Carbon Forum Asia (CFA) - The Trend Is Blue
Carbon Forum Asia (CFA) has become an important annual event which provides a platform for the discussion of issues and opportunities in the carbon trade in Asia and beyond. With the development of carbon markets in the east - countries like China, Indonesia, Vietnam, and Australia have announced plans to introduce market-based mechanisms to combat rising carbon emissions – the profile of the forum is steadily growing.
The CFA event this year was jointly organised by Koelnmesse and the International Emissions Trading Association (IETA), as a means of convening governments, industry, and the civil society for the purposes of discussing climate change. After a two-year run in Singapore, the event was held in Bangkok on 30th and 31st of September, 2012. Explaining the shift, Event Director Michael Dreyer explained that the government of Thailand has been very active in CDM and implementing domestic measures.
The focus of the forum remained on the issue of compliance in Asia, and its effect on global carbon markets. The topics discussed were:
- New Market Mechanisms (NMMs)
- The future of the CDM and JI mechanisms.
- China’s pilot Emissions Trading Scheme (ETS).
- Japan’s take on carbon markets after Fukushima.
- The benefits of choosing carbon trading over carbon tax.
The timing of the conference was very crucial, since there have been significant developments. Australia has introduced the carbon tax and plans to roll out an ETS by 2015. The introduction of the Carbon Farming Initiative (CFI) has also provided additional revenue streams for the agriculture sector. According to the World Bank, carbon market grew in total value by 11% in 2011, to $176 billion, and where transaction volumes reached a new high of 10.3 billion tons of carbon dioxide equivalent.
China is currently developing 7 pilot Emission Trading Schemes in high-emissions cities and districts, and these will anchor a broader programme on a national level expected to be launched by 2015. It has been reported that the scheme is designed in such a manner as to allow it to be ‘linked’ to other international schemes. The World Bank has since confirmed in an interview that the development of carbon markets in various parts of the world is paving the way for potential linkages that might underpin a future global market. The market-based mechanisms to be introduced to combat carbon emissions in Indonesia, South Korea, and other parts of the world also seem to be steps in this direction.
The highest participation at this year’s event came from Asia (74%), followed by Europe (16%), and then Oceania and North America (8% and 2% respectively). This shows that interest is growing rapidly outside the traditional markets of the west, as the east embraces the idea of voluntary emissions control. Dreyer confirmed that the scale of the event is growing year-on-year, and that there is an increasing demand for national events to support the growth of carbon markets. The presence of delegates from industries ranging from finance to manufacturing underscored the growing commitment to sustainability that both industry and governments are demonstrating.
At this year’s event, the most well-represented category of guests was the buyers, sellers, brokers, and traders from the carbon-offset market. The list of companies and organisations that were represented included South Pole Carbon Asset Management, NetBalance, LRQA, DNV, the London Business School, the Gold Standard Foundation, and others.
Sector-wise participation in Carbon Forum Asia 2012 (%)
According to the Regional Manager (South-East Asia) of the Gold Standard Foundation, Ellen May Zanoria Reynes, “The conference enjoyed a qualitatively focused group of actors who had an order of business in the carbon markets, and was a great venue to learn about the various new mechanisms being considered amongst the different regions, particularly in Japan and Australia”. Gold Standard found the conference to be of great use, and expressed interest in attending the CFA next year.
The need for such events is growing, with companies increasingly coming to understand commitments to climate change not only as CSR activities, but also as a means of reducing baseline costs through improved energy efficiency and other measures. Growing awareness about sustainability is also affecting consumer choice across various industries.
Australia and many other countries has also recently stressed that climate finance is not a donation, but an investment. This marks a clear paradigm shift, which underlies the need to have events such as what CFA has been organising. The carbon market, both compliance and voluntary, will greatly benefit from such events due to the increased interest and awareness among various segments of the industry. The statistics from this year’s event reflect participation from across a widening range of industries.
The prominence of China, Australia, and Japan amongst the event’s representatives highlights a growing interest in these countries in tackling the challenge of climate change. This prompts the hope that pledging oneself to the cause of environmental sustainability – by addressing the issue of carbon emissions – will become a norm among companies of the future.