- English
Book Review
Climate Trading: Development of Kyoto Protocol Markets
Author: Deborah Stowell
Publisher Information: Palgrave Macmillan, Basingstoke, 2005. Finance and Capital Markets series. 264 pp. Hardcover
ISBN: 1-4039-1616-0
Emission trading and the market-based mechanisms of the Kyoto Protocol are becoming more and more fashionable topics for authors with the introduction of the European Union Emission Trading System in January 2005 and the entry into force of the Kyoto Protocol the following month. From the web-based information provider PointCarbon, which offers tailor-made products for business, through traditional management literature (De Jong and Walet 2004), to academic literature (Yamin 2005), all strands of media are represented. Stowell's book takes an intermediary position between the latter two. Stowell is an old hand in the climate policy field and thus one starts reading her book with high expectations. These are fulfilled insofar as the contents are up to date and factual errors are absent. However, the description is often a little legalistic and tedious, while references could have been more comprehensive and the degree of analysis somewhat deeper.
Stowell starts with a short description of the climate change issue and the negotiation process leading to the Kyoto Protocol. The description of the Kyoto mechanisms rules takes 45 pages. Rightly, a lot of emphasis is put on reporting and monitoring rules, an often neglected issue. A chapter on domestic and regional trading schemes follows. This includes some interesting detail, such as the administration fees of the Danish trading scheme and the exact design of the infamous UK subsidy scheme for participants in emissions trading. Impacts of emission management for industry are then discussed, including a table postulating at what allowance prices changes in power plant use would occur. Also, the Eurelectric trading simulations and the BP/Shell internal trading systems that were the late 1990s, voluntary frontrunners of emissions trading are described. The chapter on acquisition programs for clean development mechanism (CDM) and joint implementation (JI) projects is very interesting. It gives an overview of all funds and tenders, and discusses baseline methodologies and risks encountered when developing CDM and JI projects. The World Bank and Dutch programs that started CDM and JI acquisitions already since 2000 and were crucial for the development of the market are assessed in detail. Then - surprisingly - a new chapter on the global carbon market tries to summarize transactions; it would have benefited from drawing on sources other than the World Bank. The book is concluded with a somewhat sketchy outlook on climate policy beyond 2012.
Altogether, Climate Trading provides a solid but not fascinating description of the Kyoto Protocol, the Kyoto mechanisms, and other greenhouse gas emission-trading schemes. It will be very helpful for those who need a solid introduction to the Kyoto Protocol and its flexible instruments as well as initiatives at the country level. However, given its high price (125.00GBP or 180.00USD), I would recommend sticking to a library copy.
Remarks:
International Review for Environmental Strategies (IRES) Volume6 Number1
http://pub.iges.or.jp/modules/envirolib/view.php?docid=446
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