Would consumers still have an incentive to conserve energy?
Absolutely. They would face higher prices for energy-related products and would therefore have a strong incentive to conserve and seek out energy efficiency improvements. The idea is not to hold down utility bills artificially, but rather to prevent a loss in consumers’ overall purchasing power. This would lead to the best of both worlds — incentives to conserve would remain, while families’ budgets would be protected. Why are rebates more effective than relying on utility companies or LIHEAP? An alternative approach to consumer relief — providing billions of dollars to utility companies to artificially suppress increases in electric and gas bills that would otherwise occur under an emissions cap — is ill-advised. Over half of the increase in costs that consumers would face under an emissions cap would be for energy-related costs other than home utilities (such as gasoline and goods and services with energy inputs). So keeping households’ utility bills down would still leave vulnerable
