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7 ways to be prepared for a US federal emissions trading scheme |
Posted by Administrator on 01/04/2009 |
With all the fuzz about the financial crisis we should almost forget about another crisis that urgently needs action: the climate crisis. According to Al Gore the former Vice President, who won a Nobel Peace Prize for his work on global warming, "the year 2009 will be the most important opportunity the world has ever had to make progress in really solving the climate crisis.'' And right he is, certainly when the US is concerned.
In 2009 Obama will replace George W. Bush, a president who opposed mandatory cuts of greenhouse gas pollution and did not want to ratify the Kyoto Protocol. Obama wants to change all that and it looks like it that he also has a willing Congress regarding carbon trading. On top of that the world will come together in Copenhagen, Denmark in December 2009, trying to agree on a major new international emissions agreement for the post 2012 period. The current Kyoto Protocol will end by 2012.
Especially in Europe there are high hopes that the US will finally live up to its responsibilities and take the lead in the negotiation process. However, the question remains whether President Obama despite all his nice rhetoric during his campaign will be able to pass a climate bill through Congress during a worldwide financial crisis in time to meet the crucial deadlines.
The impact of such a federal cap and trade system for carbon would be tremendous. According to a forecast made by New Carbon Finance, the US could have a $3 trillion carbon trading market by 2020. That is more than twice the size of the European Union's Emissions Trading Scheme (EUETS).
They also forecast that a U.S. cap-and-trade program would lead to a carbon price of $40 per ton as soon as 2015. What would result in a rise in consumer energy prices in real terms of roughly 20% for electricity, 12% for gasoline and 10% for natural gas. Of course this is only a forecast, but it makes apparent the enormous challenges and opportunities that lie ahead for corporate America.
Therefore each American company that might be affected – and which company isn’t - should begin preparing to understand the economic significance of the carbon trading market and the lessons that could be learned from the European Union Emissions Trading Scheme (ETS). The ETS is already operational since 2005. So now is the right time to try to understand the carbon market dynamics.
Below I describe 7 tips about how to make sure that you and your company will be ready and can benefit from the opportunities that will be certainly available in an emissions trading scheme:
- Kasper Walet -
Last changed: 04/08/2013 at 12:43 pm
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