Glossary of Terms

Cap-and-Trade program: A market-based approach to reducing greenhouse gas emissions. For example, EPA caps, or limits, the total annual emissions of CO2 equivalents. The cap is divided into emission allowances that are allocated to each emitting entity. Some allowances may be retained for auction purposes. Each emission allowance represents an authorization to emit one ton of CO2 during a given year. To demonstrate compliance, the entity is required to hold a number of allowances greater than or equal to its emissions in the regulated time period. Since the total number of allowances allocated or auctioned off to the emitting entities is less than or equal to the target level (cap) of emissions, the program controls the emissions of the greenhouse gases. The allowances are traded at market-based rates so that an emitter of a ton of CO2 either needs to:

• hold and use an allowance that was allocated for free from EPA, or
• purchase and use an allowance on the market or at auction, or
• obtain a certified offset credit (like for qualifying tree-plantings that remove CO2 from the atmosphere) in lieu of holding an allowance.

On the other side of the market, a holder of an allowance may avoid the associated emission and sell the allowance in the market for its market price.

Carbon dioxide (CO2): A colorless, odorless, non-poisonous gas that is a normal part of Earth’s atmosphere. Carbon dioxide is a product of fossil-fuel combustion as well as other processes. It is considered a greenhouse gas as it traps heat (infrared energy) radiated by the Earth into the atmosphere and thereby contributes to the potential for global warming. The global warming potential (GWP) of other greenhouse gases is measured in relation to that of carbon dioxide, which by international scientific convention is assigned a value of one (1).

Carbon tax: A type of energy tax that has become a frequent topic of discussion in environmental protection. Levied on fuels based on their carbon content and intended to limit emissions of carbon dioxide, carbon taxes have been adopted in Denmark, Finland, the Netherlands, Norway, and Sweden. Carbon taxes are generally small relative to other fuel taxes, although the relative size of the carbon tax varies according to the type of fuel. Rates often vary depending on the sector or use of the fuel. In Finland and the Netherlands, the taxes are assessed partly on carbon content and partly on energy content.

Climate change: A term used to refer to all forms of climatic inconsistency, but especially to significant change from one prevailing climatic condition to another. In some cases, “climate change” has been used synonymously with the term “global warming”; scientists however, tend to use the term in a wider sense inclusive of natural changes in climate, including climatic cooling.

Fossil fuel: A hydrocarbon deposit, such as petroleum, coal, or natural gas, derived from living matter of a previous geologic time and used for fuel.

Global warming: An increase in the near surface temperature of the Earth. Global warming has occurred in the distant past as the result of natural influences, but the term is today most often used to refer to the warming that some scientists predict will occur as a result of increased anthropogenic emissions of greenhouse gases.

Greenhouse gases: Those gases, such as water vapor, carbon dioxide, nitrous oxide, methane, hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) and sulfur hexafluoride, that are transparent to solar (short-wave) radiation but opaque to long-wave radiant energy from leaving the Earth’s atmosphere. The net effect is a trapping of absorbed radiation and a tendency to warm the planet’s surface.

Hydro Pumped Storage Facility: A type of hydroelectric power generation used by some power plants for load balancing. The method stores energy in the form of water, pumped from a lower elevation reservoir to a higher elevation. Low-cost off-peak electric power is used to run the pumps. During periods of high electrical demand, the stored water is released through turbines.

Methane: A colorless, flammable, odorless hydrocarbon gas (CH4) which is the major component of natural gas. It is also an important source of hydrogen in various industrial processes. Methane is a greenhouse gas.

Nitrogen oxides (NOx): Compounds of nitrogen and oxygen produced by the burning of fossil fuels.

Nitrous oxide (N2O): A colorless gas, naturally occurring in the atmosphere.

Regional haze: Regional Haze is defined as visibility impairment that is caused by the emission of air pollutants from numerous sources located over a wide geographic area. In 1977, the Federal Clean Air Act set a goal to remedy any existing visibility impairment, and prevent any future impairment, from manmade pollution at 158 national parks and wilderness areas across the United States.

Scrubbers or Flue Gas Desulfurization (FGD): A technology used for removing sulfur dioxide (SO2). There are several types of scrubbers including wet scrubbers, which use a slurry of sorbent, usually limestone or lime, to scrub the gases; and dry scrubbers which use a dry sorbent injection system.

Selective Catalytic Reduction: Removing nitrogen oxides (NOx) through a chemical reaction between the exhaust gases, an additive and a catalyst.

Sequestration (of carbon): The fixation of atmospheric carbon dioxide either through biological processes (e.g. plants and trees), or geological processes through the storage of CO2 in underground formations.

Sulfur dioxide (SO2): A toxic, irritating, colorless gas soluble in water, alcohol, and ether. Used as a chemical intermediate, in paper pulping and ore refining, and as a solvent.