Texas may be about to increase those emissions in the interests of "good business." This is the sort of perverse incentive that arises in Kyoto Protocol policies as well. TXU has decided to make an art of it by investing in pollution so that it can later meet regulatory requirements to reduce pollution. Perverse.
The Wall Street Journal (WSJ) today reported that TXU, a Dallas-based utility, is building 11 power plants that use pulverized coal.
The paper notes that pulverized coal "releases substantial amounts of carbon dioxide, the most worrisome of several heat-trapping gases widely blamed for global warming." The 11 new plants would more than double the company's carbon-dioxide emissions, from 55 million tons in 2004 to more 133 million tons in 2011.
The WSJ says TXU may be building the plants to take advantage of future restrictions on carbon-dioxide emissions. By building the plants, TXU could earn "allowances" based on its levels of carbon-dioxide emissions -- the higher the emissions, the larger the pollution allowances. Critics say the system essentially "rewards" firms that produce higher emissions before regulations go into effect.