Perverse opportunity: IL, other states pollute so much more than current cap-and-trade states

By Dan Johnson

Illinois pollutes more than California.

And Indiana pollutes more than Illinois.

Those two pieces of data floored me. 

Here's the list, by state, of greenhouse gas pollution:

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The top 10 states with the most pollution, in rough order and with rough estimates from the 8/18/14 reports to the EPA of 2013 Greenhouse Gas Emissions from Large Faciliities, are

1. Texas, 410M tons
   
2. Indiana, 150M tons
3. Pennsylvania, 148M tons
4. Illinois, 140M tons
5. Louisiana, 138M tons
6. Ohio, 136M tons
7. Florida, 125M tons
8. California, 110M tons
9. Kentucky, 108M tons
10. Alabama, 101M tons

California  is the only one of the top top states to charge polluters. Washington State only has 25 tons of pollution! And if that program goes through, they on track to raise a billion dollars from charging the market price for carbon pollution.

What an opportunity for these other 9 states!

The people in those states have more fuel, so to speak, for a successful marketplace for a price for pollution, because there's so much more of it. They're leaving lots of money on the table today (Texas could have an annual $4 billion program at $10/ton). And it's so much better to tax pollution than, say, sales of food or income. 

Another way to look at this chart is how much we're currently subsidizing polluters (at $10/ton to make the math easy) by not charging them anything for their pollution, by state. And another way of saying the same thing is how much more of a tax burden we're putting on families in each of these states because they are forced to make up for the lack of pollution fees that the polluters aren't contributing to the public sector.

It may be perverse, but all this pollution creates a great opportunity for better policy!