Eight years ago, the people in North Dakota who now talk about carbon dioxide were talking about a different "dioxide."

SO2.

Sulfur dioxide, the gas that is a key ingredient in acid rain, became the target of federal legislation. The government set a cap on emissions, and companies whose plants exceeded that ceiling had to pay penalties.

The result? A major reduction in SO2 pollution.

The acid rain program is relevant today because of talk about government restrictions on carbon dioxide. None currently exist, and maybe there will never be any.

But the feds have sent $80 million to Grand Forks recently to study the storage of carbon dioxide in North Dakota and elsewhere in the region. The scientists involved in that project join local air-quality officials and industry experts in guessing that some type of CO2 legislation may not be out of the question.

So what types of restrictions might be considered? Good question, and one it's way too early to answer. Another good question is how the government would structure a reduction program.

There are two techniques you may have heard about. One is called cap-and-trade, the other is referred to as a carbon tax.

The acid rain program worked on the cap-and-trade model.

The idea there is that polluters are given a certain allowance for emissions - for SO2, it was one ton per year. The emissions must be regularly monitored. If a polluter's emissions are less than the allowance, they can bank their credits or sell them on the market. If they exceed their allowance, they must buy credits or otherwise offset emissions. With CO2, an offset could be capturing the gas and storing underground.

North Dakota's SO2 cap took effect Jan. 1, 2000. In 1999, the power plants here emitted about 185,000 tons of sulfur dioxide. By 2006 - the most recent data available - emissions were around 130,000 tons. Terry O'Clair, the state's air quality chief, predicts they'll eventually be down to around 60,000 tons - a similar amount to what was emitted here in the 1970s.

"What we've seen from experience with the acid rain program is, it works when you give the incentive to companies to find an appropriate treatment," said Dave Glatt, director of the state Health Department's environmental health section. "When they emit more, they pay more, and if they go out of their way to reduce emissions they can benefit from that financially. It puts it on the open market and leaves it up to the companies. We've seen companies step up to the plate."

One problem with that plan, however, is the treatment technology for large-scale carbon capture at coal-fired power plants hasn't been perfected yet. Until it is, meeting an imposed cap could be exceedingly difficult.

A carbon tax works differently.

It's essentially a tax on the use of fossil fuels.

It would be paid at the point where the coal is mined or the oil is pumped out of the ground. The mining and oil companies would then pass along the extra cost, which conceivably could trickle down to the end user. Fossil fuels would be taxed at different rates, depending on how much CO2 they release when burned. Natural gas emits the least, then petroleum products, then coal. Coal, then, would be taxed more heavily than natural gas.

Companies could receive tax credits for sequestering carbon dioxide. They likely wouldn't have to pay a tax on a product that contained carbon but was not burned.

"There are pros and cons with each (management system)," Glatt said. "At the end of the day, in the acid rain program we saw significant reductions in sulfur dioxide emitted. Hopefully that would also happen with carbon dioxide."

(Some information in this story was obtained through the U.S. Department of Energy and the nonprofit, nongovernmental Carbon Tax Center. Reach reporter Tony Spilde at 250-8260 or tony.spilde@;bismarcktribune.com.)