Mathew Carr, Tino Andresen and Brian Parkin, Bloomberg News, February 19, 2017

• Ensuring that losers are compensated is seen making politics easier
• Volume of RWE’s German lignite power output seen plunging 58 percent

Driving most of Europe’s dirtiest power plants into retirement is probably cheaper than you think.

Companies from German utility EON SE to Sweden’s Vattenfall AB are calling for measures including a minimum price on pollution rights to kickstart the European Union’s sputtering carbon market. Such a levy would effectively force all but the most efficient coal plants to close.

“Installing a carbon floor price would be the most cost-efficient solution” to avoiding the worst of climate change, said Johannes Teyssen, chief executive officer of EON, which last year spun off its fossil-fuel plants. “A well and efficiently functioning emissions-trading system could, in fact, restore Europe’s reputation as a leader on climate policy,” he said by e-mail.

EU efforts to reform its $48 billion cap-and-trade system have repeatedly failed to boost the cost of polluting and encourage green investment. While Britain operates a national floor price and France has proposed a regional levy, opposition remains intense.

Coal-dependent nations, including Poland, argue that the higher costs will hurt their economies and EU Climate and Energy Commissioner Miguel Arias Canete has said such a move could damage manufacturing in the region.

A price floor of 30 euros ($32) per ton of carbon dioxide, or six times the current permit rate, would only cost each European citizen about 5 euros a year through 2025, according to the Institute of Energy Economics, or EWI, in Cologne, Germany. That’s the same as a beer in the Wild Geese pub down the street from the European Commission’s headquarters in Brussels.

While the regulator of the 12-year-old market remains committed to no price floors or ceilings, such intervention is gaining traction outside Europe. Canada plans to install minimum carbon prices beginning in 2018 to discourage fossil fuels and raise revenue. And on Feb. 8, a group of U.S. Republicans and business leaders including former Treasury Secretary Hank Paulson pressed the case for a carbon tax to top White House aides.

Photo: Glasses of Little Creatures beer in the canteen of the company’s craft brewery, operated by Kirin Holdings

Source: https://www.bloomberg.com/news/articles/2017-02-20/how-eu-can-limit-coal-s-life-for-the-cost-of-a-pint-of-beer

Read More: https://www.bloomberg.com/quicktake/carbon-markets-2-0

By THE EDITORIAL BOARD, New York Times, February 13, 2017

The most important thing about a carbon tax plan proposed last week may be the people behind it: prominent Republicans like James Baker III, George Shultz and Henry Paulson Jr. Their endorsement of the idea, variations of which have been suggested before, may be a breakthrough for a party that has closed its eyes to the perils of man-made climate change and done everything in its power to thwart efforts to reduce greenhouse gas emissions.

This gang of Republican elder statesmen — they call themselves the Climate Leadership Council — is not made up of the usual environmentalists, which is why their proposal might gain traction, though probably not right away.

Their proposal would tax carbon emissions at $40 a ton to start and would be paid by oil refineries and other fossil fuel companies that would pass costs on to consumers with higher gas and electricity prices. The money raised would be returned to Americans through dividend checks; a family of four would get about $2,000 a year to start. This would help people adjust to higher energy prices and give them an incentive to reduce consumption or switch to renewable sources of energy. Most lower-income and middle-class families would get back more than they pay in taxes. To avoid placing American industry at a disadvantage, imports from countries that do not impose a comparable tax would be subject to a per-ton tax on the carbon emitted in the production of their products, while exports to those nations would not be.

Scientists and economists have long argued that putting a price on carbon would encourage conservation and investment in renewable energy. Ireland, Sweden and British Columbia already have carbon taxes. The European Union, Quebec, California and Northeastern states like New York and Massachusetts have adopted cap-and-trade systems that use emission permits to lower emissions over time.

The last serious effort to impose a national price on carbon came in 2009 with cap-and-trade legislation by Edward Markey and Henry Waxman, both then Democratic House members. The bill passed the House, but never received a vote in the Senate. Since then, Republican control of one or both houses of Congress has thwarted ambitious climate legislation. As a result, President Obama turned to administrative actions to reduce emissions, including the Clean Power Plan and higher fuel-economy standards for cars and trucks. Those regulations and standards are now on the chopping block under the Trump administration.

The new Climate Leadership Council argues that conservatives should support a carbon tax because it is a more market-friendly approach than Mr. Obama’s regulations. And after a carbon tax is put in place, the council says, the government should eliminate most of those rules, since they won’t be needed. But there are legitimate fears that the tax alone might not achieve emission reductions on the scale needed to save the planet from out-of-control warming, and that regulations and other policies like public investments in renewable energy will be needed, too.

Neither President Trump nor Republicans in Congress have embraced the proposal. Many conservatives believe they’ll be able to dismantle Mr. Obama’s regulations through administrative, legal or legislative maneuvers, without compromising. Plus, many are philosophically opposed to, and politically fearful of, any new taxes.

Their dismissal of the council’s proposal is myopic and puts their party out of step with the country. A large majority of Americans want the government to address climate change — 78 percent of registered voters support taxing emissions, regulating them or doing both, according to a Yale survey conducted after the election. The Republican elders are offering their party an opening to change the conversation. It should take the cue.

Source: https://www.nytimes.com/2017/02/13/opinion/a-rare-republican-call-to-climate-action.html?action=click&contentCollection=U.S.&module=Trending&version=Full&region=Marginalia&pgtype=article