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What are emission allowances? |
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The European Union has set a limit on the amount of greenhouse gases - of which carbon dioxide CO2 is one - that can be emitted from certain industries. The companies in these industries are issued emission allowances (credits, officially shortened to EUAs) which represent the right to emit 1 metric ton of carbon dioxide equivalent each. Companies that need to increase their emissions must buy allowances (credits) from those who pollute less.
The transfer of allowances is referred to as a trade. In effect, the buyer is paying a charge for polluting, while the seller is being rewarded for having reduced emissions by more than was needed. Thus, in theory, those who can easily reduce emissions most cheaply will do so, achieving the pollution reduction at the lowest possible cost to society.
There is more than one trading programme for greenhouse gases in the world, but the largest is the European Union Emission Trading Scheme (EU-ETS.
At Utsläppsrätt.se we sell emission allowances for carbon dioxide from the European Trading Scheme, in order for our customers to get carbon neutral.
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Last Updated on Monday, 31 May 2010 15:14 |