Photo by Nik Shuliahin on Unsplash

What do we want from carbon policy? Internalizing pollution’s external costs even though that may not incent a polluter to abate? Or, mandating reductions and attacking emissions head on? These two options are not merely opposite sides of the same coin. They demonstrate the gulf between liberal and traditional conservative thought.

In my second carbon policy article describing Market Driven Compliance, I reserved until now the philosophy for choosing an intensity-based cap and trade over a tax. This article approaches that choice as one between liberal and conservative values; between unbounded and unquestioning faith in the ability, indeed, the obligation…


So true. It seems the Biden proposal and the GND climate track are throwing a lot of money at the wall hoping most of it sticks. The "more" that is needed is a consistent regulatory policy setting a common goal for climate performance across the entire economy rather than for one sector at a time. A truly market based policy will set a single performance standard or expectation for all polluters and value emission reductions and offsets. If the expectation is exceeded, the over compliance will have market value. If the expectation is not met, the polluter must find a solution elsewhere in the market. If we want risk-taking on carbon reductions to have the highest reward ratio, markets are very efficient in that regard. There is a good chance money thrown on the wall will not be the most direct path to necessary emission reductions.


Ken, I browsed some of the REP papers and read your article on Gates. You write well. I think the social cost of carbon is a distraction. I suspect you agree. You and I both seem to focus on paying for abatement, not for emissions. If a social cost of carbon tax is 20 $/MT but a polluter's abatement cost is 40 $/MT, we have gained nothing except manipulation of consumer demand.

I must admit much of the math in the REP articles is beyond me. The basic concept, however, does have appeal - charge for tonnes emitted and rebate…


In “Seven Reasons Why Taxing Carbon Won’t Fly (and shouldn’t)” I listed objections to a carbon tax and committed to describing a better, property-based carbon policy. Here are the how, who, what, where, and when of that policy. I start with “How.” “Why” is reserved for the third and last article in this series.

How. The policy is called Market Driven Compliance. MDC is an intensity-based emissions trading scheme, a cap and trade modeled after EPA’s averaging, banking and trading or ABT programs successfully controlling sulfur and benzene in gasoline and diesel for decades. Unlike other cap and trade structures…


In my earlier post, Seven Reasons Why Taxing Carbon Won’t Fly (and shouldn’t), I promised a second installment describing a good carbon policy that is not a carbon tax. For the sake of keeping each article readable, the second installment has evolved into a second and a third installment. The second will be published soon. While working on these articles, I want to share one fundamental reason why I find anthropogenic climate change a totally believable concept.

While believers and deniers argue about such things as whether CO2 is really good for plant life and, therefore, good for the planet…


Pricing is considered the best policy for reducing carbon emissions, and carbon taxation monopolizes the conversation. To be sure, a carbon tax will reduce emissions; we get less of anything we tax. The tax, however, has serious drawbacks worth discussing since other carbon pricing options are available. Adopting a carbon tax will, I fear, damage public confidence in government, which cannot afford further setbacks. We will likely have just one bite at the carbon policy apple. Do-overs may not be an option. This article lists seven flaws of taxing carbon.

A goal of environmental policy is creating order from chaos…

Bob Neufeld

Retired environmental compliance and government relations vice president for a small petroleum refiner. I have degrees in chemical engineering and law.

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