Isra-Mart srl:California, New Mexico weigh up joining US regional carbon market

www.isra-mart.com

Isra-Mart srl news:

California and New Mexico are considering developing a nationwide US carbon trading market by joining forces with other states in the north east, it emerged this week.

The two states, which are members of a multi-state and Canadian provincial scheme called the Western Climate Initiative, are mulling the possibility of partnering with the Regional Greenhouse Gas Initiative, a 10-state cap-and-trade system that is already operating in the north-eastern US.

Should the alliance go ahead, it would represent the first continent-wide effort to regulate carbon emissions through the use of market mechanisms.

The Western Climate Initiative has suffered its own challenges this year, following the failure of Oregon and Washington – both key members of the initiative – to secure legislation that would enable them to begin operating a cap-and-trade scheme as planned in 2012.

Until such legislation is signed, those two states will be unable to participate in proposed trading activities. Only California, New Mexico and the Canadian provinces British Columbia, Ontario and Québec have passed the legislation enabling them to begin cap-and-trade activities in 2012.

California is particularly enthusiastic about a cap-and-trade system, following the failure of a controversial piece of legislation called proposition 23 during the mid-term elections. Proposition 23 would have effectively overturned AB32, the climate change legislation imposed by governor Schwarzenegger, which makes a cap-and-trade system in the state possible.

Cap-and-trade advocates also suffered a blow earlier this month, following an announcement that the Chicago Climate Exchange (CCX), an initiative that facilitated the trading of voluntary carbon credits, would close its doors in December.

The CCX was purchased by the Intercontinental Exchange in Atlanta last April, but the system lost steam following the collapse of efforts to impose a federally mandated cap-and-trade system.