Environmental Engineering Reference
In-Depth Information
To achieve this legally binding target, the countries listed in Annex I can
apply a fl exible mechanism: the 'joint implementation mechanism' (whereby
an industrial nation funds projects to cut greenhouse gas emissions, generally
in a transition economy), the 'clean development mechanism' (an industrial
nation funds emission reduction projects in a developing country), or 'inter-
national emissions trading' (an industrial nation that has exceeded its emission
limit buys emission credits from another industrial country that has emission
credits to spare). An industrial nation receives emission reductions from joint
implementation projects and clean development mechanism projects which it
can apply towards the fulfi lment of its own obligation, or it can buy emission
credits from another industrial country. The idea is that acquiring emission
credits in industrial nations costs so much more than in transition economies
or developing countries that it makes fi nancial sense for an industrial country
to get the credits where it is least expensive - or in some cases to buy emission
credits from other countries in order to meet its obligations.
Another new trend is the creation of market-based mechanisms based on
the same basic idea as in emissions trading in the climate regime: emissions
must have a price. In this way, an ecosystem service that everyone uses freely
is limited by legal regulation and a market is created.
Many companies barely gave consideration to climate change previously - 'the
emissions disperse in thin air'. Now they must change their policies, since limits
have been set on the greenhouse gas emissions of, for example, every EU
member state. These emission permits are divided by member states internally
between those companies accountable for the emissions. Unless they are able to
manufacture their products within their own emission quotas, they have to buy
permits from other companies that have used fewer permits.
From 2013, the EU has introduced two emissions caps. The emissions trading
segment has an EU-wide cap and the national caps and national distribution plans
are removed, whereas the segments outside emissions trading (transport, waste
management, agriculture, for example) retain the national caps. The EU is gradu-
ally moving from distribution plans based on national emission caps to a system
of an EU-wide cap where emissions permits are sold to companies by auction.
The same logic applies to ecosystem services.
The salinity of the Hunter river in New South Wales, Australia, is contained by
dividing the amount of water in the river theoretically into 365 blocks outside
the fl ood season (when water is low). Each plant along the river is granted emis-
sion credits for a certain amount of waste water in a certain block; if a plant runs
out of credits, it can buy more in the online trading system maintained by the
state environmental protection authority. The system seems to have functioned
well. The condition of the river has improved as emissions are matched with
the capacity of the river at each time. The environmental quality has improved
without the need to limit the total amount of emissions.
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