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Non-Tech : Climate Change, Global Warming, Weather Derivatives, Investi
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To: golfer72 who wrote (403)12/10/2013 7:48:17 PM
From: Glenn Petersen   of 442
 
The big companies will just pass on the cost to their customers. They would prefer a dealing with a straight carbon tax, which is more predictable and less volatile and susceptible to manipulation than a cap-and-trade scheme.

Because the Supreme Court has previously given the EPA the authority to regulate carbon emissions, the EPA can arbitrarily initiate either a cap-and-trade scheme or a carbon tax without Congressional approval. On the plus side, any regulatory move on the part of the EPA would probably be tied up in court until there is a change in administration.

Carbon Market Mess EU Votes to Rescue Its Dying Carbon Market

Analysis by Walter Russell Mead & Staff
Published on December 10, 2013 5:30 pm

The European Parliament just voted to fix its mess of a carbon market. The Emissions Trading System, or ETS, was launched in 2005 to curb the bloc’s emissions. Not wanting to hamstring its industries, the EU made sure the price for emitting would start out low by overallocating the supply of carbon permits at the outset. Now, eight years later, the price of carbon is a scant €4.90, a far cry from its €30 high back in 2008. Firms have little incentive to adjust behaviors with a price that low, which has prompted Brussels’ best and brightest to move forward with a plan to “backload” further allocations of permits—temporarily curtailing the supply of new permits by roughly one third—to help drive the price back up. The NYT reports:
Current trading prices are not considered sufficient to give companies much incentive to invest in clean technologies or reduce their use of coal, which emits more carbon dioxide than other fossil fuels like natural gas. “Below €20 has no impact on investment decisions,” said Roland Vetter, an analyst at CF Partners, a commodities trading house in London.
This vote was the culmination of a months-long process, and Europe’s greens are hopeful that it will resuscitate a plan that has largely been a failure to this point.

But a higher price of carbon isn’t necessarily in the continent’s best interest. European businesses are already struggling to compete internationally, saddled with the yoke of high electricity prices (a result of green energy subsidies run amok). To slap these industries with more costs—costs that aren’t borne by firms outside of Europe—will make the grass appear that much greener abroad.

the-american-interest.com
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