User:Beccasmith16/sandbox

Background
The Carbon Trade Exchange focuses on exchanges with many global environmental commodities. Some examples of these are carbon, renewable energy certificates, and water. Current countries that have this are Australia, the United States, and the European Union. This program helps companies invest in sustainable, clean technology, and energy efficient projects. The goal of this is to have a more efficient and low carbon economy. The Carbon Trade Exchange is paired with many agencies, like, APX, Climate Action Reserve, American Carbon Registry, VCS, Gold Standard, and the Australian REC Registry. The platform also links with financial registries to help with efficient trading and create liquid and transparent markets.

How Carbon Trade Exchange Works
Each country is given a cap on how much carbon emissions they are allowed to release. Companies that go over their cap are able to buy credits from companies that do not go over. The goal is to prevent companies from averaging over the baseline. This allows companies to have incentives to not go over. If they go over they have to buy carbon credits and when they don’t go over they get to save money. The trading can take place regionally, nationally, and internationally.

Reasons to Have the Carbon Trade Exchange
The use of fossil fuels releases carbon dioxide into the air and it leads to negative impacts on third parties. There are both health and environmental costs that come from the emissions. Some of the health costs include heart diseases, lung diseases, cancer, and strokes. The environmental costs are environmental degradation, pollution, climate change, and global warming. Studies have shown that the countries that are impacted the most from climate change, are the countries with the lowest greenhouse emissions.

Advantages
The Carbon Trade Exchange is easy to implement in places compared to other methods. This also allows a relatively easy method for decarbonization and room for economic growth. After the Carbon Trade Exchange started, there was a reduction in carbon dioxide emissions, which led to a decrease in acid rain. Companies are also adopting energy efficient technology.

Critiques
There is debate over some countries exploiting the trading system, which can lead to negative consequences. The Carbon Trade Exchange is also challenging because it includes having to find a compromise between profit, equality, and ecological concerns. Other disadvantages of the Carbon Trade exchange is that there is unpredictable price volatility, making trading floors a public expense, overhead costs, and a lot of complexity.