The "EU Emissions Trading Scheme" turned into a failure, because the energy consumption went down and with it the demand to obtain permits. On the other hand industries attempted to increase their turnover selling the unused permits to other companies. What is more, the green energy projects have spotted producing the desires effect.
The author is asking what would be an adequate price for the carbon emissions. NASA climate scientist observes that for him proposing the right cost will determinate if we as humans can cope with the irreversible climate changes that we have caused. The author comments that there are numerous ways to put a value on carbon. One of them is to calculate what will be the cost per tonne to diminish the emissions. Another approach is "the social cost of carbon". This method estimates the damage price to the atmosphere for a lifetime. The World Bank conducted experiments with this method as well as Dutch government and UK treasury. However, they all variable are taken into consideration the estimation tremendously vary from 35 GBP to 140 GBP per tonne.
Another technique is the "shadow price of carbon". This one estimates factors like willingness to pay for the reduction of carbon emissions. All those approaches have their advantages and disadvantages. ...Show more