Since the Kyoto Protocol was ratified in 1997, carbon emissions have been making headlines. 2007 marked the 10-year anniversary of
Emissions associated with shipping had largely gone unnoticed and unregulated in the US until 2005, when lobby groups began arguing for international regulations for the industry, and even in the European Union, where groups had been working to regulate the industry for several years, governments were finding it difficult to effectively regulate an industry that crosses so many oceans and borders.
Developed countries such as the
The Chicago Climate Exchange (CCX) is an organized, voluntary, legally binding greenhouse gas (GHG) market. CCX members have committed to reduce their emissions by four percent and six percent by 2006 and 2010, respectively, relative to their 1998-2002 average. Members can purchase allowances from other members or credits from approved offset activities in order to meet their reduction commitments.
The over-the-counter segment of the voluntary market is differentiated from the organized market in that there is not a single marketplace or standard for these projects. End
users in the over-the-counter markets consist of companies as well as individuals that want to reduce or offset their carbon footprint.
Although smaller than the compliance markets, according to Scott Settelmyer of TerraCarbon, a financial services firm focused on carbon markets, the voluntary carbon market is quickly growing. In 2006, Settelmyer says, the worldwide voluntary market was estimated at 24 million tons valued at just under $100 million, split roughly evenly between CCX and the over-the-counter market. A recent survey of market participants indicated that this market is expected to grow from 25 million tons to between 400 million and 1 billion tons by 2012, driven in large part by greater consumer awareness and desire to offset emissions.
Theres a lot of activity in the voluntary carbon market among what people call corporate social responsibility or CSR buyers companies that want to project a green image by offsetting emissions but then youve also got a lot of growth being driven by businesses that are giving consumers the opportunity to offset emissions related with an event, a product or a lifestyle, Settelmyer says.The voluntary carbon market also exists even in those countries where carbon is regulated, Settelmyer adds. Certain industries, such as media, are not governed by the Kyoto Protocol requirements, but companies like News Corp. are participating in the carbon market nonetheless, purchasing offsets and reducing their carbon in an effort to go carbon neutral.
Carbon Offsets for Shipping
Carbon offset companies began appearing in the early part of the decade. These companies allow individuals, businesses and organizations to offset their emissions by funding carbon offset projects such as forestry, renewable energy or industrial gas projects that reduce greenhouse gas emissions.
Many see carbon offsets that directly target shipping emissions as a way to do something now, rather than wait for the slow wheels of legislation to turn. Although carbon offsets have been maligned by some as an easy way out of fixing emissions-related problems, they can provide an important part of the solution. Offsets help to remove pollutants from the atmosphere or prevent or reduce emissions and, in conjunction with legislation, innovation and corporate responsibility, can help to mitigate the impacts of the shipping industry.
Climate Legislation Catches up to the Shipping Industry
Legislation is currently in the works in
Regulating an international process such as shipping is a tricky thing. Its fairly straightforward to regulate emissions for trucks within one countrys borders, but regulating shipping emissions between countries is nearly impossible essentially, if one country does it, the rest will have to follow, which means that any country to propose a crackdown on emissions draws immediate criticism for unilateral action that affects an international industry.
Still, an international agreement is likely not far off. In April 2007, the EU Commission began drafting legislation addressing shipping industry emissions by including the sector in
With the global shipping market projected to triple by 2020 and an increasing number of shipping emissions regulations on the horizon, the time is right for shippers to take a hard look at the environmental and health impacts of their business and how best to mitigate them.
Jason Sperling is the founder and CEO of ShipGreen. ShipGreen, the first offset company to focus solely on shipping emissions, allows online retailers to add software to their websites that enables online shoppers to easily offset the emissions caused by their order shipments. For more information, please visit www.shipgreen.net, call 310-658-9374 or email Jason at firstname.lastname@example.org.