Carbon trading system

The European Union has set up a carbon exchange system by which large users of carbon fuels can buy the right to emit carbon dioxide from those who have saved carbon emissions. So far this market operates only between large players: major industries. However, it seems to me that every operator of renewable energy should be able to receive the money from these credits. For example, every house with a solar water heater should be eligible for payments.

In this way the value of the non-carbon emitting energy can be recognised. Carbon credits would not be a Subsidy, but a legitimate business payment for an important service that the world as a whole needs. A National Association of Renewable Energy owners should be formed to negotiate these payments both via National governments and from the trading exchange itself. Householders and businesses would then have an incentive for installing the necessary apparatus. Photovoltaic users should also receive these credits, based on the number of kilowatt hours they produce. How the quantities are verified has to be decided. Some kind of inspectorate would be needed to make sure that the energy was actually being made and used. This would be paid for by the Carbon Credit Exchange.

When governments take climate change seriously the mass adoption of renewable energy will certainly be one of the strategies to be used. In the tropical areas a combination of biogas, photovoltaics and hydro power will probably become the main alternatives to the fossil fuels. All these should receive payment from the carbon credit exchange - what will become in effect a tax on carbon emissions (whatever form of words is used). At the point where the use of oil and coal is declining the carbon credit payments will diminish and all these carbon-free energy sources will stand on their own feet because by then the price of energy will be set mainly by the renewable sector.

The purpose of the Union is to negotiate with government and industry to receive a share of Carbon Credit money from the Carbon Exchange system. It will operate in an analagous manner to the Performing Rights Society.

So far the Carbon Exchange system operates only between large emitters of carbon dioxide and large producers of renewable energy. But it is in the interest of us all that there should be millions of small installations. The object of the Union is to make sure that the small producer can sell the avoided carbon on the Exchange. The Union will:

1. Negotiate the rates to be received (sell the credits in the market)

2. Register the producers.

3. Inspect the producers to check that the energy is being produced.

4. Collect the credit payments in bulk.

5. Distribute the carbon credits to individual producers.

Installations that need to be represented:

1. Solar water heaters

2. Photovoltaic producers

3. Stirling Engine gas heaters/electric generators and other Combined Heat and Power.

4. Small Wind generators.

5. Fuel cell generators

6. Small hydroelectric generators

7. Biomass (such as biogas or farmed woodland)

At this stage it is not possible to say how much each owner should receive, but even if it is no more than 10 pounds/14 euros per year this scheme would be worth having.