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Carbon Trading - Ills and evils


World Bank states the global demand for carbon emission credits will exceed supply by 2012. [1]

The total trading of emission credits reached $30bn (£15bn) during 2006, three times as much as in 2005. The growth in 2004-2005 was 240%.

Carbon Credit

One Carbon credit is equivalent to one tonne of CO2 emissions. This credit can be sold at market price. The exchanges that deal with carbon credits are Chicago Climate Exchnage and European Climate Exchange

Kyoto Protocol
Under Kyoto Protocol, the countries hava a emission quota while siluataneously having to take steps to reduce the emissions. The countries can tackle their obligations by implementing clean projects (usually in developing countries taking advantages of costs) or by buying other countries'carbon credits.

Absolution

Carbon Credit, a hotly debated issue before being ratified at Kyoto, seeks to put a price on the activities of pollution. The basic idea is to penalise the polluting country/company.

Carbon Credit was hotly protested as it was seen as easy way out for the developed countries by "selling the sins of their pollution" to developing countries (the usual buyers). It was also protested because getting the pollution monkey off their back would lead to slack in new cleaner technologie and thier research.

The statement from World Bank of demand outstripping the supply means we will live in a far more polluted world, with polluting companies washing off thier sins by buying Carbon Credits. This is reminicient of medival knights buying absolution for past sins from clergy.

Issues

Not everybody is convinced of the concept of notional environment. The issues like what qualifies for the Carbon Credit , the effectiveness of these clean project in offsetting pollution and Cabon Credits acquired because of natural progression of technologies etc are some of the issues that are yet to be sorted out.

The Existence of Carbon Credit holds the environment hostage. To put it more finacial-jargonish, it spilts the pollution (risks) into small bits and pieces so that offset-party takes the risk. But as we know, the risk does not dimish - it barely changes hands. But alas, as long we have only one planet to live, the risk stays at home. The accounting tricks cannot brush off the realities of climate impact.

Cant help but squirm at this futile excercise when you read the solgan for International Emissions Trading Association - "Market soultions for Global environment problem".

Misguided intentions

The honorable intention of saving the earth is misguided: there is no point in us tracking our Carbon emmission for our drive to office, 'neutralise' it by buying the credits and print a needless 500 page printouts! NeW York Times poses "Is Carbon-neutral movement a gimmick?". Tell me otherwise.

What use is the accounting, offsetting or trading when the house is on fire. Its the only blue pearl we have.


:) Falkor

Kyoto protocol:







Resources:

Carbon Exchanges:

Fallacy of Carbon Trading:

Cons of Carbon Trading:

Pros for Carbon Trading:

In the news:


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