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I think the idea is that the tax would dis-incentivize emissions, so the cost of capture is irrelevant.
by ForHackernews 8y ago
I think the idea is that the tax would dis-incentivize emissions, so the cost of capture is irrelevant.
- ttul 8y agoCapture technology becomes automatically profitable if the cost to capture is less than the tax. If my business pays $100/t to emit carbon vs $90/t to capture it, I’ll emit and capture and make a $10/t profit. At $100/t, capture technology would become widespread very very quickly as an arbitrage against the carbon tax. And yes, some emitters might find a more profitable way via reduction in emissions, but since capture is equivalent to reduction, the most profitable option will win out every time. This is the magic of carbon taxes.