2010/09/09

(NS3) Economist: World exchanges: The smoking greenhouse gun

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Economist: World exchanges: The smoking greenhouse gun
2010-09-09 23:40:06.801 GMT

FROM THE ECONOMIST

An alluring trade in "supergreenhouse" gas emissions is coming under
scrutiny.

ONE of the curiosities of carbon markets is that they do not just
trade in carbon. Other greenhouse gases can be given a value, too--
sometimes a very high one. Claims that these prices promote scammery
are now prompting some searching questions.€

Wind farms, solar programmes and other clean-energy projects are all
eligible for CERs. But because destroying a tonne of HFC-23 is a lot
cheaper than avoiding the emission of more than 10,000 tonnes of
carbon dioxide, HFC-23 destruction has become the CDM's principal
source of emissions credits. According to Sandbag, an outfit that
monitors carbon markets, 59% of the CERs used as offsets in the EU
cap-and-trade scheme in 2009 came from HFC-23 projects, representing
more than 500m ($695m) in credits.€€

Longer-term demand for HFC-23 CERs may fall, too. Connie Hedegaard,
the EU's climate commissioner, is calling for the role industrial-gas
CERs are allowed to play as offsets to be reassessed for the trading
scheme's next phase, which will run from 2013 to 2020. A Deutsche Bank
analysis suggests that by reducing supply, a tough stance on this
issue could drive the spot price of a tonne of carbon up from today's
15 to 25 by the end of the year.

SOURCE: The Economist
SubDES: YBX28739
SubId: YBX28739

-0- Sep/09/2010 23:40 GMT