INDUSTRY CAUGHT IN CARBON 'SMOKESCREEN'
April 30, 2007
Companies and individuals rushing to go green have been spending millions on "carbon credit" projects that yield few if any environmental benefits, according to a Financial Times investigation.
- The Times uncovered widespread failings in the new markets for greenhouse gases, suggesting some organizations are paying for emissions reductions that do not take place.
- Others are meanwhile making big profits from carbon trading for very small expenditure and in some cases for clean-ups that they would have made anyway.
- The growing political salience of environmental politics has sparked a "green gold rush" which has seen a dramatic expansion in the number of businesses offering both companies and individuals the chance to go "carbon neutral," offsetting their own energy use by buying carbon credits that cancel out their contribution to global warming.
- The burgeoning regulated market for carbon credits is expected to more than double in size to about $68.2 billion by 2010, with the unregulated voluntary sector rising to $4 billion in the same period.
The investigation by the Times also found:
- Widespread instances of people and organizations buying worthless credits that do not yield any reductions in carbon emissions.
- Industrial companies profiting from doing very little -- or from gaining carbon credits on the basis of efficiency gains from which they have already benefited substantially.
- Brokers providing services of questionable or no value.
- A shortage of verification, making it difficult for buyers to assess the true value of carbon credits.
- Companies and individuals being charged over the odds for the private purchase of European Union carbon permits that have plummeted in value because they do not result in emissions cuts.
Source: Fiona Harvey and Stephen Fidler, "Industry caught in carbon 'smokescreen,'" Financial Times, April 25, 2007.
Browse more articles on Environment Issues