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Flaw in UN Climate Report: China, India Will Never Impose Carbon Tax on Themselves

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Flaw in UN Climate Report: China, India Will Never Impose Carbon Tax on Themselves

The Hill October 26, 2018
Energy & EnvironmentGeopoliticsRegulations

The latest report from the United Nations Intergovernmental Panel on Climate Change (IPCC) calls for drastic action to limit global warming to less than 1.5 degrees Celsius. The report urges the imposition of enormous carbon taxes — as high as $5,500 per ton by 2030 and a staggering $27,000 per ton by the year 2100.

The IPCC now joins a long list of U.S. carbon-tax proponents on both the right and the left.

While there’s plenty of debate about the merits of a carbon tax, little attention has been paid to a key question: Would it have any impact on world climate? Given the continuing growth in global coal consumption, the short answer to that question is a resounding “no.”

Moreover, the IPCC report states clearly that limiting global warming to less than 1.5 degrees Celsius (2.7 degrees Fahrenheit) would require cooperation on the part of global leaders for which there is “no documented historical precedent.”

Sadly, that degree of global cooperation — regardless of U.S. fossil fuel consumption or a newly implemented carbon tax — is little more than a pipedream.

Three decades ago, coal-fired power plants produced 38 percent of the world’s electricity or about 3,700 terawatt-hours (TWh) per year. Despite the growth in natural gas to generate power and the push for wind and solar, by 2017, according to data published in the 2018 BP Statistical Review of World Energy, global coal-fired electricity generation had more than doubled to over 9,700 TWh in 2017, with an increase in global consumption that accounts for over 40 percent of total world generation. (By comparison, in 2017 total U.S. electric generation was around 3,900 TWh from all generating resources.)

In the U.S., over the past decade coal-fired generation fell by a whopping 40 percent: from 2,000 TWh in 2007 to just 1,200 TWh in 2017. And that happened without a carbon tax.

But when it comes to meeting the world’s growing hunger for electricity, coal is still king. In 2017 alone, world electricity generation increased by 630 TWh — more than the total combined electricity consumption of California and Texas.

As countries increasingly electrify their economies, coal continues to be the resource of choice. Over the last decade, coal generation increased by 1,500 TWh.

The U.S. doesn’t need a carbon tax. And even if it imposed one, it wouldn’t make a difference to global climate. Let’s look again at the numbers. In 2017, U.S. carbon emissions were around 5,100 billion metric tons from all sources, an almost 20 percent drop below emissions in 2007.

While U.S. greenhouse-gas emissions have been falling in recent years, world carbon emissions keep increasing: by an average of more than 300 gigatons each year for the last decade, driven primarily by China’s and India’s increasing demand for energy. Together, those two countries now account for one-third of world carbon emissions.

China and India are not going to impose a carbon tax on themselves. Doing so would increase their energy costs and reduce their economic growth. Neither will Russia, nor countries in the Middle East, nor developing nations whose primary concern is improving the economic well-being of their citizens, regardless of the IPCC’s demands.

As for countries that have imposed carbon taxes on themselves, the economic results have been disastrous. Australia rescinded its carbon taxafter massive public outcry, which led to a change in government. Britain’s carbon tax is hated, and its subsidies for wind and solar power, like those in Germany and Spain, have led to soaring electricity prices, increased energy poverty, and reduced industrial competitiveness.

Look north to Canada: In British Columbia, the province’s much-ballyhooed “revenue-neutral” carbon tax not only has failed to reduce emissions by anywhere close to the 33 percent reduction goal by 2020.

Were the U.S. to impose a carbon tax it would have no detectable impact on global temperatures or climate.

The world will not soon abandon coal, petroleum or natural gas. Given current technology, wind and solar power cannot possibly meet the world’s rapidly growing appetite for energy. For the U.S. to self-impose a carbon tax and expect it to benefit the climate would be the height of economic and environmental folly.

This piece originally appeared at The Hill


Jonathan Lesser is the president of Continental Economics and an adjunct fellow with the Manhattan Institute.