Assignment: 2

Submitted By

Ashishkumar Vora
Student id: 202292418

For subject:

ENGI 9855
Energy and Environment
A carbon tax is a fine that the government imposes on any business that burns fossil fuels like coal, oil, petrol and
natural gas. These fuels produce greenhouse gases like carbon dioxide, methane and nitrous oxide that are bad for the
environment, cause global warming and trap in the atmosphere. The severe effects of climate change caused by these
gases include insufficient precipitation, drought, weather patterns, flooding, and many others.

First of all, businesses will turn to clean energy sources like solar power, wind power, and hydro energy if a high
carbon tax is imposed [1]. As a result of the carbon tax, we will invest more quickly and in low-carbon technologies
like renewable power plants, which have the potential to be cheaper to operate than fossil fuel-based power plants in
the long run [2]. In addition, a carbon tax would boost economic growth and bring in a sizable amount of money for
the government. The money raised from these taxes can be used to address climate change issues, and the government
can also offer subsidies to the alternative energy industry, raising public awareness of renewable energy sources and
creating a cleaner environment by lowering greenhouse gas emissions [3].

Defending against claims that a carbon tax would encourage companies to hide their emissions due to the high tax
rate. Finding external costs and determining how much tax should be imposed on each company, however, is
challenging. In this way, businesses will move their production to nations without a carbon tax [4]. Secondly,
politically acceptable forms of carbon pricing per unit of emissions impose high prices on less wealthy people while
levying low prices on more wealthy people [5]. The economy may suffer from an abrupt increase in the carbon tax.
Low-income people are burdened by the rising cost of fossil fuels. In addition to paying more for necessities, they
would find it difficult to switch to clean energy and finally, a carbon tax would make burning fossil fuels more
expensive, raising the cost of goods and services in the process [6]. As a result, a small amount of carbon tax can raise
the cost of petrol and electricity per kilowatt-hour. In addition to lower profits, low wages, and increased
consumption, these higher prices may also increase the cost of living for households and businesses [7].

In conclusion, I think a carbon tax is a just policy to protect our environment from emissions, allowing governments to
switch to implementing clean energy. However, I think that a carbon tax should be implemented in accordance with
the organizations, so that those who emit more and have a negative impact on people's health should be punished more
severely. A tax should be implemented based on the amount of carbon that each industry emits into the atmosphere,
causing air pollution. Governments should use the money they receive from the carbon tax to subsidize the alternative
energy industry. Additionally, governments should raise public awareness of how carbon emissions affect the
environment.
Bibliography
[1] K. Amadeo, "Carbon Tax, Its Purpose, and How It Works- How a Carbon Tax Can Solve Climate Change,"
The balance ,24 October 2020. [Online]. Available: https://www.thebalance.com/carbon-tax-definition-how-
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[2] Economics Help , "Carbon Tax- Advantages and Disadvantages," [Online].

Available: https://www.economicshelp.org/blog/glossary/carbon-tax/. [Accessed 03 June 2021].

[3] International Monetary Fund , "Putting a Price on Pollution," [Online].

Available: https://www.imf.org/external/pubs/ft/fandd/2019/12/the-case-for-carbon-taxation-and-putting-a-price-
on-pollution- parry.htm. [Accessed 03 June 2021].

[4] T. Pettinger, "Carbon Tax – Pros and Cons," Economics Help , 01 December 2020. [Online].
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[Accessed 03 June 2021].

[5] L. Tank, "The Unfair Burdens Argument Against Carbon Pricing," Journal of Applied Philosophy,
vol. 37, no. 4, pp. 612- 627, 07 April 2020.

[6] Clements, R. J, Haggar, A., Quezada, J., and Torres (2011). Technologies for Climate Change Adaptation –
Agriculture Sector. Zhu, X. (Ed.). UNEP Risø Centre, Roskilde.

[7] Consoli, C. (2019). Bioenergy and Carbon Capture and Storage, Global CCS Institute.
Available online at: https://www.globalccsinstitute.com/wp-content/uploads/2019/03/
BECCS-Perspective_FINAL_18-March.pdf (accessed November 1, 2022).

[8] Hovorka, S. (2009). Risks and Benefits of Geologic Sequestration of Carbon Dioxide –
How Do the Pieces Fit? AAPG Annual Convention.
Available online: https://www.searchanddiscovery.com/pdfz/documents/2009/80058hovorka/ndx_hovorka.
pdf.html (accessed November 1, 2022).