Elon Musk On Why We Need A Carbon Tax

Billionaire Elon Musk has a few things on the boil at the moment. He's revolutionising how we all get around with Tesla electric supercars, SpaceX reusable rockets and an experimental Hyperloop, while also working on a plan to launch a Mars colony running in the background. Needless to say, he's a real-life billionaire/genius/playboy/philanthropist. At a recent press conference, he was asked if governments should put a price on carbon, and his answer is incredibly sensible.

When asked by a journalist in January about his thoughts on a carbon tax, Musk had this to say:

I do think it's extremely important we establish a carbon tax. This is a carbon tax that would apply to all carbon-producing entities. From electricity-generation from hydrocarbons through to production of gasoline and consumption of gasoline. I think that will actually increase the price of electricity — that is to say the electricity coming from hydrocarbons — and it will increase the price of gasoline, but I think this is important because right now we're consuming this extremely valuable common good which is the carbon capacity of the oceans and atmosphere. We're not paying anything for that consumption.
It's like having a garbage pile in your street and nobody's paying for it. The garbage gets higher and higher, and eventually terrible things happen, so it's just very important to put a price [on carbon emissions]. If somebody's dumping chemicals in the atmosphere you need to pay for it.

At last year's UN Climate Leadership Summit, 74 countries (PDF) around the world — including China, South Africa and the United Kingdom — supported putting a price on carbon.

During the tenure of the previous Labor government, Australia was on the list of countries with a carbon price in place, however the legislation was repealed following the Coalition's rise to power.

In a speech to the National Press Club yesterday, Prime Minister Tony Abbott pledged that he wouldn't resurrect the carbon tax, adding that it's still a policy of his Labor counterpart, Opposition Leader Bill Shorten should Labor win the next Federal election.

Is Australia on the wrong side of history when it comes to pricing carbon? Give us your thoughts in the comments.

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    right so more people buy electric cars?

      He says that he sees a carbon tax increasing the price of electricity (at least the electricity that most of us have access to right now). He obviously has an interest in selling electric cars but I think his answer is about as agnostic as you could hope for.

        Sure, but it is VERY selective on his part because he knows the effect on the price of petrol would be far greater.

        Agreed. Musk strikes me as one of those guys who believes that creating a more sustainable future is good business in the long term, even if it costs a bit in the short term.

    If it was more expensive to use fossil fuels would this not spur on development for cheaper/greener technologies? Which is a big bonus.

      Why is it a big bonus? Why is making everyone's life a misery a big bonus? Why must we continue to fiddle around the edges of the problem, rather than face the real problem, population? Any talk about the environment that is not centred around reducing the population is wrong-headed and, therefore, irrelevant.

      That was indeed the main point of the carbon price we had, before it got scrapped. While fossil power costs went up a little, solar and wind power both got cheaper, and since carbon fuels are currently costing us $6 billion every year in health costs alone, a phased transition to carbon-neutral energy would clearly be a net benefit to the economy.

    Come on Mr Turnbull, you went to visit Mr Musk last week,


    didn't you listen to him?

    You were spending ten thousand a year on petrol for your car...so giving everyone an electric in Los Angeles means 40 billion a year in the Los Angeles economy.

      Who was spending $10,000 a year? At $1.50 a litre, a Holden Commodore would need to do 60,000km a year, or four times the national average, before you'd be spending that much. Personally, I spent less than $1500 on petrol last year, which included several trips to Canberra and one to Melbourne, and my car only gets around 10.5 litres/100km in mixed driving.

        I drive on average about 20,000klms a year for work and probably spend about $3k. The difference in the cost of petrol doesn't make a huge impact apart from the individual purchases possibly being noticeably cheaper.
        That being said, I think petrol and diesel is yesterdays news. We need to move into cleaner energy (solar imo) and get these electric cars going. The only people interested in keeping this tech are the car companies and the oil companies.
        Consumers are buying fuel efficient cars in greater number every year, regardless of actual savings to them. Often costing more than a "regular car"

    Bravo! That's why carbon pricing was so clever. It created market forces which made polluting with carbon less attractive. The best way to change big business is to change the market.

    Calling Australia's carbon pricing scheme a tax was all about politics.

    yet we pay a luxury car tax when its just another car everywhere else in the world apart from here

    In actual fact, Carbon can only be produced by very specific nuclear reactions which are, on this planet, extremely rare.

    However if you are talking about chemical reactions that involve carbon, then with carbon being one of the more abundant elementss around and an integral part of all organic compounds, then there is a huge scope for taxation. One of the most common example of this is breathing - just imagine a tax on breathing, wouldn't that be great?
    Of course this is not in any way production of carbon, merely the tranferring of carbon atoms from one compound into another.

      The advantage of taxing breathing would be that it would attack the heart of the problem - population - discouraging people from breeding.

        It would also discourage people going into politics with all that hot air in Canberra

      But you know what? Carbon that's buried in the ground in the form of coal isn't a problem. The problem is Carbon in the atmosphere. Burning coal means that Carbon that wasn't a problem is now a problem. Your post is technically correct, but entirely unhelpful.

    No no no. We don't need a stupid carbon tax. We just need more proactive measures. Every new building, new house or major renovation should have extensive solar panels, wind turbines and water capture tanks. Most of our electricity that we consume is through the day. If we can supply that power with green power it will reduce the amount of coal being burnt for power generation by over 50 percent. Replace street lights with LED's. There are millions of ways to make things more efficient and the law should be set up to encourage people and companies to change. Tax no. A tax will just get passed on and nothing will change.

    Thank you Elon! Citizens Climate Lobby (usa) has a proposal for a carbon fee and rebate. It starts small and includes an annually increasing price on carbon ( $20/ton, $10/ton annual increase) at the mine, well head, and border (import export offsets). ALL fees are returned evenly to each household in the country implementing the fee and rebate.

    And, you can't call it a tax if the money does not go to government. And, its not regulation or picking investment favorites. The rebate offsets higher consumer costs and the whole economy gets a nudge toward alternative energy production, efficiency, and carbon-reduced products (e.g. less plastic) .

    A well respected tax analysis company (lots of state government and corp clients), call REMI - Regional Economic Modeling Inc was paid their fee to study the proposal - and for the USA, over 20 years it would add 2.8 million jobs and cut CO2 emissions by half, fewer deaths, and more.

    CCL has national and international chapters and a national/international open conference call the first Saturday of the month. Call your Representatives, ask them for your CCL carbon rebate check!

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