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The New York Times continues to prove its journalistic value in the realm of today’s most important topics, notably with regard to the environment:

KEWAUNEE, Wis. — Bryan T. Pagel, a dairy farmer, watched as a glistening slurry of cow manure disappeared down a culvert. If recycling the waste on his family’s farm would help to save the world, he was happy to go along.

Out back, machinery was breaking down the manure and capturing a byproduct called methane, a potent greenhouse gas. A huge Caterpillar engine roared as it burned the methane to generate electricity, keeping it out of the atmosphere.

The $3.2 million system also reduces odors at Pagel’s Ponderosa Dairy, one of the largest in Wisconsin, but it would not have been built without a surprising source of funds: a California initiative that is investing in carefully chosen projects, even ones far beyond its borders, to reduce emissions as part of the battle against climate change.

“When they came out here and told us they were willing to send us checks, we were thrilled,” Mr. Pagel said.

California’s program is the latest incarnation of an increasingly popular — and much debated — mechanism that has emerged as one of the primary weapons against global warming. From China to Norway, Kazakhstan to the Northeastern United States, governments are requiring industries to buy permits allowing them to emit set levels of greenhouse gases. Under these plans, the allowable levels of pollution are steadily reduced and the cost of permits rises, creating an economic incentive for companies to cut emissions.

The system encourages companies to find the least expensive ways to make the cuts, either by adopting cleaner energy technology or by investing in outside emission-control projects, like the Pagels’ methane digester.

Congress rejected a national plan of this type during President Obama’s first term, but 10 states, including most of those in the Northeast and mid-Atlantic, have developed their own programs. And the approach is expected to get a huge lift on Monday when Mr. Obama unveils a long-awaited national plan requiring states to lower their power plant emissions. One likely effect will be to encourage more states to adopt systems like California’s.

Already, the approach is spreading worldwide, with the number of people living in places that have such a system nearing one billion, or 14 percent of the world’s population, including about 80 million Americans.

“The point now is to say, look, this can work, it can be scaled, and please join,” said Frank A. Wolak, an economist at Stanford University.

Yet in the decade it has been used to tackle global warming, this approach has had a turbulent history. The world’s largest such system, in Europe, has had severe problems, including gyrations in the prices that polluters have to pay. Given a lack of evidence that the system can actually solve the emissions problem, some environmental groups and scientists have developed serious reservations.

“The reason I don’t support what we’re doing is not that I don’t think something needs to be done,” said Myles R. Allen, a leading British climate scientist at Oxford University. “I just don’t think it’s effective, and I don’t see it ever being effective.”

Drought-plagued California, which Gov. Jerry Brown recently called the “epicenter” of climate change, hopes to prove that capitalism can work in the fight against global warming. The state took great care in setting up its system, which is now being seen as a global test case…

Read the whole article here.