Carbon Credits: The House Always Wins


…Unless of course the “House” gets shut down on charges of corruption, fraud, bribery, price fixing and graft. At which point the rest of the story just recedes into fading history.

Nobody gives much thought to Enron anymore these days…

However, back in it’s heady heyday, Enron had become an energy giant with bets hedged into solar, wind, and of course its main play in natural gas. Enron had also become a key proponent to the Kyoto Protocol which sought to trade in carbon offset credits, via a system very similar to the EPA’s Sulphur Dioxide cap-trade program. A program which Enron itself had already championed to demonstrate it’s corporate environmental responsibility, while profitably reigning in the polluting activities of competing Coal-fired electricity production.

This was also an effective hedge against the performance of Enron’s own natural gas assets – which clearly underpinned the more economical method of generating electricity, while the Sulphur Dioxide credits remained fully priced for coal driven power.

So now, as CO2 is becomes ‘gameified’ as well, let’s consider the nature of a Cap&Trade solution to global warming. Then ponder the crucial question, of whether we’d prefer a Top-Down solution based in international finance mechanisms geared to beneit the brokers and players, or if we’d rather try to change our Societies and our Economies through a more grass roots approach to positive Climate Change.

Consider the amount of power that’s at the base of the pyramid, before hoping that Socio-Economic Change gets handed down from on high?


For more Environmental Games you can also open:
“Climate Change: Gaming the Odds”

Since the time when Enron had placed it’s first bets in SO2 stack-scrubbing, the underlying technologies have been greatly improved, the costs reduced, and therefore the market for SO2 credits has cooled significantly, since it’s now cheaper to simply reduce SO2 emissions than to buy offsetting credits.

Of course, Enron has also taken its infamous fall from grace as well, but the potential for financial gains from such a cap-and-trade system was already very well demonstrated. This credit trading system, which had been administered by the Chicago Board of Trade was now well established, and primed for a new application, but what would the next application be for this new way to print currency, erm “credits” – who’s adoption would surely be driven by precisely tuned Political positions, and well publicised environmental necessities? As we all know, the next objective has been to commodetize CO2 into”carbon-credits”. Ultimately, by making huge economic and environmental gains in a market driven trade of these assets, Carbon offset credits are set to open up a world of possibilities.

”Enron stood to profit millions from global warming energy-trading schemes”

– Mike Carey
President of the Ohio Coal Association and American Coal Coalition

There’s certainly so very much more to come on this subject, but for now let it suffice to say, that there’s obviously a great deal of money to be made in the CO2 considerations, implications, and well-vested interests that underpin a properly publicized and well-managed Green Movement. Please don’t get up yet though, because this game is just getting underway…

Here’s more about gains that are possible in a:

“Captive Market for Carbon Dioxide”



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  1. 07/12/2009 at 12:25 PM

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