Carbon trading is a concept we may or may not be familiar with. We may have heard of it, but not know what it is about and how it works to lower the carbons being emitted to our air.
How does the carbon emissions trading scheme work? A government basically figures out the amount carbon emissions are transmitted into the air by each industry. It then lowers the total percentage to meet their international responsibilities. Every company has to then meet the lowered target or pay a fine based on how much they have exceeded. When an industry reduces its emissions below the level, it can sell their unused amount to other industries who may need more carbon credits to avoid fees.
So how are these industries suddenly shrinking their emissions? How are these reduced emissions enough to observe the authorities' requirements and still be enough to allow them to sell to their contemporaries as carbon trades? You'd think if it is possible now, it is most likely possible then. The fact of the matter is, companies are more likely to be more sensitive to these issues when fines are involved.
There is 1 fatal blemish however-carbon trading can & most likely will affect the masses. Because companies might suffer from big fines coming from carbon trading, they can charge the consumers so they can still pay fines without affecting their profit. There is still room for improvement, of course, since carbon trading is still a new process not many are too familiar with.
The good thing about carbon trading however, is that even if it isn't a perfected process, it has helped the environment a lot already. According to the World Bank's Carbon Finance Unit, 374 million metric tonnes of carbon dioxide equivalent (tCO2e) were exchanged in projects in 2005. It shows a 240% increase comparative to 2004 (110 tCO2e) which was itself already a 41% increase relative to 2003 (78 tCO2e).
How does the carbon emissions trading scheme work? A government basically figures out the amount carbon emissions are transmitted into the air by each industry. It then lowers the total percentage to meet their international responsibilities. Every company has to then meet the lowered target or pay a fine based on how much they have exceeded. When an industry reduces its emissions below the level, it can sell their unused amount to other industries who may need more carbon credits to avoid fees.
So how are these industries suddenly shrinking their emissions? How are these reduced emissions enough to observe the authorities' requirements and still be enough to allow them to sell to their contemporaries as carbon trades? You'd think if it is possible now, it is most likely possible then. The fact of the matter is, companies are more likely to be more sensitive to these issues when fines are involved.
There is 1 fatal blemish however-carbon trading can & most likely will affect the masses. Because companies might suffer from big fines coming from carbon trading, they can charge the consumers so they can still pay fines without affecting their profit. There is still room for improvement, of course, since carbon trading is still a new process not many are too familiar with.
The good thing about carbon trading however, is that even if it isn't a perfected process, it has helped the environment a lot already. According to the World Bank's Carbon Finance Unit, 374 million metric tonnes of carbon dioxide equivalent (tCO2e) were exchanged in projects in 2005. It shows a 240% increase comparative to 2004 (110 tCO2e) which was itself already a 41% increase relative to 2003 (78 tCO2e).
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