Carbon Quotas

An equitable approach to inevitable rationing

by Seth Klein

Credits: Illustration by Meital Smith (right), inspired from the Canadian WWII wartime poster by Joseph Sydney Hallam (left).

“Dig on for Victory!” declared wartime posters urging people to plant Victory Gardens. [Ed: The campaign was launched in Britain as soon as WW2 started in 1939.] The changes in household consumption and recycling during the war years weren’t only important to save scarce resources — they also gave everyone a sense that they were part of the collective war effort.

That history of how households rallied to the cause can inspire us today. Modern urban agriculture movements have found a muse in Victory Gardens. The urban farming group Action Communiterre in Montreal’s Notre-Dame-de-Grace neighbourhood has a Victory Garden network. Knowing how wartime families shifted their transportation habits and conserved energy and fuel can motivate us to rethink our practices today.

But if we are unable to dramatically bend the curve on our greenhouse gas emissions very soon, more radical measures will be needed, modelled on the household rationing of the war. We might well need to implement carbon quotas. Under this approach, we would calculate Canada’s fair allotment of the world’s remaining carbon budget, allocate a certain share to government (which in turn would be divided among the various levels of government), a certain amount to various industries and the remaining share to households, to be equitably apportioned.

Unlike in the war, rationing would not be needed for specific goods such as natural gas, vehicle fuel, meat, or air travel. Instead, households and companies could be allotted annual “carbon quotas” for purchasing any fossil fuel. Those quotas would decline each year, in line with our society’s overall GHG reduction targets. A model like this still gives households choices about how to “spend” their carbon quotas – if air travel is important to you, you can concentrate your quota there and eat less meat; if you really love meat, you can travel less; etcetera.

A carbon rationing system isn’t only valuable for reducing GHGs – it also strongly communicates that everyone is doing their equal part, as occurred in the war.

Such a system is technically possible. The carbon content of fossil fuels is already well known and reflected in the carbon tax one pays when filling up a car with gas or paying a home utility bill. But businesses can also calculate the carbon embedded in the goods and services we purchase, and these could be reflected next to the sticker prices we have long known (or simply be embedded in overall prices). Households or individuals could be granted carbon debit cards to operationalize the system, effectively resulting in a parallel carbon currency.

I first encountered this model in British writer and climate champion George Monbiot’s book Heat: How to Stop the Planet from Burning, in which he outlines how a system like this could work. As Monbiot highlights, a carbon rationing system isn’t only valuable for reducing GHGs – it also strongly communicates that everyone is doing their equal part, as occurred in the war. It helps to build the sense of social solidarity discussed earlier.

And a carbon quota system has an additional benefit over a carbon tax/price. Carbon pricing in itself is regressive – the cost impacts lower-income households more as a share of their income, while the rich can simply continue to emit as much carbon as they wish and pay the tax (which the wealthiest would hardly notice). The regressive nature of carbon taxes can be mitigated by way of a lower-income carbon credit. But a carbon quota avoids this dilemma entirely – all households are given their fair and equal allotment of carbon rations, regardless of income. A carbon quota/rationing system thus has the benefit of both equity and simplicity.

Monbiot contends that this model would preserve more individual “freedom” than a purely regulatory approach that tells people what we must do and monitors our choices and behaviours. Moreover, he argues, “the market created by carbon rationing will automatically stimulate demand for low-carbon technologies, such as public transport and renewable energy.” But even in this equitable model, lower-income households that live, for example, in poorly insulated homes, would still need financial support to make needed transitions.

Any way you cut it, though, as the use of fossil fuels is forced down and the commodity becomes increasingly scarce, there will be some form of rationing. The only question is whether we will have rationing determined by who can pay the escalating price, or some more equitable approach.

Excerpted from A Good War: Mobilizing Canada for the Climate Emergency by Seth Klein. Seth Klein is a public policy researcher and writer based in Vancouver, BC.

Book cover: A Good War by Seth KleinA Good War: Mobilizing Canada for the Climate Emergency
Seth Klein
ECW Press, Toronto, 2020
434 pages, pp $24.95
ISBN 978-1-77041-545-4

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