Dr. Ashley Nunes is an academic at the Massachusetts Institute of Technology and Harvard University. Previously he lead research projects sponsored by the Department of Defense and the Department of Transportation. In this article he argues that putting our faith in technology alone to fight climate change is mistaken.
Technology, not taxes. That’s how Canadian conservatives plan to fight climate change. Their long-awaited proposal — unveiled last week — promises plenty of fiscal goodies for going green. Under the plan, companies could see hefty cuts in corporate taxes for using eco-friendly technology while homeowners could receive thousands of dollars in tax credits for adopting energy efficient products. Conservatives say these measures will help Canada meet its emissions targets (the country is signatory to the Paris climate agreement), move the global needle on climate action, and establish Canada as an environmental leader.
One thing the proposal won’t do is tax Canadians. “Our plan does not have a carbon tax,” the 60-page write-up emphatically states. That position clashes with the ruling Liberal government — and the governments of 40 other countries — who see carbon pricing as the best way to fight climate change. Canadian Prime Minister Justin Trudeau calls the move, “putting a price on pollution”. Trudeau’s conservative rival disagrees with punitive taxes. At a rally last week, Andrew Scheer told supporters, “conservatives fundamentally believe that you cannot tax your way to a cleaner environment.” For Scheer, the real solution to reversing climate change “lies in technology”, which should be encouraged via tax subsidies.
Scheer’s position has some merit. A recent United Nations report found energy-efficient technology could — on an annual basis — cut 25 billion tons of greenhouse gas emissions, 17 million tons of particular matter (linked to respiratory illness), and three billion tons of human-toxic waste. Sensors and software could also improve the energy efficiency of buildings, homes and cabins by up to 50 per cent, reduce metal consumption by up to 75 per cent and save precious natural resources, like water and land, by 200 billion cubic meters and 150,000 square kilometres respectively.
But that not the whole story. The UN also warns that using green technology may be less beneficial (and in some cases, more harmful) than expected. It’s called the rebound effect - instances where technologically-driven advances in energy efficiency increase, rather than decrease, consumption leading to net-zero (or worse) emissions. For example, because electric cars cost less to run, consumers may drive them further and more often which wipes out the eco-advantage these vehicles have over their gasoline-powered counterparts. According to the Breakthrough Institute, a research centre that promotes tech solutions for environmental and human challenges, this effect means that “for every two steps forward we take in energy savings through efficiency, rebound effects take us one (and sometimes more) steps backwards.” This may erode up to 50 per cent of the eco-benefits promised by green technology by 2030, according to a paper by Barker, Dagoumas and Rubin.
Consumer behaviour affects energy efficiency in other ways, particularly at home. For example, British researchers have found buildings designed to save energy don’t always perform as expected, “partially because occupants behave in more complex ways than designers account for; they open windows, leave doors open, generate body heat, keep tropical fish tanks and install plasma TV screens”. To put it simply, buildings don’t use energy — people do. And predicting what people will do is notoriously difficult. A family must insulate their home to save energy only to then use those savings on buying home appliances that use even more energy.
This reality undercuts the idea that economic prosperity and climate action can — thanks to technology alone — go hand-in-hand. Such reasoning isn’t just overly simplistic; it’s an economic oxymoron. There is — as the famous adage goes — no such thing as a free lunch. Which brings us to the carbon tax. Opponents say it will lead to wallet woes. Commuters driving to work, parents ferrying their kids to school, and seniors heating their homes will all be forced to pony up more cash. Political rhetoric aside (many countries offer generous ‘climate rebates’ to consumers), that’s the point of carbon pricing. It prompts greater awareness of our energy choices and their impact on the environment, and helps us to learn about our consumption habits before it’s too late.
Canada admits its carbon tax would need to rise dramatically to hit the targes set by the Paris agreement. Similar sentiments have also been expressed by other countries. This makes taxing our way to a greener future an admittedly unrealistic prospect. But so is innovating our way there with the aid of subsidies. We may well need both, in equal measure.