Effect of carbon tax on homeowners

I had a difficult conversation with a homeowner yesterday at a tabling event. She is trying to “do all the right things”: installing heat pumps, electrifying her house, etc. And she feels frustrated because it will cost $25,000 to do it all. She knows that not everyone can afford that: she can't afford to do it all herself anyway.

We spoke of systemic change vs the burden on the individual. And I spoke of the costs we are already paying: in health, global overheating, etc. But the actual cost may still fall on the homeowners, and for middle income folks, that's hard.

I could see how a carbon tax will motivate homeowners as the cost of heating oil and natural gas begin to rise…it will be worth it to spend $25,000 because it will be MORE expensive to keep burning fossil fuels. But that's not exactly comforting, is it?

What have others responded in situations like this? What's the truth of the matter here?  

I'm a condo owner myself and stick with the current standard (natural gas) because I'm urban anyhow: the city needs to change, basically.  Not all of us in the city can get rooftop solar. And heat pumps create ambient noise, a side issue, but an important one. 

But at some point, there may be some $$ outlay for the switch over, and that will fall on the owners, won't it? 

4 Replies

Hi @Tami Kellogg. In that scenario I'd first point to the IRA's incentives for homeowners to electrify and make their homes more efficient. There are tax credits available to everyone, and soon there will be upfront rebates available to help low- and middle-income households. On the subject of a carbon tax specifically, well, that's why we advocate for carbon cashback, so that low- and middle-income households will get a net income from the system 🤓

Another idea is that people can wait a few years until their existing systems are getting old and will need to be replaced soon anyway. In that case there will be a cost one way or the other, and so then it makes sense to be proactive and replace aging fossil fuel appliances with electric alternatives that are more efficient and cleaner, and will save money over time due to lower monthly energy bills. Especially if they can take advantage of these IRA and perhaps also state and local incentives.

George Donart
144 Posts

@Tami Kellogg I would also point out that a CF&D dividend will pay for a lot of upgrades pretty quickly, both in lower bills and speeding pay off of a home improvement loan.

@Tami Kellogg, as George D says, the carbon dividend – as always – is the key. In fact, a good way to put it is that it's the key that unlocks the toolbox of climate solutions. Individuals should not be made to feel that the burden of solving climate change falls on them personally. With a CF&D, the burden falls on the polluting industries, and the household that receives the dividends can then decide how they want to spend it. If they can afford to spend it making their homes less polluting, that's fine! But no guilt if they cannot!

@Richard Knight Hi! And thanks for your answer to my question. 



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