COLUMNS

Tipping points

Wade McIntyre
Wade McIntyre

Some will remember when Americans were threatened by acid rain in the late 1980s. Everyone wondered how the nation was going to stop acidic pollution caused by sulfur dioxide released from coal-fired power plants.

Today, of course, fear of acid rain is non-existent.

The Environmental Protection Agency solved the problem by dangling carrots in front of the polluters. EPA put a nationwide cap on the volume of sulfur dioxide that could be emitted and forced the plants to own a permit for every ton of the stuff they spewed out. Each plant received permits, and if they were able to clean up their act and not use all the permits, they could sell them to bidders who needed them.

The sulfur dioxide cap and trade program worked like a charm. The polluters had two monetary incentives: reduce emissions as much as they could for the lowest cost.  Emissions came in about 20 percent below the cap required by The Clean Air Act, and the overall cost to plants was about one-third of the original estimate, according to the Environmental Defense Fund.

The system is still in effect today and permits for a ton of sulfur dioxide are still being sold on the market.

Now a huge debate and battle this summer is shaping up in Congress over how the U.S. can lead the world in reducing carbon emissions.

The big question is whether some sort of carbon cap and trade system can work in the same manner to cut the concentration of carbon emissions in earth's atmosphere.

The logistics of implementing a carbon cap and trade policy are much more complex that the sulfur dioxide plan which simply targeted coal fired plants. Basically, everyone in the U.S. leaves some sort of carbon footprint and contributes to the emissions problem.

Under a carbon cap and trade program, government would set a cap on how much overall carbon it believes can be safely emitted, then allow industry to purchase permits up to the safe threshold.

Companies who can quickly lower their emissions would sell permits to those who keep polluting while presumably working to lower their emissions before being priced out of the market.

Cap and trade is essentially a free market type of tax. A business that pays $500 for permits to emit carbon is basically paying a tax to release emissions. Cap and trade is not always predictable and it will lead to price increases in the marketplace. It differs from a straight tax in many ways, but perhaps most importantly in this one: The country will know exactly much carbon reduction it will get because government has set the cap.

If you believe climatologists who say the planet is dangerously near the “tipping point” where the amount of carbon in the atmosphere reaches a level of self-replication through feedback loops that will ultimately render Earth uninhabitable, setting the reduction cap is very important.

Those ready to tackle carbon emissions suspected of causing global warming, and those who are not, will be out in full force as Congress debates cap and trade solutions.

When this happens we could see a tipping point in the House and Senate that eventually determines the future of our planet.