Personal carbon trading

Personal carbon trading is the generic term for a number of proposed emissions trading schemes under which emissions credits would be allocated to adult individuals on a (broadly) equal per capita basis, within national carbon budgets.[1] Individuals then surrender these credits when buying fuel or electricity. Individuals wanting or needing to emit at a level above that permitted by their initial allocation would be able to purchase additional credits from those using less, creating a profit for those individuals who emit at a level below that permitted by their initial allocation.[2]


Current proposals include:

Individuals would most likely hold their emissions credits in electronic accounts, and would surrender them when they make carbon-related purchases, such as electricity, heating fuel and petroleum. PCAs could also require individuals to use credits for public transport. Tradable Energy Quotas would bring all other sectors of society (e.g. Industry, Government) within the scope of a single scheme.

Individuals who exceed their allocation (i.e. those who want to use more emissions credits than they have been given) would be able to purchase additional credits from those who use less, so individuals that are under allocation would profit from their small carbon footprint. There are two types of carbon credits, Certified Emission Reduction credits EUAs and CERs and Verified Carbon Credits.[11]

Proponents of personal carbon trading claim that it is an equitable way of addressing climate change and peak oil, as it could guarantee that a national economy lives within its agreed carbon budget and ensure fair access to fuel and energy. They also believe it would increase ‘carbon literacy’ among the public, while encouraging more localised economies.[12]

Personal carbon trading has been criticised for its possible complexity and high implementation costs. As yet, there is minimal reliable data on these issues. There is also the fear that personal "rationing" and trading of allowances will be politically unacceptable,[13] especially if those allowances are used to buy from industries who are already passing on costs from their participation in carbon levy or trading schemes such as the EU ETS.

Research in this area[14][15] has shown that personal carbon trading would be a progressive policy instrument - redistributing money from the rich to the poor - as the rich use more energy than the poor, and so would need to buy allowances from them. This is in contrast to a direct carbon tax, under which all lower income people are worse off, prior to revenue redistribution.

Progress towards implementation

Norfolk Island is trialling the world's first personal carbon trading programme, starting in 2011.[16][17]

The Climate Change Act 2008 also grants powers allowing the UK Government to introduce a personal carbon trading scheme without further primary legislation.[18]

In May 2008 DEFRA completed a pre-feasibility study into TEQs, with the headline finding that "personal carbon trading has potential to engage individuals in taking action to combat climate change, but is essentially ahead of its time and expected costs for implementation are high". Based on this DEFRA announced that "the (UK) Government remains interested in the concept of personal carbon trading and, although it will not be continuing its research programme at this stage, it will monitor the wealth of research focusing on this area and may introduce personal carbon trading if the value of carbon savings and cost implications change".[19]

Later that same month the UK Parliament's Environmental Audit Committee produced their report on the subject, which concluded that ”personal carbon trading could be essential in helping to reduce our national carbon footprint" and rebuked the Government for delaying a full feasibility study, stating that "although we commend the Government for its intention to maintain engagement in academic work on the topic, we urge it to undertake a stronger role, leading and shaping debate and coordinating research".[20]

Analysts have noted that to implement any effective carbon rationing system, "the government must convince the public that rationing levels are fair, that the system is administered transparently and fairly, and that evaders are few in number, likely to be detected and liable to stiff penalties if found guilty."[21]

A 2010 paper into attitudes towards personal carbon trading suggests a general ambivalence, however the researchers noted that "In fact, moderate support was the commonest view".[22] A 4-week consumer trial on Personal Carbon Allowances carried out in London in June 2011 reported that "Participants engaged with the personal carbon allowance concept with enthusiasm".[23]

In January 2011, the UK's All Party Parliamentary Group on Peak Oil published a report into TEQs, garnering significant media coverage.[24] This report highlights the significant research from a number of research centres produced since the Government's pre-feasibility study, and argues that these studies demonstrate the benefits of to be far greater than was acknowledged in the Government's research. Accordingly, it urges them to move quickly to fund moves towards potential implementation in the near future.[25]

Related emissions reduction proposals and initiatives


Carbon rationing is considered in the feature film The Age of Stupid,[27] released in February 2009.[28]

See also


  1. "An introduction to personal carbon trading", Climate Policy journal, Volume 10, Number 4, Sept 2010 , pp. 329-338
  2. How would TEQs work?, on
  3. Tyndall Centre for Climate Change Research
  4. RSA CarbonLimited Partners and Supporters
  5. UK Government pre-feasibility study into TEQs
  6. The reports from the UK government pre-feasibility study can be downloaded in full here
  7. All Party Parliamentary report into TEQs
  8. Environmental Change Institute (ECI) - Oxford University
  9. Personal Pollution Allowance Proposal:
  10. End-user Emissions Trading
  11. Types of Carbon Credits
  12. David Fleming (2007), Energy and the Common Purpose, 3rd edition
  13. Parag, Yael; Eyre, Nick (2010). "Barriers for Personal Carbon Trading in the UK policy arena.". Climate Policy. 10 (4): 353–368.
  14. The Distributional Impacts of Economic Instruments to Limit Greenhouse Gas Emissions from Transport, Simon Dresner and Paul Ekins, Policy Studies Institute
  15. Joshua Thumim and Vicki White, Centre for Sustainable Energy (2008). Distributional Impacts of Personal Carbon Trading: A report to the Department for Environment, Food and Rural Affairs. Defra, London
  16. Media release: Norfolk Island to trial world first Personal Carbon Trading program - 27/10/2010
  17. Norfolk Island Carbon/Health Evaluation (NICHE) website
  18. "What is the progress towards seeing TEQs implemented in the UK?", from TEQs website - accessed 23 Jan 2011
  19. DEFRA press release - 8 May 2008
  20. Environmental Audit Committee - Personal Carbon Trading: Fifth Report of Session 2007–08
  21. Roodhouse, Mark (March 2007). "Rationing returns: a solution to global warming?". History & Policy. United Kingdom: History & Policy. Retrieved 9 December 2010.
  22. Public attitudes to personal carbon allowances: findings from a mixed-method study
  23. "Personal Carbon Allowances White Paper". United Kingdom: Carbon Trust Advisory and The Coca-Cola Company. April 2012. Retrieved 14 August 2012.
  24. Media coverage of All Party Parliamentary report into TEQs, from, accessed 23 Jan 2011
  25. All Party Parliamentary report into TEQs
  26. Home | CRAGs
  27. Brendan Barrett, "Better than Star Wars: The Age of Stupid", 25 September 2009
  28. Release dates for The Age of Stupid - IMDb

External links


TEQs (Tradable Energy Quotas) - formerly known as Domestic Tradable Quotas

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