Emissions trading may allow the rich to shift carbon burden to the poor

The working paper, which set out to investigate climate-change policy ethics, says that “some people worry that emissions trading allows the wealthy to evade their responsibilities.”

The paper says that climate-change policy involves “underappreciated ethical dimensions.”

It says that greenhouse gas emissions might be reduced by several approaches – each of which raises different considerations of ethics and justice.

Although cap-and-trade systems have the virtue that they are “almost the only deliberate climate change policy to actually reduce”, the authors say, the effectives of it is questionable. they say that the reason why governments and the UN put these systems in place is “to garner political support from a wide spectrum of relevant actors.”  

But in reality, emissions trade causes an unequal distribution of CO₂ emissions which affect developing countries by auctioning off their caps to more polluting companies.

The trade in permits is worth around $150 billion annually and with caps on CO2 emissions lowering, this figure is bound to grow.

Concerns are raised about the “distributional justice of emissions trading.”

According to emissions trading, a cap on the total emissions allowed is set, and allowances adding up to the cap are provided to the companies regulated by governments. The paper questions whether emissions trading converts what ought to be a fine into a fee.

Carbon offsets – albeit promoting green technology and sustainable development – face challenges “which open the way to potential gaming and fraud.”

Although regulatory bodies are in place, government will rarely know the whole truth about a company’s CO₂ emissions and how they are being distributed.

This is because opportunities to manage emissions figures are done at the operational level of individual firms, who may try and conceal true data.

Some concerns are raised that cap-and-trade puts a price tag on the natural environment. It argues that implementing climate change policies is also likely to change our relationship with nature, raising an ethical issue of “owning what should not be owned.”

Looking at the natural environment as a commodity creates an imbalance between business and the societies in which they work, therefore creating a constant conflict between regulation and government.

Finally, the report questions the actual effectiveness of emissions trading in reducing emissions.

The authors say: “If climate policies are not able to reduce emissions at the appropriate rate and scale, the risks imposed upon future generations would likely be considered to contravene intergenerational justice.”

The authors conclude by saying that although “a single cap-and-trade system alone would not be an adequate response to climate change”, it is “morally valuable, rather than a morally suspect contribution” to moving low-carbon economy.

Image: Squeaks2569 | Flickr