Will Carbon Trading Save the Planet?

There has been tremendous debate over the merits of the carbon trading scheme. Recently, the World Bank has conducted a study over the merits of such a plan. Their findings are a resounding NO. The carbon credit plan has actually made it cheaper to run coal-fired plants. Polluters, in fact, are able to continue polluting sometimes at even greater capacity. The argument from proponents of the plan is that the overall pollution is reduced through reward schemes for those companies that don’t pollute.

While the plan does reward those who are more environmentally conscious, it does not truly change the attitude toward conservation as a flat tax or penalty would.

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Will Carbon Trading Save the Planet?
www.wallstreetandtech.com
by Penny Crosman

Although carbon credit trading is poised to take off, does it really accomplish what it’s designed to do — that is, help the climate? If World Bank statistics are accurate, the answer is, “No.”

In late May the World Bank reported that the global market for carbon emissions trading doubled in value last year, to $126 billion. But while 4.8 billion tons of carbon dioxide were traded, the actual realized emissions cuts fell as the global recession slowed clean energy financing. One critic of carbon credit trading, David Victor, professor at the University of California in San Diego, opines that carbon credit prices have been so low that it’s cheaper to run coal-fired plants and pay for credits than to retrofit a plant to use lower-carbon natural gas.

Rolling Stone reporter Matt Taibbi has called carbon credit trading the next bubble. “Cap and trade will allow a small tribe of greedy-as-hell Wall Street swine to turn yet another commodities market into a private tax-collection scheme,” he wrote in his recent incendiary article about Goldman Sachs, “The Great American Bubble Machine.”

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