Smokers pay manufacturers for their cigarettes and, through tax on those cigarettes, the additional cost of treatment for the smoking related diseases they get. As a result, provided the tax is set at the right level, smokers pay the full cost of their habit. The tax also helps to discourage smoking.
Carbon pricing is the same kind of adjustment but, now, it’s a payment to compensate for the impact of greenhouse gas emissions. It ensures that polluters pay the full costs associated with their activities.
These are real costs. We’re already seeing insurance premium hikes (caused by increased climate-related claims), higher food prices (as climate change impacts agriculture) and increased taxes (to fund flood defences). Carbon pricing does not increase costs overall (because the costs are there already) but it does change who pays.
Carbon pricing also discourages emissions. It focusses the minds of millions of people, businesses and organizations on how to avoid the tax. Governments then no longer need to decide whether to encourage nuclear power, tree-planting or vegetarianism. Market forces will find the cheapest solutions. And cheap is good—the lower the cost of cutting emissions, the sooner and faster it will happen.
Carbon pricing is a central pillar of the Citizens’ Climate Lobby. It’s what we campaign for because it’s the least disruptive and most cost-effective way to achieve rapid emission reductions.