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US proposal envisions wider carbon cap and trade schemes for states

05 Dec 2012 19:30:53 | edcm

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The US is looking at a new proposal that could introduce more cap-and-trade systems across the country and cut its carbon emissions by almost a third.

The Natural Resources Defense Council (NRDC) presented the proposal on Tuesday as it looks at introducing sweeping changes to green the country's energy sector.

Under the proposal, the Environmental Protection Agency (EPA) would use the Clean Air Act to "set state-specific carbon emission rates" that differ depending on the "diversity of the nation's electricity sector and fuel mix", according to an NRDC statement.

Utilities will be able to cut emissions in line with the rates by using cleaner technology or fuels and by avoiding emissions to earn"credits" that generators could buy or use towards targets in other states.

The proposal also notes that states would be free to introduce an actual cap-and-trade system similar to that launched in California this year "as long as they are equally effective in cutting emissions". California's first auction of greenhouse-gas allowances for delivery next year took place last month (see EDCM 20 November 2012).

The proposal aims to cut power plants' emissions, accounting for up to 40% of the country's carbon footprint, by reducing existing power-plant emissions by 26% by 2020 and 34% by 2020 and incentives for investments of around $90bn (€79bn) in clean and efficient energy projects.

NRDC's director of climate and clean air programs, Dan Lashof, said: "We show that the [EPA] can work with states and power companies to make large pollution reductions, by setting system-wide standards... and by giving power companies and states the freedom to choose the most cost-saving means of compliance."

The US is the world's second largest emitter of CO2, topped only by China. MLDB

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