“Carbon Emissionaries“. Willis Eschenbach has another stab at discrediting carbon trading.

Can you believe that the trading value for carbon credits has fluctuated? Actually, I believe that’s how commodities markets naturally work.

Carbon credits are really low right now, so the whole thing’s a failure! So traders are waiting out some regulatory issues that will affect the future value of carbon credits. Big deal.

Do you realise that per capita carbon emissions in the EU, where they have a few carbon credit markets in operation, have risen while in the US, where they don’t have carbon credit markets, they have fallen? If you actually look at Willis’ charts you’ll see that the EU’s per capita fuel use has climbed substantially, but the carbon emissions? Not so much. So in effect they’re getting more industry out of each tonne of CO2 (increasing efficiency) but because they seem to have higher industrial activity the CO2 has actually increased a bit too.

I’m not going to embrace this because the “intensity-based” way of setting CO2 targets is really just a dodge (see my own Canadian government’s position for example), but it looks like the EU is managing to moderate the effect of industrial activity. Two steps forward but one step back is better than standing still.