Toward Zero-Carbon NYC Full-cost pricing of CO 2 (carbon tax) Full-cost pricing of driving...

Toward Zero-Carbon NYC• Full-cost pricing of CO2 (carbon tax)

• Full-cost pricing of driving– “Cordon” pricing

– “Area-wide” road pricing

– Curb space priced for 15% vacancy rate

• Embrace wind power

• Unbundled + real-time electricity metering

• Community-based energy efficiency

• Conservation arbitrage with Upstate NY

Carbon Tax Basics• Taxing “bads” > subsidizing “goods”• Global metric (unlike cap-trade) • Clear price signals (ditto)• Distribute revenues pro rata (Alaska)• Border Tax Adjustments• Polluters Pay• As “dynamic” as capitalism• Necessary, not sufficient

Carbon Tax Proportions

0

1

2

Relative taxrate per btu

Gas

Oil

Coal

Fuels are taxed by carbon content per btu

Price has fallen in 30 (44%) of past 68 months

Demand for gasoline is price-elastic2008 v. 2007 (six months ea.)

Usage: 9,021 mbd v. 9,209, ↓ 2.0%

GDP: ↑ 2.3%, → [Gasoline ↑ 1.6%]

Usage “shortfall”: = 1.6% + 2.0% = 3.6%

Price: $3.48 v. $2.75, ↑ 22% “real”

Elasticity (short-run): 3.6%/22%, ≈ 0.17

Elasticity (long-run): we assume 0.40

A Carbon Tax “Path”

• $37 / ton of carbon ( ≈ $10 / ton of CO2)

≈ 10¢ / gallon of gasoline, jet fuel, etc.

≈ 0.72 ¢ / kWh (U.S. retail average)

• Reduces U.S. CO2 emissions ~ 4%

• Repeat > 10 years (while standards

and incentives also cut emissions)

Life with a Carbon Tax

EnergyEnergy• Coal-fired generation Coal-fired generation downdown• Wind and other renewable generation Wind and other renewable generation upup• Incandescents / halogens Incandescents / halogens outout, CFL’s / LED’s , CFL’s / LED’s inin• Nukes Nukes upup??

Transportation and Land-UseTransportation and Land-Use• SUVs SUVs outout, sedans , sedans inin• Costlier air and highway travel creates marketCostlier air and highway travel creates market pull for VGT-quality intercity railpull for VGT-quality intercity rail• Urban trips by bicycle up 10x, to 10%Urban trips by bicycle up 10x, to 10%• Urban revitalizationUrban revitalization

Who Supports a Carbon Tax?• Former V-P Al Gore

• Mayor Michael Bloomberg

• NASA climatologist James Hansen

• Most academic economists and many “public” ones on left and right

• Friends of the Earth

• Growing cadre in U.S. Congress

Full-cost pricing of driving

For New Yorkers to

accept something as

transformational as

paying to drive on “free”

roads and streets, they

need to receive a

benefit that is equally or

more transformational:

free transit (Kheel Plan)

“There is nothing more difficult to

take in hand than to take the lead in

the introduction of a new order of

things ... the innovator has for

enemies all those who have done

well under the old conditions, and

lukewarm defenders in those who

may do well under the new.”

— Niccolo Machiavelli,

The Prince, 1513

NJ Offshore Wind Farm – The View

(NYC needs ~ 7,500 for 100% of kWh)

“To see these giant towers near

your house – it would be like

driving through oil derricks to get

to your front door.”

— Retired ABC-TV exec with 65 hilltop

acres in upstate Cherry Valley, NY Times,

“Windmills on Their Minds,” Aug. 28, 2002

Toward Zero-Carbon NYC• Full-cost pricing of CO2 (carbon tax)

• Full-cost pricing of driving– “Cordon” pricing

– “Area-wide” road pricing

– Curb space priced for 15% vacancy rate

• Embrace wind power

• Unbundled + real-time electricity metering

• Community-based energy efficiency

• “Conservation arbitrage” with Upstate NY

A NYC energy-

efficiency

failure:

Manhattan

Community

Board 3 lets the

clock run out

On “Greening

A Block”

The bicycle offers the gains of

advanced technology without

threatening the environment. It

stands not only for undamaged

nature but also for unbroken

autonomy. To attack the pedals

may be strenuous over the short

run, but it is an expression of

trust in one’s own powers, for

with the bicycle everything

depends on the self.

— Wolfgang Sachs

Web sites

• www.carbontax.org

• www.komanoff.net– http://www.komanoff.net/wind_power/

– http://www.komanoff.net/oil_9_11/

– http://www.komanoff.net/fossil/

– http://www.komanoff.net/nuclear_power/

• www.kheelplan.org

• www.streetsblog.org