WASHINGTON, D.C. –(ENEWSPF)—August 4, 2015. Yesterday, the Environmental Protection Agency finalized a rule to reduce carbon pollution from existing power plants, under the Clean Air Act. The final rule has explicitly allowed a carbon tax as a means of complying with the Clean Power Plan (p. 899). If states do decide to adopt a carbon tax as their compliance mechanism, they will also need to put forward a back-up option in case their primary plan does not result in the promised emissions reductions. This requirement also applies to other measures, such as a renewable portfolio standard.
A carbon tax could match or even exceed the EPA’s emission reduction targets as supported by data from the Energy Information Agency (pp. ES-5, MT-34). In order to accomplish this, the price must be meaningful and rise over time. Stanford University, Brookings Institution, Friends of the Earth, R Street Institute and others submitted joint comments to the EPA advocating for a carbon tax in the final Clean Power Plan.
Friends of the Earth Climate and Energy Campaigner Kate DeAngelis issued the following statement in response to the final rule:
There is broad support for a carbon tax across the political spectrum to help combat climate disruption. We are pleased that the EPA chose to allow a carbon tax in its final existing power plant rule. Analysis from economists as well as government data has shown that a carbon tax is an effective and efficient means of achieving greenhouse gas reductions. If a state chooses to implement a carbon tax, it will create momentum for a national carbon tax. A robust carbon tax is an important mechanism the U.S. should use to achieve the reductions necessary to avert the worst impacts of climate disruption.
Speaker Boehner on President Obama’s National Energy Tax