As the U.S. makes the seemingly inevitable transition to a carbon trading system in the next presidential administration - for better or for worse - the question remains as to what the rules of such a system will be and how such a complex system will be implemented and tracked. The private sector, which has seen green jobs booming despite a sluggish economy, is looking at the coming political and environmental landscape and not missing the point that they will have an opportunity to capitalize on this new market by helping the mechanism, whatever it will ultimately be, run effectively and efficiently.
In March of this year, a carbon trading exchange opened in New York - despite there being no formal American carbon trading scheme as of yet - and numerous companies and non-profits, including Brighter Planet, TerraPass, Native Energy and Carbon Fund, have already introduced a voluntary carbon market to the U.S. by offering various types of carbon offsets for purchase.
Now we learn that Meridian Energy in New Zealand, which is already active in the Dutch, Swiss and New Zealand carbon markets, has made a strategic early stage investment in a U.S. carbon software company - ‘CarbonFlow', based in San Francisco, CA. Around since 2006, CarbonFlow develops and markets software products for carbon market participants. According to the website "The CarbonflowTM Suite boosts the credibility of the carbon market through increasing standards, transparency, and scale."
The idea behind it is to simplify, systematize and automate what are certain to be complex, cross-jurisdictional, bureaucratic processes for creating and managing the carbon credit supply chain. The idea of transparency is very appealing, as long as it applies to knowledge among the general public. As has happened with the current EU trading scheme, lack of public understanding and over sight can lead to offset projects that are environmentally detrimental, such as that chronicled in The Carbon Connection.
The software also promises to help each private entity monetize their part of the chain, while helping to certify projects through data collection and management. This will be key as the U.S. tries to implement and tweak what some estimate will be a $1 trillion market by 2020.
While there are strong arguments against implementing a carbon trading scheme at all (and some satirical ones, as well), with both presidential candidates on board and the possibility of a lot of money at stake, those companies that get in early to help facilitate the system have a lot to gain.
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