Automating Google Workspace (GWS) & more with Apps Script
Carbon Tax vs Cap-and-Trade: Which Approach is Better
1. Carbon tax vs. Cap-
and-Trade: which is
better?
A presentation by Angel-Avocado
and Nami-Nutella
2. Carbon Tax
• Carbon tax is a form of pollution tax. A fee for
greenhouse gas pollution.
• The government sets a price per ton on
carbon, then translates it into a tax.
• Tax makes using dirty fuels more- expensive.
• Encourages businesses and individuals to
reduce consumption and increase energy
efficiency.
• Adopting to greener practices.
3. Cap and Trade
• Sets a cap, and distributes emissions permits
among firms that produce emissions.
• The emission cap ensures that total pollution
goes down
• Companies are given an economic incentive to
find better ways to reduce greenhouse gas
and support clean energy.
• more complex
5. Advantages
Carbon Tax:
• encourages alternative energy.
• more predictable and stable.
• incentive to use/develop more environmentally
friendly production processes.
• Quick to implement
Cap and Trade:
• More effective/complex approach.
• Fewer political obstacles than tax
6. Disadvantages
Carbon Tax:
• Production shift to countries with no or lower carbon
taxes (China)
• Firms may hide the real carbon emissions so they can
pay less.
• Difficult to measure how much carbon is produced.
Cap and Trade:
• Emissions are capped, but the dollar price is unknown
and dependent on many market variables.
• Everybody has to be involved otherwise some
businesses may loose their competitive advantage!
8. Solution
How can we reduce pollution and other
externalities that are caused through market
mechanisms?
• Harmonized international carbon price. (Fair)
• Allowance prices automatically adjust to
economic conditions.
• Use alternative Energy.
• Think outside the box!
