Analysis of the American Opportunity Carbon Fee Act of 2015 (S. 1548)
The American Opportunity Carbon Fee Act would levy a fee on US greenhouse gas emissions, largely on carbon dioxide. Modeling results illustrate the magnitude of the emissions reductions over a 15-year time frame (2016 to 2030).
- Under the carbon fee scenario in the proposed American Opportunity Carbon Fee Act, emissions in 2030 are projected to be 64% of the business-as-usual baseline—that is, emissions fall almost 36% from 2016 to 2030.
- With respect to the commonly used 2005 benchmark year, emissions in 2030 would be 43% below the level of emissions in 2005.
- The US pledge under the UN Framework Convention on Climate Change promises emissions levels 26–28% below 2005 by 2025. Modeling suggests the American Opportunity Carbon Fee Act would yield considerably more reductions in 2025 than outlined in the pledge.
- Although the carbon fee levied by the proposed bill would be applied to the carbon content of all fossil fuels, including petroleum, 60-65% of the emissions reductions emanate from the electricity generation sector.
Marc Hafstead is an RFF fellow and director of the Carbon Pricing Initiative and the Climate Finance and Financial Risk Initiative.
Common Resources — Feb 25, 2016
The Environmental Merits of Obama’s Oil Tax Proposal
The Obama administration recently proposed a $10 tax per barrel of oil. In a press release, the White House cited reductions in carbon emissions as...
Working Paper — Nov 20, 2023
Daily Temperature and Sales of Energy-using Durables
This working paper from the European Institute on Economics and the Environment examines whether temperature and other weather variables affect sales of dryers and air conditioning units.
On the Issues — Nov 10, 2023
On the Issues: Renewable Energy Headwinds, Electric Grid Upgrades, and More
A biweekly newsletter connecting global current events, pressing climate and energy policy news, and economics research from RFF scholars. This week: Renewable Energy Headwinds, Electric Grid Upgrades, and More.
Press Release — Nov 9, 2023
Adding an Emissions Cap to the Inflation Reduction Act Could Create More Cost-Effective, Certain Emissions Reductions
New RFF modeling shows that a federal cap on power-sector emissions could carry the United States to its power-sector emissions goal, and that such a cap would be less expensive for emitters and households than it would have been otherwise.