By Susanne Rust
As governments try to figure out the best way to get carbon polluters to invest in and produce cleaner energy, two scenarios continue to come forward: cap and trade vs. carbon tax.
A new study from UC Merced and the University of New South Wales in Australia suggests that a free and uninhibited cap-and-trade system is the best way to go. The authors argue such a system will “trigger adoption of clean technologies at a considerably lower level of carbon prices” as compared with a tax system.
In addition, the study concludes that the higher risk and volatility of an unhindered market “are likely to induce suppliers to take early action to hedge against carbon risks.”
Continue reading Free Cap-and-Trade System Beats Carbon Tax, Study Finds
