Can emissions trading save us?

3 min read

What is emissions trading? Source Emissions trading, also known as cap and trade, has two components. First a cap is set on total emissions for the participating firms. Each firm is allowed a certain amount of emissions, or allowances. The second component is the trading. When a company has leftover allowances, they can trade them to another company. Firms may identify offsets, where efforts are being made to reduce emissions, and invest in those. Offsets can be traded for allowances. The good parts Many ex ante analyses have found that emission trading achieves similar reductions to more traditional regulation policies…...

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Srihita Mediboina I’m currently a senior at Stony Brook University focusing on economic policy and data analysis.