The California carbon rush..”no pain no gain”..welcome to the new world..hope you enjoy it

http://www.reuters.com/article/2011/02/17/us-california-carbon-idUSTRE71G3R220110217

Under California’s new carbon trading system, big polluters will be paying through the nose for the privilege.

And so will everyone else in the state.

The basic premise is “no pain, no gain” — when the price starts to pinch, that will spur innovation and California will lead the world in green technology. Or at least that’s the plan.

The Carbon Rush officially gets underway next year. Power plants, factories and other companies will have to obtain an “allowance” permit for every ton of carbon dioxide they produce. Allowances will be sold at state auctions and on an open market.

Most of the financial sting is being backloaded. The program begins with a big giveaway, with the state handing out most permits free — a “soft start,” is how state officials term it.

This new market will rapidly expand, beginning at just under $2 billion and rising to nearly $10 billion in 2016, according to estimates from Point Carbon, a Thomson Reuters company focusing on carbon markets.

The state is expected to reap billions of dollars in revenues, but the side-effects are hardly trifling. And it is only part of an array of programs to combat climate change. Cap and trade is guaranteed to push up gas prices for consumers and, critics say, some businesses may be driven away by the additional costs in an already high-cost state.

And that’s assuming it will work. The world’s biggest existing carbon market, the Emissions Trading Scheme in Europe, has been plagued by problems, from mispricing to theft, and provides no clear model for success.

Moreover, California has its own unique obstacles to overcome — not the least of which is that its companies are already greener than most.

The plan will have an impact that extends well beyond the state’s borders. If the carbon market can create jobs, cut emissions and operate efficiently, other states would be more likely to give it a whirl. If it flops, they won’t.

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california is the guinea pig..what was the worlds 4th biggest economy..do you think thats a prudent move?..it will fail like the same sytems have failed overseas..we dont have to have pain at all..

401

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~ by seeker401 on February 22, 2011.