Many economists, left and right, favor a carbon tax. Requiring companies and, ultimately, all of us to pay when we generate greenhouse gas emissions would deliver many benefits. By raising the costs of fossil fuels, a carbon tax would help drive efficiency and conservation. It would stimulate investment in low-carbon sources of energy, and encourage research into new clean-energy technologies. It would, of course, reduce the emissions that cause global warming; right now, anyone is free to dump the equivalent of garbage into the atmosphere without paying a penalty.
More broadly, economists say, governments should impose taxes on things that we want less of, like alcohol, tobacco and pollution–these are known as Pigovian taxes–and try to reduce the costs of the things that we want more of, like jobs, which, unfortunately, cost more to create when government burdens employers with payroll taxes and health care mandates.
What impact might carbon taxes have on business? In my latest story for the Guardian Sustainable Business, I look at three companies — Disney, Microsoft and Shell — that have decided to impose carbon taxes on themselves. They also favor government action to regulate carbon emissions.
Here’s how the story begins:
Visitors who climb aboard the steam trains in the Disneyland resort in southern California need not worry about their carbon footprint. The trains are powered by soy-based cooking oil recycled from the resort’s kitchens.
It’s a Mickey Mouse gesture, really, when set against the millions of miles that park visitors travel by car and plane to reach Disneyland. But it’s driven, in part, by an innovative and forward-thinking tool that Walt Disney, which posted revenues of $42.3bn (£27.8bn) in 2012, uses to regulate its greenhouse gas emissions. A self-imposed carbon tax.
It’s not just Disney. Although most of the world’s governments have declined to put a price on carbon emissions, a handful of global companies, including Microsoft and Shell, have chosen to act on their own. They have established internal carbon prices in an effort to reduce emissions, promote energy efficiency and encourage the use of cleaner sources of power, just as a government tax or cap-and-trade program would.
You can read the rest of the story here.