Carbon Trading Halted After EU Exchange Is Hacked 228
chicksdaddy writes "The European Commission (EC) suspended trading in carbon credits on Wednesday after unknown hackers compromised the accounts of Czech traders and siphoned off around $38 million, Threatpost reports. EU countries including Estonia, Austria, The Czech Republic, Poland and France began closing their carbon trading registries yesterday after learning that carbon allowances had been siphoned from the account of the Czech based register. A notice posted on the Web site of the Czech based registry said that it was 'not accessible for technical reasons' on Thursday and the EC issued an order to cease spot trading until January 26 so that it can sort out what appears to be chronic security lapses within the system."
Wait, carbon trading wasn't a scam to BEGIN with? (Score:4, Insightful)
I always assumed this whole silly emissions trading business was just one big scam already.
Re:The what? (Score:3, Insightful)
They're guilt removers. People can buy carbon credits to offset their overuse of natural resources and pollution of the air (like Al Gore). This makes them a better person overall, and allows them to continue to tell other people they should all be riding bicycles while they fly around in private jets (like Al Gore).
Or something like that.
Re:How do you even liquidate (Score:4, Insightful)
Comment removed (Score:2, Insightful)
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:5, Insightful)
The entire cap and trade scheme is wrong. Companies should not be permitted to purchase "credits" from companies that are in compliance.
Those companies that are in compliance are following the law, not doing anything special.
Those companies who continue to exceed carbon emission standards should be fined progressively to the point that they achieve zero profit until they rectify the problem.
You either follow the law or you don't.
Cap and Trade is a farce. Perhaps I can purchase some "Non-meth dealer credits" and then sell meth without consequence.
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:2, Insightful)
Apparently you and I have completely different mechanisms for drawing conclusions.
Let me guess, one of you starts from basic propositions and works logically towards conclusions, the other one draws conclusions from his gut reaction and reasons backwards to find propositions that support the foregone conclusion. Yeah. That's it.
Re:The what? (Score:2, Insightful)
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:3, Insightful)
You should read more about the subject, and then you'd realise it isn't.
Indeed. It's more about economic self-mutilation. There are three warning signs: 1) Advocates for carbon trading are upset because carbon emission behavior not changed (market's goal is to ensure carbon emission costs are accounted for by carbon emitters, not to change behavior); 2) Carbon markets are poorly designed in Europe due to hard caps and the flaws have been known since early on (hard caps mean there is a sudden change from a very elastic supply of carbon credits to a very inelastic supply, instead as the supply of carbon credits increases, the marginal cost of additional credits should increase, resulting in a market with a smoothly more inelastic supply as demand increases); and 3) no economic justification for carbon markets (by this, I mean a proper cost/benefits analysis of whether carbon markets or for that matter, any carbon emission reduction strategy which shows greater harm from not implementing the strategy and which takes into account the time value of money).
Re:The what? (Score:2, Insightful)
Re:The what? (Score:5, Insightful)
Why do people always have to bring up Al Gore? He may or may not be a hypocrite. Either way, it matters very little compared to climate change.
If your doctor tells you that you have lung cancer and need surgery, only an idiot would focus on the fact that your doctor smokes and is a hypocrite, and use that as an excuse to keep smoking and not get the scary and painful surgery.
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:5, Insightful)
Consider that people buy and sell goods and services in WoW for actual money.
Also, these kinds of markets is the "cure-all" of classical economist orthodoxy.
And as long as there is a chance to make a profit on it, someone will put money into it.
In the end, it is no different from the recent CDOs and such. It is all numbers being traded via computers...
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:0, Insightful)
Basically correct except for the arbitrary economy generated by a mindless government. Companies are forced to by and sell what are essentially worthless indulgences. And don't forget that some politically favored company must run the exchange and trading firms must take a share of the profits and many agencies will be needed to regulate this fantastic monstrosity. And that all of these costs are paid by us, the people who the fair government is protecting from themselves.
No thanks, its cold and I don't live in a flood plain or on a beach so I am off to burn something.
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:3, Insightful)
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:4, Insightful)
I think the idea of cap and trade is that we need to drasticly cut emissions. The problem is it is hard to come up with a fair way for requiring all of the major polluters to cut emissions. The hope with "cap and trade" it that the free market can be used to fine-tune the original political decisions. If one major emitter finds it is prohibitively expensive to cut emissions because they are actually increasing production, they can buy credits on the carbon market. The hope is that industries with little growth may be able to accelerate equipment upgrades with funds from those industries growing faster than equipment upgrades help.
Of course, until every major government implements strong carbon caps, the carbon market is a shell game. Currently here in Canada they are still talking about "intensity-based targets"; that is to say: carbon releases are allowed to increase as long as there is economic growth. There is also the issue of using hard-to-measure things as "carbon sinks" such as forests. If a framer has a small forest they are being paid credits for; are the expected to pay back all that money if the forest burns down, releasing a lot of carbon?
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:5, Insightful)
You're assuming that it's equally easy for all companies to cut down on carbon emission, and that the total carbon credit can't be altered. Assume that the number of credits is inadequate to allow all companies to do all the carbon emission they want. Somebody's going to have to cut down in this case, which is the desired outcome.
Now, suppose that there's one company that finds it cheap and one that finds it expensive. The cheap one will cut down and sell its carbon credits to the expensive company. The economy is therefore reducing carbon emissions to the set limit in the most economical way possible. As time goes on, the number of carbon credits can be reduced.
There's lots of complications, but overall it's an economically valid approach.
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:5, Insightful)
Here's the catch: if it would cost you less to update your equipment to produce less emissions, it would also probably cost your buyer less to upgrade their equipment than it would cost to buy the credit, so they will not buy the credit.
This is only true if production is occuring in the same way. For example it may be cheaper for a steel mill to support expansion by investing (purchasing credits) making a plastic manufacturer more efficient.
Thus, the only possible long-term effect of cap and trade is that companies who would have upgraded anyway will do so, but will now be able to sell their credits, allowing other companies to produce more pollution than they would have been able to produce under a strict system of caps.
Currently industries can expand without regards to environmental impact since there is little cost impact. Creating a cap sets a limit to how much pollution can be released. The only way for an industry to expand is to become more efficient, or to offset its output elsewhere in the economy. The overall result is net pollution remains the same or is reduced.
It's not sustainable to have uncontrolled growth ignoring the negative environmental effects. Not that cap & trade is perfect, but it does provide market flexibility that traditional government controls don't have.
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:4, Insightful)
What is it with all the global warming deniers?
What's a "global warming denier"? Is that like holocaust deniers? Is this some group of anti-Semitic racists? Or is denying that genocidal events in history ever happened now no worse than denying a vague prediction of events in some future probability?