Carbon Offset Schemes Require the Poorest to be Twice Burdened

[Orwellian_Ghost]

The Injustice of Carbon Offsets
Offset Schemes Require the Poorest to be Twice Burdened

September 21, 2009 By Vandana Shiva


The science of climate change is now clear, but the politics is very muddy. Historically, the major polluters were the rich, industrialised countries, so it made sense that they should pay the highest price. The Kyoto Protocol, adopted in December 1997, set binding targets for these countries to reduce their greenhouse-gas emissions by 5 per cent on average against 1990 levels by 2012. But by 2007, America's greenhouse-gas levels were 16 per cent higher than 1990 levels. The American Clean Energy and Security Act, which was passed in June, commits the US to reduce emissions to 17 per cent below 2005 levels by 2020, yet this is just 4 per cent below 1990 levels.

The Kyoto Protocol also allows industrialised countries to trade their allocation of carbon emissions, and to invest in carbon mitigation projects in developing countries in exchange for Certified Emission Reduction Units, which they can use to meet reduction targets. But emissions trading, or offsetting, is not in fact a mechanism to reduce emissions. As the Breakthrough Institute, an environmental think tank, has pointed out, the emissions offset in the American act would allow "business as usual" growth in US emissions until 2030, "leading one to wonder: where's the 'cap' in 'cap and trade'?".

Such schemes are more about privatising the atmosphere than about preventing climate change; the emissions rights established by the Kyoto Protocol are several times higher than the levels needed to prevent a 2°C rise in global temperatures. Allocations for the UK, for example, added up to 736 million tonnes of carbon dioxide over three years, meaning no reduction commitments. And emissions rights generate super profits for polluters.

The Emissions Trading Scheme granted allowances of 10 per cent more than 2005 emission levels. This translated to 150 million tonnes of surplus carbon credits, which at 2005 prices translates into profits of more than $1bn.

Carbon trading uses the resources of poorer people and poorer regions as "offsets" for richer countries: it is between 50 and 200 times cheaper to plant trees in poor countries to absorb CO2 than it is to reduce emissions at source. In other words, the burden of "clean-up" falls on the poor. From a market perspective, this might appear efficient, but in terms of energy justice, it is perverse to burden the poor twice - first with the impact of CO2 pollution in the form of climate disasters and then with offsetting the pollution of the rich.

...

http://www.zmag.org/znet/viewArticle/22655

[HamdenRice]

1. WTF? Did the author even look at his/her own data?

The system basically requires rich countries to pay poor countries, and that's a burden on the poor?

[The Straight Story]

2. Problem with that is - rich America, where 1% own most the wealth, the poor here will pay

Instead of burden on countries it should be on corporations, no matter which country they are in.

[Statistical]

3. Exactly.

Say a plant in US needs to cut emissions by 500 tons of CO2 and that would cost hypothetically $200,000. They could also buy CO2 credits on the exchange for $180,000. They could also PAY a 3rd world country $100,000 to plant enough trees to offset that 500 tons.

So the company PAYS people in 3rd world for the land & labor to plant and maintain x number of acres to reduce global CO2 levels.

To the OP: how does the poor country "suffer" when it receives and infusion of capital and local jobs?

[Orwellian_Ghost]

5. To the respondent

Tell me what you know about carbon trading and how it is implemented.

[HamdenRice]

7. Why don't you go first.

And no using sources like WSWS, which we all now know is bogus.

[Statistical]

8. Well it hasn't been implemented yet so the devil is in the details.

General concept.

Year one companies receive credits for their current pollution. Say the sum of all credits for year 1 is 50,000,000 metric tons of CO2.
Each year number of credits is reduced to reach the target goal in 2030.

So each year every company faces a situation where their allocation of credits is reduced by x%.

The company can do one of three things
1) Reduce their CO2 output
2) Purchase CO2 credits from someone else *
3) Do something to offset the CO2 output (like plant trees)

Now lots of people look at #2 and say "hey wait if they can buy credits then they can pollute unlimited". Well that is stupid.

The TOTAL number of credits reduces every year, so no matter how much an individual company pollutes the sum of all the companies is reduced.


Will some companies profit? Hell yeah. Take a power company. Say they have 5 coal power plants that produce 20,000 tons of CO2 per year. They receive 20,000 credits. They shut down the plants and build a single nuclear power plant. Now they have 20,000 credit they can sell on the exchange. Next year the credits are reduced to say 19,200 and they sell those, next year 19,000, etc.

By requiring every company to have a credit for every ton of CO2 produced it doesn't matter if an individual company raises or lowers their emissions. The net sum is a reduction in CO2.

[HamdenRice]

9. It also ensures that the company most efficiently able to reduce carbon does so

It's basically very similar to the system that was used successfully for water pollution and air pollution.

The system comes into being with pollution already occurring, and with an existing set of polluters.

First set a target. For water, it's usually how much pollution can this body of water tolerate for the use we want -- say, recreational. Identify every polluter. (That's the "cap" in "cap and trade".) Divide the target pollution among existing polluters pro rata according to their current emissions. Issue a "permit" for the amount they will be allowed, which is usually immediately less than they were polluting.

If the permits are tradeable, and one polluter is able to reduce pollution even more than his permit target he will do so and sell the excess reductions to someone having more trouble doing so, who would have to buy it simply to continue operating. The permit targets also decline constantly forcing polluters/emitters to constantly seek new ways to reduce pollution/emissions.

The reason this is superior to ordinary permit reductions, is with straight permit reductions if someone can reduce pollution even more than they are required, they have no incentive to do so, because reducing pollution (or carbon) has a cost. The system of transferable pollution or carbon credits means everyone has a strong incentive to reduce pollution even more than their overall share of the target -- as in your power plant example.

[Orwellian_Ghost]

4. How much research

have you done on carbon trading? Do you know how it works?

[HamdenRice]

6. A lot. Yes.

And you? Because you seem to have strong opinions on many things about which you often end up having faulty knowledge.

[Orwellian_Ghost]

10. Here ya' go

How many times can you be utterly ignorant of the facts. I have to say it's astounding how consistent you are. And please no propaganda outlets allowed for your sourcing such as Wiki or the NY Times.



http://www.carbontradewatch.org/

Carbon Trading : a brief introduction

Written by Oscar Reyes
Monday, 07 September 2009

Carbon trading is allowing industrialised countries and companies to avoid their emissions reduction targets. It takes two main forms: “cap and trade” and “carbon offsetting.”

What is cap and trade?

Under cap and trade schemes, governments or intergovernmenal bodies set an overall legal limit of carbon emissions in a certain time period (“a cap”) and then grant industries a certain number of licenses to pollute (“carbon permits”). Companies that do not meet their cap can buy permits from others that have a surplus – typically, because they have been given an overly generous allowance in the first place. They can also purchase “offsets.”

What are carbon offsets?

Carbon trading runs in parallel with a system of carbon offsets. Instead of cutting emissions themselves, companies, and sometimes international financial institutions, governments and individuals, finance “emissions-saving projects” outside the capped area to generate carbon credits which can also be traded within the carbon market. The UN's Clean Development Mechanism (CDM) is the largest such scheme with almost 1,800 registered projects in developing countries by September 2009, and over 2,600 further projects awaiting approval. Based on current prices, the credits generated by approved schemes will cost around $35 billion by 2012.

Although offsets are often presented as emissions reductions, what these projects do at their hypothetical best is to stabilise emission levels while moving them from one location to another, normally from Northern to Southern countries. In practice, this “best case” scenario is rarely seen, with the result being that offsetting increases emissions whilst also exacerbating social and environmental conflicts.

So what's wrong with cap and trade?

There are fundamental theoretical flaws in the whole cap and trade scheme even before you look at the actual record of its implementation. This is because the scheme was never set up to directly tackle the key task of a rapid transition away from fossil fuel extraction, over-production and over-consumption, but sought instead to quantifying existing pollution as a means to create a new tradable commodity. Within this framework, traders invariably opt for the cheapest credits available at the time, but what is cheap in the short-term is not the same as what is environmentally effective or socially just.

Some of the key problems with the cap and trade approach are:


...

http://www.carbontradewatch.org/index.php?option=com_content&task=view&id=306&Itemid=36

As one who defends the predatory institutions of global finance I'm sure you are wholly on board with further exploitation of the poorest. But please use pretty words to rationalize this latest scheme.

[HamdenRice]

11. And you continue to support the slaughter of baby arctic seals for the fur!

OK we're back to square one with your rhetorical technique. How sad.

Why don't you try to address the explanation upthread with your own understanding/critique, rather than the usual mix of cut and paste and ad hom?

[Orwellian_Ghost]

12. Gotcha'

In short you can't read anything that disputes your narrow prism. Challenging your false assumptions is tough Hammy. The dissonance would probably cripple your capacity to function. What about Reye's points did you find so disagreeable? Anyone who can't see what a scam carbon offsets are simply don't want to examine the truth.

You actually think policies set by the wealthiest nations are put there to help the poorest?

:rofl:

Sad.

The “trade” component does not reduce any emissions. It simply allows companies to choose between cutting their own emissions or buying cheaper “carbon credits,” which are supposed to represent reductions elsewhere

[HamdenRice]

13. Here's the perfectly incoherent takeaway from your post-->

'The “trade” component does not reduce any emissions. It simply allows companies to choose between cutting their own emissions or buying cheaper “carbon credits,” which are supposed to represent reductions elsewhere'

So it doesn't reduce "any emissions" although companies must choose between reducing their own emissions or paying someone else to reduce emissions elsewhere.

How does that not reduce "any emissions"?

[Statistical]

14. Exactly.

You seem to forget one important point.

For a company to not reduce they need to buy a CREDIT
Where does the credit come from.... another company who has reduced their emissions BELOW the target.

Since the number of credits each year is fixed (and shrinking) it is an impossibility for the amount of pollution to not decrease.

Some companies will pollute more than their limit (at higher cost).
Some companies will pollute at exactly the same as their limit each year.
Some companies will pollute less than their limit each year (at reduced cost).

Under a fixed cap:
Company 1 produces 200 tons
Company 2 produces 200 tons
Company 3 produces 200 tons

Under a cap and trade with 600 tons
Company 1 produces 300 tons (by buying 100 extra credits)
Company 2 produces 200 tons
Company 3 produces 100 tons (and sells 100 credits)

Either way this 3 company country produces the same amount of CO2.

Nest yeat the number of credits is reduced by x% so company 2 will either need to reduce emissions or compete with company 1 for the credits company 3 is selling.

[blindpig]

15. In a nutshell:

It is a scam devised to maintain profits. It is too little too late. They are fiddling while Rome burns.

There is a desperate need for a planned economy.

k&r