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Strategies & Market Trends : Booms, Busts, and Recoveries
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To: energyplay who wrote (54925)10/26/2004 7:01:09 PM
From: Taikun  Read Replies (1) of 74559
 
EP,

Imagine your firm is a major with big CO2 output in, say, Germany.

What you do is before any vote on Kyoto or greening you and your industry buddies (we won't use that word 'collusion') ramp up the cost of the carbon credits to show what a huge cost to industry Kyoto is. You show the numbers to the environmentalists who point and say that environmentalism works. You bemoan scrubbing technologies and contemplate layoffs and plant closures.

Then, after the measure fails due to political pushback from your jurisdictions, you let prices settle down and pull your bids. Maybe you throw some more credits into the system that your environmental engineers unexpectedly turn up.

Carbon credits traders...the future bond traders of the world.

David

EDIT: That is exactly what is being reported as happening. It is a new market, thinly traded, with even thinner regulation.
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