Cap & Trade Cut Emissions 50% in 20 years

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It’s official. The Acid Rain Cap and Trade program worked. The EPA has just released its report. Electric utilities in the US are already below the 2010 emission cap of 8.95 million tons of sulfur dioxide SOx and nitrogen oxides NOx.


The Acid Rain Program established under the 1990 Clean Air Act Amendments required major emission reductions of  SO2 and NOx, using Cap and Trade.

Lessons learned provide the evidence that Cap and Trade:

  • Offers an alternative to traditional regulation and credit trading
  • Provides greater environmental certainty that a specific emission level is achieved and maintained
  • Provides greater regulatory certainty, compliance flexibility, and lower permitting and transaction costs for sources
  • Requires fewer administrative resources from industry and government—if program is kept simple
  • Creates incentives for innovation, early reductions, and high compliance
  • Can be compatible with other mechanisms—source-specific requirements, taxes, voluntary measures
  • Drives costs down below direct control approaches, making more air emissions reductions attainable

Every one of the 3,572 electric generating units subject to the program’s SO2 requirements held enough allowances to cover their SO2 emissions, resulting in 100 percent compliance last year. The program set a permanent cap on the total amount of SO2 that may be emitted in the United States by power plants, and included provisions for trading and banking allowances.

Air quality got better and rivers in the Northeast recovered from acidification.

Image: Desert Vu

Source: EPA report

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