Saturday, January 26, 2008

Carbon Market Hot, but Global Warming Need More

From Wall Street to Beijing, interest in carbon trading is on the rise. The Wall Street Journal reports that trading almost doubled in value last year, to more than $59 billion. Although American and Chinese companies are getting more involved, Europe - which has had a cap-and-trade policy in play for several years - makes up most of that increase.

But a cap-and-trade system is going to solely solve the global warming problem. In other words, there's no silver bullet to change the game, but rather a lot of silver BBs are needed to curb emissions.

Interestingly, Goldman Sachs - which
Ceres just put at the top of its ranking of banks' taking action on global warming - has also pointed out that cap-and-trade isn't going to do it alone. The U.S. must simultaneously invest in the research, development, and implementation of clean technologies on a large scale. From Reuters:

The bank's carbon head Ken Newcombe was emphatic that cap and trade has huge potential in the United States, the world's largest energy consumer.

But government research and development budgets should also be boosted to complement cap and trade's potential to spur innovations and investments in carbon-cutting techniques, he said.

Ray Kopp, the director of the climate change program at the nonpartisan Washington-based think tank Resources for the Future, echoed Newcombe, saying that any U.S. climate change policy has got to be followed up with more robust research, development and deployment programs for clean technologies.

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