Global and regional emissions trading markets are emerging and drive strategic energy policy. The EU-ETS is a leading player and dominated carbon trading in 2006; it is pivotal to achieving a truly 'global' carbon trading scheme and meeting the wider environmental challenge. The Clean Development Mechanism is key to engaging non-EU participants such as China who dominate the CDM market. With this new report establish the current level of trading in carbon and assess the drivers for global carbon trading.
This report provides:
Analyses of regional carbon markets and the interaction with global carbon programs (compares the EU ETS with alternative emissions reducing schemes)
Insight into the constraints faced by the major players reaching their carbon targets set out by the Kyoto protocol, in particular Phase 2 of EU ETS
An assessment of carbon market fundamentals - supply, demand and the carbon emissions schemes that attract investors
Some key findings:
Standardized exchange trade accounted for almost a quarter of the European carbon market. The European Carbon Exchange (ECX) accounted for around three quarters of all formalized emissions trading last year. Europe's leading power exchanges have used synergies with the carbon market to capture significant ETS volume.
171 states signed the Kyoto Protocol by June 2007. Under the Kyoto Protocol, all Annex II countries have established emission quotas, in ratifying the protocol, essentially agreeing to bear the costs of emission reductions. With the EU viewed collectively as a single economy, it accounts for 27 of the 33 Annex II countries to ratify Kyoto.
China dominates selling into the CDM - China's rapidly growing, increasingly carbon-intensive economy offers the greatest scope for cost-effective Certified Emissions Reductions. Governments often invest in CERs to help meet their overall Kyoto targets, while private investors may look to hedge their exposure in regional markets like the EU ETS.
Published November, 2007
View Table of ContentsPages: 27
Publisher: Datamonitor
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