The Carbon dioxide emission market

A proposal to reduce greenhouse gases was presented at the United Nations meeting in Kyoto. It is based on setting emissions levels and will begin in 2008. The right to pollute the air then would be bought and sold through a carbon dioxide emissions market. By allotting a fixed amount of emission permits, and providing credits to those who reduce emissions, economists believe companies would have the incentive to decrease burning of coal, oil and natural gas.

The Carbon dioxide market establishes a system by which companies and countries that need to burn the coal, oil and natural gas could broker the deals with one other, or they could work through a brokerage system set up like a typical commodities exchange. At the end of the year, the companies would have to hold enough permits to cover their emissions, or face sanctions from the enforcement body. Companies would also get credits for helping reduce the emission of carbon dioxide around the world. Permits for emissions would then be distributed worldwide and companies would have their emissions monitored. At the end of the year, they would have to produce permits needed to cover their emissions. Emissions can be monitored based on energy consumption at ground level. Also, carbon dioxide emissions can be monitored by satellite tracking systems.

The carbon dioxide emissions market would allow market forces to create a controlled decrease of the carbon dioxide emitted into the atmosphere. It is based on a permit system that has helped industries reduce the amount of sulfur dioxide emissions and a similar market-based approach that has helped phase lead out of gasoline.

If the market works as planned, those countries would get more efficient power plants and, more importantly, improved air quality through investment by more advanced utilities. Economists, environmentalists and diplomats are considering whether to recommend that the United Nations set up an enforcement system, or whether to recommend the establishment of a new organization along the lines of the World Trade Organization.

The average well-fed Western eats each day 3
The average manual worker produces each day 0.5
The average Ethiopian uses each year 280
The average Pakistani uses each year 2800
The average Briton uses each year 47000
The average American uses each year 128000
The average domestic hot water unit uses in the UK each year 2000-5000
The share of the fuel used in a return flight to Europe by a UK couple 2500
The average house in the UK uses in space heating each year 4000-15000
A one-way flight from London to Melbourne consumes, per person 10000
The UK consumes each year 2 570 000 000 000
The UK receives in solar radiation each year 232 500 000 000 000

Table 4: comparison of different energy consumptions (KWh) [11]

Every nation would be encouraged to participate. If only the industrialized nations sign up for the program, a shift of carbon dioxide producing industries to developing nations could occur, taking away jobs from North America, Europe and Japan and doing nothing to reduce global carbon dioxide emissions.

Most of the world’s developing nations, including China and India, oppose the plan, in part because they believe the United States and other industrialized countries, which account for more than two-thirds of the earth’s carbon dioxide emissions, should carry a greater portion of the reduction burden.

But if the developing countries are not compelled to participate, they are likely to develop economies dependent on coal, oil and natural gas as well as draining jobs from industrialized countries. This will simply redistribute existing greenhouse gas pollution levels.