SCI1300 Lecture Notes - Lecture 27: Carbon Price, Emissions Trading, Carbon Tax

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I(cid:374) su(cid:272)h a (cid:272)ase, the (cid:862)(cid:272)osts a(cid:374)d (cid:271)e(cid:374)efits of [e(cid:373)issio(cid:374)s (cid:272)o(cid:374)t(cid:396)ol] a(cid:272)(cid:272)(cid:396)ue to diffe(cid:396)e(cid:374)t people(cid:863), eg: . Reducing carbon emissions would cost the fossil fuel companies but the benefits would accrue to the public, now and in the future, rather than the fossil fuel companies. So we need to establish policy seei(cid:374)g"s so that the (cid:862)(cid:373)a(cid:396)ket(cid:863) (cid:449)ill (cid:449)o(cid:396)k app(cid:396)op(cid:396)iatel(cid:455: also, costs of preventing climate change will affect us now, but costs of not doing anything will affect us in the future. So we need a way of comparing current and future costs (discount rate) Costs to future generations (cid:862)discount rates(cid:863: most damage from global warming will be felt by future generations. O (cid:449)e (cid:374)eed to e(cid:395)uate (cid:272)ost to (cid:862)us(cid:863) of (cid:272)utti(cid:374)g e(cid:373)issio(cid:374)s, agai(cid:374)st (cid:272)ost to futu(cid:396)e ge(cid:374)e(cid:396)atio(cid:374)s if (cid:449)e do(cid:374)"t (cid:272)ut e(cid:373)issio(cid:374)s. (cid:862)dis(cid:272)ou(cid:374)t (cid:396)ate(cid:863) is (cid:449)hat e(cid:272)o(cid:374)o(cid:373)ists use to (cid:272)o(cid:373)pa(cid:396)e (cid:272)u(cid:396)(cid:396)e(cid:374)t a(cid:374)d futu(cid:396)e (cid:272)osts. I might be dead in 10 years from now.

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