Toward Zero-Carbon NYC Full-cost pricing of CO 2 (carbon tax) Full-cost pricing of driving –“Cordon” pricing –“Area-wide” road pricing –Curb space priced for 15% vacancy rate Embrace wind power Unbundled + real-time electricity metering Community-based energy efficiency Conservation arbitrage with Upstate NY

Carbon Tax Basics Taxing “bads” > subsidizing “goods” Global metric (unlike cap-trade) Clear price signals (ditto) Distribute revenues pro rata (Alaska) Border Tax Adjustments Polluters Pay As “dynamic” as capitalism Necessary, not sufficient

Carbon Tax Proportions Fuels are taxed by carbon content per btu

Price has fallen in 30 (44%) of past 68 months

Demand for gasoline is price-elastic 2008 v (six months ea.) Usage: 9,021 mbd v. 9,209, ↓ 2.0% GDP: ↑ 2.3%, → [Gasoline ↑ 1.6%] Usage “shortfall”: = 1.6% + 2.0% = 3.6% Price: $3.48 v. $2.75, ↑ 22% “real” Elasticity (short-run): 3.6%/22%, ≈ 0.17 Elasticity (long-run): we assume 0.40

A Carbon Tax “Path” $37 / ton of carbon ( ≈ $10 / ton of CO 2 ) ≈ 10¢ / gallon of gasoline, jet fuel, etc. ≈ 0.72 ¢ / kWh (U.S. retail average) Reduces U.S. CO 2 emissions ~ 4% Repeat > 10 years (while standards and incentives also cut emissions)

Life with a Carbon TaxEnergy Coal-fired generation down Coal-fired generation down Wind and other renewable generation up Wind and other renewable generation up Incandescents / halogens out, CFL’s / LED’s in Incandescents / halogens out, CFL’s / LED’s in Nukes up? Nukes up? Transportation and Land-Use SUVs out, sedans in SUVs out, sedans in Costlier air and highway travel creates market Costlier air and highway travel creates market pull for VGT-quality intercity rail pull for VGT-quality intercity rail Urban trips by bicycle up 10x, to 10% Urban trips by bicycle up 10x, to 10% Urban revitalization Urban revitalization

Who Supports a Carbon Tax? Former V-P Al Gore Mayor Michael Bloomberg NASA climatologist James Hansen Most academic economists and many “public” ones on left and right Friends of the Earth Growing cadre in U.S. Congress

Full-cost pricing of driving For New Yorkers to accept something as transformational as paying to drive on “free” roads and streets, they need to receive a benefit that is equally or more transformational: free transit (Kheel Plan)

“There is nothing more difficult to take in hand than to take the lead in the introduction of a new order of things... the innovator has for enemies all those who have done well under the old conditions, and lukewarm defenders in those who may do well under the new.” — Niccolo Machiavelli, The Prince, 1513

NJ Offshore Wind Farm – The View (NYC needs ~ 7,500 for 100% of kWh)

“To see these giant towers near your house – it would be like driving through oil derricks to get to your front door.” — Retired ABC-TV exec with 65 hilltop acres in upstate Cherry Valley, NY Times, “Windmills on Their Minds,” Aug. 28, 2002

Toward Zero-Carbon NYC Full-cost pricing of CO 2 (carbon tax) Full-cost pricing of driving –“Cordon” pricing –“Area-wide” road pricing –Curb space priced for 15% vacancy rate Embrace wind power Unbundled + real-time electricity metering Community-based energy efficiency “Conservation arbitrage” with Upstate NY

A NYC energy- efficiency failure: Manhattan Community Board 3 lets the clock run out On “Greening A Block”

The bicycle offers the gains of advanced technology without threatening the environment. It stands not only for undamaged nature but also for unbroken autonomy. To attack the pedals may be strenuous over the short run, but it is an expression of trust in one’s own powers, for with the bicycle everything depends on the self. — Wolfgang Sachs

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