Cap'n trade detractors, rejoice!

Carbon offsets and international trading have long been weak links in cap and trade scheming.  Ensuring that offsets generated abroad are legitimate is a mammoth undertaking, particularly when  they come from areas with notoriously lax environment oversight.  Now, the European Commission is set to ban carbon permits generated by Chinese industrial gas entities from trading inside the E.U.

The European commission is planning to clamp down on a £1.6bn carbon trading scam. The use of carbon permits from industrial gas projects in China could be banned because of their "total lack of environmental integrity", the climate change commissioner, Connie Hedegaard, has told the Guardian.

Billions of euros' worth of the controversial permits were used between 2008-09 in the European Union's emission trading scheme (ETS), in which companies must exchange pollution permits for any emissions produced. The ETS allows some of those permits to be bought in from developing countries.

U.S. proponents of cap and trade as a means to control domestic carbon emissions have looked to the ETS as a model for the successes, and undoubtedly pitfalls, of implementing market-based approaches to environmental regulation.  The ETS is the largest multi-national carbon trading scheme in the world.  The E.C. reports that their scheme has created certain perverse incentives, in this instance the building of carbon-generating facilities in China and India for the purpose of creating negotiable carbon permits.