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Last Updated: Tuesday, 29 November 2005, 11:38 GMT
CO2: This time it's personal
By Richard Black
Environment Correspondent, BBC News website

Imaginary carbon card.  Image: BBC
It's a carbon reward card, a climate reward card
Colin Challen MP
So you've filled your tank with petrol, wiped the bugs off your windscreen, and you're standing in the queue holding two pieces of plastic which will finalise the purchase.

One card carries the logo of your bank; the other, a picture of a burning planet.

The first will deduct money from your bank account; the second, credits from your carbon account.

You cough up your money and your credits, get back to the car and on your way; your tank is filled, and, what's more, the planet saved from the uncertain fallout of man-made global warming.

Warm welcome

If you possess the second card, you are now living in DTQ world; not the vision of some semi-adolescent computer game designers, but a sober academic theory which is now attracting the interest of politicians desperate to find new, effective ways of curtailing greenhouse gas emissions.

"In this system, individuals are literally stakeholders in the atmosphere," Richard Starkey told MPs and other interested parties in the UK's parliament last week.

"One could get [people to] buy-in to the process of emissions reduction and even generate a sense of common purpose."

For the last two years, Mr Starkey has been working on DTQs - Domestic Tradable Quotas - at the Tyndall Centre for Climate Change Research.

He has been honing the concept which writer David Fleming invented nine years ago and pinning down details of how a scheme could work in the UK.

He will be publishing his conclusions in December.

Permits to pollute

Domestic Tradable Quotas are in effect personal allowances to pollute.

In Europe, about 12,000 big companies and institutions already have such allowances, regulated by the EU's Emissions Trading Scheme (ETS).

Pollution has become a commodity with a price determined by the market, which will ensure that emissions are cut in as cost-effective a manner as possible.

DTQs would simply extend this concept to the public.

You can't make commitments internationally and then have no idea how to meet them
David Fleming
"To make the substantial cuts in emissions we are going to have to make, there are only two ways to do it - taxation or rationing," David Fleming told me.

"A carbon tax is a very bad idea because we know it's going to have an effect on the economy.

"Also, anything that we do on climate is also involved with energy, and the idea of taxing oil when supplies are already depleted is a ridiculous idea."

Which leaves rationing; another, perhaps less palatable term, for DTQs.

Benidorm bonanza

Richard Starkey's DTQ scheme would entail each citizen receiving - free of charge - an identical personal carbon allowance.

If you use less, you can sell your extra allowance onto the open market, while if you want to splurge out on that once-in-a-lifetime flight to Benidorm, you can save it up or buy extra.

The more people exceed their allowance, the more expensive it would become to buy extra; and pretty much all goods and services with a "carbon cost" would need some carbon expenditure.

Graph showing stepwise decrease of emissions.  Image: BBC
Each year the national and personal allowance goes down
Credits and debits could be made online, by phone or using a little piece of plastic; the monthly mailbag could include "carbon statements" as well as bank statements.

"This is in effect a carbon reward card," said Colin Challen MP, who set up the Westminster meeting in his role of chair of the all-party parliamentary group on climate change.

"Or, if you like, it's a climate reward card. It enables people to watch the units they use during the year."

So far, so straightforward; but how, exactly, would it reduce emissions?

Every year, the national allowance would be reduced towards a long-term target level; that would in turn reduce the personal allowance, and over time, emissions would fall.

And it would not necessarily be limited to the UK. There is no reason in principle why, in the longer term, allowances could not be traded within Europe or perhaps further afield.

Black economy

As an example of how it could work, let us dive for a moment into the Black family's carbon budget.

We are good on transport: I cycle most places, and generally take public transport at other times, reserving the luxury of the car for long-distance trips to see relatives. Children go to school by bus or on foot.

But I still bought the car in the first place. If that purchase cost me some of my carbon allowance - still more if I needed to buy extra on the open market, raising the price - would I still buy it?

Might I not choose instead to join a carpool scheme - and if I did, would our casual car use go down still further? I think it would.

On energy efficiency, our family is, frankly, terrible; lights are left on, electronic equipment on standby. There is a financial penalty, of course; but obviously not enough to force behaviour change.

"Domestically, we waste about 5bn worth of energy each year," commented Colin Challen.

Again, a carbon card might - though sloth is a powerful enemy - force us to confront our wasteful ways, by making all those tonnes of carbon dioxide immediately visible.

If not, allowances gained on the bike would be lost on the electricity supply.

Costly and cumbersome?

If personal carbon-saving incentives are to be stepped up, the question is whether DTQs are the best way.

Would they prove too expensive or cumbersome to administer? Would there not be lots of special pleading for extra allowances or exemptions?

"It wouldn't be as expensive as identity cards," said Richard Starkey, "because you don't have to include biometric information on the cards, you don't have to install biometric readers around the UK, you don't need a big database able to store biometric information."

But not everyone is convinced. Peter Prior of the renewable energy and waste disposal company Summerleaze, for example, believes a carbon tax - a concept which has won its spurs in Norway as an emissions reduction tool - would be a better bet.

"We've looked at it, and to us, a carbon tax would be more efficient," he told the Westminster meeting.

Cyclist with passenger overtakes car.  Image: AP
DTQs would enable cyclists to overtake motorists financially
"It would benefit suppliers of alternative energy and people who wanted to be energy efficient, and it wouldn't have to be regressive - it really wouldn't."

But one of the enduring political mantras is that electors don't like taxation; and especially they don't like talk of new taxes.

Tradable quotas, though, can claim support from different political ideologies.

Right-wing free-marketeers like them because they are market-based and allow people the full panoply of personal choice.

Left-wing social thinkers like them because they are equitable, and because they will have a net effect of redistributing income; overall, poor people produce lower greenhouse gas emissions, and so would be more likely to be sellers than buyers of carbon.

Long game

None of which means, of course, that carbon cards will be coming to a wallet near you any time soon.

Judging by comments at the Westminster meeting, the cost of a DTQ scheme is clearly an issue, as is that fact that it might simply befuddle a lot of people, despite Colin Challen's belief that it is just a reward card in green clothing.

Perhaps the biggest obstacle is the length of the vision.

I think this is a brilliant idea and would certainly get people switching off those extra lightbulbs and not heating empty rooms
Rachel Coldbreath, London

It is easy for governments to set long-term targets for reducing greenhouse gas emissions, whether it is the UK's 60% by 2050, Jacques Chirac's vision of 75% by 2050, or even Governor Schwarzenegger's pledge of 80% by 2050.

It is not so easy for governments to establish long-term policy initiatives which will produce the year-on-year decrements needed to meet those targets.

A survey of companies involved in the European ETS, just published by the European Commission, shows that a long-term framework is key to the scheme's success; and a long timeline would be crucial for DTQs, too.

But the concept has made it to the in-trays of at least three government departments.

There is interest at European level too, with the think-tank Velo Mondial pusing a similar concept called the Kyoto Chip.

As the latest UN climate conference opened for business in Montreal, David Fleming was in optimistic mood.

"The UK, like all countries, has to make big commitments internationally," he said, "but you can't make commitments internationally and then have no idea how to meet them.

"By the standards of other policy instruments, personal quotas could prove enormously popular because it's not another drain on income - it could be money coming into the wallet."

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