Use of market-based mechanisms are favored by economists and welcomed by industry as they reduce the costs of meeting emissions targets. The Kyoto Protocol created three distinct flexibility mechanisms to reduce the economic burden of target compliance—joint implementation, the Clean Development Mechanism, and international emissions trading. The advantages and limitations of these approaches, as well as the employment of a carbon tax, should be considered.
Market-based mechanisms are generally favored by economists and welcomed by industry, as they tend to reduce the costs to industry (or countries) of complying with targets. However, effective trading approaches require an overall cap on emissions. Analysts are discovering that the administrative difficulties of implementation and enforcement of capand-trade systems amongst countries are not trivial. The Financial Times recently exposed the weaknesses in the carbon offsets market with buyers paying either for reduction that do not take place or for reductions that would have taken place anyway. Partly for these reasons, some economists prefer the levying of taxes on activities that lead to the emissions of greenhouse gases.
Carbon taxes are easier to implement than cap-and-trade schemes, economically efficient, but politically difficult to legislate in some democratic regimes. A carbon tax would reduce carbon emissions and increase revenues. Substantial benefits could be gained from carbon taxes in all countries based on the “common but differentiated” principle. In addition to emissions reductions, they would generate resources for the development of clean energy sources as well as for the cost of adaptation in poor developing countries.
The CDM was created to support low-carbon investment in developing countries. It allows both the private sector and governments to invest in projects that reduce emissions (as compared to emissions that would occur in a baseline scenario) in developing countries, and provides one way to support links between different regional emissions trading schemes. However, it has encountered administrative and technical hurdles, and its future is clouded because of the uncertainty about the post-2012 regime. Appendix 3 summarizes other challenges that the CDM faces. Initial CDM projects have been limited to a few countries, and a few gases, and have been plagued by bureaucratic procedures, with little contribution to sustainable development.
Some analysts have suggested that these market-based mechanisms are good at identifying the cheapest mitigation opportunities amongst existing options, and spurring innovations that have immediate cost reductions, but are less helpful in spurring the development of new lowemission technologies.
Questions for GLCA:
-Should GLCA advocate or recommend a carbon tax, cap-and-trade system, or a combination of both?
-Should GLCA propose concrete steps for reforming the CDM?
Enbridge oil pipeline project delayed by spill concerns
Waterdown Daily Times: Citing water-safety concerns, the Canada National Energy Board denied the application for an oil pipeline project proposed by Enbridge Pipelines of Calgary that would carry crude oil across the watersheds of Lake Ontario and St. Lawrence River ? a move praised by Clayton environmental advocacy group Save the River, which opposed to the project. The denial of the application, made Oct. 6 by the energy board, will delay a project that would reverse the direction of oil shipped through a 639-kilometer...
Climate Change on the Nuclear Subcontinent
Huffington Post: In a recent blog post, Secretary of State John Kerry described climate change as a "gathering storm," already affecting millions around the world and posing direct challenges to our national security and global stability. In a new report, the Pentagon agreed. Indeed, our climate is changing in erratic but decisive ways, as the ice caps melt, seas warm (and rise), and the temperature of the globe increases over time. Diverse disciplines offer perspectives on these issues that could lead to our deeper...
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Agence France-Presse: Fresh UN climate talks opened in Bonn on Monday with a plea for nations to overcome rifts as scientists reported record global temperatures for the month of September.
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National Public Radio: Host Audie Cornish talks with Drew Gronewold, a hydrologist at the National Oceanic and Atmospheric Administration, about why water levels in lakes Superior, Michigan and Huron are rising.
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Independent: Dredging is ?pointless? and largely ineffective, according to a coalition of environmental groups who are calling on the Government to scale down its preferred method of flood prevention.
The Blueprint for Water coalition, which represents groups such as the RSPB, the Angling Trust and Friends of the Earth, is urging the Government to spend money earmarked for dredging on ?more effective? alternative flood-control methods such as improved drainage systems.
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Regulations Could Douse North Dakota Gas Flares
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Cheap African solar energy could power UK homes in 2018
BBC: Investors are seeking funding from the UK government for an ambitious plan to import solar energy generated in North Africa.
Under the scheme, up to 2.5 million UK homes could be powered by Tunisian sunshine by 2018.
The company involved says they have already spent 10 million euros developing the site.
A number of overseas energy producers are competing to bring green energy to the UK from 2017.
The TuNur project aims to bring two gigawatts of solar power to the UK from Tunisia if the...