Barclays Closes US Carbon Desk is Southern Company’s Mississippi Power Latest Cap-And-Trade Setback

Barclays Closes US Carbon Desk In Latest Cap-And-Trade Setback: ‘A major European bank closed its US carbon trading business this week in sign that 2012 is a “make-or-break” year for cap-and-trade’

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A major European bank closed its US carbon trading business this week in a sign that 2012 is a “make-or-break” year for cap-and-trade programs designed to fight climate change.

London-based Barclays determined the US carbon market, currently comprised of a handful of states, is too small to justify the expense of a dedicated trading desk in New York, according to sources familiar with the decision. Barclays was a major player in US greenhouse-gas trading programs on the East and West coasts and remains active in Europe’s carbon market, the largest in the world. Seth Martin, a Barclays spokesman, declined to comment.

Barclays Global Investors headquarters on Howa...

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“That is not good news for carbon-dioxide trading, especially not in the US,” says Gary Hart, a market analyst for ICAP Energy and a veteran pollution-rights trader. “There’s such uncertainty around the use of carbon cap-and-trade programs.”

The carbon cap-and-trade concept, which regulates the greenhouse gases linked to climate change by letting companies buy and sell pollution allowances, has suffered a major reversal of fortune since President Barack Obama’s election in 2008. Obama pushed Congress to create a national carbon market, by some estimates worth roughly $100 billion a year. The proposed market, similar to the European Union Emissions Trading System, caught the attention of major financial institutions, such as Barclays and JP Morgan, which saw U.S.-issued carbon allowances as a potentially lucrative new commodity.

“2012 could possibly be the make-or-break year” – Hart

But Obama later backed away from cap-and-trade when it floundered in the US Senate. That left a state-run carbon market in the US Northeast, where prices have crashed by more than 40 percent since 2008 and one of its members, New Jersey, quit the program entirely. Another state-level carbon market, estimated to be worth about $9 billion a year, was scheduled to start in California this year. But it was delayed until 2013 amid a legal challenge from environmental-justice activists who oppose carbon trading.

Even Europe’s carbon cap-and-trade program, in place since 2005, has been rocked by tax-fraud and computer-hacking scandals. Since Obama’s election, carbon prices there have plummeted about 60%, according to Paris-based environmental-trading exchange BlueNext, amid weak economic growth.

After a troubled few years on both sides of the Atlantic, carbon cap-and-trade advocates need to start turning things around this year, Hart says. “2012 could possibly be the make-or-break year,” he says.

Cap-and-trade supporters can already look forward to some wins in 2012. Australia plans to start a carbon tax in July, which will transition to a carbon market over three years, and Europe’s cap-and-trade program for greenhouse gases is expanding to include emissions from aircraft. In the US Northeast, the states of the Regional Greenhouse Gas Initiative are conducting a comprehensive review of their cap-and-trade market this year, and may recommend changes that lead to higher carbon prices.

But Hart says carbon-market observers will mostly be watching California this year to see if its environmental officials stick with the revised 2013 start date for the state’s cap-and-trade program. Few things could boost the carbon cap-and-trade concept more than the active involvement of California, the most populous U.S. state and ninth-largest economy in the world, Hart says. “That would keep it on life support, at least,” he says.

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About Mississippi Coal
Welcome! It is an honor to have a moment of your day. We are in favor of all forms of energy. We care about the future of this great Nation and seek to expose the corruption behind the Kemper County CO2 capturing experimental Lignite coal Demonstration unit. Our Chief complaint is that the rate payers pay for it in their electric bills. The CO2 capturing does not produce electricity so therefore serves no purpose for the ratepayers. It is a money scam for Mississippi power and Southern Company. Mississippi is first in following the (United Nation's Agenda 21) Kyoto Protocols for the regulation of carbon dioxide, a gas we breathe out of our lungs, by forcing the people to pay for it through energy bills and taxes. Through the process of investigating the Kemper County Coal Plant issue, we feel criminal acts have been committed and that soon FCC violations will be added to the offenses. People are being lied to, deceived, or misled and therefore are fully cooperating with this Lignite experiment. "This blog or any content may contain copyrighted material. Such material is made available for educational purposes, to advance understanding of political pathways, Constitutional infringements, democracy, science, and other issues. This constitutes a 'fair use' of any such copyrighted material as provided for in Title 17 U.S.C. section 107 of the US Copyright Law. This material is compiled and distributed without profit. This blog does not always agree with certain personal views or agendas of the published authors, but we will overlook such views many times in order to present facts, conclusions, and connections for knowledge or clarification. We hope you gain from this critical subject matter of the article/op-ed."

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