Popular Posts

Friday, May 06, 2011

A DIRTY LITTLE (GREEN) SECRET

THE KYOTO ENVIRONMENTAL PROTOCOL IS DEAD !  Last year's eco-pow wow in Copenhagen emitted nothing but hot air. And, the carbon credits markets, aka: cap and trade, are being recycled into much smaller and much less potent entities.  But Why?  Why has one of the most high-minded and noble aspirations of the green movement gone brown?

The answer is Russia.  Russia?  What, you ask, does Russia have to do with the demise of global cap and trade?  Well, it's like this.

Russia's greenhouse emissions plunged with the collapse of the USSR in 1991. Throughout the 1990s, all across Russia huge polluting factories were shuttered to the extent that by the turn of the century Russia's carbon emissions were down by 35% resulting in their amassing almost $1 trillion worth of energy credits.  Now, Moscow wants to cash those credits in before there can be a global agreement on emissions going forward.  This issue was the skunk at the Copenhagen eco-garden partyAnd, it will be taken up in Mexico City, which will host the next global eco-lovefest.

Naturally, the two most polluting countries (the U.S and China) would bear the brunt of the trillion dollar payment to Russia, which is a real agreement non-starter.  The carbon credits held by Russia are due to expire in 2012 (along with the Kyoto Treaty) however, Moscow wants the credits to roll forward if  Russia (the world's third worst polluter) is to sign any carbon emissions' agreement.  Russia asserts that the credits are legitimate claims and this assertion has been supported by most international law scholars, green community honchos, and all of the other Kyoto signatories.

As it now stands, Russia has 5-6 gigatons of emission credits to sell  -equivalent to China's total emissions for one year - and they are not the only one.  The Ukraine also has a huge number of credits and is waiting to see what deal Moscow strikes before it seeks its own deal.

Obviously there is a lot of disagreement within the global eco-community as to how this problem will be settled and putting a value on Russia's $1 trillion claim.  Moscow wants full payment while the U.S. and China want the credits to expire worthless.  

And the beat goes on!

Best
Jim Lavorato

No comments:

Post a Comment