CRS InFocus Report: 'A Brief Comparison of Two Climate Change Mitigation Approaches: Cap-and-Trade and Carbon Tax (or Fee)'

From Jonathan L. Ramseur comes this CRS InFocus report (updated 12 January 2021): A Brief Comparison of Two Climate Change Mitigation Approaches: Cap-and-Trade and Carbon Tax (or Fee)'.

The graphic is from EPA.

Download CRS_InFocus_Report_Comparison_CC_Mitigation_12January2021

Overview
Almost all climate scientists agree that greenhouse gas (GHG) emission increases have contributed to observed climate change and that continued increases in GHG emissions will contribute to future climate change. Although a variety of efforts seeking to reduce GHG emissions are currently underway on the international level and in individual states or regional partnerships, federal policymakers and stakeholders have different viewpoints over what to do—if anything—about GHG emissions, future climate change, and related impacts.

For policymakers considering actions to reduce GHG emissions, various policy options are available. Over the last 15 years, many of the legislative proposals have involved market-based approaches, such as a GHG emissions cap-and-trade system or a carbon tax or emissions fee. These particular approaches may be considered in the 117th Congress and are discussed below. The information below provides an overview of two approaches while briefly addressing their similarities and differences.

Cutting to the chase....

Concluding Observations
Discussions of cap-and-trade and carbon tax approaches often center on their potential advantages in terms of emissions uncertainty and price uncertainty, respectively. The degree to which one approach has an advantage in a particular context, such as transparency or administration, would depend on the designs of the programs being assessed. In many cases, these differences may be addressed with specific design elements.

Although recent attention has largely focused on market- based mechanisms, policymakers can address emissions with other policy tools, including performance-based regulations, which currently apply to motor vehicle emissions, or promotion of mitigation technologies, such as carbon capture and sequestration. These tools could support market-based programs or function independently.

Enjoy!

"Progress moves at the speed of trust." - Unknown

Comments

[EJ Hanford, PhD.]

"Almost all climate scientists agree that greenhouse gas (GHG) emission increases have contributed to observed climate change and that continued increases in GHG emissions will contribute to future climate change."
NOT all scientists agree - the 97% consensus that has been bandied about was derived from a survey of published papers: 97% of authors of roughly 700 paper. Note: one may not get published if one disagrees with the prevailing ideology.
Cap & Trade has has some success for air pollution -- https://www.resourcesmag.org/archives/learning-thirty-years-cap-trade/
but, caveats apply since such policy can be strongly politically influenced.
Of course, carbon pricing depends on the assumption that carbon dioxide is the culprit -- but what about developing a better understanding of the global carbon cycle and deleting the political process?