Energy Innovation and Carbon Dividend Act of 2023

Energy Innovation and Carbon Dividend Act of 2023

This bill imposes a fee on the carbon content of fuels, including crude oil, natural gas, coal, or any other product derived from those fuels that will be used so as to emit greenhouse gases into the atmosphere.

The fee is imposed on the producers or importers of the fuels and is equal to the greenhouse gas content of the fuel multiplied by the carbon fee rate. The rate begins at $15 per metric ton of CO2-e (i.e., carbon dioxide equivalent) in 2023, increases by $10 each year, and is subject to further adjustments based on the progress in meeting specified emissions reduction targets.

The bill also includes

• exemptions for fuels used for agricultural or nonemitting purposes,
• exemptions for fuels used by the Armed Forces,
• rebates for facilities that capture and sequester carbon dioxide, and
• border adjustment provisions that require certain fees or refunds for carbon-intensive products that are exported or imported.

The fees must be deposited into a Carbon Dividend Trust Fund and used for administrative expenses and dividend payments to U.S. citizens or lawful residents. The fees must be decommissioned when emissions levels and monthly dividend payments fall below specified levels.

The bill also requires the Department of Energy to enter into agreements with the National Academy of Sciences to study and report on various impacts related to the carbon fee and emissions reduction schedule established by the bill.

The Energy Innovation and Carbon Dividend Act of 2023, also known as Bill 118 hr 5744, is a piece of legislation introduced in the US Congress aimed at addressing climate change and reducing carbon emissions. The bill proposes a carbon fee and dividend system, where a fee is imposed on carbon emissions at the point of extraction or importation, and the revenue generated is returned to American households in the form of a monthly dividend.

The goal of the bill is to incentivize businesses and individuals to reduce their carbon footprint by making carbon-intensive activities more expensive, while also providing financial relief to American families to help offset any potential increase in energy costs. The bill also includes provisions for funding clean energy research and development, as well as supporting communities that are disproportionately affected by the transition to a low-carbon economy.

Supporters of the Energy Innovation and Carbon Dividend Act argue that it is a market-based solution to addressing climate change that will help drive innovation and create jobs in the clean energy sector. Critics, however, raise concerns about the potential impact on industries that rely heavily on fossil fuels, as well as the potential for the carbon fee to be passed on to consumers in the form of higher prices for goods and services. Overall, the Energy Innovation and Carbon Dividend Act of 2023 represents a significant effort to address climate change and transition to a more sustainable energy future. Its success will depend on the ability of policymakers to strike a balance between reducing carbon emissions and supporting economic growth.