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Greenhouse gas trading to become reality in EU European companies required to reduce their greenhouse gas emissions will soon be able to buy, sell, or bank carbon credits under the world’s first multinational emissions trading system, which was finalized in July by the European Union (EU). The market, slated to open in 2005, is seen by EU officials, environmental groups, and industry alike as a key tool for meeting EU emissions reduction targets agreed to under the Kyoto Protocol on climate change and is expected to reduce industrial compliance costs by as much as 35%. For now, only carbon dioxide (CO2) emissions will be covered under the scheme; EU member states will develop national plans that set reduction targets for relevant industrial sectors and allocate emissions allowances to specific installations. The caps imposed must be in line with each country’s Kyoto commitments and approved by the European Commission (EC) by April 2004 (Environ. Sci. Technol. 2003, 37, 89A). The system is based on the U.S. trading system for sulfur dioxide emissions implemented under the 1990 Clean Air Act Amendments, notes Kevin Baumert, a senior associate at the World Resources Institute, an environmental research organization. Although President Bush is ada© 2003 American Chemical Society
mantly opposed to any mandatory limits on CO2 emissions, the use of market-based emissions trading under the Kyoto Protocol was added at the insistence of the United States in the mid-1990s. “Now, ironically, it’s the Europeans who are out in front actually implementing a large-scale emissions trading system,” Baumert says. More than 10,000 large-scale facilities face emissions limits during the system’s first phase from 2005 to 2007. Sectors covered include the electricity, oil refining, cement, iron and steel, glass and ceramics, and pulp and paper sectors, which account for nearly half of all European CO2 emissions, according to the EU. Meanwhile, an EC directive proposed in late July could link the capand-trade system to the other flexible mechanisms allowed under the Kyoto Treaty for reducing the cost of cutting greenhouse gas emissions, namely the clean development mechanism and joint implementation. Through these two instruments, countries can meet part of their Kyoto commitments by investing in greenhouse gas reduction projects in developing countries. Environmentalists oppose this linkage, however, because they fear such an action could eliminate any motivation for EU companies to reduce their own emissions. These mechanisms also are untested, and there are no clear rules about what will be allowed and what will be excluded. On the other hand, Eurelectric, an electric industry trade organization whose members account for the bulk of emissions covered under the new trading scheme, wants to see Kyoto’s flexible mechanisms brought into play starting in 2005 rather than 2008, which is the date the EC is considering. Such a move would bring more credits onto the market, lowering their prices and helping companies to maintain their competitiveness in global markets, according to the trade group.
After trading begins in 2005, the EC plans to review the system in 2006, with an eye toward including other greenhouse gases, as well as other industrial sectors—such as the chemical, aluminum, and transport industries—during the system’s second phase, which will run from 2008 to 2012. —KRIS CHRISTEN
Canada, U.S. explore crossborder pollution trading Canadian and U.S. officials are launching a study to determine if cross-border trading of nitrogen oxide (NOx) and sulfur dioxide (SO2) could help reduce transboundary air pollution. But academic and environmental critics contend that this research project must address the weak Canadian requirements for emissions monitoring and reporting if the United States and Canada want to develop an international system. The two-year trading project, a cooperative effort by Environment Canada and the U.S. EPA, was announced on June 19. It is part of the $29 million Border Air Quality Strategy designed to promote emission reductions in both countries, says Jane Barton, chief of international smog programs for Environment Canada. The trading study will continue previous efforts to model how a potential transboundary trading system would change pollutant emissions and who would buy and sell emission allowances, Barton says. The project will also seek to determine what regulatory and legal tools would be necessary to make U.S. trading schemes, such as those found in the acid rain program and the Ozone Transport Commission NOx budget trading program, work in Canada. “The issue of emissions monitoring and reporting has long been an irritant in Canada–U.S. relations,” says Debora VanNijnatten, a political scientist at Wilfred Laurier University in
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Waterloo, Ontario. For example, EPA criticized Ontario’s NOx and SO2 trading program because continuous emissions monitors were not a hard and fast requirement for any smokestack and because it allowed trading between capped and uncapped sources (Environ. Sci. Technol. 2002, 36, 14A). “Ontario is supportive of trading with the U.S.,” responds Tony Rockingham, director of air policy and climate change at the Ontario Ministry of the Environment (MOE). Ontario now requires all coal-fired power plants to have continuous emissions monitors for SO2 and NOx, and other smokestacks in the cap and trade program must get MOE approval to use technologies other than those used in the United States, he says. Although Ontario still allows trading between capped and uncapped sources, the province is bringing more and more industries into its cap and trade program, he adds. —JANET PELLEY
U.S. EPA issues research guidelines DAVID HANSON
The U.S. EPA has released new guidance aimed at improving the quality of information it receives from outside Paul Gilman scientists. Announced on July 2 by EPA Science Advisor Paul Gilman, “A Summary of General Assessment Factors for Evaluating the Quality of Scientific and Technical Information” is designed to inform non-EPA scientists about how agency analysts will evaluate published research papers, data submitted for pesticide registrations, and other information they might use in regulatory or research projects. The guidance names five general assessment factors that agency staff use when judging the quality and relevance of scientific and technical information: soundness, applicability and utility, clarity and completeness, uncertainty and variability, and evolution and review. These factors apply to information such as scientific theories, computer codes for
modeling environmental systems, economic analyses, demographic data, chemical toxicity testing, and environmental fate and transport data. The goal is to “help people understand what goes through the minds of our technical folks when they are evaluating technical information,” Gilman said when announcing the guidelines. They also let EPA analysts know what they should consider when evaluating external work, he added. Even if scientists aren’t doing research directed at an EPA project, they should keep these guidelines in mind, Gilman says. The current trend among scientific journals to run short research articles puts the agency at a disadvantage, because some of what is cut could indicate whether the work is significant and applicable to an agency project. “I’m looking for an opportunity to sit down with the editors of [a few] journals to make it clear that shortening an article doesn’t help us,” Gilman says. A copy of the guidelines can be found at www.epa.gov/ osp/spc/2polprog.htm —CATHERINE M. COONEY
EU sets GMO labeling, traceability rules All food and animal feed products containing more than 0.9% of genetically modified constituents will soon sport labels that say so as early as this fall under new rules adopted by the European Union (EU) in July. The labels, as well as a new system designed to trace genetically modified organisms (GMOs) at all stages of production and marketing, are expected to facilitate environmental monitoring so that products may be withdrawn from the market if any unexpected adverse effects arise, according to the European Commission (EC). EC officials expect the legislation to effectively lift a de facto moratorium that EU countries have levied against approvals of any new GM crops since 1998. The unofficial ban is the subject of a complaint filed before the World Trade Organization in May by the United States (Environ. Sci. Technol. 2003, 37, 248A), but the American Farm Bureau Federation (AFBF) contends that the new rules only strengthen the U.S. position on the matter.
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“In this case, the remedy is worse than the disease,” with the requirements creating a new kind of trade barrier with heavy cost implications, says Ron Gaskill, an AFBF international trade policy specialist. Because grains and oilseeds are blended from thousands of sources before ending up in processed products or being loaded onto ships for export, it will be virtually impossible to avoid the labeling requirement, he says. He predicts that a mound of paperwork for each product will be needed to ensure compliance with the new traceability rules. The rules are “too aggressive for the risk that’s to be mitigated,” Gaskill adds, noting that there are no scientific data indicating that even a 100% biotech product is unsafe. However, a set of standards adopted in July by the Codex Alimentarius Commission, the United Nations’ food standards agency, for assessing the risks to consumers from foods derived from biotechnology may bolster the EU stance. The new guidelines cover the safety assessment of GM food plants, product tracing, and the transfer of genes from commonly allergenic foods, as well as advice against using antibiotic resistance marker genes in GMOs. Because Codex standards can provide a legal basis for trade disputes, they may help to justify the EU’s approach on food safety grounds, according to Consumers International, a worldwide coalition of consumer organizations. For environmentalists, the rules are a mixed bag. Friends of the Earth (FOE) welcomes some aspects, namely the labeling requirements, as well as provisions allowing EU member states to take preventive measures to ensure that GM crops do not crosspollinate with conventional and organic crops, says Geert Ritsema, an FOE spokesperson. But the group finds the 0.9% labeling threshold too high because currently available testing techniques can reliably detect GMOs as low as 0.1%. FOE is also calling for strict regulations to make biotech companies liable for any contamination or environmental problems. The new rules will go into effect this fall after they are signed by the EU Council of Ministers, which has already agreed to them. —KRIS CHRISTEN
