FinSoul has learned of a recently released report that indicates that the global market for greenhouse gas emission allowances and credits to offset emissions saw substantial growth but the markets value remained about even with 2008 figures as prices fell due to numerous reasons including the global financial crisis and the anticipation of a binding climate change treaty from the Copenhagen talks.
The study by carbon market research firm Point Carbon based in Washington and Oslo showed that during 2009, 8.2 billion metric tons of CO2 equivalent was traded globally, an increase of 68% from 2008 figures. But the market value of $135 billion was virtually unchanged from the previous year with carbon prices averaging € 11.40 a ton, down almost 40%.
The international carbon market is dominated by the EU, where companies and utilities are required to either cut their emissions or purchase additional allowances or carbon credits from the market on the European Climate Exchange. The EU, which has seen volatile carbon prices influenced by fluctuations in energy prices, is set to continue its global carbon market dominance as the worlds largest polluters, China and the U.S. strive to establish domestic national climate change policies, FinSoul understands.
The U.S. first mandatory cap and trade program aimed at cutting CO2 emissions in the U.S., called the Regional Greenhouse Gas Initiative, began in the northeastern states in 2009, and saw growth of nearly tenfold to $2.5 billion, FinSoul believes Point Carbon said. California has announced plans to launch a cap and trade program in early 2010 but the U.S. carbon market is still primarily a voluntary one.
