Skip to main content

Current U.S. tax code has minimal effect on GHG emissions, National Research Council study finds

This article was published in Scientific American’s former blog network and reflects the views of the author, not necessarily those of Scientific American


A new report by the National Research Council finds that in terms of the scale of GHG emissions reductions required to mitigate anthropogenic climate change, the U.S. tax code has a minimal and mixed influence on greenhouse gas emissions.

The full report, which was commissioned by Congress, is available on the National Academies Press website for free (PDF).

The primary finding is that many of the tax expenditures and subsidies only deal indirectly with climate objectives. Most of the tax mechanisms have other goals: for example, promote production and consumption of certain fuels, like biofuels (aided by tariffs on biofuel imports). As the report notes, biofuels tax credits encourage consumption of liquid fuels because they lower prices, offsetting any potential GHG benefit from the biofuels.


On supporting science journalism

If you're enjoying this article, consider supporting our award-winning journalism by subscribing. By purchasing a subscription you are helping to ensure the future of impactful stories about the discoveries and ideas shaping our world today.


Production tax credits for renewable electricity generation have been an effective tool in terms of increasing the overall mix of renewable resources; installed wind generation capacity is hover around 12 gigawatts in Texas alone, with significant capacity in other states (and more due online from offshore farms). But the report cautions that the overall emissions reductions have been small, and costly per unit of GHG reduction.

However, If designed to directly address climate change objects, taxes could make a substantial contribution to reducing GHG emissions. Other studies have reached similar conclusions (for an overview of the economics of carbon pricing, see this earlier post “What economists say about carbon pricing”): one of the most reliable and economically efficient ways to reduce greenhouse gases is by assigning a price to carbon, either through a tax or an emissions trading scheme (which are really two means to the same end).

Download the full report here (PDF).

David Wogan is an engineer and policy researcher who writes about energy, technology, and policy.

David's academic and professional background includes a unique blend of technology and policy in the field of energy systems. Most recently, David worked at Austin Energy, a Texas municipal utility, implementing a Department of Energy stimulus grant related to energy efficiency. Previously, David was a member of the Energy & Climate Change team at the White House Council on Environmental Quality for the Obama Administration.

David holds two Master's degrees from The University of Texas at Austin in Mechanical Engineering and Public Affairs. While at UT, David was a researcher in the Webber Energy Group, where his research focused on advanced biofuel production to offset petroleum use in the transportation sector. David holds a Bachelor's of Science degree in Mechanical Engineering from The University of Texas at Austin, where he researched nuclear non-proliferation measurement technology.

David is a 2013 Aspen Institute Journalism Scholar, joining a select group of journalists from Slate, ABC News, and The New York Times.

David lives in Austin, Texas. Follow along on Twitter or email him at david.wogan@me.com.

More by David Wogan