Carbon tax - a levy on pollution whose time has come

A carbon tax is a levy on pollution, for the relative cost to humanity of the use of fossil fuels. This cost cannot be tabulated in exact terms, for it’s the accumulated cost of the damage to the environment, human health, and related costs of the use of fossil fuels that can only be estimated. The carbon tax itself is a fee on the production and distribution of fossil fuels. The government sets a price per ton on carbon, then that translates into a tax on oil, natural gas or such things as the electric bill.
Businesses and utilities then have the incentive to reduce consumption, and/ or maintain the market price and absorb the cost of the tax, or pass the added fee on to individual consumers. Individuals would then have the incentive to reduce consumption, increase their energy efficiency habits or face a steeper cost for energy and gas.
The principle of mitigating negative externalities (such as the damage caused by fossil fuels), and having the relative costs of pollution paid for, is the primary purpose of the carbon tax. Who bears the ultimate burden of the tax is a hypothetical question that has a couple of answers. The businesses that produce and distribute fossil fuels should consider bearing the brunt of the tax. In practice, individuals pay more.
A carbon tax is enacted to lower greenhouse-gas emissions. Public transportation, energy efficiency products, and things like clean coal technology become great alternatives to traditional means. One other benefit of a carbon tax, besides the incentives to reduce consumption and increase energy efficiency, is the increased attractiveness of the cost of alternative energy, which is made closer to cost parity with fossil fuels.

Denmark, Finland, Germany, Ireland, Italy, the Netherlands, Norway, Slovenia, Sweden, Switzerland, and the UK have all successfully implemented a partial carbon tax on some goods and services, while not being able to implement a broad, universal carbon tax. Generally, reports of lower greenhouse-gas emissions follow the passage of a carbon tax. In addition, India and Australia, among many other countries, have also successfully enacted carbon tax policies. The province of British Columbia, in Canada, has reported drops of around 5% annually of greenhouse gas emissions due to its aggressive carbon tax policies. 

District Heating and geothermal district heating in Iceland

District heating has become the favored method of heating in many cities in Europe. It has also risen in popularity and use throughout much of the rest of the world. This idea is actually more than 100 years old. It started in 1903 in Moscow, Frederiksberg and Copenhagen, all in the same year.

District heating systems as a modern concept were designed and introduced in the 1980's (with constant breakthroughs since then), with automatic control, remote monitoring and unmanned operations. The concept binds together available heat sources which otherwise would be wasted for heating or to produce cooling.

Many district heating networks use cogeneration, or combined heat and power (CHP). Cogeneration is the production and use of electricity and heat simultaneously from a given power source. The sources for CHP typically are: heat from waste incineration, waste from power production, industrial waste and biofuel boilers. Solar and geothermal energy are sources of renewable energy that are also used. The market has further developed through the conversion of natural gas into the district heating supply to customers.

For any modern city with a dense population, this type of system offers the most significant contribution to ensuring energy efficiency that's readily available. District heating is used in many cities (especially in Europe), but needs to be used more in major cities throughout the world.

Geothermal District Heating in Iceland

Situated directly on the Mid-Atlantic Ridge, Iceland is one of the most geothermally active locations in the world. The country experiences moderate summers and often bone-chilling winters. An environmentally friendly solution, that takes advantage of the country's geographic position, while meeting the unique needs of the residents and businesses dealing with the often chilly climate, is sensible.

The use of geothermal district heating in Iceland began nearly 100 years ago. Over the past 84 years, the country and its citizens have worked diligently to perfect the system. The people and government have transformed Iceland into one of the global leaders of this. The capital of Iceland, Reykjavik, kicked things off in 1930 with a small elementary school and an infant version of the technology.

Today, the city provides heat to 95% of the over 120,000 population with geothermal district heating. The remaining 5% is supplied by some traditional methods, as well as geothermal power, affording residential and business owners the option of electric heating and space heating.

Outside of Reykjavik, the use of geothermal district heating in Iceland is widespread. Almost 90% of the heating and hot water in the country is provided via geothermal heating, while petroleum, coal and other sources make up the remaining percentage; however Iceland also uses geothermal power as over 50% of its energy source, some of which goes towards electric heating systems.