Parcel - February 2008 - (Page 13) both to help curb emissions and to make all forms of transport more fuel efficient. Emissions Trading Developed countries such as the UK that have signed the Kyoto Protocol have instituted aggressive emissions requirements and carbon trading schemes. Although carbon trading is new and conceptual, the basic premise is that the government allows each company a certain level of carbon emissions, and those with emissions below the maximum may “sell” carbon credits to those who emit more than the maximum. The US did not sign the Kyoto Protocol, but greenhouse gas emissions and their environmental impact have nonetheless become increasingly worrisome to government officials, the public and a number of companies. Consequently, a voluntary carbon market has emerged in the US that includes both the organized Chicago Climate Exchange, which launched in 2003, and what is being called an “over-the-counter” market that exists independently of the Chicago market. The Chicago Climate Exchange (CCX) is an organized, voluntary, legally binding greenhouse gas (GHG) market. CCX members have committed to reduce their emissions by four percent and six percent by 2006 and 2010, respectively, relative to their 1998-2002 average. Members can purchase allowances from other members or credits from approved offset activities in order to meet their reduction commitments. The over-the-counter segment of the voluntary market is differentiated from the organized market in that there is not a single marketplace or standard for these projects. “End users” in the over-the-counter markets consist of companies as well as individuals that want to reduce or offset their “carbon footprint.” Although smaller than the compliance markets, according to Scott Settelmyer of TerraCarbon, a financial services firm focused on carbon markets, the voluntary carbon market is quickly growing. In 2006, Settelmyer says, the worldwide voluntary market was estimated at 24 million tons valued at just under $100 million, split roughly evenly between CCX and the over-the-counter market. A recent survey of market participants indicated that this market is expected to grow from 25 million tons to between 400 million and 1 billion tons by 2012, driven in large part by greater consumer awareness and desire to offset emissions. “There’s a lot of activity in the voluntary carbon market among what people call corporate social responsibility or CSR buyers — companies that want to project a green image by offsetting emissions — but then you’ve also got a lot of growth being driven by businesses that are giving consumers the opportunity to offset emissions related with an event, a product or a lifestyle,” Settelmyer says. www.PARCELindustry.com February 2008 13 http://www.PARCELindustry.com
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