By Gerard Wynn
LONDON (Reuters) - A clear, global carbon price remains elusive after United
Nations talks last week hinted at a climate change deal no sooner than 2009 --
uncertainty which undermines the drive to make industry invest in clean energy.
Carbon prices are meant to impose a cost on emitting the greenhouse gases
blamed for global warming, and so drive countries, businesses and individuals to
clean up.
One way of achieving such a price is through carbon markets, which put an
overall limit on emissions but allow participants busting their caps to buy
rights to emit greenhouse gases from those within their limits.
A carbon market already exists through the Kyoto Protocol, which caps 36
industrialized countries emissions -- but it does not set caps on three of the
world's top four culprits: the United States, China and India.
Fears that emissions caps constrain industry and so competitiveness are
hampering global agreement on a new deal after present Kyoto rules expire in
2012, a deal which would allow industry to estimate the future price of carbon
and invest accordingly.
"If we don't make a set of numbers by at least 2009 then the chances of the
(carbon) market functioning in 2012 will be very slim indeed," said Henry
Derwent, director of Climate, Energy and Environmental Risk at Britain's
environment ministry, speaking at a Euromoney-backed energy conference in
London.
But 2009 is not soon enough for some.
"I think 2009 is two years too late," said Neil Eckert, Chief Executive of
Climate Exchange PLC (CEV.L: Quote,
Profile,
Research),
which wholly owns the European Climate Exchange and the Chicago Climate
Exchange. Continued...
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