Summary
As per a feature by Eoin O'Carroll in the 16th March edition of Christian Science Monitor, he reports that David Cleary, the director of conservation planning for South America at The Nature Conservancy, has suggested using some carbon market revenues to support initiatives south of the American border. Current international policy, including the Kyoto Protocol, does not recognize the protection of forests as a source for carbon emission reductions. Developing nations cannot receive credits for reducing heat-trapping gases from one of their biggest sources: deforestation. Yet, if the Amazon goes, the climate shifts will hit the United States almost as hard as Brazil, Peru and the other Amazonian countries. Therefore a NAFTA for carbon trading would allow American companies to spend the revenues from carbon trade on deforestation and to include a provision in the U.S. carbon trading system that allows U.S. companies to gain carbon credit for offsets in Latin America?
Analysis
Under a cap-and-trade system, polluters buy permits, usually from government authorities, to compensate for their emissions. Such a system would raise hundreds of billions of dollars in an economy the size of the United States. So, what should governments do with that money?
President Barack Obama said in his recent budget proposal that any revenues raised in the United States (estimated at $646 billion between 2012 to 2019) should be used for alternative energy development — and tax breaks for some citizens.
This is unlike the Germans, who channel a small proportion of cap-and-trade revenues to development projects abroad. Besides, American companies should be able to meet some of their requirements to hold permits by generating credits from projects, based in South America, that seek to offset greenhouse gases.
Because deforestation produces as much as 20 percent of the world’s greenhouse gas emissions, forest conservation and restoration must play a meaningful role in any successful effort to avoid dangerous climate change.
Despite the fact that deforestation is the second leading contributor of carbon emissions worldwide after the burning of fossil fuels, countries currently have few incentives for preserving their forests. However, deforestation is finally gaining attention in international discussions on climate change.
Thus a NAFTA in Carbon trading would enable part of the revenue generated from the cap and trade system for projects aimed at of the forests of Amazon, the Andes and who else but America stands to benefit?
