Other Government Programs
All revenues will accrue to the government (or governments) where the price is taken. But then what? Typically government controlled systems earmark funds for projects that either mitigate climate change (reduce GHG) and/or those that help adapt to the changes global warming will bring. Two examples of this approach are California and the Regional Greenhouse Gas Initiative (RGGI) in the northeastern U.S.
Other earmarks could be to reduce the deficit or fund specific needs, such as infrastructure. Or reduce other taxes.
In all of these approaches a sunset consideration is very important, because by its nature, revenue based on carbon pricing should eventually trend toward zero.
The challenge we face needs to be attacked with all of our talent and innovation. Basic research can find answers that we can’t even imagine at this stage. Already we are seeing major advances. MIT has an Energy Initiative which involves all parts of the university. Its research is bringing exciting new ideas to fruition, with accompanying entrepreneurial development. For example, the leaf, developed by Daniel Nocera, uses sunlight to split water into hydrogen and oxygen; the hydrogen can then be used in a fuel cell to take the user completely off the grid. Other universities and national labs are also pursuing innovations. Many ideas — possibly just those ideas that will make the most difference — currently just languish because funding is not available.