Carbon Fee and Dividend: Why it will work

As long as fossil fuels remain cheap the use of them will continue at the peril of breaching one or more of the thresholds of physical stability that govern the biosphere.

The Citizen’s Climate Lobby (CCL) has developed the policy of a carbon fee and dividend to internalize the costs of fossil fuels and provide the impetus to move toward carbon-free emissions. Here is how it would work:

  1. Place a steadily rising fee on the CO2 content of fossil fuels.

  2. Give all of the revenue from the carbon fee back to households.

  3. Border adjustments ensure fairness and competition.

  4. It’s good for the economy AND even better for the climate.

The producers and largest consumers of fossil fuels will have an incentive to move to alternative fuels. Citizens will receive a dividend check each year as the fees are redistributed to the public. That will put the money back into the economy while creating the incentive for producers of energy to move to other sources of energy that are carbon free.

Fees will be collected on the annual tax return each year.

 

 

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