How Cap and Share works

1 The Cap Cap and Share can be implemented nationally, at EU level, or around the world. If it was adopted internationally, a world Atmosphere Protection Trust would cap (limit) global greenhouse gas emissions at their present level. Then, using the best scientific advice, it would tighten the cap each year so that emissions eventually fell to a level at which they were no longer causing the climate to change. The Atmosphere Protection Trust would share out Production Authorisation Permits PAPs between countries on an adult per capita basis.

2 The Share Every year, national Climate Protection Trusts would share out whatever emissions tonnage had been allocated to them by the Atmosphere Protection Trust by issuing Production Authorisation Permits equally to every adult resident in their country.

A mock EU citizens PAP that would probably be issued as part of an informative booklet nationally. Why 2.65 tonnes? Four per year would be 10.6 tonnes and smooth out the sales flow. At present 395 million adults in the EU27 average 10.9 tonnes of CO2 per year each. To stay below a 2 degree C rise in temperature the Stop Climate Chaos coalition proposes a 3% year-on-year reduction - so next year’s permits would be 10.6 tonnes, and in 2009 some 10.3 tonnes. If the EU was in an emissions permit trading bloc with poorer countries this would be set lower - so that EU fuel companies would have to buy more permits from poorer people emitting less carbon. How much might this PAP be worth? A price of €20 to €30 per tonne seems likely, so each adult would get €212 to €318 for 10.6 tonnes. As the cap tightened year by year each tonne would be worth more and more. If issued as part of a global scheme this entitlement would be about 6 tonnes CO2/adult/year.

3 The Sale  When people received their PAPs, they could take them to a bank, post office or other financial institution and sell them at the current market rate, exactly as if they were foreign currency notes. On the other hand, they might choose not to authorise the production of fossil fuel the permits conveyed. In this case, they would destroy their permits and thus reduce the world's emissions by their share. This annual distribution of fossil fuel PAPs would provide those who sold them with a supplementary income to offset the rising cost of fossil fuels. The tighter the cap became, the fiercer the competition for PAPs would become and the more we would get when we sold them. Indeed, since a majority of the world's population use little energy and would thus get more for their PAPs than their cost of living went up, there would be pressure on the global Atmosphere Protection Trust to accelerate the rate at which it was tightening the cap.

4 The Buy Surprisingly few companies introduce coal, oil and gas into the world economy. These firms would need to acquire enough PAPs to cover the eventual emissions from the fuels they sold. Only these fossil energy suppliers would need to buy permits from the banks or other financial intermediaries. Fuel users, whether families, companies or utilities, would never need them to purchase fuel, keeping the system simple and easy to manage.

5 The Enforcement A corps of inspectors would be set up to verify that the quantity of fossil fuel each company produced was in line with the number of PAPs it had bought. Unless there was serious undiscovered cheating, the world would be certain to stay below its emissions target.An important feature of C&S it that policing it would only involve fossil fuel producing companies. Other companies and individuals would not be affected, again keeping the system simple.

Quick Guide Cap and Share in two sides of A4