Carbon markets slow down.

• Author: Block, Ben
• Position: EYE ON EARTH - Brief article

Negotiators are set to decide on the next international climate agreement this December in Copenhagen, Denmark. Until then, uncertainty surrounding how the United Nations will regulate carbon offsets in developing countries has slowed investment in related projects, carbon traders said at an April conference in Washington, D.C.

Although investments in greenhouse gas offset projects such as methane capture, soil sequestration, and reforestation are difficult to measure, market analyst Point Carbon predicted that the volume of high-value Certified Emission Reductions (CERs)--carbon credits from UN-approved projects--would fall 45 percent in 2009.

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U.S. carbon investments are likely to increase if the country develops a domestic cap-and-trade carbon market, which would allow polluters to exchange carbon credits. Congress has begun drafting legislation to this end, but carbon investors are not likely to increase their spending without knowing key...