The Role of Companies in Kyoto Mechanisms

In light of CDM’s operation since its establishment by the Marrakesh Accords, the JI Supervisory Committee’s developing modalities and procedures for January 2008, the EU Emissions Trading Scheme completing its 3 year “pilot phase” and with other national and regional trading schemes being established, this paper reviews issues that have or may arise concerning company participation (or non-participation) in market-based instruments, such as the Kyoto Mechanisms. The International Chamber of Commerce takes note of governmental proposals and enacted legislation to implement national and regional frameworks for the Kyoto Mechanisms, for example, the European Union’s Emissions Trading Scheme (ETS), which is currently completing its first phase. The objective of these policies and proposals should be to provide frameworks and procedures that enable markets to credibly reduce GHG emissions, minimize societal costs, and stimulate investment, innovation and trade. The experiences of companies with the ETS, and other pilot emissions trading programs, should be taken into account to improve the functioning of those programmes and reduce unnecessary costs and bureaucracy.