Tang Prize Laureate James Hansen Suggests Imposing Carbon Fees to Rapidly Cut Fossil Emissions

  • James E. Hansen, 2018 Tang Prize Laureate in Sustainable Development
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Representatives from more than 200 countries gathered in Madrid for this year’s COP25 to draw up plans for the implementation of the Paris Agreement. With talks about carbon markets in the spotlight, delegates tried to find a way to reduce carbon emissions and finalize UN carbon trading rules. Dr. James E. Hansen, 2018 Tang Prize winner in Sustainable Development and an expert in global warming, offered the Foundation his opinions on this meeting, pointing out that “an across-the-board” rising carbon fee imposed on “oil, gas and coal” can induce consumers to change their spending habits and eventually shrink their carbon footprints.  


A key figure at the forefront of the campaign for climate change awareness, Dr. Hansen was invited to testify before a US Senate Committee in 1988, when he was still the director of NASA Goddard Institute of Space Studies. His proclamation in this hearing made the front page of The New York Times, with its headline reading “Global Warming Has Begun.” It was a pivotal moment when he drew the world’s attention to this emerging crisis. In 2008, he assembled a group of scientists and identified 350ppm as the maximum safe level of atmospheric CO2. However, towards the end of 1980s, the average concentration of atmospheric CO2 had already passed this landmark. In response to this grim reality, he suggested that we keep the CO2 level below the 450ppm threshold and then try to lower it to 350ppm. To achieve this goal, each nation has to come up with a mechanism to phase out fossil fuels and couple it with strong economic incentives. Viable solutions also include developing new technologies to switch our reliance on fossil fuels to clean energy sources.


The main strategy to reduce carbon emission, for Dr. Hansen, is to charge carbon fees and distribute the revenues thus generated to the entire population. This “carbon fee and dividend system” would discourage the consumption of fossil fuels as fossil fuel-based products and services becomes more expensive. “Economists agree, it is, by far, the fastest way to phase down emissions,” Dr. Hansen remarked.


In addition, he notified us that “these funds, collected from the fossil fuel companies, must be distributed, 100 per cent, to the public. Otherwise, the public will rebel, as ‘yellow vests’ demonstrated in France.”


The advantage of this fee and dividend model, according to Dr. Hansen, is that “it is progressive, as most low-income people get more in the dividend than they pay in increased prices. It stimulates the economy, creates jobs and modernizes infrastructure.”  

With regard to the efforts made by people in the Europe, Dr. Hansen mentioned the Danish chapter of the Citizens Climate Lobby, a group that is “spurring an initiative to collect one million signatures,” in the hope of forcing “the European Parliament to vote on fee & dividend.” So far they have obtained 40,000 signatures. Explaining the significance of this grassroots action, Dr. Hansen told us that “it is hard to inform people about this (fee-and-dividend) one by one, but if enough organizations understand the carbon reality, they can get their memberships behind the ballot initiative.”   


On the other hand, in America, the Citizens Climate Lobby “now has more than 500 Chapters with more than 170,000 members.” Dr. Hansen believes that “they can eventually get Congress to adopt a rising Carbon Fee & Dividend.”

When it comes to China, Dr. Hansen named “a huge reduction of air pollution as well as a huge reduction of carbon emissions” as the merits of imposing a carbon fee. Moreover, “if the dividend is distributed uniformly, as in other countries, it will increase social justice. Wealthy people will lose some money, but they can afford it. The population as a whole will be glad to see the government taking action to deal with pollution and rewarding financially those citizens who make an effort to limit their carbon footprint.”

Finally, Dr. Hansen stressed that “the West must understand that China doesn’t owe us any special effort. China now has the largest annual emissions, but climate change is proportional to cumulative emissions. China’s cumulative per capita emissions are far less than those of the U.S., U.K., and Germany.” He further cautioned us that “at some point we will realize that we are all living together on the same ‘pale blue dot’ and we must cooperate to preserve our living space.”


To elaborate on the possibility of international cooperation, Dr. Hansen believes that “the climate problem will not be solved until the United States and China agree to simple rising carbon fee.” Noticing that “China’s greatest emissions are from coal burning, as they have massive energy needs for power plants and industrial heat,” he expressed the idea that “for mutual benefit, the United States and China should cooperate to develop” modular, passively-safe fission reactors that “deliver continuous power cheaper than coal.” It is also “the safest energy source with the smallest environmental footprint.”


Dr. James Hansen and Prof. Veerabhadran Ramanathan were jointly awarded the 2018 Tang Prize in Sustainable Development for making seminal contributions to our fundamental understanding of climate change and its impact on the sustainability of life on earth. Dr. Hansen decided to use his Tang Prize research grant to fund the “Climate Science, Awareness and Solutions Program” he runs in Columbia University’s Earth Institute. To learn more about their proposals and actions on how to combat climate change, please visit their newly-launched website at https://csas.earth.columbia.edu/