{
  "id": "RL30285",
  "type": "CRS Report",
  "typeId": "REPORTS",
  "number": "RL30285",
  "active": false,
  "source": "EveryCRSReport.com",
  "versions": [
    {
      "source": "EveryCRSReport.com",
      "id": 105431,
      "date": "1999-08-20",
      "retrieved": "2016-05-24T20:43:01.770941",
      "title": "Global Climate Change: Lowering Cost Estimates through Emissions Trading -- Some Dynamics and Pitfalls",
      "summary": "A major element in the debate about global climate change has been how to minimize costs by\nselecting the most economically efficient strategies to reduce greenhouse gases. With the negotiation\nof the Kyoto Protocol, international emissions trading has become a focal point of attention. Indeed,\nthe Administration believes that the goals of the Kyoto Protocol can not be achieved without effective\nemissions trading. International emissions trading is one of four \"flexibility mechanisms\" contained\nin the Kyoto Protocol (article 17).\n  A review of existing cost analyses of U.S. compliance with the Kyoto Protocol indicates\nconsensus that the potential for international emission trading to reduce U.S. compliance cost under\nthe Kyoto Protocol is substantial and indisputable. However, whether the potential for international\nemissions trading can be turned into fact is more problematic. This analysis suggests that\nimplementing international emissions trading under Kyoto would represent uncharted territory for\nU.S. environmental policy. \n  First, an international emissions trading scheme has to function very efficiently to achieve the\nsavings projected by analyses. For example, the Administration's analysis relies on an unprecedented\namount of international trading to achieve the substantial cost reduction it projects. Under its most\naggressive scenario, 82%-88% of the U.S. reduction requirement would be bought from foreign\nsources. The magnitude of transactions not only raises questions of its feasibility, but also may\nconflict with the intent of the Kyoto Protocol, which states that international emissions trading is to\nbe \"supplemental\" to domestic actions. \n  Second, besides the amount of trading estimated, the sources of these reductions raise additional\nquestions. For example, according to an analysis by Charles River Associates, half the estimated\nsavings from international emissions trading would come either from so-called \"hot air\" credits that\ncountries of the former Soviet Union have available because of their economic difficulties, or from\ntransactions with Third World countries that are not required to participate in the program. \n  Third, while the U.S. acid rain emissions trading program is cited as a model for international\ncarbon trading, in fact, unlike an international carbon trading program, the acid rain program does\nnot have to operate particularly efficiently to achieve substantial cost savings. The simplest trades --\nthose between a company's own plants -- achieve the greatest cost savings under the acid rain\nprogram. Thus, the U.S. acid rain emissions trading program provides little guidance to any future\ninternational carbon trading program.\n  The complexity presented by international emissions trading suggests that alternatives may\ndeserve a hearing.",
      "type": "CRS Report",
      "typeId": "REPORTS",
      "active": false,
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      "topics": []
    }
  ],
  "topics": [
    "Environmental Policy"
  ]
}