Understanding Carbon Taxes
A carbon tax prices CO₂ emissions to incentivize reductions. Key emission factors: electricity averages 0.417 kg CO₂/kWh (varies by grid mix), natural gas emits 5.3 kg CO₂/therm, gasoline emits 8.887 kg CO₂/gallon, and diesel emits 10.18 kg CO₂/gallon. At $50/ton, gasoline would increase about $0.44/gallon. Many proposals include revenue-neutral dividends, returning proceeds equally to households.