It is as though a line of dominos has suddenly appeared, awaiting the slightest push to set off a chain reaction. When the dominos begin to fall, the world will suddenly have a powerful and effective tool to reduce carbon emissions, one of the most environmentally destructive aspects of modern human activity.
The largest source of carbon emissions – about 45% of all emissions globally – are electricity generation power plants that burn fossil fuels. The idea behind emissions trading – the political shorthand has become “cap and trade” – is that mandated carbon emissions limits will drive a robust market as cleaner plants seek to sell their unused allowances. Dirty power plants have to pay cleaner power plants for rights to emit, creating an economic incentive for plants to run cleaner. Technology innovation and infrastructure investment would follow and electricity producers would strive to become sellers not buyers of emissions allowances.
The sticking point has been the difficulty in creating a truly global carbon marketplace. The US, responsible for 25% of emissions, never ratified Kyoto. Without American participation and leadership, the EU, Asian and Australian exchanges offer only patchwork regional solutions. Yetclimate change is a global problem at its core.