The cap-and-trade approach to pollution reduction means a permit holder not using its entire allocation can save credits for future expansion.

Question

Quizplus · Accepted Answer

This is true. In a cap-and-trade system, permit holders who reduce their emissions below their allocated limit can sell their unused allowances to other companies who need them to comply with the set limits. This encourages companies to reduce emissions further than their allocated limit and rewards them for doing so.

The Cap-And-Trade Approach to Pollution Reduction Means a Permit Holder