Cap and Trade Reduces Smog, EPA Says

10-19-09, 9:46 am

A new report from the Environmental Protection Agency last week touted the success of a cap and trade program (known as NOx Budget Trading Program, or NBP) on emissions of nitrogen oxides (NOx), which has reduced smog and acid rain in key areas of the country.

The study, which examined the impact of the NBP program on NOx pollution in 2008 in 20 eastern states, found that emissions from power plants and large industrial sources fell by 62 percent from 2000 levels and about 75 percent since 1990.

The report also revealed that 97 percent of the region under study saw improved air quality with 85 percent below national smog standards.

The EPA study linked these strong improvements in air quality and reduced NOx emissions to the market-based cap and trade system that regulates those emissions. The program provides investments in cleaner technologies that also help reduce emissions.   Congress created the program in 1998 and put it into effect in 2003. The region covered by NBP includes from eastern Missouri to Massachusetts and Alabama to southern portions of Michigan.

According to the EPA website, the cap and trade program works by setting a cap on the total amount of NOx a business or government entity can emit. Those entities can then purchase 'allowances' (by the ton) over the cap. If they emit less then they are allowed, they can save their allowances or sell them to other entities in a marketplace. If they emit more than they are allowed, they must purchase additional allowances.

'Cap and trade programs … have proven highly effective in reducing emissions from multiple sources while meeting environmental goals and improving human health,' the EPA stated.

A nationwide program to control the emission of sulfur dioxides that cause acid rain, implemented in 1994, has reduced that damaging pollution by at least 50 percent, a separate finding by the EPA revealed earlier this year.