Article: Trading in Pollution: Creating Markets for Carbon and Waste
This article evaluates the initial performance of both the European Union Emissions Trading Scheme (EU ETS) and the Landfill Allowance Trading Scheme (LATS). In so doing it examines the essential components for a functioning emissions trading scheme and considers the extent to which environmental trading systems and fiscal instruments are capable of fundamentally altering our consumption patterns and political ideology towards environmentally sustainable practices. Directive 2003/87/EC established a scheme for the trading of allowances in greenhouse gas emissions. However, the extent to which Phase I of the EU ETS resulted in any significant reductions in emissions is highly questionable. What is more, Member States appear to lack the political will to significantly address in Phase II, and beyond, some of the fundamental problems with the EU ETS as evidenced by the proposed commitments contained in the Phase II National Allocation Plans submitted to the Commission. In England the design of the LATS would appear to have successfully overcome some of the defects with the EU ETS, providing greater economic incentives and opportunities for long-term planning by socio-economic actors. However, it remains questionable whether the LATS will be the prime engine for change in disposing of biodegradable municipal waste.