Cap-and-trade could be the best tool to reduce greenhouse gas emissions to help conquer global climate change. It also could promote industrial innovation and help clean up the environment in Lee County and nationwide.
Here in Lee County, the Board of County Commissioners is looking to breathe new life into Lee County's business community by encouraging cap-and-trade programs that will promote new green businesses and ideas.
Lee County businesses already are working on alternative energy (solar) and fuels (cooking oil and jatropha for county vehicles), and a few consultants are looking to greener transportation issues and solutions, such as the one-way tolling system in Cape Coral, which helps to reduce car emissions. But we can do more. Cap-and-trade could be one of the solutions to turn around Lee County's economy.
Here's how it works: a cap-and-trade system sets a "cap" - or limit - on industry emissions and distributes "rights" to emit greenhouse gases, called allowances. Industries are regulated up to the level of the cap.
If a company reduces its emissions below its cap, it can receive pollution credits it can sell, "trade," or transfer to other firms which are unable to meet the cap requirements.
Companies do not have individual caps, and must ensure that they acquire a sufficient quantity of allowances to cover its emissions in any given compliance period. Allowances and reductions are kept under the cap. The cap is condensed over time, further reducing overall greenhouse gas emissions and helping the environment, and the goal is to slow global warming.
Cap-and-trade has recently emerged as a tool for addressing greenhouse gas (GHG) emissions, (nearly every bill proposed in the US Congress today relies on a cap-and-trade system as the core policy to reduce carbon emissions) but it also has a successful financial and environmental history. The most well-known cap-and-trade success story in the U.S is acid rain. In the early '90s, high levels of sulphur dioxide emissions resulted in sulphur deposition, or acid rain, in the eastern United States. Title IV of the Clean Air Act established a cap-and-trade program in 1995 to reduce these emissions. The program was successful in achieving the targeted emission level, with 100 percent compliance of regulated entities, and achieved reductions at a cost that was far lower than projected. From an environmental perspective, cost savings enabled many firms to reduce emissions more quickly than required by law. These emission reductions were obtained despite the dramatic growth in electricity demand.
President Barack Obama is calling for an 80 percent reduction in greenhouse gasses and Congress is moving fast with cap-and-trade legislation with the same ambitious goals. Environmentally, significant long-term reductions in greenhouse gas emissions must take place.
Technological breakthroughs to meet this challenge will need to come from many areas - renewable energy, energy efficiency, energy storage technology, new fuels, and more. Because a cap-and-trade system is not technology specific, it can encourage and accommodate any emerging GHG control technologies or practices and can provide an important incentive for development of these new technologies. This provides business opportunities both for Lee County's small business startups and large firms.
Some politicians, industry leaders and utility naysayers claim that every tax dollar applied to a ton of carbon dioxide would mean a 1 percent increase in energy rates. For example, a manufacturer that uses $1 million in energy a year could face an increase in energy costs of $280,000 to $840,000 a year, which is why some industry titans are fighting the changes. The same anti-cap-and-trade groups also say that those costs would be passed down to customers.
However, federal assistance money will offset these costs by moving innovative projects forward and helping to offset initial cost increases. It also will provide needed jobs right away while providing for the future environmental integrity of the planet. Cap-and-trade has proven in the past that it works for the environment and the economy; let's get fired up about this and see it as an opportunity. And I'd like to see innovative ideas from local businesses (such as the recently approved endeavor to turn jatropha plant oil into fuel for county vehicles) come before the BoCC. Lee County needs the business and the work. Let's meet the challenge for the economy and the environment.
- Bob Jones represents District 1 on the Lee County Commission