TOI : Scoring points against pollution : Oct 8, 2007
LEARNING WITH THE TIMES
Scoring points against pollution
What is carbon trading?
Carbon trading is part of the larger emission trading, a method to control
pollution by using economic incentives. In emission trading, a central
authority sets a cap on the amount of pollutants that can be emitted. This
allowance is called a ‘credit’. Where the pollutant emitted is carbon
dioxide, it is called carbon credit. If a company wants to exceed the cap
set for it, it has to buy the extra allowance from those who pollute less.
Such transfers of carbon credits are called carbon trading. In effect, the
party buying the credit is being penalised by having to pay for it while the
seller is being rewarded monetarily for having reduced emissions.
Why do we need carbon trading?
During the combustion of fossil-based fuels, gases such as carbon dioxide,
methane and nitrous oxide are emitted. These create a ‘greenhouse’ effect in
the atmosphere-heat coming from the sun is able to pass through this layer,
but the heat reflected back finds it harder to escape. This results in the
gradual increase in earth’s temperature leading to ‘global warming’. Some
gases also cause thinning of the ozone layer in the atmosphere. Thus more
solar radiation reaches the earth’s surface, accelerating climate change.
The adverse effect of global warming and climate change threatening the
survival of humans has prompted nations to reign in emission of pollutants.
The Kyoto Protocol is an international agreement that assigns mandatory
emission limits for the reduction of greenhouse gases to signatory nations.
Where does emission trading take place?
Different markets have been set up for different emissions in different
parts of the world, such as greenhouse gas trading in the EU or the market
to reduce acid rain in the US. Countries like India and China that are not
required to reduce emission under the present Kyoto protocol are cashing in
on their carbon credits and many industries in these countries are raking in
profits by selling their carbon credits in the international emissions
market that closes by 2012, when the treaty expires.
What are the arguments against the concept of emissions trading?
Critics say pollution trading is dubious science. Instead of policies that
reduce emission, trading is providing elaborate get-out clauses for the
biggest polluters, say the critics. Instead, they advocate making reductions
at the source of pollution and energy policies that are justice-based and
community-driven, policies which they say are not encouraged because they
would adversely affect the “sacred” free market. They point to loopholes and
incentives used by industries to exaggerate their expected emissions to
receive more permits from governments. Also, licences and credits will have
no value without effective enforcement as facilities may find it far less
expensive to corrupt inspectors than to purchase emission licences.
Publication:Times of India Mumbai; Date:Oct 8, 2007; Section:Times Nation;
Page Number:14