As discussed in this chapter, by all accounts the US acid-rain program has been hailed a success at reducing emissions of SO, and NO, from power plants. The reason for its success is largely attributed for its use of market based instruments; namely, the emissions trading scheme. Furthermore, the emissions trading program has been enhanced by the use of the offset, the bubble, and emission-banking policies.

(a) Do you agree with the overall assessment that the US acid-rain program has been successful?

(b) Explain how the offset, the bubble and the emission-banking policies, taken separately and in combination, might have contributed to the further enhancement of the overall efficiency the US sulfur emissions trading program. Be specific.