Psyche, Science, and Society

Carbon trading no panacea

March 13th, 2007

Now that global warming is finally getting attention, massive attention is focussed upon carbon trading schemes that allow companies to pollute, as long as they purchase alleged offsetting savings elsewhere. David Morris at AlterNet shows that these schemes are easily open to gaming and are likely to make speculators and manipulators rich while doing little or nothing for the environment.

Al Gore has done great work calling attention to the dangers posed by global warming. But his enthusiasm for carbon trading threatens to undo this good. It may be the case that global warming cannot be addressed without, at a minimum, significant changes to our corporate-controlled so-called “free market” system. The world may have to choose between “free markets” and “freedom to live.” Unfortunately, it looks like we’ll choose the former.

The last thing we need is to have the world endorse schemes that will do little to reduce greenhouse gas emissions. The S&L and Enron scandals cost billions. This scandal could cost us a livable world.

The Dag Hammarskjold Foundation did an excellent analysis of carbon trading in its September 2006 Development Dialogue magazine. “With a bit of judicious accounting,” the report found, “a company investing in foreign ‘carbon-saving’ projects can increase fossil emissions both at home and abroad while claiming to make reductions in both locations.”

Carbon traders seek the lowest cost carbon offset. Which almost always means tree planting in some far off country, without regard to its long-term effects on the community or the environment, or a modest reduction in the emissions of a highly polluting factory in a developing nation. A company needing, or wanting, offsets may have to choose between investing a significant amount of capital that has long-term and very substantial savings, or buying much lower cost and short-term offsets. From a short-term economic perspective, the latter will always be the preferred choice. A study reported in Nature, the scientific journal, supported this proposition. It found that only 2 percent of the United Nations’ trading projects involving either renewable energy or communities that follow eco-friendly practices with regard to tree cultivation and harvesting.

Entry Filed under: Environment, Gobal Warming, Uncategorized