UK launches world's first government sponsored emissions trading programme
WORLD's first government-backed national emissions trading programme has been launched by the uk as part of its efforts to bring down the emissions of greenhouse gases (GHGs). As per the provisions of the programme, financial incentives would be given to industries for bringing down their ghg emissions. "The programme, starting from April 2002, would be backed by a us $305.3 million government incentive spread over five years," said Michael Meacher, the country's environment minister. The incentives would be allocated from next year by auction, with firms bidding on the basis of the level of reduction they believe they can achieve. Companies would themselves set targets. Those meeting their goals would be given cash incentives while those failing to comply would be penalised, including taking back their incentives along with an interest and a reduction in the following year's allowances. Electricity generators, one of the biggest polluters, are not eligible to join the scheme as the government wants to tackle energy users rather than the producers.
"The scheme would help us in achieving the Kyoto targets. It has been introduced to avoid imposing additional mandatory burden on the industry. Moreover, which company would decrease its emissions without being given incentives?" remarked Meacher. According to him, the scheme would help in accomplishing 10 per cent of the Kyoto reductions. Under the Kyoto Protocol, on the basis of its 1990 emission levels, uk has pledged to reduce the emissions of six ghgs by 12.5 per cent till 2012. "Such schemes would be launched by many countries by 2008. Our programme would be a model for them," he claimed.
The programme has been hailed by the industry. Digby Jones, director general of the Confederation of British Industry, said that it is "good news for business and the environment". Charles Nicholson, chairperson of the Emissions Trading Group, said that emissions would be eventually traded like any other commodity.
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