01/23/2012 12:10 pm ET Updated Mar 24, 2012

Putting Cap and Trade Back Into Play

The nation's first experiment with a cap and trade system for carbon emissions has come to an end -- as of the first of the year, the Chicago Climate Exchange no longer deals in carbon credits. That is a blow to the U.S.'s effort to limit greenhouse gases, but it cannot and must not be the end of the story.

Cap and trade has always made sense as a practical market-driven solution for reducing carbon emissions. And it makes more sense than ever now that new technologies are on the way that will make it easier and more affordable to limit this major cause of climate change.

This is an election year, so reviving cap and trade as a legislative initiative in Washington should be front and center as a campaign issue. Democrats should light a fire under President Obama, who was a big supporter of the concept when he ran in 2008 but went silent on the subject once it became politically unpopular.

And every Republican who cares about the environment should put pressure on the GOP candidates to get on board with cap and trade. Or rather, get back on board, since some who oppose it now were for it in the past. When Mitt Romney was governor of Massachusetts, for example, he supported the Northeast's emissions-capping system. Newt Gingrich made a strong statement in favor of cap and trade in 2007 and in 2008 tapped that memorable video with Nancy Pelosi calling for action on climate change.

Yes, I know cap and trade got hammered during the 2010 congressional elections after opponents, especially in the Tea Party, dubbed it "cap and tax." But I also know the pendulum can swing in politics -- and candidates can switch positions faster than a chameleon changes colors. If enough voters, editorial pages, campaign contributors and other voices make it known that they want action on climate change and that cap and trade is a smart way to do it, the balance can tip back the other way.

The logic of creating a national cap and trade system is going to become increasingly obvious as new technologies give the power to reduce carbon emissions not only to businesses, industries and utilities, but also to ordinary citizens.

To cite one example, my own company is working with Auburn University to bring to market within the year a device called Strataclear that can reduce the CO2 from cars, trucks and other vehicles by up to 25 percent.

The same technology will also be able to cut the CO2 from ordinary home furnaces by up to 50 percent while simultaneously reducing the homeowner's water-heating bill by up to 37 percent. When you consider that the average home furnace produces 50 percent more carbon dioxide than the average car, that is a major contribution.

These reductions, as well as those from other technologies, could be commodified -- turned into real money -- if the nation had cap and trade. The system would enable those who cut their CO2 emissions to earn credits. The credits could then be sold to brokers who would trade them to companies that needed offsets against carbon dioxide emissions that exceeded established limits. That's the beauty of cap and trade: Greenhouse gases get reduced, and those who do the reducing reap a profit -- a win-win situation.

Europe is pressing ahead with its plan to cut CO2. In fact, on Jan. 1, just as the Chicago Climate Exchange's cap and trade experiment was coming to an end, new European Union regulations went into effect that make airlines financially liable for carbon emissions over the continent.

Not everyone agrees that man-made causes are leading to climate change, of course. But polls show that most Americans are convinced it's happening and something must be done about it. A presidential election year is exactly the time for the majority to be heard.

Donald G. Rynne is chairman and CEO of Ryncosmos LLC, owner of Strataclear Technology.