Good news for the future of cap and trade — and our climate — from a couple researchers at Stanford Graduate School of Business. Carbon capture and sequestration (CCS) probably won’t cost as much as previously thought, which will keep the overall price of carbon credits lower because the carbon dioxide emitted from coal power plants is such a large portion of overall emissions.
In essence, cheaper CCS will produce a greater volume of carbon credits, thereby dropping the price of the credits supply-and-demand-style.
Hopefully this reevaluation of the costs of capping carbon emissions will give a helping hand to cap and trade regulations that have yet to reach the Senate floor.
Excerpt:
STANFORD GRADUATE SCHOOL OF BUSINESS — There’s good news for supporters of the Waxman-Markey climate bill from Professor Stefan Reichelstein. Although passed by the U.S. House of Representatives in June 2009, the bill is expected to spur a contentious debate in the Senate starting this fall. Opponents argue that the bill’s proposed “cap-and-trade” system will take a high financial toll on energy consumers and companies alike, and devastate the economy at a time the country can least afford it.
Reichelstein and doctoral student Ozge Islegen believe they have evidence to the contrary. Reichelstein and Islegen have examined the financial impact of regulating coal-fired power plants that produce carbon dioxide emissions under a cap-and-trade system and found the financial burden to be much less than previously projected.
via Reducing CO2 Emissions Could Be Significantly Less Costly Than Predicted.
