The “cap” of cap and trade involves setting a limit to the total emissions of a given entity, whether it’s a state, a country, or a planet. The general idea is that the cap lowers over time, mandating emissions decreases. The Waxman-Markey bill lays out the cap for reducing GHG emissions in the US as such:
“[The] Safe Climate Act – Amends the [Clean Air Act] to require the Administrator [of the EPA, in this case Lisa Jackson] to promulgate regulations to: (1) cap and reduce GHG emissions, annually, so that GHG emissions from capped sources are reduced to 97% of 2005 levels by 2012, 83% by 2020, 58% by 2030, and 17% by 2050; and (2) establish a federal GHG registry.”
Since these reduction goals use 2005 as a baseline, it’s worth looking into our emissions trends over time. Based on the most recent GHG inventory available on the EPA’s website, our emissions in 2005 totaled 7108.6 teragrams (1 Tg = 1 million metric tons) of CO2 equivalent*. That’s about 16.5% above our 1990 emissions, so emissions have been rising at a rate of about 1.1% per year.
If that rate of increase were to continue until 2012, our emissions would be 4.6% above the 2005 levels. So the 2012 goal of reducing emissions to 97% of 2005 levels means that we’d have to both eliminate that rise AND cut out an additional 3%. All in all, it would amount to a 7.6% reduction in just 3 years, assuming that the legislation passes this year. That’d be huge.
Whether the ~1% increase/year will hold steady is an open question. Changes in emissions have generally been tied to economic growth or contraction. In 2008, corresponding to the onset of the current financial crisis last year, emissions decreased 2.8% compared to 2007 values. The decrease was driven by high gas prices and the financial crisis rather than increases in efficiency or the use of renewable energy.
*Some GHGs are more potent than others in terms of their ability to warm the planet. The “equivalent” takes into account the global warming potential of other GHGs, such as methane, and references that potential to CO2’s global warming potential.
