In a major environmental statement, Pope Francis said cap and trade programs aren't effective at solving global climate change. But New England has made cap and trade a big part of its environmental policy.
Here in Connecticut, we're part of RGGI (pronounced "Reggie"), which is the Regional Greenhouse Gas Initiative and includes New England, New York, and a few mid-Atlantic states.
It's essentially a cap-and-trade deal. Power plants can create a certain amount of heat-trapping carbon emissions, and if they fall under their limit, they can sell pollution credits to other companies. The idea is to gradually reduce emissions, while ensuring companies have enough permits to cover their pollution in a given year.
"These are policy instruments that a number of pro-environment actors have been hoping to use to get dangerous carbon pollution under control," said Matto Mildenberger, who studies carbon pricing policies at Yale University.
In his encyclical, Pope Francis said, "The strategy of buying and selling 'carbon credits' can lead to a new form of speculation which would not help reduce the emission of polluting gases worldwide. This system seems to provide a quick and easy solution under the guise of a certain commitment to the environment, but in no way does it allow for the radical change which present circumstances require."
But economists argue RGGI has worked well as an incremental step to reduce carbon emissions and avoid the national gridlock over pollution standards in the U.S.
Still, Mildenberger said similar cap and trade policies in Europe haven't always been as effective. "There's been a lot of political contestation over how ambitious and how stringent the cap and the standards inside that system should be," he said, "I think the Pope is also probably hoping to speak to that internal European debate right now about how to reform and increase the efficacy of the European carbon pricing system."
The best way to control emissions, economists say, is to directly tax carbon pollution from individual companies.
Meanwhile, RGGI will continue to reduce carbon pollution standards in New England until 2020.