Orissian businesses and consumers rely on an ethical energy policy that balances affordability with environmental responsibility. The differing energy needs of our finance sector and our fishing industry must be managed in a way that is beneficial to both parties. Using a combination of government action and emission management we address the issue of fossil fuels with this plan designed to incentivize green energy over time while managing emissions from currently existing energy sources. New buildings will be required to utilize some form of renewable energy to jumpstart renewable production.(Stokes) Rather than focusing on caps with carbon, as is standard (EDF), our focus will be pricing fossil fuels out of the market over time. By doing so we can ensure that the finance sector gets the energy it needs while the fishing industry is not negatively impacted by increasing energy needs. To that end we plan to implement the following:
Orissa will implement a cap-and-trade policy for emissions with the following stipulations:
- Each year the Orissian government will create a limited number of permits for the emissions of up to 4 tons of CO2.
- These permits will be sold using the following system:
o Permit price will increase at 10% of the previous year’s average sale price plus the rate of inflation. In the first year of sale this cost will be absent.
o 90% of Permits, C-permits are sold at a starting price of $2m dollars and all interested parties are allowed only one per issuing year. Unpurchased C-permits are folded over into G-permits.
o The remaining 10% of Permits, G-Permits, are auctioned off to the highest bidding companies. All interested parties can purchase as many of these as they want.
o The number of Permits issued is based on the total amount of emissions of the previous year -10%
- 20% of the total value of the initial C and G- permits sold per year will go to subsidies to promote the development of green energy alternatives. This includes any energy technology that produces less carbon than coal or gas OR any energy technology that shows a net neutral or positive effect on the surrounding environment.
o These subsidies will go to grants into research of green energy or the production of existing green technologies and their implementation within Orissa
o Green technologies with a positive environmental impact will be given freely to other parties with the stipulation that they build such systems within a reasonable time frame, based on the theoretical time it takes to build
- Orissa will implement a public trade forum for the purposes of buying and selling excess permit allotments with the following stipulations:
o All trades are public and include buyer and seller information
o All trades take a 10% reduction in the emissions allotment sold when transferred
o All trades incur a 10% monetary fee to be used to fund education in Orissa
o The price of C-permits cannot be less than the value of the previously purchased permits. G-Permits can be sold at any price.
- In the event a party exceeds their allotment of emissions and is unable, due to lack of supply, or unwilling to purchase additional capacity at market price they will be charged a tax equivalent to 110% of the market price and forfeit their C-permit eligibility for the next issuing year. Their eligibility for G-permits is not affected.
Gas and other fossil fuels for balanced energy use:
- Orissa imports gas from nearby countries
o The goal is only to use these imports for excess necessary energy needs
- Gas and other fossil fuel-based power plants must be kept away from fishing areas and residential areas
- Any fossil fuel-based power plant operating below 50% capacity must begin decommissioning over a 5-year period
Green Energy and Renewables:
- Orissa, as a nation with a thriving fishing industry, is concerned with and subject to the health of the surrounding environment. As such we have a keen interest in green energy, specifically such green energy with minimal environmental impact.
- Off coast wind farms in areas that do minimal harm to the local ocean ecosystem will be a priority going forward
- All new buildings are required to be equipped with solar panels rooftops and maintenance is required yearly by law. Established builds have either (1) five years to meet regulations or (2) any major redevelopment must include installation of solar panels.
- Orissa is very interested in partnering with other parties interested in developing green energy or alternative energy systems
- There will be tax incentives for green energy replacements of existing systems provided the following
o They entirely replace the functionality of the existing system with 100% renewable energy OR they substitute 60% of the existing system’s energy needs with green energy at a cost that is lower than the corresponding fossil fuel system
o Rollout should be possible without major shutdowns before the alternative system is up and running or near up and running
§ Near in this clause refers to one business day or thirty hours, whichever is shorter
o Priority is given to those replacements that either reduce the most energy consuming systems OR that produce more energy than the current system
With the above proposals we aim to price fossil fuels out of the market and fund alternatives while slowly transitioning to more sustainable energy sources with minimal effect on global energy prices.
Works Cited
Environmental Defense Fund. (n.d.). How cap and trade works. Retrieved April 6, 2022, from https://www.edf.org/climate/how-cap-and-trade-works
Stokes, Leah C., and Hanna L. Breetz. “Politics in the U.S. Energy Transition: Case Studies of Solar, Wind, Biofuels and Electric Vehicles Policy.” Energy Policy, vol. 113, Elsevier Ltd, 2018, pp. 76–86, https://doi.org/10.1016/j.enpol.2017.10.057.
Created by: John Shiver, Environmental Science Officer/Joint Chief Economist