Table of Contents

Emissions Trading in the U.S.: Experience, Lessons and Considerations for Greenhouse Gases

Foreword     ii

Executive Summary    iii

I. Introduction    1

    A. Overview of the Concept of Emissions
            Trading   1
    B. Three Basic Types of Emissions Trading Programs   4
    C. Other Features of Emissions Trading Programs   5
    D. Objective and Organization of this Report   6

II. Experience with Emissions Trading    8

    A. EPA Emissions Trading Programs   8
    B. Lead-in-Gasoline Program   9
    C. Acid Rain Trading Program   11
    D. Los Angeles Air Basin RECLAIM Program   20
    E. Mobile Source Averaging, Banking,
        and Trading Programs   27
    F. Northeast NOx Budget Trading   29

III. Lessons from Experience with Emissions Trading    32

    A. Economic Effectiveness   32
    B. Environmental Effectiveness   33
    C. Ability to Trade   35
    D. Banking   37
    E. Initial Allocation   38

IV. Considerations for Greenhouse Gas Control Programs    40

    A. Suitability of Trading   40
    B. Opt-in Features   41

V. Conclusions    44

Glossary     47

Endnotes     49

References     54