanimity gave existence to humanity, beyond nations, beliefs or interests. We felt for a few minutes how this little flame, nascent, fragile, still wavering, was for us and our children so infinitely precious.

The emotion of this final between negotiators exhausted and radiant is already listed heritage. 

Jean-Louis Servan-Schreiber

 

 

COP21 – La naissance de l’humanité

IMG_0188

Voici quelques réflexions de Jean-Louis Servan-Schreiber, journaliste, écrivain et membre du conseil d’administration de Human Rights Watch, sur l’accord sur le climat annoncé le 12 Décembre au Bourget à Paris. Avec Jean-Louis et Corinne Lepage nous avons présenté la Déclaration des droits de l’Humanité durant la Conférence sur la Jeunesse (Conference on Youth – COY) qui a précédé les négociations sur le climat. ENGLISH VERSION

COP21 – La naissance de l’humanité

La mémoire des médias gardera cette scène de liesse au Bourget dès l’annonce de l’accord climatique à la COP21. Depuis les objections, critiques et analyses de ses insuffisances ne manquent pas. Elles étaient inévitables et beaucoup sont fondées.

Mais le plus important quand il s’agit de l’avenir de l’humanité ne pouvait pas être que rationnel. L’émotion collective, même fugace a offert au monde, les images de ce qui nous rend tous solidaires. Grâce au numérique, nous les reverrons encore et encore, pour que personne ne puisse oublier que ce qui nous lie est plus impératif que ce qui nous divise.

Pour transformer cet essai, il ne suffira pas, comme au rugby d’un coup de pied magique. Il faudra, des décennies durant, les efforts des militants, des gouvernants, des savants, des associations, des artistes. Mais, plus que tout de chaque nouvelle génération découvrant le monde dans lequel elle va devoir vivre.

Ce moment d’unanimité a donné existence à l’humanité, au-delà des nations, des croyances, des intérêts. On a senti, pendant quelques minutes combien cette petite flamme naissante, fragile, encore vacillante, nous était pour nous et nos enfants si infiniment précieuse.

L’émotion de ce final entre négociateurs épuisés et rayonnants s’est déjà inscrite patrimoine de l’humanité.

Jean-Louis Servan-Schreiber

Smartphones explode power bills!

I was intrigued yesterday morning when I heard the Virgin Radio (France) host saying that mobile owners pay €70 a month to power their smartphones, ipods, tablets and laptops. It turns out this number relates to the annual cost but the point is no less alarming. The average household spends around €1,400/year on energy of which some €900 relate to electricity. According to the French Environment and Energy Management Agency (ADEME), 14% of this electricity relates to recharging phones and other devices – a very high figure which exceeds even the share of lighting that comes to 12%.

Smartphone

The agency warns that most of this power is wasted when the phone is left to charge overnight, even when it is turned off. The residual power that is wasted when devices are plugged in represents a pure waste equivalent to two nuclear power plants operating permanently at full capacity and a cost of €2 billion.

Imagine what could be achieved if such funds were invested into speeding the transition to a clean energy future.

Some smart ideas:

  • Most phones can be charged in two hours – leaving them to charge overnight is costly and wasteful.
  • Get an external battery to provide more autonomy when needed.
  • Go for a solar or wind powered charger!
  • Charge your phone as you ride – Check out CITYCYCLE.COM at LINK for great Christmas ideas for your favorite cyclist!soporte-finn-de-bike-city-guide1