Trading in Carbon

Here in New Zealand motorists are reported to pay up to $25 per metric ton of carbon when they fill their cars with fuel.  Some sources report that the open market cost for carbon credits is just over $13 per ton.  The fuel supply companies are effectively making a 100% markup on carbon credits on the face of it.  This is similar to governments making money trading in carbon credits.  

As a simple man with a desire for simple explanations, I find it hard to understand why there is a trade in carbon credits.  Yes, I know all about global climate change and the smarty pants scientists putting evidence on the table that we are the cause of the impending doom.  But how does this trading scheme work, if it trades in the unseeable and unmeasurable based on sketchy science?  Why are we going along with it?  Is it because we have been kicked into submission and guilt?

Let’s just look at this quickly using round numbers:  one liter of automotive fuel (C₈H₁₈) weighs about 700g (equal to about 6.2 mole of fuel) and reacts with 2.4kg oxygen to form about 2.2kg of carbon dioxide (CO₂), which translates to about 600 gram of carbon.  This means that for an average tank of fuel used (50 liters), you produce about 30kg of carbon, and this translates to about 75 cents per refill.  Or you could pay about 38 cents, if the fuel companies did not rip you off.

I maintain that this is fruitless expenditure.  Where is the money going to?  You see, I see 1.5 cents per liter disappear from my wallet.  That is REAL.  I use about 800 liters of fuel per year in the one car we use.  Obviously I also consume fuel when I take the bus or the taxi cab.  I have no idea how much that is.  So let’s just work on 1000 liters to make the case here.  That is $15 per year.  Insignificant!  Maybe we are playing along because in the bigger scheme of things this is of no consequence....

But wait, there is more.  Wolfram Alpha reports that there were 3.1 million vehicles in use in New Zealand in 2006.  Assume there are about 4.3 million people living here.  Just for now, assume there is a steady growth in vehicles and that it came to about 3.5 million vehicles this year.  As a very conservative assumption, assume all these vehicles have similar patterns of use to mine, then we use about 3.5 billion liters of fuel per year. That comes to $52M of carbon tax.  $52,500,000!!!  Not shabby.

If I now ask where that money is going, I think I am asking an important question.  Let us take this further.  I can buy a large beech tree for about $15 (Fagus Sylvatica Purpurea).  This tree will conservatively sequestrate about 15kg of carbon per year in the climate of the South Island.  One tree will sequestrate the carbon delivered by using about a half a tank of fuel.  As I am generating 600kg of carbon per year, I need to have  40 healthy beech trees somewhere to sequestrate my carbon production from using typical transport.     That comes to an investment of $600.  These 40  trees will stand there and consume carbon for the rest of my natural life.  The 3.5 million vehicles need to have the same sequestration, so let’s make it easy and say that we need to invest $1000 per vehicle.  That comes to $35B once-off.  I hope my math is right, because it says that we can sequestrate the carbon we produce in New Zealand from using cars and trucks by investing about $35B in trees.  That is 670 times what we pay in tax per year.  

I assume a tree like this will need 10m² to flourish (I do not have a lot of information on this, so maybe someone can comment).  I need 400m² planted with these trees.  Nothing else, just the the 40 trees.  Make that 500m² for the sake of my argument.  The total perennial crop area of New Zealand is about 1.8 million hectares.  I have 36 million spots available for my trees to sequestrate my type of fuel consumption.  Sure, we also need to produce other crops, but they do their bit in cleaning up carbon too.  

Back to maths.  We need to clean up 3.5 billion liters of fuel derived carbon.   One tree does 15kg of carbon which is generated by 25l of fuel.  Therefore, we need 140 million trees, or about 140 000 hectares covered in trees.  That is less than 10% of the perennial crop area covered in trees or similar carbon sinks.  I hope my math sucks big time.  

I am worried that we do not attempt the maths, that we do not ask the questions and that we do not take our governments to task on this.  A once-off payment of $35B will cover us for a few years (say 10).  That comes to $1 extra per liter, or $1000 for every vehicle.  This is what we need to pay to pay for the carbon pollution, if that argument holds.  I see no trees being planted.  Will I be exempt from tax if I plant 40 trees?

So why are we paying $52M per year?  It is not enough to make a difference.  Where is the money going?  Are we the generation that is guilt ridden and ripped off because we choose to be ignorant?  Please check my math.  I try to spend no more than an hour per blog entry, which means I my me mistaken here.  If I am right though, we should be asking a few questions.

(Image used under the Creative Commons License - see http://www.freefoto.com/preview/15-19-15/Tree)