New Plans Try to Revive Carbon Trading
By JAMES KANTER, NY Times, May 24, 2010 [here]
BRUSSELS — Carbon trading was meant to reduce greenhouse gas emissions in the European Union by making polluting more expensive for heavy industries, encouraging them to invest in cleaner technology. But even supporters admit that the system, also known as cap and trade, is falling far short of that goal. Critics decry it as just another form of financial profiteering with little environmental benefit.
Carbon traders, for example, have been arrested for tax fraud; evidence has emerged of lucrative projects that may do nothing to curb climate change; and steel and cement companies have booked huge profits selling surplus permits they received for free. …
Under carbon trading, governments place a “cap” on emissions from certain industries, issue a set amount of permits to companies and require them to purchase more if they exceed their limit. Companies that pollute less can “trade,” or sell their surplus permits.
The permits are traded on several exchanges throughout Europe, which dominates a global industry worth about $140 billion a year. …
The global recession also has idled factories, leaving heavy polluters like the steel company ArcelorMittal and Lafarge, a cement maker, with a huge excess of carbon permits. Some have sold their permits for millions of euros.
In the United States, the cap-and-trade idea still is supported by the administration of President Barack Obama… [more]