The International Emissions Trading Association (IETA), part of the Business Action for Energy seeks the development of an active, global greenhouse gas market, consistent across national boundaries and involving all flexibility mechanisms: the Clean Development Mechanism, Joint Implementation and emissions trading.
The Business Action for Energy (BAE) is an ad-hoc, temporary business initiative bringing together a comprehensive network of global businesses. It looks to cover;
Members of Business Action for Energy
The IETA aims to;
IETA has established a number of Working Groups that meet in workshops and seminars on topics that include; accounting, taxation, trade agreements, registries, validation and verification, as well as issues in the CDM (Clean Development Mechanism, set up following the Kyoto Protocol).
IETA aims to develop and deliver courses on validation and verification based on the Validation & Verification Manual being developed with the World Bank as well as Workshops on Contracts for the CDM. More specifically the IETA is working with the World Bank Carbon Finance Unit (CFU).
The World Bank Carbon Finance Unit
The CFU uses money contributed by governments and companies in OECD countries to purchase project-based greenhouse gas emission reductions in developing countries and countries with economies in transition. The emission reductions are purchased through one of the CFU’s carbon funds on behalf of the contributor, and within the framework of the Kyoto Protocol’s Clean Development Mechanism (CDM) or Joint Implementation (JI).
The CFU says it does not lend or grant resources to projects, but rather contracts to purchase emission reductions similar to a commercial transaction, paying for them annually or periodically once they have been verified by a third party auditor. The CFU says the selling of emission reductions – or carbon finance – has been shown to increase the bankability of projects, by adding an additional revenue stream in hard currency, which reduces the risks of commercial lending or grant finance. Thus, carbon finance provides a means of leveraging new private and public investment into projects that reduce greenhouse gas emissions, thereby mitigating climate change while contributing to sustainable development.
The CFU says that the role of the Bank’s Carbon Finance Unit is to catalyze a global carbon market that reduces transaction costs, supports sustainable development and reaches and benefits the poorer communities of the developing world.
Although still in its infancy the global carbon market is clearly something business, the World Bank, governments and the UN’s CDM agency are keen to put in place and see working. The links are there between these organisations and the agenda set for a carbon market expansion during 2008/09. Quite for whom this would work best for is still unclear.