U.S. To Create Massive Carbon Market
The next American President will most likely see the emergence of a colossal U.S. carbon trading market, worth $1 trillion a year by 2020, according to new research complied by New Carbon Finance. Another new report issued by Point Carbon estimates the U.S. could be trading $600 billion in pollution credits annually by 2015.
Carbon trading and finance is accelerating this year due to impending climate change legislation on Capitol Hill. The global carbon market could see a significant boom in the next decade, especially if the U.S. gets involved. Executive search firm, A.E. Feldman, says banks will be scouring the global talent pool for qualified candidates in the growing carbon trading sector.
The U.S. will be home to a $1 trillion U.S. dollar carbon emission market by 2020 if federal and state policymakers continue pursuing a comprehensive “cap-and-trade” program that is confined to domestic trading only. That’s among the findings of new research conducted by New Carbon Finance - a division of New Energy Finance - as reported by Environmental Leader.
At least 10 Northeastern and Mid-Atlantic states are committed to developing a multi-state cap-and-trade program in a bid to reduce greenhouse gas emissions by 10% compared to 1990 levels by 2018, under the Regional Greenhouse Gas Initiative (RGGI ).
Under a “cap-and-trade” system, the federal government would ration the amount of carbon dioxide and other greenhouse gases that businesses emit by issuing them permits. A business wanting to emit more than it is allowed may buy the right to do so from a business that emits less than its entitlement.
The value of the global carbon market shot up by 80% in 2007 - a sign of growing enthusiasm for the carbon trading industry among companies and investors worldwide, according to research by Point Carbon. Moreover, analysts believe the global carbon market could see a significant boom in the next 12 years, particularly if the U.S. steps in. ”It will be the largest environmental market of its kind,” says Tiffany McCormick Potter, Senior Analyst for Point Carbon.
Managing emissions has become one of the fastest-growing specialties in financial services, according to the New York Times. In fact, the NYT report states that carbon trading is already the new big thing in London’s financial world. Companies are scrambling to find workers in order to capitalize on a currently $30 billion market that could grow to $1 trillion within a decade.
The NYT quotes Louis Redshaw, Head of Environmental Markets at Barclays Capital, as saying, “Carbon will be the world’s biggest commodity market, and it could become the world’s biggest market overall.”
