{"id":11821,"date":"2015-11-19T14:14:43","date_gmt":"2015-11-19T19:14:43","guid":{"rendered":"http:\/\/blogs.edf.org\/climate411\/?p=11821"},"modified":"2015-11-19T14:14:43","modified_gmt":"2015-11-19T19:14:43","slug":"3-signs-were-entering-a-golden-age-for-carbon-markets","status":"publish","type":"post","link":"https:\/\/blogs.edf.org\/climate411\/2015\/11\/19\/3-signs-were-entering-a-golden-age-for-carbon-markets\/","title":{"rendered":"3 signs we&#8217;re entering a golden age for carbon markets"},"content":{"rendered":"<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\"><em><img loading=\"lazy\" decoding=\"async\" class=\"alignright\" src=\"https:\/\/d1taatozpbffx3.cloudfront.net\/cdn\/farfuture\/XHlbxqNJ-NKVN9ME3zDN49T-stvkHrl25N8GfCImlDM\/mtime:1447859243\/sites\/default\/files\/money_389x235.jpg\" alt=\"\" width=\"342\" height=\"208\" \/>This is an adaptation of an essay by Fred Krupp and<span class=\"Apple-converted-space\">\u00a0<\/span><a href=\"https:\/\/www.edf.org\/people\/nathaniel-keohane\">Nat Keohane<\/a>\u00a0for the International Emissions Trading Association\u2019s Greenhouse Gas Market 2015\/2016<span class=\"Apple-converted-space\">\u00a0<\/span><\/em><em><a href=\"http:\/\/www.ieta.org\/ghgmarket2015\">report<\/a>.\u00a0This adaptation was originally posted on <a href=\"https:\/\/www.edf.org\/blog\/2015\/11\/19\/3-signs-were-entering-golden-age-carbon-markets\">EDF Voices<\/a>. <\/em><\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">There was a time when<span class=\"Apple-converted-space\">\u00a0<\/span><a href=\"https:\/\/www.edf.org\/approach\/markets\">market-based approaches<\/a><span class=\"Apple-converted-space\">\u00a0<\/span>seemed to fall off the radar in discussions of climate policy, but carbon markets are back.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">Well-designed emission trading systems offer the combination of flexibility, incentives and guaranteed results that help polluters meet their targets \u2013 while leaving it up to the market to figure out the best way to meet them, driving costs down.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">This is why so many companies are<span class=\"Apple-converted-space\">\u00a0<\/span><a href=\"https:\/\/www.edf.org\/blog\/2015\/03\/26\/these-execs-will-tell-you-price-carbon-good-business\">staunch supporters<\/a><span class=\"Apple-converted-space\">\u00a0<\/span>of emissions trading, and why national and international efforts are taking off.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">Here are three indications \u00a0we may be entering a golden age for carbon markets and what it means for<span class=\"Apple-converted-space\">\u00a0<\/span><a href=\"https:\/\/www.edf.org\/climate\/cop21-united-nations-climate-talks\">COP21<\/a>, the international climate talks that begin in Paris later this month.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\"><strong>1. Carbon markets are going global<\/strong><\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">Climate progress in the United States and China is changing the global dynamic.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">Gone are the days when the two largest emitters blame each other for inaction, and their bilateral progress is inspiring commitments around the world. All told, cap-and-trade programs are in place in more than 50 jurisdictions worldwide that are home to nearly a billion people.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">Quebec and California have linked their carbon markets, creating North America\u2019s largest cap-and-trade system, becoming the first example of subnational jurisdictions in different countries launching a joint market. And more programs are in the works.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">Ontario, Canada\u2019s most populous province and home to a significant manufacturing base,<span class=\"Apple-converted-space\">\u00a0<\/span><a href=\"http:\/\/blogs.edf.org\/californiadream\/2015\/04\/13\/ontario-on-a-tear-with-its-new-climate-proposal\/?_ga=1.208043090.1918462526.1446839096\">is developing<\/a><span class=\"Apple-converted-space\">\u00a0<\/span>a cap-and-trade program to launch by 2017 and link to California and Quebec\u2019s market by 2018. Having the largest U.S. state and Canadian province in a formal, linked carbon market will help lay the foundation for further carbon market collaboration in North America and beyond.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">China, meanwhile, is<span class=\"Apple-converted-space\">\u00a0<\/span><a href=\"https:\/\/www.edf.org\/blog\/2015\/09\/25\/china-carbon-market-game-changer-years-making\">set to open<\/a><span class=\"Apple-converted-space\">\u00a0<\/span>a national carbon market in 2017, the world\u2019s largest.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\"><strong>2. Next: International aviation and tropical forests<\/strong><\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">One of the most exciting opportunities is in international aviation.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">The International Civil Aviation Organization (ICAO) is developing a market-based mechanism for consideration at its next Triennial Assembly in 2016 to help the sector meet its stated commitments to carbon-neutral growth from 2020 and a 50-percent cut by 2050.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">That would cap emissions from a global sector that accounts for roughly 2 percent of carbon emissions, and growing fast, and would set a powerful precedent for international cooperation on climate change.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">Another opening is in the forest sector.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">Tropical forests are not only crucial to stabilizing the climate \u2013 they are critical to sustainable economic development for the communities and nations that rely on them. Carbon markets can play<span class=\"Apple-converted-space\">\u00a0<\/span><a href=\"https:\/\/www.edf.org\/climate\/deforestation-solved-carbon-markets\">a key role<\/a><span class=\"Apple-converted-space\">\u00a0<\/span>in driving a new model of green growth in the tropics.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">By allowing jurisdictional REDD+ credits (short for Reducing Emissions from Deforestation and forest Degradation) into their compliance markets, California \u2013 and, perhaps soon, the ICAO \u2013 have the opportunity to create positive economic incentives for forest protection at a landscape scale.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\"><strong>3. Existing markets are thriving<\/strong><\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">Since 2006, when California\u2019s climate change program was signed into law, the state has received more clean tech venture capital investment than all other states combined. Bloomberg News recently ranked the Golden State the best place in the U.S. to do business, citing the state\u2019s<span class=\"Apple-converted-space\">\u00a0<\/span><a href=\"https:\/\/www.edf.org\/climate\/california-climate-launch-pad\">visionary leadership<\/a><span class=\"Apple-converted-space\">\u00a0<\/span>on climate change as one of the markers of its success.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">A good illustration of how market-based policies can promote greater ambition is the landmark U.S. cap-and-trade program for sulphur dioxide. This program reduced national average concentrations of the pollutant by 76 percent since 1990 \u2013 taking an enormous step toward solving the problem of<span class=\"Apple-converted-space\">\u00a0<\/span><a href=\"http:\/\/www.edf.org\/approach\/markets\/acid-rain\">acid rain<\/a><span class=\"Apple-converted-space\">\u00a0<\/span>ahead of schedule and well below the estimated cost while creating hundreds of billions of dollars in annual benefits.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">And despite well-publicized ups and downs \u2013 attributable in large part to the worst recession since the 1930s \u2013 the European Union\u2019s emissions trading system is now performing well. It has over-achieved its goals, leading to more reductions at lower cost than expected.<\/p>\n<h4 style=\"font: bold 15px\/20px Georgia, 'Times New Roman', Times, serif;margin: 30px 0px 20px;padding: 0px;border: 0px currentColor;color: #444233;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">To COP21 in Paris\u2026and beyond<\/h4>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">How can we capitalize on this political moment and build on the momentum we are seeing, to keep carbon markets growing around the globe?<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">A durable climate regime established by the Paris agreement will be one that harnesses<span class=\"Apple-converted-space\">\u00a0<\/span><a href=\"https:\/\/www.edf.org\/approach\/markets\">market forces<\/a><span class=\"Apple-converted-space\">\u00a0<\/span>in the hunt for solutions, mobilizes private sector energies, enhances national self-interest and, through rigorous and transparent reporting, allows countries to demonstrate to each other that they are meeting their commitment.<\/p>\n<p style=\"font: 14.25px\/20px Georgia, 'Times New Roman', Times, serif;margin: 0px 0px 25px;padding: 0px;border: 0px currentColor;color: #000000;text-indent: 0px;letter-spacing: normal;vertical-align: baseline;background-color: #ffffff\">A United Nations agreement is only one of many tools available to address climate change. It will take continuing strong action by leading emitters and leading carbon market jurisdictions to spur the technological, political and institutional transformations that will support more ambitious action in the years to come.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>This is an adaptation of an essay by Fred Krupp and\u00a0Nat Keohane\u00a0for the International Emissions Trading Association\u2019s Greenhouse Gas Market 2015\/2016\u00a0report.\u00a0This adaptation was originally posted on EDF Voices. There was a time when\u00a0market-based approaches\u00a0seemed to fall off the radar in discussions of climate policy, but carbon markets are back. Well-designed emission trading systems offer the &#8230;<\/p>\n","protected":false},"author":19,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[43,20],"tags":[],"coauthors":[],"class_list":["post-11821","post","type-post","status-publish","format-standard","hentry","category-economics","category-news"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>3 signs we&#039;re entering a golden age for carbon markets - Climate 411<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/blogs.edf.org\/climate411\/2015\/11\/19\/3-signs-were-entering-a-golden-age-for-carbon-markets\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"3 signs we&#039;re entering a golden age for carbon markets - Climate 411\" \/>\n<meta property=\"og:description\" content=\"This is an adaptation of an essay by Fred Krupp and\u00a0Nat Keohane\u00a0for the International Emissions Trading Association\u2019s Greenhouse Gas Market 2015\/2016\u00a0report.\u00a0This adaptation was originally posted on EDF Voices. 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In recent years Krupp has become perhaps best known as an influential leader on climate and energy.\",\"sameAs\":[\"http:\\\/\\\/www.edf.org\\\/people\\\/fred-krupp\"],\"url\":\"https:\\\/\\\/blogs.edf.org\\\/climate411\\\/author\\\/fkrupp-2\\\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"3 signs we're entering a golden age for carbon markets - Climate 411","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/blogs.edf.org\/climate411\/2015\/11\/19\/3-signs-were-entering-a-golden-age-for-carbon-markets\/","og_locale":"en_US","og_type":"article","og_title":"3 signs we're entering a golden age for carbon markets - Climate 411","og_description":"This is an adaptation of an essay by Fred Krupp and\u00a0Nat Keohane\u00a0for the International Emissions Trading Association\u2019s Greenhouse Gas Market 2015\/2016\u00a0report.\u00a0This adaptation was originally posted on EDF Voices. 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