Carbon trading for economic growth
06 December 2005
Carbon trading is becoming a major economic force, according to a survey across the EU.
Highlights of the survey, commissioned by the European Commission's directorate-general environment to review the EU emissions trading scheme, were published at the start of the UN climate change conference in Montreal, which ends on Friday.
The survey includes responses from 167 companies, and a total of 163 associations, NGOs, government bodies and market intermediaries. Its authors claim that the trading scheme is influencing corporate behaviour: about half the companies surveyed already take account of CO2 allowances in long term decisions. NGOs and government organisations want chemicals companies to be included in the scheme, which at the moment is restricted to combustion installations.
Brendan Fisher, an economist studying the economic impacts of carbon trading and climate change at the Gund Institute for Ecological Economics, University of Vermont, US says the findings support the workability of the scheme. He said that a common major goal for all participants is needed for a trading scheme to be most efficient. That goal should have maximum flexibility at the local level, he added.
The US federal government refused to sign the Kyoto climate change protocol, the rule book of which was accepted in the opening sessions of the Montreal conference. 'From the US side, the leadership from the White House is appalling, but the effective and responsible action is occurring far from the White House,' said Fisher. 'In Montreal, while forging ahead without the US is not ecologically ideal, it seems to be politically necessary.'
Fisher welcomes strategies like the EU emissions trading scheme. 'If the post-Kyoto period can bring us a trading system with this idea of maximum micro-flexibility perhaps sub-national US entities like US states and corporations can participate.'Brenda Boardman at the University of Oxford's Environmental Change Institute in the UK said carbon trading schemes will become a lever for the US to sign up to global emissions targets. 'Helping climate change will help the economy,' she said. Katharine Sanderson