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Carbon trading a volatile market, World Bank finds

Submitted by Bill Becker on 17/May/2006

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The global market for carbon dioxide emissions was 10 times larger in 2005 than in 2004, the World Bank said yesterday, noting that recent events in the European Union's trading system underscored the market's extreme volatility.

The worldwide market in CO2 trading last year was worth more than $10 billion, 10 times the value of 2004, according to a new report from the bank. The entire U.S. wheat crop in 2005 was worth about $7.1 billion, main author Karan Capoor said.

"The data makes it clear that carbon is now a financial commodity," he said. "Carbon is now priced and business managers take the carbon price into consideration along with other factors in making business decisions."

Capoor said that last month's 50 percent price drop, caused by a number of E.U. nations announcing they emitted much less last year than they had sold credits for, showed that the market was like other financial commodities in its volatility.

Over the World Bank's period of study, buyers purchased 453.5 million metric tons of carbon dioxide, with Japan buying the most at 38 percent, followed by Britain with 15 percent and Italy with 11 percent. Australia, Canada, New Zealand and the United States each bought 1 percent.

China sold 66 percent of the total traded, followed by Brazil with 10 percent, the rest of Latin America with 7 percent and India with 3 percent (Agence France-Presse).

Bill Clinton zeroes in on climate change as biggest threat
Speaking yesterday in Glasgow, Scotland, former President Clinton said global warming was the biggest threat to the world.

"There may be other terrorist acts and some of those acts may involve small-scale biological, chemical or nuclear attacks," he said. "There has never been a nation destroyed by terrorism alone and it's not about to start now. But I think this climate change has the capacity to change the way all of us live on Earth."

Clinton also defended beleaguered British Prime Minister Tony Blair.

"Whatever political problems the government is in, the United Kingdom is way better off than it would have been had it not been governed the way it has for the last 10 years," he said (Agence France-Presse).

Canada to be 35% above emissions target
Canada's greenhouse gas emissions are 35 percent above the target it promised to reach under the Kyoto Protocol by 2008-2012, Environment Minister Rona Ambrose told Parliament yesterday.

"To put that into perspective ... that would mean that today we would have to take every train, plane and automobile off the streets of Canada," she said. "That is not realistic."

The previous Liberal government committed to reducing emissions to 6 percent below 1990 levels. Before the latest figures, data showed Canada to be emitting 24.4 percent more than 1990 levels (Reuters). (All cites May 10.) -- DK


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