Talk:Carbon emission trading/Archive 1

Archive 1

Do we really need this article ?

the main article emissions trading itemises all the major emissions tradings currently in place or planned, with links to an article describing the scheme where extant. The big one, the carbon trading scheme in Kyoto, has spawned most of the other carbon systems, but was inspired by California's SOx market. I suggest we maintain this as a simple page that redirects to emissions trading - just like carbon emissions trading already does. Also, if some of the WCI members have their way, their schemes will be linked with other environmental schemes such as water management, making this type of article even more tenuous Ephebi (talk) 22:23, 1 February 2008 (UTC)


New section on economics and rewrite of criticisms

I've deleted these two paragraphs:


Moral tradeoff

With carbon emission trading, there is the rarely discussed concern of moral tradeoff. The idea is exemplified in the study, "A Fine is a Price"[9], conducted by Uri Gneezy and Aldo Rustichini with a selected group of Haifa childcare centers in Israel. The study showed that monetary fines on late-coming parents did not deter the tardy habit and instead, created an unexpected economic and moral tradeoff for the late-coming parents as they could now compensate for their tardiness under the new fine system.[citation needed][original research?]

However, this analogy does not take into account an important distinction between late fees at childcare centres and cap-and-trade emissions reduction schemes: the price paid by a late-coming parent has no impact on the price to be paid by other late-coming parents. That is, there is no bidding system in place where parents compete for the right to arrive late. This contrasts with an emissions trading scheme, where one firm's willingness to pay for carbon emissions reduces the number of permits available to other emitters, thereby increasing scarcity and hence the price of carbon pollution.[original research?]

Irrelevance

Buying and selling carbon units does not, in itself, do anything to reduce emissions. Emission reduction requires technology, not accounting. There is a risk that the scheme will do little but make money for traders. In response, the carbon trading regime exists to directly finance investments that reduce carbon emissions.


In my view, these two paragraphs are not of sufficient quality to be included in this article.

First paragraph

I don't think this is notable or of sufficient quality to be included in Wikipedia. It is not included in the IPCC literature assessment. I've not seen it in any other authorative sources. I've put in higher quality arguments that point to weaknesses of emissions trading.

Second paragraph

Uncited. It's not consistent with the sources I've referred to, which say that emissions trading can be an effective way of reducing emissions. Enescot (talk) 09:06, 26 April 2010 (UTC)

Voluntary surrender of units

This section just seems to be promotional material for a particular viewpoint, which I don't think is notable or appropriate. The main advantage of emissions trading is that it lowers the overall costs of meeting a target. The idea of buying permits to increase the permit price is absurd (except in the case of government's controlling the price, but no one seriously suggests this). The way of getting the permit price sufficiently high is for the government to limit the number of permits that it gives away. What percentage of permits in the carbon market have been retired? I doubt that it is very much. Enescot (talk) 02:58, 28 April 2010 (UTC)

I agree it is an absurd viewpoint. However I have heard well-intentioned people talk favourably about buying and cancelling units in order to lower 'The Cap'. So I think it needs to be left in, subject to better wording and providing the counter viewpoint. Mrfebruary (talk) 01:53, 29 April 2010 (UTC)
I have added one more example and one critique. Mrfebruary (talk) 11:58, 3 August 2010 (UTC)

Polluter pays principle

What about Polluter pays principle? Watti Renew (talk) 18:58, 14 November 2012 (UTC)

Polluter pays principle is used in the European Union Environmental Law. The polluter is responsible of the costs of the consequenses of its pollution. The likelihood of the consequenses of the polluting action is juridically enough for the responsiblity. The polluter has responsibility to show its non guilty, if it can. In my opinion this means that the CO2 emittors are resonsible for the costs of the extreme weather costs. Carbon trading can not dilute this responsibility. Watti Renew (talk) 17:43, 15 November 2012 (UTC)

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Dr. Spraggon's comment on this article

Dr. Spraggon has reviewed this Wikipedia page, and provided us with the following comments to improve its quality:


Under Carbon trading, a country having more emissions of carbon is able to purchase the right to emit more and the country having less emission trades the right to emit carbon to other countries. More carbon emitting countries, by this way try to keep the limit of carbon emission specified to them.

I would site the European Emission Trading market (http://ec.europa.eu/clima/policies/ets/index_en.htm) and say:

Under Cabon trading companies are provided with allowances-a number of tons of Carbon (or other Greenhouse Gas) which they are able to emit. They then may trade these allowances on an open market. If they can reduce their emissions of carbon more cheaply than the market price then they should do so and sell their excess permits at a profit. On the other hand if reducing their emissions are more expensive than the market price they should buy permits from others who can reduce their emissions more cheaply. In this way carbon is reduced as cheaply as possible.


We hope Wikipedians on this talk page can take advantage of these comments and improve the quality of the article accordingly.

Dr. Spraggon has published scholarly research which seems to be relevant to this Wikipedia article:


  • Reference : John K. Stranlund & James J. Murphy & John M. Spraggon, 2014. "Price Controls and Banking in Emissions Trading: An Experimental Evaluation," Working Papers 2014-01, University of Alaska Anchorage, Department of Economics.

ExpertIdeasBot (talk) 15:54, 19 May 2016 (UTC)

Dr. Peterson's comment on this article

Dr. Peterson has reviewed this Wikipedia page, and provided us with the following comments to improve its quality:


Instead of

"This form of permit trading is a common method countries utilize in order to meet their obligations specified by the Kyoto Protocol; namely the reduction of carbon emissions in an attempt to reduce (mitigate) future climate change.

Under Carbon trading, a country having more emissions of carbon is able to purchase the right to emit more and the country having less emission trades the right to emit carbon to other countries. More carbon emitting countries, by this way try to keep the limit of carbon emission specified to them."


write:

Emission trading can take place at different levels: - state level: under the Kyoto Protocol countries can trade or rather exchange emissions in order to meet their obligations (see e.g. http://unfccc.int/kyoto_protocol/mechanisms/emissions_trading/items/2731.php) - firm level: in firm level carbon emissions trading schemes firms have to submit permits for each unit of emitted carbon. The permits are handed out for free or auctioned and can then be traded. The largest existing firm level carbon emission trading system is the European Emissions Trading Scheme (see https://en.wikipedia.org/wiki/European_Union_Emission_Trading_Scheme)

Under Carbon trading, a country/firm having more emissions of carbon is able to purchase the right to emit more and the country/firm having less emission trades the right to emit carbon to other countries. More carbon emitting countries, by this way try to keep the limit of carbon emission specified to them.


Furthermore, I do not think the Section on ethics and Fairness fits to the Topic.

Add under "Taxes versus caps"

For a comparison of taxes and emissions trading see "Carbon Taxes vs. Cap and Trade: A Critical Review, Lawrence H. Goulder, Andrew Schein, NBER Working Paper No. 19338, Issued in August 2013". http://www.nber.org/papers/w19338


Section on Market Trend: Delete and write instead. The world bank annually summarizes the market development of the steadily increasing global carbon market. The 2015 Report can be found here: http://documents.worldbank.org/curated/en/2015/09/25053834/state-trends-carbon-pricing-2015

This should also be added to external links". Generally, the article is a Little outdated and there is newer relevant literature. the sections are rather arbitrary.


We hope Wikipedians on this talk page can take advantage of these comments and improve the quality of the article accordingly.

We believe Dr. Peterson has expertise on the topic of this article, since he has published relevant scholarly research:


  • Reference 1: Sonja Peterson & Gernot Klepper, 2007. "Distribution Matters ; Taxes vs. Emissions Trading in Post Kyoto Climate Regimes," Kiel Working Papers 1380, Kiel Institute for the World Economy.
  • Reference 2: Sonja Peterson, 2006. "Efficient Abatement in Separated Carbon Markets: A Theoretical and Quantitative Analysis of the EU Emissions Trading Scheme," Kiel Working Papers 1271, Kiel Institute for the World Economy.

ExpertIdeasBot (talk) 16:48, 27 July 2016 (UTC)

Dr. Andre's comment on this article

Dr. Andre has reviewed this Wikipedia page, and provided us with the following comments to improve its quality:


This form of permit trading is a common method countries utilize in order to meet their obligations specified by the Kyoto Protocol; namely the reduction of carbon emissions in an attempt to reduce (mitigate) future climate change.

This form of permit trading CAN TAKE PLACE AMONG COUNTRIES OR AMONG FIRMS. IT is a common method countries utilize in order to meet their obligations specified by the Kyoto Protocol; namely the reduction of carbon emissions in an attempt to reduce (mitigate) future climate change. THERE IS ALSO SOME CARBON TRADING AMONG FIRMS THAT ARE SUBJECT TO A NATIONAL OR INTERNATIONAL CAP-AND-TRADE PROGRAM, SUCH AS THE EUROPEAN UNION EMISSION TRADING SYSTEM (EU ETS)


Under Carbon trading, a country having more emissions of carbon is able to purchase the right to emit more and the country having less emission trades the right to emit carbon to other countries. More carbon emitting countries, by this way try to keep the limit of carbon emission specified to them.

Under Carbon trading, a country OR A FIRM THAT having more emissions of carbon THAN THE NUMBER OF PERMITS IT HOLDS, is able to purchase the right to emit more and the country OR FIRM having MORE PERMITS THAN EMISSIONS emission trades the right to emit carbon to other countries OR FIRMS. THE PURPOSE IS THAT THE PERMITS ARE HOLD BY THOSE COUNTRIES OR FIRMS THAT VALUE THEM MOST, I.E., THOSE THAT BEAR HIGHER ABATEMENT COSTS.


I'm not sure if the subsections "Cost and valuation" and "Ethics and fairness" fit in this article. They would probably fit better in an article about "Climate Change", but not much in an article about "Carbon Emission Trading".


Subsection "Taxes versus caps".

A clasical reference about the advantages of using quanties or price regulation is

Weitzman, M. L. (1974). Prices vs. quantities. The review of economic studies, 41(4), 477-491.



We hope Wikipedians on this talk page can take advantage of these comments and improve the quality of the article accordingly.

We believe Dr. Andre has expertise on the topic of this article, since he has published relevant scholarly research:


  • Reference : Francisco J. Andre & Luis M. de Castro, 2015. "Incentives for Price Manipulation in Emission Permit Markets with Stackelberg Competition," Working Papers 2015.06, Fondazione Eni Enrico Mattei.

ExpertIdeasBot (talk) 20:13, 24 September 2016 (UTC)

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NPOV Merger Proposal

To comply with WP:NPOV I propose merging a portion of Criticism Kyoto Protocol ( the portion on Carbon trading ) with Carbon trading emissions the merge will allow us to obtain a stronger NPOV. NPOV requires us to present information fairly, proportionately, and without bias. the main problem is that it is unfair that the criticism is cast off to a tiny article instead of woven if fairly with the main article. We don't want to give undue weight to criticism so we need to remember that. but the solution is 1 article written well not 2 different articles. Size shouldn't be a problem but if it is we can spin off large topics into sub-topics.

NPOV is immune from a consensus override so we have to find a NPOV sollution that meets the 3 requirements. and NPOV has a supremacy clause so other policies like WP:Merge Test and WP:Article Size can't over ride it. I know the merger will take some work and a few edits but the end result will be a better stronger wikipedia. Bryce Carmony (talk) 04:31, 16 March 2015 (UTC)

Removing stale merge proposal with no support over 2.5 years; NPOV issues can be dealt with in other ways, as many have been over the last 2.5 years. I've added see also templates to link the sections to aid readers. Klbrain (talk) 21:20, 10 September 2017 (UTC)

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Visual Diff bugs and IABot

I'm having problems reviewing the edit just done : (Rescuing 73 sources and tagging 0 as dead.) #IABot (v2.0.9.5) The visual diff, https://en.wikipedia.org/w/index.php?title=Carbon_emission_trading&diff=prev&oldid=1167803284 is problematic. It shows big edits in red that don't actually exist when I look at the source diff. The bot changes some cites from multi-line format to single-line, and does the reverse with others. I don't get it. The changes re. thecornerhouse.org.uk/summary don't make sense in either diff. But I can't see anything that's clearly worse, and some stuff that's better, so leaving as is. Weird. - RudolfoMD (talk) 02:34, 30 July 2023 (UTC)

Is any of this content from an example calculation useful?

I've removed this example textblock from emissions trading. Would any of it fit here? It's not sourced though and reads more like a textbook so I doubt it.

Example

Emissions trading through Gains from Trade can be more beneficial for both the buyer and the seller than a simple emissions capping scheme.

Consider two European countries, such as Germany and Sweden. Each can either reduce all the required amount of emissions by itself or it can choose to buy or sell in the market.

 
Example MACs for two different countries

Suppose Germany can abate its CO2 at a much cheaper cost than Sweden, i.e. MACS > MACG where the MAC curve of Sweden is steeper (higher slope) than that of Germany, and RReq is the total amount of emissions that need to be reduced by a country.

On the left side of the graph is the MAC curve for Germany. RReq is the amount of required reductions for Germany, but at RReq the MACG curve has not intersected the market emissions permit price of CO2 (market permit price = P = λ). Thus, given the market price of CO2 allowances, Germany has potential to profit if it abates more emissions than required.

On the right side is the MAC curve for Sweden. RReq is the amount of required reductions for Sweden, but the MACS curve already intersects the market price of CO2 permits before RReq has been reached. Thus, given the market price of CO2 permits, Sweden has potential to make a cost saving if it abates fewer emissions than required internally, and instead abates them elsewhere.

In this example, Sweden would abate emissions until its MACS intersects with P (at R*), but this would only reduce a fraction of Sweden's total required abatement.

After that it could buy emissions credits from Germany for the price P (per unit). The internal cost of Sweden's own abatement, combined with the permits it buys in the market from Germany, adds up to the total required reductions (RReq) for Sweden. Thus Sweden can make a saving from buying permits in the market (Δ d-e-f). This represents the "Gains from Trade", the amount of additional expense that Sweden would otherwise have to spend if it abated all of its required emissions by itself without trading.

Germany made a profit on its additional emissions abatement, above what was required: it met the regulations by abating all of the emissions that was required of it (RReq). Additionally, Germany sold its surplus permits to Sweden, and was paid P for every unit it abated, while spending less than P. Its total revenue is the area of the graph (RReq 1 2 R*), its total abatement cost is area (RReq 3 2 R*), and so its net benefit from selling emission permits is the area (Δ 1-2-3) i.e. Gains from Trade

The two R* (on both graphs) represent the efficient allocations that arise from trading.

  • Germany: sold (R* - RReq) emission permits to Sweden at a unit price P.
  • Sweden bought emission permits from Germany at a unit price P.

If the total cost for reducing a particular amount of emissions in the Command Control scenario is called X, then to reduce the same amount of combined pollution in Sweden and Germany, the total abatement cost would be less in the Emissions Trading scenario i.e. (X — Δ 123 - Δ def).


The example above applies not just at the national level, but also between two companies in different countries, or between two subsidiaries within the same company. EMsmile (talk) 12:18, 19 September 2023 (UTC)

Adding more redirects

(copied from talk page of emissions trading where I also wrote about it just now): I've just changed a whole bunch of redirects that were redirecting to this article to rather redirect to carbon emissions trading, for example anything to do with "cap and trade" or "emissions trading". My reasoning is that in current usage, emissions trading is mainly used for the carbon emissions trading and far less often for the other pollutants. So readers and potential editors are more likely to want to go to carbon emissions trading. You can also see in the pageviews how the views for emissions trading have gone done and those for carbon emissions trading have gone up, see here. EMsmile (talk) 13:38, 19 September 2023 (UTC)