27052011

Carbon Tax does not work

New Jersey in the US has just decided to pull out of their Cap and Trade scheme, to quote:

The 10-state Regional Greenhouse Gas Initiative, a cap-and- trade program that regulates carbon-dioxide emissions, is “nothing more than a tax on electricity, a tax on our residents and on businesses with no discernible effect on our environment,” Christie, a 48-year-old Republican, told reporters in Trenton today.

“We remain completely committed to the idea that we have a responsibility to make the environment of our state and world better,” Christie said. “We’re not going to do it by participating in gimmicky programs that don’t work.”

Basically the Cap and Trade scheme requires power plants to pay for carbon dioxide released from their smokestacks. Does this sound rather familiar to what is proposed in Australia with the Carbon Tax?

Carbon Tax does not work..

Put simply, Carbon in of itself has no real value, its one of the most abundant substances on this planet. Combine this with the fact that governments seem to be quite happy to interfere with the carbon market by flooding it with 'solar multipliers' and the like; and you have recipe for long term price instability. basically in the US carbon trades at around $2 a tonne, not $20 or $40, just $2.

Then if you factor in that it is actually darn hard to work out what the Co2 emissions (or equivalents) are, and the fact that most of this is paper based accounting; and you have an environment that encourages market manipulation - for instance the EU market is known to have organized crime involved in it.

In essence if its difficult to measure Co2, and it has no real value, its darn hard to set up an actual 'real' market in it - therefore its ripe for manipulation and fraud. So therefore setting up a Carbon Tax on top of such a 'mess' is not going to work.

Carbon is not the problem

Every life form on this planet uses Carbon and Carbon Dioxide in its life processes. For instance animals produce Co2 as they breath and plants consume Co2 to produce oxygen which the life forms then breath in and use. Did you know that we are at a long term historical low on Co2 in the atmosphere?  See the graph below going back millions of years.

Also look at the past few thousand years.

Also did you notice anything strange on that last graph, yes a change in temperature quite often proceeds a change in Co2 levels - looks a lot like temperature is driving Co2...

So what about the increasing temperature we are having?  Actually we are not..

The temperature is cycling down again, yet we have a Co2 concentration at 390ppm, up from 270ppm around 100 years ago - things that make you go hmmm.. In fact it looks like the solar energy cycle (often termed the Sun Spot cycle) has a lot to do with this as we are entering into a possible solar minimum - the last time this happened in the 1800's rivers frozen over in Europe and crops failed on mass.



BTW if the Co2 concentration drops below 150ppm, plants are no longer able to function - so do you really want the Co2 levels to go any lower?

So whats the climate effect of the tax?

Australia as a whole contributes about 1.5% to global man made Co2 emissions, the Carbon Tax will reduce Australian Co2 emissions by 5% by 2020 - this action will result in a drop of temperature by 0.00007 of a degree for a total cost of $127 billion over the period...  Thats an awful lot of money for very little to show for it (if you can even measure it!).

In conclusion

Taxing Co2 and its equivalents through a Carbon Tax is not the answer, the taxation does not work and reducing Co2 will do nothing (temperature appears to drive Co2) - so just say NO. Instead do the following:

• Reduce your impact on your local environment; i.e. clean up and recycle;
• Contact your MP and ask them to support increased investment in future technologies (like high efficiency solar and fusion);
• Look at passive ways of reducing your energy needs in your house (i.e. better insulation, passive solar, etc).
• Talk to your friends and refer them to this article.

Basically I consider the current Carbon Tax to a rather ineffective and expensive exercise in political power play - without the Greens holding the balance of power in Australia it would never have occurred.