Beware Emissions Trading, Airlines Stand to Make Billions

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The science journal Nature warns that a short-term effect of the European Commission‘s plan to include the airlines in the continent-wide market for greenhouse gas emissions will likely reap the industry billions, at least initially.

The world’s airlines, including many firms who have lobbied aggressively against climate-change legislation, could make billions of euros from a planned emissions-reduction scheme, say economists studying the situation.

The resulting rise in cost to individual airline tickets will be too small to deter customers, they add, so the reduction in greenhouse gas emissions will be miniscule —at least in the short term.

…The windfall is a consequence of the way emissions trading works. Industries in the scheme are allocated carbon dioxide permits that are traded in as emissions are generated. The permits can be sold if a firm emits less than its allowance, or bought if they wish to exceed it. Because industries are initially given almost enough permits to cover their usual amount of emissions, they should be able to continue business much as usual.

But experience with other industries already in the scheme shows that they treat permits as assets — the permits are currently worth around US$5 per tonne of carbon. To compensate for having to lose the assets when accounting for their emissions, the firms charge extra for products. In the case of the electricity sector, this is estimated to have generated an extra $1.5 billion in annual profits for British firms between 2005 and 2007.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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