Carbon credits spark debate
31st January 2007 by Tim Kitchin
A constructive debate is raging over at David Miliband’s blog around the likely effectiveness of consumer carbon credits.
Three sets of objections are playing out:
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They disproportionately penalise the poor
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They are technically too complex and potentially unworkable
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The government does not have the competency to administer and police the scheme.
Underlying these arguments is a wider anxiety that markets just don’t work to manage externalities. Government must legislate on the supply-side if it needs to fix this.
The government’s view remains more nuanced. It recognises the power of markets to connect decision-making, but also the need for intevention.
The recent gold standard for carbon offset schemes is a good example.
Legislation can set a framework for markets to work, but ultimately independent business assurance approaches are needed to ensure that intended outcomes actually materialise, and trust is sustained.