05 Jun 2009
The Bonn conference will be running until the 12th of this month, they should by now have agreed the broad principles of a global emissions trading scheme, as this mechanism would lead to a cheaper price for carbon due to new and expanded crediting mechanisms.
I still think the idea of asking insurance and pension companies to invest in "rainforest bonds" could be a winner, this approach would be outside of the CDM.
One of the bigger questions is the level of assistance the developed nations will offer the developing world with it's carbon abatment efforts.
For the developing nations hoping to secure the maximum ammount of assistance, it will probably mean signing up to some form of target/agreement.
04 June 2009
Carbon Trading Price Rise Predicted
Oslo, Norway [RenewableEnergyWorld.com]
Phase 3 of the European Union's Emissions Trading Scheme (EU ETS) could see the price of an EU Allowance (EUA) rise from €30/tonne in 2013 to €40/tonne in 2016, according to market intelligence firm Point Carbon.
"It is now more likely that the EU will adopt a 30% reduction target. Furthermore, cap-and-trade schemes in the US and in other regions have become more likely, potentially linking up with the EU ETS."
-- Karl Magnus Maribu, Senior Analyst, Point Carbon
Such an increase, from current levels of around €15/tonne, is vital in order to meet the EU’s current emission reduction targets of 20% below 1990 levels and any possible increased reduction targets that may be discussed at the UN’s Copenhagen summit this December, Point Carbon believes.
These predictions, which appear in Point Carbon’s most recent Carbon Market Brief, entitled ‘EU ETS scenarios to 2020,’ depend on political developments and alter depending on several emissions scenarios.
Point Carbon highlights the three likely scenarios as being the EU-20 scenario, whereby the EU does not increase its current emissions reduction target, the EU-30 scenario, where the EU’s current reduction target is increased to 30% below 1990 levels and the ETS linking scenario, in which the EU ETS establishes a full link to a US ETS and other ETS schemes before 2018.
The EU-20 scenario would lead to a price range of €25-€50/tonne by 2016, the EU-30 scenario would lead to price range of €35-€65/tonne by 2016 and the final scenario would lead to a price range of €10-€30/tonne by 2016, significantly lower than the other two scenarios due to new and expanded crediting mechanisms and a large import limit, the company says.
Karl Magnus Maribu, author of the report, comments: “Over the last half year emissions projections have been dramatically reduced following the economic downturn resulting in lower emissions and a surplus of EUAs and Certified Emission Reductions (CERs) in phase 2 that can be banked into phase 3. At the same time, the US has become an active and constructive participant in the international climate negotiations and a climate agreement seems within reach. Therefore it is now more likely that the EU will adopt a 30% reduction target. Furthermore, cap – and - trade schemes in the US and in other regions have become more likely, potentially linking up with the EU ETS.”
G20 summit: leaders agree to look at Prince Charles's multi billion plan to save rainforests
G20 leaders have agreed to consider a multi-billion pound "emergency package" to save the rainforests following a meeting with the Prince of Wales.
Prince Charles is calling on G20 leaders to protect the rainforests
In a historic meeting at St James's Palace, the Prince told a number of heads of state that more must be done to protect the rainforests as a means of slowing the rate of climate change.
His charity, the Prince's Rainforest Project, proposes paying poorer countries billions of pounds not to chop down trees through market mechanisms, however this could take years to put into action.
In the meantime the Prince wants an "emergency package" to inject billions of pounds into saving the rainforest as soon as the beginning of next year.
The world leaders present, including representatives from rainforest nations like Indonesia and Brazil as well as US Secretary of State Hillary Clinton and the President of the World Bank, agreed to try and set up a means of raising the emergency funding. Financial mechanisms could include asking insurance and pension companies to invest in "rainforest bonds".
In the long term an international working group will look at the Prince's other proposals as well as a ideas to save the rainforests from other charitable organisations and governments.
The Prince told the meeting that halting deforestation, which accounts for around a fifth of global carbon emissions, was key to tackling climate change.
"As important and concerning as the global financial crisis is, its challenges and consequences will pale into insignificance when compared with the scale and extent of human misery and suffering, social and economic if our actions to tackle climate change are too little or too late or both.
Amazon releases CO 2 in drought
The Amazon forest is alarmingly sensitive to reduced rainfall, a comprehensive analysis of an unusual drought in 2005 has shown.
The study provides the first evidence that Amazonia could release vast amounts of carbon dioxide into the atmosphere if climate change produced hotter, drier weather in the region.
In normal years the forest absorbs nearly 2bn tonnes of CO 2 , acting as a vast carbon sink that helps reduce the impact of human activities. The drought caused a loss of more than 3bn tonnes. The net impact of the drought - 5bn extra tonnes of CO 2 in the atmosphere - exceeds the annual carbon emissions of Europe and Japan combined.
An international collaboration of 68 scientists from 13 countries carried out the study, which is published in Science.
"Visually, most of the forest appeared little affected, but our records prove tree death rates accelerated," said Oliver Phillips, lead author.