Legislation Cap & Trade Taxation Nightmare

Legislation to address global warming runs the risk of turning a potential environmental catastrophe into an expensive economic nightmare!

Government’s are looking to unilaterally and cost-effectively make significant changes in the Earth’s climate and in their desire to have legislation.

One recognizes that given the proposed environmental benefits (required environmental benefits if life is to sustained on planet Earth!) and expensive solutions, any action taken to address global warming will certainly increase the cost of electricity and other goods and services we use every day.  At any rate this is conventional thinking.

Commonly muted, governments may impose cap-and-trade programs to limit carbon emissions. Cap-and-trade systems work by setting a specific limit on airborne pollutants from sources like power plants, factories, refineries and any other business or source exceeding prescribed limits and requiring those sources to account for all emissions with issued allowances.

However, some cap-and-trade proposals for carbon dioxide contain a new twist: requiring existing businesses and other pollution sources to buy allowances known in the EEC as Carbon Quotas.

Allowances like those proposed in the US model would be auctioned, leading to huge cost burdens for any source of carbon dioxide emissions (the Australian model would hand out Quotas for free to carbon polluters). In the case of US power plants, those auction costs of obtaining Quotas raise uncertainty of what costs would be and would ultimately be passed on to consumers using the power. The public would experience varying rates of power costs depending on the proportion of Carbon emitted by their local Power Plants depending on the fuel used and its carbon burnout properties.

The economic impact of these costs is found not only in electricity but also in the increased cost of goods and services that use electricity.

Obviously the auctioning of Allowances and Quotas would establish a substantial source of revenue for the federal government which turns the initial environmental argument for regulating carbon dioxide to sustain life into a source of government revenue. This becomes a backdoor tax increase that would essentially force electric utilities to become tax collectors.  This viewpoint turns an environmental problem into an economic nightmare.

Much work is being done to develop new technologies to reduce carbon dioxide emissions from power plants, but those options are limited, largely untested and in the case of Carbon Capture and Storage (CCS) expensive. Yet potential legislation could create the choice between two evils: either be subject to the volatility of an auctions market and Carbon Exchanges or make huge capital investments in unproven technology to capture and store CO2.

Our approach has been to work on an energy solution that tries to accomplish environmental goals while taking affordability into account.  And our Black Box technology actually does reduce CO2 emissions, something Carbon Capture and Storage does not even attempt.  Refer to our Know-how and Black Box Co2 Emission Reduction Device click here