Environmental effects of SO2 trading and banking

The widely acknowledged innovation of Title IV of the 1990 Clean Air Act Am endments is sulfur dioxide allowance trading, which is designed to encourag e the electricity industry to minimize the cost of reducing emissions. Few studies have examined the environmental effects of trading, and none have e xplored the effects of banking. We used an integrated assessment computer m odel, the Tracking and Analysis Framework, to evaluate changes in emissions of SO2, atmospheric concentrations of sulfates and deposition of sulfur, a nd public health benefits from reduced exposure to SO2 and particulate matt er. We assessed geographic and temporal changes at the state level that res ult from trading and banking and compared them with estimated cost savings. Our findings are not consistent with the fears of the program's critics. I n the East and Northeast including New York State, an area of particular co ncern, we found that health benefits increase and sulfur deposition decreas e slightly as a result of trading. Nationally, trading results in health-re lated benefits in addition to significant cost savings. Banking changes the timing of emissions, but the geographic consequence of banking is varied.