Wed, Nov 20, 2019 - Page 9 News List

Green markets for equitable growth

By Graciela Chichilnisky and Peter Bal

A scheme offering market-based efficiency would appeal to developed economies, while developing countries would support it because mandatory emissions limits would apply only to high and middle-income economies, as was the case in the Kyoto Protocol.

The potential of a global carbon market continues to grow. Last year, the US National Academies of Science, Engineering and Medicine, and the Intergovernmental Panel on Climate Change reported that “negative emissions technologies” that remove and sequester carbon dioxide from the air could be safely scaled up to capture and store a significant share of total emissions.

This process would be so cost-effective that the captured carbon dioxide could profitably be sold in the carbon market.

Of course, carbon dioxide emissions are far from the only contributor to the climate crisis. However, other types of green markets can also be created.

Even before the Kyoto Protocol, the Chicago Board of Trade launched a private market for rights to emit sulfur dioxide.

The UN is now considering using similar markets to protect biodiversity and watersheds.

By enabling actors to buy and sell rights to use the global commons, such green markets naturally combine efficiency and equity. Yet the enduring North-South divide — and especially the rift between the US and China — is hampering our ability to seize their potential.

We have the tools to arrest, and even reverse, climate change. It is time to come together and use them.

Graciela Chichilnisky, a professor of economics and mathematical statistics at Columbia University, is director of the Columbia Consortium for Risk Management, and cofounder and chief executive of Global Thermostat. Peter Bal is a businessman and founder of the Millemont Institute.

Copyright: Project Syndicate

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