Germany Abandons Cap and Trade for Major Industries

Just as the Obama administration and its allies in Congress try to ram through cap and trade legislation, European countries are moving to exempt entire industries from the regulation lest they simply relocate their operations to more business-friendly nations. The Financial Times reports:

Berlin is preparing to help domestic industries overcome the economic crisis by cutting the electricity bills of the country’s largest energy users. Aluminium, copper and zinc producers are among energy-intensive industrial sectors that could benefit from the plans, which are set to be agreed ahead of elections in September…. The bulk of any relief is likely to be found by reimbursing companies for the cost of carbon dioxide emissions trading certificates that utilities currently price into their electricity bills. Berlin successfully argued at an EU summit in December that energy-intensive industries should be not be forced to buy emission permits between 2013 and 2020 because companies would shift production overseas. It now wants to go further by compensating energy-intensive companies in the intervening years. Officials are also considering whether to reward big power consumers for their role in balancing the electricity network during peak-load periods.

So the largest energy users in Germany are to be exempted from any carbon tax system, but Democrats in Washington are devoting their full attention to imposing just such a system on struggling industries here in the United States — and they’re pointing to Europe as the model! No doubt any legislation the Democrats produce will likewise be full of holes for big business, leaving the little guy to carry most of the tax burden, but if Europe is the model, it is cause for some relief to see that even the Europeans are not prepared to commit economic suicide for the sake of reducing emissions. Whatever systems the Democrats put in place in this country, the moment people start losing jobs and bearing the heavy costs they were told would never come due, it won’t be but one election cycle until the whole thing comes apart.

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