emissions, definition of

Emissions

A Carbon Market is a market created from the trading of carbon emission allowances to encourage or help countries and companies to limit their carbon dioxide (CO2) emissions. This is also known as emissions or carbon trading. Carbon emissions trading is a way of offsetting greenhouse gases produced by polluters.


Under Carbon trading, a country having more emissions of carbon is able to purchase the right to emit more and the country having less emission trades the right to emit carbon to other countries. 

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Emissions Cap

A limit placed on companies regarding the amount of greenhouse gases (or other polutants) it can emit.

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Emissions Leakage

This is a concept often used by policymakers in reference to the problem that emissions abatement achieved in one location may be offset by increased emissions in unregulated locations. Such leakage can arise, for example, in the short term as emissions abaters reduce energy demand or timber supply, influencing world prices for these commodities and increasing the quantity emitted elsewhere; and it can arise in the longer term, for example, as industries relocate to avoid controls.

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Emissions Trading

This is an economic incentive-based alternative to command-and-control regulation. In an emissions trading program, sources of a particular pollutant (most often an air pollutant) are given permits to release a specified number of tons of the pollutant. The government issues only a limited number of permits consistent with the desired level of emissions. The owners of the permits may keep them and release the pollutants, or reduce their emissions and sell the permits. The fact that the permits have value as an item to be sold or traded gives the owner an incentive to reduce their emissions.

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Emissions Trading

Emissions trading or cap and trade is usually a government-mandated, market-based approach to controlling pollution by providing economic incentives for achieving reductions in the emissions of pollutants.


This is often associated with carbon trading to allow polluters to 'offset' their pollution by buying equivalent carbon credits.

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