Copenhagen must create more buyers for carbon markets

Demand for emissions-reducing projects is shrinking. Here's my solution to get supply and demand back in balance

Bryony Worthington
guardian.co.uk, Friday 29 May 2009 16.47 BST

As I've been reminded at this week's Carbon Expo in Barcelona, carbon markets need more buyers. I've met a large number of people who are eager to get their climate-busting solution funded by selling permits on the carbon trading market. Some want to build windfarms and other renewables, others wish to prevent forests being cut down, others want to bury charcoal – fertilising soils and trapping carbon – still others want to seed the oceans with micro-nutrients to bring the oceans' ailing biodiversity back to life.
But unless something dramatic happens, even if they succeed in gaining entry to the carbon trading club, the party may just end upon their arrival. Until 2013, the only real demand for emissions-reducing projects comes either from a handful of countries faced with a Kyoto target they have yet to reach, or those power sector companies in Europe who have been given a tight cap under the European trading scheme. Even this limited demand is being rapidly eroded by the effect of the recession, which is reducing demand for energy.
That's why all eyes are on the UN climate summit in Copenhagen in December – it has to create a lot of new buyers. But will it? Today's session on The US's role in a post-2012 regime received a large audience, which is not surprising since the US is the new kid on the carbon trading block and holds the key to unlocking the political stalemate generated by Kyoto. But anyone hoping to hear about the US's international ambitions for a strong global deal would have been sorely disappointed.
The elephant in the room, as one passionate environmental campaigner pointed out, was the US climate and energy bill's woefully unambitious target of a 17% cut in greenhouse gases by 2020. Even though the draft of the bill talks boldly about allowing up to 1bn permits to be bought from emission reductions projects from around the world, it's likely US emissions will naturally fall by 1% each year because of the recession and energy efficiency – meaning no one will need to buy those permits.
So here is my suggestion to get supply and demand back in balance. All those people who have worked out how to save emissions, how much money they need, how many tonnes they can save, need to form a powerful lobby group. Its lobbying should simply require that the future world carbon emissions budget is set by subtracting all the savings they know they can sensibly generate, from the current level of global emissions. The people required to buy these reductions must be the existing polluters and the government's only role, once the budget is set, should be to ensure the solutions are making it to market. The US should lead the way by immediately halving the allocation of permits that it is proposing to give to itself.
This may all sound unlikely, but as my friend pointed out in an analogy involving Burnley football club – you have to dare to dream. If Burnley can turn themselves around then so can the carbon market, but it will require hard graft and passion, channelled towards the right goal: a challenging global emissions budget that's surprisingly affordable.
• Bryony Worthington is director of Sandbag.org