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Comment by dTal | Hacker News Reader

I think the key insight that's missing in these discussions is we need to tax carbon at the point of extraction, not at the point of consumption. We need to make mines and wells unsustainably expensive to operate. If people really need oil, they'll find ways to manufacture it more cheaply from biowaste.

The trouble is that this is a Hard Problem because a huge fraction of the world's carbon is extracted in or by countries whose geopolitical standing would be crushed by this. But unless we do this, the same amount of carbon will ultimately be extracted and subsequently burned by somebody.

(Also when push comes to shove nobody actually gives a shit about any of this, and any politician who deliberately does anything to raise fuel prices will find their head on a pike)

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" If people really need oil, they'll find ways to manufacture it more cheaply from biowaste."

What? No.

We don't care about the extraction.

If oil must be burned, don't care whether it's Oil from wells or Oil from biowaste.

If it's oil for burning an engine, and we need that engine to operate for some economic reason - then we actually want people to consume the cheapest version.

We don't want to make people jump through hurdles to 'run an engine that we need to run' for no reason.

We may want to make sure that running that engine is economically essential, in which case keeping prices high, or, by some regulation.

The act of 'extraction' is not a problem, there's not much negative from that.

Other than geostrategic issues (i.e. Russia) we don't care where it comes from.

What we want to do is tax the fuel itself - not emissions.

The emissions are a direct function of the fuel.

We know X litres of gas will create Y tonnes for Co2 and that's it. So tax the fuel instead of getting people to figure out emissions.

Oil that is used for other reasons, we don't really care about.

We could put a fuel tax, and a natural gas tax up right now - we already have mechanisms in place for that.

>If oil must be burned, don't care whether it's Oil from wells or Oil from biowaste.

Yes, we really do. There is vastly more carbon in the atmosphere than a hundred years ago. Where did it come from?

You can burn oil made from biowaste all day and all night and it won't raise CO2 levels one little bit. Why? Because all that carbon came from the atmosphere to begin with! All the carbon in living things comes from plants, who get it from atmospheric CO2. It's a closed cycle.

The problem is solely, 100%, taking carbon that has been safely in the ground for millions of years, and through a convoluted process putting it in the atmosphere and never retrieving it. And then being shocked that atmospheric CO2 levels are returning to what they were millions of years ago, in the period aptly known as the "Carboniferous".

Oh, no, this is flawed reasoning. Sorry.

"You can burn oil made from biowaste all day and all night and it won't raise CO2 levels one little bit. Why? Because all that carbon came from the atmosphere to begin with! All the carbon in living things comes from plants, who get it from atmospheric CO2. It's a closed cycle."

Oil comes from plants and animals, crushed under the weight of the earth, it's also a 'natural cycle' - but that doesn't matter at all.

"The problem is solely, 100%, taking carbon that has been safely in the ground for millions of years, a"

No, it has nothing to do with that at all.

It doesn't matter where or how the carbon gets into the air.

Anything that is going to be used as a fuel, we tax, relative to the amount of CO2 it emits, and that's that.

If as it turns out it's incredibly more efficient to burn 'biofuel' than it is to extract Oil - fine. But it's probably not the case.

It depends on what would happen to the biowaste otherwise. Probably if the waste isn't turned into fuel, it will just rot and release the carbon anyways. In that case, it wouldn't make sense to tax the fuel. It only makes sense if the carbon would otherwise be safely stored and kept from going into the atmosphere.

Yes, the argument is 'burn stuff that's going to go into CO2 anyhow' but it just doesn't add up.

There are not that many dead trees, they don't release all of their Co2, you don't get that much energy, and it's a 'dirty emission'. Burning Hydrogen gives you CO2 and H20 - nice and clean. Burning wood gives you a lot of bad things.

So, I think it's worth talking about CO2 and other emissions (particulates, etc) separately. I totally agree that wood isn't great to burn from the standpoint of all the other stuff that goes into the air. And I agree that it's not a very efficient energy source either. It makes sense to use if you're chopping down trees near your rural home and burning them for heat in winter, but not as, say, a source of fuel for a power plant.

But I think that it's accurate to say that when you burn wood, you're emitting CO2 that would have been released as the wood decayed anyway. In that sense, you're not really contributing to climate change. This doesn't count any energy used in harvesting and transporting the wood, which of course could contribute to emissions.

To use another example, if you grow sugar cane, and using green energy sources, turn it into ethanol, and burn that in a car instead of gasoline, that's basically carbon neutral. If you hadn't grown the sugar cane, something else would have grown there, and decayed, and released the carbon into the atmosphere.

It would be valid to argue that if we had let the field turn into a forest, it would trap more carbon than the sugar cane would. And we should let forests regrow, where we can! But it's a one-time thing -- once the forest is grown, it would stay stable in the amount of carbon captured there. To continue to trap carbon, we'd need to keep harvesting the trees and doing something with them to permanently take them out of the carbon cycle, like turning them into buildings or somehow turning the carbon in them into something that doesn't decompose and burying it.

Their point is that nowadays carbon from dead plants and animals generally gets recirculated, but this wasn't always the case. Back before the enzymes to break down lignin and cellulose existed, when trees died the carbon they had extracted from the atmosphere didn't recirculate. And if we hadn't started digging up fossil fuels and burning them, that carbon would have remained buried basically forever. So where the oil comes from does matter.

https://en.wikipedia.org/wiki/Carboniferous#Fungi

As a sideline on this conversation. I'm VERY interested in dTal's point and if it stands up to scrutiny. To me, it makes sense. The carbon in the air now is from carbon that was sequestered. It was in oil, it was in trees, it was in the rocks. Then we let it go. We drilled oil, cut down the trees and burned them and built them, we made concrete.

So. If you take carbon out of the ground, and expect to see it floating in the air, you should be taxed. That's the idea.

But does this make sense? Just how much of the carbon in oil really is destined for the air? How much of the wood? How much of the stone? Or is there some other chain I'm missing? How much carbon would be sequestered in plants that produce biofuel? How much of a net negative is ethonol production anyway? What about other fuels? This subject seems complex to me.

You seem to think all this is wrong, and it could be! I really would be interested to hear where the logic breaks down.

If you planted a tree purely for the purposes of later burning it, it would 'capture' a bunch of Co2, then when you burnt it, it could release that Co2 creating a net 0 cycle.

It's not efficient as an energy cycle.

Not even considering the fact that wood burns in a very 'dirty' way and would require a lot of energy to 'clean' the emissions.

yes. That's a net zero. That's the point. If the point is carbon, then net zero is net zero. This is what dTal is saying. We shouldn't tax an activity that is net zero.

So it seems the real point is that it's "dirty"? We'd have to clean... what? Particle emissions? Most areas I see woodburning done have high quality air, low particle counts. Because their density is so low.

This keeps happening. The core rebuttable to dTal's argument is being left unstated. You keep saying it's wrong, you keep not saying why.

We probably wouldn't burn wood directly. Ethanol is also biomass. In fact, every single fuel we "burn" is biomass. The hard part is getting hold of carbon that isn't glued to some oxygen already. Once you have it, you can process it into whatever form best suits you.

You have to be careful when you speak of "efficiency". You have to specify, with respect to what expended resource, and what desired goal? If we say the expended resource is "land area" and the desired goal is "powering all of civilization", then indeed the the "efficiency" of growing trees and burning them is not so great, compared to say solar panels. But if the expended resource is "environmental damage" and the desired goal is "heating a cabin in the woods", burning tree wood is extremely efficient.

When you think about it, the real problem is the mismatch between how much CO2 is released and how much is absorbed. It took millions of years to absorb the CO2. It will take us 400 to "burn it all". If we had to burn coal within the limits of what the planet can absorb it wouldn't be a very effective power source. It could barely compete with trees.

Yes. The real real problem is energy. We are expending stored energy at a rate much higher than it was stored. Using plants to sequester carbon is a slow and long-winded way of extracting solar energy, although it has a number of advantages too - low-tech, self-sustaining, self-storing, convenient medium for immediate low-tech use i.e. burning.

To sustain our current per-capita energy consumption beyond our accumulated biomass stores, the limiting factor is land area. There's probably not enough space on Earth to devote to growing biomass purely for energy. Solar panels reach 10 times the generated power per unit area, easily, and we can do even better by exploiting energy accumulation that happens without technology, like wind.

> We don't care about the extraction

For carbon-reduction purposes maybe not, but fracking does create its own problems.

A lot of people actually do give a shit, myself included! I like the approach of coupling a carbon tax with a dividend -- it's a lot more palatable to centrists and people who lean right, because it isn't going to what they might consider government waste -- the money from the tax just gets returned to the people. This is the policy that Citizens' Climate Lobby pushes (the EICDA [1]), and there are a LOT of people working on getting it passed.

[1] https://energyinnovationact.org/

It would need to be at the point of extraction or importation. Then you'd need tax treaties with countries who are adopting similar policies.

Taxing at the point of extraction or consumption should be equivalent, right? No one extracts for the sheer fun of it.

It seems to me we could take a page out of Europe's VAT book which is ultimately paid by the consumer but tracks the "value added" throughout the supply chain from raw resources to finished goods.

I think it's mostly that one is fairly easy to track, the other is nightmarishly hard and also easy to evade.

Main problem with at-production is that not all consumptions are equal, and it puts the cost equally on all.

So the implementation I like (https://energyinnovationact.org/) would tax the production, but companies could get a tax rebate for non-fuel consumption, such as manufacturing plastics. That puts the onus on companies to get their rebate and is a lot easier to enforce, but is pretty fair -- plastics don't cause emissions aside from the energy used in their production (which would already be taxed if it comes from fossil fuels). I guess one issue would be if you're burning a lot of plastic garbage, like I've heard is common in Japan, though I don't know if that's a big contributor to emissions.

I think it's fair to say it would become common, if you imposed punitive taxes on everything except plastic.

Once it's out of the ground, it's a matter of time before it ends up in the atmosphere, unless unusually careful sequestration measures are taken. Better to subsidize those, and tax generation, rather than try to micromanage the bit in between.

All consumption is equal, to a first approximation. To avoid it ending up in the atmosphere you'd have to go out of your way to ensure that whatever fossil-fuel-based product gets sequestered back in the ground after use - all of it, and somewhere where nobody can easily dig it up again and burn it.

why? we tax cigarettes at the point of consumption and that has worked fine.

Supply chains are not 100% transparent.

We know how bad one unit of "cigarette" is for our health, but we don't know how bad one unit of xxx is for the environment. An apple can have a co2 footprint of multiple tons of co2 or zero tons of co2. We can't know for sure.

Because you should tax the thing you want to stop. Burning carbon is absolutely fine, provided the carbon originally came from the atmosphere and not buried deposits. It's the open-loop cycle that's the problem. The moment you dig it up, eventually it's bound for atmosphere. You want to financially encourage the development of "green" petroleum - nobody will bother if it's taxed all the same.

Also, if you try and individually tax the hundreds of thousands of different uses for carbon, according to how much carbon each thing uses, inevitably you'll get it wrong, and this will create inefficiencies and perverse incentives to do arbitrage between the various poorly calibrated taxes. What you want is for the market to figure it all out!

Products don’t come with a label measuring how much oil was burned in their production. Even if the manufacturer wanted to know, tracing that detail through their entire supply chain is really difficult. Preventing fraud is also very challenging.

Whereas if you tax at extraction this is automatically take into account at every step of the supply chain. The market does all the hard work for you.

Taxing carbon at the point of consumption is like taxing a product if the manufacturers' employees have smoked at the point of consumption. How are you going to enforce that? A product that was manufactured by smokers and non smokers looks identical.

Carbon is a global problem indeed. The most global I would say. So clearly we can't have such a tax be only on local production. Makes me wonder if Bitcoin could play a role.

Ok, I'll bite...how exactly does this have anything to do with bitcoin?

I don't. Only connection is that they are both global problems ;)

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