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A coalition of UK health professionals has called for a carbon tax to be imposed on food with a heavy environmental impact, like meat, by 2025, unless the industry takes voluntary action on the impact of their goods.

In its new report, the UK Health Alliance on Climate Change (UKHACC) says that the climate crisis cannot be solved without action to cut the consumption of food that causes high levels of greenhouse gas emissions, such as meat and dairy products. It adds that more sustainable diets are healthier and would reduce illness. 

The UKHACC includes 10 Royal Colleges of medicine and nursing, the British Medical Association and the Lancet, representing doctors, nurses and other health professionals.

The report makes a series of recommendations, including calling for public information campaigns on diet to include climate messages, and putting labels on food to reveal its environmental impact. 

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Joseph Poore, at the University of Oxford, says that the latter recommendation is especially important. He says, “Today you can walk into a shop and buy something with an environmental impact many times higher than another food, and have no idea you have done so. For example, Brazilian beef uses 200 times more land and causes 80 times more emissions than European tofu.”

More importantly, the coalition says that we need to rethink the food system. Kristin Bash, who leads the Faculty of Public Health’s food group and is a co-author of the UKHACC report, says, “the climate crisis isn’t something we should see as far in the future. It’s time to take these issues seriously now.”

Additionally, the report calls for the UK government to levy a food carbon tax on all food producers if the industry does not take action by 2025 to reduce the environmental impact of its products, such as meat. Nicky Philpott, the director of UKHACC, said taxes on plastic bags and sugary soft drinks show that such policies can reduce harmful activities. 

Already, the NHS has set a target of cutting its net carbon emissions to zero by 2040 and included food in its action plan, saying that “healthier, locally sourced food can improve wellbeing while cutting emissions,” however the UKHACC believes that “the Government must do more to encourage, enable and support these changes.” 

Food production is responsible for a quarter of the world’s greenhouse gas emissions and studies have shown that red meat and dairy are more harmful than plant-based food. 

Bash clarifies that the report is not telling people to become vegans. “It’s just saying increase your consumption of plant protein. It’s a simple message and something that’s widely supported by health organisations around the world.” 

The abrupt collapse of tourism due to the coronavirus pandemic has again highlighted the inadequacy of resources for conservation in Africa. Carbon credits have been advanced as one possible source of new funding for Africa, but this market’s real potential to protect biodiversity is yet to be established.

A 2018 study of nearly 300 protected areas across the continent found that 90 percent of parks it looked at were severely underfunded. The parks surveyed have an estimated total spending shortfall of between $1 and $2 billion: there are 8,000 other protected areas in Africa.

Under pressure from governments, corporations, and communities pursuing one or another form of development, inadequately protected parks suffer ecological degradation, losing charismatic large species along with valuable habitat, which reduces the potential to generate tourism income in particular, and completes a vicious cycle.

Despite its high profile, tourism is not a major source of income for most protected areas on the continent, according to Max Graham, the CEO of Space for Giants, which works to make both economic and ecological value tangible for local communities in Africa: the significant in-flows come from philanthropy.

“The impact from [loss of] tourism is only going to be felt, from a conservation perspective, in a select grouping of parks that are either private or state-owned and operated in well-established tourism countries like South Africa and to a certain extent in Kenya,” said Graham.

He observed that conservation will likely continue to depend heavily on philanthropy as a crucial source of income in the future.

But attracting and retaining philanthropic support has its limitations. Donors sometimes insist on funding only narrow aspects of an organization’s overall work, or abruptly shift priorities away from a historic focus, said Graham. “Funding can also be difficult to secure at scale or over long periods,” he said.

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Carbon Credits as an Alternative Solution

Matthew Brown, the Africa director at The Nature Conservancy (TNC) says there is huge potential to fund conservation through the sale of carbon credits. By the end of 2016, $300 million of carbon credits had been sold on voluntary markets; Africa accounted for just $20 million of this global total.

The potential to fund conservation through carbon credits may now be growing. In 2018, there were $172 million worth of voluntary market carbon credit transactions, according to a self-reported survey of carbon traders conducted by Ecosystem Marketplace, an information hub focused on market-based approaches to conservation. Fifty-eight percent of this total went to forestry and land use programmes – though this figure includes an extraordinary increase in REDD+ (reducing emissions from deforestation and forest degradation) credits involving just one country, Peru.

In Africa, TNC has been supporting a REDD project on 32,000 hectares (80,000 acres) in the semi-arid savannah of the Yaeda Valley, in northern Tanzania, for the past five years.

The valley is home to indigenous Hadza hunter-gatherers, as well as Sukuma farmers, and Datoga agro-pastoralists. Working with English conservationists Marc Baker and Jo Anderson, the Hadza secured legal recognition of 20,000 hectares in the heart of the valley as their territory in 2010, and entered a 20-year contract with Baker and Anderson’s company, Carbon Tanzania, to sell offsets from a REDD+ project.

Critics of carbon credits and REDD argue that very few such projects are able to generate significant income for local communities, with carbon prices too low to incentivise people to protect them over time.

Brown counters that these markets are growing fast, fuelled by growing numbers of corporations seeking carbon offsets to fulfill public pledges to become carbon neutral. “Globally, in 2018, the size of the voluntary market doubled and, in 2019, doubled again. In 2020, it was expected to double once more – before Covid-19.”

Last year, the Yaeda Valley project earned $95,000 for Hadza communities. This income was used to train 30 village game scouts, create 100 jobs for locals protecting habitat, pay school fees for 30 children, and improve healthcare in the valley.

REDD has also been challenged for failing to represent additional prevention of greenhouse gas emissions from deforestation. While this is clearly not the case with the Yaeda project, a French research centre examined 120 carbon credit projects in 2015 and found that 37 percent overlapped with already existing protected areas.

Storing Carbon, Protecting Biodiversity

Another important question is whether REDD protects not just carbon stocks, but biodiversity. On this score, the Yaeda Valley is an ambiguous example.

Walking transects were carried out in both REDD+ and less-regulated areas of the valley every year from 2015 to 2018 to monitor mammal species including elephants, cheetahs, wild dogs, and giraffe (Giraffa camelopardalis). Researchers found species richness and the density of wildlife was higher in woodland areas of the valley — REDD+ protected or not.

The researchers credited the project with protecting vital habitat, while pointing to other factors likely contributing to maintaining biodiversity, including multiple habitats within a large study area, and access for wildlife to adjacent protected areas such as the Ngorongoro Conservation Area, allowing animals to move in and out of the area.

They also noted that village game scouts paid for by the REDD programme also patrolled project areas to enforce anti-poaching laws and recommended more formal integration of conservation goals in the design and implementation of REDD+ projects like this one.

While acknowledging the potential of carbon credits to fund conservation in Africa, Graham said the carbon trading sector is very complex and expensive. “There are also questions over state-run parks, which are the majority,” said Graham. “Once a deal is done and money starts flowing, will that flow to the park or to the government agency for wider spending?”

This article was originally published on Mongabay, written by Mantoe Phakathi, and is republished here as part of an editorial partnership with Earth.Org. 

 

The complexities of global trade raise questions about how best to address the way countries fairly compensate for their environmental impact on others. Pricing carbon, specifically through a carbon tax, is one such way to address these equity issues and reduce global carbon emissions. 

What is Carbon Pricing?

Carbon pricing is an approach to reducing carbon emissions that uses market mechanisms to pass the cost of emitting to emitters. Its goal is to discourage the use of fossil fuels, address the causes of the climate crisis and meet national and international agreements. 

Well-designed carbon pricing can change the behaviour of consumers, businesses and investors while encouraging technological innovation and generating revenue that can be used productively.

There are a few carbon pricing instruments, such as a carbon emissions tax and cap-and-trade programmes. 

Current Situation on Carbon Pricing and Carbon Tax

The International Monetary Fund, the Organisation for Economic Co-operation and Development (OECD) and others have recommended more stringent fiscal measures to reduce emissions, such as increasing the carbon price or taxation to further incentivise corporations to reduce their emissions and align themselves with the Paris Agreement goals. However, with these plans arise not only political complications such as aligning inconsistent national policies with international trade, but also the issue of equity. With 50% of carbon emissions attributed to the richest 10% in the world, and 10% of emissions attributed to the poorer 50% of the world, it raises the question of who contributes to the climate crisis and who really suffers the consequences of it. 

A fair system must be developed, one that acknowledges and compensates for the fact that wealthy nations emit far more carbon than poorer nations, who suffer more from the impacts of the climate crisis. Termed ‘carbon inequality’, efforts are being made to tackle environmental and social injustices through political and economic means. 

The discussion around not only pricing and taxing carbon, but developing fair climate policies is not a new one, however there is an increased focus on the degree of responsibility a country should take- how much countries should be paying, and to whom.

At UN climate negotiations in 2018, Chinese delegate Xie Zhenhua addressed the mismatch of cause and consequence between developing and developed countries. He said, “developing countries are not comfortable or happy. We need to see if developed countries have honoured their commitments. Still some countries have not started their mitigation efforts, or provided financial support to poor nations. We strongly urge them to pay up on their debts.”

carbon tax

Carbon pricing policies in selected countries (Source: Statista)

Carbon Taxes Around the World

A carbon tax is imposed by a government and is defined by per-tonne tax on the carbon emissions embedded in fossil fuels or other products. It puts a direct price on greenhouse gas (GHG) emissions and creates a financial incentive to lower emissions by switching to more efficient processes or cleaner fuels. 

Cap-and-trade systems such as the EU Emissions Trading System (ETS) impose a cap of GHGs that can be emitted every year, called ‘carbon credits’. Those industries with low emissions can sell their extra allowances to larger emitters. This supply and demand for emissions allowances establishes a market price for GHG. The cap helps ensure that emission reductions will take place to keep emitters within their pre-allocated carbon budget.

A national carbon tax is currently implemented in 27 countries around the world, including various countries in the EU, Canada, Singapore, Japan, Ukraine and Argentina. However, according to the 2021 OECD Tax Energy Use report, current tax structures are not adequately aligned with the pollution profile of energy sources. For example, the OECD suggests that carbon taxes are not harsh enough on coal production, although it has proved to be effective for the electricity industry.

A carbon tax has been effectively implemented in Sweden; the carbon tax is USD $127 per tonne and has reduced emissions by 25% since 1995, while its economy has expanded 75% in the same time period. 

Where Should the Money Go? 

With some carbon tax systems already in place, core criticisms around carbon pricing instruments centre around public trust in the system. Despite long-term environmental benefits, surveys shows that individuals are concerned about how their daily lives will be affected and where revenue will be directed. For example, some concerns include the belief that carbon pricing will add further financial stress on the elderly and those in poorer households by increasing the cost of energy. 

Another survey conducted by Nature with 4997 participants in Australia, India, South Africa, the US and the UK proposed different hypothetical carbon tax mechanisms to examine their public’s acceptance to them, whereby ‘funding for mitigation projects worldwide’ received the highest support.

To make carbon taxes politically feasible and economically efficient, governments must choose how to use the revenue. Options include cutting other kinds of taxes, supporting poorer households and communities, increasing investment in green energy or by giving the money back to people as a dividend.   

These concerns are already being addressed in some countries such as Switzerland, where residents receive their dividend as a rebate on a compulsory health insurance. Canada’s incoming federal scheme is aiming for 90% of the carbon tax revenue to be returned to residents. 

Lack of a Common Commitment 

On committing to the Paris Agreement, UN Climate Chief Christiana Figueres said that countries are not looking to save the planet for altruistic reasons. “They’re doing it for what I think is a much more powerful political driving force, which is for the benefit of their own economy,” she said. 

There is a disparity between the interconnected global economy and the disparate carbon policies in different countries (some with carbon tax, some implementing cap-and-trade systems, some without a system in place at all). For example, the EU uses their ETS system, yet the majority of the US has yet to implement a carbon tax. These factors make equilibrating the different carbon-pricing schemes on a global basis challenging yet crucial if equity is to be achieved. 

Economist Peter Cramton and colleagues emphasise that current ‘pledge-and-review’ processes that came from the Paris Agreement are based on self-interest and that responding only to domestic concerns will not be enough to address the problem at hand. He mentions that Paris was successful in that a collective goal was set, but that individual contributions do not add up. 

Another iteration of carbon taxes being discussed is carbon border taxes, as discussed in the EU’s ‘European Green Deal’, which imposes a fee on any product imported from a country that does not have a carbon pricing plan in place. Criticisms about the border carbon tax say that it would discourage international collaboration rather than encourage it.

Is a Shared Responsibility Approach Necessary for Carbon Taxes?

Cramton believes that reciprocity is key in developing policies that drive global climate cooperation. He uses an analogy of a game with a common pot of money; each country has $10, some or all of which the players may simultaneously pledge, and for every $1 (for carbon) that is put into the pot, it is then doubled (by natural climate benefits) and the surplus is redistributed to the recipients.

A referee ensures that they honour their pledges. If individuals are allowed to choose their contributions into the pot, a self-interested member may contribute nothing because they will still reap the benefits, relying on others to contribute to the pot. 

However, with a common commitment version of the game, players condition their contributions on others’ pledges: the referee ensures that they all contribute the amount of the lowest pledge. It is a reciprocal, co-dependent model, but does not say what everyone must do – an ‘I will if you will’ mentality.

No one is forced to contribute more than expected, yet everyone gains. If countries are completely selfish, they cannot lose but only gain if they pledge the lowest pledge. Common commitment policies can convert selfish behaviour from ‘contribute nothing’ to ‘contribute everything’ because the concept protects against free riding. 

To supplement Cramton’s view, a study posits that to be fair for both developed and developing nations, there needs to be a shift away from a production-based approach to a shared responsibility approach in the form of carbon emission ‘burden-sharing schemes’. The production-based principle means that a country should be responsible for all the emissions generated by its production activities within its borders.

The study views this method as outdated in the context of globalisation because it does not take international trade into account. For example, developing countries such as China would take the burden of carbon emissions associated with exporting goods to developed countries. 

Uniform Carbon Pricing

The lack of a central body regulating the implementation of such carbon pricing strategies around the world also hinders this issue of equity. Carbon pricing has been demonstrated as the preferred climate policy instrument, and would also be beneficial to promote international cooperation. To implement carbon pricing globally though, research suggests a ‘global system of harmonised carbon taxes’ rather than one unified global tax so that countries can retain control over revenues. 

Cramton believes in the implementation of a uniform carbon price instead. He compares setting different carbon prices to setting speed limits, saying that “if drivers chose their own speed limits, there would be no use enforcing them because everyone would drive at their desired speed.”

To ensure that enforcement strengthens a collective rather than an individual effort, Cramton proposes a global carbon price commitment decided by a voting majority. It would allow a country to choose how it complies, via taxes, cap-and-trade, or other schemes, as long as the country’s average carbon price (cost per unit greenhouse gas emitted) is at least as high as the agreed price. 

Incentive Fund 

In conjunction with the suggestions above, Economist Raghuram Rajan suggests the creation of a global incentive fund. Rajan posits that there should be a system in place where countries that produce emissions above a defined carbon threshold should have to financially compensate those countries that produce emissions below it.

Essentially, countries that emit more greenhouse gases than others should pay into a fund that rewards low emitters (for example through the Green Climate Fund). Critics of this optimistic, yet idealistic system suggest that it is oversimplistic, failing to take into account other factors such as population growth, existing ecosystems, biodiversity and GDP.

What’s Next For Carbon Tax?

Carbon taxing is just one way of holding large emitters accountable for their role in harming the environment. It represents a departure from the West’s traditional model of letting market forces guide decision-making by allowing governments to mandate emission targets, which is one of the reasons it hasn’t been as widely implemented around the world as it should be. However, if the planet is to have any hope of meeting the Paris Agreement goals, drastic measures that consider both the economic and social wellbeing of nations’ inhabitants must be taken.

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