| Sourced From |
Cap and trade. If you havent educated yourself yet, its time. Fortunately, the capping of carbon emissions in the United States may well be upon us. Understanding how emissions caps work is in everyones interest as the environmental, social and economic consequences of a carbon cap will be significant.
The American Clean Energy and Security Act of 2009 (ACES) was recently released by its authors, House Energy and Commerce Committee Chairman Henry Waxman, D-Calif., and the dean of the Massachusetts delegation: Energy and Environment Subcommittee Chairman Edward Markey, D-Mass. Hearings and debate are under way; a House vote is anticipated before the summer recess. The act charts a remarkably comprehensive course to a clean energy economy.
A key part of the legislation places limits on greenhouse-gas pollution by use of a system that caps carbon emissions to specific levels and allows emitters to find the least expensive means of meeting those limits by trading their allowances.
The concept is similar to the program started in the 1990s to curb acid rain. The goal then was to cap national sulfur dioxide emissions at 50 percent of 1980 levels. Each year, EPA issues allowances within that cap to power plants covered by the acid rain program. Each allowance is worth one ton of sulfur dioxide released from the smokestack. Additional allowances are withheld and auctioned to help ensure that new power plants have a source of allowances beyond those allocated initially to existing plants. Plants are allowed to release as much sulfur dioxide as they have allowances. If a plant expects to release more than that, it has to secure more allowances, such as by buying them from another power plant that has reduced its sulfur dioxide emissions below its allowances and therefore has allowances to sell or trade. Allowances are also bought and sold by
Related posts: