Thread: Kyoto
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Old 07-27-2004, 12:09 PM   #7 (permalink)
Redlemon
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I'm not familiar with the 'clean credits' in the Kyoto protocol, but I am familiar with the 'emission credit trading' used in the US for acid rain and ozone, and I would assume that the method is similar.

First, a new emission standard is set, which is lower than the presently allowable emission level. If you can meet that level exactly, good for you. If you can beat that level, and are willing to take a permit restriction that permanently restricts you to that lower level, you can raise some $ by selling the credits. If you can't (include: is not cost effective) for you to meet the level, then you can buy credits to make up the difference.

The kicker is: there's a "tax" on the credits. The level of the tax differs depending on how bad the local pollution levels are, but it might be 1.1:1, or even 1.4:1 ratios.

Therefore, not only does the average emission levels between the two companies meet the limits, but an additional amount of emissions has been removed from the system.

Really, it works.
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