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David M. Schizer (Columbia) presents Purple White and Blue – and likewise Inexperienced: How Vitality Coverage Can Shield Each Nationwide Safety and the Atmosphere at San Diego at this time as a part of its Tax Regulation Speaker Sequence.
Too typically, vitality coverage protects the surroundings whereas neglecting nationwide safety, or vice versa. Since every purpose is important, this Article reveals to the best way to advance each on the identical time.
For nationwide safety, the hot button is to keep away from relying on the improper suppliers. If they’re weak to assault (like some Center Japanese producers), they have to be defended. Or if they’re themselves geopolitical threats (like Russia and Iran), their vitality exports fund dangerous conduct. This Article breaks new floor in exhibiting why suppliers are usually insecure or menacing: authoritarian regimes have a comparative benefit in producing oil and fuel, since they’re much less aware of opposition from environmentalists, native residents, and different teams.
To keep away from relying on the improper suppliers, the U.S. and its allies ought to pursue two methods. First, they need to lower demand for fossil gas. Together with making it simpler to cease shopping for from the improper suppliers, slashing demand additionally reduces greenhouse fuel emissions and air pollution.
But though these are important nationwide safety and environmental benefits, there may be an offsetting nationwide safety threat: like fossil gas suppliers, many clear vitality suppliers are insecure or probably hostile (like Congo and China). In response, the U.S. and its allies ought to ramp up home manufacturing of fresh vitality know-how, whereas additionally encouraging households and companies to make use of it.
Second, because the transition to scrub vitality will take time, the U.S. and its allies additionally must faucet new sources of fossil gas in nations which might be safe and pleasant. But since new fossil gas improvement raises acquainted environmental issues, this Article proposes 3 ways to do it whereas nonetheless lowering emissions and air pollution. First, these new sources must be as “clear” as potential (e.g., pure fuel as an alternative of coal). Second, in including new capability, the purpose must be to interchange different fossil gas sources, to not add to them (e.g., so extra manufacturing within the U.S. means much less in Russia). Third, new sources must be versatile, to allow them to ramp up and reduce, as wanted. Thankfully, these shifts are comparatively simple for U.S. shale producers—certainly, extra so than for others–and might be inspired with the proper regulatory approaches.
Whereas authorities intervention is required to pursue these targets, policymakers ought to try to harness the non-public sector’s capability to innovate, lower prices, and improve high quality. A moratorium on new fossil gas improvement is counterproductive, entrenching a established order that relies upon an excessive amount of on coal, in addition to on insecure and hostile vitality suppliers. As an alternative, the most effective strategy is to “worth” the related nationwide safety and environmental prices with Pigouvian taxes, motivating companies and shoppers to mitigate these prices and letting them select the best way to do it. But if Pigouvian taxes aren’t politically possible, this Article recommends a heuristic referred to as “the marginal effectivity price of vitality”: policymakers ought to account for all of the social prices of every supply—non-public prices, nationwide safety prices, and environmental prices—and try to interchange excessive price sources with low price sources. This framework ought to information all features of vitality coverage–from permits and laws to rate-setting, mandates, moratoriums, subsidies, and authorities leases–so policymakers keep targeted on each environmental and nationwide safety targets.
https://taxprof.typepad.com/taxprof_blog/2023/03/schizer-presents-how-energy-policy-can-protect-both-national-security-and-the-environment.html
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