10 December 2008

Carbon trade in U.N. climate spotlight

Tropical forests and coal plants may get money to curb greenhouse gases under a United Nations-led carbon market from 2013 if climate negotiators meeting in Poland can defuse criticism of the present scheme.

Senior officials from about 190 countries have been meeting in the western Polish city of Poznan for talks, which began on December 1 and will end on Friday, to push for agreement on a new climate treaty, including rules for an expanded carbon offset market, by the end of next year.

The U.N.-led carbon offsetting scheme allows developed countries to lay off their greenhouse gas emissions and meet climate targets by funding cuts in developing nations.

Development groups and delegates at the climate talks criticized the scheme for helping Africa too little, producing too few emissions cuts, and, in some cases, claiming to avoid emissions that would not have happened anyway.

Carbon markets also face plunging prices, as sliding economies and industrial output dent greenhouse gas emissions and demand for offsets.

"Projects that have entered the pipeline will result in $25 billion of capital investment, will boost technology transfer developing countries," said the U.N. climate chief Yvo de Boer on Tuesday, supporting the clean development mechanism (CDM).

Carbon offsetting drives additional emissions cuts outside the industrialized countries most to blame for global warming, by funding projects, such as wind power and improved efficiency in developing nations.

"The wider the search the more likely you'll come up with emissions cuts that are relatively cheap and the more likely you get higher (climate) ambition," said Henry Derwent, head of the Geneva-based International Emissions Trading Association (IETA).

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Source: Reuters

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