World Bank publishes carbon report
May 8, 2007
The World Bank has published its seventh annual carbon market intelligence study, documenting a "booming" global carbon market and noting that the market tripled in 2006, when it was worth US$30 billion, compared with US$10 billion in 2005.
In addition, the State and Trends of the Carbon Market 2007 report notes that the projects-based market in developing countries and in countries with economies in transition grew sharply to US$5 billion in 2006, more than doubling with respect to the previous year.
The report also states that US$8 billion in new resources for developing countries has been generated through the Kyoto Protocol mechanisms since 2002, with estimates that direct carbon purchases have leveraged an additional US $16 billion in associated investments supporting clean energy in developing countries since 2002.
In particular, the report highlights the efforts of the "voluntary market", ie private efforts to reduce climate change, and claims that actions by individuals and companies not required by the Kyoto Protocol or other regimes is also taking off, with more than 50 companies offering offsets. Some estimates presented in the report put the volume of the voluntary market by 2010 at 400 million tonnes a year.
However, the report warns that the high-potential segment "lacks a generally acceptable standard, which remains a significant reputation risk not only to its own prospects, but also to the rest of the market, including the segments of regulated emissions trading and project offsets".
Commenting on the report, Warren Evans, World Bank Director of Environment, said, "These numbers are relevant because they demonstrate that the carbon market has become a valuable catalyst for leveraging substantial financial flows for clean energy in developing countries."
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