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Carbon Credits &The World Trading MarketA Literature Review<br />Steven K. Srivastava<br />Western Michigan University<br ...
Outline<br />Sustainability<br />Role of CCs in Sustainability<br />Evolution of CCs<br />Earth Summit, Kyoto Protocol<br ...
Sustainability:Defined<br /><ul><li>Fossil Fuels
CO2, NOx, SOx, Hg, VOC’s (smog)
Waste
Land-Fill Trash
Organic Waste (effluent)
Sequestration (Removal)
Photosynthesis
Oceanic
Degradation
Land-Fill Trash
Organic Waste (effluent)</li></li></ul><li>Sustainability:The Need For<br />
Sustainability:Result from Inaction<br />
Sustainability:Three Components<br />Sustainable Success<br />
Sustainability:Component Status<br />                  Currently Exists & is Maturing<br />                    In Developm...
Sustainability:Economic Burden<br />C<br />O<br />S<br />T<br />
Sustainability:Components in the United States<br />Research<br />Institutions<br />
Sustainability:The role of carbon credits<br />Carbon Credits is a tool used to enforce: <br />Cap=Policy<br />Trade=Mecha...
Carbon CreditWhat is it?<br />1 Carbon Credit =1 metric tonne of CO2<br />Or equivalent GHG emission<br />GHG Emissions Eq...
Evolution of Carbon Credits: Earth Summit<br />Where: Rio de Janeiro, Brazil<br />When:  July 14, 1992<br />Who:  Reps. fr...
Evolution of Carbon Credits:  Kyoto Protocol<br />Where:  Kyoto, Japan<br />When: December 11, 1997<br />Who: Reps from 12...
Carbon Credits:General Function<br />C        O        S        T <br />
Carbon Credits:In Business<br />
Cap & Trade:European Union ETS<br />10,000 + orgs.<br />Over 50% of EU CO2<br />Over 40% of Equivalent GHG<br />1.6 B Tonn...
Cap & Trade:EU ETS: Results<br />*All Countries<br />   Trade<br />Annual Emissions (M Tonnes CO2)<br />CO2 Emission % Cha...
Cap & Trade:EU ETS: Results<br />*All Countries<br />   Trade<br />Annual Emissions (M Tonnes CO2)<br />CO2/GDP   [kg/$]<b...
Cap & Trade:US Policy<br />1992:UNFCCC - Energy Star Label<br />1997:Kyoto Signed, Not Ratified<br />2001:Kyoto Rejected<b...
Cap & Trade: Results<br />No Trade<br />Trade<br />Annual Emissions (M Tonnes CO2)<br />CO2 Emission % Change from 91-02<b...
Cap & Trade:Results<br />No Trade<br />Trade<br />Annual Emissions (M Tonnes CO2)<br />CO2/GDP   [kg/$]<br />(Energilägt, ...
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Carbon Credits &amp; the Global Market

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Carbon Credits &amp; the Global Market

  1. 1. Carbon Credits &The World Trading MarketA Literature Review<br />Steven K. Srivastava<br />Western Michigan University<br />ISCSC Conference <br />June 7, 2009<br />
  2. 2. Outline<br />Sustainability<br />Role of CCs in Sustainability<br />Evolution of CCs<br />Earth Summit, Kyoto Protocol<br />EU Emission Trading Scheme (ETS)<br />US Policy Development<br />Cap & Trade<br />Results <br />CCX<br />World Trading <br />Possibilities<br />
  3. 3. Sustainability:Defined<br /><ul><li>Fossil Fuels
  4. 4. CO2, NOx, SOx, Hg, VOC’s (smog)
  5. 5. Waste
  6. 6. Land-Fill Trash
  7. 7. Organic Waste (effluent)
  8. 8. Sequestration (Removal)
  9. 9. Photosynthesis
  10. 10. Oceanic
  11. 11. Degradation
  12. 12. Land-Fill Trash
  13. 13. Organic Waste (effluent)</li></li></ul><li>Sustainability:The Need For<br />
  14. 14. Sustainability:Result from Inaction<br />
  15. 15. Sustainability:Three Components<br />Sustainable Success<br />
  16. 16. Sustainability:Component Status<br /> Currently Exists & is Maturing<br /> In Development<br /> Emphasis is Growing<br />Highly Dependent On<br />
  17. 17. Sustainability:Economic Burden<br />C<br />O<br />S<br />T<br />
  18. 18. Sustainability:Components in the United States<br />Research<br />Institutions<br />
  19. 19. Sustainability:The role of carbon credits<br />Carbon Credits is a tool used to enforce: <br />Cap=Policy<br />Trade=Mechanism<br />
  20. 20. Carbon CreditWhat is it?<br />1 Carbon Credit =1 metric tonne of CO2<br />Or equivalent GHG emission<br />GHG Emissions Equivalency Scaling Factor<br />(US EPA, 2009)<br />
  21. 21. Evolution of Carbon Credits: Earth Summit<br />Where: Rio de Janeiro, Brazil<br />When: July 14, 1992<br />Who: Reps. from a 192 industrialized countries<br />Purpose: Address the issue of Global Warming and its link to man-made processes<br />Result: Conduct Self-Study Energy Assessment before Kyoto<br />
  22. 22. Evolution of Carbon Credits: Kyoto Protocol<br />Where: Kyoto, Japan<br />When: December 11, 1997<br />Who: Reps from 122 industrialized and other sponsored countries.<br />Purpose: Begin Cap-&-Trade System<br />Results: Assign annex status, set nat. caps, outline repercussions for exceeding caps <br />Copenhagen: 2012 for Post Kyoto Assessment<br />
  23. 23. Carbon Credits:General Function<br />C O S T <br />
  24. 24. Carbon Credits:In Business<br />
  25. 25. Cap & Trade:European Union ETS<br />10,000 + orgs.<br />Over 50% of EU CO2<br />Over 40% of Equivalent GHG<br />1.6 B Tonnes of GHG’s annually (EU ETS)<br />May 29, 2009: €15.17per credit<br />Market Value: € 24.27B<br />or: $34.19 B<br />(CCX, 2009)<br />
  26. 26. Cap & Trade:EU ETS: Results<br />*All Countries<br /> Trade<br />Annual Emissions (M Tonnes CO2)<br />CO2 Emission % Change from 91-02<br />Germany<br />Czech Rep<br />Sweden<br />Spain<br />Italy<br />France<br />Denmark<br />(Energilägt, 2002)<br />(Energilägt, 2002)<br />
  27. 27. Cap & Trade:EU ETS: Results<br />*All Countries<br /> Trade<br />Annual Emissions (M Tonnes CO2)<br />CO2/GDP [kg/$]<br />(Energilägt, 2002)<br />(Energilägt, 2002)<br />
  28. 28. Cap & Trade:US Policy<br />1992:UNFCCC - Energy Star Label<br />1997:Kyoto Signed, Not Ratified<br />2001:Kyoto Rejected<br />2007:S.B. 213, 111th Congress (MI)<br />Electric Utility Providers: 10% renewable portfolio 2015<br />2009:Budget Proposal FY 2010 <br />14% reduction by 2020<br />83% reduction by 2050 Cap & Trade<br />(% based on 2005 GHG’s) 2012<br />(US Fed Budget FY 2010, 2009)<br />
  29. 29. Cap & Trade: Results<br />No Trade<br />Trade<br />Annual Emissions (M Tonnes CO2)<br />CO2 Emission % Change from 91-02<br />US<br />Mexico<br />Japan<br />Germany<br />Czech Rep<br />Sweden<br />Spain<br />(Energilägt, 2002)<br />(Energilägt, 2002)<br />
  30. 30. Cap & Trade:Results<br />No Trade<br />Trade<br />Annual Emissions (M Tonnes CO2)<br />CO2/GDP [kg/$]<br />(Energilägt, 2002)<br />(Energilägt, 2002)<br />
  31. 31. Cap & Trade:Chicago Climate Exchange<br />2003: Dr. Richard Sandor<br />Voluntary Cap-&-Trade Market<br />1 Credit=$1.20<br />(CCX, 2009)<br />2009<br />
  32. 32. Cap & Trade:Chicago Climate Exchange<br />350 Members<br />Ford Motor Company<br />DuPont<br />Michigan State University<br />Etc.<br />(CCX, 2009)<br />
  33. 33. Cap & Trade:The Global Trading Market<br />EU ETS Primary Market<br />2009 1.6 B Tonnes @ € 15.17 or $21.39<br />2012 4.2 B Tonnes @ € 20.21 or $28.49<br />&quot;The idea of a global cap and trade system ... is pretty far-fetched” – Paul Kelly<br /> Morgan Stanley<br />(CNN, 2009)<br />
  34. 34. Cap & Trade:Financial World<br />
  35. 35. Cap & Trade:Possibilities<br />Success: Adaptation<br />Equilibrium found<br />Culture of energy efficiency<br />Failure: Recession<br />Wide-spread bankruptcy<br />No equilibrium<br />Economy already fragile<br />US at greatest risk<br />
  36. 36. Cap & Trade:In Sustainability<br />Technological Breakthroughs<br />Global Cooperation<br />Cap & Trade<br />Carbon Options<br />Conceptual Breakthroughs<br />Feed-in Tariffs<br />
  37. 37. Conclusion<br />It is up to us.<br />
  38. 38. Thank you<br />Attendees<br />ISCSC<br />WMU<br />Professor Thomas Swartz<br />
  39. 39. Questions<br />

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