May 8, 2019
Comparing the Costs and Benefits of Notable Climate Policies
Supporters of the Green New Deal and other climate policies often contend that the benefits of action outweigh any costs. In new research, AAF’s Director of Energy Policy Philip Rossetti examines this argument by comparing the potential benefits from the Green New Deal to its expected costs. The claims of net benefits are vastly overstated for the Green New Deal proposals, he finds, but a carbon tax is much more likely to be net beneficial.
Specifically he finds:
- The cost of a net-zero national emission electricity grid would be $321 billion annually (or $2,546 per household), while the global (not national) benefits of the reduced emissions would be $110 billion;
- A high-speed rail system that fully replaces all air travel and all interstate freight hauling could cost nearly $260 billion annually while bringing in $33.7 billion in climate benefits; and
- A conventional carbon tax would cost slightly more than its expected benefits, while a revenue-neutral carbon tax would likely both grow the economy and reduce emissions.