The FeeBate Debate

The best way to deal with global warming is a FeeBate policy. This works fast and effectively, is ideology- and budget-neutral and has the least risk of feeding a wasteful bureaucracy.

In essence, a Greenhouse Gases FeeBate policy will impose a fee on products that cause emissions of greenhouse gases, while the proceeds of these fees will in each case be used to help better alternatives, in the form of rebates.

In many respects, markets are best suited to work out which products and technologies should get support through rebates - the main criteria should be that they are replacements for the item that attracted the fee, that they are safe and that they cause little or no emissions of greenhouse gases, or - even better - that they are greenhouse gas negative.

The FeeBate policy should be adopted globally, but executed locally; levels of fees and rebates can be adjusted on an annual basis, depending on how successfully the shift takes place. Fees can be collected on items that are sold locally, or - if necessary - fees can be imposed on imported items.

The FeeBate policy that I propose includes:

• a fee of 10% on sales of new cars with internal combustion engines, with proceeds used to fund rebates for electric cars
• a fee of 10% on sales of gasoline, with proceeds used to fund rebates on purchases and installation of facilities that produce renewable energy
• a fee of 10% on sales of coal, with rebates given when electricity suppliers install facilities that produce electricity from renewable sources
• a fee of 10% on building and construction work using concrete that contributes to global warming, with proceeds used to fund rebates on buildings that used clean concrete
• a fee of 10% on sales of fertilizers, with rebates on sales of agrichar, which is produced by means of pyrolysis from various forms of biowaste
• a fee of 10% on sales of meat, with rebates and vouchers for alternative food (my personal favorite: vegan-organic food served in restaurants in communities without roads)

Tax greenhouse gas emissions!

The quickest and most effective way to deal with global warming is to tax greenhouse gas emissions and to spend the proceeds to encourage the use of renewable energy locally.

Tax puts a price on pollution and, in combination with a reward for those who avoid pollution, it establishes market mechanisms that encourage efficiency, innovation and technological progress.

It is also the quickest way to combat global warming - a tax will immediately discourage pollution, whereas other policies may allow the rich to continue polluting, e.g. by paying the poor in developing and over-populated countries where people will be inclined to use that money to mimic the lifestyle of the rich, leading only to more pollution.

Instead of taxing the rich and handing the money over to the poor, as in the old socialist motto, we should adopt a new motto, i.e. tax energy suppliers who pollute and give it to suppliers who don't.

By taxing pollution and spending the proceeds on rewards for clean and renewable energy, the policy is doubly effective.

Spending the proceeds locally ensures that they are used where they have the most impact, as the biggest markets for energy will receive the biggest incentives to shift away from pollution.

Should greenhouse gas emissions be taxed and should those tax proceeds be used to encourage the use of renewable energy locally?