Monday, April 12, 2010

Profitting from polluting

The Sunday Herald carries a story that some businesses are in for a pollution and profit bonanza because of loopholes in the European scheme to limit climate emissions that will see giant corporations make billions of pounds and pump millions of tonnes of carbon into the atmosphere.

The European emissions trading scheme was launched in 2005. Covering more than 10,000 industrial plants across the continent, it is the main tool for cutting greenhouse gas emissions to try to limit dangerous climate change.The scheme works by giving companies a limited number of legal permits to pollute, which can be traded if they cut their pollution. It is meant to act as an incentive to reduce emissions. But it has been criticised because pressure from industry has resulted in the caps being set too high, allowing companies to carry on polluting without any financial penalties.This problem has now been made much worse by the economic downturn. As businesses have closed, or shrunk, emissions have plummeted so that they are now well below the caps.Companies will now be able either to boost their climate pollution or sell unused pollution permits for millions of pounds, enabling others to increase their emissions.If the heavy industrial companies sold off their excess permits at today’s prices, they would profit by over £2 billion.

Efforts to cut climate pollution would be thwarted if excess pollution permits were simply sold to industry elsewhere. According to Dr Richard Dixon, director of the environment group, WWF Scotland. “As it stands, businesses across Europe will be able to make more profit by exploiting this loophole to carry on polluting pretty much as usual,” he told the Sunday Herald.

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