Climate Economists React to Obama’s Proposed Oil Tax
View on Climate Central websiteCarolyn Fischer, Resources for the Future senior fellow: A better question is, does this tax better align fossil fuel prices with their social costs? Given that the EPA estimate of the social cost of carbon is around $40, and a barrel of oil leads to about 0.43 tons of CO2, that implies a social cost of $17 per barrel, so a $10 per barrel tax does move us closer to that. One can also note that oil use is associated with other problems like particulate matter, congestion, accidents, etc. that are also underpriced.
