With much focus in the US on a carbon cap and trade system to reduce greenhouse gases, I spoke with Kevin Smith of Carbon Trade Watch, a project of the Transnational Institute, and author of "The Carbon Neutral Myth - Offset Indulgences for your Climate Sins" and Jutta Kill of Sinkswatch to find out why they are going around the world speaking to audiences about the failures of carbon trading and offsets.
Leslie Berliant: I understand that you are going on a speaking tour to talk about the problems with carbon trading and forest offsets, who is your audience?
Kevin Smith: Our audience is basically very wide ranging. It is anyone who feels that they’re involved in the public discussion on climate change, going on particularly in the States at the moment, and what the policy response is going to be and what America is going to do about the climate crisis. It seems that there is a big discussion that is taking place focusing on what should happen and what the response should be. We have been monitoring the EU carbon trading scheme and how it is failing to reduce emissions and we’ve done a lot of field research on the impact of offset projects on Southern communities, helping to shine a more critical light on what is going on with those projects instead of the glossy coverage you get from the companies themselves. People may have been hearing a lot from lobby groups like the US Climate Action Partnership how wonderful carbon trading is, but we have a very different story to tell.
LB: How did the idea of carbon trading first come about?
Kevin Smith, Carbon Trade Watch |
LB: What is the problem with carbon trading?
KS: There are so many different problems. One of the big problems is that all of the evidence we have from the EU scheme is that the polluter profits instead of pays. A newspaper report in the UK just this last week suggests that the energy sector is going to profit by £6 billion as a result of the second round of the EU trading scheme which began in 2008. The big energy companies have profited by billions of pounds from having over generous permits given to them. You are actually rewarding the biggest polluters and providing opportunities for them to not make any changes while making profits. Another one of the problems is that the system of carbon trading represents the privatization of the earth’s carbon cycling capacity. There has been virtually no debate on whether people want this. It’s something that has happened as a fait accompli. It’s a system in which those rights have been allocated without any sort of democratic process as to who should get those rights and what they should do with them.
It gets complicated. We have both a voluntary and regulated carbon market. Both, however, represent a new form of colonialism in southern markets. Carbon colonialism is about treating the supposed low cost emissions reductions in Southern countries as a new commodity that can be profitably exploited for the benefit of Northern consumers and companies. What we are also seeing, and Jutta can say more about what is happening in these Southern countries, is that often these projects have a harmful impact on local communities. This fact has been brushed under the carpet so people can keep doing it. We hear very little about these communities and what is happening on the ground, we only hear the positive side. Our experience is that people on the ground are having a very rough time with these projects.
LB: What is the problem with forest offsets?
Jutta Kill, Sinkswatch |
LB: What about carbon offsetting, is it ever a good idea? Take something like travel for example.
Is saving the environment this simple? |
KS: Oliver Rackham, a Cambridge University botanist and landscape historian, says that telling people to plant trees [to solve climate change] is like telling them to drink more water to keep down rising sea levels. Through personal offsets, companies are commoditizing peoples desire to do something about climate change. They are taking people's impetus to do something real and reducing it to a mouse click -- another act of consumerism. This is a real distraction from political and community-based organizing that has to happen to create the necessary change in the face of the climate crisis. Offsets are also putting all the focus on individual consumption and lifestyles. There needs to be a more sophisticated analysis than just changing light bulbs and driving more efficient cars. Light bulbs and other lifestyle factors play an important part, but are by no means the whole story as offset companies would have you believe.
JK: That is an important point. Carbon offsets personalize responsibility for climate change. At the same time, they marginalize the need for systemic change and the need for governments to give us a different set of choices. Carbon offsets say ‘I don’t need other choices as long as I pay my dues’. They will delay the building up of public pressure that we need for politicians to make sensible changes necessary to get us onto a different energy system. Carbon offsets also delay the public pressure for larger changes in the way we use and produce energy.
KS: In the States, carbon offsetting has been used to swing and influence the way investments are being made. For example, there is a proposed coal power station in Texas right now. Local activists groups have dropped their opposition because the company said it will offset their emissions, but it still locks us into that coal powered plant for decades.
LB: People and corporations are going to put out carbon, what is the solution for trying to reduce it or minimize its impact if not a cap and trade or offset system?
JK: There’s a whole long list of other ways. One is looking at how we reduce energy at an individual, company and government level. More importantly, there is a need for government action and for governments to stop subsidizing fossil fuels and support energy that is clean and just. There is lots of talk about clean coal, for example, until you talk to the people who live around mountain top removal sites who will tell you that there is no such thing as clean coal. We need to push those changes and the understanding that we need a different way of getting our energy. It will start with organizing locally and talking to politicians, as well as action in local groups. For example, there is a transitional towns movement where people in these local areas talk about what it will mean to increase self reliance from energy, transport and food perspectives. We need that kind of action. Sitting behind our desks and writing checks is not going to bring about the kind of change we need. There is a need for a massive public investment program into the right types of appropriate technology, too. There has been a lot of focus on putting a price on carbon and less focus on how we can make alternative energy affordable for people. When we look at large technology projects, they have always come about through massive public investment. The challenge is to do it in a way that benefits communities and not just the large oil companies and energy companies. Carbon trading will not provide that level of change and will not provide the targeted development needed.
KS: One of the reasons why so much emphasis has been put on offsets and carbon trading is not because of the track record in reducing emissions this way, because they have no proven track record in this, but because of the compatibility with the current economic system which is very market oriented and fixated on year upon year growth. We need to address this growth-fixation and its corresponding growth in fossil fuel consumption in order to deal with climate change. There needs to be some movement toward extracting ourselves from the current economic system as it stands.
LB: What is your opinion on projects that allow you to pay a premium on energy in order to put more wind or solar into the grid?
JK: It can be a useful component in providing incentives for renewable energy. In Germany, the energy utilities have to buy up all of the renewable energy available, but it gets passed on to consumers in the price. The law requires that utilities have to buy up all the energy from renewable energy at a predetermined price so it provides some certainty for renewable energy providers. This has meant that lots of renewable development has been to the benefit of small scale businesses rather than large corporations with legislation providing some long term certainty as to a set price. Farmers are putting up photovoltaic equipment on their farms and helping increase the amount of renewable energy in the grid. At the same time, this has meant that the technology has become more affordable so that small scale businesses can be involved. Individual energy users paying for green energy is okay if they are part of an overall set of policies that ensure that fossil energy production is decreased, otherwise it makes electricity more expensive while not making any changes.
At the same time, Germany is still building some of the dirtiest coal powered plants, so it is also a model for how not to do things. As long as they are building coal plants, it undermines sensible legislation. Much of power generation must be renewed over the next 10 to 15 years, so our politicians will decide what our energy infrastructure will be for the next half century because once you build a coal plant, you will run it. So it is crucial that structural changes must happen now before big investments are made in dirty coal.
LB: What role, if any, should corporations play in addressing global warming?
JK: It depends on which corporations and whether they understand that their relations with energy need to change fundamentally. I believe an oil or coal company that has no track record but claims to be green does not have a role to play. Their role should be to phase out fossil fuels and stop fighting that phase out. For example, in Germany, car companies are fighting to not have to build more efficient cars. Their role is to develop technology and engineering to solve the problem. And the use of technology needs to go hand in hand with a timeline and education.
KS: The level of corporate power and influence is an enormous part of the problem. The reason that we have such a toothless Kyoto protocol is largely due to corporate lobbing that has watered it down to the state it is today. The nature of corporate influence over political processes and environmental treaties has to be addressed. What we are seeing with trading is that we are giving the opportunity to evade taking action and to make a profit to the institutions that are most responsible for emissions in the first place.
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