Europe’s carbon trading scheme has proved to be “disastrous” and a “scam” in which companies have profited with no effect on emissions, a leading politician and a scientist said yesterday.
The environmentalist James Lovelock — who developed the Gaia theory of the planet as a “living organism” — and the former environment minister, Michael Meacher, said that market approaches to green issues, such as the EU Emissions Trading Scheme (ETS), were destined to be distorted by business pressures. Lovelock described similar market mechanisms that attempt to put a price on “services” provided by the natural world as akin to “slavery”.
“In principle [carbon trading] is not a bad idea but in operation it’s been disastrous. Business has frankly made billions out of artificial reductions of what is called hot air with absolutely no environmental benefit at all,” said Meacher, singling out the ETS for being distorted by commerce. “Governments under pressure from industry – the worst example is Germany – gave away far more allowances than industry actually needed.”
As a result, he said, the carbon price collapsed and the ability for companies to claim carbon credits by investing in developing world emissions-cutting projects via the Clean Development Mechanism meant western economies had done little to de-carbonise their industries.
Lovelock said the scheme had failed. “Carbon trading was an idea with potential but the danger is that it so rapidly develops into a scam,” he said.
The comments follow criticism of the ETS from industry insiders including the former chief executive of BP, Lord Browne, who said that the scheme has been ineffective. Vincent de Rivaz, the chief executive of the UK arm of EDF Energy, dubbed the carbon market the new “sub-prime”. Lord Turner, the UK government’s climate adviser, last week called for a floor price on European carbon permits.
Meacher expressed pessimism for future “market-driven environmental action”, whether it was reducing carbon emissions through trading or protecting biodiversity by applying a price to “ecosystem services” such as medicines from rainforests. “I have real doubts because the whole process is distorted at every level. Industry pressures governments by saying ‘if you do this it’ll affect national welfare, it’ll affect jobs and it’ll lead to industry going out of this country, you have to do what we say’. And, one after another, governments fall for it.”
Speaking at a debate on biodiversity organised by the journal Nature at Kings Place in London, Meacher also described the economic slowdown as a “priceless opportunity” to reduce climate change emissions and stop the destruction of tropical forests and coral reefs. “Those issues are only going to get on the agenda during a crisis,” he said.
Lovelock was dismissive of putting a price on services from ecosystems such as oceans and forests. “To talk of these ecosystems as something we can own and draw benefits from, and buy and sell, is just like the attitude not so long ago to slavery, and just as reprehensible,” he said.
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