December 15, 2007

Carbon credits and debits

Dr. Robert Peltier, PE

 Carbon control legislation made it out of a subcommittee of the U.S. Senate Committee on Environment and Public Works in late October, but no one is happy with it. The bill, S. 2191, America’s Climate Security Act of 2007, would direct the U.S. EPA to establish a program to decrease emissions of greenhouse gases (GHGs). Though it doesn’t stand a chance of moving beyond the Senate floor, it does highlight the most contentious issues facing any attempt to legislatively control CO₂ emissions.

Besides providing financial aid to low- and middle-income taxpayers to help them adapt to new energy-efficiency rules, and funding a program to accelerate the development and deployment of innovative energy technologies, S. 2191 would:

• Require the three sectors that account for 75% of America’s CO₂ emissions (electric utilities, industrial manufacturing, and oil refining) to lower their emissions to 2005 levels by 2012, to 1990 levels (about a 15% reduction) by 2020, and to 65% below 1990 levels by 2050.
• Create a cap-and-trade program for six GHGs, with the caps proportional to the gases’ global warming potential. Some 20% of the tradable emissions allowances would be given to existing carbon generators; the rest would be auctioned. Total credits available would then be ratcheted down over 24 years to meet the emissions-reduction goals.

If Congress is going to choose a cap-and-trade plan as its big gun in the fight against climate change, then it should recognize and acknowledge the “collateral damage” it will cause in terms of economic inequities both domestically and internationally.