Since the "Cash for Clunkers" program was so successful in stimulating demand for new autos, why not use the same concept to stimulate the demand for new clean power plants to replace our dirty coal plants?
How about a "Cash for Coal" program? The government will pay you for the residual economic value of your coal plant and offer to finance the construction of a new, carbon-free base load power replacement plant of equal or greater capacity provided the cost of the plant is under $2,000 per KW of average capacity (not nameplate capacity). Nuclear power (such as the CANDU reactor) has recently been installed in China for less than this, so the numbers are reasonable. Of course, any clean power technology would qualify so long as the price target is met; I'm just using nuclear here as an example.
We are installing clean power in the world at nearly 100 times slower than we need to avert a climate crisis (350ppm being the new goal which we've already exceeded). Cap and trade isn't going to get us there fast enough. In fact, some influential thinkers, such as James Hansen, will tell you that that Waxman-Markey will actually slow down the rate we install new clean power.
To give you some idea of how far behind we are, consider that in 2008, for technosolar, peak capacity for solar was 13.5 GW and wind was 122 GW. The amount of wave power and hot dry rock geothermal is trivial (small scale demonstration only). Volcanic vent geothermal is 10.5 GW. Based on average capacity factors of 0.15 for solar, 0.25 for wind and 0.75 for geyser-derived geothermal, that represents a total average 'renewable energy' power (excluding biomass) of 40 GW, globally, in 2008.
We need about a GW of new clean power each day for the next 25 years to avert disaster. So in our entire history, we're 40 days into it. Let's say we installed all that power in the last 4 years to be aggressive. So that's 10GW /year or about 36 times slower than we should be.
But a "Cash for Coal" option could get us there at a rate of our choosing. If it doesn't work fast enough, all Congress has to do is raise the incentive price until it does.
What could be simpler?
If we are serious about saving the planet and achieving 350ppm, this may be the most economical way to accelerate the rate of retiring coal plants.
If we cannot virtually eliminate the CO2 emissions from coal plants (either by replacing them or capturing all their CO2 emissions), then it is IMPOSSIBLE to hit 350ppm or even 450ppm no matter what else we do. The planet is lost.
If we develop new technologies to suck massive amounts of CO2 from the air and sequester it and then require all power plant operators to be carbon neutral, that would work too. In the absence of a proven technology to do this economically, at large scale for all coal plants, and without risk of accidental release, the Cash for Coal option may be our cheapest solution since it doesn't generate the CO2 in the first place and ultimately is more cost effective.