Thought-provoking presentation which reads quickly so no real need to summarize. I think its correct that to the extent there's a shared infrastructure (eg a smartgrid) its probably better just to agree to upgrade the grid rather than come up with an obscure pricing plan. Also, measurement for carbon pricing might be hard. Even if for NatGas there's a lot to optimize in terms of methene leakage how do you measure the methene leakage?
On the other hand, I'm not convinced how smart the central planner is at multi-dimensional tradeoffs. Going back to NatGas. Supposedly we don't want any NatGas in 50 years. But in the shortterm modulo methene emissions NatGas has half the emissions of coal and the UN believes that the cumulative path of carbon emissions matter.
The "smart" central planner response is to ban new pipelines (see keystone) so NatGas producers substitute towards railroads. Politically is just banning Keystone better than making both NatGas and coal more expensive via a tax. And then NatGas producers need to decide that given the higher cost of NatGas is it worth building the pipeline? And then to the extent that the build the pipeline tax monster gets its revenue instead of just a failed political battle? Is it obvious that NO pipelines should be built? Or that pipelines can't be built with say a <forever lifespan?
I guess the crux of the argument is slide 11. If there is significant uncertainty about the cost of abatement isn't that precisely the situation where relying on a carbon price instead of a central planner excels? And if the central planner thinks it costs $1000/ton to abate "industrial electrification" carbon won't we still abate some at a price of $100/ton?
Haven't found any good sources on it but supposedly cap & trade for sulfur emissions ended up costing much less than the predicted cost using the regulation route (https://www.edf.org/approach/markets/acid-rain)