Document Abstract
Published:
2010
A method to finance a global climate fund with a harmonized carbon tax
Paper arguing that a common carbon tax is the simplest route to funding climate action
This paper introduces the problem of climate funding, explores the risks associated with cap and trade offsets and expands on the idea of a harmonised carbon tax and global climate fund.
The paper argues that a common carbon tax will be the simplest route to start funding for climate action. Formulas are presented for collection and disbursement, which require parameters for a globally harmonised carbon tax rate, a climate fund contribution rate, a national wealth threshold for fund contributions and need factors for each nation.
The author asserts that market mechanisms are difficult to implement in comparison to public financing, which can result in diversion of time towards structuring the fund’s financial framework rather than structuring climate action. It is suggested that disbursement of the collected revenue for climate aid is based on a set of national climate need factors for adaptation, preserving strategic carbon sinks, low carbon infrastructures and population management.
The paper argues that a common carbon tax will be the simplest route to start funding for climate action. Formulas are presented for collection and disbursement, which require parameters for a globally harmonised carbon tax rate, a climate fund contribution rate, a national wealth threshold for fund contributions and need factors for each nation.
The author asserts that market mechanisms are difficult to implement in comparison to public financing, which can result in diversion of time towards structuring the fund’s financial framework rather than structuring climate action. It is suggested that disbursement of the collected revenue for climate aid is based on a set of national climate need factors for adaptation, preserving strategic carbon sinks, low carbon infrastructures and population management.
