As you may recall from Part 1 of this article, in the cap-and-trade system many companies might get away with carbon emissions that are below the “certified limits”. And that's a crucial point since cap-and-trade policy might bog down in implementation nightmares. Who is going to determine the “caps” on an industry by industry, and company by company basis? Wouldn't that require a new immense federal bureaucracy of its own?
However the momentum right now seems to be still with the cap-and-trade idea. As of this writing in April 2007, five different cap-and-trade measures are currently being evaluated in the U.S. Senate.
However, if the United States ends up adopting a carbon tax approach, it will by default withdraw itself from the increasingly lively cap-and-trade market in Europe and other parts of the world. India, to wit, is fast credentialing many of its utility companies with the U.N. to earn carbon credits to trade in EU. China will not be too far behind India in creating a new cash cow out of the “carbon cap credentialing” business.
If the U.S. also joins the cap-and-trade bandwagon in earnest, many experts agree that the New York City might easily become the leading carbon credit trading capital of the world. Until then, New York must suffice by watching the amazing growth of the London carbon credit exchange.
However, regardless of which policy approach is finally adopted, neither yet clearly answers how the “proceedings” will end up being used to slow down and eventually reverse the global warming. I'm afraid the task is too monumental to be achieved by just merely “planting more trees” with the revenues accrued through one or the other approach.
Both of these proposals represent the “fund raising” phase of the global campaign to stop global warming. But once the funds are there, how will they be spent to have a real impact on global warming? That question is still not answered.
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Ugur Akinci, Ph.D. is a senior writer and web content consultant with 20 years of experience.
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