Using the Carbon Dividend Calculator

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This training walks through how to input information into the Carbon Dividend Calculator tool that will allow the Calculator to compute your household dividend and make a “default” estimate of what the carbon fee will cost a typical household with those characteristics. 

TOC and Guide Section
What is the Personal Carbon Dividend Calculator?

The Carbon Dividend Calculator is an easy-to-use online tool to estimate the financial outcome of the policy for an individual household under the first-year carbon dioxide fee of $15 per metric ton. It’s a way to take the abstract statistical findings of the Household Impact Study down to the personal level.

This online calculator allows anyone in the U.S. to estimate the first-year financial impact of the Energy Innovation and Carbon Dividend Act on their personal budget. The calculation is based on where you live, your family size, and your self-reported income and expenditures on things like gasoline, electricity and natural gas. It is an estimate -- your actual results may vary depending on your actual consumption patterns. 

How are the numbers calculated?

The Personal Carbon Dividend Calculator produces two numbers to give you a personalized estimate.

  1. Your Carbon Fee Cost. The carbon fee is a charge imposed on producers of fossil fuels at an initial cost of $15 per metric ton of CO2.that will result when they are burned. The fees will be collected into a Carbon Dividend Trust Fund and then divvied out to American households in the form of a monthly carbon dividend payment (see below). The carbon fee will impact you because much of the cost paid by fossil fuel producers will be passed on to consumers, so you’ll pay higher prices for things you consume -- gasoline, electricity, food, clothing and other things that contribute to climate change. In order to calculate how much you’ll pay, we first ask you to answer seven questions -- household income, living arrangement, number of adults and children, zip code, housing type, number of vehicles, and heating fuel type. The calculator estimates your costs based on the typical energy habits of a household with your income and household size in your zip code. In another step, you can adjust three of these costs -- gasoline, electricity, and home heating -- to match what you normally pay. If you don’t know these costs, don’t worry! You can just go with the averages generated by the model, or come back with those numbers later to make the results more accurate.
  2. Your Carbon Dividend. The carbon dividend is a monthly payment that will be distributed to households every month -- think of it as your share of the payback for damage to our climate caused by fossil fuels. We calculate this by estimating the total amount that producers of fossil fuels pay into the Carbon Dividend Trust Fund, and then divide it up among the U.S. population according to the number of eligible adults and children. Your household size determines your share, and your income helps estimate your typical carbon footprint and income tax, so the calculator can determine your estimated after-tax monthly carbon dividend. In the final screen, you will see your household’s  estimated after-tax carbon dividend, an estimated total of your carbon fee costs, and finally the estimated bottom-line gain or loss, which is your estimated dividend less your estimated carbon fee costs.

What is the purpose of describing my ‘Living Situation’?

To make the best possible estimate of both carbon fee costs and carbon dividends, some information about living arrangements is needed. The more people share a residence (house, condo, or apartment), the lower the per-person electricity and heating costs are likely to be. In some cases, an individual or family group might share their residence with others who receive their dividends separately  and perhaps pay a portion of utility costs, so the calculator needs to know this in order to allocate both dividend amounts and carbon costs as accurately as possible. 

What about 'indirect' carbon costs like food, clothing, etc.?

Indirect carbon fee costs, referring to CO2 that is emitted during the production of other goods and services like food, electronics, clothing, etc. are included in the calculations. These costs account for 50 to 60 percent of carbon costs for most households. Direct carbon fee costs, on the other hand, denote the money you spend on energy you use directly -- gasoline, electricity, and natural gas or other heating fuel.

How precise are these results?

If you have accurately entered your  gasoline, electricity, and heating bill costs, the result has a margin of error equal to about $18 per month. For example, if the Personal Carbon Dividend Calculator estimates a net benefit of $50 per month, there is a 90 percent chance your actual outcome will be a net benefit in the range of $33 to $67 per month. This range of carbon costs is given in the final screen titled “Your Results.”

What data sources are used to estimate the numbers?

The data sources are the same as those used in the Household Impact Study, and the Calculator was designed in collaboration with the author of that study. Although the study was based on 48 household data types that affect carbon footprint, the calculator asks users for seven inputs that are easy to recall and demonstrate good ability to predict a household’s carbon footprint. 

Federal databases were used to compute total carbon fees collected, population of adults and children, energy costs and carbon intensity by zip code, typical heating costs, etc. Incomes have been inflation-adjusted to the year 2018.

What if my lifestyle is not 'typical' for my income level?

If you know your direct energy costs like gasoline, electricity, and home heating for the previous year, you can fine-tune the results for those costs using 'sliders' provided in the Personal Carbon Dividend Calculator. If, for example, you don't drive much or your vehicles are more fuel-efficient than average, your carbon fee cost will be lower than an average household with characteristics similar to yours. There are other lifestyle factors, like diet, that the calculator does not attempt to account for.

How do I calculate my monthly gasoline, electricity, and heating costs for the ‘sliders’?

Accurately entering those direct energy costs will make your results more accurate. For electricity and heating, add up your monthly utility bills for the previous year and divide by 12. 

It's important to add up the entire year to account for seasonal changes, which can be very substantial. For gasoline, there are various ways to estimate (e.g., miles driven x average pump price ÷ mpg; or just add up your receipts for, say, 3 months and then divide by 3). 

These calculations don't have to be precise, but the closer you come to your actual costs, the more accurate your carbon costs will be. If you are sharing your home with other ‘housemates’ who receive their own dividends and split utility costs, make sure to adjust the electricity and heating  sliders to the portion you are responsible for.

Do these numbers account for income tax on the dividend?

Yes, the Dividend shown in the results is the dollar amount after federal income taxes have been taken out, assuming federal tax rates for a typical household described by the user’s inputs. State and local taxes, however, are not included in the calculation. 

Can the Personal Carbon Dividend Calculator show results beyond year 1?

No. After the first year, changes in key factors such as household income, tax laws, vehicle efficiency, carbon intensity of grid power, etc. are too numerous and too large to predict with enough accuracy. 

As a rule, the household carbon dividend and household carbon costs will go up together in proportion to the increase in the carbon fee. Over time, both of these growth rates will slow down, level off, and eventually fall as our energy systems are decarbonized. In the meantime, any given household may find ways to reduce its carbon footprint to improve their bottom line. 

What about air travel?

The Personal Carbon Dividend Calculator assumes a carbon cost for air travel that is typical for a household with the characteristics entered by the user. It's worth noting that although air travel is carbon-intensive, it only accounts for about 2 percent of total U.S. greenhouse gas emissions. Most of our carbon footprint is still in everyday energy usage and embedded in the things we buy. 

What about energy-consuming items that are not covered in the query, like a second home or a boat?

These can be accounted for by fine-tuning the direct energy cost 'sliders' for gasoline, electricity, and heating. Simply include those costs in the annual total used to calculate a realistic monthly average. For instance, if you own a speedboat, the cost of gasoline should be added into your monthly average, taking into account that it’s only used for part of the year. 

What if I have solar panels on my home?

If you have your own solar array (or wind turbine), do not include any lease or financing costs for that equipment in your electric bill. When adjusting the ‘average monthly electric bill’ slider, only include the cost for the power you buy from the utility. Remember that the calculator knows how ‘green’ the utilities are in your area, based on your zip code, but has no way of knowing how much electricity you generate yourself.  

What if I have signed up for electricity from a renewable power supplier?

Accurately accounting for this would require a little extra work on your part. If you can obtain a carbon footprint report from your power supplier and a comparable report from the major electric utility in your area, you can calculate a ratio of the green power to the not-green power. 

Let’s say your renewable power supplier’s carbon footprint is 200 g CO2 per kilowatt-hour, and your conventional utility is at 800 g CO2 per kilowatt-hour. The ratio is then 200/800 = 0.25. You can multiply your average monthly electric bill by that ratio and then adjust the electricity slider accordingly. This will improve the accuracy of your carbon costs prediction. 

What if I heat with electricity, and have no separate utility bill for heating?

The drop-down box for ‘What kind of fuel is used most to heat your home?’ includes Electricity as one of the choices. If you select that for your household, you will see in the next step that there is no slider for heating fuel -- it’s contained in your electric bill.

What would be the impact of a low- or no-meat diet?

The Energy Innovation Act Calculator does not have a specific input for this factor, but information is available to estimate it (see table in next FAQ). For example, compared to beef, the carbon cost of fruits and vegetables is about 30 percent lower. About 10 percent of the average family’s carbon fee cost is associated with food, so if meat made up half of your diet, completely eliminating it might reduce your total carbon cost by 1 to 2 percent, depending on the specific changes you make. Of course, as the Carbon Fee increases, the dollar savings for eating less meat would increase proportionately.

What about  other household characteristics that are not requested by the tool? 

Those are additional lifestyle characteristics, such as air travel and diet, that can also affect our carbon footprints. Their impacts are estimated in the carbon cost calculations based on the 7 main inputs (number of adults, number of children, income, zip code, housing type, vehicles, and heating fuel), but attempting to fine-tune them further would be an onerous task – for example, requiring a user to track down receipts for every food or clothing purchase made during the year!

If you want to get a general idea how reducing different kinds of expenditures would impact your carbon costs, you can use the table below to do so. 

Here is an example of how to calculate that: Reducing one's air travel expenditure by $100 would, on average, reduce that person’s cost from the Carbon Fee by about $1.66 – that is, $100 × Carbon Intensity (1.104) × Carbon Fee ($15)  ÷ 1000 kg per metric ton.


Expenditure category

Carbon intensity,
kg CO
2 per dollar

Expenditure category

Carbon Intensity,
kg CO
2 per dollar

Air travel




Laundry & cleaning supplies


Major appliances




Personal care




Fees & admissions




Vehicle maintenance & repair


Poultry & fish


Alcoholic beverages


Other food at home


Food away from home




Small appliances & housewares


Other entertainment misc.


Personal services


Household textiles


TV, radio, & sound equipment


Nonalcoholic beverages


Vehicle rental, licenses, etc.


Cereals & baked goods


Tobacco products


Fruits & vegetables


Telephone services


Misc. household equipment


Personal insurance & pensions


Pets, toys, playground equipment


Home insurance


New car & truck net outlay




Press play to start the video (22m 31s)
Video Outline
From October 3, 2019
To skip ahead to a specific section go to the time indicated in parenthesis.

Intro & Agenda  (from beginning)

What is the Calculator? (2:20)

What's been updated? (5:39)

Where can I access it? (8:43)

Calculator Case Studies (10:42)

What about negative results & how do I use it? (19:14)

  • Rick Knight
  • Bryan Hermsen

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Press play to start the audio (22m 37s)
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Audio Outline
To skip ahead to a specific section go to the time indicated in parenthesis.

Intro & Agenda 
(from beginning)

What is the Calculator? 

Where Can I Access it?

Using the Calculator 

Calculator Case Studies 

Interpreting Net Loss Results 

Final Takeaways

Rick Knight
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