'Cap-and-trade' model eyed for cutting greenhouse gases

[XemaSab]

In the 1980s, Washington policymakers faced an intractable problem: Acid rain, fueled by pollutants from coal-fired power plants, was ravaging lakes, streams and forests and endangering wildlife, especially in the Northeast. President Ronald Reagan, siding with the coal industry and utilities, chose to study the problem. But when George H.W. Bush was elected president, he embraced a novel approach. He would allow power plant operators to buy, sell and trade credits to pollute - as long as they cut overall emissions in half.

"We will allow flexibility in how industry achieves these goals," Bush told lawmakers and business leaders gathered at the White House on June 12, 1989. "But we stand firm on what must be achieved."

Nearly two decades later, the acid rain program the Republican president crafted with a Democratic Congress - and over the opposition of many environmental groups - has emerged as the model for efforts to fight global warming worldwide. Europe's carbon trading market is based on it. California and other states are crafting their climate change rules on the same principles. U.S. senators are scheduled to vote in committee this week on a climate bill inspired by it.

Even opponents of the original measure, tucked into the 1990 Clean Air Act, now agree it's been a success. It has cut the emissions of sulfur dioxide by 40 percent from 1990 levels. By 2010, the Environmental Protection Agency estimates that complying with the law will cost utilities and consumers about $1 billion to $2 billion a year - about a quarter of what was originally forecast.

http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2007/12/03/MNMMTJUS1.DTL