Industrial ecology and carbon property rights

This paper examines the potential for property rights in carbon to affect industrial ecology opportunities. Given that emissions trading schemes for greenhouse gases are becoming more widely implemented, the definition of the carbon property right can affect barriers and opportunities for industrial ecology, alongside other factors. The paper uses legislation for emissions trading in Australia and two possible scenarios for the future of energy generation in the Latrobe Valley, Australia in 2050 as an illustrative case study to identify issues for industrial ecology arising from ill-defined carbon property rights. Currently, electricity generation in the region is reliant on coal-based generators. Scenario one focuses on bio-industries and renewables with no coal usage; and scenario two focuses on electricity from coal with carbon capture and storage resulting in moderate to high coal use. If a carbon property right for soil carbon emerges before a property right for subterranean carbon, then bio-based industrial ecology opportunities could be enabled ahead of a regional symbiosis involving carbon capture and storage. A generalised framework for considering the intersection of industrial ecology and carbon property rights is presented with a focus on tensions in: contributing to sustainable development, system boundaries and finally exchange mechanisms.