Pictures from the Emissions Market

Emissions trading constitutes one part of carbon trading schemes such as those associated with the European Union Emissions Trading Scheme and the Kyoto Protocol.

Although emissions trading is advertised as an aid to the battle against climate instability, in fact it selects against immediate investment in the structural change required. Its short-term and uncertain price signals discourage long-term change and its cost-spreading among industries discourages innovation.

In addition, emissions trading cannot be implemented effectively on a global scale due to measurement problems and many other enforcement obstacles. Emissions trading creates and hands out property rights to the biggest polluters in the North, increasing their power and the inertia of a fossil-intensive system. Finally, emissions trading entails large and unaccounted stage-setting and opportunity costs.