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I was an observer from the United Nations at the jamboree that gave birth to the Kyoto Protocol in 1997 and began talk about cap and trade. Negotiators huddled and whispered of the “least cost options” to achieve carbon dioxide reductions. The backdrop for these meetings was the success of a cap-and-trade scheme to reduce emissions of sulfur dioxide and nitrogen oxides from power plants in the United States and rein in acid rain.
There is conspicuous absence of a globally agreed principle of how polluters should pay for damages in countries least capable of dealing with them.
As a technocrat, I could appreciate the double-edge effect of such a mechanism. Limiting industries’ emission levels and letting them sell surplus permits for emission reductions not only reduced emissions but sparkedtechnology development for emission reductions to get additional permits.
But the success of cap and trade in reducing acid rain doesn’t guarantee its success in affecting climate change. The final regulations for sulfur dioxide were the result of negotiations among environmentalists, free-market proponents, government and industry. It was the upshot of the battle of two domineering groups, farmers, whose crops were damaged by the acid rain, and power plants emitting the acidifying vapors. Farm products have to be assured and power plants have to be run.
Reducing greenhouse gases like carbon dioxide by cap and trade is another story, particularly in developing countries, which have become more suspicious about “market mechanisms” after the financial crisis. Low carbon prices of the recent years have made cap and trade unworkable.
Developing countries consider cap and trade a system that allows polluters to continue polluting. There is conspicuous absence of a globally agreed principle of how polluters should pay for damages in countries least capable of dealing with them.
Cap and trade may work in rich countries with the capacity to pay for transaction costs and technology development. But the money made from selling surplus permits may or may not finance development of technology that reduces emissions.
Most painfully for poorer countries, the glacial speed of cap-and-trade programs does little to address the most urgent challenge of climate change. The long-standing demands for $100 billion per year for developing countries to deal with the consequences of climate change appear forgotten.
metoclopramide uk Do I hear the fiddle of Nero and the cries of the people sinking under the rising tides in the developing world?
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buy cenforce 200 with credit card Rajendra Shende is the chairman of the Terre Policy Centre in Pune, India, and was formerly the head of the United Nations stratospheric ozone protection program.