The Market

Investing in Carbon Mitigation

The ‘carbon market’ refers to the global market for a new commodity created through the additional, measurable, permanent, and verifiable reduction of greenhouse gases (GHGs). The carbon market brings traditional finance models and structures to bear on the unprecedented issue of global climate change.

Emitters of carbon or other greenhouse gases (GHGs) may install a clean technology infrastructure or purchase carbon credits to ‘offset’ the pollution their organizations cause, thereby achieving zero net effect on the atmosphere. Carbon Offsets are created by a variety of means including the installation of  clean technologies or through saving existing forests. The majority of offsets are certified in accordance with the United Nations Framework Convention on Climate Change.

The carbon market is one of the worlds fastest growing markets and is predicted to be the largest global commodity market within the decade. Since its launch five years ago, Europe’s established carbon market has grown to over USD 120 billion per year. From 2003 – 2006 the carbon market was the fastest growing market in the world. Numerous other carbon markets have taken effect over the past two years including regional markets in China, Canada, the USA and New Zealand.

The carbon market continues to experience faster growth than steel experienced during the Industrial Revolution. This rapid progress represents an unprecedented investment opportunity – both in terms of financial returns and environmental impact.