- The MARKET CHOICE Act introduces a tax of $24 per ton (of CO2-equivalent) on GHG emissions beginning in 2020. The tax rises at 2% annually. If the bill becomes law, we project that energy-related CO2 emissions will be 29% below 2005 levels in 2030.
- In the power sector, CO2 emissions are expected to be 56% below 2005 levels in 2030. For comparison, the Obama administration’s EPA projected CO2 emissions to be 32% below 2005 levels under the Clean Power Plan.
- Repealing the federal excise tax on gasoline and diesel fuel would significantly reduce price impacts at the pump. As a result, the analysis predicts very small changes in transportation-related emissions.
- Gross revenues from the tax on CO2 emissions are expected to exceed $1 trillion over the first 10 years of the policy.
- This analysis does not attempt to model two important aspects of the act: border adjustments and the tax on emissions of non-energy-related CO2 and other greenhouse gases.
- The MARKET CHOICE Act includes an adjustment mechanism to increase the price over time if key emissions targets are not met. Emissions targets in the bill were directly informed by this analysis.