Creating a Carbon Trading Hub
Another sign: The growing Brickell Key headquarters of MGM International, a carbon-trading broker active in South America with promising enough growth that Morgan Stanley bought 38% of the company in 2006.
The global carbon-trade market is growing fast, with a 2007 cash value of $60 billion, up about 80% from $33 billion in 2006, according to Point Carbon consulting group. Most of that was in Europe and Japan, which regulate greenhouse gases. The United States didn’t sign the Kyoto Protocol, the international pledge to reduce emissions, and President Bush has opposed annual caps to decrease U.S. emissions over time. But caps are increasingly seen as inevitable here. Congress is warming up to the idea, and the presidential candidates support it.
Carbon trading is one way to meet government-set caps. Companies get allowances for their emissions, and if they emit less, they can sell credits to other companies that aren’t meeting allowances.
While the U.S. has so far avoided such systems, many states, including Florida, are working on their own. (Local communities, too, are beginning to embrace market incentives. Gainesville Regional Utilities, for example, has cut checks to customers for reducing carbon emissions.) In its most recent session, the Florida Legislature passed an energy bill that gives the Department of Environmental Protection rule-making authority to develop a cap-and-trade regulatory program (but not before 2010).
State officials see Miami as a carbon-trading hub not only for Florida, but for the Americas, and as a key center of trade between Europe and the Americas. “From an economic point of view, it makes sense, as Miami is already a banking center, and the infrastructure is there,” says Kathy Baughman McLeod, deputy chief of staff to Florida Chief Financial Officer Alex Sink. “Unfortunately, it is also the epicenter of sea-level rise, a symbol of our state’s geographic vulnerabilities.”
Indeed, the Organization for Economic Cooperation and Development has called greater Miami the world’s most vulnerable spot for climate change-related losses because of the value of its property in high-risk areas. In its latest report, the Miami-Dade County Climate Change Task Force recommends 35 key changes, on everything from zoning to Everglades restoration, to help defend against sea-level rise.
| Links: Read the Miami-Dade County Climate Change Task Force’s report. Also, the non-profit climate action organization Architecture 2030 has published an interactive map showing the impact of climate-induced sea level rise across the nation, especially in Florida. The photos show a conservative rise of one meter.
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