The market for voluntary carbon offsets

ICF writes about the findings in their $5000 report Voluntary Carbon Offsets Market: Outlook 2007 (hat tip, GreenBiz),

The World Bank estimates that in 2005 the market for voluntary carbon offsets made up less than 10 million tonnes (Mt) of CO2e, or less than 1 percent of global carbon market transactions and less than 1 percent of the total market value of US$11 million.

The International Emissions Trading Association and World Bank estimate that the market for carbon credits has increased to US$ 2.3 billion in the first nine months of 2006 and that the overall carbon market is now worth more than US$21.5 billion…

“Our analysis examines several scenarios for the evolution of the market for voluntary carbon offsets, and our base case forecasts global demand of around 400 Mt of CO2e per year by 2010,” said Abyd Karmali, managing director for ICF’s European operations.

What are the problems? Credibility (including standards and verification), fragmentation, and overlap with the mandatory carbon emissions market.

What will happen to this market if they find out that global warming wasn’t really caused by CO2, it was methane all along?

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