Or is it just the recession? An article in the business section of the NY Times this morning notes that there are the first glimmers of evidence that the carbon trading scheme in the EEC is starting to help reduce emissions, even if that improvement is being masked by even larger decreases in emissions caused by the shrinking industrial economy.
As the US Congress starts to consider a number of different cap and trade or carbon tax alternatives (even the House Agriculture Committee is getting into the game) a lot of human hot air (itself laden with CO2) has been unleashed criticizing the Europeans for not properly setting prices, and for giving away too many allowances, etc., etc. But at least they did something, which is more than we here in the US can say about the last eight years.
Mistakes will be made, and then so will adjustments. Personally, I'm confident that markets will eventually stabilize and have the intended effect. Some, Like Emmanuel Fages, who is quoted in the article, and will be at next week's Carbon Tradex America to discuss the European experience, and the plans for Phase 3 of the European Union Emissions Trading System (EU ETS) believe the market already is working. He pegs the decline in emissions -- because of carbon trading, apart from the recession -- at 4.3%. I'll take that, for starters.
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