Is Cap-and-Trade Affective?

Cap-and-trade systems seem like they would be an effective method for reducing emissions affecting global warming. Some members of the United States Congress have tried to introduce the system for implementation to no avail. As I touched on in my analysis post, President Obama plans to implement a cap-and-trade program. In a cap-and-trade program, the government of a country first sets a cap on emissions. Next, credits, or permits, are given to different companies depending on the company’s size, what they do/produce, etc. Lastly, companies that need more credits can buy them from other companies that don’t need all of theirs. Sounds good, right? While supporters of the program are adamant that it would be very effective, some top claims of opposers of the system say that the system will raise energy costs and cause job loss because producers will have to have more money to buy more credits. Another argument is that it won’t really help the environment. The opposition uses information collected from the European Union’s cap-and-trade system. The Wall Street Journal reports that, “utilities companies made windfall profits by simply selling on large numbers of unneeded credits and not passing the savings on to their customers in the form of price cuts.” This is an example of potential raised prices. Figures show that in the first three years of the European Union’s system, emission rose 1.9 percent. Some kind of method needs to be found to lessen emissions of companies all over the world. Cap-and-trade seems to be the preferred option right now, so let’s President Obama’s plan won’t produce negative effects similar to that of the European Union.

Green Tip Hesabu Saba (Number Seven): Short and sweet this post, say no to ATM receipts! "Americans take so many each year that the roll of paper could circle the equator 15 times."