Our carbon fee and dividend proposal works like this.
- A fee is placed on fossil fuels at the source (well, mine, port of entry). This fee starts at £10 a per ton of CO2 emitted, and increases steadily each year by £7 so that clean energy is cheaper than fossil fuels within a decade.
- All of the money collected is returned to UK citizens in the form of equal dividends. About two thirds of us would break even or receive more in their dividend than they pay in higher prices due to the fee, thereby protecting the poorest among us, who also tend to have the smallest carbon footprints.
A predictably increasing carbon price will send a clear market signal which will unleash entrepreneurs and investors in the new clean-energy economy.