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Cyclefrance · 05-02-2006, 09:37 AM

Green Policy turns into Greenbacks...

Oops! The EU Carbon Emissions Trading Scheme, meant to act as a device to limit and reduce the amount of carbon pumped into the atmosphere looks as though it has given power companies a £1 billion windfall profit instead.

It's a bit hard to follow, but essentially, firms had been given the trading permits free of charge by the government and their relative value is set by pricing the carbon available against a permit. Companies that produced low carbon output would be able to sell their excess to those who produce high carbon output and needed the extra capacity - overall it was hoped that the scheme would see carbon levels reduce as firms either used their earnings to improve emissions or saw it more advantageous to improve emissions rather than pay for extra carbon capacity without such change

Now the rapidly increased value of electricity has pushed the carbon value up and so those selling spare 'carbon capacity' have seen the price they are being offered soar - and they haven't had to make any investment at all in new technology to reduce emissions further to do reap this reward. Likewise those paying have the extra dosh to do so. A clear case of using the wrong device to achieve the desired result, and yet another example of a badly thought through, government-inspired cock-up. Our government has even been fighting to have the carbon limits raised, blissfully unaware of what was happening with the original scheme.

Nice to know they have everything under control.....

05-02-2006, 09:37 AM	#5
Cyclefrance Pump my ride! Join Date: Aug 2005 Location: Deep countryside of Surrey , England Posts: 1,890	Green Policy turns into Greenbacks... Oops! The EU Carbon Emissions Trading Scheme, meant to act as a device to limit and reduce the amount of carbon pumped into the atmosphere looks as though it has given power companies a £1 billion windfall profit instead. It's a bit hard to follow, but essentially, firms had been given the trading permits free of charge by the government and their relative value is set by pricing the carbon available against a permit. Companies that produced low carbon output would be able to sell their excess to those who produce high carbon output and needed the extra capacity - overall it was hoped that the scheme would see carbon levels reduce as firms either used their earnings to improve emissions or saw it more advantageous to improve emissions rather than pay for extra carbon capacity without such change Now the rapidly increased value of electricity has pushed the carbon value up and so those selling spare 'carbon capacity' have seen the price they are being offered soar - and they haven't had to make any investment at all in new technology to reduce emissions further to do reap this reward. Likewise those paying have the extra dosh to do so. A clear case of using the wrong device to achieve the desired result, and yet another example of a badly thought through, government-inspired cock-up. Our government has even been fighting to have the carbon limits raised, blissfully unaware of what was happening with the original scheme. Nice to know they have everything under control..... __________________ Always sufficient hills - never sufficient gears Last edited by Cyclefrance; 05-02-2006 at 10:37 AM.