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Finding The Right Climate Plan

Finding The Right Climate PlanMultiple plans for fighting climate change are under debate at both the state and federal level. One Tufts economist urges discretion in weighing the options.

Medford/Somerville, Mass. [02.05.07] For observers concerned about addressing the growing problem of climate change, the plethora of plans currently under consideration in the White House, Congress and state legislatures across the nation should be encouraging news. But Tufts Professor of Economics Gilbert Metcalf says that there are many factors to consider when choosing the best approach.

"The public has long understood the need to reduce carbon emissions, and it is exciting to see politicians catching up," Metcalf wrote in an op-ed for The Boston Globe. "But the details matter, and it's vital to figure out which bills are worth supporting and which ones are just more hot air."

In the op-ed, Metcalf cited multiple plans to address climate change. At the federal level, he noted a call from President Bush in his State of the Union address for increased ethanol production and changes to federal fuel efficiency standards, two plans in the Senate for cutting carbon emissions and a newly formed Select Committee on Energy Independence and Global Warming in the House. According to Metcalf, there are also initiatives underway at the state level, including one in Massachusetts being led by Gov. Deval Patrick and another in California being headed by Gov. Arnold Schwarzenegger.

"Policymakers are also beginning to look more closely at a carbon tax," he added.

According to Metcalf, there are four main areas of concern: the complexity of the plan, the breadth of coverage, preventing the abuse of carbon permits and the use of revenue gained from energy-related taxes and permits.

Metcalf—an expert on applied public finance—believes that on the national level, a plan that targets the producers of carbon would be the easiest to execute since "production of carbon-based energy is concentrated." Under such a plan, these groups would need permits for their carbon production.

"When a system is too complex, policymakers are likely to throw up their hands and leave crucial sectors out," he wrote in the Globe.

Legislators should also consider the amount of carbon emissions addressed by a plan, Metcalf wrote.

"Does the plan cover a large fraction of carbon emissions?" he asked in his Globe op-ed. "If not, it unfairly burdens covered sectors while reducing the program's effectiveness."

Other concerns of Metcalf's are on what basis carbon permits will be allotted and whether or not the revenue gained from auctioning these permits should automatically be redirected into energy initiatives over other state budget needs.

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