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."
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:2, Interesting)
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:2, Interesting)
How do you even liquidate (Score:3, Interesting)
How does one liquidate siphoned carbon credits? Do they hold a black market value?
Re:More proof that carbon pollution costs the econ (Score:2, Interesting)
"Carbon pollution" is about as valid a phrase as "pigeon antennae."
The thing that costs the economy is people fabricating global catastrophes that aren't there, and legislating "solutions" to false problems in order to steal.
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:4, Interesting)
I'm surprised people/companies were actually seriously putting any type of serious money into this crap.
Are there some countries that are actually mandating carbon credits, etc? I mean, if not by law, why would anyone take part in this scam, unless they were on the money making side?
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:2, Interesting)
The difference is that SOx is an actual poison and CO2 is the natural product of all animal life on the planet and is needed by the plant life. (With the exception of those few sulfur eaters down at the bottom of the ocean near the hydrothermal vents.) Other than that small difference, there is no difference at all between SOx and COx emissions.
I wonder if the guys who stole the credits are thinking they can sell them on the black market to europeans who want to have a backyard cookout? Or did they steal them to cover for the CO2 emissions from their weekend pot smoking binge?
Re:The what? (Score:2, Interesting)
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.
Wrong analogy. The analogy is that the doctor tells you not to smoke (in a condescending and moralizing way) so you don't get lung cancer, and then goes outside and smokes.
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:4, Interesting)
I mean, if not by law, why would anyone take part in this scam, unless they were on the money making side?
Guilt? Good public relations? There are plenty of reasons. Penn and Teller did a decent episode on it - they exposed some of the "carbon credit" companies for the scams that they are, and they also sent out a woman to randomly approach people doing their shopping, "assess" their purchases for carbon emissions (by randomly throwing out numbers) and then ask them to pay for the environmental damage. Most people seemed glad to fork over the cash.
Re:Wait, carbon trading wasn't a scam to BEGIN wit (Score:2, Interesting)
And this is how I know that the folks who came up with this scheme failed high school economics. The mere fact that you can make money selling credits does not inherently provide any incentive to reduce pollution. It only provides incentive to do so if the amount you make by selling those credits exceeds the amount it would cost you to update your equipment to produce less emissions.
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. As soon as you understand that fundamental flaw in this scheme, the whole thing falls apart. The inherent value of the carbon credit must, then, be cheaper than the cost of the upgrades in order for anyone to buy them. So with the exception of a few edge cases (where upgrading is unusually cheap or expensive), these don't provide any incentive at all, and most of those would either already have converted to cleaner energy or would be specifically exempted from pure caps anyway, making those edge cases largely uninteresting.
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.
Worse, this is the case in the short term as well. If initially there are companies that produce substantially less than the cap as you propose (as opposed to each company being capped at its current output), then there will be a glut of these credits, making them much cheaper than the cost of upgrading equipment, thus providing not just incentive not to upgrade, but also incentive to horde credits so that you can continue to pollute more and more at will, in effect eliminating environmental regulation altogether.
In short, cap and trade can only lead to increased pollution in reasonable human timeframes, not decreased. Sure, it does limit the growth to a certain total, which might result in lower total pollution in the really, really long term, but even that requires us to assume that the market will never result in newer, lower-polluting manufacturing technology being cheaper than ancient clunker hardware. Color me unconvinced.
The only way cap and trade is useful is if the current total is substantially less than the total output now, and to the extent that this is the case, the same can be achieved with simple caps, goals, and fines.