Small and medium businesses to start carbon trading?

The UK's Department of Trade and Industry (DTI) is considering a scheme in which small and medium-sized firms may face pollution limits in the UK's drive to cut carbon dioxide (CO2) emissions.

If these businesses exceed their allocation of permits to emit CO2 they could soon have to buy additional pollution permits from a carbon market.

Large businesses in the EU, such as power stations and steel works, already have to operate within the constraints of the EU Emissions Trading Scheme. However, medium-sized businesses, such as supermarkets, have so far been left outside the EU scheme.

The UK's Carbon Trust has proposed this move as a way of including more businesses in efforts to cut greenhouse gas emissions.

Although the government's much-delayed climate strategy review is due to be published in the next few weeks, the BBC's Roger Harrabin has discovered that the DTI is worried that businesses have already borne too much of the burden when it comes to reducing national emissions of carbon dioxide (17.5% cuts since 1990) and is resisting calls to ask much more of business.

This concern seems to miss the point that businesses are not charities and have a habit of passing on costs to their consumers!

This business-centric view also downgrades the importance of the available science, which consistently tells us that severe cuts in greenhouse emissions are necessary in order to keep CO2 concentrations within levels that are likely to be "safe" for humanity.

It also diminishes the input of the department for the environment (DEFRA) which has told ministers that bigger cuts will be needed in order to achieve the 20% cut in emissions by 2010 pledged during the past three elections.

It will be interesting to see which department has won this argument when the climate review is published...