Post on 27-Mar-2015
Latin American Carbon Forum 2011
CARBON TRADING BEYOND 2012: NEW APPROACHES AND EMERGING MARKET INSTRUMENTSLatin America Carbon ForumSan José, Costa RicaSeptember 27, 2011
Martina BosiCarbon Finance Unit
The World Bank
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The climate challenge… demands action
TODAY’S DISCUSSION: NEW APPROACHES AND EMERGING MARKET INSTRUMENTS
How to keep momentum in carbon market?
Carbon markets can help identify and mobilize funding for least-cost mitigation options to achieve 2C target.
Carbon markets and carbon finance can be a key component in countries’ low emissions development/green growth strategies
But regulatory gap: Uncertainties on post-2012 framework to meet climate change goals
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•Send price signal directing capital flows to less carbon-intensive options
•Lower cost of meeting emission reduction targets through trading
•Catalyze low-carbon growth in developing countries> transactions of offsets (essentially private flows)> public funds through auctions / transaction taxes> crowd in private capital in support of $100 billion target
Carbon markets in the context of climate finance
$100 bn per annum
by 2020
Compares to historic ~$10 bn
p.a. of international
climate finance
Cancun Agreements, mobilize long-
term finance to address needs of
developing countries
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Market-based mechanisms for GHG mitigation:General landscape
InternationalDomestic (or sub-
national, or regional)
Trading mechanisms (allocation of ex-ante
allowances)
Crediting mechanisms (issuance of ex-post
credits)
Linking ?
e.g., EU Emissions Trading System
e.g., Trading under Kyoto
Protocol
e.g., Clean Development Mechanism
(CDM)
e.g., Alberta (Canada)-based
offsets eligible in Alberta’s trading
scheme
White (energy efficiency) certificatesGreen (renewable energy) certificates
As well as indirect (non-GHG) schemes:
GHG schemes
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Current and Proposed Emissions Trading Systems…
Operating Likely (?) Considering© OECD/IEA - 2010
ConsideringUnder preparationOperating
Latin American Carbon Forum 2011
Crediting Programs and Standards…
3,450 registered projects in 72 countries736 million CERs issued1-1.3 billion CERs expected by end of 2012Large source of climate finance to
developing countries: > $25 bn (2002-09) + leveraging investments
Clean Development Mechanism
Joint Implementation
282 registered projects (finally determined)
53 million ERUs issued~260 million ERUs expected by end of 2012
Latin American Carbon Forum 2011
Cancún decision on newmarket mechanism(s)
COP 16 Decision to consider establishment of 1 or more new market instruments at COP17
Maintain & build upon existing mechanisms, including KP mechanisms Elaboration during 2011
Parties and organizations have made submissions
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• Readiness for the new markets and emerging market instruments: key opportunities, challenges and needs?
• Can we build on experience & existing infrastructure or are we starting from scratch?
• What kind of mitigation actions is/should be targeted?
• Views/ outlook for linking with others markets and/or instruments?
Some Questions for the PanelTODAY’S DISCUSSION: NEW APPROACHES AND EMERGING MARKET
INSTRUMENTS