Carbon Cap Trade
Carbon cap trading is something that the world administrators should have thought of a very long time ago. This is not only true from the perspective of an ecologist but something that any businessman would agree too. Carbon cap trading is proving to be just the answer to the problem that is affecting every individual in the world – global warming.
Every country in the world has tried ever so hard to contain pollution. However, not every administration in the world, be it a country, or a state within a country was able to effectively control carbon emissions into the atmosphere. There were many reasons for their failure to do so, mostly monetary restrictions. It was not always economically feasible for an industry to implement eco-friendly machinery as doing so only meant that they had to cut back on their profits. This gave rise to the other reason for administrative failure to contain polluting giant industries. It was economical for industry to lobby officials into less restrictive rules rather than having to dole out taxes and fines for not complying with pollution laws.
This failure on the local level to contain carbon emissions into the atmosphere led to a huge rise in the levels of carbon in the air. This in turn led to a planet sized problem of global warming. Because carbon dioxide is able to trap infrared rays from the sun they heat up the air and everything that comes in contact with it. This is promising to lead to catastrophic consequences all over the world. Realizing the problem some countries came together in 1997 and created what they named the Kyoto Protocol. This was an agreement to bring down carbon levels in the atmosphere to levels lower than 5.2 percent that were recorded in 1990. They decided to cap the amount on carbon that each country could emit and increase this capping every year by reducing the allocation of carbon for each country.
This had a two pronged affect on efforts to save the environment. It allowed for a system where polluting companies had to pay for the damage they did and at the same time gave them a way out of having to invest in machinery in one go to lower their carbon emissions. They could resort to carbon cap trade and buy additional carbon credits from non-polluting industries or countries if it was more economical than investing in more eco friendly processes within a short period of a year.
By putting a cap on the amount of pollutants a country could emit into the atmosphere the Kyoto Protocol managed to create a system where countries, individuals, and industries could buy and sell a unit of carbon termed a carbon credit which is one metric ton of carbon dioxide or its equivalent polluting gas. Priced at 22 USD per credit in the present market countries that exceed the number or credits they are allowed can purchase exactly the number of credits they exceed in a year or more from countries that have not used up the entire quota of credits they are allowed. This is cap and trade.
This is what carbon cap trading is all about. Carbon credits can be registered with registries in individual countries and bought by countries, industries and even individuals at the prevailing rates at the climate exchanges set up for the purpose of trading these credits.
Tags: cap, cap and trade, cap carbon, Carbon Cap Trade, carbon cap trading, carbon emissions, climate exchanges, emissions, Global warming, investing, Kyoto Protocol, trading credits
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