Oil trader Vitol Group was 2010's top developer of projects producing emissions credits that can be traded, according to a Bloomberg New Energy Finance survey. The company developed projects yielding more than 12 million tons of U.N.-certified carbon credits. JPMorgan's EcoSecurities unit ranked second.
While the Clean Development Mechanism has helped lower global greenhouse gas emissions, critics hope weaknesses in the United Nations-administered system will be addressed at the upcoming Copenhagen summit. Critics charge the CDM, which allows companies and countries to purchase carbon credits to offset their emissions, often is subject to manipulation and ends up supporting dirty industry in developing countries.
Sen. Debbie Stabenow, D-Mich., is working on new provisions to the Senate's climate-change measure that would clarify rules for a program designed to issue credits for reducing carbon emissions. Under the amendment, the Department of Agriculture would take the lead in handling key features of the carbon-offsetting system. The draft also intends to make the USDA and the Environmental Protection Agency jointly responsible for the program, which must be established within a year of the bill's enactment.
Despite widespread cancellations, delays and cutbacks for carbon-credit projects because of the credit-market meltdown, executives in the carbon-trading business see a bright future for the sector. Nearly 90% of the industry leaders responding to a survey by market-intelligence firm Point Carbon were optimistic that the U.S. will set up a cap-and-trade carbon-emissions market, thanks to the election of President Barack Obama.
Businessmen such as Australia's Dorjee Sun have been drawn to the burgeoning market, where deals sometimes require a careful hand to balance investor and government concerns. Sun, who heads the firm Carbon Conservation, is aiming to sell carbon credits from deforestation projects in parts of Indonesia to developed countries.