Local governments are looking for powerful tools to create momentum for addressing climate change: What if our taxes and fees were calculated according to greenhouse gas emissions?

Nearly a thousand mayors have signed the U.S. Conference of Mayors' Climate Protection Agreement, sprinting past a virtually toothless federal climate change commitment and creating momentum for real grassroots action toward sustainability.

Transformational change is happening at the local level, and with the infusion of ARRA funds and the associated requirement to create municipal Energy Efficiency and Conservation Strategies, we may actually make some headway in reducing greenhouse gas emissions in the U.S.

Alas, some local governments are limiting these strategies to a narrow field of concern, such as LED traffic lights, random building audits, electric building inspection vehicles -- or worse yet, recycling older energy efficiency plans. While we're all for recycling, now is the time for innovation. Cities are in a unique position to take advantage of the new energy economy and determine their own fate. This is a tremendous opportunity to rethink the status quo regarding municipal policy and large-scale efficiency.

Even though a low carbon-based economy is beginning to emerge from Washington, it may fall to our cities to spur real change. To address this reality, local governments will need new tools and a new vocabulary to catalyze this green economy. Thus, let's consider the concept of calculating property taxes, vehicle taxes, and building permits according to greenhouse gas (GHG) emissions.

By combining energy and water consumption with assessors' records, we can tax waste instead of creativity and drive a market for renewable clean energy and innovation. New construction and building retrofits are frequently required to provide estimated energy consumption modeling, and simple GHG tools are available online, making GHG reporting a box to complete on a permit form. We already measure vehicle emissions, so we have the basis of GHG-based vehicle taxes in place. Match current average tax and fee rates with greenhouse gas levels targeted to meet robust vehicle emissions goals and the 2030 Challenge. Extremely energy intensive consumers will have plenty of motivation to change habits and energy sources.

The economics of this concept provide a financial boon to communities during the transition to a low-carbon community. During this transition, the additional capital can be used for funding sustainability measures such as Property Assessed Clean Energy (PACE) bonds and distributed vehicle-recharging stations. More households will take advantage of the federal weatherization program, hopefully expanded and made available at competitive market rates for those who do not qualify for the standard subsidized program.

Significant trends are already occurring in both the public and private marketplace to support aggressive policy measures. Average home size went down in 2008 for the first time in more than 40 years, consumers are demanding more fuel-efficient cars, and waitlists are forming for plug-in electric hybrid vehicles. While some still think we can continue on a much slower path to reducing GHG emissions, there are increasing pressures for rapid transformation. As the marketplace evolves and energy and water prices rise, we can expect faster development and absorption of efficient products designed by, and for, the new economy. The question is … will it be fast enough to make a difference? Given the success of local efforts to combat climate change, perhaps a municipal carbon economy is not such a radical concept.

Elaine Gallagher Adams is a senior consultant on RMI's Built Environment Team with a wide range of experience in architectural design, historic preservation, energy conservation and green operations, with expertise in passive solar design and rehabilitating existing buildings.

"Boulder in the Distance" - Photo by EventureMan.