Smokestacks billow clouds of smoke at a heat-engine plant in Poznan, central Poland, where world leaders are gathering for UN climate talks, which run through December 12. (Xinhua / NEWSCOM)
UN defends carbon-trading scheme from US criticism
By Eoin O'Carroll | 12.05.08
The UN’s top climate official defended a global trading scheme to reduce greenhouse gas emissions after the US government released a report questioning its efficacy.
The General Accounting Office, the investigative arm of Congress, published a report Tuesday analyzing the UN’s Clean Development Mechanisms, arrangements under the Kyoto Protocol that allow rich countries to meet their commitments to cut greenhouse gases by investing in projects – such as a wind farm or a reforestation program – that reduce emissions in poorer countries.
The GAO found that the cap-and-trade scheme successfully created a working carbon market, “but its effects on emissions, the European economy, and technology investment are less certain.” The report noted that the use of carbon offsets can “undermine the system’s integrity” because there is no way to ensure that the projects invested in would not have been built anyway, or that they will last long enough to reduce the amount of emissions that they are expected to reduce. Carbon offsets, the report concluded “involve fundamental tradeoffs and may not be a reliable long-term approach to climate change mitigation.”
Yvo de Boer, executive secretary of the UN Framework Convention on Climate Change, said that, while the program can certainly be improved, the fundamentals of the system were sound. Mr. de Boer, who is attending the UN climate summit in Poznań, Poland,
“It’s not as though we’re printing money in the garage,” de Boer told Reuters, adding that there are mechanisms in place to verify the emissions cuts. “There is room for improvement and there are projects that perhaps make it through that shouldn’t have…we are in a learning experience.”
A complex system
The GAO is not alone in saying that cap-and-trade systems are an invitation to abuse. The Times, a British daily, ran a story this week describing the system as “the greatest and most complex commodity trading market the world has ever seen.” It quotes leading US climate scientist James Hansen, who calls the approach “terrible”:
“Carbon trading does not solve the emission problem at all,” he says. “In fact it gives industries a way to avoid reducing their emissions. The rules are too complex and it creates an entirely new class of lobbyists and fat cats.”
The Times’s Jonathan Leake offers a pungent example of how this can happen:
Daniel Co, a Filipino pig farmer, used to shovel the dung from his 10,000 animals into ponds on his Uni-Rich Agro Industrial farm. The manure generated thousands of tons of methane, a global warming gas, but Co did not want to spend £110,000 on kit to trap the gas.
Then EcoSecurities, a British carbon trading firm, worked out that anything that captured the methane would entitle the farmer annually to nearly 3,000 “certified emission reductions” – the nearest thing to a carbon trading currency.
EcoSecurities did the paperwork for Co and gave him just over £2 per certificate. He put in the methane-capture kit, generating power and saving about £24,000 a year in utility bills. EcoSecurities sells the CERs for about £10 each to a French bank, which sells them on to power plants that need to offset emissions. The consumer pays through higher bills. A nice little earner for everyone except the poor mugs (us) at the end of the chain – but can it save the planet?
Mr. Leake notes that Britains carbon trading sector already employs about 3,000 people and has created “few dozen new millionaires.”
An alternative?
Instead of of a cap-and-trade system, Mr. Hansen endorses a straightforward carbon tax. In a letter to president-elect Barack Obama [PDF] last month, the NASA climatologist proposed taxing fossil fuels at the mine, derrick, or port of entry, and turning all of the revenues over to the public:
The entire tax should be returned to the public, equal shares on a per capita basis (half shares for children up to a maximum of two child-shares per family), deposited monthly in bank accounts. No bureaucracy is needed.
A tax should be called a tax. The public can understand this and will accept a tax if it is clearly explained and if 100 percent of the money is returned to the public. Not one dime should go to Washington for politicians to pick winners. No lobbyists need be employed.
The public will take steps to reduce their emissions because they will continually be reminded of the matter by the monthly dividend and by rising fossil fuel costs. It must be clearly explained to the public that the tax rate will continue to increase in the future.
A carbon tax has attracted other endorsements. The consumer advocate and electoral gadfly Ralph Nader and the Canadian journailst Toby Heaps called for a global carbon tax in an op-ed in Wednesday’s Wall Street Journal. And in a speech this July, Al Gore said that he has long supported a sharp reduction in payroll taxes with the difference made up for in carbon taxes. “We should tax what we burn,” he said, “not what we earn.”
Despite these endorsements a carbon tax seems unlikely in today’s political climate. Mr. Obama has long endorsed cap-and-trade as a way of achieving an 80 percent reduction in US greenhouse emissions by 2050, and he has shown no signs of changing his mind.
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2. Victor Nunnally | 12.06.08
Maybe it is time to put cigarette companies out of business and end this evil for good because you can not impose a carbon reduced world, caused by past invention, upon a civilized society and allow them to continue. The Movies will just have to find another funding source, maybe Clean Energy Companies.
3. BART SIMPSON | 12.06.08
Cap-and-trade or “pollueur-payeur” are not an option.
Scientists, the best of them, should come up with revolutionary ideas.
Hope for the best …
4. Da Truth | 12.09.08
First off – I believe Global Warming is a very serious “Very Real- Man Induced” problem.
However, I do not believe the US is to blame. All we did was develop technologies that the rest of the world would have, if they could have. We were, and are, simply more technologically advanced[ [and the world is very jealous of this, and therefore all the criticism, not to mention that we are the worlds only Superpower, and the world is also jealous of that. Kyoto is as much an attempt to undermine our economy as an attempt to solve Global Warming. Much of the world is just using it as an Economic Tool against us – and many people in the US see this for exactly what it is, Hypocrisy,….. and much of the world knows we know. Probably the main reason even Clinton and Gore would not truly support Kyoto]].
Having a degree in Natural Resources I think the evidence (about global warming) is very Clear and Convincing ‘today’. However, I was not really sure until about 1995, even though I started seeing strong evidence around about 1985. At that point a noticeable warm up started (at least where I was living, & others said they noticed it also, in my area & elsewhere). In my opinion the evidence gradually got stronger till 95, when I thought the evidence was rather strong (and has only gotten stronger, today it is downright scary – the Arctic Ice Cap Meltdown - not funny). So I really don’t think you can blame us till then (95), and many in the US and some other countries still don’t want to see it (not just in the US). However, since 95 the US has made many moves (on many fronts) to combat the problem, and many other countries are dragging their feet, or have been given a free pass (the main Kyoto problem). One of the biggest examples here is China…..but there are others.
The world say it is our Industry that caused the problem (they don’t talk about Britain, and other Industrialized nations as much), but it is also probably mostly ‘Our Technology’ that is going to solve it……………….[I could also throw in many examples of other countries stealing our technology on the international market (weak international patent protections, and many anti-US countries want it that way), the vast majority of SE Asian Industries are built on Appropriated US Technology……. Etc., Etc…………………….…
Our technology and Industry also saved the world in WWI, WWII, and the Cold War (not to mention other situations). If we had not spent all those years developing Industries, and Aircraft, & Jeeps, & Tanks, & Ships [[prior to Pearl Harbor the only modern Fighter Plane in SE Asia, other than a Japanese model, was the P-40 Curtis Hawk (Flying Tigers), not a great plane but it kept China from falling]]. We had to use Trains & Trucks to move parts from factory to factory. It took factories to build trains & trucks also, and they had to burn fuel (all this putting carbon in the atmosphere, etc). All those planes, & jeeps, & tanks, & ships etc also burned fuel etc., etc., etc.
Our Industry saved the world on several occasions (also we have established MANY Democracies around the world,….. how many has Russia or China established !!!). So when people talk about this situation as if we are the only beneficiaries (of such Industrialization), they should look at history again, more objectively. If not for us, much of the world could today be under Japanese Imperialism, or Nazism, or USSR domination………’Comprende’.
The rest of the world has ‘As Much a Responsibility’ to solve this problem as we do,
So, THEY SHOULD STOP BALKING, and cut the EXCUSES.
5. Pete | 12.09.08
The cap and trade system sounds flawed but the example here was itself flawed. Sure the price goes up for dirty power generation and the dirty power generation continues. But that in itself is the motivation for people to move to other cleaner (hence cheaper) alternatives. In addition to that the farmer who was producing “thousands of tons of methane” (methane being far more damaging that carbon) is now clean and green. This would have been left the way it was had we taxed carbon and forgotten about the other greenhouse gases.
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1. Olivia | 12.06.08
Based on this article, I support the idea of implementing a carbon tax (on what we burn) and reducing the taxes on wages (what we earn). I trust President-elect Obama is smart, sensible and flexible enough to change his mind and to stop endorsing the cap-and-trade plan, which never DID make sense to me.