Carbon prices predicted to sharp rise next year

The ETS has collapsed, some say, now when the prices are less than one € per ton. It is however to early to tell since there will be a new period beginning 2008 ending 2012 and the World Bank in its annual report on Carbon Markets predict a rise to 12€ per tonne. The project-based market is growing fast with a doubling to US$ 5 Billion in 2006, which is a doubling in one year. It is in the shadow of this market that the "Carbon Cowboys" operate.

The higher prices are necessary to boost the energy efficiency improvements that after all is the most necessary and most valuable instrument to reduce the emissions. The IPCC report that was delivered today should be very explicit on just energy efficiency technologies and measures.

The type of projects, especially on CDM, however still show a shortage of energy efficiency, which is not only a pity but a real problem if the renewable fuel projects instead are feeding an inflated demand. The IEA head Claude Mandil only recently said that a successful GHG-abatement depended to 78% (!) on energy efficiency improvements.