AEI Proposes Carbon Tax With Brookings and Breakthrough Institute
AEI has released a paper titled "Post-Partisan Power" which includes a section discussing a carbon tax:
4. Internalize Cost of Program in Several Ways Including Low Price on Carbon
All told, this framework would cost between $15 and $25 billion per year, less than one-third what we spend on defense research alone. While defense and health research are paid for through general revenues, the cost of a major national commitment to energy innovation ought to be internalized within America's energy economy. This could be accomplished in any number of ways:
Phase out current subsidies for wind, solar, and fossil fuels alike, which have not created sufficiently strong incentives for innovation and price declines.
Increase the royalties we charge oil and gas companies.
Dedicate revenues from a modest carbon price to finance the necessary investments in clean energy technology. A $5 per ton tax on carbon, about a third of what recent proposed cap and trade legislation would have cost consumers and businesses, would be more than sufficient to pay for an ambitious federal clean energy research, development, and procurement program.
Tailor different approaches to different sectors of America's energy economy rather than seeking a one-size-fits all approach.
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