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A Bitcoin Mining Exposé Strengthens the Case for a Carbon Tax

April 20, 2023 By Charles Komanoff

The Nation magazine this morning published my essay, A Bitcoin Mining Exposé Strengthens the Case for a Carbon Tax. I’ve cross-posted it here to allow comments and add tables and graphics.

— C.K., April 20, 2023

Clean electricity, the backbone of the Biden administration’s strategy for slashing carbon emissions, is becoming daunting to expand.

US wind farms, which last year generated more electricity than all hydropower and solar panels in the 50 states combined, often face years of contention. The entire mid-Atlantic offshore region, an area brimming with wind potential, could be proscribed by Pentagon fretting over interferences with aircraft deployment, Bloomberg News disclosed this week.

But if red tape for green power is a bother, why not get the benefits with none of the fuss? Send commando teams to the 34 large-scale Bitcoin mining sites in the United States that were identified in a New York Times front-page exposé this month. In synchrony, have them sever the facilities’ power cables, which combined demand some 3,900 megawatts of electricity—nearly as much as 3 million households combined.

In a flash, legions of electricity-gulping, combination-seeking computers in Texas, New York, and 13 other states would cease whirring. Like a power surge but in reverse, the fossil-fuel generators energizing so-called cryptocurrency mining—literally, trillions of combination-seeking calculations every second—would dial down. The corresponding drop in carbon emissions would be the same as if thousands of new industrial-size wind turbines could be instantly erected and connected to grids, supplanting electricity now furnished by burning coal and methane gas.

Data adapted from NY Times April 9, 2023 story. Link in text above. FF% is estimated percent of *incremental* power demand supplied from coal or methane gas.

Fanciful? Consider the numbers. The Times helpfully enumerated each Bitcoin mine’s fossil-fueled draw on state and regional power grids along with the associated carbon emissions. It took only a few further steps for me to translate those emissions into generic megawatts of clean power that would defray them. Using today’s customary 300-foot-tall, 3.6-megawatt wind machines as my standard, I calculated a staggering 3,700 turbines.

There you have it: The US Bitcoin industry is single-handedly neutering the entire climate benefit from nearly 10 percent of US wind energy. That’s more electricity than is generated with wind in any single state, save Texas and Iowa.

This raises two uncomfortable questions for the climate movement: Why isn’t it rallying against Bitcoin mines and other parasitic users of carbon fuels? And why isn’t it taking the obvious step of calling for a tax on carbon emissions to reduce those usages while simultaneously extracting revenues from them?

Second question first. Generating the electricity consumed by those 34 Bitcoin mines causes 16.4 million tons of carbon dioxide emissions each year, according to the Times. If the United States had a $100 per ton carbon tax—the current price of carbon emission permits in the European Union’s cap-and-trade system—the carbon levies at the mine mouth and wellhead would be extracting $1.5 billion a year from the fossil fuel companies that power the Bitcoin operations, and depositing it into the Treasury.

To be sure, that money would only fund a mere 2.4 hours of federal spending a year—barely a single baseball game’s worth, under the new hurry-up-and-pitch rules. On the other hand, the tax moneys are twice what Fox News will pay Dominion Voting Systems under the settlement reached this week. And they’re recurring.

But it would not be extinguished. That’s where the climate movement comes in.

Had the tax been in place a decade ago, as I and others urged, the extra expense might have stopped some cyber-currency ventures from the git-go. But if it were put into place today, a robust carbon tax could at least impel Bitcoin miners to economize on electricity, charge more for transactions, or actually contract with greener power providers rather than merely pretending to, as the Times found.

Although no one can pinpoint precisely how a carbon tax would shrink Bitcoin mining’s carbon footprint, let alone any single sector’s, abundant empirical evidence suggests that total US carbon emissions would be around a third less with a triple-digit national carbon tax than without. Bitcoin would not be exempt.

The movement has targeted banks and pipelines for more than a decade, with not much to show in the way of lesser carbon emissions. Why isn’t it disrupting Bitcoin mining and other bloodsucking machines—helicopters, private jets, yachts, super-sized SUVs—that feed on fossil fuels and are predominantly playthings of plutocrats? Why isn’t it going all out to stop highway expansions and eliminate restrictive zoning that lock in energy waste for generations?

Yes, climate activists stopped Keystone XL. They won a ban on fracking in New York. They’re fighting to drive oil drilling out of Los Angeles. Valiant, heroic work. But these and other keep-it-in-the-ground victories are creating little climate benefit. Why? Because the same underlying demand, largely unaffected by those protests, is met by supplies from elsewhere.

The bank protests seem even less focused. Conoco doesn’t need financing from JPMorgan Chase or Wells Fargo to drill in the National Petroleum Reserve in Alaska. The only “bank” it requires is the collective fuel tanks of America’s 280 million motor vehicles, plus aircraft, off-road vehicles, and pleasure boats.

Marching on Citibank does send a message, and activating seniors who might otherwise sit at home posting about their grandkids is soul-stirring. But if divestment and bank-shaming were going to slow the assault on climate, we would have seen bigger results by now.

“If the world wants to limit warming,” Norwegian energy researcher Espen Erlingsen told the Times this month, “it will have to limit demand for oil and gas because [the] industry can deliver this kind of volume for many more decades.”

Amen. The climate movement’s strategy isn’t working. Trying to bottle up supply instead of throttling demand is whack-a-mole without end, chasing after but never stopping capitalism’s dynamism from erupting in crypto mining and 1,001 other climate-destroying products and technologies.

By itself, a carbon tax won’t cure that. But it would at least start to steer innovation and cultural norms away from endless new climate horrors.

As Philip Roth’s Mickey Sabbath might have said: Either tax carbon or bring on the commandos.

Addendum: My concluding sentence — perhaps too subtle a literary reference — is elucidated in Brian A. Oard’s delightful Mindful Pleasures website. Please note that the ultimatum was uttered not by Sabbath but by his lover, Drenka. — C.K.

Climate Sound and Fury, Signifying What, Exactly?

March 30, 2023 By Charles Komanoff

(This post was amended on March 31 to include rebuttals of our criticism of the Montana climate-change lawsuit from two distinguished participants.)

Climate agitation was much in the news last week. The Guardian reported on a forthcoming Harvard Environmental Law Review paper suggesting that fossil fuel companies could be held liable for homicide from deaths caused by climate change. A New York Times front-page story previewed a courtroom trial to determine if Montana policies promoting fossil fuels violate that state’s constitutional protections of a healthful environment. And in dozens of cities, activists assembled by noted climate author-organizer Bill McKibben tore up their Chase, Citi, Wells Fargo and Bank of America credit cards to spotlight the big banks’ financing of $1 trillion in fossil fuel projects over the past five years.

In other climate news, however, suburban legislators are contesting a bold initiative from New York Gov. Kathy Hochul to compel New York City and surrounding counties to expand housing supply. New York City’s public transit provider is scrounging for revenues to shore up declining subway and bus farebox receipts stemming from the triple-whammy of residual Covid worries, violent-crime fears, and working-from-home. Around the country, meanwhile, just about all of the gargantuan road-widening projects listed in U.S. PIRG’s most recent Highway Boondoggles report are proceeding apace.

“States’ rights” have become “local control.” L: Wallace for President rally, 1972, courtesy Google Images. R: Ryan Lowry for the NY Times, accompanying March 22, 2023 opinion essay, “NIMBYs Threaten a Plan to Build More Suburban Housing,” by Times editorial writer Mara Gay. Photo was captioned, “Legislators protested Gov. Kathy Hochul’s housing plan in Albany on Monday.” Faces and demographics in the two photos, taken more than half-a-century apart, are hard to distinguish.

Yes, we’re juxtaposing.

The three just-noted happenings threaten to lock in place profligate fossil fuel consumption and associated carbon emissions. Highway widenings engender more driving (“induced demand,” it’s called). Fare hikes and service cuts to transit in NYC and elsewhere will do the same. And bottling up housing supply, as New York’s suburbs and my own borough of Manhattan, along with affluent cities and towns all over the U.S. have been doing for decades, guarantees urban stasis and its evil twin of exurban sprawl, with its accoutrements of carbon-spewing SUV’s, manses and subdivisions — not to mention segregation.

Litigating for Climate

These carbon accelerants might be more bearable if the climate agitation mentioned at the top had genuine prospects for cutting emissions. Do they? Not likely.

Indicting, much less convicting, officers of fossil fuel companies for killing people via their emissions-induced climate change is the definition of quixotic — to my untutored eye, anyway. In court, Big Oil will simply point to the tens of billions of lives uplifted by the fruits of their fuels. And they won’t be spouting nonsense. The raising up of most of humankind out of subsistence, and the resulting cradle-to-grave lengthening of human lifespans, could not have happened without the carbon-fueled Industrial Revolution. Set against those numbers, the millions — if that — of lives provably lost because of climate change will appear as a mere rounding error.

To be sure, the still-rising use of fossil fuels globally has now burst past the point of positive net benefits, especially with the advent, at last, of scalable non-carbon ways to power civilization. But actually effectuating the transition seems a matter for politics, with or without judicial support.

And even if some clarion guilty verdict were rendered in some court, what would be the remedy? Would the fossil fuel industry be made to dismantle itself? What about the billions of motorists, manufacturers and other consumers and producers who would clamor for more. Sorry, there’s no bypassing the messy work of using pricing, regulation and innovation to get off fossil fuels.

I’m almost as skeptical re the Montana litigation — notwithstanding the earnestness of the young plaintiffs, including two brothers who not only are the sons of firearms-industry apostate Ryan Busse but who were motivated to join the lawsuit by the climatological deterioration of their beautiful corner of northwest Montana.

I identify with Lander and Badge Busse. Melting snow in nearby Glacier National Park helped trigger my ecological awakening, but in an opposite fashion from theirs. On a long-ago day in July, driving on the park’s Going-to-the-Sun Road with my grade-school pal, I parked our tiny Renault auto to fetch water dripping from roadside snowbanks. We filled our canteens and started walked uphill toward the source. An hour later, we were a thousand vertical feet above the roadway and following real-life mountain goats under an impossibly blue sky. Bookending our hike into the Grand Canyon a week earlier, that day became my gateway into love of wildness, defense of clean air, and a career in environmental policy analysis and activism.

Most of Glacier’s glaciers are now diminished if not gone, making the lawsuit, Held v. State of Montana, painful as well as valiant. Yet even if the brothers and their co-litigants win their case, what exactly is the remedy? The Montana Supreme Court possesses no magic button whose pressing can end the burning of fossil fuels. Stop drilling or mining in Montana, and producers will up their output from Wyoming. Stop it in all 50 states, and the same suppliers will boost production overseas. Sure, impeding fuel extraction will incrementally drive up fuel prices and take a bite out of demand, but that’s just a sideways blow at best. The solution, as CTC has argued since our founding in 2007, lies in throttling demand for carbon, not stoppering supply.

Montana litigation supporters weigh in

Shortly after this post went up, CTC received this brief rebuttal from a long-time supporter of the Montana suit and the larger Our Children’s Trust campaign to enshrine a legal right to a safe climate:

The Montana climate suit seeks to build case law affirming a right to a stable, livable climate. I liken it to the long-term legal struggle to secure equal treatment under the law for women and people of color. For example, the legal battle to desegregate schools was a long one built on case law. I agree that any individual state has limited ability to impose a price on emissions, but the Juliana vs. U.S. suit does. It seeks a science-based reduction in emissions sufficient to maintain a stable, livable climate, and proposes a carbon tax as the single most effective policy to achieve that goal. Likely the courts will only impose emission reductions. Politicians will then be tasked with submitting a plan that is affordable and effective. The Montana and other suits build case law affirming the damage caused by fossil fuel emissions and a right to a livable climate. Courts act more on evidence and less on short-term political pressure.

We also received this note from noted environmental attorney and climate-law expert Michael Gerrard, who directs the Sabin Center for Climate Change Law at Columbia Law School and was featured in the New York Times story noted at the top of this post:

I think we need to attack both the demand side and the supply side. No one action will affect the supply on a macro scale, but cumulatively many could. Montana is one of the nation’s largest fossil fuel suppliers, and if the courts shut down some of that, it would be a good thing. The judge, at least, is taking the case seriously. Whether or not the Montana Supreme Court upholds a decision for the plaintiffs, the case will cast a harsh light on the fossil fuel companies. Most of these campaigns are largely aimed at delegitimizing the fossil fuel companies and reducing their political clout. That is having some effect in blue states, where quite a few strong climate laws are being enacted over the opposition of the fossil companies. And keep in mind that each new coal mine, each new gas-fueled power plant, and so forth, creates a constituency for its long-term preservation; that needs to be resisted.

CTC collage from two separate photographs on Third Act website, snipped on March 30, 2023.

Banks and Climate

We come now to last week’s bank protest that Bill McKibben organized with his new “Community of Americans,” Third Act.

As much as I admire Bill’s unflagging zeal and his Third Act cohorts’ earnest willingness to put themselves out there, I strongly question targeting banks as a cause of fossil fuel exploitation and a locus for climate activism.

How will bank reformation impact the use of cars, trucks and planes in the U.S. or elsewhere — use that requires purchases of gasoline, diesel and jet fuel that in turn provide both the financial wherewithal and the political muscle to drill, extract, refine and transport petroleum products whose combustion releases the carbon dioxide that is wrecking our climate?

Should not Third Act and indeed the entire climate movement be organizing and demonstrating for demand-cutting policies and developments such as mixed-use and dense housing, functional-or-better public transportation, bikeable and walkable streets, fuel-economy standards without “light truck” loopholes, and the like? Wouldn’t their energies accomplish more, both short- and long-term, if they were to swarm Albany and other state capitals to demand upzoning, no more highway widenings, and permitting reform to circumvent anachronistic regulations hindering wind farms and solar homes?

In response, Bill would probably say “We need to remind people of the connection between cash and carbon. Literally, somebody who has $125,000 in those banks [Chase, Citi, Wells Fargo, Bank of America] is producing more [carbon] because it’s being lent out to pipelines and frack wells than all the cooking, flying, heating, driving, cooling that the average American does in a year. Five thousand dollars in [those banks] produces more carbon than flying back and forth across the country.”

How do I know? Because that’s exactly what he said on Democracy Now on the morning of the protests (quoted segment begins around 37:45). Try as I might, I can’t follow the logic.

Coda

Notice I haven’t mentioned carbon pricing, except tangentially. Here at CTC we’re laying low on carbon taxing for the time being. U.S. politics still aren’t ready, what with climate-averse Republicans occupying half of Congress, and Democrats wary of the difficult politics. We focus on what’s possible in the here-and-now.

Last year it was the praiseworthy (if imperfect) Biden-Schumer Inflation Reduction Act. This year we’re continuing to do what we can to bring congestion pricing for New York City into being. We’re also quietly nurturing a promising new avenue to advance a New York State carbon price. Please stay tuned!

Where We Are, Now that Biden’s Climate Change ‘Revolution’ Isn’t Coming

July 22, 2022 By Charles Komanoff

A New York Times post this week, Biden’s Climate Change ‘Revolution’ Isn’t Coming, caught our attention with its trenchant look at climate policy’s low ebb in the wake of two crushing setbacks in just three weeks: the June 30 Supreme Court ruling blowing up EPA’s carbon-regulating authority under the Clean Air Act, and Joe Manchin’s coup de grace to the remnants of President Biden’s Build Back Better climate package.

Drawing on fellow Times writers, opinion editor Spencer Bokat-Lindell painted an unsparing portrait of U.S. — and global — climate stasis as dangerous heat was enveloping Britain, much of Europe and large swaths of the U.S. Here we reprint his post in full, with our commentary as counterpoint.

Biden’s Climate Change ‘Revolution’ Isn’t Coming.

Introduction

When President Biden took office, one of the first things he did was make a pledge: The United States, he vowed, would finally “meet the urgent demands of the climate crisis” through “a clean energy revolution.” That revolution was to be set in motion by a $2 trillion plan for putting the country on a path to 100 percent carbon-free electricity by 2035 and to net-zero greenhouse gas emissions by 2050, in line with the Paris agreement’s goal of keeping global warming well below 3.6 degrees Fahrenheit above preindustrial levels. (It now stands at 2.2 degrees.)

But after more than a year of negotiations, compromises, deal-making and belt-tightening, that plan appeared to collapse last week when Senator Joe Manchin, a conservative Democrat from West Virginia and a key swing vote in Congress, announced that he would not support funding for climate or energy programs.

What does the collapse of Biden’s agenda mean for the domestic and global politics of climate action moving forward? Here’s what people are saying.

Biden’s Plan, Though Not Revolutionary, Was Bold.

Introduction

Even a fully intact Biden plan would have fallen short of its goals. Nevertheless, its scope and reach would have far surpassed any climate program by any major nation. Build Back Better’s carbon reductions and climate benefits would have been numerically substantial and would also have triggered parallel policies in other countries.

(Chart is from CTC Sept 2021 post, Without a Carbon Tax, Don’t Count on a 50% Emissions Cut.)

1. The climate deal that wasn’t

As my colleagues have reported, experts generally agree that there are two ways of reducing greenhouse gas emissions at the speed and scale required. The first is making fossil fuels more expensive by ensuring that their environmental costs — global warming, for one, but also the staggering harms of air pollution — are reflected in their price. While widely championed by economists, carbon taxes have proved politically unpopular: A carbon tax by ballot referendum in Washington State has failed twice.

Biden hoped to take the other approach: reducing emissions by driving down the cost and improving the efficiency of low-carbon energy sources, like wind, solar and nuclear power. Initially, the centerpiece of his plan was a clean energy standard, which would have legally required utilities to draw 80 percent of their electricity from zero-carbon sources by 2030 and 100 percent by 2035. But when Manchin — who made millions from his family coal business and took more campaign money from the oil and gas industry than any other senator — pulled his support from that scheme in October, Democrats pivoted to a $300 billion package of tax credits to encourage the adoption of renewable energy and electric vehicles.

Now, both avenues to decarbonizing the country have been all but closed off. Even before Biden’s plan was whittled down, there was some debate about whether it was sufficient to meet his ambitions. But now that the president’s most powerful tools for reducing emissions have been confiscated by Congress (and the Supreme Court, which last month limited the power of the Environmental Protection Agency to regulate power plant emissions), “We are not going to meet our targets, period,” said Leah Stokes, a professor of environmental policy at the University of Santa Barbara, California, who has advised congressional Democrats on climate legislation.

Manchin’s reason for scuttling the negotiations, according to his spokeswoman, was his desire to “avoid taking steps that add fuel to the inflation fire.” But in The Atlantic, Robinson Meyer argues that, in addition to being “extraordinarily bleak for the climate,” Manchin’s reversal will actually worsen inflation: By reducing long-term demand for oil, Biden’s plan would probably have lowered gas prices, and an earlier version of the package would have led to hundreds of dollars in annual energy cost savings for the average U.S. household by 2030, according to an independent analysis from researchers at Princeton.

“America’s climate negligence endures,” Meyer writes. “That is not just due to Senator Manchin’s negligence, of course. It is also the collective responsibility of the Republican Party, whose 50 senators are even more resolutely against investing in clean energy than he is.”

1. The long shadow of Washington state’s failed carbon tax referendum

Bokat-Lindell could have said, about carbon taxes, that they are widely championed by economists and others who judge robust carbon taxing as uniquely capable of delivering big emission cuts quickly. Still, his characterization of carbon taxes as politically unpopular was fair.

He was also on solid ground in pointing to the failed Washington State carbon tax referendum. Perhaps even more than Donald Trump’s concurrent electoral win over Hillary Clinton, the 2016 defeat of Initiative 732 put a hurt on U.S. carbon tax organizing and advocacy. After all, if a carbon tax couldn’t garner an electoral majority in a certified blue state — one with a strong outdoors-nature ethic to boot — it was likely to be a tough sell almost anywhere else.

During the run-up to that vote we published a raft of posts calling out progressive icons like Naomi Klein, Van Jones and Mary Kay Henry for willfully distorting I-732 — labelling as a tax cut for the wealthy its swap of the carbon revenues to cut regressive sales taxes, for example. Their high-profile drive-by opposition also encouraged environmental justice groups to view I-732’s revenue-neutral design as a ploy to block green investments in disadvantaged communities rather than a design to offset lower-income households’ higher fuel expenses. Mainstream environmental groups mostly stayed on the sidelines, as did climate champion Bill McKibben. Their neutrality contributed to the 59-to-41 electoral wipeout which poisoned the well for a Green New Deal-style reboot effort in 2018.

Fast-forwarding to 2021-2022, it’s also fair to ask why climate activists trained virtually all of their fire on Joe Manchin, perhaps not grasping that his personal and political indebtedness to fossil fuels — duly noted by Bokat-Lindell — placed him beyond their reach. As The Atlantic’s Robinson Meyer notes, 50 Republicans blocked Biden’s climate package no less than Manchin. Protests in their home states might have moved the legislative needle or at least thrown down a marker to preserve Democrats’ control of Congress in the coming midterms.

2. A domestic defeat with global consequences

Because the United States has spewed more greenhouse gases into the atmosphere than any other nation, it plays a uniquely prominent role in global climate politics. (It’s worth noting that on an annual basis, China is now the world’s largest emitter, having surpassed the United States in 2006, though America’s per capita emissions still far exceed China’s.)

Given the United States’ historical “climate debt,” many lower-income countries have made their climate commitments contingent on those of the United States and other rich countries. Especially after Donald Trump withdrew from the Paris agreement, many world leaders were hopeful that Biden would arrive at the Glasgow climate talks last year having secured some legislative achievement as a mark of political seriousness. That, of course, did not happen.

Now, the United States’ international climate credibility is even more damaged, which will in turn impede global decarbonization efforts, The Times’s Somini Sengupta writes. “Manchin’s rejection and the recent Supreme Court ruling dealt a heavy blow to U.S. climate credibility,” Li Shuo, the Beijing-based senior policy adviser for Greenpeace East Asia, told her. It underlines what many people abroad already know, Li said: that “the biggest historical emitter can hardly fulfill its climate promises.”

The U.S. climate envoy, John Kerry, is expected to attend the next round of climate talks, in November in Egypt, but will once again have little to show for it. The United States “will find it very hard to lead the world if we can’t even take the first steps here at home,” said Nat Keohane, the president of the Center for Climate and Energy Solutions, an environmental group. “The honeymoon is over.”

2. Goodbye to the myth of U.S. global leadership on climate

We noted upfront that in addition to their sheer numerical weight, Build Back Better’s carbon reductions would have triggered parallel policies in other countries. Bokat-Lindell articulates this well, with framing that, appropriately, prioritizes U.S. climate stewardship as “necessary” rather than merely “sufficient.”

What would translate almost automatically from the domestic sphere to the global is U.S. federal-level carbon taxing. The simplicity of a national carbon price alone makes it child’s play to replicate it in any other country — in marked contrast to the welter of tax credits, rules and line items embodying Biden’s climate plan that would be devilishly hard if not downright impossible to copy elsewhere. Moreover, the logical companion piece to a national carbon tax — a Carbon Border Adjustment Mechanism — would powerfully incentivize non-carbon-taxing countries to enact their own in order to capture for themselves carbon tax levies that otherwise would be collected by their carbon-taxing trading partners.

That said, the various stories and authorities cited in the Times column have it exactly right. The heavy weight of America’s outsize cumulative carbon emissions, combined with what now must be seen as chronic federal government inaction — aptly summarized by Greenpeace as (“the biggest historical emitter can hardly fulfill its climate promises”) — expose the U.S. as climate laggard rather than leader.

Unfortunately, that fact didn’t keep U.S. Senator Lindsey Graham (R-SC), who once supported carbon pricing via cap-and-trade (see this 2009 op-ed in the New York Times), from uttering this arrant nonsense this week: “I don’t want to be lectured about what we need to do to destroy our economy in the name of climate change.”

3. Where the politics of climate action go from here

The Biden administration will have to rely on its less powerful arsenal of executive actions to make progress on its decarbonization efforts, however short of its initial targets. As The Times’s Coral Davenport explains, the White House could use its regulatory authority to increase vehicle emissions standards, potentially catalyzing the transition to electric vehicles; to compel electric utilities to slightly lower their greenhouse emissions without falling afoul of the Supreme Court; and to plug leaks of methane — an extremely potent greenhouse gas — from oil and gas wells. Biden may also use his pulpit to push for action at the state level, where climate policy has assumed new importance in the absence of federal leadership. “States are really critical to helping the country as a whole achieve our climate goals,” Kyle Clark-Sutton of the clean-energy think tank RMI told The Times. “They have a real opportunity to lead. They have been leading.” Both California and New York, for example, have committed to reaching net-zero emissions by no later than 2050.

As far as national electoral politics are concerned, The Times’s David Leonhardt argues, the fact that a single Democratic politician was able to derail Biden’s climate agenda should prompt Democrats to redouble their efforts to increase their Senate majority, particularly by winning over more voters in red and purple states. “It is clear that many blue-collar voters don’t feel at home in the Democratic Party — and that their alienation is a major impediment to the U.S. doing more to slow climate change,” he writes.

It is also possible that the government’s sclerosis could spur interest in less conventional and extra-electoral avenues to addressing climate change, among them nuclear power (the promise and drawbacks of which have been explored in this newsletter; the “degrowth” movement; speculative technological fixes such as solar geoengineering; and mass movements of civil and uncivil disobedience, as the ecologist Andreas Malm called for in his book How to Blow Up a Pipeline.

As the Colorado River reservoirs dry up, as the death toll from the record-setting heat waves and wildfires scorching Europe rises, and as more than a billion people in South Asia recover from a season of heat extreme enough to test the upper limits of human survivability, “this moment feels interminable,” Meyer of The Atlantic writes. “But what is unsustainable cannot be sustained. If one man can block the industrial development of what is, for now, the world’s hegemon, then its hegemony must be very frail indeed.”

But then, climate change seems to remain a relatively minor concern among the U.S. electorate: Just 1 percent of voters in a recent New York Times/Siena College poll named it as the most important issue facing the country; even among voters under 30, that figure was 3 percent.

That is just one poll. But it would perhaps be premature to rule out another direction the politics of climate change might take, one that could prove familiar to those who have witnessed how the American public has processed other cumulative traumas, like the drug overdose crisis or gun violence or the pandemic: a resigned acceptance of mass suffering, punctuated by moments of shock that serve only as reminders of how the unimaginable became normal.

3. The impasse at the abyss

Bokat-Lindell packed many leads and ideas into his closing section. We’ve touched on a lot of them in the past year.

Our high points:

A. The “arsenal” of potential executive actions is terribly meager vis-a-vis the task at hand. Stronger CAFE standards, for example, are badly undermined by light trucks’ takeover of the automotive fleet, and are assumed in most climate emission scenarios anyway.

B. States-as-climate-loci is also overblown. A full two dozen are solidly red, i.e., fossil fuel dominated. Even in blue states, policy is circumscribed by federal authority and bureaucracy; the holdup of New York’s congestion pricing program by federal highway officials is one case in point. Moreover, visions of 2050 net-zero or 2035 grid decarbonization by California and New York are almost certainly way out in front of actual commitments and have been made needlessly more difficult by nuclear power plant shutdowns.

C. Securing a true Democratic Senate majority and retaining the House this November are indeed vital.

D. Like Andreas Malm, we believe that direct action in defense of climate and earth needs to come to the fore, as we proposed in two posts last summer inspired by Malm’s book: Christopher Ketcham’s essay, Let’s Blow Up Luxury Carbon, and my own “Rich people cannot have the right to combust others to death.” Both are worth your attention.

E. The low primacy of the climate crisis among voters is both real and arguably not fatal. The U.S. is beset by so many crises that even so committed a climate scientist as Peter Gleick declared this week his greater alarm over incipient fascism.

A greater cause than insufficient ardor of the U.S. failure to enact “revolutionary” or even strong, incremental climate policies is an unproportionate and cumbersome political system that puts up multiple roadblocks to systemic change.

Alas, that isn’t poised to change. More and more, it looks like achieving genuine climate action will require passionate and creative direct action. Targets abound: helicopter commuting, crypto “mining,” obstructionists of wind farms or dense housing or congestion pricing, to name a few. Successful actions will be those that harness broad-based and truly intersectional campaigns attacking not just emissions but privilege and wealth.

We have an idea or two up our sleeve. Perhaps you do as well. We wish you luck. We still insist that carbon taxing is revolutionary — how can tackling a fundament of fossil fuel dominance be otherwise?

Bitcoin Mining is Gobbling Up New York’s Precious Renewable Energy

May 13, 2022 By Charles Komanoff

(As published today in NYC-based Gotham Gazette. Footnotes appear at end. — C.K., May 13, 2022)

Like time in Steve Miller’s classic-rock song, New York’s decarbonization targets keep slipping into the future.

Highway widenings are spurring more driving. Suburban resistance to upzoning is locking in energy-demanding sprawl. Electricity from the state’s wind turbines shrank last year,¹ even as climate advocates, relying on dodgy U.S. Energy Department modeling, overstate future carbon reductions from “electrifying everything.”²

Promising developments like offshore wind leasing and new transmission to carry hydroelectricity from Quebec barely compensate, if at all, for carbon emissions unleashed by closing the Indian Point nuclear plant. As I have pointed out elsewhere, shutting existing zero-carbon power sources means that new ones don’t actually cut emissions; at best, they keep us running in place, punching huge holes in pledges to achieve a carbon-free power grid by 2040.

To this dreary picture, add crypto mining — enormous networks of electron-eating computers running 24-7 so that digital currencies like Bitcoin and Ethereum can maintain virtual “coins” or “tokens” in encrypted ledgers that bypass traditional third parties like banks.

From Buffalo and the Finger Lakes to the state’s northern tier, crypto entrepreneurs are building new generators or firing up retired ones to power their crypto mining operations. Other crypto sites draw on the grid.

Self-sourced or not, the requisite electricity ends up forcing additional burning of fossil fuels, as Sierra Club researchers documented in extensive comments this week to the President’s Office of Science and Technology Policy, pushing the state’s ambitious decarbonization goals further out of reach. To what end?

In Uber’s Footsteps

Enigmatic, opaque, futuristic — crypto-currency cries out for historical analogues. Here’s one: Uber.

Uber burst on the scene in the early 2010s not as a new form of transportation but a new kind of network enabling a reconfiguration of transportation. Its appeal was tailored around three promises: it would enhance traffic efficiency by eliminating cruising for fares; it would extend convenient for-hire vehicle service outside Manhattan; and it would end service refusals to people of color.

The packaging — sleek and app-enabled — augured a frictionless, digital future. With a few taps New Yorkers could summon a chariot.

The results were mixed. We now know that stockpiling of Ubers in Manhattan has wrought even more gridlock than taxi cruising. But Uber did broaden access to for-hire vehicles, even as it bled ridership from the MTA and, worse, rained economic ruin on the incumbent yellow-cab industry.

Bitcoin and other crypto-currencies come with their own glossy promises, though these are more chameleon-like. (Earlier this year New York Times columnist Paul Krugman disparaged them as “word salad.”) Among them, as Annie McDonough reported recently in City & State, is the prospect of liberation from ingrained discriminatory banking and lending by U.S. financial institutions.

“[Crypto backers] see the technology as an economic equalizer,” writes McDonough. “A tool not just for the rich to get richer, but for people who have been discriminated against by banking institutions or locked out of investment opportunities, including people of color and low-income communities.”

Really? In New York, and almost certainly anywhere else, unbanked households overwhelmingly lack the requisite credit history or liquid assets — bank accounts, debit cards, credit cards — to purchase cryptocurrency tokens. Moreover, scammers and grifters are finding crypto fertile territory for high-tech swindles, as New York Times columnist Farhad Manjoo noted this month. An arguably safer and more effective way to root out credit segregation would be to speed Biden administration rulemaking to add teeth to the Community Reinvestment Act — the 1977 law intended to repair decades of redlining.

The emergence of crypto-front groups like the National Policy Network of Women of Color in Blockchain demonstrates the industry’s readiness to exploit deep-seated bitterness over legacy redlining. So does the participation in crypto lobbying of Bradley Tusk, the one-time Mike Bloomberg consigliere who a decade ago deftly deployed Black fury over persistent taxi discrimination to help Uber eradicate cabbies’ exclusive right to pick up street hails in Manhattan and subsequently helped fend off serious regulation of the app-ride industry for several crucial years.

Let’s Burn Up The Grid

There is no registry of electricity consumed by crypto mining in New York State. Worldwide, though, crypto burns through an estimated 91,000 gigawatt-hours (or, 91 billion kilowatt-hours) of electricity annually, according to a New York Times survey of crypto last September. Some 16% of that, or 15,000 GWh, is said to be consumed in the United States.

While New Yorkers are accustomed to thinking of our state as resource-poor, crypto miners are now exploiting half-a-dozen hydro power sites and formerly boarded-up fossil-fuel plants in northern and western New York. One industry source cited by City & State estimates that 13-14% of his company’s U.S. crypto mining takes place in our state. Extrapolating that share across the industry, crypto is annually consuming 2,000 GWh of electricity in New York State — a figure that could grow not just with increased transactions but with ever-more complex digital encryption.

Even holding at 2,000 GWh, that’s a lot of juice: more than the electricity generated last year from all the solar panels on residential buildings in the state, or more than what will come from the first 100 promised offshore wind turbines once that industry launches (see graph below). And, though crypto in New York consumes less electricity than all current solar or wind, that comparison is of no comfort, as those renewable sources need to be displacing fossil fuels (primarily fracked gas) from the state’s grid — which they can’t do if their output is effectively being consumed mining Bitcoin.

The operative word, “effectively,” encompasses two distinct but complementary dynamics. Grid dynamics dictate that any new locus of demand such as Bitcoin forces utilities to draw more heavily on fossil-fuel generators, because the non-carbon sources — nukes as well as renewables — already run as flat-out as they can. The climate dynamic is that from a statewide perspective, additional use of fossil-fuel generators negates the carbon-reduction benefits that wind and solar and nuclear would otherwise provide.

This perspective casts a harsh light on claims that a particular crypto installation is being renewably sourced. Connecting crypto to a refurbished hydro dam or solar or wind farm may sound green, but all those whirring hard drives are really siphoning off carbon-free electricity that now “won’t be available to power a home, a factory or an electric car,” as the Times’ 2021 story put it. (One hopes that the irony of crypto adherents miscounting green electrons doesn’t carry over to their currency bookkeeping.)

Carbon Tax vs. Crypto?

A stiff New York State carbon tax could slow and even reverse the rise of cryptocurrency here (likewise nationwide).

The rise in electricity prices would undermine whatever competitive advantage Bitcoin miners gain from locating in New York. Some miners would leave, new ones would stay away, and those who stay would endeavor to blunt the impact of the tax by upgrading their efficiency.

Not only that, crypto miners seeking zero-carbon generation increasingly would find themselves competing with non-crypto businesses seeking to contain their power costs. Other businesses, less power-intensive per dollar of revenue, would be in position to outbid the crypto companies.

The prospective flight to other jurisdictions could help build momentum to tax carbon emissions there as well, as more states and countries come to conclude that crypto jobs and revenues aren’t worth straining their grids, not to mention trashing their air-sheds and stealing their quiet.

This isn’t to hold out carbon taxing as a one-bullet crypto killer — we need many bullets for that, the bigger the better — but to illustrate its broad potential to stop frivolous (and in this case imbecilic) new uses of electricity before they can gain a foothold.

Why not regulate crypto away? That battle would consume years, tying down policy resources while emissions continued to spew. Worse, we have neither the time nor the ability to see around corners required to enact, piecemeal, restraints on each new locus of energy demand.

Even as energy-efficiencies continue to do wonders — total U.S. electricity use last year was just a few percent higher than in 2005³ — underpriced electricity elicits new hellspawns of needless use that undo much of that progress.

Carbon taxes by themselves can’t solve everything that ails climate. But they could, for a change, get the solutions out in front of the problems.

***
Charles Komanoff, long-time New York policy analyst and environmental activist, directs the Carbon Tax Center. On Twitter @Komanoff.

¹US Energy Information Administration, “Electric Power Monthly,” Table 1.14.B, “Utility Scale Facility Net Generation from Wind,” shows 4,522 GWh in New York State in 2020 and 4,387 GWh in 2021.

²To estimate future carbon reductions from the December 2021 New York City ban on gas heating and cooking in new buildings, the law’s proponents and the Dec. 15, 2021 New York Times story reporting on it both cited a Dec. 10, 2021 post, Stopping Gas Hookups in New Construction in NYC Would Cut Carbon and Costs, by the consultancy RMI. The RMI authors note that their calculations employed future electricity grid emission factors modeled by U.S. DOE’s National Renewable Energy Lab’s “Cambium” dataset. Examination of that dataset reveals, inter alia, that it assumes a non-existent five-fold increase in New York State on-shore wind-generated electricity from 2020 to 2022.

³Figures from US Energy Information Administration, “Electric Power Monthly,” Table 7.2a Electricity Net Generation: Total (All Sectors)” supplemented by Table 10.6 (“Electricity Net Generation from Distributed Solar”) indicate total U.S. electricity generation of 4,164,565 GWh in 2022 and 4,055,785 GWh in 2005. For those interested, the implied compound annual average growth rate over those 17 years is a minuscule 0.17 percent.

Correction: This post was amended on May 26 to reflect the fact that New York’s estimated 13-14% share of U.S. crypto mining applies to a single crypto company rather than industry-wide. The extrapolation to other companies is the author’s, not the source’s.

May 16 addendum: We strongly recommend How crypto made me fall in love with carbon pricing all over again, an April 27 essay by Frontier Group energy analyst Tony Dutzik covering the intersection of crypto mining, carbon pricing, energy demand and Jevons Paradox.

Green Fragility: Alternatives to California’s Pro-Car Giveaway

March 26, 2022 By Charles Komanoff

If Gov. Newsom is willing to just toss our emissions goals by rewarding car ownership and gas tax holidays for no reason other than to get re-elected in the safest blue state then it’s settled that California leaders were just virtue signaling about global warming the whole time.

— Darrell Owens (@IDoTheThinking) March 25, 2022

Of the myriad motorist giveaways now being rushed into place around the U.S., none sting like California’s. I share Darrell Owens’ tweeted dismay, not just because California is so reliably blue but because Gov. Gavin Newsom’s proposed car-cash payments point to a troubling fragility in the state’s clean-energy leadership.

The specifics of the so-called relief plan are still being worked on. But the basic shape is expected to hew to the contours posted by Newsom’s office this past week and shown further below: $9 billion in payments to households of $400 per registered car (limit of 2 per family) and just $2 billion to make transit cheaper.

While a per-vehicle stipend isn’t quite as environmentally loathsome as the gas and diesel tax “holidays” already rolled out in Georgia and Maryland and being readied elsewhere (NPR has a useful digest), California’s nearly 50-year record at the forefront of cleaner energy might have suggested other, greener approaches.

I know that record well. Not long ago, I did a study comparing California’s rate of decarbonizing its economy to the rest of the country’s. I found that from the mid-1970s to 2016, California drove down its use of fossil fuels per unit of economic activity nearly 20 percent faster than the other 49 states. Had those states matched California’s pace, I calculated, the country would now, each year, be eliminating 1,200 megatonnes of CO2, an amount equivalent to the carbon emissions from our entire fleet of passenger cars.

Those findings became the basis of a 2019 report for the Natural Resources Defense Council, California Stars: Lighting the Way to a Clean Energy Future. My NRDC co-authors and I credited a host of actors: Gov. Jerry Brown (1974-82, 2010-18), for imbuing an energy-efficiency ethic throughout the machinery of state government; Gov. Arnold Schwarzenegger (2003-10), who lent “Terminator” cred and financial support to solar power; and, above all, the thousands of resourceful and devoted state employees who developed and oversaw a kaleidoscope of performance standards that embedded energy efficiency into appliances, equipment and buildings.

Alas, California’s energy record also had an un-stellar part: automobiles. “Passenger vehicles continue to be a weak point,” we noted dryly in “California Stars,” as the state’s consumption of motor fuels grew faster than the rest of the country’s during 1975-2016 (albeit a tad more slowly per unit of GDP). We listed many factors but omitted the most fundamental: California’s vaunted green ethos didn’t include recognition of, and resistance to, car-dependent transportation.

Consider that the day before yesterday, in New York, a coalition of transit, environmental and economic-justice organizations declared their opposition to a possible statewide gas tax holiday “because it does little to help those New Yorkers most hurt by rising prices, takes revenue away from needed road and transit investments and completely contradicts New York’s climate goals.” The groups, who have long worked in concert for safe streets, congestion pricing and better transit, pointed to rising prices for energy (electricity and heating fuels, not just gasoline), food and housing and called for targeted state aid to lower-income households.

Read it and weep: Gavin Newsom’s proposed give-away to California car-owners.

If similar noises are being made in Los Angeles or San Francisco, they aren’t yet audible in New York. Nor do we know what California’s iconically green ex-governors would have done in the face of $5 or $6 gasoline. (The state’s anti-smog rules and carbon cap-and-trade program lead to unusually pricey motor fuels.) I’d like to believe they would have used the gas-price “crisis” as an opportunity to speak inconvenient truths about driving, fossil fuels and climate stewardship. Perhaps Brown would have harkened back to his seventies self and encouraged Californians to voluntarily curtail the share of their driving that is particularly mindless and unnecessary. Schwarzenegger, who earlier this month made an extraordinarily empathic antiwar video appeal to Vladimir Putin’s subjects (“I love the Russian people. That is why I have to tell you the truth.”), might have connected less driving and fuel conservation to patriotism and manliness.

While Newsom lacks those predecessor’s strong personal stamps, he doesn’t lack for imaginative staff. Think of the good the state could do for economic justice and climate protection with the $9 billion he’s handing car-owners.

The most obvious scheme is to apply that money to reduce the state sales tax, a stunningly regressive tax. California’s 7.25% state sales tax brings in around $45 billion annually, according to Tax Foundation figures ($42.7 billion in FY 2020, the most recent figure available), suggesting that $9 billion worth of lower sales taxes would enable the state to cut the rate by one-fifth, to a little under 6%. That change would give relief to every Californian, and disproportionately to poor and working families, without rewarding automobile use and dependence. And it would align nicely with The Economist’s insistence yesterday that “Governments should support household incomes instead … of cutting fuel taxes.”

(Sales tax swaps aren’t exactly novel in environmental discourse. Washington state’s I-732 initiative would have used revenue from a $20/ton carbon tax to cut the state sales tax — the nation’s steepest — by one percent; it was defeated, in 2016, when some climate hawks derided it as, somehow, pro-corporate. Two decades earlier, I published an op-ed calling for a nickel-a-mile charge on driving in Long Island, NY, with the proceeds paying for a 3 percent cut in Nassau and Suffolk Counties’ sales tax.)

M.I.T. Dept of Urban Studies alum Joan Walsh is a board director of AC Transit in Oakland, CA.

In a different vein, folks in the bicycling circles I inhabit are touting free e-bikes rather than car-based giveaways as a means to cushion the pain of high gas prices while helping spur people away from automobiles. The same $9 billion would allow Sacramento to issue e-bike rebates of $300 each to of the roughly 30 million Californians of bicycling age (say, 10 to 80). Making the rebates tradeable would bend to two realities: not everyone can or will use a bike — even one with electric assist — and supplies are constrained. The latter factor suggests that the rebates should remain valid for several years.

Doubtless, there are other productive ways California could distribute $9 billion in economic relief. What makes the planned automobile giveaway so dispiriting is that for half-a-century the state has done so much in green energy and electricity, outside of the transportation sector, that is pro-climate, pro-consumer and innovative. Gov. Newsom’s rush to invest $9 billion in a one-shot that pulls in the opposite direction is damaging in itself and also indicative of the fragility of California’s supposed green ethos.

War, oil, and carbon taxes: A primer

March 9, 2022 By Charles Komanoff

Prices of gasoline and other petroleum products as well as methane (“natural”) gas were already unusually high in the U.S. before Russia invaded Ukraine on Feb. 24. Less than two weeks on (March 9), they’re at levels not seen since 2008, prompting the usual motorist grumbling but also creating hardship for squeezed families. Here we shed light on four key questions:

Is the backlash against high pump prices an argument against pursuing carbon taxes?
How big a hit are U.S. consumers taking from the higher fuel prices?
Is demand for gasoline sensitive to the price at the pump? If so, how much?
How much could the U.S. cut oil demand, right away?

Q1: Is the backlash against high pump prices an argument against pursuing carbon taxes?

A1: No.

Joseph Majkut explains:

Things that are not the same:
A carbon price with transfers to households and oil price increases from supply shocks.

— Joseph Majkut (@JosephMajkut) March 8, 2022

Let’s unpack the tweet from Majkut, former Senate staffer and Niskanen Center climate specialist now with the national security think tank CSIS.

Supply shocks, like today’s, exact monies from businesses and consumers and transfer it to the oil industry — extractors, refiners, traders, brokers, insurers.

Carbon pricing, in contrast, is imposed by governments. And though it leads, deliberately, to higher fuel prices, the tax monies are collected by government and become revenues that can be used for public purposes. The “canonical” outlet — the one increasingly urged by carbon-pricing advocates in NGO’s and government — is to distribute (“transfer,” in Majkut’s phrase) the revenues as equal “dividends” to households.

The wealthiest U.S. household quintile spends 3.3 times as much on gasoline as the poorest. So dividing the revenue pie equally among all households yields a big net plus to lower-income families.

This fee-and-dividend approach, pioneered by Citizens Climate Lobby, is income-progressive because lower-income households spend fewer dollars on fuels (directly plus indirectly) than wealthier households. Fuel price shocks, on the other hand, are regressive because lower-income households spend a larger share of their budgets on fuel.

If these points appear contradictory, please study the donut chart at right, or consult our page, Ensuring Equity. It’s the dividend that makes carbon pricing progressive, and the lack of a dividend that makes oil shocks regressive.

Q2: How big a hit are U.S. consumers taking from the higher fuel prices?

A2: A pretty big one, though it’s probably transitory.

In 2019, the last pre-pandemic year, the U.S. consumed 32.2 quads of methane (“natural”) gas and 43.5 quads of petroleum products. (A quad, or quadrillion Btu, is a standard metric for characterizing enormous energy quantities.)

Methane gas is used for power generation, heating of homes and commercial buildings, and as process heat for industry. Petroleum products encompass not just gasoline but home heating oil, diesel fuel burned by large trucks and machinery, kerosene for aircraft, residual oil for large commercial ships, propane for heating (largely in rural areas that aren’t connected to gas lines) and lubricants. Non-gasoline fuels typically account for a little over half of petroleum usage, with gasoline a bit less than half. (CTC’s carbon-tax model breaks down a lot of these uses.)

On a per-btu basis, i.e., for an equivalent amount of heat or energy, petroleum products are far more costly than methane gas. Gasoline at $4.00 a gallon, the approximate national average pump price in early March, equates to $32 per million Btu; whereas during 2016-2020 methane gas averaged only a little more than $2 per million Btu at the wellhead and $6 delivered to the average customer. (Yes, refining crude oil into petroleum products is really costly.)

We made a back-of-the-envelope estimate of what the disruption of global energy markets due to the Russian invasion of Ukraine is costing U.S. consumers. We assumed a 15 percent rise in petroleum-product prices, along with a 50 percent rise in the wellhead price of methane gas as profit-maximizing owners diverted some supplies to LNG tankers bound for Europe. With these assumptions, the impacts on U.S. consumers — businesses along with households — are in the neighborhood of $400 million a day for higher petroleum fuels and $100 million a day for costlier methane gas. (Gasoline accounts for “only” $150 to $200 million of the $500 million total.)

Mathematically, the total, around $500 million a day, works out to around $4 a day in added costs for an average U.S. household. With a robust carbon tax in place, the supply shock would be far smaller. Households wouldn’t be consuming as much oil, and the increased slack in the world oil business would shrink the opportunities for profiteering by oil owners and traders.

Q3: Is gasoline use sensitive to the price at the pump?

A3: More than most people think, though less than we wish.

We examined the price-elasticity of gasoline in 2015, in a post, What an Energy-Efficiency Hero Gets Wrong about Carbon Taxes. The post presented a linear regression model that correlated year-to-year changes in U.S. gasoline consumption with changes in economic activity (GDP) and in the real (inflation-adjusted) price of gasoline. Here’s what we wrote then:

We “regressed” the annual percentage changes in U.S. gasoline consumption from 1960 through 2014 on three independent variables: (i) the same year’s percentage change in economic activity (GDP); (ii) the same year’s percentage change in the average real retail price of gasoline; and (iii) the average percentage change in that price over the 10 years prior to the current year. The third variable was intended to reflect lags inherent in Americans’ responses to changing gasoline prices, insofar as automobile purchases and location choices that affect usage tend to change over years rather than weeks or months. The parameters may be referred to as income-elasticity, immediate price-elasticity, and lagged price-elasticity, respectively.

Imagine the benefits from impounding vehicles like these for the duration of the Ukraine War — or the climate crisis!

This week we updated the model with gasoline consumption and price data through 2021. Here’s what we found:

The income-elasticity of gasoline consumption is a little over 0.5 (0.53, to be precise), meaning that a 1 percent rise in GDP is associated with a 0.5 percent rise in gas use.
The immediate price-elasticity of gasoline consumption is (minus) 0.11, meaning that it takes nearly a 10 percent hike in the average price at the pump to bring about an immediate 1 percent drop in usage; this validates the perception that in the short run. gasoline use is only barely responsive to price changes.
The lagged price-elasticity of gasoline consumption is (minus) 0.19. The sum of the immediate and lagged price-elasticities is (minus) 0.30, indicating modest sensitivity of usage to price over a longer time horizon. A sustained 10 percent hike in gasoline prices would tend to elicit a 3 percent drop in usage.

(Incidentally, this 3-variable model — actually, we used 5 variables, including “dummy” variables to isolate gas use in 2020 and 2021, the pandemic years — explains nearly 80 percent of the year-to-year variation in U.S. gasoline consumption.)

Here are four takeaways from our modeling:

Holding prices constant, gasoline usage in the U.S. has been partly decoupled from economic activity, since two units of economic growth lead to only one unit of growth in gasoline use.
U.S. gasoline demand isn’t entirely price-inelastic, though it is nearly so in the immediate (short) run.
Over a longer period, demand for gasoline displays some price-sensitivity, suggesting that by raising pump prices, carbon taxes can have some sway over usage.
Still, the relative price-inelasticity of gasoline indicates that even robust carbon taxes won’t have a big direct effect on usage; the bigger impacts will come from speeding the transition to electric vehicles and, we hope, fostering turns in the culture that promote and valorize reduced fuel use

Q4: How much could the U.S. cut oil demand, right away?

A4: By a lot. (But we won’t.)

In early 2002, not long after the Saudi-enabled attacks that destroyed the World Trade Center, I published a blueprint for achieving an immediate (“overnight”) 5% cut in U.S. oil consumption, with the reductions reaching 10% within six months.

I produced this U.S. oil-saving plan in early 2002, hoping to rally post-9/11 public opinion to slash U.S. oil dependence.

Given the reality that changes in capital stocks that underlie oil consumption — the cars people own, the cities and towns where they live — can’t change overnight, the booklet’s guiding idea was to “collectively change individual behaviors” that added up to the 19.3 million barrels of petroleum products being consumed daily in the U.S.

My thinking then was that behavior changes away from petroleum consumption could finally explode from niche to commonplace if the changes were hitched to a higher purpose — national security and patriotism, in this case. Bicycle commuting, carpooling, thermostat setbacks, electricity conservation would become widespread as their aura changed from fringe-y to patriotic.

Sadly, this never caught on. Our declaration “that we face a choice between love of oil and love of country” and our call to the Bush administration “to break with past policies of subsidizing oil consumption and treating every oil-consuming activity, no matter how discretionary or wasteful, as essential,” fell on deaf ears.

Today, U.S. oil consumption is greater than it was on 9/11. U.S. households, businesses and industry consumed an average of 20,540,000 barrels of petroleum products in 2021, around 5 percent more than the 19,700,000 barrels used daily in 2000.

If anything, calls to alter individual behavior to cut down on consumption of oil and other fossil fuels, whether for geopolitical purposes (to shrink Russian government and oligarch cash reserves) or for climate (to dial back carbon emissions), are frequently derided on the left as “lifestyle-shaming” and diversions from the “urgent task of system decarbonization.” In a New Yorker magazine profile of Sunrise Movement organizers earlier this month, for example, one activist dismissed Al Gore’s exhortation in 2006 to replace electricity-gulping lights because “even if you change all the light bulbs in the country, you don’t come close to preventing catastrophe.” In fact, multitudes of bulb swaps since then have helped flatten U.S. electricity demand, keeping hundreds of millions of tons of coal in the ground — this country’s biggest climate triumph to date.

We conclude this post with a screenshot of the opening pages of “Ending the Oil Age.” The full 44-page report may be downloaded here (pdf). Readers with an historical bent, take note: The report also proposed hefty taxes on gasoline and jet fuel that, in my telling, could replace the patriotic impulse to conserve petroleum as the murderous, petro-dollar-fueled attack on the World Trade Center began to recede into the past.

Pages 1 & 2 from “Ending the Oil Age.” Link to the report is in the last text paragraph, above.

Since climate progress is stalled, let’s unload on fee-and-dividend

January 26, 2022 By Charles Komanoff

Someone chose an inopportune time to beat up on carbon taxing’s fee-and-dividend variant. Not U-C Santa Barbara political scientist Mitto Mildenberger, whose paper, Limited impacts of carbon tax rebate programmes on public support for carbon pricing, co-authored with scholars from Montreal, Vancouver and Bern (Switzerland), appeared this week in the prestigious journal, Nature Climate Change. No, I mean iconoclast blogger David Roberts, who used Mildenberger’s provocative paper as a launching pad to again dunk on carbon pricing and people who still hold out hope for it.

Roberts’ post, Do dividends make carbon taxes more popular? Apparently not., published on Monday on his Volts platform, gets off on the wrong foot right away, claiming:

Economists have long insisted that pricing carbon is the most efficient way to reduce greenhouse gases. For years, they hijacked the climate discourse, with untold money and effort put behind proposals for various increasingly baroque pricing schemes, to very little effect. (emphasis added)

Roberts may be right about efficiency and economists, but his description doesn’t fit climate hawks like Citizens Climate Lobby and Carbon Tax Center. We place our chips on carbon taxes not on account of their economic efficiency but because of their unrivaled potential to slash carbon emissions quickly in the U.S. — and also their global portability.

The meat of Mildenberger’s paper and Roberts’ post, distilled in their respective titles, is that in the only two countries with some form of fee-and-dividend carbon pricing, not just public support but basic awareness of the programs, particularly the dividends themselves, is middling at best.

We think this “finding” is both questionable and beside the point. Let’s take a close look at each of those countries: Switzerland and Canada.

Switzerland

Official Swiss notice of this year’s carbon dividend. At the current 1.09 exchange rate, 88.20 CHF = $96.14.

Switzerland’s carbon tax began in 2008 and reached its current level of 96 Swiss francs per metric ton in 2018. Converting metrics and currencies, that equates to $95 per ton of CO2, the kind of level that carbon taxers dream about. According to CTC’s carbon tax model, if the U.S. next year started a $15/ton carbon tax and ramped it up to reach $95 in 2030, emissions in that year would be 33% less than in 2005, taking us 2/3 of the way to the Biden target of halving 2005 emissions in 2030.

Not only that, a U.S. carbon tax at the Swiss level of $95 a ton would generate a carbon dividend in 2030 of $1,500 per person, even allowing for reduced emissions and a larger population and equal shares for children. Surely, a $1,500 carbon check — or, if you prefer (and we do) 12 monthly carbon dividends of $125 per person — would translate into strong and rising popularity, especially considering that a majority of people and households would be expending less than those amounts in increased direct and indirect energy costs.

That’s the straw man. The reality is that Switzerland’s $95/ton (U.S.) carbon tax will deliver only $96 in per-person dividends for the entire year. (See document at left, downloadable here.) That’s less than one month’s worth of what U.S. residents would receive under a full fee-and-dividend scheme for a Swiss-level $95 carbon tax. In that light, it should be no surprise that Mildenberger and his co-authors didn’t find residents of Geneva or Zurich dancing in the streets over their carbon dividends. In U.S. terms, Swiss residents’ 2022 carbon tax dividend is what Americans would get in 2030 from a piddling carbon tax of $5.50 per ton of CO2.

Why the discrepancy? Why is Switzerland’s carbon dividend only 1/15 as great as what a U.S. dividend would be from a carbon fee of the same level?

Excerpt from Switzerland Federal Office for the Environment document, “The Swiss Approach to Carbon Pricing,” May 2021.

There are four big reasons. First, Switzerland’s energy consumption is far less per capita than that of the United States. Second, hydro-electricity rather than carbon-based fuels like coal and methane powers the country’s grid. Third, the Swiss carbon tax exempts transport and agriculture and more than half of Swiss industry (see graphic at right; full document here). Fourth, part of the tax revenue is siphoned off by businesses before the dividends get calculated.

No wonder, then, that Switzerland’s carbon dividend is so meager. Consider further that, as Mildenberger et al. point out, “Citizens receive their rebates as a discount on their health insurance premiums, with annual notifications about this monthly benefit through health insurance forms.”

Annual notifications through health insurance forms. This is reasonable, even enlightened, public policy. It’s also almost diabolically designed to obfuscate the dividend side of the carbon fee coin.

Canada

Canada’s carbon tax is far more complicated than Switzerland’s. When we last updated CTC’s Canada page, in March 2011, we characterized carbon pricing in the country’s 13 provinces as follows:

Six provinces, including Ontario and Alberta, were covered by the federal pricing scheme that would reach $50/tonne in 2023 — around $36/ton in U.S. terms — and then ramp up sharply to $170/tonne by 2030.
Four were deploying their own carbon tax, led by British Columbia, which inaugurated the Western Hemisphere’s first meaningful carbon tax in 2008.
Quebec and Nova Scotia were part of a two-country carbon cap-and-trade program that is anchored by California.
New Brunswick employed an output-based carbon pricing system.

Wording courtesy of UCSB Prof. Matto Mildenberger, lead author of the Nature Climate Journal article discussed here.

Given this patch-quilt, as well as the novelty of carbon pricing in most of Canada, it seems to us unsurprising that polling that commenced in February 2019 (and extended through May 2020, with five “waves” in all) would yield the mixed results reported in the Midenberger paper: upticks in two provinces, Ontario and British Columbia, and downturns in the other three, Quebec, Alberta and Saskatchewan.

The “core question” asked in the Canada polling, as described by lead author Mildenberger, who graciously shared it with us yesterday via email, is shown at left. The language is neutral, perhaps to a fault. It offered no affirmative spin, such as “Canada recently began taxing fossil fuels in order to protect the climate, with the money rebated in ways that will help households get ahead financially.” That kind of favorable tilt could perhaps be justified as necessary to counter the negative vibe surrounding taxation generally.

To be sure, that negative vibe is precisely what drives pundits like Roberts to deride carbon taxing, as he did in the second and third paragraphs of his post:

Over time, political experience with carbon taxes has highlighted a truth that should have been obvious long ago: carbon taxes are taxes, and people don’t like taxes. People don’t like paying more money for stuff.

More broadly, carbon taxes are an almost perfectly terrible policy from the perspective of political economy. They make costs visible to everyone, while the benefits are diffuse and indirect. They create many enemies, but have almost no support outside the climate movement itself. All the political intensity is with opponents.

We get it. We know full well the albatross that taxation always bears. But we also know that taxes on “bads” have been enacted into law. The U.S. government taxes cigarettes, as does every state. New York City taxes grocery bags, and Philadelphia and Berkeley, CA tax sugary soft drinks.

Obviously, taxing something as supercharged financially and culturally as fossil fuels is a much heavier lift, as evidenced by the absence of explicit carbon taxing anywhere in the fifty states. (We exclude federal and state motor fuel taxes, due to their tie-in to roads rather than health or climate; we also exclude New York State’s Petroleum Business Tax, though its support of NYC metro-area transit perhaps merits an honorable mention; conversely, New York City’s congestion pricing program, now scheduled to begin in 2023, will create a strong template for carbon taxing, as we’ve pointed out many times, including in The Nation magazine in 2019.)

So yes, carbon taxing — not fig-leaf $20/ton-and-no-higher carbon taxing a la Exxon or the occasional Republican, but a levy rising steadily to triple digits before 2030 — is hard stuff. But so is just about every other decarbonization policy or program, especially if done at scale.

Well-heeled NIMBY’s have whittled down wind projects for years; now, so too may supply-chain problems. Rooftop solar endures pushback not just from utilities and their high-wage unions but also from concerns that lower-income residents could gett stuck with higher utility bills. Only splinters of President Biden’s Build Back Better plan, which wasn’t going to be able to deliver its promised 50% cut in emission by 2030 anyway, will pass, thanks to one or two Democratic senators and 50 Republicans. Even the push to electrify everything may find its vaunted carbon benefits a good deal less potent than advocates imagine, an issue we intend to explore in a future post.

A record one-third of Americans in the latest “Global Warming’s Six Americas” are “alarmed” by climate change.

Still, though, the biggest misdirection in the Mildenberger et al. paper and the Roberts post may be their fretting over public opinion in the first place. The public doesn’t have to love carbon fee-and-dividend. It simply needs to embolden political leadership that will enact it (and the raft of complementary policies) into law and ensure that the fee, which shouldn’t be set too high to start, can keep rising over time.

Public opinion increasingly supports climate action, not tepidly but “with alarm,” as the latest Yale – George Mason opinion survey of “Global Warming’s Six Americas” attests (see graphic at right, and more detailed treatment with link here). It’s past time for carbon pricing naysayers to throw off their ideological blinders and get behind policies that can pass and deliver.

PS to David Roberts: Contrary to your Volts post, fee-and-dividend did not “los[e] badly in a public referendum in 2016.” What went down to defeat in Washington state was a sales tax swap of the carbon revenues, necessitated by the state’s constitutional prohibition against dividend-type state tax treatments. And what doomed the proposal was opposition from climate hawks who took umbrage at being leapfrogged politically, and in revenge brought in lefty heavy hitters to slime the measure. But that’s another story.

Huge hat tip to friend of CTC Drew Keeling for Swiss materials and perspective. Drew’s most recent Carbon Tax Center post, Rural disgruntlement, pro-climate complacency sink expansion of Swiss carbon tax, appeared in June 2021.

Why the Carbon Tax Center Questions the Latest Carbon Tax Talk

September 27, 2021 By Charles Komanoff

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.

Let’s Blow Up Luxury Carbon

July 22, 2021 By Christopher Ketcham

It’s not often you hear the New York Times opining on the value of industrial sabotage, yet columnist Ezra Klein last week did just that, posting a column that began: “I spent the weekend reading a book I wasn’t entirely comfortable being seen with in public. Andreas Malm’s ‘How to Blow Up a Pipeline’ is only slightly inaptly named. You won’t find, anywhere inside, instructions on sabotaging energy infrastructure. A truer title would be ‘Why to Blow Up a Pipeline.’ On this, Malm’s case is straightforward: Because nothing else has worked.”

Ahr valley town of Bad Neuenahr-Ahrweiler, Germany, July 16, 2021, hours after Ezra Klein’s NYT post went up. Image from video by @AnthonyQuintano.

Malm makes the case for grassroots-organized destruction of the property of energy companies to raise the cost of their doing business and to punish fossil investors. More importantly, he advocates also for sabotage of the property of the very wealthy, whose outsize carbon footprint adds extra layers of class-based culpability in the unfolding crimes against humanity which climate change already constitutes, not in some hazy future but today.

Klein, however, cannot abide property destruction, and therefore Malm is dismissed, from the pulpit of the Times to all the listening world, as “trying to make eco-terrorism a thing.”

So what’s the news here? New York Times opinion columnist not comfortable being seen with book that advocates blowing sh** up? Klein is only comfortable enough to make sure the book is shrugged off and no one bothers to read it. That’s a grave public disservice at a time when the status quo is untenable, when business-as-usual -– a heedless headlong plunge toward catastrophe -– demands demolition.

To his credit, Malm, an author and professor at Lund University in Sweden, recognizes the limits but also the absolute need of radicalism to meet an ecological crisis that over the long term will likely be an existential one for industrial Homo sapiens: “The question is not if sabotage from a militant wing of the climate movement will solve the crisis on its own –- clearly a pipe dream –- but if the disruptive commotion necessary for shaking business-as-usual out of the ruts can come about without it. It would seem foolhardy to trust in its absence and stick to tactics for normal times.”

Look again at the history of well-intentioned, sometimes visionary people sticking to tactics for normal times and having no effect on carbon emissions. It is indeed distressingly accurate that nothing has worked: Not endless meetings at COPs 1 through 25 (maybe something will happen at meetings 26 through 50); not the IPCC’s increasingly panicked reports of warming to come and warming already here; not Greta Thunberg’s agonized despair, and not the schoolchildren by the millions abandoning class to follow her lead; not Bill McKibben’s earnest plodding entreaties; not the shutdowns of London by the massed peaceful disrupters of Extinction Rebellion (XR); not the broader peaceful protests inspired by XR and others during 2019, before COVID cancelled crowds everywhere; not endless entreaties to a swing-vote U.S. senator who, The Guardian revealed the other day, owns millions in coal stocks; not the known and accepted fact that we are now headed for a 3ᵒC-degree warmed world, which will produce terrestrial hellscapes with dire consequences for global society, starting with mass migrations and moving into mass die-offs.

No, emissions continue to rise, the climate continues to fracture, while ecosystems, whose pillage is separate but related to the saturation of the carbon sink, spiral into chaotic dissolution and the silences of extirpated and probably soon to be extinguished species.

The hour is late, the window for action is closing. What’s needed is widespread disruption of the intolerable status quo. So what kind and how much?

For Malm, nothing is off the table.

Verso Books, Brooklyn, NY (2021).

It is a “virtue,” he writes, that groups like XR and others such as Germany-based Ende Gelände (“This far and no further”) commit to non-violent civil disobedience to challenge business-as-usual “by means of ever bigger, bolder mass actions.”

“Let a hundred Ende Gelände camps bloom and fossil capital might find itself under some real pressure,” Malm enthuses. But his interrogation of the climate movement asks us to go beyond absolute nonviolence as “forever the sole admissible tactic in the struggle to abolish fossil fuels.”

In marshaling the argument for ecosabotage in defense of a ecologically healthy liveable earth, Malm quotes British novelist and essayist John Lanchester on the matter of defacing automotive grotesqueries:

In cities, SUVs are loathed by everyone except the people who drive them; and in a city the size of London, a few dozen people could in a short space of time make the ownership of these cars effectively impossible, just by running keys down the side of them, at a cost to the owner of several thousand pounds a time. Say fifty people vandalising four cars each every night for a month: six thousand trashed SUVs in a month and the Chelsea tractors would soon be disappearing from our streets. So why don’t these things happen?

Lanchester wondered then, in 2007, if it was because “people who feel strongly about climate change are simply too nice, too educated, to do anything of the sort.” And then circles the target, asking if it’s because “even the people who feel most strongly about climate change on some level can’t quite bring themselves to believe in it.” To which we can add that in a society in which the dominant mindset declares inanimate objects to be sacred totems, you face a lot of trouble when you dare to deface them.

Consider the example of the strong feelings of the suffragettes of England, whose ferocity against inanimate objects is inspiration to Malm. “Militancy was at the core of suffragette identity,” he writes, and at the core of militancy was property destruction. Emmeline Pankhurst, co-founder of the Women’s Social and Political Union, specialized in the “argument of the broken pane,” sending her enraged crews of well-dressed women into central London, bringing it to a standstill as they shattered the storefronts of dozens of businesses – jewelers, silversmiths, toy shops – and elsewhere attacked statues and paintings with hammers and axes. They planted bombs, fought policemen in street melees.

“Such deeds,” observes Malm, “went hand in hand with mass mobilization… The suffragettes [deployed] the gamut of non-violent and militant action.” After 1913, following defeat of legislation in England to give them the vote, they engaged in “a systematic campaign of arson,” burning or blowing up “villas, tea pavilions, boathouses, hotels, haystacks, churches, post offices, aqueducts, theatres…” They burned cars and sank yachts. Over the course of a year and a half, the WSPU lay claim to at least 337 attacks.

According to Malm, no lives were lost, as the suffragettes “took great pains to avoid injuring people.” Pankhurst considered the situation so urgent – the need for women to have the vote so important – that “we had to discredit the Government and Parliament in the eyes of the world; we had to spoil English sports, hurt businesses, destroy valuable property… upset the whole orderly conduct of life.”

Pic by John Hendricks, Oregon Office of State Fire Marshal, July 17, 2021 via Associated Press, courtesy New York Times.

A problem with upsetting the orderly conduct of life with attacks on fossil fuel infrastructure in the developed world – one of the two prongs of sabotage that Malm advocates – is that it threatens to disproportionately punish those who can least afford it: poor and middle class fuel oil and gasoline consumers.

This was one of the main objections from Ezra Klein, who noted, not incorrectly, that “the consequence of a wave of bombings to obliterate energy infrastructure would be to raise the price on energy immediately [and] the burdens would fall heaviest on the poor.” (Higher energy prices from a carbon tax whose revenues are returned to the neediest and hardest hit as a dividend is a different story -– the telling of which is a raison d’être of the Carbon Tax Center.)

I suggest that Malm’s more tantalizing project, because politically it is more feasible, is for saboteurs to strike at the absurd, obscene carbon gorging of elites -– to disrupt unnecessary luxury demand that could be cut off with no pain to people who already have too much. “If we have to cut emissions now,” he argues, “we have to start with the rich.”

Malm cites the pivotal distinction, formulated by philosopher Henry Shue, between luxury and subsistence emissions: “The former happen because rich people like to wallow in the pleasure of their rank, the latter because poor people try to survive.” Peasants in India using coal to cook bread or at night getting the dim light from a dying bulb fed by a coal-fired power plant are confined in their choices because the alternative for poor people locked in the fossil economy, as Malm bluntly explains, “might be no stove and no lamp.”

The rich man on his yacht, on the other hand, has the opportunity to scrap the yacht and cease his profligacy and waste, but chooses not to. This wanton disregard is aggravated by the fact that the hypermobility of the rich “is what frees them from having to bother with the consequences, as they can always shift to safer locations. To be super-rich and hypermobile above 400 ppm,” Malm notes, “is to dump lethal hazards on others and get away from them in one master stroke.”

As it happens, we have data on the carbon footprint of the global fleet of 300 superyachts, defined as boats longer than 24 metres and affordable only to an estimated 0.0027 percent of humanity. In a single year, the fleet generates as much CO2 as the ten million inhabitants of Burundi.

Somewhat more broadly, the richest one percent of the world’s people were responsible for 15 percent of the emissions added to the atmosphere between 1990 and 2015, according to Oxfam’s Confronting Carbon Inequality report released last year. To be superrich is to have the yacht, of course, and luxury cars with gas-guzzling engines, and multiple SUVs, and mansions in multiple countries, and jets, helicopters, sometimes private airports, sometimes private submarines. Malm declares them all targets ripe for sabotage. And because of their outsize footprint, destruction of rich people’s property isn’t just symbolic – though symbolism matters, of course. (Add to the target list, for example, the space vehicles of Bezos-Branson-Musk that merely announce how wondrous it is that elites are capable of wallowing in rank outside our atmosphere as much as in it.)

NYC subway entrance, July 8, 2021, during a 30-day period with over 10″ of rain, a record. Image from video by @PaulleeWR.

The most important symbolism in attacking carbon entitlement is in the context of any attempt by the rest of society at decarbonization. Luxury emissions, writes Malm, “represent the ideological spear of business-as-usual, not only maintaining but actively championing the most unsustainable kinds of consumption….Consumption in middling strata is patterned on it, the nouveau riche across the world scrambling to join the 0.0027 per cent.” It’s Thorstein Veblen’s dynamic of pecuniary emulation -– conspicuous display of luxury emissions leads to more emissions by others as display –- but writ on a global scale with the ultimate cost that the poorest members of humanity are flooded, drowned, starved, or burned out. Luxury emissions conspicuously displayed are at the same time “supremely demoralizing for mitigation efforts.” Here’s Malm:

Merely catching sight of a superyacht gliding through the estuary, or hearing about the latest record in private tower construction, or reading about the still-soaring sales figures for the most gas-guzzling cars on the market is enough to break anyone’s hope that we will ever bend the curve. If we cannot even get rid of the most preposterously unnecessary emissions, how are we going to begin moving towards zero? [emphasis original]

But then there’s the question of who is best situated to commit acts of property destruction? As a journalist, I’ve gotten to know a number of ecosaboteurs. I count them among my heroes because they had guts and daring, went out mostly alone into situations of terrible precarity, acted as their conscience directed them, hurt no living beings but wrecked a lot of property and cost millions to the corporations who owned the property.

They believed that as they acted, others would be inspired to join them. But this didn’t happen. Every one of these people ended up caught by authorities hell-bent on punishing the heinous offenders against the inanimate objects called property. They did time in state and federal cages. As of this writing, one of them sits in his cage at the tail end of nine years in the federal prison system for attempting, as he put it, to “end global warming” by attacking the “fossil fuel infrastructure system.”

As Lanchester described, the need is for a critical mass of saboteurs willing to take the risk. Malm’s book is a first attempt (there will be more soon, I expect) to rally citizens to that end. The key is that lots of people have to do it, at the same time, in numbers such as have never been seen. But let’s not soft-pedal, as I think Malm does, the crushing consequences of getting caught in acts of sabotage, the weight of the carceral state as it comes down on your head in a manner outrageously disproportionate to the damage you inflict on the system of protecting inanimate objects.

Things are worse today than in the age of the suffragettes –- property is more sacrosanct than ever. Your own life will be ruined if you even moderately violate that sacred realm. You will go to jail. You will be bankrupted with court costs and fees and fines of restitution. Your children will suffer, as they effectively lose a parent. Such heroism and sacrifice has to be mean something, and it won’t mean a thing if it’s not widely supported and emulated.

Christopher Ketcham is a free-lance journalist and author of This Land: How Cowboys, Capitalism, and Corruption Are Ruining the American West (Penguin Random House). He may be reached at christopher.ketcham99@gmail.com.

New Senate bill would price CO2 at $54/metric ton and tax some particulates, SO2, NOx

June 21, 2021 By Charles Komanoff

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).

Modeling by CTC suggests the Save Our Future Act will cut CO2 34% below 2005 levels in 10 years (without counting ancillary charges on PM-2.5, SO2 and NOx).

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.)

Revenue Treatment

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

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.

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Search Results for: revenue

Litigating for Climate

Montana litigation supporters weigh in

Banks and Climate

Coda

Biden’s Climate Change ‘Revolution’ Isn’t Coming.

Introduction

Biden’s Plan, Though Not Revolutionary, Was Bold.

Introduction

1. The climate deal that wasn’t

1. The long shadow of Washington state’s failed carbon tax referendum

2. A domestic defeat with global consequences

2. Goodbye to the myth of U.S. global leadership on climate

3. Where the politics of climate action go from here

3. The impasse at the abyss

1US Energy Information Administration, “Electric Power Monthly,” Table 1.14.B, “Utility Scale Facility Net Generation from Wind,” shows 4,522 GWh in New York State in 2020 and 4,387 GWh in 2021.

Q1: Is the backlash against high pump prices an argument against pursuing carbon taxes?

A1: No.

Q2: How big a hit are U.S. consumers taking from the higher fuel prices?

A2: A pretty big one, though it’s probably transitory.

Q3: Is gasoline use sensitive to the price at the pump?

A3: More than most people think, though less than we wish.

Q4: How much could the U.S. cut oil demand, right away?

A4: By a lot. (But we won’t.)

Switzerland

Canada

1. Congress can’t pass a carbon tax in 2021 anyway.

2. The carbon tax under discussion won’t protect enough ordinary Americans.

3. The carbon tax under discussion won’t generate big emission cuts.

4. Democratic backing for a carbon tax now will make it harder to defeat the climate-denying G.O.P. in the 2022 midterms.

What kind of carbon tax does the Carbon Tax Center want?

Pushing the Envelope

Revenue Treatment

Local Air Pollutants

Prospects

¹US Energy Information Administration, “Electric Power Monthly,” Table 1.14.B, “Utility Scale Facility Net Generation from Wind,” shows 4,522 GWh in New York State in 2020 and 4,387 GWh in 2021.