Instead of the now defunct notion of Cap and Trade, a bipartisan group of members of Congress have introduced the Carbon Limits and Energy for America’s Renewal (CLEAR) Act which strives to reduce the carbon intensity of our economy and reduce the amount of carbon introduced into the atmosphere. How does it work? Like Cap and Trade it sets an annual limit on Carbon emissions based on pre-set targets. Unlike cap and trade, “CLEAR establishes an auction for “carbon shares” instead of pollution credits. To sell carbon-based fuels or carbon-intensive products, importers and suppliers would need to bid for carbon shares at a government auction. Instead of giving away permits to pollute, CLEAR auctions 100% of each year’s quota of carbon shares.” – environmentalleader.com.
Now the really exciting part – 75% of the profits would go into the Carbon Refund Trust Fund which would distribute money annually to all citizens to purchase more energy efficient appliances, vehicles, upgrade homes and generally “green” their lifestyle. Since it is a trust fund, money from the fund could only go toward purchasing products that reduce carbon emissions and the energy intensity of average Americans. The other 25% would go to a Clean Energy Reinvestment Trust Fund which the president and Congress could use to fund programs, incentives, loans and grants to create a cleaner economy. In sum, the program would tax carbon emitters and give that money directly to people and programs to help reduce carbon emissions. Doesn’t that make a lot of sense?