Greenhouse gases

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Greenhouse gases (GHGs) allow sunlight to enter the atmosphere freely. When sunlight strikes the earth’s surface, some of it is reflected back towards space as infrared radiation (heat). Greenhouse gases absorb this infrared radiation and trap the heat in the atmosphere. Over time, the amount of energy sent from the sun to the earth’s surface should be about the same as the amount of energy radiated back into space, leaving the temperature of the earth’s surface roughly constant.

Many gases exhibit these “greenhouse” properties. Some of them occur in nature, while others are exclusively human-made.[1] The principal greenhouse gases that enter the atmosphere because of human activities are:

  • Carbon Dioxide (CO2): Carbon dioxide enters the atmosphere through the burning of fossil fuels (oil, natural gas, and coal), solid waste, trees and wood products, and also as a result of other chemical reactions (e.g., manufacture of cement). Carbon dioxide is also removed from the atmosphere (or “sequestered”) when it is absorbed by plants as part of the biological carbon cycle.
  • Methane (CH4): Methane is emitted during the production and transport of coal, natural gas, and oil. Methane emissions also result from livestock and other agricultural practices and by the decay of organic waste in municipal solid waste landfills.
  • Nitrous Oxide (N2O): Nitrous oxide is emitted during agricultural and industrial activities, as well as during combustion of fossil fuels and solid waste.
  • Fluorinated Gases: Hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride are synthetic, powerful greenhouse gases that are emitted from a variety of industrial processes. Fluorinated gases are sometimes used as substitutes for ozone-depleting substances (i.e., CFCs, HCFCs, and halons). These gases are typically emitted in smaller quantities, but because they are potent greenhouse gases, they are sometimes referred to as High Global Warming Potential gases (“High GWP gases”). [2]

The Kyoto Treaty [3] is a treaty created to reduce global warming by cutting greenhouse gases. The Treaty helped set the framework for mandatory emissions reduction schemes such as cap-and-trade markets.

The Clean Air Act authorizes the Environmental Protection Agency to set National Ambient Air Quality Standards (NAAQS) which establish acceptable concentrations of six criteria pollutants: ozone, carbon monoxide, sulfur dioxide, lead, nitrogen dioxide and particulate matter.[4]

ALSO SEE: Emissions trading

Markets Evolve Around Greenhouse Gas Management[edit]

  • The Chicago Climate Exchange (CCX), a U.S. corporation, which launched its trading platform in 2003, is the only emissions reduction and trading system for all six greenhouse gases and the only operational emissions reduction and trading system in North America.[5]


2007 U.S. Climate Action Report


  1. EIA. What are Greenhouse Gases.
  2. Greenhouse Gases. EPA.
  3. Kyoto Protocol To The United Nations Framework Convention On Climate Change. BBC.
  4. Clean Air Act. The Environmental Literacy Council.
  5. CCX Overview. Chicago Climate Exchange.