Carbon Offsetting - how everyone in the media is discovering what a fucking fraud it is

Channel 4 have a Dispatches program tonight exposing the fraudulent "carbon offset" bizniz which Lord Patel has been doing for a long time -see all these posts.

It is called The Great Green Smoke Screen Channel 4 News science correspondent Tom Clarke dissects the many 'solutions' to global warming being marketed to onsumers, from tree-planting and carbon offsetting to green energy tariffs, and reveals how attempts to buy our way out of climate crisis may (good weasel word here - don't commit yourself Tom) be making things worse.

He is not the only one.. this is a good place to start ...

"Carbon Trading: A Critical Conversation on Climate Change, Privatisation and Power" a product of the Dag Hammarskjold Foundation.Which they call their Development Dialogue 2006:September, no.48 You can download (PDF alert) the whole 350 odd pages or (recommended) 6 seperate chapters.

OR

Better still obtain a free copy by e-mailing Kajsajsa.overgaard@dhf.uu.se or (in Britain only) larrylohmann@gn.apc.org or secretariat@dhf.uu.se or Fax: +46-18-12 20 72

This is how they outline the plot in an arch and quaint fashion but does give you an idea of the content - read and judge for yourself.

Chapter 1 A new fossil fuel crisis/ In which the growing climate crisis is traced mainly to the mining of coal, oil and gas; the dangers to survival and livelihood are outlined; the political nature and implications of the problem explored; and reasonable and unreasonable solutions sketched.

Chapter 2 ‘Made in the USA’ / A short history of carbon trading In which the surprising story is told of how corporations, academics, governments, United Nations agencies and environmentalists united around a neoliberal or ‘market’ approach to climate change emanating from North America.

Chapter 3 Lessons unlearned / In which carbon trading, contrary to slogans about the universal eff ectiveness of markets in dealing with environmental and social problems, is shown to be ill-suited to addressing climate change. The experience of the US in pollution trading is demonstrated to be an argument not for, but rather against, making carbon markets the centrepiece of action on global warming.

Chapter 4 Off sets / The fossil economy’s new arena of conflict In which it is shown how projects designed to compensate’ for continued fossil fuel use are helping to dispossess ordinary people of their land, water, air – and futures.

Chapter 5 Ways forward / In which the claim that ‘there is no alternative’ to carbon trading is dissected and set aside, and emerging alliances for a more democratic and effective climate politics are explored.

Pollution trading the authors have belatedly recognised is a completely new idea, foisted on the world by a small circle of neoliberal institutions in the US. Surprise - Surprise !! Pollution trading’s main appeal is that it promises to save make money for the rich over the short term.

As a pollution control policy, it is sure to fail..... ahem .. in Europe where it HAS been tried ...it has FAILED ... the ETS market closed on Friday at just 12 cents, the lowest ever....having made a lot of traders, lawyers, accountants, banks very rich on the way and many credulous investors much poorer.All credit to media lens for finally realising what twats they have been all these years as the wool has been ever so gently pulled over their eyes... quite how difficult is it to deprive children of their candy ?

Pssssst.... want to stop somebody doing something? - tax and regulate, admittedly it has limited itility eg. European fuel taxes cf USA ... but of course it depends what you do with the taxes you raise.. the European Gubments just piss them up against the wall.

Anyway read the report - 350 pages but it's big type on artfully landscaped pages and the text boxes a la US textbooks makes reading easier ... the Bibliography is excellent. See also ....See also "Obscenity' of carbon trading" by Kevin Smith in the BBC Green Room , he is a researcher with Carbon Trade Watch, a project of the Transnational Institute which studies the impacts of carbon trading on society and the environment.Also by him "Stern Words While in Europe They are trading Hot air" also at (http://www.thepolitician.org/)

"Labour MP Gerry Steinberg described the scheme as a ‘mockery’ and an ‘outrageous waste of public money’.""A massively generous allocation resulted in windfall profits for some of the UK’s most polluting companies, to the collective value of £940 million according to Franck Schuttelar, an analyst at the energy-trading firm Gaselys

.""Waiting yet more years to learn further lessons from the next round of
ineffective emissions trading is a luxury we don’t have."

See also his "Carbon Cop outs" - He is also co-author of The Carbon Neutral Myth: offset indulgences for your climate sins, forthcoming in January 2007.See also Climate Fraud and Carbon Colonialism: The New Trade in Greenhouse Gases (pdf alert)by Heidi Bachram CAPITALISM NATURE SOCIALISM VOLUME 15 NUMBER4 (DECEMBER 2004)
"The changes necessary to avert climate catastrophe are simple enough, namely, a switch away from fossil fuels and to renewable energy like solar and wind, along with a reduction in energy use generally."

You can watch Channel 4 Live on the net anywhere by going here and logging in.

An infuriating program with a few nuggets of information and a lot of footage of the telegenic reporter sitting at a laptop loking puzzled.

It has been said before ... carbon offsets are the equivalent of the mediaeval church selling indulgencies - if you don't know what they are Google it.

There is one effective way to reduce carbon dioxide emissions - and New Zealand have recently introduced it. An energy tax. Not the complete answer, not the only answer but a good start. Carbon trading just fills the wallets of financiers and their lawyers, advisors, consultants, and PR boosters. They found their top shill in the hapless, hopeless, chinless Margaret Beckett who thankfully appears to have gone to that great Caravan in the sky.

media lens - distorted visions corrected - at last

media lens is a website.

It claims to correct the distorted vision of the corporate media. It's a haven for humourless, muddle aged, muddle class, muddle brow media shit stirrers. These dysfunctional mutual back slappers maintain a cautious and Buddhist inspired and untroubled resevoir of careful comment - that spends endless time berating the BBC , Independent and Guradian Newsdesks over arcane points of textual analysis. They must absolutely fucking hate them.

About us, outs their tedious philosophy by their juvenile and unformed and uninformed ideas of which they say revealingly ..."We have to acknowledge the debt we owe to Edward Herman and Noam Chomsky, and in particular to their brilliant (and largely ignored) text, 'Manufacturing Consent - The Political Economy of the Mass Media'. (Pantheon, 1988) " ... you can just smell those socks and sandals and hear the scratchy Santana albums.

In truly Damascean fashion they have however finally understood that the whole post Kyoto scaremongering and deployment of the insane emissions trading scheme is a capitalist scam, perpetrated by capitalist scum.

The revelation .... "New Book Exposes Scandal of Carbon Trading" they belatedly recognise .. this is the unhandy sized "Carbon Trading: A Critical Conversation on Climate Change, Privatisation and Power" a product of the Dag Hammarskjold Foundation.Which they ca;; their Development Dialogue 2006:September, no.48

You can download (PDF alert) the whole 350 odd pages or (recommended) 6 seperate chapters. OR better still obtain a free copy by e-mailing Kajsajsa.overgaard@dhf.uu.se or (in Britain only) larrylohmann@gn.apc.org or secretariat@dhf.uu.se or Fax: +46-18-12 20 72

This is how they outline the plot in an arch and quaint fashion but does give you an idea of the content - read and judge for yourself.

Chapter 1 A new fossil fuel crisis
In which the growing climate crisis is traced mainly to the mining of coal, oil and gas; the dangers to survival and livelihood are outlined; the political nature and implications of the problem explored; and reasonable and unreasonable solutions sketched.

Chapter 2 ‘Made in the USA’
A short history of carbon trading In which the surprising story is told of how corporations, academics, governments, United Nations agencies and environmentalists united around a neoliberal or ‘market’ approach to climate change emanating from North America.

Chapter 3 Lessons unlearned
In which carbon trading, contrary to slogans about the universal eff ectiveness of markets in dealing with environmental and social problems, is shown to be ill-suited to addressing climate change. The experience of the US in pollution trading is demonstrated to be an argument not for, but rather against, making carbon markets the centrepiece of action on global warming.

Chapter 4 Off sets
The fossil economy’s new arena of conflict In which it is shown how projects designed to compensate’ for continued fossil fuel use are helping to dispossess ordinary people of their land, water, air – and futures.

Chapter 5 Ways forward
In which the claim that ‘there is no alternative’ to carbon trading is dissected and set aside, and emerging alliances for a more democratic and effective climate politics are explored.

Pollution trading the authors have belatedly recognised is a completely new idea, foisted on the world by a small circle of neoliberal institutions in the US. Surprise - Surprise !! Pollution trading’s main appeal is that it promises to save make money for the rich over the short term. As a pollution control policy, it is sure to fail.

.... ahem .. in Europe where it HAS been tried ...it has FAILED ... the ETS market closed on Friday at just 6 Euros, the lowest ever....having made a lot of traders, lawyers, accountants, banks very rich on the way and many credulous investors much poorer.

All credit to media lens for finally realising what twats they have been all these years as the wool has been ever so gently pulled over their eyes... quite how difficult is it to deprive children of their candy ?

Pssssst.... want to stop somebody doing something? - tax and regulate, admittedly it has limited itility eg. European fuel taxes cf USA ... but of course it depends what you do with the taxes you raise.. the European Gubments just piss them up against the wall.

Anyway read the report - 350 pages but it's big type on artfully landscaped pages and the text boxes a la US textbooks makes reading easier ... the Bibliography is excellent.

Thanks to the two Daves .. welcome to the real world.

See also ....See also "Obscenity' of carbon trading" by Kevin Smith in the BBC Green Room , he is a researcher with Carbon Trade Watch, a project of the Transnational Institute which studies the impacts of carbon trading on society and the environment.

Also by him "Stern Words While in Europe They are trading Hot air" also at (www.thepolitician.org)

"Labour MP Gerry Steinberg described the scheme as a ‘mockery’ and an ‘outrageous waste of public money’."

"A massively generous allocation resulted in windfall profits for some of the UK’s most polluting companies, to the collective value of £940 million according to Franck Schuttelar, an analyst at the energy-trading firm Gaselys."

"Waiting yet more years to learn further lessons from the next round of ineffective emissions trading is a luxury we don’t have."

See also his "Carbon Cop outs" - He is also co-author of The Carbon Neutral Myth: offset indulgences for your climate sins, forthcoming in January 2007.

See also Climate Fraud and Carbon Colonialism: The New Trade in Greenhouse Gases (pdf alert)by Heidi Bachram CAPITALISM NATURE SOCIALISM VOLUME 15 NUMBER4 (DECEMBER 2004)

"The changes necessary to avert climate catastrophe are simple enough, namely, a switch away from fossil fuels and to renewable energy like solar and wind, along with a reduction in energy use generally."

SinksWatch is an initiative to track and scrutinize carbon sink projects that has useful information on CDM project scams.

HM Treasury brainwashed by carbon trading - well in the case of Kitty and Hilary it just needed a light rinse

Brainy, beautiful, dutiful Kitty Ussher , Economic Secretary to the Treasury, gave a speech to the Institute of Chartered Accountants of England and Wales (ICAEW) at their "Making carbon markets work' event on the 4th October 2007.

This can be consulted at the HM Treasury website as 32 numbered paragraphs ... No 32 consists of two words.... Thank you.

She kicks off by repeating the mantra of the meddling classes ..."I believe carbon trading can play a very significant part, and in fact needs to play a very significant part, in the way that we tackle climate change, both here in Britain and worldwide." Carbon trading she says has to be credible, effective and accountable... which judging by Round One of the ETS it is none of those things.

Well versed in the Stern report's nonsense she picks up on the need (and importance) to give carbon a global price, we can cost the damage of carbonemissions – we can internalise the externality, to use the economists’ jargon - reminding us of course that she is practised in the dismal science.

Of the many ways of creating that price – HMG she says believes that a very important way of doing this is the trading of carbon emissions - not only that , but here is the really scary bit -
"We want it to be strengthened in the future, with limits that tighten over time to create scarcity, and we want it to be expanded – to cover more sectors and more gases, and also to link, eventually, with schemes in other countries."

" ....carbon pricing can only be fully effective if we can create a global price ... which means a global carbon market."

It must have been at this stage that here deep brown eyes started whirling as she set off on a global journey - California .. indeed other US States - it won't be easy - challenging - opportunities ... financial services.

It must have beenat this stage that the asembled accountants stood on their chairs and cheered.
" .... global carbon trading market is worth $30 billion a year – and we expect it to increase significantly in future. This is a new market, and a new opportunity for the UK, and for London in particular ....." London is already the world’s leading financial centre for emissions ..." there musn't have been a dry pair of Calvin Kleins in the room.

Adrenalin racing the pert, petite brain box rattled on ... annual turnover ... environmental goods and services sector... £25 billion in the UK ....... double ....... creating at least 100,000 jobs.

The assmebled money jugglers rolled in the aisles with glee.

"So there are some real opportunities for a green economy and a growing economy – and carbon trading can be at the heart of that." - M & C Saatchi never came out with a better line - just feel it , roll it round your mouth ...."real opportunities for a green economy and a growing economy " all those nights at Balliol studying the rhetoricians.

a green economy and a growing economy - remember that one , you are going to hear it very often.

... er ...32. Thank you.

Now her boss has produced his 3 year Stalinist Plan Pre-Budget Report and her pal Environment Secretary Hilary Benn has added a few hard edges to all this hgh flown rhetoric.

The new measures young and vibrant Hilary announced include:

* Air Passenger Duty to be replaced with a 'per plane' tax from 1 November 2009 to make the tax better fit the environmental impact. So far this is just a "good idea" and HMG will be consulting.

* A commitment (?) to increase the use of auctioning for EU Emissions Trading Scheme (ETS) permits for Phase III, with a significant increase in the level of auctioning for large electricity producers to improve the efficiency of the scheme and tackle windfall profits that have occurred in this sector;

* Confirmation (?) that Climate Change Agreements will be extended until 2017, subject to state aid clearance; and

* Measures to encourage energy efficiency and new technologies, including a push in Europe to speed up action to improve energy efficiency in consumer goods and to reduce the rate of VAT for the most energy-efficient products, consulting on the UK's product standards and providing incentives for businesses to install microgeneration.

The Government will also aim to ensure that future phases of the EU ETS will continue to recognise the carbon savings delivered by Combined Heat and Power (CHP) facilities.
Internationally, a fund will be established at the World Bank as a mechanism for delivering the international element of the Environmental Transformation Fund, announced in this year's Budget.

Which means we will have to wait until Europe approves / catches up / agrees.

The contribution of the UK to global warming is virtually zero. The sole contribution we can make is to reduce fossil fuel consumption - we need to do this as the forthcoming UK energy deficit looms. (FCUKED) - exhortation, fancy trading schemes manufactured, massaged by nameless unelected civil servants whilst the City money juigglers skim the cream is no way to do it.

The only way to cut fossil fuel consumption is to make it too expensive. Tax it. We have been taxing oil at hideously punitive rates for decades throughout Europe - if serious we have to impose those taxes harder and wider.

Carbon trading is just another chip being forged in the casinos of the city, nicely timed to slot in as the trading of "securitised Special Purpose Vehicles" hits the buffers, following mis-sold pensions, and endowment policies (remember those ?).

Carbon Black Wednesday

The EU contribution to the Kyoto Protocol involves the establishment of an Emmissions Trading scheme (ETC).

The ETS is a scheme whereby each government sets an overall cap on the CO2 emissions from its heavy industries and then allocates emissions allowances to each industry within the scheme. Each industry can then decide whether to reduce it emissions eg. by investing in energy efficiency measures, or exceed them and buy more CO2 allowances on the open market - whichever is cheaper for that particular industry. In this way, if the overall cap is set low enough emissions trading provides a cost effect way to cut CO2 emissions.

Domestically, the EU's Emissions Trading Scheme, which encourages companies which can reduce emissions to do so cheaply and to sell unused allowances, will remain a central feature of our climate change policy.

Each country was supplied with a "cap" or maximum level of CO2 emissions measured in metric tonnes of carbon. This did not include transport (incl. aeroplanes), human breath (or animals) or domestic heating. It was based on (mainly) large industrial users of fossile fuels. In anticipation of the likelihood that some producers would reduce carbon and some not it was envisaged that carbon crdits from thrifty users could be sold to excessive producers.

In the UK Mrs Beckett was a huge fan of this scheme and she was to found (and heard) loudly claiming wonderfu(e)l benefits of the scheme.

On January 11th 2005 Lord Patel wrote

"The bearded be-jersied Branson has a letter in the FT today calling for Emissions Trading organised by the Intnl Civil Aviation Org. ICAO, the Airlines cabal... full of " minmising environmental costs"..."delicate marine environments" (don't go by boat)..incorporating shrewdly self congratulation..." Virgin ...has one of the youngest fleets in the world...our emmission on take off fell significantly " (this has no connection with their much touted double beds, apparently).

The Carbon Market is a clever and elaborate ploy to erect yet another casino for Financiers and other money jugglers to play in, Barclays claim it will be worth £56Bn. a year in the UK alone - they as well as Cantor Fitz. BP etc., will be glad to cream off their commissions on this nonsense. By all means Mr Branson, add this burdensome cost to every aircraft flight and play the market - much easier than flying the planes.

I am stunned by the naivity of the tree huggers who embrace this nonsense, who have some mystical belief in the environmental concerns espoused by the market traders of Leadenhall Street.

The Carbon Trust, responsible for this nonsense has a Chief Execitive with a magnificent pedigree, he comes straight from Rail Network where he did such a splendid job for the rail user. "

The Financial Times High prices attract funds to carbon trade scheme, May 25 2005, the day after trading commenced at Euros 19 per tonne.

Hedge funds, attracted by rising carbon prices, have started to invest in the fledgling market in greenhouse gas emissions.

James Cameron, founder of the boutique (?) investment bank Climate Change Capital, said his company had received commitments from several hedge funds. He said the amount was greater than $100m (£54.7m) and could rise to $500m (£273.4m). "It's a new market, but attached to markets [in energy and commodities] that funds understand," he said.

Laurent Segalen, director of the European Carbon Fund at Ixis, said several hedge funds had expressed an interest in the fund. "This is still at an early stage for many of them but in six months' time I expect to see them in the market in larger numbers," he said.

She added that the opening of the UK's carbon registry would boost the City of London, which has become an international centre for the carbon trading business.

Anthony Hobley, senior associate at the law firm Baker and McKenzie, said: "As a result of early commitment to the area by the UK government what has developed in London is one of the biggest concentrations of expertise [on] greenhouse gas emissions trading. Many of the contracts are based on English law, and already the City is working on some sophisticated financial products around carbon."

Well time has moved on and the price has inexorably risen to Euro31 a tonne, egged on and carefully massaged upwards by the sharp suited gents in the city.Then ...

On Wednesday (Carbon Black Wednesday as it will be known soon) a clutch of countries reported week that their 2005 carbon dioxide (CO2) emissions were far below expectation, crashing demand for permits to pollute and so taking the floor from underneath the EU's carbon credit market.

In the past two days, the Czech Republic has said it emitted about 83m tonnes of carbon last year, about 15 per cent below the national cap. The Netherlands said its CO2 emissions for 2005 were 80.4m tonnes, or 8 per cent below its national cap. Estonia came in about 25 per cent below its cap of about 16m tonnes, and the Walloon region in Belgium was 15 per cent lower than the alloc­ation of its carbon allowances last year.

Late Wednesday afternoon, France said its carbon dioxide emissions were 11.6 per cent below the country’s EU quota.That totals some 17% of Europe.

As a consequence the bottom literally fell out of the carbon market and reached as low as Euro 14 per tonne today. It also dragged down power generators and energy supply companies with it. (Graph Euros / last 30 days)

Fears of significant cuts in energy companies' future profitability saw the UK's biggest generator, British Energy, the country's single largest power plant, Drax, and British Gas group Centrica led the FTSE 100 fallers, slipping more than 3% because the the market now be awash with unused carbon dioxide permits.

Paradoxically ultra clean nuclear generators like British Energy emitting no carbon dioxide will, perversely, be hardest hit as they lose profit margin on the falling price of generated electricity but get no gain from reduced costs in emissions trading.

The market waits with considerable fear as Britain, Germany, Italy, Poland and Portugal -- who must between them announce by May 15 must show a need for 36 million tonnes short of carbon credits to avoid a complete price collapse.

"It's precariously balanced," said Louis Redshaw, Head of Environmental Markets at Barclays Capital. "It feels very edgy round here."

"Unless that 40 million tonnes gets wiped out pretty quickly this commodity could be worthless," said a trader."If there's a (net carbon credit) surplus there's no incentive to reduce emissions and the (carbon) price collapses. It won't go to zero, it would effectively go down to the administrative cost of the scheme... it could be 1 euro, who knows?"

Utilities are particularly exposed to the drop, both because of a fall in power prices and because some have on their balance sheets millions of tonnes of carbon credits, whose value has dived.

This emissions undershoot has left traders pointing the finger at companies and countries for inflating those figures, to minimise any financial impact of the scheme.

"This does potentially strengthen the political hand of the European Commission in relation to phase two National Allocation Plans," said Anthony Hobly, general council to the Climate Change Capital fund,(CCC focuses on companies and financial institutions affected by the regulatory and capital market responses to climate change) which has over US$150 million invested in carbon markets.http://www.climatechangecapital.com/

“It does raise the question whether there were too many permits issued and that the governments may have got it wrong,” says Louis Redshaw, associate director at Barclays Capital.

With German utilities holding about 14 per cent of the total EU CO2 permits, the share prices in RWE, E.ON and Vattenfall Europe were all pulled lower on Wednesday by the lower CO2 prices.

What we are seeing is a convergence of capital and environmental markets," Richard Sandor of the Environmental Financial Products Company told the Financial Times. Like other global financial markets, the emissions market will also feature transactions that are purely speculative. Trading house Mitsubishi, for instance, envisages "a business in which we purchase emission rights at low prices and sell them at higher prices for profit." "The potential rewards for smart players in the field are enormous," according to Natsource, a New York-based "over-the-counter broker of energy derivatives." Not only will emissions credits be traded, their derivatives will also constitute a billion dollar market. Hedge funds will also undoubtedly find a niche, as will speculating in 'futures' and 'options'. There is a real danger that the entire range of controversial speculative instruments known from the global financial markets could emerge in the emissions trading game.

These were typical, revealing remarks from the emerging class of new, fast-growing profession- emissions brokers up till Carbon Black Wednesday. Of course they were nothing but snake oil salesmen. Hucksters, shysters, swindlers, swilling someone's money around the City casinos on a rsing ballon fed with hot air from Mrs beckette, supported by the highly adept City PR army.

We are now faced with the spectacle of that casino collapsing - overnight and losses , which will inevitable land on consumer's energy bills that have gone to feed the city fat cats - who have swung the politicians and the tree huggers along in a fenzy of righteous and unfounded speculation.

January 11th 2005
Barclays claim it will be worth £56Bn. a year in the UK alone.

April 27th 2006
"It's precariously balanced," said Louis Redshaw, Head of Environmental Markets at Barclays Capital. "It feels very edgy round here.


“It does raise the question whether there were too many permits issued and that the governments may have got it wrong,” says Louis Redshaw, associate director at Barclays Capital. ("Not my fault Guv if I was hopelessly sucked in")

One of the main roles of the Barclays Capital Energy Team is to introduce the concepts of energy price risk management to companies who are exposed to the uncertainties of energy price movements....... What do the Germans call it ? Schadenfreude ?

Carbon Black hole - ETS price drops 23% in one day.

The price of carbon on the European Trading System dropped yesterday (Monday 6th January 2007 ) to €3.88 .... 0.87 cents down - a drop of 23%, yet again the lowest ever - remember it was over €30 in May.

The market closed down a further 10% (38 cents) today Tuesday 9 January 2007 @ €3.50.

How long is it going to be before the market collapse and the fraudulent trading in this smoke and mirrors show can be kept out of the MSM ?

UPDATE MIDNIGHT GMT TUESDAY 9th Jan.

On BBC2 Newsnight Sir Nicholas Stern the mild mannered, distinguished development economist and former chief economist at the World Bank, with a reputation as a skilful and highly rated academic, a person of intellectual discipline and rigour spoke to Jeremy Paxman the house trained polecat of the Beeb.

Without a trace of a smile, nor sign of his sizeable tongue in his cheek he explained how the high price of carbon that the ETS scheme would result in, will change economic behaviour making people use less electricty, fuel etc., use more fuel efficient cars etc.,

This whilst carbon trades at it's lowest price ever, havinf lost 1/3rd of it's (very much reduced) value in the last 2 days ,which both Stern and Paxman(if they were aware - which is unlikely) failed to mention.

This impeccably qualified academic chatters on about creating a global market for carbon pricing by extending the existing European Emissions Trading Scheme ( the one that's fast disappearing down the toilet) to include countries such as the United States, India, and China. Meanhwile Mr Putin plays with his oily spigots ....

Sleepwalking to economic disaster.

================================

If you are wondering what this means - take a concrete example of how carbon trading works.

The UK Gubment are committed to offset GHG emissions from air travel by government staff from April 2006. (The Foreign and Commonwealth Office and the Department for Culture, Media and Sport have their own emissions reduction commitments - don't ask why that's how Gubments work - it's called joined up Gubment)
.
The UK Gubment does this by buying credits from UK-based emissions trading fund Trading Emissions PLC (Y/E 30/6/2006 Turnover £7.21 Mn Profit £3.49 Mn)In this instance some other hooray Henries called EEA Fund Management Ltd got a share of the action as well - follow link for details)

On 28th December 2006 (last week - PAnews/20060029/32377087 and more details here) Trading Emissions sold 225,000t of certified emissions reduction (CER) credits to the UK government carbon offsetting fund at £9.76/t = Euro 7.40 (US$19/t), or 90pc of the price of 2008 EU emissions allowances(tender bid total £2.5 Mn 1/3rd of Annual T/O). The government has the option to buy a further 50,000t of CERs = £0.5Mn. (Today's price is somewhat less at £5.20 = Euro 3.55 - see graph) - smart buying eh ?

“The government is increasingly aware of the environmental impact of air travel and this is a way to mitigate unavoidable emissions,” a spokesman for the Department of Environment, Food and Rural Affairs said.

The credits will be generated from small-scale renewable energy and energy efficiency clean development mechanism projects, one of the flexible mechanisms under the Kyoto protocol such as Sri Lankan villagers using Photo voltaics to generate daytime electricity to run domestic low voltage lights in the evening , TV's etc instead of using paraffin fuelled lighting...or Brazilian farmers preventing methane escaping from pig ..er...shit.

One CER will offset the emissions from around 10,000km of air travel — nearly enough for one London-New York return trip, according to the CarbonNeutral company.

All this hasn't stopped a single kilo of jetfuel being burnt - but it gives some folks in Whitehall and Westminster with a nice warm feeling , and of course a Carbon Trader with a fancy commission and if he/she anticipated the market dropping (ie they read Lord Patel on a regular basis) they could have dealt themselves a nice fat trading profit on top - which no doubt they did.

That is what Lord Patel means when he talks about the casino that carbon trading is..a casino that is fed very often with taxpayers money.

Carbon Black Hole gets bigger and better - Financial PR gets into top gear

Four news items relating to the carbon trading market hit the headlines today:

1. The EU energy ministers have rejected the European Commission's proposal to introduce a binding target for renewable energy of 20 % by 2020.

2. The EUA Dec 2007 price for one ETU (= 1 Tonne CO2) reached the lowest price ever of €1.23 = 82 p = 98 US Cents

3. The Chicago Climate Exchange (North America’s only, and the world’s first, greenhouse gas (GHG) emission registry, reduction and trading system for all six greenhouse gases ) has suspended its programme that allowed EU allowances (EUAs) to be used to meet CCX emission reduction compliance requirements – over fears that the CCX would be flooded with cheap credits from Europe - thus knocking back attempts at establishing and developing a "world market in carbon."

4. " Greed is motivating Wall Street to join the fight against global warming." says an article today by Bloomberg

Climate Exchange PLC (issued late '04) shares rose 13% , up 107.50 to 955p (they have been 1237pa and took off in September ) which values the company at £394 Mn. The company has no revenues, no income and a net asset value of £29 Mn but have what is considered (like a Canadian owned Kazakh goldmine) a very good story to justify this phenomenal valuation. The company can be contacted C/O Barings (Isle of Man) Limited, St James’s Chambers, Athol Street, Douglas, Isle of Man IM1 1JE.

The company now own and operate Chicago Climate Exchange("CCX") and Chicago Climate Futures Exchange ("CCFE") and (Trading website here )issued a statement of trading on 22nd January 2007. The highlights of which were ...

"All the key performance indicators showed a substantial increase over the same period in 2005. The political climate in the U.S. has become increasingly receptive and the profile of climate change has been significantly raised. (see below) CCX and CCFE are well positioned to benefit from these circumstances and have been able to achieve significantly increased volumes and liquidity."

In 2006, CCX traded a total of 452.8 Mn Tonnes of CO2 (2005 = 94.3 Mn T) of which 175.9 Mn T (39%) was in futures and 276.9 Mn T 61%) was in Exchange of Futures for Physical ("EFPs") . Average daily volume traded during the year was 1.8 Mn T ... in other words they didn't actually trade (i.e actually buy and sell carbon they merely allowed the trading of promises to deliver (Futures) and and even fancier "derived" product Exchange of Futures for Physical ("EFPs").

On the 20th September 2006 Goldman Sachs Group Inc. agreed to subscribe for 4,174,467 new Ordinary Shares at a price of 293 pence, representing some 10.1 per cent of Climate Exchange on the 9th of February they announced this had increased to 8,352,041 ordinary shares of 1p each in the Company, representing 20.21% of the Company's issued share capital of which roughly half are held as Nominees for their customers. Read about their "Green Biz strategy here.

On 12th February 2007 Cayman Islands based Harbinger Capital Masters Fund 1. Ltd and Harbinger Capital Partners Special Situations Fund, LP announced their interest in 4,287,000 ordinary shares representing 10.4% of the Company's issued share capital.

Glenn Payne, Director of First Reserve Corp., the biggest private equity firm in the energy industry (US$12.5 Bn under management) , says `Giddy returns'' are probable (perhaps he "meant irrational exuberance" ) which will lead to a quintupling of credit values to around $19 per ton of carbon dioxide, from $3.50 now. In April CO2 was trading on the ETS at US$43 and today at US$ 0.92.

Elswhere Bloomberg reports the climate change fever has gripped the New York money jugglers Bankers.

1. Morgan Stanley, 2nd largest securities firm, plans to invest US$3 Mn over the next 5 years $3 billion of programs to cut greenhouse gas pollution or in the credits that result.

2. Citigroup Inc. and Minnesota-based Cargill Inc., the largest U.S. agricultural company,have agreed on a joint venture to buy shares in Sindicatum Carbon Capital Ltd. to generate carbon credits. See the full Business Wire story 13/2/07 here. Deputy Chairman of of SCC is Lord Stone of Blackheath (Votes as a Labour Peer) who spent a lifetime with Marks and Spencer ( he left school with 5 'O' Levels - 1 of them in woodwork) and retired as Joint MD in 1999. See Footnote.

3. First Reserve have contracted with struggling, cash strapped, Tyson Foods Inc. to buy carbon credits generated by cleaning up the methane from its chicken scraps and wastewater ponds which they can then sel on to companies that need to meet state or federal pollution limits.

They have signed similiar contracts with Arkansas truckers, J.B. Hunt Transport Services Inc. and the Boise, Idaho-based Albertson's grocery chain from greenhouse gas reductions replacing truck fuel with biodiesel and installing energy efficient store lighting.

Unbelievably Payne is also quoted, saying " The market in Europe, where greenhouse gas emission caps have been in place for two years, shows how high the value of U.S. credits will climb."

4. As ever the bearded jersey generates heat and excitement and his announcment with Al Gore, inventor of the Internet and responsible for the film, "The Uncomfortable Truth" of a $25 million prize for anyone who can devise better and more efficient ways to reduce and store CO2 helps to keep the pot boiling.

5. Germany's E.ON AG, the world's largest utility, said Feb. 7 that it will acquire credits by investing with banks in projects that curb greenhouse gases in the developing world.

6. Electric generator manufacturers, General Electric Co., and power plant builder AES Corp. of Arlington, Virginia, announced on Jan. 14 (4 pages PDF)that they created a joint venture for carbon emission credits with which they intend to cut U.S. greenhouse gas emissions by 10 million tons each year, creating 10 million credits, ``Our goal is to make this a viable business in a voluntary market and be a leader as it becomes regulated,'' he said. (Which makes you wonder if this remarkable rush for this evanescent market is based on more knowledge of the proposed legislation than has been made public)

“AES is committed to helping address climate change as part of our broader alternative
energy strategy,” said Paul Hanrahan, President and CEO of AES - which is a remarkable thing for the major US producer of coal burning power stations to say in public.

“This initiative will help GE Energy Financial Services double its already sizeable $1.5 billion portfolio of investments in renewable energy projects by the end of 2008, and will contribute to GE’s ecomagination program,” said Alex Urquhart, President and CEO of GE Energy Financial Services. ..Through its Ecomagination program,"

Ecomagination program - Dontcha just love it when they talk not-dirty like this ?

A great deal of this froth of speculation is based on the belief that Congress will approve a law to reduce emissions of carbon dioxide, methane and other gases that cause global warming. Beautiful grandmother and darling of AIPAC, House Speaker Nancy Pelosi, a California Democrat, said last week that ``mandatory action'' is needed to cut emissions in half by 2050. Even the President in his State of the Union address, perhaps signalled a change to the money jugglers when he talked of the need to ..."confront the serious challenge of global climate change'' (6 Buzz words and 2 prepositions in 8 words)

The article headlined the apparent 45% return that Isle of Man based Trading Emissions Plc, made in selling 255,000 credits to the U.K. government at about €14.50 euros a ton which they acquired in late 2005 and early 2006 for less than €10 euros each - when the market price today is € 1.23. A good sale ...or a lousy purchase ?

Speculators, including hedge funds, are replacing industrial companies as the biggest buyers of carbon credits, according to Greg Spencer, chief executive officer of Blue Source, founded only in 2001 - a Salt Lake City-based company that develops greenhouse gas projects (Blue Source has entered into the single largest US-based offset sale to date, at 9 Mn tonnes and has secured under long-term sourcing to the year 2019. ) in which First Reserve Corp have taken a 50% interest . . ``It's more about taking positions in a market that will appreciate significantly over time,'' .

Which sounds an awful lot like gambling ... or rigging the market ?

Footnote
Lord Stone of Blackheath is, amongst many other interests, Deputy Chairman Sindicatum Carbon Capital Ltd., and Director of seriously loss making DealGroupMedia plc, and of the seriously profitable N Brown Group plc which announced on 25th Jan 2007 a return of £89 Mn to shareholders as a special dividend of 27p per share. He is an Advisor to McDonald’s Restaurants, a Governor of the Weizmann Institute of Science and of the European Council of Ben Gurion University, a member of The Israel Britain Business Council and The Labour Friends of Israel , Patron of the enlightened New Israel Fund (see this story re Arab Housing) and has a lifelong interest in the process of creating understanding and toward peace in the Middle East.

Carbon Trading market collapses - Kyoto down the pan

EC pollution policy in disarray as carbon permit prices crash
By Edmund Conway, Economics Editor Daily Torygraph 29/4/06

"Louis Redshaw, head of environmental markets at Barclays Capital, said this suggested the carbon allowances handed out by the European Commission at the start of the scheme last year had been too generous.

"In that situation the allowances are potentially worth nothing," he said. "It's not good that we should have such volatility in the market. But the silver lining is that the EC will be much stricter about its assessment of national allocation plans in the future." Ho. Ho !

It is almost impossible to believe how dumb the people are who say such things. This whole thing is a casino contrived to make money for the shysters and money jugglers of the Square Mile ... who have their second Jamboree in Cologne next week.

But perhaps not so dumb and naive as this Tree Hugger the Torygraph quote .."Martin William of Friends of the Earth said:

"If you don't set the cap at a tough enough level then the whole market system falls apart. You are allowing people to have permits to sell for effectively doing nothing. That said, the fall could also be related to higher oil prices."

Martin, no doubt a sincere gent but a trifle unworldly, evidently labours under the belief that the snake oil salesmen of Leadenhall Street are as concerned about the environment as he is. The terrible truth, that has now slowly dawned on him and his gang, is that these financial wizards don't give a flying fuck about carbon dioxide, and global warming. That they don't actually do anything but shift around worthless bits of papers in what is after all a sophisticated shell game, authorised and authenticated by the stupid Governments who signed up for Kyoto. he now realises that these City are more concerned with Porsches, holidays in the sun and prefer the air controlled ambience of the Spearmint Rhino to melting polar ice caps.... but such is his faith he thinks well...maybe it is the oil price... I hope (but it is unlikely) he has a sound Financial Advisor.

Curiously Margaret Beckett the Minister responsible cannot be found anywhere, no doubt cooking a hearty breakfast in some French layby in her lightweight Grand Touring shed on wheels using a gas cylinder that has doubled in price since last year.

A DEFRA news release from 2002 is revealing about how preternaturally stupid she is..

Margaret Beckett saw how trading takes place and said today:

"This is the first time that I have been able to see for myself how the trading of allowances under the UK Emissions Trading Scheme actually works in practice and meet some of the people who are involved in it every day. Since this innovative Scheme started at the beginning of the month, I have been encouraged by the amount of interest it has generated both at home and internationally.

"The Government is demonstrating to the world how cutting greenhouse gas emissions reductions can be achieved at minimum cost. We are working with the grain of the market, by careful design of economic instruments that show business how there can be real commercial benefit in making savings.

" The UK's Scheme is giving both the Government and its participants early experience of emissions trading, as well as creating an opportunity for the City of London to become a global hub for greenhouse gas emissions trading.

"The business community was at the forefront of the development of this Scheme and recognises that this is an significant opportunity to gain early experience of this important new market. I shall follow the development of this initiative with considerable interest."

Meanwhile Forbes reports that the UK government has quietly withdrawn from further court action against the European Commission to increase the number of carbon dioxide allowances available to UK firms under the EU Emissions Trading Scheme (ETS).

This was an action which the Government undertook under pressure from large energy users to increase the size of the UK cap - this is effectivly a last ditch attempt to salvage the market for the money jugglers at the expense of manufacturing industry as they wait the publication over the next two weeks of the performance of other EU countries, UK included.

Pic of the environmentally aware Beckett planting an Oak Tree in the rain - evidently well dressed for the event.

Further chaos in Carbon Markets in Europe - UK are losers.

The 21 EU Member States with active registries (Cyprus, Luxembourg, Malta and Poland figures are still not available) have allocated an annual average of 1,829.5 million allowances to installations in the ETS. Independently verified emissions data for installations operating in these 21 Member States (with a small number still to report) amounted by 30 April to approximately 1,785.3 million tonnes for 2005. 44.1 million tons less carbon dioxide, or 2.5 % less, in 2005 than expected.

The European Commission admitted Monday that member states had given companies far too generous targets for greenhouse gas emissions last year, (well there is a surprise) raising questions about the Continent's ability to meet its obligations under the Kyoto Protocol and triggering chaos in Europe's embryonic market in trading emissions.

It appears that the higly paid analysts in this market did not, or could not understand that European governments are more interested in protecting their companies than in reducing carbon emissions.

The EU has devised the Emissions Trading Scheme (ETS) as a model for carbon trading to fight climate change and meet its Kyoto pledges to reduce emissions of global warming gases.

12,000 utilities and high energy plants, aluminium smelters etc., have from Jan. 1st 2005, to buy and sell permits to emit carbon dioxide, which it is claimed cover approximately 40% of the EU's total CO2 emissions.

A CO2 cap has been set for each plant in the scheme, with the intention of causing a shortage keep prices high of carbon credits high, which should encourage high polluters to reduce emissions and provide a market in extra credits that "greener" plants can trade.

Prices in the freely traded credits , which are traded by anybody, not just CO2 producers fell like a stone when reports that Germany, France, Italy and other EU countries had emitted far less CO2 than had been expected. Since then against all reason and expectation they have risen. Possibibly due to people having to complete shorted positions in the market.

The UK has emitted more CO2 than its quota, forcing it to buy over 30 million tonnes extra allowances on the EU carbon market. This did not offset the overall trend, prices have fallen and so has the whole credibility of the EU scheme.

Most market analysts cited by Bloomberg news agency agree that over-allocation is the principal cause of the market mayhem , "It's clear that most countries were too generous when handing out allowances," said David Foster, head of emissions and weather derivatives at Calyon, part of Credit Agricole SA. "There's no doubt [EU countries] had an incentive to exaggerate emissions," said Per Lekander, an analyst with UBS AG in London.

The scheme is a shambles , naturally the cricket playing Englishmen have played by the rules but it appaers no-one else has, and the spivs have cleaned up. Plus ca change.

Banks, brokers, hedge funds and traders that jumped into the rapidly growing market for trading carbon emission credits are now complaining bitterly that the big difference between what countries estimated they would use and what they actually used has crewed the market Well fucking well grow up you ninies , this is the real world , full of dishonest xenophobic politicians and industrialiast who care more for the bottom line than the environment.

The spivs have of course made off with their loot.

Ma Beckett's Legacy - A fucked over ETS market and soaring energy costs

Camilla Cavendish ( a ravishing blonde judging by the byeline in Thursday's Leader page of Rupert's Rag the Times) has almost caught on to the nonsense of the EU Emission Trading System - Ma Beckett's legacy at DEFR.

" ...a prime example of ineffective bluster has been the EU's scheme for emissions trading.... What matters for global warming is whether greenhouse gas emissions are falling. And they're not"

What has esacped the sultry pouting Camilla (not to mention sultry pouting Margaret Beckett) with her deep beguiling eyes, is the fact that the architects of the ETS couldn't give a flying fuck about carbon dioxide concentrations, global warming, rising sealevels, emissions from power station , nocturnal or otherwise. What they deeply care about, the lawyers, the accountants, the merchant bankers, the consultants, the hustlers of very expensive weekly tipsheets serious analytical real time comment is MAKING MONEY - PREFERABLY LOTS OF IT.

The carbon market is merely a device to shuffle the worlds money, the stuff you shovel into pension funds, hold on deposit in the bank, the building society, your Mutual fund, hedge fund through the hands of dealers who willingly and with a smile take their commission, margin and profit.

The traded unit is a tonne of carbon, (EUA = EU allowance) produced by a producer of carbon dioxide in excess of their permit. Produce a tonne more than allowed and you pay the EU a tax of Euros 40 so the idea is you buy the unused tonnages (the EUA's) from someone who has underperformed. The broker sits in between (courtesy Ma Beckett) and peddles the differences.

Another example perhaps easier to comprehend is the Milk Quota scheme which has been operating for a very long time.

1. Every farmer is given a milk quota of (lets say 100 gallons).
2. Farmer A through better breeding , feeding produces 200 gallons.
3. Farmer B is idle, incompetent, stupid .. and greedy "sells" (or better still "rents" his quota to farmer A, (broker Y arranges the deal and takes let's say 5% of what A pays B.

Result, the market still gets the milk, but has to pay Farmer B, through higher wholesale and eventually retail prices for milk - Farmer B sits on his arse and draws a wage.

The carbon market is much more complex (sophisticated say the denizens of this jungle). Remember the Financial markets are casinos. They are merely well dressed and often highly educated gamblers - usually gambing with someone else's money and merely ladling their share off the top on every deal, buying or selling.

Gambling is universally enjoyed (Ask Tessa Jowell). However as the punter craves excitement and the book keeper wants more profit, devices are produced to satisfy both.

For example take horse racing

1. You can bet that Horse A will win. You place a bet, the odds of which have nothing to do with the likelihood of it winning but merely reflects the market view, as the amount of money staked on each horse, which is why 33-1 winners keep cropping up. The Gubment takes their share by a tax.

2. To add to the excitemtn you can bet on a place and get reduced odds 1.e 2nd pays 1/2 odds agreed on stake etc., - Bookies milk the market for big (i.e popular races, the derby) extending this to 4th place.

3. On top of this all sorts of "derivatives" arise on horse racing , Doubles, Trebles, Yankees , simply to raise the excitment (enjoyment ?) of the punter and the income of the bookie.etc.,

In football you can bet on the time, kicker of first goal, corner, person sent off, injure whatever.

Just so the Carbon market - and here is where the real money is in the carbon market.

The core market exists in 5 European trading centres who buy and sell the basic contracts , the big players use those prices as their benchmarks.
For example Dresdner, Kleinwort, Wassserstein (DRKW) the investment bank arm of the huge Deutsche Bank have introduced 2 products - because the world is split up into 2 sorts of investor (punter / mug / gambler / hedge fund manager ).

1. Those who think the market price of carbon will go DOWN
2. Those who think the market price of carbon will go UP

Expect the carbon price (EUA) to go DOWN, then DRKW will sell you (from 29th May) a "Knock out" put Warrant with a strike price of Euros 50 to expire on 3rd December 2007, the issue price is based on the EUA price on the Leipzig based European Energy Exchange (EEX) price. In other words the warrant is inversely linked to the carbon / EUA price.

How does this work / How do I make a profit ? DRKW charged on issue date Euros 30.95 ( Face value Euros 50 less that days price Euros 19.05. As the price of the EUA falls the warrant price goes up.i.e if the EUA drops to Euros 10 then the Warrant has a value of Euros 29.05. As the warrant is tradeable on the (regulated unofficial Freiverkehr in Frankfurt) or the EUWAX European Warrant Exchange, you can realise your trading profit, paying a modest sum to DRKW for their endeavours of course.


Expect the carbon price (EUA) to go UP, then DRKW will sell you (from 29th May) a "tracker certificate" at Euros 19.95 on issue date from 29th May of Euros 19.95. As the price rises the Warrant value will increase and again can be traded and profit taken.

What if the price doesn't go UP/DOWN as you expect. Well you are fucked, you have a piece of paper that has no worth , no assets, no value but which you can sell to somebody else assuming there is someone wanting to buy it.

... and DRKW , well they don't give a fuck if the price goes up or down, they draw their commission ( and beady eyed readers will note that the "Knock out" Warrant was using a price on issue of Euros 19.05 and the Tracker Warrant was using a price of Euros 19.5 - that Euros 0.90 "spread" is also an element in DRKW's humble margin.

This is a single example of just one "derivative" that your pension fund manager is gambling in putting your money into, either directly or via investment into another fund / hedge fund or through a bank deposit.

All this activity does not affect the price of EUA's , the production of carbon ...it is merely an accepted benchmark to allow a very small number of very rich people and institutions to cream off immense sums of money for themselves.

Does it cut carbon emissions ? ... NO
Does it cut the costs of energy? ... NO
Does it drive investment on carbon reduction / clean delivery ? ... NO. See FOOTNOTE

APOLOGIES

I must apologise if this is a tad complicated . There is a reason. Banks have tremendous security and so it is difficult to steal money from them using guns and masks (unless of course it is situated in Belfast) so it is a lot easier to steal money from the banks customers by computerised money transfer and couple of telephone calls.

I also apologise on the behalf of Ma Beckett who so enthusiastically endowed you the taxpayer with this fraudulent scheme which has been so helpful in "forcing" the major power utilities (curiously, owned by German and French companies) to increase the charge for gas, and electricity to your home ever since this insane scheme started.

Effectively she has placed a tax on every energy consumer, a tax that doesn't go to the Gubment but to the serried ranks of lawyers , accountants, traders, bankers , consultants .... God Bless her.

WHERE ARE THEY NOW ? MA BECKETT

She is now the Foreign Secretary who is now telling Prime Minister Olmerde to show restraint whilst he kills the Palestinians in Gaza, much as one might shoot fish in a barrel, or the Marronite Christian militia shot Palestinians at the Sabra and Shattila refugee camps whilst Ariel Sharon stood and watched.


FOOTNOTE

The UK Gubment paid for a survey to see how the scheme was working, this was before the market collapsed in April (published 30th May 2006) "Business views on International Climate Change and Energy Policy" by the UK Business Council for Sustainable Energy and The Climate Group. Conclusion ... " the emerging carbon price is not seen to be long-term enough to influence strategic decision-making, for example, over investments into new plant. This is compounded by the high level and volatility of gas prices."

"The EU ETS is seen as likely to survive independent of Kyoto, but be weaker without it and may so may eventually wither away."

" .... a few (companies) are of the view that the EU ETS would not survive."

" one company descriptively called the UNFCCC administration (organisers and bureaucrats who administer the ETS) as a ‘time intensive, lawyer invented scheme, with benefits to a lot of consultants".

"The political assumption that ETS, because it is set in legislation, will outlast changes in the international framework, is not a given for business. At least some assume that with a crumbling international regime, the ETS will be allowed to quietly fold, given that EU legislation is subject to national politics."


Well done Ma ... you dumb bitch.

The UK Business Council for Sustainable Energy was launched in 2002 bringing together the key players in the UK energy sector, to enable a high level policy dialogue with Government on climate change, and the transition to the wider use of sustainable energy.

The Climate Group is an independent, non-profit organization dedicated to advancing business and government leadership on climate change. Based in the UK, the USA and Australia and operates internationally.

She's in Washington today telling Contileezza Rice that "Climate change" is the most important thing in world affairs ... Go and tell that to the Palestinians caught like rats in a trap in Gaza. Has this woman no moral compass ? She was in Chicago at the Mercantile Exchange, probably trying to set up a futures market in dead Palestine Babies. Some people from Israel have already made a kiling in the market.

Euro carbon trading scheme in final stages of collapse

The EU has been running a Common Fisheries Policy for decades, it is a carefully designed policy to centrally allocate quotas and to limit environmental damage. This bureaucratic nonsense has saved neither the fish nor the fish eaters from over fishing in European waters.

The EU Emissions Trading Scheme ETS is a carefully designed policy to centrally allocate quotas and to limit environmental damagein which polluters (i.e net emitters of carbon in carbon dioxide over some fanciful self declared target) pay non- polluters (i.e net emitters of carbon in carbon dioxide below some fanciful self declared target) for their mythical non emitted tons of carbon has collapsed.

The accompanying graph (price of 1 Tonne of tradeable carbon) shows that carbon is trading at it's lowest levels ever and drifts lower in the market every week.

This financial juggling has failed in every respect to save the environment but has enriched many lawyers , accountants, consultants, and City traders at the expense of a credulous investing public. It is one of the most successful financial scams of the last decade - eclipsed of course over time by the "pensions industry".

FOOTNOTE TO HISTORY

At the recent 11th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP-11) in Montreal, 28/11 - 9/12 06 the the 25 EU ministers (knowing the game was up) stopped short of mentioning greenhouse gas reduction targets for 2020 (let alone 2050) that EU heads of states had agreed to in March.

Greenpeace welcomed "many positive elements" of COP 11 which "underline Europe's commitment to tackling climate change". Ho.Ho.

They added : "the text on the post-2012 process is vague, and ignores the urgency of getting it under way with a clear end date for the completion of negotiations".

They commented on the real politik rather sharply "The UK presidency's claim that climate change was one of its main priorities has been exposed as subordinate to Britain's special relationship with the US and its obsession with tactics over substance."

Here is a wonderful picture of the happy, happy people at the LSE on the morning of February 23rd when Econergy (ECG) "a world leader in Carbon Credit origination and sale" raised £60m through a placing of Ordinary Shares of 1p each with institutional investors.

ETS and Carbon market set for final collapse as Germans lower the bar

The BBC ( Newsnight and online) report that the the German government is about to trigger a new crisis in Europe's flagship climate policy, the Emissions Trading Scheme (ETS).

BBC News ( in disturbed and amazed tones) understands the German cabinet is likely to agree a deal that will reduce carbon emissions from industry by only 0.6% between 2004 and 2012.

"I have been a big supporter of the EU ETS, but hearing the German news I feel more depressed than I ever have done about our ability to tackle climate change," said a visibly depressed and upset Professor Michael Grubb of the UK Carbon Trust, set up by the British government ( as a hopeless gesture) to help create a low-carbon economy.... and distribute tax payers money amongst the needy academics who live by pursuingthis CO2 / GG nonsense, keeping the HMG Fear factory churning away.

Gloomy Grubb went on to say , "The German position is ridiculous - their emissions had been coming down over a long period of time. Last year's figures are definitely not a blip and this agreement is certainly nothing to do with protecting the climate." (Could this be the welcome end of the Carbon Trust ?)

The news may comfort the US (and other) climate sceptics who predicted that Europe would talk big on climate change but fail to impose large carbon cuts on its own industries.It also confirms the views of those (like Lord Patel) that the whole ETS and carbon trading was a massive financial scam ... sedulously supported by the gormless Margaret Beckett.

At least the Germans will be announcing their EU ETS plans on deadline on Friday. Most other EU nations do not have their plans ready.

The UK government is waiting on the German decision because in the last phase of the EU ETS, British firms complained that the Germans had been given too many carbon permits, conferring a competitive advantage.

The Swedish government has agreed a lax cap on CO2 and is expected to stick to that unless Germany and the UK impose much stricter caps. This now looks most unlikely, and will badly undercut the EU's position in international negotiations on climate.

The European Environment Agency has released figures showing that the EU is badly under-achieving on its Kyoto targets. EU emissions rose by 0.4% in 2004 relative to the previous year. UK emissions rose 0.2 %. In 2004, the combined EU-15 emissions were only 0.9% below 1990.

Emissions of climate-changing greenhouse gases (GHG) from the EU-25 increased by 18 million tonnes (0.4 %) between 2003 and 2004. Emissions from the EU-15 increased by 11.5 million tonnes (0.3 %) in the same period. These figures, released today, are contained in the latest GHG inventory report from the European Environment Agency (EEA), based in Copenhagen.

Spain and Italy saw the largest emission increases in absolute terms with plus 19.7 (4.8 %) and 5.1 (0.9 %) million tonnes respectively. On the positive side, 2004 saw emissions reductions from Germany (- 9.1 million tonnes, - 0.9 %), Denmark (- 6 million tonnes, -8.1 %) and Finland (- 4.2 million tonnes, - 4.9 %).

The following figures and table give details, for the EU-15, of trends in emissions of the six greenhouse gases up to 2004. Emissions from international aviation and shipping, and emissions from/removals by land use change and forestry, are not covered.

(C) EEA (left click to enlarge)

BREAKING NEWS

The German government approved a plan today by the cabinet that covers ETS policy covers policy between 2008 to 2012.

It allows industry and electricity companies to emit 482 Mn. tons of carbon dioxide (CO2) per year, marking an increase over last year's level of 474 Mn. tons, which the government said unfairly penalized German manufacturing industry.

The increased allocation is worth more than EUR 7 Bn. on the basis of a current market price of about EUR 15 / ton of CO2 under the EU's Emissions Trading Scheme (ETS).

Carbon - Expanding Black Hole

The boosters of the global carbon market excitedly claim the world market in carbon in the first half of 2006 was 684 millionn tonnes "worth" €12 billion. In value more than the whole of trades in 2005(€9.4 billion) , and 85% of volume traded in the same period (800 millin tonnes).Note that the total of all allowances to end 2007 in the EU = 2.1 Billion tonnes per annum, covering 13,000 industrial installations. Remember also that these allowances can be traded between years, i.e "borrowing" allowances for next year for the current year. (Graph of collapsing EUA price (again) in last 30 days)

Do not lose sight of the fact that the whole EU carbon market is created by politicians through political decisions, a dimension to any market that is beyond calculation and subject to manifold influences, national, ideological, stupidity, lack of information, misinformation, misunderstanding and pure simple corruption.

EU Emissions trading accounted for 440 million tonnes or 65% of the traded volume worldwide. As the market price collapsed in April May traded value declined dramatically.

The flexible Kyoto market mechanisms of Clean Development Mechanisms (CDM) and Joint Implementation (JI) have also seen a considerable growth in volumes and values this year compared to 2005. In total, 226 Mt, worth €1,976 million have been transacted. A major part of this was CDM trades at 193 Mt, worth €1,545 million. In addition, secondary CDM trades increased tenfold compared to 2005.

“This shows that the EU ETS is moving steadily forward and upwards, despite some turbulence during the last few months. The significant increase in traded volumes and values in emissions trading schemes in Australia and the US is also quite promising for the global carbon market as a whole”, says Henrik Hasselknippe, manager in Oslo based Point Carbon’s EU ETS team.

What the informed observer needs to bear in mind however is that all this activity is not related, as in standard commodity markets to actual amounts of actual product but to a notional amount of a product.

What is being "sold / traded" is the right to emit carbon as carbon dioxide from industrial / commercial processes. Typical sellers will or expect to produce less than they are allowed, so they may sell that unused right to emit to someone who emits more than their allocated amount.

The EU Emissions Trading Scheme (ETS) operates in a similiar fashion to the milk licensing scheme. To regulate supplies, and therefore the price of a perishable product, farmers were provided with a quota or license to produce so many litres of
milk, they discovered this was tradeable, and so a market grew, it attracted traders who could buy and sell such licenses.

The EU ETS operates in an identical fashion but the tradeable blocks are bigger, more valuable and therefore attract greater commissions, and with an inherent volatility (derived in part by the uncontrollable weather in Europe - which affects energy demand and hence CO2 production), market price fluctuations which can be exploited by knowledgeable, or lucky traders.

Naturally this market attracts it's snake oil salesmen, just as the booming pensions market did in the 70's / 80's 90's and the trick is to attract as investors, not those who trade carbon as part of running their business - power utilities, steel works, etc., but equity investors.

In the UK, if you invest in a fund, especially a pension at least some of your money will be sinking into this black hole,(eg Fidelity funds have just bought into 0.9% of AgCert International) however you can throw away your money without involving anyone else but a share broker.

There are currently 5 listed companies in which you can invest.
(alphabetically) AgCert International, Climate Exchange,Econergy, Ecosecurities,Trading Emissions.

AgCert International Plc
Apex Building Blackthorn Road Sandyford
Dublin, 18P: +3531.2457400 F: +353.

“Climate change is key to the world’s economic progress and AgCert is determined to play its leadership role in the reduction of greenhouse gases. “ Bill Haskell, AgCert CEO, when announcing results for 2005 on April 6th 2006.(Loss Euros 19,289,830)

AgCert’s business is the production and sale of reductions in greenhouse gas emissions (referred to as "Offsets") from agricultural sources on an industrial scale. Its methods involve the capture and combustion of biogas containing greenhouse gases, primarily methane, emitted from animal waste (shit) management systems ("AWMSs"). To achieve this, AgCert has developed proprietary data systems and processes which have been designed to be fully scalable and adaptable to the AWMSs of large confined animal feeding operations including those for swine, dairy and poultry.

AgCert has developed rapidly, expanding its initial operations in Brazil and Mexico, establishing operations in new geographies, namely Chile and Argentina, and extending its activities to new agricultural sectors, such as dairy and poultry.

(Un)Clean Development Mechanisms, Carbon Offsets,.. and the City money jugglers

Lord Patel remembers Ginny Buckley in the late 70's as an 8 year old gap-toothed chatterbox - transformed now into a slim svelte, 42 year old Mum who fronted an asinine quasi travel/Money /Green program on BBC2 Wednesday, 24 January 2007 at 21:00 GMT on BBC Two. - Should I Really Give Up Flying? about the current "debate" about the contribution of jetliners and their cargoes of thoughless and hedonistic holidaymakers.

This program consisted of vacuous stilted scripted conversation between the voluptuous Ginny in skin tight black jeans, revealing shirtwaister and some neat tricks with a scarf, moodily shot (Paris. Texas - asif ?) on some downtown rail tracks or in St Marks Square with the vapid Max Flint, who will soon take up shaving.

This programs was says the BBC ...

An examination of air tourism and its impact on the environment, to help viewers make up their minds about their own flying habits. Presenters Ginny Buckley and Max Flint reveal the effects of climate change on some of the world's favourite destinations and explore the impact that the explosion in budget airlines both in Europe and India could have on the environment. The programme also visits beneficiaries of offsetting from the Mersey Forest to the Masai Mara.

What we got was what could have been library shots of "Where I would like to go for my Holidays" with a totally uncritical , uninformed race through the benfits of tiny solar powered lights to an Indian village, a very sparky and savvy Kenyan teacher who had a mobile phone network re-charged by batteries, charged by hugely expensive solar power - which could easily have been done with readily and widely available hand cranked Taiwan made mobile phone charging devices.

It also included the absurd Brian Blessed saying how wonderful Doncaster (the epicentre of Labour Party Local Government corruption) airport was and the loothsome grinning pullover

Lord Virgin of Grope explaining how he was going to use biofuels to power his planes - which the excellent ex school colleague of Lord Patel, anti airport campaigner (he lives near Manchester
Airport) Geoff Gazzard , explained was nonsense as biofuels freeze at minus 3/4 degrees and even the bearded wonder's planes fly at temperatures of minus 40 degrees.

A supreme example of how inane, lightweight, visually unexciting and verbally apalling BBC TV programmes can be.

Now Channel 4 are at it this week (Wednesday 7th) with a really incisive incisive view about the corrupt, futile, Clean Development Mechanism (CDM), carbon offsets and the ETS. (also Part 2 scheduled for Thursday -today but it didn't)

The excellent Tom Clarke has foundand publishes the details of some CDM carbon trading
schemes rich countries pay into, may not be adding to global cuts in emissions and may in fact
may, in fact, be damaging the local environment. He has found that currently Indian CDM plans
approved and in the process of approval would amount to companies receiving £1 -2.5Mn across 290 known schemes.

He raises first the case of Sri Bajrang & ISPAT in the Chantisgar state who have been served
notice by the State regulator - which they deby that they are not judged to be sustainable.

Further south in Karnataka he looks at the OP Jindal Group who have benefited by Euros 20 Mn. and whom Sunita Narain of the Centre for Economic Development claims that the rk undertaken was necessary and provides little environmental benefit for the local economy and area - again stoutly rejected by the company.

All the time these payments from the prosperous North are referred to as Investments. They are nothing of the kind, they are merely ;

1. A license to continue pollution
2. They are effectively a modern version of the mediaeval sale of indulgences, where a priest would undertake prayers (at a cost) to allow the sinner to continue their wayward life. January 27, 1343, that Pope Clement VI issued a bull, Unigenitus, officially reaffirming that the Catholic Church can grant remission of sin through indulgences.
3. They allow the erection of the market to trade in these "carbon credits" which become pari passu with the ETS units under the EU cap scheme with all it's derivatives and sparkly financial mumbo jumbo of commodities markets.
4. Ultimately these rigged markets allow the leaching (leeching) of pension funds either directly
or via "Hedge funds" and similiar corporate (and barely legal) quasi stick up gangsters.

One thing the CDM scheme and carbon credits do not do, is reduce the production of CO2, and other myriad attendant pollutants - PCB's , Dioxins, sulphur, toxic heavy metals and especially fine particulates.

The whole CDM circus also deflects critical attention on the production and pollution in the developed world and the respiratory epidemics, skin ailments, actions of oestrogen mimetics and many, as yet unknown consequences that follow unbridled pollution - whilst at the same time allowing the polluters to claim how hard they are working at providing a sustainable world ...simultaneously helping the 3rd world.

Wonderful how things haunt you .. poor old Larry Summers Ex World Bank, Ex Dean of Harvard famously endorsed a memo in 1991 from Lant Pritchett which was alleged to be "ironic". It advanced an economic argument for the dumping of pollution from First World countries in the territory of 3rd World countries.

Just between you and me, shouldn't the World Bank be encouraging MORE migration of the dirty industries to the LDCs [Least Developed Countries]? I can think of three reasons:

Read the rest here ....

Tommorrows reading will be from "Carbon Trading" .. a critical conversation on climate change ..Dag Hammarskold Centre. Sept. 2006 . Chapter 4 Page 219 et seq. Offsets - The fossil economy's new arena of conflict.

In which it is shown how projects designed to "compensate" for continued fossil fuel use are helping dispossess ordinary people of their land, water, air - and future.

BBC Five Live did a program (40 mins) by Matthew Chapman (Sunday 29 October at 1100 GMT ) which you can hear by clicking the link.... learn what happens when you "carbon offset" your air travel.

A report about the program is available at BBC Online .

Learn how

Money pledged by the UK to make up for the pollution caused by the world leaders flying to last years G8 summit in Gleneagles hosted by Tony Blair to help a Cape Town township cut energy costs by installing low energy light bulbs, is paying for bureaucrats and accountants, BBC's Five Live Report has found out. (This was, bragged TB a G8 "Carbon neutral" summit)

An independent body, South South North, involved in the project, calculated it would raise £37,000 from the sale of carbon rights for re-investment in the poverty stricken township.

Result ? Hiring auditors to meet needs of the CDM mechanism (KPMG) in the way demanded by CDM, cost £54,000, leaving Cape Town council in debt to the tune of £17,000.

Learn how ;

The Carbon Neutral Company Ltd., (originally known as re-Leaf Britain Limited 1995 , Forests for the Future Ltd 1996 and Future Forests Ltd 2005, ) one of 2 favoured by the Gubment (the other is Climate Care Ltd of Oxford , previously Co2 Management Ltd., 2003, CST Management Ltd., 2000- they are now a subsidiary of Co2.org - Climate Care is the trading name of Climate Care Trust Limited. who confusingly pays a fixed royalty of 10% of annual turnover to Climate Care Ltd) hasn't produced any accounts beyond June 2005, (i.e accounts are due) and will sell you a right to carbon which will squester in trees that were planted before they got involved and whose lifetime will be determined by the owners - who might be The Government Agency the Highlands and Islands Enterprise Council.

The Carbon Neutral Company Ltd., principal shareholders their website reports, are , Zouk Ventures (whose website deescribes them as a a London-based venture capital firm) who manage $100 million in two technology funds and owns investments in Finland, Germany, Ireland and the United Kingdom.

Triodos Bank is an independent bank investing in enterprises creating social, environmental or cultural added value - for example they sponsored the Soil Association Annual Conference January 2007 - ‘One Planet Agriculture’ at the Cardiff International Area.

Confused ? You will be. In the fantasy world of CDM and Carbon offsets.