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Carbon Trading Halted After EU Exchange Is Hacked
chicksdaddy writes "The European Commission (EC) suspended trading in carbon credits on Wednesday after unknown hackers compromised the accounts of Czech traders and siphoned off around $38 million, Threatpost reports. EU countries including Estonia, Austria, The Czech Republic, Poland and France began closing their carbon trading registries yesterday after learning that carbon allowances had been siphoned from the account of the Czech based register. A notice posted on the Web site of the Czech based registry said that it was 'not accessible for technical reasons' on Thursday and the EC issued an order to cease spot trading until January 26 so that it can sort out what appears to be chronic security lapses within the system."
I always assumed this whole silly emissions trading business was just one big scam already.
SJW: Someone who has run out of real oppression, and has to fake it.
I don't take Czechs.
How does one liquidate siphoned carbon credits? Do they hold a black market value?
Laugh while you can, monkey-boy.
They're guilt removers. People can buy carbon credits to offset their overuse of natural resources and pollution of the air (like Al Gore). This makes them a better person overall, and allows them to continue to tell other people they should all be riding bicycles while they fly around in private jets (like Al Gore).
Or something like that.
Saying Android is a family of phones is akin to saying Linux is a family of PCs.
They may have sold the credits already. The WSJ piece I submitted about this story has more details:
"It started when an anonymous caller on Tuesday morning told Czech State Police that explosives had been placed at the offices of OTE AS, a private company that manages the Czech Republic's national registry. The police evacuated the registry for five hours.
During that time, the computer network wasn't monitored, OTE officials said. Hackers stole 475,000 allowances, worth 7 million, from a company called Blackstone Global Ventures, an environmental consultancy that trades carbon credits for industrial companies.
The thieves changed account-ownership information and executed illegal trades, said Nikos Tornikidis, a portfolio manager at Blackstone Global Ventures."
My guess is that they executed the trades and siphoned the proceeds off to a bank account somewhere.
The entire cap and trade scheme is wrong. Companies should not be permitted to purchase "credits" from companies that are in compliance.
Those companies that are in compliance are following the law, not doing anything special.
Those companies who continue to exceed carbon emission standards should be fined progressively to the point that they achieve zero profit until they rectify the problem.
You either follow the law or you don't.
Cap and Trade is a farce. Perhaps I can purchase some "Non-meth dealer credits" and then sell meth without consequence.
Congratulations! You've won $38MM in carbon credits!
Saying Android is a family of phones is akin to saying Linux is a family of PCs.
Excellent! Tacos al carbon for everybody!
- None can love freedom heartily, but good men; the rest love not freedom, but license. -- John Milton
Why do people always have to bring up Al Gore? He may or may not be a hypocrite. Either way, it matters very little compared to climate change.
If your doctor tells you that you have lung cancer and need surgery, only an idiot would focus on the fact that your doctor smokes and is a hypocrite, and use that as an excuse to keep smoking and not get the scary and painful surgery.
Companies should not be permitted to purchase "credits" from companies that are in compliance.
"Compliance" is whether or not you are producing more carbon dioxide than allowed by the number of credits you hold. If a company pollutes more, but purchases the appropriate amount of credits, then they are in compliance, are following the law, etc. Sounds to me like you don't understand the point of cap and trade. They are an economically sound way to reduce overall pollution amounts, in other words, they address directly what pollution regulation tries to do indirectly. That is, cap net pollution from the entire system rather than capping individually pollution from each source.
Entirely different; that's a carbon offset.
Carbon credits are part of cap-and-trade, in which CO2-producing industrial concerns have their CO2 production limited by law. Entities that are below their limit can essentially sell the difference between their limit and their actual CO2 emissions to other entities (who presumably would otherwise be above their limit).
If CO2 emissions were simply capped by law, industrial concerns would all have to make CO2 emissions reductions regardless of the cost-effectiveness of doing so. Adding the "and trade" component means that it becomes economically advantageous to make reductions wherever it is the most cost-effective. Since CO2 in the atmosphere doesn't care where it comes from, this means that CO2 emissions are reduced more for lower cost than with a cap-only system.
I'm surprised people/companies were actually seriously putting any type of serious money into this crap.
Are there some countries that are actually mandating carbon credits, etc? I mean, if not by law, why would anyone take part in this scam, unless they were on the money making side?
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
The European Commission (EC) suspended trading in carbon credits on Wednesday after unknown hackers compromised the accounts of Czech traders and siphoned off around $38 million
According to Wall street journal (original poster yuna49) the latest theft was $7 million and the $38 million (0.02% of the market) is the total of the permits missing in action.
You mean paying another group to reduce pollution so you can pollute isn't a scam? It's a shell game whose goal isn't to improve things just to maintain the status quo. It's a pointless exercise. Offer companies tax credits to reduce emissions and fine them for exceeding but letting them pay to pollute is a joke.
I have a headache and I'm quite tired, so feel free to correct me if any of my understanding of the subject is wrong here.
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As I understand it, the basic concept is thus (shown via a hypothetical example):
1) The nation of Countrystan decides that there will be no more than 1,000 tons of carbon exhausted per year, by law, from certain industries.
2) Each business within the industry is allocated a certain number of "carbon credits" that effectively cap how much bad stuff they can spew into the air.
3) Since the total number of credits is a fixed number, any business that doesn't want to be hit with major fines will try to stay under their credits.
4) Businesses that are way below their credits can sell other businesses their credits. Businesses that may exceed their cap can purchase credits from other businesses, but the total number of credits (and thus the total amount of pollution) out there doesn't increase in any way.
5) Due to 4, there are economic incentives to reduce carbon output. Heavy polluters would likely need to buy extra credits, thereby incurring a cost that would offset any financial benefits of lackadaisical pollution control. Light (or non) polluters would (rather than a cost) receive a gain in revenue by selling their allotted credits to businesses that can't keep pace. Therefore, businesses stand to lose money if they pollute and gain money if they cut back on pollution, thereby providing the best kind of incentive (economic) for businesses to get their pollution under control.
6) Eventually, more businesses would have a surplus of credits that no one needs to buy. At this point, I imagine the total number of credits in circulation could be reduced.
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So, this is how I roughly understand the whole carbon credits thing is supposed to work. Am I right here? And does the real-world application work like this model, or is it rife with corruption, bureaucracy, and an inability to accomplish its stated goals like every other government project? Have their been any studies on the effectiveness of such a system?
Random Thoughts From A Diseased Mind (Not For Dummies)
Consider that people buy and sell goods and services in WoW for actual money.
Also, these kinds of markets is the "cure-all" of classical economist orthodoxy.
And as long as there is a chance to make a profit on it, someone will put money into it.
In the end, it is no different from the recent CDOs and such. It is all numbers being traded via computers...
comment first, facts later. http://chem.tufts.edu/AnswersInScience/RelativityofWrong.htm
Congratulations! You've won $38MM in carbon credits!
Sorry, guess he didn't after all. The Czech bounced.
Tequila: It's not just for breakfast anymore!
I mean, if not by law, why would anyone take part in this scam, unless they were on the money making side?
Guilt? Good public relations? There are plenty of reasons. Penn and Teller did a decent episode on it - they exposed some of the "carbon credit" companies for the scams that they are, and they also sent out a woman to randomly approach people doing their shopping, "assess" their purchases for carbon emissions (by randomly throwing out numbers) and then ask them to pay for the environmental damage. Most people seemed glad to fork over the cash.
Why so defensive? All that is certain is that a few Slashdot posters question the wisdom of a carbon credit exchange. You can be a global climate change acolyte and yet refuse to support capitalization of it, can you not?
Gamingmuseum.com: Give your 3D accelerator a rest.
I think the idea of cap and trade is that we need to drasticly cut emissions. The problem is it is hard to come up with a fair way for requiring all of the major polluters to cut emissions. The hope with "cap and trade" it that the free market can be used to fine-tune the original political decisions. If one major emitter finds it is prohibitively expensive to cut emissions because they are actually increasing production, they can buy credits on the carbon market. The hope is that industries with little growth may be able to accelerate equipment upgrades with funds from those industries growing faster than equipment upgrades help.
Of course, until every major government implements strong carbon caps, the carbon market is a shell game. Currently here in Canada they are still talking about "intensity-based targets"; that is to say: carbon releases are allowed to increase as long as there is economic growth. There is also the issue of using hard-to-measure things as "carbon sinks" such as forests. If a framer has a small forest they are being paid credits for; are the expected to pay back all that money if the forest burns down, releasing a lot of carbon?
You're assuming that it's equally easy for all companies to cut down on carbon emission, and that the total carbon credit can't be altered. Assume that the number of credits is inadequate to allow all companies to do all the carbon emission they want. Somebody's going to have to cut down in this case, which is the desired outcome.
Now, suppose that there's one company that finds it cheap and one that finds it expensive. The cheap one will cut down and sell its carbon credits to the expensive company. The economy is therefore reducing carbon emissions to the set limit in the most economical way possible. As time goes on, the number of carbon credits can be reduced.
There's lots of complications, but overall it's an economically valid approach.
"When you have eliminated the unacceptable, whatever is left, however improbable, must be the truthiness" - Holmes
Here's the catch: if it would cost you less to update your equipment to produce less emissions, it would also probably cost your buyer less to upgrade their equipment than it would cost to buy the credit, so they will not buy the credit.
This is only true if production is occuring in the same way. For example it may be cheaper for a steel mill to support expansion by investing (purchasing credits) making a plastic manufacturer more efficient.
Thus, the only possible long-term effect of cap and trade is that companies who would have upgraded anyway will do so, but will now be able to sell their credits, allowing other companies to produce more pollution than they would have been able to produce under a strict system of caps.
Currently industries can expand without regards to environmental impact since there is little cost impact. Creating a cap sets a limit to how much pollution can be released. The only way for an industry to expand is to become more efficient, or to offset its output elsewhere in the economy. The overall result is net pollution remains the same or is reduced.
It's not sustainable to have uncontrolled growth ignoring the negative environmental effects. Not that cap & trade is perfect, but it does provide market flexibility that traditional government controls don't have.
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What is it with all the global warming deniers?
What's a "global warming denier"? Is that like holocaust deniers? Is this some group of anti-Semitic racists? Or is denying that genocidal events in history ever happened now no worse than denying a vague prediction of events in some future probability?
"Somebody has to do something. It's just incredibly pathetic it has to be us."
--- Jerry Garcia
Denying Climate Change is exactly like denying that you have cancer when your oncologist tells you that you do. It's easier on yourself to consider this reaction as scepticism, although you know that if you were really sceptical you would seek a second opinion rather than simply going home and ignoring the symptoms.
Understanding this reaction as denial helps the rest of us to see that these people are not insane, not necessarily dumb, and not necessarily evil - it is just taking them a little longer to work through the cognitive coping process. Also the term is a useful counter to the labelling of this reaction as scepticism - a term used deliberately to imply that it is the role of those who accept climate change to convince those who do not (a obviously absurd notion, when stated explicitly, which is why that rarely happens).