This week in V-Carbon...
At the beginning of this month alone, cap-and-trade came into force in California, Quebec, Kazakhstan and Croatia. While domestic markets emerge around the world, the EU Emissions Trading Scheme crashed to a record low yesterday and the Clean Development Mechanism market remains in limbo. Against this backdrop, what role should voluntary carbon markets adopt in upcoming years?
At a post-Doha debrief with industry leaders hosted on Wednesday by Ecosystem Marketplace, McGuire Woods and the International Emissions Trading Association, Zubair Zakir, Global Carbon Director at The CarbonNeutral Company, cautioned, "The voluntary market can’t be a stop-gap measure for surplus CER supply – it really is the role of governments to intervene."
Some suppliers working in the compliance markets have sought to obtain a premium for low-priced CERs by selling into the voluntary carbon markets, but Zakir stressed that the priorities and capacity of the voluntary markets – which are limited in size and demand – lie elsewhere.
“The voluntary market’s real contribution, and what it does best, is focusing innovation on and highlighting areas where emission reductions can be efficiently created whilst generating significant sustainable development impacts," he says.
Back to the demand side, panelists at Wednesday's event pointed to the greening of supply chains as a bright spot of opportunity for corporate offsetting – and in some cases insetting – particularly in the realm of agriculture.
Overall, panelists voiced conviction that Doha’s extension of the Kyoto Protocol through 2020, alongside governments’ continued development and linking of domestic markets, provides a clear, long-term signal for carbon offset project developers and investors.
Panelists also stressed the shift during Doha toward planning for adaptation in addition to mitigation, through fund-based investments but also the emergence of vulnerability reduction credits, a new form of market mechanism designed to finance climate change adaptation projects in developing countries.
Ecosystem Marketplace will shortly publish an article that discusses major points from the panel, keying in on prospects for climate finance and private sector engagement. Stay tuned!
These and other stories from the voluntary carbon marketplace are summarized below, so keep reading! Note that we are still fundraising for the State of the Voluntary Carbon Markets 2013 report, slated for publication at Carbon Expo 2013 – if we are able to raise sufficient contributions to continue this research. Many thanks to The CarbonNeutral Company, American Carbon Registry and Forest Carbon Group for already coming aboard! This report – which is freely available thanks exclusively to sponsors’ support – remains a key benchmark for the market. To learn more about sponsoring next year’s report, click here for our prospectus and contact Molly Peters-Stanley for details.
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