Once upon a time I supported the Emissions Trading Scheme because the theory was good. If you cap overall emissions, and allow emitters to trade their allocations among themselves, it creates an incentive for emissions reductions. The cap could then be gradually lowered, giving us a stable pathway to a low-carbon future.
Of course, it didn't work out like that. Labour packed the scheme with pork to try and buy off polluters, and then National made it even worse, turning it into a polution subsidy scheme which actively incentivised new emissions. As for an incentive to reduce, that would require that there be fewer emissions units than the amount people wanted to emit. Instead, we have the opposite: in Parliament today, the Greens Dr Kennedy Graham revealed that we have an annual supply of 85 million units - around 5 million more than our total annual emissions. Meanwhile, due to exemptions and exclusions, the total annual demand is only 15 million units. And if that wasn't bad enough, the government has just issued 30 million more...
This isn't a policy anymore - its simply a bad joke. And when fixing it means cancelling 5/6ths of the units in circulation (with all the attendant whining about property rights), I don't think its even salvageable. At this stage, regulatory controls are looking like a bloody good idea...