Fixing Rising Price Paths for Fossil Energy: Basis of a “Green Growth” without Rebound Effects

The transformation towards a zero-carbon economy requires a comprehensive renovation of the capital stock. This chapter proposes a system of effective carbon pricing that avoids the rebound effects of the related (transitory) “green growth” on carbon emissions. Technically, a system of effective carbon pricing could easily be implemented: a group of countries like the EU, or the biggest carbon emitters as “China-US-EU climate club” or a “Mercosur climate club” sets a path of steadily rising prices of crude oil, coal, and natural gas by skimming off the difference between the target price and the respective world market price through a flexible quantity tax.