No Impact Man Opens in Washington

No Impact Man opens at the E Street Cinema in Washington this Friday, September 25.

Age of Stupid Premieres Tonight

I'll be attending a simulcast in Arlington VA of the New York premiere tonight. Hope you can, too.



Age of Stupid Website

The Buffet Line Effect. For Best Results Go Straight to the Dessert Table

When there is a breakdown or a disabled car or another problem with the Metrorail system, it creates a logjam of trains, because it is difficult or impossible to reroute the trains that are behind the incident. Once the issue is resolved, the trains continue to follow each other one by one, because of the limitations of having just two tracks.

The first train, though is the slowest train. It immediately becomes crowded with a crush load of passengers and then encounters overcrowded platforms. People take longer to board and deboard; each stop becomes a two-minute drill to deboard and board about 20 or 30 people. In many cases the vast majority of people on the platform can't even get on and have to wait one or two or three trains to finally board. It can take a couple of hours for all the trains to move through the system and return service to normal.

I have coined the term "Buffet-Line Effect" to describe this phenomenon. This comes from my observation that in a restaurant buffet line, the line moves not at the speed of the average diner, but at the speed of the s-l-o-w-e-s-t diner. Everyone backs up behind the one person who is carefully scrutinizing each and every offering. Relief finally comes when they move off to the dessert table and the whole line speeds up.

The simple and easy solution to the Buffet Line Effect is to express the trains after a delay. There are miles of empty track in front of the first train (and lots of filled platforms). If the trains that are backed up are expressed to fill in the empty space, then normal service can return within minutes rather than hours.

This will, of course, inconvenience some passengers who may have their stations skipped and either have to deboard and get on a later train or backtrack to their station. However, I believe that the overall savings for passengers will be much, much larger than the inconveniences.

Given the capacity stresses Metro is experiencing on a regular basis, simple, no-cost solutions like these need to be part of their short-term strategy.

To do this well, though, requires two things: intelligent dispatching and excellent communications with passengers. Let's try an example:

Assume a breakdown at Gallery Place on the Red Line to Shady Grove. A mechanical breakdown causes a 20-minute delay and a train is taken out of service. There are now 5-6 trains backed up behind, probably out past Union Station. The track is empty from Gallery Place out to past Friendship Heights, and the platforms are filled to overflowing in the downtown area.

First train: Skips Metro Center and stops at Farragut North (which has a center platform). The dispatcher has been alert and makes sure a train going the other way arrives immediately or is waiting for this train. Riders for Metro Center can choose to wait at Gallery Place or backtrack from Farragut North. Train then expresses to Bethesda. [NOTE: The train operator clearly and constantly communicates to his/her passengers throughout this whole process, allowing everyone to make decisions about how they are going to deal with it.] Train immediately arrives or is waiting at the platform in Bethesda for passengers to backtrack.

Second Train: Services Metro Center (at the same time the first train is servicing Farragut North) and then expresses to Van Ness (with a center platform). Similarly, the dispatcher makes sure there is a reverse train ready to take passengers back.

Third Train: Services Judiciary Square (at the same time as the others are at MC and FN), skips Gallery Place and Metro Center and services Farragut North like the first train. Dispatcher makes an informed decision about skipping another stop to create breathing room behind or allowing train to proceed as usual. If this train is going to create its own "buffet line effect," then it should express ahead to allow the faster trains behind to proceed normally.

Fourth train: Services Gallery Place and Metro Center and proceeds normally from there, possibly skipping Farragut North if the third train skipped DuPont and created space (and also to get the riders at DuPont, who have now watched three trains go by).

So how about those riders at DuPont who watched three trains go by? In the Metro Universe we inhabit now, most of them would have had to wait for two or three trains just to board. And those trains would have been progressing at "buffet-line effect" speed. In the end, they probably reach their destination just as fast. The overall system is returned to close to normal service within fifteen minutes, with trains more evenly spaced along the tracks rather than bunched together behind a dysfunctional, overcrowded train. It helps to imagine the system from above. Imagine 8 miles of empty track followed by a "buffet line" bunch of six trains clunking along at half speed. Absurd.

Obviously, the exact way to deal with any delay will vary every time, based on how long the delay is, time of day and other variables. This is why it requires intelligent dispatching to maximize the value. It requires on-the-spot decision making.

The other requirement, in my opinion, is courage. If Metro were to put this into effect, they need to do so consistently for a solid six months or longer, to allow riders to get used to it and to realize that they are actually getting better service than the current dysfunctional way of dealing with delays. They have to have the courage to stand up for the vast multitudes who save five or seven minutes against the vocal few who might lose fifteen or twenty on a single occasion and then complain. I don't know if Metro has the courage to do that.

Earth Days movie trailer

I'm planning to go see Earth Days movie when it opens in DC next week.


It's already playing in some other theaters around the US. Click here to find out if there's one near you.

Better Bike Parking

Not long ago I took my "toodler" bike over to Falls Church to meet someone for lunch at Panera Bread. It was overcast and threatening rain, so I didn't want to leave my bike out in the open. There's a newly constructed parking garage, so I went in looking for the bike parking. I didn't find any, but as I came out I saw the rack pictured to the left.

As you can see, although it has a nice little nook location, it is located under the open sky, so it was going to be rained on. Putting car parking under the open sky is not a problem except for convertibles. But all bikes are "convertibles," so we cyclists really appreciate having parking that is out of the elements if at all possible.

In this case, it is possible. This is where I parked my bike instead, so it would be out of the rain. I locked it to a pipe. This is in "dead space" that is too small or the wrong size or shape to be used for automobile parking. All garages have dead space, and a lot of it could be used for bike parking. This seems like a natural spot for placing some racks: it's inside--out of the elements, there's plenty of room, it's near the entrance, easy to find and well lit.

Swine Flu vs. Climate Change: Where are the Skeptics?

The US is developing a $9 billion campaign to vaccinate Americans against the H1N1 virus, also known as swine flu. There's a lot of uncertainty about how extensively swine flu will manifest among the population, it's likely severity and how well the vaccination might work. However, none of those uncertainties has stopped us from working hard to develop the vaccination and the program to deliver it to millions of people. Why? Basic risk management. The possibility that the pandemic could be severe and affect millions of people are sound reasons to make significant investments to try to reduce that risk.

I haven't heard about a single Congressman or Senator railing against making this investment to ward off a potential future threat. But aren't some of these the same politicians who tell us that we shouldn't be taking action against climate change, because of uncertainties about how it will manifest, it's likely severity and how well solutions might work? The reason we need to take immediate action on climate change is exactly the same as the reason we are taking immediate action against H1N1: it's because risk management to reduce the risks of potential catastrophe tells us to do so. I searched several of the web sites of the most outspoken Senators against climate change to see if they had similar stands against addressing swine flu and found nothing. Am I the only one who sees this hypocrisy?

To see more on looking at climate change through a risk management lens, watch this video:

Pocket Bus Schedules

The Arlington neighborhood called Westover is a neighborhood about a mile east of the East Falls Church Metro and about 1.8 miles west of the Ballston Metro. It is centered on a group of neighborhood shops: Lost Dog Pizza, Lebanese Taverna and Ayers Variety Store among others. The #2 Metrobus runs directly through the center to both Metro stops, although the majority of riders I've seen take the bus to Ballston and then transfer to Metrorail there (or Ballston is their destination). I think this is a good example of two nodes that would benefit from a simple, easily accessible and usable schedule.

Arlington Transportation Partners, which provides transportation information throughout the county, stocks schedules and maps in one of the local establishments. I have noted that whenever the #2 Metrobus schedule is stocked they immediately get snatched up, while the other schedules and maps tend to languish longer. However, almost all of the information in that schedule is extraneous to most of these users. All they really need to know is when the bus is going to Ballston and when it's returning. I suggest that a very simple, easy to use pocket schedule would be a powerful tool for riders between these two nodes. It could look something like this:

If designed to be the size of a business card folded once, it would easily fit in a wallet. There's no need for a map or a lot of other destinations or really anything else. It would serve most of the people who might ride the bus to or from the Westover area. It's so easy, it might lure people who pick up one of these schedules at the ice cream shop to consider taking the bus.

There are certainly dozens of these nodes that directly connect two locations together and are highly used. A couple obvious ones to me are Shirlington-Pentagon and Shirlington-Ballston. Especially now that Arlington has built their nice, new transportation center in Shirlington, providing riders with really easy pocket schedules would be a great boon for users. There are several different routes that serve these points, so having a concise, combined schedule would simplify information and make it more accessible.

One of the big barriers to people riding the bus is they don't know when it comes. NextBus is one tool to help with that, but it doesn't tell me when I can get back. It also doesn't help me with, say, tomorrow. The WMATA web site can, but a pocket schedule like this requires no computer, no smart phone, no Internet connection and is probably way faster than any of those. It can sit on the counter of a coffee shop and be tucked in a wallet and used immediately.

I imagine there are scores, if not hundreds, of these highly used node connections. Would it make sense to print all these individual pocket schedules? Maybe not a bad idea. By being enterprising, this might be a good way to get more people on the buses while partnering with local businesses. Why not get a local business to sponsor the schedules to offset the costs? They could pay for the printing, which would be a relatively low-cost advertising vehicle, and they would get a little space on the pocket schedule for their marketing message. It's highly geographically targeted marketing, since the only people who would be interested in that particular pocket schedule are those who travel to or from that one location.

While Metro is spending millions on rail cars and infrastructure maintenance and upgrades, and billions on a new rail line, there are truly low-cost/no-cost measures that can make the system run better. I've proposed a couple in the past (the Farragut Virtual Tunnel and A/B rush-hour service). This is another of those. Intelligently done, these simple little pocket schedules could be provided for free (both to passengers and for Metro) to thousands of riders and make riding the bus way easier.

(cross posted on Greater Greater Washington)

A Little Irony and Humor in the Washington Post

I had a letter to the editor published in today's Post in which I responded to this article:

Man Challenges Ban On Fortunetelling: Self-Described Gypsy Who Wants To Open Shop Says Law Is Biased

Here's the text of my letter (link here):

Crystal-Ball Economics
Thursday, August 20, 2009

I read with interest the Aug. 17 story that Montgomery County outlaws fortunetellers ["Man Challenges Ban on Fortunetelling," Metro]. Then I did a quick Internet search and found dozens of economists with offices in Montgomery County. What gives?

STEVE OFFUTT
Arlington

Carbon Tax vs. Cap and Trade - in the Washington Post

Today's Washington Post included an op-ed entitled
Cap and Rage: the fight over health-care reform could hobble climate-change legislation.

I recently heard John Kerry speak at the National Press Club (for those of you who follow me on Twitter, I tweeted a few times from this event). He made a statement that caught me and some of my fellow climate change battlers off guard. He said he thought climate legislation might get pushed to 2010 due to the fight over health care. This Post op-ed supports that possibility.

The US must, must, must show leadership in advance of Copenhagen. Time is running out. I am not confident, but hope that I am proved wrong. As the op-ed points out, the Waxman-Markey bill became bloated and overgrown. Personally I support it, because we must take action, and I maintain the hope that it would be improved over time. Having it fail would have been much worse than having it pass. However, the Senate may not find the time and wherewithal to take on the task, and that would be a catastrophe for international negotiations.

The Washington Post suggests dropping the cap and trade provision and instead instituting a simpler carbon tax. A carbon tax would be much simpler (although left to Congress, I'm sure it could be made wicked complex) in practice, but likely much more difficult politically.

Although I have been a long time supporter of market mechanisms as intelligent strategies to encourage innovation in private markets, I would also support a carbon tax (in fact, I'd support both--why not?). In fact, I'll support just about anything that shows the US wants to move forward on seriously addressing climate change. It's also the sensible thing to do purely from a responsibility standpoint, as pointed out by Jim DiPeso here.

Let's do something--anything--to show that the US understands the serious implications of inaction.

Demographics, Declining Populations and Our Environment

Occasionally I encounter an article that discusses the demographic catastrophe that is befalling one or more of the developed nations that has a declining population, such as Japan or Italy. These articles rightly point out the problems that a population with a growing number of elderly and a smaller number of young people encounter. The economic systems that have been developed in most developed countries were created in the context of a small elderly population and a large young population. As this changes, these economic systems cease to function properly.
Yesterday's Washington Post had a similar article. The New York Times ran a long article last year on this topic.

This Post one had an interesting twist, however. It reported on research that seems to indicate that some highly developed nations are reversing the trend that as a country becomes more developed the lower its birthrate. The journalist and those quoted in the article universally praise this as a positive: "Now, however, new research has produced the first glimmer of hope that economic prosperity may not be linked to an inexorable decline in fertility."

Never once have I read one of these articles that also looks at the big picture of how the long-term demographics affect our environment. They tend to focus entirely on economics. Yet this is absurd. Even if you do not believe that the 6.7 billion people on the planet are already straining our planet's sustainability, adding more and more indefinitely into the future just to support an unsustainable economic system is impossible. Even if we were to achieve the replacement rate of 2.1 children per woman that sociologists and economists tout, our population would still grow from demographic inertia for a while. Then we'd end up with a permanent population of 7-9 billion people. That's just too many.

What we need to be doing instead of trying to reverse these demographic trends is to learn from them. The experience of Japan and Italy is the experience that the whole world is going to have sometime later in this century. The UN predicts that population as a whole will peak in about 2050 and then start declining. This is good for our planet, but doesn't work well with our economic systems. So, hello! Let's start figuring out how to transform our economic systems to work with a shrinking population rather than pushing on the population to match our economic systems.

Listen, the population we already have has reduced fish catch by 90% over the last 50 years. Fisheries worldwide are collapsing. We've destroyed our ozone layer for about 100 years (thankfully it's healing). We're reorganizing our climate to the detriment of hundreds of millions. We've created the 6th great extinction. We've acidified our oceans. Etc. All of these problems are either created by or exacerbated by more people.

So, we need to embrace the idea of shrinking population, not wring our hands over it. We can either be deliberate about planning our future here on earth or we can let crisis after crisis dictate what happens to us. I for one prefer the more deliberate and thoughtful approach.

The Big Cap and Trade Flip Flop

Back when I was in grad school getting my MBA, I took an Environmental Law class. At the time, the Clean Air Act Amendments of 1990 were just getting passed in congress. Much of our discussion in class centered around the innovative policies that were being put in place to curb acid rain: cap and trade.

Most of the other students were those interested primarily in environmental issues--pursuing degrees in environmental law or energy or such. I believe I was the only student from the business school in the class.

I clearly recall being virtually the only vocal supporter of the emissions trading concept proposed for the Acid Rain Program and that had been proposed by, yes, the Republican George Bush (senior) administration. This idea of using markets to reduce the costs of curtailing pollution was a conservative idea, and liberals were strongly against it. The other students would claim that it just created a "license to pollute" and that it created some sort of sham system. Those, like myself, that like to see intelligently designed market systems do the work, supported the idea.

Fast forward to now. Virtually every right-wing think tank and pundit is decrying cap and trade for greenhouse gases as a disaster while the environmentalists are strongly supporting it. What happened? I'm no political scientist, so I'm just speculatin'.

First, we environmentalists have noted the enormous success of the acid rain program at even lower compliance costs than the most optimistic predictions at the time. I, for one, believe that creative market forces will make reducing greenhouse gases cheaper than many predictions. I also can forecast with confidence that not one of the predictions that claims even an order of magnitude of accuracy for events 10+ years in the future will be remotely close to the actual costs:
CBO - $175 per household in 2020
Boehner - $3128 per household in 2015. Not $3127.50, by the way. $3128. Gotta love that final 8 bucks!
EPA - $1100 per household in 2050.

I predict that all of these numbers will be wrong. In fact, I suspect we won't even be able to measure what the costs (or benefits) really are, because so many other variables will have made it impossible to figure out.

Second, partisan politics have overtaken good sense. Many Republicans, I believe, oppose cap and trade simply because it's the Democrats proposing it. (In fairness, partisanship in congress these days seems to run equally both ways.)

I know that if we can create a market-based system that rewards success at reducing greenhouse gas emissions, that we will succeed at reducing them. Is Waxman-Markey the answer? Not entirely, it's got a lot of problems, but the concept of cap and trade embedded within the bill is not one of them. The concept of emissions trading (cap and trade) is an idea that should be embraceable by both political parties. After all, it has been.

Virtual People; Real Energy

Wi-fi everywhere. Broadband Internet. On-demand video.

These are the technological features of modern life for many of us, and it gets harder and harder to imagine how we'd get along without them. Behind the scenes, though, an enormous amount of electricity is being used to provide these services to us. A recent report by Jon Koomey, an independent researcher associated with Lawrence Berkeley National Labs and Stanford University, estimates that it takes about 14 large power plants to power the world's servers. In the US, servers consume about 1.2% of all electricity generated, and that is expected to rise to 2% by 2010. (Geeks may read the actual report here.)

Amazingly, an online, Second Life avatar (a virtual person used in on-line gaming, for those of you unfamiliar) requires more energy (1700 kWh per year) than the average real-life Brazilian (1000kWh/yr.)!!

What can you do? For one, always turn off and power down your equipment when not using it. If you have a wireless router and/or high-speed modem at home, unplug it while you are away (most households leave these on 24/7. Why?). Both at work and at home, push the button on your monitor to turn it off, even if you are leaving your computer running for whatever reason (even though it uses only a little energy in standby mode, why not turn it all the way off? Your monitor isn't doing anything at all when you are not looking at it.)

You can also choose a green Internet Service Provider (ISP). E Magazine published an article in 2006 about green ISPs, and you can find others by searching the web.

Time to Ground the Washington Flyer

Travelers to and from Dulles airport probably wonder why there is a monopoly taxi service, the Washington Flyer, serving the airport. I am aware of only one other major US airport that has a monopoly taxi service. With rising concerns about climate change and the DC area's status as a non-attainment area for air pollution, the millions of empty miles taxis drive due to this anachronistic service need to be eliminated.

In 1962, when Dulles International Airport opened, it was located out in the middle of nowhere. There were legitimate concerns that passengers would not be sufficiently served by existing taxi services, so the airport created its own, which currently operates as the Washington Flyer Taxi (a monopoly service under contract to three different companies). Dulles is no longer in the middle of nowhere, and the original reason for the existence of the Washington Flyer no longer applies. Dulles is now surrounded by businesses and residential areas, and thousands of people arrive every day in taxis from all around the region—taxis which then leave the airport empty to return to Alexandria, DC, Montgomery County or wherever else they started from.

According to the Metropolitan Washington Airports Authority, Washington Flyer taxis provide 2,500 to 3,000 rides per day from the airport, but only provide 300 to 350 rides to the airport—that means more than 85% of return trips are made empty. It's probably a fair assumption that a similar number of people arrive at the airport by taxi as leave, so that means that more than 2,000 local cabs drop passengers at Dulles and then drive back empty. Let's do the numbers.

Assuming a 25-mile, 1-way trip on average, taxis to and from Dulles drive more than 100,000 miles per day empty. Per day! 38,000,000 miles per year. At 20 mpg and $2.25 per gallon, that's 2,000,000 wasted gallons of gasoline, costing taxi drivers more than $4 million per year for gas when no passenger is in their cab. Last summer, when gas prices were higher, drivers were paying more than $20,000 per day for gas to drive back empty to the airport or their home jurisdiction. Those wasted miles also contribute to our poor regional air quality and add 17,000 tons of carbon dioxide, the primary climate change pollutant, annually to our atmosphere.

The current situation benefits virtually no one, with the possible exception of the cab company owners, since monopolies are always a good deal for the businesses that have them. Eliminating the Washington Flyer taxi service will not change the fares paid by airport patrons: the same number of people will still be flying in and out of Dulles. Drivers, though, will save millions of dollars and thousands of hours of wasted time. It's likely this will reduce the need for as many drivers and taxis, but taxicab drivers as a whole will collect just as much in fares while saving millions of dollars on operating costs. Reducing this waste will also reduce the pressure to raise fares on customers while introducing competition may result in better service, too.

The Metropolitan Washington Airports Authority (MWAA) does not need to be in the taxi business. At DCA they manage the dispatching of the taxis without providing service themselves, so they already know how to do it.

I don't suggest canceling the current contract, but MWAA should start planning now for the transition out of the taxi business at the end of this contract. Eliminating the Washington Flyer will improve service, reduce waste and significantly reduce unnecessary air pollution.

Book on Cap and Trade

I have recently been contacted by a business publisher to write a book on Cap and Trade. This is an exciting opportunity, and I am both excited and humbled to take on this task.

UPDATE - As of late January, 2010, Bloomberg has gotten out of the publishing business, so this project has ended. I may be taking on another book project, so keep on eye on my blog.

I would like the help of my readers and followers. In order to make the book as useful as possible I need to know what the issues are that readers would like to have addressed. The book will not be a policy book; it will be a business book. With that in mind I would sincerely appreciate business people letting me know what they would like to see in the book.
- What are your questions about Cap and Trade?
- What are issues related to your business or industry that if you understood better would help you make better decisions?
- What other issues or questions do you feel are important to cover in a book on Cap and Trade?

Please provide me with your thoughts and ideas so that I can make this book as useful as possible. You may comment below or send an email to me directly at steve@offuttemail.com.

Thanks a lot for your help.

More Urban Canopy Using Market Mechanisms

I have been asked to present this idea at the 2009 Policy Greenhouse being sponsored by DC Councilmember Mary Cheh and hosted at George Washington University on Friday, July 10. I am pleased that my idea was accepted as one of eleven innovative ideas for achieving high impact environmental solutions.

The premise is simple: apply the concept of a Portfolio Standard (a kind of Cap and Trade) with market-price trading to the issue of urban canopy.

A couple of definitions:
- Urban canopy is the layer of trees, branches, leaves, etc. that cover the ground when viewed from above.
- Urban forest is the total system of trees and other plants that exist in an urban area.
- Cap and Trade is a system to limit something, such as a pollutant, by designating an overall cap and allowing all the parties under the cap to buy and sell. It's analogous to secondary market ticket sales for concerts or sporting events. The "cap" is the total number of seats available for the event. Generally once all those tickets are sold, then a secondary market is born on sites like StubHub to allow people with tickets to sell to those without. The total number of tickets does not change, but ownership of those tickets can.
- Portfolio Standard is the other side of the same coin as Cap and Trade, except instead of trying to reduce or limit something, we are trying to increase it. A minimum requirement is set and each entity has to meet or exceed that requirement--either directly or by purchasing enough "credits." A common use of this concept is a Renewable Portfolio Standard, in which a state or other entity requires that x% of the electricity generated will come from renewable sources.

What makes this concept attractive is that it creates an economic incentive to go above and beyond, because when one does, the extra environmental benefits can be sold to someone else in the market.

So let's apply this idea to urban canopy. Since my presentation is to the District of Columbia, I'll use data specific to DC.
According to American Forests, tree canopy in DC declined from 37% to 21% of the District's area between 1973 and 1997. Acres with 50% or more tree coverage declined from 37% to just 13% of the acres in the District. Most of those are probably in parks.(photos taken from the American Forests report cited above)
In contradiction to the American Forests report, Casey Trees estimates tree coverage as 36%, so a consistent methodology will need to be established.

Urban tree canopy provides numerous benefits, including:
- Reduction in the urban heat island effect--the effect that makes cities hotter than the surrounding areas. Buildings in urban heat islands require more energy to cool. Hotter temperatures also lend to greater production of ground-level ozone, also known as smog. Trees reduce temperatures two ways: through shading and through transpiration (the emission of water vapor from the leaves).
- Reduced stormwater runoff. Trees capture rainwater as it falls and absorb it through their roots. Reduced stormwater runoff reduces pressure on wastewater treatment facilities, reduces the risk of localized flooding, reduces toxins and particulates from flowing into streams and eventually into the Chesapeake Bay in the case of DC.
- Improved air quality. In addition to the air quality benefits of reduced urban temperatures, trees themselves can filter toxins from the air. They also sequester carbon, helping to reduce the risks of climate change.
- Wildlife habitat. Trees and other urban plants provide shelter and food for wildlife, including migratory birds and butterflies.
- Increased property values.
- Improved aesthetics. Trees look nice.

The simplest way to apply the portfolio standard to the DC urban tree canopy is to require each property to meet the same minimum requirement and ratchet it up slowly over time. Let's assume that the current canopy is still 21% as it was in 1997. The portfolio requirement could be set at 20% to start (it's a good idea to make the initial standard relatively easy to accomplish in order to get the system operating and keep prices low so there is less likelihood of backlash). If my property is 6000 square feet, then I would be required to have 1200 square feet of tree canopy--either actual canopy or "credits" from someone else. Suppose my lot is 50% covered with trees--3000 square feet. This is good, because I have an extra 1800 square feet of canopy that I can sell.

Now suppose the apartment complex down the street is on a 30,000 square foot lot, so their 20% requirement dictates 6000 square feet of tree canopy. However, they only have 4200 feet of tree cover. That means they need to purchase 1800 square feet of additional tree canopy from someone to meet their requirement. Voila! I can sell my 1800 square feet of extra credits to them, and we both now meet the standard.

Because I have gone above and beyond the minimum, I have been able to make money from the sale of my canopy credits. The apartment complex has had to pay for their lack of tree canopy. This is how it should be: our incentives are perfectly aligned with our environmental goals. If the price is high enough, the apartment owner will look for ways to plant more trees instead of buying credits.

In fact, that is the next step. After the initial couple of years, the requirement should start increasing. If the District's goal is to return to 37% tree canopy as it was in 1973 (or 40%, which is what American Forests recommends for urban areas; or 50, which is what Casey Trees suggests is feasible), then it can slowly increase the requirement over a couple of decades. Each year the value of tree canopy will rise so that the incentive to plant trees (or not cut them down) gets greater and greater.

Since a lot of the urban tree canopy is on public land, parks specifically, the city itself can earn money from selling its credits. This is politically tricky ground, though. In theory I like the idea of the city being driven by the same financial incentives as the rest of the market. However, it may want to create a mechanism in which the revenues received through the sale of canopy credits go to enhancing parks or improving environmental performance or other programs that residents will support. In addition, it's important that the system be designed so that it does not create the appearance that the city can manipulate the market to its advantage.

One other appealing feature of this concept is that it is completely scalable. A pilot program could be designed for a single neighborhood, district or ward. Everything works exactly the same, just on a smaller scale.

There are additional details that I won't go into here. Perhaps in a subsequent post.