Russia Hopes to Clean Up on Its Dirty Past

For signing a global emissions treaty, Moscow wants right to sell its unused 'pollution quota.'

Russia, notorious for systematically poisoning its environment in the Soviet era, hopes to make a windfall out of the sale of clean air.

Adapting to free-market thinking, Moscow wants other countries to buy part of its air-pollution quota under a global environmental treaty. Russia's quota will not be used fully, mainly because of the collapse of the country's industrial sector.

Russia is making the right to sell its share of pollution credits a condition for official approval of the Kyoto Protocol. This agreement was reached at a conference in Japan last December, when 38 industrialized countries committed themselves to reduce emissions of toxic gases in an effort to fight global warming. They decided, in principle, to set up a market where countries could sell unused pollution allotments to other nations that emit more than agreed. The protocol is to be signed before April 1999.

Russia supports efforts to lower the emission of fumes such as carbon dioxide, but "there must be some financial profit ... in order to sign the Kyoto Protocol," says Sergei Kurayev, director of the Department of International Cooperation at the Environmental Protection Ministry in Moscow.

Covering one-seventh of the world's surface, Russia is its second-largest polluter after the United States, and Moscow's support is crucial for the protocol to work. Fully aware of its strategic position, Moscow is trying to turn the treaty into a cash cow of potentially billions of dollars.

The price of a metric ton of marketable pollution has yet to be determined, but could be anything from a few dollars to $50, experts say. Negotiations on the quota market are currently under way between some protocol partners, such as the US, Russia, Australia, Japan, Canada, Norway, and Ukraine. A special conference devoted to creating the market is scheduled for November in Argentina.

Setting up the market is a highly complicated task, negotiators say. "We need to come up with a system of shares, of certificates, with brokers, with a stock exchange," Mr. Kurayev says.

Some environmental organizations have their doubts whether the market would function properly if and when it is established. "The quota trade is like trade in real estate on the moon," says Greenpeace Russia spokesman Yevgeny Usov.

The trade in toxic gases, a topic of great tension in Kyoto, is supposed to reward clean industries and serve as an incentive for dirty companies to invest in better technologies. The system is to help realize the aim of the Kyoto Protocol - to emit in the year 2010 only as much as the world did in 1990. But the trading system will not reward Russia for its efforts to cut toxic emissions - because there are hardly any such efforts. "It will indeed reward Russia's dirty past," says a Western diplomat who asked not to be identified.

Before its collapse in 1991, the Soviet Union was a heavy polluter. Precise quantities are unknown, but Russian officials estimate that the output of toxic waste has dropped 30 percent to about 1 billion metric tons since 1990. This decline is directly related to the Soviet breakup, the end of state subsidies, and the collapse of the economy.

Looking after the environment is not a priority in a country where millions are unemployed. Here, dilapidated factories use antiquated technologies, smoking chimneys are a sign of prosperity, and chemical experts say toxic waste is dumped next to housing areas.

Russia's Economic Affairs Ministry sees the economy growing again in coming years - and with it, pollution levels. The Environmental Protection Ministry estimates that the country's toxic gas output in 2010 will be back at 1990 levels, so Russia will adhere to the Kyoto norm. But officials calculate that before then, Russia will emit some 2 billion metric tons less carbon dioxide than its quota allows.

It's still unclear whether any money received from the sale of toxic tons must be spent on environmental improvements or if it can be used to serve the government agenda. If Kurayev had his way, the money would be reinvested in projects such as planting trees, cleaning polluted areas, or upgrading factories with cleaner technology.