It’s only a matter of time before the U.S. joins the global carbon trading community, according to Odin Knudsen, JP Morgan’s managing director of environmental products.
“The greatest challenge of people-kind since the Ice Age is to reduce carbon emissions, and one tool is cap and trade,” said Knudsen.
Valerie Davis of EnviroMedia Social Marketing spoke to Knudsen shortly before he joined a panel discussion at a December 6 event hosted by the International Emissions Trading Association at the U.N. Conference on Climate Change in Bali, Indonesia.
The Bali panel discussion comes one day after the U.S. Senate Environment and Public Works Committee passed a climate change bill that would limit emissions of carbon dioxide but allow trading of pollution permits. The bill now must pass the full Senate and then the House.
“The U.S. is coming into the market, Kyoto or no Kyoto, or sister of Kyoto,” said Knudsen, who pointed out during the panel discussion that investment banks like JP Morgan are entering the carbon trading market. “The good news is the big guys are coming in to play, and we are bringing a lot of money and risk management into the business.”
According to panelist Gilles Corre of Evolution Markets brokerage service, the global carbon market size has grown from $400 million in 2004 to $28 billion in 2006.