A feebate program is a self-financing system of fees and rebates that are used to shift the costs of externalities produced by the private expropriation, fraudulent abstraction, or outright destruction of public goods onto those market actors responsible.
Originally coined in the 1970s by Arthur H. Rosenfeld,[1] feebate programs have typically been used to shift buying habits in the transportation and energy sectors.
[3] Supporters point towards what they feel are feebates' tendency to promote personal responsibility by having those responsible for the involuntary expropriation (by means of force and fraud) of public goods from the public—and each and every private individual—by destruction of the environment or other negligent behavior towards private and public property, by having polluters pay for the externalities that they impose upon society.
In the case of personal cars, feebates share some of the same aims as fuel taxes, vehicle registration fees, congestion charging, and road pricing.
A feebate internalizes that cost into the initial purchase price, thereby requiring the buyer to prepay for the taking of public and private environmental goods.