A proposed analytical procedure for a charge on CO2 emissions is used to determine its impact on the design process of different conventional energy systems. The charge on CO2 emissions is defined as a Carbon Exergy Tax (M). The CET utilises the concept of Efficiency Penalty of the energy system coupled with the Index Of CO2 Emissions, which connects the amount of the CO2 emitted by the plant with the Second Law efficiency of the plant itself. The aim is to reward the efficient use of energy resources, both from a resource and environmental standpoint, and to penalise plants inefficient in this respect. The CET and the conventional Carbon Tax (CT, based on energy policy considerations and imposed on the mass of emitted CO2) are applied to different conventional energy systems (a gas turbine simple cycle; a regenerative cogeneration gas turbine; a three pressure levels combined cycle) in order to determine their impact on the design of the plants. The effects of the CET and CT are investigated for different scenarios (pressure ratio, fuel cost, etc.). The results are presented using useful representations: the cost of electricity vs. efficiency, the cost of electricity vs. specific work, and the cost of electricity vs. plant design parameters (e.g., pressure ratio). Finally, ways that the use of the CET can contribute to the widespread utilization of advanced energy systems, which are more efficient and less polluting, is discussed. In particular, the CET and CT influence is presented and discussed for a solid oxide fuel cell (SOFC) and gas turbine combined cycle. (C) 2003 Elsevier Science Ltd. All rights reserved.