Washington, DC — President Obama’s proposed cap-and-trade plan for reducing greenhouse gases will not achieve the reductions quickly enough to prevent devastating climate change, according to an analysis posted today by Public Employees for Environmental Responsibility (PEER). The broad political support for cap-and-trade scheme is rooted in its biggest flaw – that an incremental approach designed to keep prices for carbon-based energy low will be insufficient to accomplish a quick shift in energy sources.
The President’s plan is summarized on the White House web site as “Implement an economy-wide cap-and-trade program to reduce greenhouse gas emissions 80 percent by 2050”. Laurie Williams and Allan Zabel, two EPA enforcement attorneys (writing as private citizens) with experience in cap-and-trade and other forms of emission trading have written an analysis entitled Keeping Our Eyes on the Wrong Ball which rebuts the central promises behind this approach, including that –
- The Acid Rain Analogy Is Misplaced. Unlike greenhouse gas control, EPA’s Acid Rain program did not require replacing the vast majority of existing energy infrastructure in a relatively short time nor did it depend on spurring major innovation. The Acid Rain program simply induced utilities to switch from high sulfur coal to a readily available substitute – low sulfur coal. A more apt analogy to the current situation is the fees adopted under the Montreal Protocol that led to the phase out of ozone-destroying chlorofluorocarbons (CFCs) in the 1990s;
- Reliance on Carbon Sequestration and Undeveloped Clean Coal Technologies Is Illusory. None of the technologies needed to eliminate greenhouse gas emissions from coal-power yet exist but, according to leading scientists such as Jim Hansen of NASA, there is an immediate need to make sharp reductions to avoid irreversible climate change; and
- Cap-and-Trade Schemes Are Inherently Vulnerable to Scams. Emission trading systems, especially on an economy-wide basis are difficult to police and subject to questionable offsets.
A central point of the Wrong Ball analysis is that emissions trading is designed to keep the price of fossil-fuel energy relatively low and thus will not create sufficient incentive to invest in carbon-free energy and disinvest in coal. The only mechanism, the authors argue, that will rapidly flip the economic incentives driving our energy economy is a system-wide carbon fee.
“We should pay attention to what the specialists who would have to administer a cap-and-trade have to say,” stated PEER Executive Director Jeff Ruch, calling the Williams-Zabel analysis an important contribution to the national debate of cap-and-trade versus carbon tax that is now being waged. “A political consensus around cap-and-trade does little good if it does not work as promised – and we do not have the luxury of getting it wrong the first time.”