carbon credits for forest preservation

[keannu]

Source : 2019. Korean College Entrance exam, 23

We argue that the ethical principles of justice provide an essential foundation for policies to protect unborn generations and the poorest countries from climate change. Related issues arise in connection with current and persistently inadequate aid for these nations, in the face of growing threats to agriculture and water supply, and the rules of international trade that mainly benefit rich countries. Increasing aid for the world’s poorest peoples can be an essential part of effective mitigation. With 20 percent of carbon emissions from (mostly tropical) deforestation, carbon credits for forest preservation would combine aid to poorer countries with one of the most cost-effective forms of abatement. Perhaps the most cost-effective but politically complicated policy reform would be the removal of several hundred billions of dollars of direct annual subsidies from the two biggest recipients in the OECD―destructive industrial agriculture and fossil fuels. Even a small amount of this money would accelerate the already rapid rate of technical progress and investment in renewable energy in many areas, as well as encourage the essential switch to conservation agriculture.

I don't understand the underlined, what does it mean?

 

[SoothingDave]

Which part don't you understand? The idea is to pay poor countries to not cut down their forests. This so more developed countries can continue to have advanced economies. Rather than having strict government mandates, they instead set up a system where companies that "pollute" CO2 need to buy "credits" on a market. The cost to buy these would then be essentially a tax which is paid to poor countries to not develop their own natural resources. This is supposedly more cost effective than simply having governments limit the use of energy in their own economies.

 

[keannu]

Which part don't you understand? The idea is to pay poor countries to not cut down their forests. This so more developed countries can continue to have advanced economies. Rather than having strict government mandates, they instead set up a system where companies that "pollute" CO2 need to buy "credits" on a market. The cost to buy these would then be essentially a tax which is paid to poor countries to not develop their own natural resources. This is supposedly more cost effective than simply having governments limit the use of energy in their own economies.

Thanks a lot. But what exactly is "carbon credit"? Is it like a penalty fee for cutting forest or emitting carbon?

 

[SoothingDave]

It's a thing you have to buy if you operate a business that "pollutes." Imagine a stock market, but instead of people buying and selling pieces of a company, they are selling the "right" to "pollute." People with trees can sell the right and people who run businesses can buy the right.

If you operate a business and don't purchase enough credits to cover the "pollution" you cause during a year, then the government would come in with harsh penalties.

The government will also limit the amount of credits available to buy as the years go on, forcing businesses to "pollute" less until we finally have a utopia where there is no "pollution."

 

[GoesStation]

Thanks a lot. But what exactly is "carbon credit"? Is it like a penalty fee for cutting forest or emitting carbon?

A carbon credit is essentially a permit to emit a certain amount of carbon dioxide. Countries can sell credits instead of releasing CO2; those countries that wish to emit more than their allotment can buy credits from other countries. Tradable credits have proven to be a very efficient way to limit emissions of sulfur dioxide (SO2) and nitrogen oxides (NOx) in North America. This system controlled the acid rain problem that was devastating eastern North American forests. It's hoped that a similar program can stop the increase in CO2 emissions that drives global warming.

 

[Tarheel]

Keannu, penalty fee is the same as penalty.

That piece starts off with "We argue" which should tell you something.

 

[keannu]

Which part don't you understand? The idea is to pay poor countries to not cut down their forests. This so more developed countries can continue to have advanced economies. Rather than having strict government mandates, they instead set up a system where companies that "pollute" CO2 need to buy "credits" on a market. The cost to buy these would then be essentially a tax which is paid to poor countries to not develop their own natural resources. This is supposedly more cost effective than simply having governments limit the use of energy in their own economies.

1.Do companies of developed countries buy carbon credit and pay it to poor countries?
Is it an incentive to encourage poor countries not to do deforestation? Is carbon credit to discourage deforestation? Then don't poor countries with forests have to pay carbon credit?

2.How is the money related to these?
destructive industrial agriculture and fossil fuels.

 

[SoothingDave]

1. Yes, more or less. Emitters of CO2 would need to buy credits from absorbers of CO2. Forests absorb CO2 (because it is plant food), so the idea is to encourage forested areas to remain forested. I am not sure why you think a country with undeveloped forests would have to pay. They would receive.

2. The idea is to make fossil fuels and "industrial agriculture" prohibitively expensive. By requiring these activities to buy carbon credits, and then progressively making the credits more and more expensive. The idea is that we will arrive at a utopia where we get all of our energy from natural sources and all of our food from local small-scale producers.