EU's 'carbon fat cats' get rich off trading scheme: study

[Bugs]

Ain't this a bitch.

Europe's system for industrial carbon quotas has enriched the continent's biggest polluters, with ten firms together reaping permits for 2008 alone worth 500 million euros, a new report revealed.

Dominated by steel and cement makers, the same "carbon fat cats" stand to collect surplus CO2 permits that -- at current market rates -- could be worth 3.2 billion euros (4.3 billion dollars) by 2012, it said.

This is roughly equivalent to the entire EU investment in renewable energy and clean technology under its economic recovery plan, according to Sandbag, a non-profit group in Britain that analyses carbon market policy.

"Emissions trading is meant to be the central policy for cutting CO2 levels," said Anna Pearson, Sandbag's top policy analyst.

"The fact that companies are able to make large sums of money for doing nothing highlights that the trading scheme must be reformed and EU climate change target strengthened."

The details are at… http://www.breitbart.com/article.php?id=CNG.6a237570be4660439e371341ae8452d5.a41&show_article=1

This is the kind of trading scheme that is the model Obama is trying to impose on America, and hence, intro which we will follow. The idea is that each state, then industry, then individual plant each divide an allocation of permissible pollution (called the Annual Absolution), and can sell what it doesn't use. There are known as Indulgences, and their price reached a peak at 30 euros, about $40 a tonne, before it turned out that there is no scientific basis for the policy.

Since the fraud was exposed, the price has collapsed to 13 euros a tonne, at present. Still, 13 euros x a gazillion tonnes ... it adds up.

Among the top ten beneficiaries, steelmaker ArcelorMittal collected more than 40 percent of the 2008 excess permits, reported Sandbag.

French cement giant Lafarge got about 12 percent, with Tata steel group subsidiary Corus and Swedish steel maker SSAB-Svenskt Stal each claiming about 10 percent.

Even if the permits are not directly resold for profit, the value will still remain on the companies' books, rising or falling with the market.

Most of the permits were generated simply because the companies were allocated more free permits than they wound up using, according to the report.

"Little or no actual 'effort' toward emissions reductions need have taken place, yet these companies will be able to literally bank the profits," it said.

Just so you know, steelmakers and cement plants are huge polluters.

I guess this means ... the critics were right.

What a sad end for so many well-meant hopes, those hopes taken and crushed by venal forces who care nothing in mankind survives or not ... it just shows you, good intentions are not enough.

Comments?

[M.Dancer]

Sounds good. Obviously carbon permits are a commodity that can be sold. It's what will mpotivate a carbon producing company to reduce their footprint and to reap the benefits on the open market.

It's a win win formulae.

[Bonam]

The point with these permits is it basically imposes an overall cap. If some companies were allocated more permits than they can spend, then they will be able to sell the excess and make a profit. This rewards them for polluting less than expected. As the years pass, the overall amount of permits allocated will be decreased over time, so companies will have to lower emissions in order to stay within their permitted amount. Those that race ahead of the trend will be able to sell their excess permits, thus profiting off their reduced emissions, which those that can't keep up with the trend will have to spend money to buy permits.

The idea seems fundamentally sound (if you accept the premise that we should cut emissions), even if the initial allotment of permits to certain companies was excessive.

Edited March 5, 2010 by Bonam

[Michael Hardner]

As others have posted, though, the UN's carbon market has huge exposures to corruption. Companies are given credits for future development, if they change plans to a more carbon-neutral proposal.

This leads to people saying "initially this project was to be fueled by coal, but since I'm now using hydroelectric (wink, wink) I should be receiving X million credits".

[Bonam]

The UN should obviously not be the body that is in charge of carbon trading schemes. The UN is powerless, corrupt, and too heavily influenced by third world interests and ideologies. In my opinion, the UN pretty much needs to be scrapped and something new put in its place. But that's a whole different topic.

Nations or supranational blocs (like the EU) should implement their own systems, if they want to use a carbon trading scheme, and I believe that that's generally been the idea so far.

[Topaz]

I saw a documentary on this and it was talking about one Texas oil baron, that went down to South America, bought thousands of acres of the forest there and in return he will collect a numbers of points in carbons, which he can turn in to millions and billions of dollars. This is the new stock market to get rich. There are even carbon brokers that will help find land that can be kept for carbon points. So when Harper mentioned putting carbons under ground, who ever owns the land, will highly profit. The story showed an average US family going over to the Third World countries to buy up land and hold it for carbon profits. There was also farmers in the US, that didn't til the ground, prevented carbons rising out of the ground are getting carbon points.

[Bonam]

If some guy buys thousands of acres of forest, and isn't building anything there and it's not being chopped down, then they just spent their private money to, effectively, protect that forest.

[Pliny]

Governments must find new ways to earn revenues. They can no longer just raise people's incomes through inflation and tax that. It is self-defeating. Revenues on gas, tobacco and alcohol will dwindle to unsustainable levels as we all start taking the bus and get healthy by reducing our consumption of these evil products. The same will happen to MacDonald's. It will start to disappear as junk and fast foods become targets of taxation. There has to be a more sustainable means of taxation. It isn't likely that we will stop living and breathing so let's tax carbon emissions. We have to ignore the fact that things that are taxed tend to disappear.

We could calculate the minimal carbon footprint of a human being and start taxing on the basis the amount they will accrue during their childhood, noting their activity level and making adjustments, and start paying on once they reach a working age.

People aren't about to disappear so government revenues will be secured and even if the population does start to decline it means there will be fewer people to manage and thus more economical for government. Isn't that brilliant.

[GostHacked]

Sounds good. Obviously carbon permits are a commodity that can be sold. It's what will mpotivate a carbon producing company to reduce their footprint and to reap the benefits on the open market.

It's a win win formulae.

However it does not reduce emissions at all. The emissions are just happening somewhere else, and someone gets cash because of it.

[M.Dancer]

However it does not reduce emissions at all. The emissions are just happening somewhere else, and someone gets cash because of it.

The credits are finite and as their value increases, the motivation to reduce becomes greater. Those whoi can reduce more can sell their excess credits and use the capital to either further reduce or do with as they wish.

Eitherway, it capitalizes carbon reduction.

[Pliny]

The credits are finite and as their value increases, the motivation to reduce becomes greater. Those whoi can reduce more can sell their excess credits and use the capital to either further reduce or do with as they wish.

Eitherway, it capitalizes carbon reduction.

The reduction of Carbon production means life is disappearing on the planet. Mainly human life.

[eyeball]

The reduction of Carbon production means life is disappearing on the planet. Mainly human life.

This is so typical of the alarmist dogma the Church of AGW Denialism likes to propagate.

[GostHacked]

The credits are finite and as their value increases, the motivation to reduce becomes greater. Those whoi can reduce more can sell their excess credits and use the capital to either further reduce or do with as they wish.

Eitherway, it capitalizes carbon reduction.

Instead of Credits, they all should be fined when they go over their cap. That will solve a few things.

[M.Dancer]

Instead of Credits, they all should be fined when they go over their cap. That will solve a few things.

Sure will. Companies that are fined will simply move and take the jobs with them.

[eyeball]

Sure will. Companies that are fined will simply move and take the jobs with them.

They can't take the oil-sands with them.

[M.Dancer]

They can't take the oil-sands with them.

Which would be a real deal breaker if the oil sands was the only place on earth where there was oil...

[eyeball]

All the same, do we really need or want the sorts of companies that avoid fines, penalties or the cost of accounting for their environmental impact by skipping out of the country? In any case we can simply seize their assets and impose import duties against any countries these miscreants set up shop.

In addition to using carbon credits to curb emissions I think levies on imports that don't meet standards that are necessary to protect environment are appropriate. This of course should work both ways and force us to clean up our acts too.

[M.Dancer]

All the same, do we really need or want....

All the same, we have agreed to use carbon credits....talk of fines is hot air and contribute to global something...

[blueblood]

Here's a better idea, how about no carbon credit trading scheme. And we let the price of oil dictate how much we use. Nothing like 147 dollar oil to get SUV's off the road in a hurry.

As for complaining about companies moving in the case of fines, wouldn't they be wanting to move if their bottom lines were being attacked by some complicated trading scheme.

[eyeball]

Here's a better idea, how about no carbon credit trading scheme. And we let the price of oil dictate how much we use. Nothing like 147 dollar oil to get SUV's off the road in a hurry.

Reality works for me. Imagine if oil companies had to pay for the cost of militarily securing access to oil fields themselves?

As for complaining about companies moving in the case of fines, wouldn't they be wanting to move if their bottom lines were being attacked by some complicated trading scheme.

No unless they figured out ways to exploit that trading scheme. Here's a clue, its probably complicated for a reason.

[blueblood]

Reality works for me. Imagine if oil companies had to pay for the cost of militarily securing access to oil fields themselves?

They do that with royalty payments. Some are more favorable than others.

No unless they figured out ways to exploit that trading scheme. Here's a clue, its probably complicated for a reason.

And everyone suffers because of it.

[Pliny]

This is so typical of the alarmist dogma the Church of AGW Denialism likes to propagate.

When we have something to really worry about, AGW will be a forgotten topic. Just like....um...H1N1 for instance.

[Bonam]

All the same, do we really need or want the sorts of companies that avoid fines, penalties or the cost of accounting for their environmental impact by skipping out of the country? In any case we can simply seize their assets and impose import duties against any countries these miscreants set up shop.

SEIZE THEIR ASSETS? The day something like that happens, Canada will turn from a democratic country to a totalitarian dictatorship. At least your tyrannical tendencies have been exposed for all to see...

Edited March 16, 2010 by Bonam

[M.Dancer]

SEIZE THEIR ASSETS? The day something like that happens, Canada will turn from a democratic country to a totalitarian dictatorship. At least your tyrannical tendencies have been exposed for all to see...

Eyeball is a conflicted totalitarian. He doesn't want to admit he is one and feels his policies are merely nationalist...in fact, he is a nationalist totalitarian. He's a Natot.

[Pliny]

Eyeball is a conflicted totalitarian. He doesn't want to admit he is one and feels his policies are merely nationalist...in fact, he is a nationalist totalitarian. He's a Natot.

"Natot"...sounds Canadian...from the far north... might catch on.

Eyeball is a Libertarian. I suppose as long as one gets to dictate the terms.. Libertarianism is great.