Emissions Charges:

Emission charges differ from fines in that they do not imply illegal activity and are usually based on graduated amounts related to the volume of emission (not necessarily in a linear relationship). A variant on this theme is creating a market to sell pollution "rights";

There is considerable discussion of creating international markets for pollution "rights" which, if implemented, would very much effect the Region because in many East Asian nations (especially the less economically developed ones), high marginal gains can be made in reducing pollution through relatively low investment ,e.g., through reduction of power transmission losses which feeds back into reduced fossil fuel burning.

A key area for assessment in terms of emission charges is extent of compliance or potential compliance. (In many East Asian countries, this approach would not prove practicable, even for larger firms, because of the lack of a sufficient number of inspectors. For example, the number of waste water inspectors in the Ministry of Industry, Thailand, is under 100.)

A second key assessment area is the relationship between the emission fees and behaviour. Are the fees leading to change in behaviour or are they so low that firms readily pay them rather than considering reducing emissions? From an economic perspective, are the fines too low to cover the true economic cost of emissions; or conversely, are they so high so as to be uneconomic (forcing desired industry out of the jurisdiction in question).

Reference: Synthesis study on Modalities for Environmental Assessment for Integrating Environmental Considerations into Economic Policy Making Processes: East and Southeast Asia, ESCAP, 1998, unpublished.